AMP Bank’s loan book grows by $300 million in third quarter

The non-major bank said its loan book grew by $300 million in the third quarter.

AMP Limited (AMP) released its figures for the third quarter of 2021, noting that AMP Bank’s total loan portfolio reached $21.3 billion during the period, marking an increase of $300 million.

According to AMP, this growth is the result of competitive owner-occupant pricing.

In addition, the non-major bank said it saw residential lending grow at a rate about 1.1 times faster than system growth in July and August.

The total number of loans also increased, from 20,974 to 21,262.

However, this change in numbers was complemented by growth of 311 residential mortgages, with practice finance loans declining from 355 to 332 in the third quarter.

Compared to the previous quarter, AMP Bank also reported that the total number of deposits (including customer deposits, demand deposits, time deposits, deposits on other platforms and super deposits) is increased from 16,120 to 17,146, reflecting an increase of $1 billion and Q3 filing figure of $17.1 billion.

Subsequently, AMP Bank’s deposit-to-loan ratio increased by 4% during the third quarter, from 77% to 81%.

Speaking about the figures for this quarter, AMP chief executive Alexis George said that with most of Australia in lockdown during this period, “our businesses have been focused on supporting customers, in continuing to drive our simplification forward and preparing for our split next year.”

“AMP Bank had another strong quarter, in a very active market, helping more of our customers buy a home,” he added.

“We advanced our wealth management transformation, which enabled us to deliver pension contribution reductions at the start of the fourth quarter, as we had promised. We also continued to invest in our North platform, which again increased assets under management.

In addition to these credit portfolio figures, assets under management (AUM) remained stable compared to the previous quarter at 131.2 billion.

However, AMP said positive investment market returns are offsetting the impact of net cash outflows.

Average assets under management increased during the quarter by $3.7 billion to now reach $132.4 billion.

A net cash outflow figure of $1.4 billion was also recorded, improving on the outflow figure of $1.8 billion in the third quarter of 2020.

AMP Capital’s assets under management, however, fell 4% to $180.3 billion from the prior quarter, a decline that AMP said primarily reflects an increase in net cash outflows.

According to the financial group, the net outflow of funds during the third quarter reached 12 billion dollars. In the third quarter of 2020, this figure was $2.4 billion.

“AMP Capital’s cash flows primarily reflect internal outflows [New Zealand wealth management]following the transition of the mandate to an index investing strategy, announced earlier this year, in line with market trends,” added Mr. George.

“Our private markets teams continued to invest on behalf of our infrastructure clients and grow their pipeline of opportunities.

“We are clearly focused on our priorities going forward, including the separation of our private markets business from AMP in the first half of next year.”

[Related: People’s Choice surpasses $8bn milestone]

AMP Bank’s loan book grows by $300 million in third quarter

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Last update: April 05, 2022

Posted: October 22, 2021

Sam Nichols

Sam Nichols is a journalist at The Adviser and Mortgage Business. His reporting has appeared in a range of outlets including ABC News, SBS’ The Feed and VICE.

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