May 28, 2022

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Ameriprise Wealth Management Assets Grow 22% As Recruiting Picks Up

Ameriprise Financial reported strong organic growth in its advice and wealth segment in its third quarter 2021 results, with total client assets up 22% year-over-year to $811 billion. Total client inflows were $10 billion during the quarter, bolstered by a 65% increase in advisory flows and a 16% increase in brokerage activity.

The company attributed the organic growth to deeper client relationships from existing clients and new client acquisition.

“You’ve seen a nice uplift from where we were, based upon the integrated technology and the solution and the advice modules we’ve been putting to market that really help the advisors engage a larger part of their client base and deepen appropriately,” said Jim Cracchiolo, Ameriprise chairman and CEO, on an earnings call. “We also have added a lot of capabilities for them in our CRM systems, etc. to reach out to even more prospects and move upmarket more. We’re seeing a combination of things that are adding to that total flow picture, but what’s really important is the level of client and advisor engagement on things, and so we think that that has given us that level of uplift.”

Cracchiolo added that external recruitment of advisors has picked up, as the firm moved from a more virtual approach to in-person. Total advisor count was at 10,073, up 2% from a year ago and up 26 advisors sequentially. In the employee channel, headcount was down 1% from the year-ago quarter.

“We feel like we have a good opportunity as people better understand the type of capabilities that we offer, the brand support that we provide, as well as the recognition that we’re getting there from a client perspective,” Cracchiolo said.

Average advisor productivity reached a record $766,000 on a trailing 12-month basis, up 15% from a year ago and 18% if you exclude the decline in short-term interest rates. 

The advice and wealth management segment reported pre-tax adjusted operating earnings of $459 million, up 43% year-over-year, which the firm attributed to “robust client net flows, higher transactional activity, market appreciation and disciplined expense management.” Adjusted operating net revenues were $2 billion, up 23%, due to client net flows and market appreciation.

Overall, Ameriprise posted adjusted operating earnings of $5.86 per share, beating analysts’ expectations by 37 cents, on revenue of $3.5 billion, up 18% year-over-year, beating expectations by $12.88 million.