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Growth in its life insurance business as well as a high number of KiwiSaver investors has helped boost profits at AMP's New Zealand Financial Services division by more than 20 per cent.
Net profits for the insurance and financial advisory business were up 23 per cent to $75.4 million for the year ending December 2008.
New life insurance business was up 15 per cent while annual premium incomes were also up 12 per cent.
General insurance premium incomes rose 5 per cent to $91 million while home loan sales grew just 1.5 per cent to $750 million amid softening property market conditions.
Net cash flows were boosted by a whopping 74 per cent to $150.2 million largely driven by the nearly 100,000 people who joined AMP's KiwiSaver scheme during the year.
But at the same time costs were up, rising from $73 million to $76 million. The company attributed this to the consolidation of its head office in Auckland as well as developing the capacity to look after its new KiwiSaver members.
AMP Financial Services New Zealand managing direct Jack Regan said the business had performed well in difficult times and it remained a financially strong company.
But given the uncertainty in the financial markets AMP would continue to focus on driving costs down this year.
"We are aspiring to continue our growth but acknowledge the significant challenges," he said.
But results for its Australian parent were less positive with net profits slumping 41 per cent to A$580 million ($728 million) in the 2008 year, although its underlying profit was down just 8 per cent to A$810 million.
The company said it saw the underlying profit as its key measure of business profitability as it smoothed out the investment market volatility which accounted for the A$260 million difference.
But across the AMP Financial Services business net cash flows more than halved - dropping from A$2.9 billion to A$1.7 billion.
Operating earnings fell by 13 per cent to A$266 million in its wealth management division as assets under management fell by 23 per cent on the back of the falling investment markets.
That was partially countered by operating earnings in its wealth protection division which were up 29 per cent to A$154 million as insurance premiums rose by 17 per cent because of new business growth. But the life insurance arm was also hit by the investment markets and lower bond yields resulting in operating earnings dropping by 15 per cent to A$161 million.
In its AMP Capital Investors business, which includes its New Zealand fund management arm, operating earnings were down 9 per cent to A$136 million.
Management fees increased slightly by 3 per cent to A$187 million but assets under management were hit by the weak markets falling 17 per cent to A$92 billion.
AMP chief executive Craig Dunn said he expected market volatility to continue through 2009 but over the longer term AMP remained confident about growth in its wealth management business.
"We remain confident in the medium to long term outlook for the company," he said.
AMP's share price closed locally up 55c at $6.45.
