AMP LIMITED - Interim / Quarterly Report 2011

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18 August 2011

Manager Manager Company Announcements Office Australian Securities Exchange Level 4, 20 Bridge Street Sydney NSW 2000

Market Information Services Section New Zealand Stock Exchange Level 2, NZX Centre, 11 Cable Street Wellington New Zealand

Announcement No: 42/2011

AMP Limited (ASX/NZX: AMP) (also for release to AMP Group Finance Services Limited (ASX: AQNHA & NZX: AQN010))

Part One: Appendix 4D Part Two: AMP delivers A$455 million underlying profit for first half of 2011 AMP 2011 interim dividend information AMP Financial Summary 1H11

Part Three: AMP Financial Services Cashflows Q1 and Q2 2011

Part Four: Investor Presentation Part Five: Investor Report

Part Six: Directors’ Report & Financial Report

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AMP Limited ABN 49 079 354 519

Directors’ Report and Financial Report for the half year ended 30 June 2011

AMP Limited

DIRECTORS’ REPORT

for the half year ended 30 June 2011

Your directors present their report on the consolidated entity consisting of AMP Limited and the entities it controlled at the end of or during the half year ended 30 June 2011.

Directors’ details

The directors of AMP Limited during the half year ended 30 June 2011 and up to the date of this report are shown below. Directors were in office for this entire period, except where stated otherwise.

Peter Mason AM, Chairman – BCom (Hons), MBA, Hon DBus (UNSW), FAICD Craig Dunn, Managing Director and Chief Executive Officer – BCom, FCA Patricia Akopiantz – BA, MBA (appointed 31 March 2011) Richard Allert AO – FCA (appointed 31 March 2011) Catherine Brenner – BEc, LLB, MBA Brian Clark – DSc Paul Fegan – MBA Richard Grellman AM – FCA (retired 12 May 2011) John Palmer ONZM – BAgrSc, FNZID Nora Scheinkestel – LLB (Hons), PhD, FAICD Peter Shergold AC – BA (Hons), MA, PhD, FAICD

Principal activities

AMP is the leading independent wealth management company in Australia and New Zealand, with an evolving banking business in Australia and selective investment management activities in Asia. It provides financial advice, products and services to help people and organisations build financial security.

In March 2011, AMP merged with the Australian and New Zealand operations of AXA Asia Pacific Holdings Limited (AXA). AXA’s earnings since the merger have been reported separately in AMP’s 1H 11 financial results and will be incorporated into AMP’s existing reporting structure for its FY 11 results.

The combined AMP-AXA group has over four million customers in Australia and New Zealand, more than 6,000 employees and 4,000 aligned planners, around 965,000 shareholders and $159 billion of assets under management. It also holds number one rankings in key segments of the Australian and New Zealand wealth management markets.

AMP Financial Services

AMP Financial Services provides customers in Australia and New Zealand with financial advice, superannuation, retirement income and other investment products, superannuation services for businesses, income protection, disability, life insurance, selected banking products and distribution of general insurance products. These products and services are primarily provided through a network of around 2,150 aligned and employed financial advisers and planners in Australia and New Zealand, as well as through extensive relationships with independent financial advisers.

AMP Bank offers a range of products, and is focused on broadening the group’s customer base. At 30 June 2011, AMP Bank had over 110,000 customer accounts with a mortgage portfolio of $11.0 billion and a deposit book of $5.6 billion.

AMP Capital Investors

AMP Capital Investors is a specialist investment manager, managing around $98 billion in assets for investors. Through a team of 260 investment professionals and a carefully selected network of investment partners, AMP Capital Investors invests in equities, debt securities, property, infrastructure, private equity and multi-manager funds. AMP Capital Investors also provides commercial, industrial and retail property management services. AMP Capital Investors has offices in Australia, New Zealand, Bahrain, Beijing, London, Mumbai, New York, Singapore and Tokyo.

AXA

AXA Australia and New Zealand provides customers in Australia and New Zealand with financial advice, platform administration, superannuation, and life, disability and income protection insurance products. These products are primarily distributed through around 1,850 aligned and employed financial advisers and planners in Australia and New Zealand, as well as through extensive relationships with independent financial advisers.

