AMP LIMITED — AGM Information 2017

May 10, 2017

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11 May 2017

Manager Client and Market Services Team ASX Market Announcements NZX Limited Australian Securities Exchange Level 1, NZX Centre, 11 Cable Street Level 4, 20 Bridge Street PO Box 2959 Sydney NSW 2000 Wellington, New Zealand Announcement No: 13/2017 AMP Limited (ASX/NZX: AMP)

Annual General Meeting

Part One: Chairman’s Address to Shareholders

Part Two: CEO’s Address to Shareholders

Please refer to the attached documents.

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Public Affairs T 02 9257 6127 E media@amp.com.au W AMP.com.au/media AMP_AU

AMP Limited 33 Alfred Street, Sydney NSW 2000 Australia ABN 49 079 354 519

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ADDRESS BY AMP CHAIRMAN CATHERINE BRENNER TO THE AMP ANNUAL GENERAL MEETING 11 MAY 2017

It has been such a privilege to serve as a director of your company for the past six years and, following a rigorous selection process, I was humbled to have been asked by my colleagues to become Chairman.

I am very conscious of the tremendous honour and responsibility of chairing the board of AMP.

For me, it is a very special organisation.

It was founded in 1849, as the then Australian colonies were emerging from economic depression.

A clergyman, an entrepreneur and a wool merchant devised a plan to form a provident society which would encourage people to provide for their present and future financial security.

They founded AMP on a simple, yet bold idea - that every person should be able to live their life with financial dignity.

Almost 170 years later, this idea remains the cornerstone of our organisation. Today we call this ‘helping people own tomorrow’.

This strong sense of social purpose, born from our origins as a provident society, drives the AMP culture and underpins all we do.

As you saw in the video, each year, AMP helps over four million customers across Australia and New Zealand work towards achieving their financial goals.

In doing so, we serve as the steward of their financial futures.

That is a very important responsibility that both I and your board, treat very seriously.

Board renewal and introductions

Turning for a moment then to your board.

Since taking the chair some nine months ago, I have been honoured to lead a period of board renewal. We have deliberately sought to build and strengthen the board’s skills and experience aligned to the company’s strategy and to continue to improve board diversity.

For us, diversity extends well beyond gender, although we are proud to have met our target of 40% female representation on the board. At AMP, we believe in diversity of thought and we are working hard to ensure an appropriate mix of skills, ethnicity, styles, age and experience to support the delivery of the company’s strategy.

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To this end, I am absolutely delighted with the depth and breadth of skills and experience in your new board, as today, we welcome a number of new directors.

As I mentioned, I am going to ask each of my fellow directors, whether they are standing for election or not, to say a few words to you, so you have a real sense of the people who act as your representatives. We will then deal with the formal election and re-election of the directors, later in the meeting at item 2.

I am very confident that we have in place a strong board with not only wonderful and relevant collective expertise but also great passion for AMP and its noble purpose and a genuine commitment to drive stronger returns to shareholders.

Your board and management are acutely aware that there is a long-held perception that AMP has never quite fulfilled its true potential.

Together, we are determined to fix this.

2016 business performance

To this end, both the board and management acknowledge that the company’s performance in 2016 was disappointing.

It was a very difficult year for AMP.

Good performances in most of our businesses were overshadowed by a significant loss in insurance.

Escalating claims volumes saw us take action to reset and stabilise this business. But the reset meant taking a large write-down in our insurance book, which, in turn, led to a net loss at the group level for 2016 of $344 million.

While the insurance write downs were largely non-cash, the results impacted investor sentiment and our share price.

Behind the headline numbers, we delivered good results in several areas, particularly AMP Bank, AMP Capital, and the New Zealand business, which all delivered operating earnings growth.

Our Australian Wealth Management business was also broadly resilient despite challenging market conditions and regulatory change.

Notwithstanding the insurance losses, the company remained financially strong and very well capitalised, finishing the year with more than $2.2 billion surplus capital above minimum regulatory requirements.

The extent of this financial strength and the board and management’s confidence in the future of AMP, meant that we were able to maintain our dividend at 28 cents per share and announce an on-market share buyback.

