Troubled financial services company AMP saw record net outflows from its wealth management business in the third quarter as a client exodus after misconduct revelations gathers pace.
In an update on its assets under management issued to the Australian Securities Exchange on Thursday, AMP revealed that it experienced net cash outflows of A$1.9bn in the three months to September 30, a 30% increase year on year.
AMP said A$200m of the outflows came as the result of the government's new Protecting Your Super legislation, which led to the introduction of fee caps and the transfer of inactive low-balance accounts to the Australian Taxation Office.
Australian wealth management is taking significant steps to reinvent its business model, building a business around client needs"
Chief executive Francesco De Ferrari attributed the outflows in part to legislation designed to return funds from dormant accounts to customers.
"Australian wealth management is taking significant steps to reinvent its business model, building a business around client needs," chief executive Francesco De Ferrari said.
"We have achieved stronger inflows during Q3, reflecting our improved fee competitiveness, but also higher outflows as the new Protecting Your Super legislation was implemented in Australia."
The Australian government released legislation aimed at reducing insurance and fee costs for customers, including requiring companies to transfer inactive low-balance accounts to the Australian Taxation Office and cancel insurance for inactive members.
Despite the outflows, total assets under management for the Australian wealth management unit at end-September rose to A$133.2bn, compared with A$132.70bn as of June 30, it said.
In August, AMP posted its biggest half-year loss since its listing, and withheld dividend for the first time, a year after the Royal Commission inquiry found the company had for years wrongfully charged fees and had attempted to mislead the regulators.