AMP Limited

for the half year ended 30 June 2011

DIRECTORS’ REPORT

Review of operations and results

AMP operates in one of the largest and fastest growing wealth management markets in the world. The company is financially strong, with a disciplined, prudent approach to capital management. This business model is characterised by a large customer base, scale in key market segments, the largest financial adviser network in Australia and New Zealand, market leading products and platforms, a leading investment management house and a trusted brand.

AMP's statutory profit attributable to shareholders of AMP Limited for the half year ended 30 June 2011 was $349 million, compared to $425 million for the previous corresponding period.

Basic earnings per share for the half year ended 30 June 2011 on a statutory basis was 14.4 cents per share (1H10 20.9 cents per share).

Underlying profit is AMP’s preferred measure of profitability as it smooths investment market volatility stemming from shareholder assets invested in investment markets and aims to reflect the trends in the underlying business performance of AMP. Directors use underlying profit to determine dividends. AMP’s underlying profit of $455 million for the half year ended 30 June 2011 includes an underlying profit of $61 million from the AXA merger for the period 31 March to 30 June 2011. AMP’s underlying profit for the half year ended 30 June 2010 was $383 million . On an underlying basis, earnings were 18.5 cents per share (1H10 18.6 cents per share).

AMP’s performance against key performance measures was as follows:

Underlying profit $455 million, including a 31 March to 30 June 2011 contribution of $61 million from AXA. On a like for like basis, underlying profit was up 3% from $383 million in 1H10.
Growth measures:
AFS net cashflows of $457 million, down from $584 million in 1H 10; AMPCI external net cashflows of $247 million, down from $1,855 million in 1H 10; AXA net cash outflows of $964 million in 1H11, increased from cash outflows of $498 million in 1H10
AFS value of risk new business up $7 million in 1H11 to $52 million; AXA value of risk new business is $37million in 1H11.
69 per cent of AMPCI's funds met or exceeded benchmark over the 12 months to 30 June 2011, up from 64 per cent for the12 months to 30 June 2011.
Underlying return on equity was 18.1 per cent reflecting the merger with AXA and higher capital maintained until regulatory capital standards are finalised.

Total AMP assets under management were $159 billion at 30 June 2011, an increase of 43% from $111 billion at 31 December 2010. The assets under management at 30 June 2011 include $44 billion in relation to AXA.

Differences between underlying profit and statutory profit

The 30 June 2011 underlying profit of $455 million excludes the impact (net of any tax effect) of merger and acquisition transaction costs of $34 million, AXA integration costs of $36 million, amortisation of AXA acquired intangible assets of $22 million and other one-off costs of $17 million. Accounting mismatch losses of $9 million and annuity fair value adjustments gains of $16 million are also excluded from underlying profit as well as a $4 million loss on market adjustments to investment income and risk products. Reconciliation between underlying profit and statutory profit is provided in Note 2 of the Financial Report.

Impact of accounting mismatches on profit

During the half year, the aggregate impact of accounting mismatches decreased the net profit attributable to the shareholders of AMP Limited by $9 million from $358 million to $349 million. Further details on accounting mismatches are provided in Note 1(c) of the Financial Report. The accounting mismatches arise from:

gains and losses on ‘treasury shares’ 1H11: gain of $10 million (1H10: $27 million gain),
gains and losses on investments in controlled entities of the life entities’ statutory funds: 1H11: loss $24 million (1H10: $1 million loss), and
other accounting mismatches: 1H11 gain of $5 million (1H10: $4 million gain).
2 -

AMP Limited

DIRECTORS’ REPORT

for the half year ended 30 June 2011

Capital management

Total AMP statutory equity attributable to shareholders increased to $6,766 million at 30 June 2011 from $2,938 million at 31 December 2010. This was a result of share capital of $3,803 million issued for the acquisition of AXA Asia Pacific Holdings Limited and additional share capital issued under the Dividend Reinvestment Plan, profits to 30 June 2011 and other movements in reserves and contributed equity, partially offset by dividends paid up to 30 June 2011.

AMP remains strongly capitalised, with $2,174 million in regulatory capital resources above minimum regulatory requirements (MRR) at 30 June 2011 ($1,482 million at 31 December 2010). This is 2.1 times MRR (2.4 times at 31 December 2010). The MRR coverage ratio varies throughout the year due to a range of factors, including investment market movements, dividend payments and statutory profits.