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We began the buyback on 14 March, and have so far returned nearly $150 million to shareholders, by purchasing and then cancelling shares. All other things being equal, the buyback improves our earnings per share and is in the best interest of shareholders. So as things currently stand, this is our preferred way of using any excess capital.

Stepping back then, while 2016 was a challenging year in terms of performance, we did maintain a strong financial platform on which to take the business forward. As a board and leadership team, we are absolutely united in our commitment and resolutely determined to drive stronger growth and improve returns to shareholders in 2017 and beyond.

Thematics shaping AMP’s strategy

So, let’s turn to look at the future.

The business environment is changing – and changing rapidly.

We are witnessing demographic, social, behavioural, regulatory and technological change all of which is actively influencing our strategic choices and shaping AMP’s future.

The extent and pace of change creates both challenge and very real opportunities for AMP.

But five strong, positive thematics stand out:

The first is a global demographic shift and the undeniable fact that the world’s population is ageing.

In a little over a century, human life expectancy has almost doubled[1] .

Today, it is around 80 years for men and nearly 85 for women[2] .

In Australia, by 2064 there will be 9.6 million people (or 23% of the population) aged over 65 and 1.9 million people (some 5% of the population) aged over 85[3] .

This has important consequences for how we manage our increasing longevity as a society, with profound implications for how we manage health and most importantly for AMP, wealth.

Some 30 years ago, as a nation, Australia showed great foresight in addressing this challenge introducing a superannuation system designed to incentivise and build a longterm savings culture.

1 Max Roser (2017) – ‘Life Expectancy’. Published online at OurWorldInData.org.

2 Based on a boy or girl born 2013-3015. ABS 2014a, ABS 2016, Table S1

3 ABS 2013. Population Projections, Australia, 2012 (base) to 2101. Cat. no. 3222.0 Canberra: ABS

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As a result, today Australia is the third largest fund management market in the world and the Australian wealth management system holds $2.2 trillion[4] in assets – with the superannuation system expected to grow at around 6% over the next five years.

By any standards, this makes Australian wealth management an attractive growth market. And, AMP, as the market leader for superannuation and advice, it is exceptionally well placed to benefit from this mandated growth.

Coupled with this trend is the ageing of wealth.

As the population ages, the skew of wealth moves towards the older generation, who are living longer in retirement and therefore seeking yield to make their income last.

We see this trend as structural not cyclical and it is driving demand for expertise in alternative, real assets – specifically infrastructure and property.

These are higher margin, higher growth asset classes offering attractive returns for investors and higher growth for AMP.

Again, AMP is well placed to capitalise on this trend. We are among the top 20 global infrastructure managers in the world and are one of the largest property investment managers in the Asia Pacific region.

The second and in fact somewhat linked thematic for AMP is the shift in the world’s economy.

During the next two decades, the world economy is expected to shift from west to east – and north to south.

The rise of Asia as an economic powerhouse is clear. With China’s economy, specifically, expected to grow as we move further into the Asian Century.

Australia’s proximity to Asia, along with our strong economic and cultural ties, present our nation – and AMP specifically – with enormous growth potential.

To put this in context, Australia is not alone in facing the demographic challenge.

In the world’s largest nation – China - the over 60’s population is expected to more than double - to 440 million people by 2050. In the same timeframe, China also expects to have 100 million people over the age of 80[5] .

Interestingly, in testament to the Australian system, China has chosen a very similar pensions and superannuation model to address their ageing population challenge. Importantly for AMP, through a patient, long-term approach, we have built a very strong partnership with a formidable business partner – China Life.

4 APRA, Quarterly Superannuation Performance to December 2016.

5 World Ageing Population 2009, United Nations, Department of Economic and Social Affairs (Population Division)

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China Life is the world’s largest listed life insurer, with a pan-China presence and a network of some two million agents. Selected for our understanding and expertise in the Australian pensions and funds management market, AMP and China Life have formed two very successful joint venture companies – both of which are performing ahead of expectations:

• China Life AMP Asset Management, of which we own 15 per cent, has some $22.9 billion assets under management, is now the fastest growing fund manager in China – and therefore, arguably the world.

