AMP chief executive Andrew Mohl looks set to completely overhaul the
company's UK Financial Services strategy as he gets his chance today to convince
investors that the group's prospects will improve.
British reports this week have already suggested Mr Mohl will disband Pearl's
direct sales force, probably adding 1000 job cuts to the 1500 already slated
across the UK operations by his predecessor Paul Batchelor.
Such a move would see AMP follow the trend of several large UK insurers who
are relying on third party or independent distribution to sell their financial
products, a channel that is considered more cost-effective. But this would
represent a big departure from the strategy outlined last year by the now-exited
UK Financial Services boss Tom Fraser who, along with Mr Batchelor, saw merit
in running both forms of distribution alongside each other.
AMP shares closed steady at $13.30 ahead of this morning's much-anticipated
strategy briefing, which is expected to focus on the company's ongoing strategy
in the UK, including which distribution channels, products and market segments
will be pursued.
AMP is also expected to update the market on its regulatory solvency position
in the UK, which should have improved following measures to free up capital and
an improvement in the depressed British stockmarket.
The benchmark FTSE100 is down 20 per cent in the year to date.
In a bad sign for the market though, rival Prudential reportedly has cut
bonuses to policyholders for the third time as it protects its funds.
Still, Mr Mohl appears to have won the market's tentative support in his
``Following the disappointments of incumbent leaders of the AMP through the
last half a dozen years, we feel a lot more comfortable with the leadership
direction of the AMP under Andrew Mohl," commented Constellation Capital
Management's managing director, Doug Little.
The troubled financial services company could also provide more detail on
last month's planned $1.2 billion writedown, which largely related to goodwill
on its National Provident Institution business and several emerging operations,
including AMP Bank and Virgin Money, and the prospects of further writedowns.