AMP continues to take a prudent approach to capital management and has a bias towards holding more capital rather than less in light of continuing market volatility and until future regulatory capital standards (including APRA conglomerates proposals, APRA’s life insurance capital review, Australian implementation of Basel III and RBNZ’s review of NZ life insurance solvency) are finalised.

AMP has declared an interim dividend of 15 cents per share, franked to 30%. This takes AMP’s dividend payout ratio to 81% of underlying profit for the half year ended 30 June 2011. AMP’s dividend policy is to pay out 75 – 85% of underlying profit and franked to the maximum extent possible. As previously forecast, following the merger between AMP and AXA APH’s Australian and New Zealand operations the franking capacity of the merged group will, for the near term, be less than AMP’s recent franking level, reflecting lower franking generation from AXA APH’s operations.

AMP offers a dividend reinvestment plan (DRP) for shareholders. AMP will offer a discount of 1.5 per cent to DRP participants. The DRP will not be underwritten and new shares will be issued.

Events occurring after the reporting date

As at the date of this report, the directors are not aware of any matter or circumstance that has arisen since the end of the half year that has significantly affected or may significantly affect the operations of the consolidated entity, the results of its operations or its state of affairs, which is not already reflected in this report other than the following:

Subsequent to 30 June 2011, global financial and equity markets have exhibited increased volatility. The majority of financial assets recorded in the Statement of financial position are held by the statutory funds of the life entities. Movements in the valuations of these financial assets primarily impact AMP's liability to policyholders and external unitholders in controlled unit trusts such that only a portion of the changes in the valuations for these assets have a direct impact on the shareholders' profit after tax. At times when markets exhibit increased volatility, such as this, AMP dynamically manages its capital position. At the date of this report AMP continues to be strongly capitalised and exceeds all regulatory capital requirements.
On 18 August 2011, AMP announced an interim dividend on ordinary shares of 15 cents per share. Details of the announced interim dividend and dividends paid and declared during the half year are disclosed in Note 13 of the Financial Report.

Rounding

In accordance with the Australian Securities and Investments Commission Class Order 98/0100, amounts in this directors’ report and the accompanying Financial Report have been rounded off to the nearest million Australian dollars, unless stated otherwise.

AMP Limited DIRECTORS’ REPORT

for the half year ended 30 June 2011

Auditor’s independence declaration to the directors of AMP Limited

The directors have obtained an independence declaration from the company’s auditor, Ernst & Young for the half year ended 30 June 2011.

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AMP Limited DIRECTORS’ REPORT

for the half year ended 30 June 2011

Signed in accordance with a resolution of the directors.

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PETER MASON Chairman

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CRAIG DUNN

Managing Director and Chief Executive Officer

Sydney, 18 August 2011

AMP LIMITED ABN 49 079 354 519 HALF YEAR FINANCIAL REPORT

30 JUNE 2011

	TABLE OF CONTENTS
INCOME	STATEMENT ............................................................................................................................................................................1
STATEMENT OF COMPREHENSIVE INCOME.......................................................................................................................................2
STATEMENT OF FINANCIAL POSITION.................................................................................................................................................3
STATEMENT OF CHANGES IN EQUITY.................................................................................................................................................4
STATEMENT OF CASH FLOWS .............................................................................................................................................................6
1.	BASIS OF PREPARATION AND ACCOUNTING POLICIES ....................................................................................................7
2.	SEGMENT INFORMATION....................................................................................................................................................10
3.	INCOME.................................................................................................................................................................................14
4.	INVESTMENT GAINS AND (LOSSES)...................................................................................................................................15
5.	EXPENSES............................................................................................................................................................................16
6.	INCOME TAX.........................................................................................................................................................................17
7.	INVESTMENTS IN FINANCIAL ASSETS AND OTHER FINANCIAL LIABILITIES ..................................................................19
8.	INVESTMENT PROPERTY....................................................................................................................................................20
9.	PROPERTY, PLANT AND EQUIPMENT................................................................................................................................21
10.	INTANGIBLES........................................................................................................................................................................22
11.	BORROWINGS ......................................................................................................................................................................23
12.	SUBORDINATED DEBT.........................................................................................................................................................24
13.	DIVIDENDS............................................................................................................................................................................25
14.	CONTRIBUTED EQUITY........................................................................................................................................................26
15.	CONTINGENT LIABILITIES ...................................................................................................................................................27
16.	EVENTS OCCURRING AFTER REPORTING DATE..............................................................................................................28
17.	MERGER WITH THE AUSTRALIAN & NEW ZEALAND BUSINESSES OF AXA ASIA PACIFIC HOLDINGS LIMITED..........29
DIRECTORS’ DECLARATION ...............................................................................................................................................................32
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF AMP LIMITED ....................................................................................33