• And the China Life Pensions Company, of which we own 19.99 per cent, is the market leader for trustee services and in the top 3 for investment management.

The third trend is the impact of technology.

We are in an era where the rate of innovation and speed of technological change are unprecedented.

Technology is driving levels of change that some suggest has been greater in the last 10 years than over the last 100.

We are facing what futurists are calling the ‘second machine age’[6] - a future where artificial intelligence, smart homes and driverless cars will re-shape how we live our day-today lives.

We believe that while technology is creating disruption it is also creating opportunity.

It is shifting customer demands, needs and expectations. It is both enabling and driving greater demand for transparency. And it is making the ability to interact easily and seamlessly with companies across multiple channels – the new norm.

Yet, harnessed intelligently, technology is simultaneously creating opportunity to drive far greater efficiency.

Behind the scenes, we have been quietly investing, building an innovative, technologyenabled, goals based operating system in our Australian business, leveraging state-of-theart data and analytics systems allowing seamless customer omni-channel interaction.

And, we have fully embraced technology as a driver of cost efficiency. As an example, we were the first Australian company to move to the cloud – partnering with Amazon Web Services. This has reduced our IT infrastructure spend and enabled us to reduce delivery times for customers while keeping their data safe.

The fourth trend underpinning our strategy is the changing nature of consumer behaviour and specifically the growing human desire for experiences, rather than products. Research shows that increasingly, we’re spending money on travel, entertainment, and education – experiences that make us feel good. In fact, psychology experiments found that people tend to feel happier after buying an experience, rather than a product[7] .

6 Brynjolfsson, Erik and McFee, Andrew, The 2nd Machine age: Work, Progress and Prosperity in a time of…, 2014.

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We have been reshaping our business to focus on differentiated, goals based experiences rather than products to stay-ahead of this trend.

The fifth trend revolves around regulation.

Post the global financial crisis, the financial services industry has come under intense scrutiny and the level of regulation has increased exponentially.

Since 2009, the Financial Services Council has recorded some 22 inquiries, reviews and investigations into the Australian banking and financial services sector with a further 17 currently underway. The cost to industry of reform and review over the last five years is estimated to be approaching some $3 billion[8] .

AMP has always welcomed and supported regulatory reform that is in the best interests of customers.

We continue our long history of working with both regulators and the industry on improving outcomes and creating the policy of the future.

To us, regulation again presents both a challenge and an opportunity.

There is no doubt that the implementation of the Future of Financial Advice reforms and readying our advice network for the impending change to life insurance, educational standards and super reforms has been costly, time consuming and challenging.

But the investments we have made in automating and industrialising the back end advice processes mean we are well placed to capitalise on regulatory change and reinforce AMP as the natural home for advisers of the future.

In fact, we have been investing to address and stay ahead of each of these five trends.

But by their nature, these have been long-term investments:

• Investments in building a revolutionary new operating system – that will see us change the way we compete and win in wealth management in future.

• Investments in building partnerships in China and Japan which will broaden our geographic presence and scale – capturing meaningful growth in Asia;

• and investments in taking our in-house expertise in infrastructure and property management offshore.

However, in light of our 2016 performance, we’ve also taken steps to rebalance these investments in long-term growth with a far stronger focus on short-term performance – to deliver stronger returns to you – our shareholders – in both the short and long term.

7 Hajkowicz, Cook and Littleboy, ‘Our Future World’, CSIRO, 2012 revision, p 21.

8 Financial Services Council, FSC Leaders Summit, 20 July 2016.

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Conclusion

So, reflecting for a moment and summing up.

2016 was undoubtedly a challenging year for AMP and we understand and acknowledge that many shareholders are disappointed with the short term result.

Your board and management are absolutely determined to drive stronger growth, deliver improved returns to shareholders and realise AMP’s true potential.

To this end, we have been rebalancing investment in long-term growth with a far sharper focus on short-term performance. Craig will provide more detail on this shortly.

