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Ameriprise Financial’s largest business helps individuals plan their finances and invest through its financial advisor network. Clients pay for financial plans and ongoing management of investment accounts, with account fees based on asset values. Advisors also sell investment and insurance products, generating commissions and continuing distribution fees paid by product providers. Management and financial advice fees account for most company revenue.
The company also manages money for individual and institutional investors under Columbia Threadneedle Investments, collecting fees mainly based on assets managed. Those products reach clients primarily through third-party distributors. Through RiverSource, Ameriprise sells annuities, life insurance and disability income insurance through its advisors, earning premiums and contract charges as well as income from investments supporting those obligations. Its banking and investment-certificate businesses also earn income on assets they own.
Fee income depends heavily on market values, clients keeping money invested and the company retaining advisors. A significant portion of revenue comes from investment-management agreements with the Columbia Management mutual fund family or other investment managers; these agreements can be ended on short notice. Ameriprise is a regulated financial holding company whose activities are limited to financial activities and permitted related businesses. Rules also restrict how much cash its banking and insurance subsidiaries can send to the parent.
The risk section is the longest, dullest part of the filing. This keeps only what can really hurt you: where it hits, how hard, when it plays out.
Every company claims an edge. Each one is checked against hard numbers like margins and returns: which hold, and which line gives way first.
Raymond James competes with Ameriprise for retail investors who pay for investment management, securities trading and investment products. Watch its retail investment business for clues to the client demand behind Ameriprise’s account fees and product-sale revenue.
LPL Financial competes with Ameriprise for financial advisors and retail clients, with both earning advisory fees and product-sale commissions through their platforms. LPL’s advisor recruitment and assets on fee-based advisory platforms are useful checks on competition for Ameriprise’s advisor-led revenue.
Stifel Financial Corp. competes with Ameriprise for private clients paying for securities transactions, financial planning and investment services. Its Global Wealth Management business is the closer comparison for Ameriprise than its institutional trading and investment-banking businesses.
Charles Schwab competes with Ameriprise for retail brokerage accounts, managed investments and client cash, earning revenue from trading, asset fees and banking. Watch its client cash balances and deposit-account fees alongside Ameriprise’s revenue from placing client deposits with third-party banks, which depends on short-term interest rates.
Bank of America’s Global Wealth & Investment Management business competes with Ameriprise to provide clients with investment management, brokerage and retirement products. Watch client balances in that business rather than the bank’s broader customer base when assessing competition for Ameriprise’s managed accounts and investment-product sales.
Wells Fargo competes with Ameriprise to serve wealth clients with investment management, brokerage and financial planning, but its overall results lean heavily toward banking. Its wealth-client activity is a more relevant comparison for Ameriprise’s client fees than its loans and deposits.
T. Rowe Price competes with Ameriprise’s Columbia Threadneedle to manage individual and institutional investors’ money through active funds and managed accounts. Flows into those products offer a read on demand for active investing, which affects Columbia Threadneedle’s asset-based fees.
Franklin Templeton competes with Ameriprise’s Columbia Threadneedle for retail and institutional assets, with both earning management fees tied to the money they manage. Watch Franklin’s managed-asset mix and management-fee revenue: asset mix also affects Columbia Threadneedle’s fees.
Invesco competes with Ameriprise’s Columbia Threadneedle through investment funds and strategies for institutions, earning almost all its revenue from managing investors’ money. Watch the mix between its higher-fee active equity strategies and lower-fee ETFs for clues to the investment preferences and fee pressure facing Columbia Threadneedle.
BlackRock competes with Ameriprise’s Columbia Threadneedle for retail and institutional money across investment strategies, with both generally charging fees based on managed assets. Flows between BlackRock’s active and index strategies help show the investor preferences that Columbia Threadneedle must compete with.
AllianceBernstein competes with Ameriprise both to manage retail and institutional money and to provide investment and wealth-planning services to high-net-worth clients. Watch its retail funds and private-wealth client flows for competition with Columbia Threadneedle and Ameriprise’s advisor-led services, respectively.
Affiliated Managers Group’s affiliated firms compete with Ameriprise’s Columbia Threadneedle to manage clients’ money through funds and separately managed accounts. Flows into their active strategies are a useful check on demand for the investment mandates that support Columbia Threadneedle’s management fees.
Voya names Ameriprise as an investment-management competitor, serving institutional and individual investors, while its retirement business mainly serves workplace plans. Watch Voya’s investment-management client flows rather than workplace retirement fees when comparing it with Columbia Threadneedle’s asset-based revenue.