Registered Office: Level 24, 33 Alfred Street Sydney NSW 2000 Australia

AMP Limited, a company limited by shares, is incorporated and domiciled in Australia.

AMP Limited Half Year Financial Report

Income statement

for the half year ended 30 June 2011

		Consolidated	Consolidated
		30 Jun	30 Jun
	Note	2011	2010
		$m	$m
Income and expenses of shareholders, policyholders, external unitholders and non-
controlling interests(1)
Life insurance premium and related revenue	3	798	530
Fee revenue	3	893	702
Other revenue	3	147	146
Investment gains and (losses)	4	2,087	(478)
Life insurance claims and related expenses	5	(762)	(647)
Operating expenses	5	(1,492)	(1,099)
Finance costs	5	(444)	(404)
Share of profit or (loss) of associates accounted for using the equity method		5	4
Movement in external unitholders liabilities		(129)	33
Change in policyholder liabilities
- life insurance contracts		58	277
- investment contracts		(823)	1,143
Income tax(expense)credit	6	(6)	205
Profit		332	412
Profit attributable to shareholders of AMP Limited excluding impact of accounting
mismatches		358	395
Unmatched changes in policyholder liabilities ('accounting
mismatches') due to:(2)
- treasury shares		10	27
- investment in controlled entities of statutory funds		(24)	(1)
- other		5	4
Profit attributable to shareholders of AMP Limited		349	425
Profit(loss)attributable to non-controllinginterests		(17)	(13)
Profit		332	412

Footnote:

(1) Income and expenses include amounts attributable to shareholders' interests, policyholders' interests in the life entities' statutory funds, external unitholders' interests and non-controlling interests. Amounts included in respect of the life entities' statutory funds have a substantial impact on most of the consolidated Income statement lines, especially Investment gains and losses. In general, policyholders' interests in the transactions for the period are attributed to them in the lines Change in policyholder liabilities.

(2) As explained further in Note 1(c), accounting mismatches arise because the recognition and measurement rules for certain policyholder assets differ from the recognition and measurement rules for the actual liability to policyholders in respect of the same assets. These mismatches result in policyholder asset movements impacting Profit and increased volatility of the reported profit.

same assets. These mismatches result in policyholder asset movements reported profit.	impacting Profit and increased volatility of the
Earnings per ordinary share	cents	cents
Basic before accounting mismatches	14.6	19.2
Diluted before accounting mismatches	14.5	19.1
Basic after accounting mismatches	14.4	20.9
Diluted after accounting mismatches	14.3	20.8

AMP Limited Half Year Financial Report

Statement of comprehensive income for the half year ended 30 June 2011

	Consolidated	Consolidated
	30 Jun	30 Jun
	2011	2010
	$m	$m
Profit	332	412
Other comprehensive income recognised in retained earnings
Defined benefit plans
- actuarial gains and (losses)	(52)	(38)
- income tax(expense)/credit	15	11
	(37)	(27)
Other comprehensive income recognised in reserves
Cash flow hedges
- gains and (losses) in fair value of cash flow hedges	(12)	(16)
- income tax (expense)/credit	4	5
- transferred to profit for the period	8	19
- transferred toprofit for theperiod - income tax(expense)/ credit	(2)	(6)
	(2)	2
Owner-occupied property
- gains (losses) in valuation of owner-occupied property	(19)	1
- income tax(expense)/credit	1	-
	(18)	1
Exchange difference on translation of foreign operations
- exchange gains (losses)	15	11
- income tax (expense) / credit	-	(2)
-transferred to profitforthe period	-	1
	15	10
Revaluation of hedge of net investments
- gains and (losses) in fair value of hedge of net investments	1	(6)
- income tax (expense)/credit	-	2
- transferred toprofit for theperiod -gross	-	(1)
	1	(5)
Total comprehensive income	291	393
Total comprehensive income attributable to shareholders of AMP Limited	308	406
Total comprehensive income(loss)attributable to non-controllinginterests	(17)	(13)
Total comprehensive income	291	393