I would like to conclude by thanking Craig, his leadership team and the many thousands of dedicated people who work for AMP for their constant effort, enthusiasm, and commitment. I would also like to acknowledge my fellow directors for their passion and tireless commitment and most importantly, to thank you, our shareholders, for your continued interest and support.

Thank you.

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ADDRESS BY AMP CEO CRAIG MELLER TO THE AMP ANNUAL GENERAL MEETING 11 MAY 2017

Thank you Catherine – and good morning ladies and gentlemen.

Today, I’d like to talk about our 2016 business performance and to share with you our thinking on strategy as well the actions we are taking to drive growth and deliver much stronger outcomes for shareholders in 2017 and beyond.

2016 business performance

2016 was undoubtedly a challenging year for AMP.

The bottom-line result, a fall in underlying profit to $486 million and in net profit to negative $344 million, was very disappointing and was largely attributable to challenges faced in our insurance business.

So, let’s look at each of our businesses starting with Insurance .

Through the course of 2016, we saw significant deterioration in the insurance market driven by increased international competition, pricing pressure and an unprecedented level of insurance claims.

After a significant review, we decided that the changes in the sector were structural, not cyclical. And so, at the end of the third quarter, we took decisive action to stabilise and reset the business, reducing the impact insurance would have on future group earnings.

Specifically:

• we strengthened our best estimate assumptions – which is our view of the future level of expected claims. Doing so, crystallised a significant, one-off, capitalised loss of $484 million and a goodwill write-down in the order of $668 million.

While these were largely non-cash losses, reflecting the accounting treatment applied to insurance, they still clearly impacted our financial results leading to the bottom-line loss.

• We also entered into a reinsurance agreement with a major global reinsurer Munich Re.

Reinsurance effectively acts as insurance for insurers, so the deal, while reducing future profit margins, also helped to reduce our exposure to future volatility and released $500 million of capital that we were required to hold against future claims.

• We also consolidated our two insurance books, AMP Life and NMLA life which released a further $145 million of capital.

• The capital released from these two initiatives gave us the capacity to return capital to shareholders via an on-market buy back.

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These actions were taken to stabilise the insurance business and minimise future impact on group earnings from the division. Importantly, the Q1 results announced this morning demonstrate that the actions are working and that the insurance business is now performing in line with our revised assumptions.

Now to wealth management.

And in our wealth management business, we retained our position as Australia’s leading, specialist wealth manager.

However, this business was also buffeted by a range of challenges in 2016.

Volatile share markets, as well uncertainty created by the changes to Australia’s superannuation legislation announced in the Federal Budget last year, meant customers took a far more cautious approach to topping up their super.

We saw the impacts most markedly in our cashflows, particularly in the second and third quarters. We were not alone - with the volatility and uncertainty reflected in subdued cashflows across the industry.

Despite the difficult operating environment, the business delivered broadly steady results, with earnings softening by 2% as we worked hard to offset the challenging conditions with tight cost control.

Nevertheless, our wealth management business is in a very strong position.

We are Australia’s largest superannuation provider in a $2.2[1] trillion market that is predicted to double by 2026[2] .

We are also Australia’s leading provider of financial advice and the market leader in self managed super fund administration services.

And, over the past four years, the business has delivered strong compound average growth in profits of almost 9%.

Turning to our specialist investment manager. AMP Capital has been a strong and consistent performer with the business delivering compound growth in profits of 10% over the past five years.

In 2016, the business continued this positive growth trajectory with strong global demand for our investment expertise in property and infrastructure and good performance in these asset classes helping to drive a 4% increase in operating earnings.

And, as Catherine mentioned, our partnership with China Life, the world’s largest listed life insurer, also continued to go from strength to strength, with our two joint ventures both growing rapidly and delivering ahead of expectations.

All up, we’re happy with how AMP Capital is performing and very excited about the international growth potential the business offers.

1 APRA Quarterly Superannuation Statistics December 2016.

2 Dynamics of the Australian Superannuation System, The Next 20 Years: 2015 – 2035, Deloitte, November 2015; AMP modelling.

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AMP Bank is also a great growth story.

It has almost doubled its operating earnings and delivered a compound growth rate in profits of almost 18% over the past five years.

