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Distressed customers are contacting AMP’s call centre seeking to draw down their superannuation to help fund their mortgage repayments, as economic uncertainty and high-interest rates continue to weigh on Australians.
While the proportion of AMP mortgage holders behind on repayments is only 3 per cent, it has gone up from 1 per cent six months ago, and is expected to rise as an increasing number of customers come off their fixed-interest loan over the next few months, chief executive Alexis George said after releasing the group’s 2024 half-year results.
AMP chief executive Alexis George says a proportion of the community continues to feel the bite of high interest rates. Credit: Aaron Francis
“If you look at our customer base, there is an element of customers and the community doing it really tough, and you can see that in the arrears showing up in our [loan] book,” George said.
“You can see it in our call centre, you can hear it in our customers’ voices. People are looking for avenues to draw down their super. We’re in a situation economically, it’s still OK, but there is an element in our community doing it tough.”
The proportion of AMP Bank customers who are on time with their mortgage repayments has fallen 1 percentage point to 14 per cent in the past six months, while those who are ahead has increased 1 percentage point to 27 per cent.
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The group’s banking division reported net profit after tax of $35 million, a 40 per cent fall compared to the same period last year. Its net interest margin – a measure of profitability comparing its funding costs with what it charges for loans – fell from 1.39 per cent to 1.14 per cent in a year amid continued competitive pressures.
The financial services group overall was resilient, with underlying net profit after tax rising 5.4 per cent to $118 million compared to the same period last year. Total revenue fell 4 per cent to $641 million.
AMP on Wednesday announced it would sell its Advice licences, as well as its self-licences offer Jigsaw $10.2 million to Entireti. AMP will retain a 30 per cent holding in the new company, but warned it would incur a $30 million loss from the sale of its advice business over the next six months.