AMP Limited Half Year Financial Report

Statement of financial position

as at 30 June 2011

		Consolidated	Consolidated
		30 Jun	31 Dec
	Note	2011	2010
		$m	$m
Assets
Cash and cash equivalents		5,195	3,325
Receivables		2,593	887
Current tax assets		21	8
Inventories and other assets		284	312
Investments in financial assets measured at fair value through profit or loss	7	79,717	66,974
Investments in financial assets measured at amortised cost	7	12,078	10,935
Investment properties	8	7,253	7,122
Investments in associates accounted for using the equity method		113	89
Property, plant and equipment	9	469	452
Deferred tax assets	6	1,234	582
Intangibles	10	4,089	919
Total assets of shareholders of AMP Limited, policyholders, external unitholders and
non-controlling interests		113,046	91,605
Liabilities
Payables		1,835	1,033
Current tax liabilities		238	203
Provisions		454	253
Other financial liabilities	7	3,145	3,062
Borrowings	11	11,092	10,791
Subordinated debts	12	945	345
Deferred tax liabilities	6	778	620
External unitholders liabilities		7,866	5,892
Life insurance contract liabilities		24,313	17,762
Investment contract liabilities		55,302	48,579
Defined benefitplan liabilities		259	67
Total liabilities of shareholders of AMP Limited, policyholders, external unitholders and
non-controlling interests		106,227	88,607

Net assets of shareholders of AMP Limited and non-controlling interests		6,819	2,998
Equity(1)
Contributed equity	14	8,870	5,051
Reserves		(2,557)	(2,565)
Retained earnings		453	452
Total equity of shareholders of AMP Limited		6,766	2,938
Non-controllinginterests		53	60
Total equity of shareholders of AMP Limited and non-controlling interests		6,819	2,998

Footnote

(1) Further information on Equity is provided on the Statement of changes in equity on the following page.

AMP Limited Half Year Financial Report

Statement of changes in equity

for the half year ended 30 June 2011

Consolidated

Equity attributable to shareholders of AMP Limited

					Owner
			Share		occupied	Foreign					Non-	Total
		Equity	based	Cash flow	property	currency	Hedge of net	Demerger		Total	controlling	equity
	Contributed	contribution	payment	hedge	revaluation	translation	investment	loss	Retained	shareholder	interest	$m
	equity	reserve(1)	reserve(2)	reserve(3)	reserve(4)	reserve(5)	reserve(6)	reserve(7)	earnings	equity	$m
	$m	$m	$m	$m	$m	$m	$m	$m	$m	$m
30 June 2011
Balance at the beginning of the period	5,051	1,019	8	(5)	66	(69)	1	(3,585)	452	2,938	60	2,998
Profit	-	-	-	-	-	-	-	-	349	349	(17)	332
Other comprehensive income	-	-	-	(2)	(18)	15	1	-	(37)	(41)	-	(41)
Total comprehensive income	-	-	-	(2)	(18)	15	1	-	312	308	(17)	291
Share based payment expense	-	-	12	-	-	-	-	-	-	12	-	12
Share purchases	-	-	-	-	-	-	-	-	-	-	-	-
Net sale/(purchase) of 'treasury shares'	(101)	-	-	-	-	-	-	-	(1)	(102)	-	(102)
Dividends paid(8)	-	-	-	-	-	-	-	-	(314)	(314)	-	(314)
Dividends paid on 'treasury shares'(8)	-	-	-	-	-	-	-	-	4	4	-	4
New capital from shares issued(9)	3,920	-	-	-	-	-	-	-	-	3,920	-	3,920
Non-controlling interest recognised on
acquisition of controlled entities	-	-	-	-	-	-	-	-	-	-	10	10
Balance at the end of theperiod	8,870	1,019	20	(7)	48	(54)	2	(3,585)	453	6,766	53	6,819
30 June 2010
Balance at the beginning of the period	4,814	1,019	1	(19)	67	(48)	2	(3,585)	320	2,571	63	2,634
Profit	-	-	-	-	-	-	-	-	425	425	(13)	412
Other comprehensive income	-	-	-	2	1	10	(5)	-	(27)	(19)		(19)
Total comprehensive income	-	-	-	2	1	10	(5)	-	398	406	(13)	393
Share based payment expense	-	-	10	-	-	-	-	-	-	10	-	10
Share purchases	-	-	(10)	-	-	-	-	-	-	(10)	-	(10)
Net sale/(purchase) of 'treasury shares'	2	-	-	-	-	-	-	-	4	6	-	6
Dividends paid(8)	-	-	-	-	-	-	-	-	(328)	(328)	-	(328)
Dividends paid on 'treasury shares'(8)		-	-	-	-	-	-	-	4	4	-	4
New capital from shares issued(9)	139	-	-	-	-	-	-	-	-	139	-	139
Non-controlling interest on sales and
acquisitions	-	-	-	-	-	-	-	-	-	-	1	1
Balance at the end of theperiod	4,955	1,019	1	(17)	68	(38)	(3)	(3,585)	398	2,798	51	2,849