In 2016, the bank’s profits were up, net interest margin was wider and we drove above system growth in both residential home loans and deposits while tightening credit criteria.

In short, we continued to grow the business while maintaining a falling cost to income ratio and delivering a high return on capital.

With approximately 1% market share in an expanding market, we see significant further growth potential for the bank.

Our New Zealand business also had a pretty good year.

It delivered good growth in profit margins, off the back of a stronger wealth management business and strong cost management.

And it did so while offsetting the full impact of the loss of transitional tax relief.

Costs and capital

Throughout the year, we also managed costs tightly right across the business, completing our business efficiency program and delivering $200m recurring savings.

Our capital position also remained strong and well above minimum regulatory requirements.

This capital strength meant that, despite the challenges faced in 2016, we were able to hold the dividend steady at 28 cents and return capital to shareholders through the onmarket buy back which we launched in March this year.

This is a strong indication of the deep financial strength of this business and our ability to continue rewarding shareholders even during what we acknowledge was one of our most difficult years.

So, that’s the summary of 2016, let me now spend some time looking forward.

Strategy

As the Chairman outlined, the world is changing – and changing rapidly.

The many areas of change that Catherine shared this morning create both challenges and great opportunities for AMP.

They are influencing our strategic choices, impacting not only ‘where we will play’ - in terms of the geographies and segments we choose to operate in - but also ‘how we will compete’ and win in our chosen markets.

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We have already been investing heavily for a disrupted world.

So, let me share with you our thinking - looking first at ‘where we will play’.

We look to operate in:

• large and growing markets;

• where competition is rational;

• and most crucially, where AMP has a distinctive competitive advantage. We see these distinctive strengths in advice and superannuation (known collectively as wealth management) and in investment management – particularly the management of infrastructure and property assets.

• We have been, and continue to, tilt investment to our higher growth businesses, releasing and recycling capital from our lower growth, more capital intensive businesses to accelerate growth.

From a geographic perspective, this means Australian wealth management with its attractive, mandated market growth will remain the core engine of AMP’s near-term growth. But we will increasingly leverage our strengths into new geographies - including China, Japan, Europe and America - to drive medium to longer-term growth.

How we will compete and win will vary by market.

In Australia – the way we compete is changing.

Historically, we have operated in all aspects of the wealth management value chain – advice, product (with super, insurance) and investment management. We have run our advice businesses broadly to break-even – viewing them as a distribution channel for product – where we have made our profits.

In short, in the past we were an advice and product-led business.

Our future strategy has evolved to be purpose-led – guided by our enduring promise of helping people own tomorrow.

It starts with the customer and more specifically the goals they want to achieve.

As we heard from Catherine earlier, our customers want everything easier, faster and cheaper.

Yet, every day, we see hundreds of people who need help sorting out their money. As we all know only too well, organising your finances – investments, tax, superannuation, housing – takes time, effort, technical knowledge, acumen and confidence.

Yet, talking about products – like superannuation and insurance - simply doesn’t engage [many] people. In fact as an industry, we’ve not done a good enough job of creating a compelling proposition to help people better organise their finances.

This is borne out in research which shows that while four in 5 people need advice, only 1 in 5 seek it.

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So, we’ve been re-thinking and re-designing the way we deliver help.

Our experience has shown that the best way to engage people in their finances is to focus on the broader goals they are trying to achieve.

We have found these goals are largely consistent from individual to individual with the emphasis changing throughout life – from simplifying your finances, to owning your own home, protecting those you love and retiring right.

So we’ve been building a new, goals based, technology-enabled operating system to underpin our Australian wealth management business.

It is a system that builds on our historic strength in face to face advice – recognising the very real need for human interaction – as we have found that humans still want (and need to talk) to other humans to make the larger, life-shaping financial decisions.

It is a unique operating system that blends technology and human interaction – making help and advice more accessible to more Australians, more often. Letting our customers choose how they interact with us – be it by phone, online or face to face – or all three depending on their needs and stage of life.

And behind the scenes, it is an operating system that will make the process of providing help and advice far more efficient, consistent, and productive – for AMP and for our advisers.