JPMorgan Chase’s Asset & Wealth Management business competes for clients of Ameriprise’s wealth advisors and Columbia Threadneedle’s investment management, though banking dominates JPMorgan’s broader business. That segment’s client assets and flows are the relevant comparison for Ameriprise, rather than the bank’s overall results.
Virtus competes with Ameriprise’s Columbia Threadneedle in retail funds, managed accounts and institutional investment management, with both collecting fees tied to client assets. Watch Virtus’s fund and account flows for a read on demand in the same product groups that generate Columbia Threadneedle’s fees.
Artisan Partners competes with Ameriprise’s Columbia Threadneedle to manage sophisticated clients’ money in active global investment strategies. Watch notices that Artisan closes or limits a strategy to protect investment capacity: weaker asset growth can reflect those limits rather than weaker demand for active management.
Ameriprise depends on Genworth subsidiaries to cover 50% of the risk on existing RiverSource Life long-term-care policies; for RiverSource Life of New York, only policies issued in 1996 or later qualify, and Ameriprise remains liable to policyholders if the reinsurers do not pay. Watch Genworth’s legacy long-term-care claims and financial strength for its ability to meet those obligations.
Stifel Financial Corp. earningsSF
Stifel’s report will show how private clients are responding to investment and wealth services, a market where it competes with Ameriprise for customers.
Compare client assets or flows in Stifel’s Global Wealth Management business with its revenue, separating advisory fees from transaction-related income where disclosed. Strong assets and advisory revenue would show clients continuing to use these services, a supportive demand signal for Ameriprise’s advisor business; weaker assets or activity would point to pressure on demand for similar services. The key is whether private clients keep their assets and business on advisor platforms.
AllianceBernstein Holding, L.P. earningsAB
AllianceBernstein’s report will show whether retail-fund and private-wealth clients are directing money to services that compete with Ameriprise.
Read AllianceBernstein’s retail-fund and private-wealth flows alongside managed assets and management-fee revenue. Inflows and stronger fees would show continued demand for these investment and advice services, and stronger competition for Ameriprise’s Columbia Threadneedle and advisor-led businesses; outflows or weaker fees would point to pressure on demand or the fee base. The conclusion turns on whether clients keep their money in these services and whether those assets support fee revenue.
LPL Financial Holdings Inc. earningsLPLA
LPL’s report will show whether it is attracting advisors and adding fee-based platform assets, intensifying competition with Ameriprise for advisors and clients.
Compare LPL’s advisor recruitment or advisor-count changes with assets on its fee-based advisory platforms. More advisors alongside growing platform assets would show the rival platform attracting both advisors and client money, raising pressure on Ameriprise to recruit and retain them; slower recruitment or flat platform assets would offer less evidence of intensifying competition. The test is whether LPL can bring advisors and their clients’ assets onto its platform.
Fed Interest Rate Decision
Ameriprise’s rate-sensitive insurance, annuity, investment and banking products link interest-rate changes to investment income, customer crediting costs and the interest it pays on deposits.
Expected4.0%Last release4.0%
If it comes in above expectations
If the policy rate comes in above the estimate, borrowing costs may rise; higher crediting costs or withdrawals could pressure insurance and annuity margins, while higher rates may also lift income on investments as they reset.
If it comes in below expectations
If the policy rate comes in below the estimate, lower borrowing costs may ease pressure on banking and deposit expenses, but lower investment yields may reduce income and spreads on Ameriprise’s rate-sensitive products.
Ameriprise Financial, Inc. earningsThis company
Ameriprise earns much of its advice and wealth-management revenue from client assets, and this report will show whether growth in those assets and fees is translating into earnings.
Read client assets and net flows in Advice & Wealth Management alongside management and financial-advice fees and the segment’s adjusted operating margin. Rising assets and fees with a steady margin would show Ameriprise converting more client assets into earnings; rising fees with a falling margin would suggest costs or business mix are absorbing some of the growth. The question is whether asset growth is producing stronger operating earnings, not just a larger balance.
Genworth Financial, Inc. earningsGNW
Genworth’s report can help assess whether its subsidiaries can meet reinsured long-term-care claims; Ameriprise remains responsible to policyholders if they do not pay.
Watch Genworth’s long-term-care claims and related obligations alongside financial and capital disclosures that bear on its subsidiaries’ ability to pay. Manageable claims and resources that support payment would strengthen the basis for Ameriprise to recover under the reinsurance arrangements; greater claims pressure or weaker financial capacity would make collection less certain, while Ameriprise could still have to meet policy obligations if payment fails. The question is whether reinsurance shares the risk, not whether it removes Ameriprise’s responsibility.