AMP Limited Half Year Financial Report

Statement of changes in equity (continued) for the half year ended 30 June 2011

Footnote:

(1) The Equity contribution reserve was established in 2003 to recognise the additional loss on the demerger of AMP’s UK operations in December 2003. This loss was the difference between: the pro-forma loss on demerger based upon directors' valuation of the UK operations and the estimated net assets to be demerged, and the market based fair value of the UK operations based upon the share price of the restructured UK operations on listing and the actual net assets of the UK operations on demerger.
(2) The Share based payment reserve represents the cumulative expense recognised in relation to equity settled share based payments less the cost of shares purchased and transferred to share based payments recipients upon vesting.
(3) The Cash flow hedge reserve represents the cumulative impact of changes in the fair value of derivatives designated as cash flow hedges which are effective for hedge accounting. Hedge gains and losses are transferred to the Income statement when they are deemed ineffective or upon realisation of the cash flow.
(4) The Owner-occupied property revaluation reserve represents cumulative valuation gains and losses on owner-occupied property required to be recognised in equity.
(5) Exchange differences arising on translation of foreign controlled entities within the AMP group are recognised in Foreign currency translation reserve. Exchange gains and losses are transferred to the Income statement upon realisation of the investment in the foreign controlled entity.
(6) The Hedge of net investment reserve reflects gains and losses on effective hedges of net investments in foreign operations. Hedge gains and losses are transferred to the Income statement when they are deemed ineffective or upon realisation of the investment in the foreign controlled entity.
(7) The Demerger loss reserve represents the transfer from Shareholders' retained earnings of the total loss on demerger.
(8) Dividends paid includes the dividends paid on 'treasury shares'. Dividends paid on 'treasury shares' are required to be excluded from the consolidated financial statements by adjusting retained earnings.
(9) Shares issued under dividend reinvestment plan $118m (2010: $139m). Shares issued for acquisition of AXA Asia Pacific Holdings Limited $3,802m.

AMP Limited Half Year Financial Report

Statement of cash flows

for the half year ended 30 June 2011

	Consolidated	Consolidated
	30 Jun	30 Jun
	2011	2010
	$m	$m
Cash flows from operating activities
Cash receipts in the course of operations	7,510	5,973
Interest and other items of a similar nature received	1,211	1,008
Dividends and distributions received	1,078	746
Cash payments in the course of operations	(7,640)	(5,994)
Finance costs	(451)	(358)
Income taxpaid	(214)	(73)
Cash flows from operating activities	1,494	1,302
Cash flows from investing activities
Net proceeds from sale of/(payments to acquire)(1):
- investment property	20	2
- investments in financial assets	(2,634)	681
Acquisition of AXA Asia Pacific Holdings Limited(2)	441	-
Payments to acquire other subsidiaries and other businesses net of cash acquired(3)	-	(4)
Cash flows from(used in) investing activities	(2,173)	679
Cash flows from financing activities
Proceeds from borrowings - non Banking operations	505	679
Net movement in deposits from customers	508	147
Repayment of borrowings - non Banking operations	(856)	(818)
Net movement in borrowings - Banking operations	167	(206)
Proceeds from issue of subordinated debt	600	-
Dividendspaid(4)	(192)	(185)
Cash flows from(used in) financing activities	732	(383)
Net increase (decrease) in cash and cash equivalents	53	1,598
Cash and cash equivalents at the beginning of the period	8,168	6,631
Effect of exchange rate changes on cash and cash equivalents	9	4
Cash and cash equivalents at the end of theperiod	8,230	8,233