Given Australians love for property – the system wraps in our banking and debt solutions. In fact, our bank provides components to over half of our new goal based solutions. As does our investment manager, with most goals needing an investment solution to provide a tailored outcome with different degrees of risk.

It is an operating system, that allows us to better help those customers who come to us via their company’s superannuation scheme – creating a real relationship with them early in their financial life - based on their goals.

This new goals based operating system is not an ambition. It is operating today in around 24 AMP Advice practices across the country.

By applying the system, we believe we can change the traditional economics of and the way we compete in wealth management. We will generate more margin from advice, which will offset the margin compression we are seeing in product and provide us with greater flexibility to compete on price to continue to drive volume without impacting overall profitability.

The final piece of our wealth management solution is our self managed superannuation fund business, SuperConcepts, which is capturing growth from the increasing popularity of SMSFs.

We entered the SMSF business five years ago and have built quickly to managing just under 10% of the software and administration market. Our assets under administration have reached $22.5 billion.

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We have grown via acquisition in this business and are now moving all the businesses we’ve acquired onto one platform to capture the benefits of our scale in this market. Increasingly, we are seeing SuperConcepts generate revenue not just via the provision of admin services but as a platform, creating new revenue generating capacity for our Australian wealth business.

Looking at the drivers of medium-term growth, we will take our core capabilities in wealth and investment management offshore.

AMP Capital has provided a model for this type of growth to date – using our globally renowned expertise in infrastructure and property management to build an increasing presence, profile and income stream from both Europe and North America.

In China, the focus of growth is via partnership with our market-leading Chinese partner – China Life.

• here, our pensions expertise is offering exciting growth potential as the Chinese government move to adopt a pensions approach modelled on Australia’s system;

• our investment management expertise is also driving growth; and

• as we opened our first goals store in China earlier this year, China Life has proven the interest and potential to drive international growth by licencing our new Australian, goals-based operating system to other organisations in different geographies.

Managing for value and capital efficiency

In those businesses, with slower growth or where we do not have distinct competitive advantages – including insurance, New Zealand and the Mature portfolio – we will manage for value and capital efficiency, continuing to extract strong returns for investors.

These businesses have a strong embedded value, built from running them successfully for many years.

Managing for value means realising as much of this embedded value as soon as possible, whilst continuing to ensure we provide a high quality customer experience.

In the case of our insurance business, we are currently achieving this through reinsurance – with a major deal signed last October and a second tranche progressing well.

Costs

Our strategy in all business lines across all geographies will be underpinned by a continuing focus on costs and efficiency.

This will be ever more critical in our business – with an ongoing mindset of actively seeking every opportunity to drive efficiency and reduce costs.

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So, the AMP of tomorrow will be fundamentally different from today.

Looking five years out:

AMP will be a unique financial services company – focused on delivering outstanding customer experiences and superior total shareholder returns.

We will have clear focus on customers, with a differentiated goals based approach in our core Australian wealth management business;

We will leverage our strengths in advice, pensions, wealth operating systems and our expertise in real asset investment management to drive medium-term growth offshore.

And, we’ll have a streamlined portfolio focused on growth, releasing and recycling capital from our lower growth business lines and, in doing so, will create the capacity to invest for growth.

Conclusion

In conclusion then, 2016 was a particularly challenging year, but despite the headwinds faced, the underlying financial strength of AMP was clear:

• We maintained the dividend, funded out of free cashflow, and we launched a share buyback

• We took action to reduce volatility of returns arising at a group level from insurance and to reduce our capital exposure to this business,

Moreover,

• We maintained our leading positions in the Australian and New Zealand wealth management markets and continued to grow our position in banking;

• We delivered increased international expansion in Asia through our strong partnerships with China Life and MUTB, and in Europe and North America through our in-house capability and expertise in real asset management; and

• We have taken decisive action to drive AMP towards a stronger future, setting a clear strategy for growth.

As a board and leadership team, we are absolutely determined to improve performance, to drive returns and to realise the true potential of AMP.

Thank you for your ongoing support and your continued interest and investment in AMP.

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