George leaves AMP smaller but healthier
ANALYSIS
Alexis George has overseen the transformation of AMP Limited from being a major investment manager, master trust and financial planning business to now being the home of a competitive investment platform, a small-to-mid-sized bank and a retail master trust.
AMP had officially exited its life insurance business a year before George assumed the helm but she oversaw a substantial part of the eventual sale of AMP Capital in 2023 and the company’s exit from its financial planning licenses in 2024.
As a result, the AMP platform business, AMP North has become the jewel in the company’s crown, while its superannuation business has progressively rebuilt from the reputational damage inflicted by the Royal Commission into misconduct in the Banking, Superannuation and Financial Industry.
Amid business media speculation in late December and early January about AMP being a potential bidder for Colonia First State (CFS), the company has announced that George is being succeeded by the Chief Financial Officer, Blair Vernon.
But to weigh George’s performance leading AMP, you have to look at what she inherited when she took the helm in April, 2021 from Francesco De Ferrari just two years into what was supposed to be a three-year strategic overhaul of the company.
It must also be remembered that in 2018 major research and ratings house, Morningstar, was moved to describe the royal commission as having been an “unprecedented disaster” for AMP.
“AMP’s heritage brand has been trashed and its long-term strategy is now uncertain,” Morningstar analyst, Chanaka Gunasekera said at the time.
The ratings house followed up in early 2021 referencing “A damning Royal Commission, the exit of chief executive Francesco De Ferrari – who oversaw multiple senior departures and a 50 per cent collapse in the share price – an internal revolt by female staff to sack the man at the centre of a sexual harassment controversy, and now a failed takeover deal with Ares Management”.
In the end, AMP offloaded AMP Capital in stages – the Global Equities & Fixed Income (GEFI) unit went to Macquarie in 2022, and the Real Estate & Domestic Infrastructure Equity (Collimate Capital) went to Dexus in 2023.
AMP had simplified its business to focus on banking and wealth in Australia and New Zealand with the loss-making financial planning business gone by the end of 2024.
Thus, it can be said that George came to an unenviable prospect in becoming CEO and managed to navigate a process of placing it more firmly back in the black by selling assets and exiting unprofitable or difficult businesses.
The bottom line for George is probably best spelled out in the company’s first half results which revealed underlying net profit after tax (NPAT) up 9.2% to $131 million but statutory NPAT down 4.9% predominantly owed to the company’s spend on its business simplification program.
The question for shareholders is whether, with the balance sheet repair work substantially done, Vernon can take the next steps.
I hate AMP with a passion but she did a good job. Hopefully the company goes back to form and does something stupid and goes the same way as Blockbuster Video.