Footnote:

(1) Net cash flows from investing activities mainly comprise purchases and sales of investment property and financial assets held by the life entities' statutory funds and controlled entities of the life entities' statutory funds. The net payments to acquire investments in financial assets (2010: net proceeds from the sale) largely reflects policyholder investment decisions during the period.

(2) The net cash flows from the acquisition of AXA Asia Pacific Holdings Limited comprise $949m cash held by AXA Asia Pacific Holdings Limited group at acquisition date less cash consideration paid of $508m. The cash consideration paid consists of $455m for AMP's share of the cash paid to minority shareholders, $69m paid to rights holders less $16m adjustment payments received from AXA SA prior to reporting date. A further $1,970m of cash consideration paid to minority shareholders was funded by AXA SA. See Note 17 for further details.

(3) Payments to acquire other subsidiaries and other businesses did not have a material impact on the composition of the AMP group.

(4) The dividends paid amount is presented net of dividend reinvestment plan and dividends on 'treasury shares'. See Statement of changes in equity for further information.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

1. BASIS OF PREPARATION AND ACCOUNTING POLICIES

The consolidated economic entity (the AMP group) comprises AMP Limited (the parent entity), a company limited by shares, and incorporated and domiciled in Australia, and all entities that it controlled during the period and at the reporting date.

(a) Basis of preparation

These general purpose financial statements have been prepared in accordance with the Corporations Act 2001 and AASB134 ‘ Interim Financial Reporting ’.

These half year financial statements do not include all notes of the type normally included within the annual financial statements and therefore cannot be expected to provide as full an understanding of the financial position and financial performance of the AMP group as that given by the annual financial statements. As a result, these statements should be read in conjunction with the 2010 annual financial statements of the AMP group and any public announcements made in the period by the AMP group in accordance with the continuous disclosure requirements of the Corporations Act 2001 and the ASX Listing Rules.

The principal accounting policies and methods of computation adopted in the preparation of the 2011 half year financial statements are consistent with the accounting policies and methods of computation adopted in the preparation of the 2010 annual financial statements with the exception of the application of new standards as set out below.

The AMP group is predominantly a wealth-management business with much of the business of the group being through two registered life insurance companies (the AMP life insurance entities).

Assets and liabilities have been presented on the face of the Statement of financial position in decreasing order of liquidity and do not distinguish between current and non-current items. The majority of the assets of the AMP group are investment assets held to back investment contract and life insurance contract liabilities.

Significant judgements, estimates and assumptions

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Assumptions made at each reporting date (for example, the calculation of life insurance contracts liabilities, fair value measurements, provisions and impairment testing of intangibles) are based on best estimates at that date. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including reasonable expectations of future events.

Changes in accounting policy

Since 1 January 2011, the AMP group has adopted a number of Australian Accounting Standards and Interpretations which are mandatory for annual periods beginning on or after 1 January 2011. Adoption of these Standards and Interpretations has not had any material effect on the financial position or performance of the AMP group.

Australian Accounting Standards issued but not yet effective/Early adoption of Australian Accounting Standards

A number of new accounting standards have been issued but are not yet effective during 2011. The AMP group has not elected to early adopt any of these new standards or amendments in these half year financial statements.

Change in presentation in the Statement of financial position

The statement of financial position has been enhanced to show on a gross basis the collateral held by the life entities’ statutory funds and their controlled entities in relation to debt security repurchase arrangements and the liability to return this collateral on settlement.

As in prior periods, securities subject to repurchase agreements are not derecognised from the Statement of financial position as the risk and rewards of ownership remain within the investment portfolio. However, collateral received from the counterparty and the liability to return this collateral is now presented on a gross basis in the Statement of financial position.

This change has resulted in the following changes to the amounts presented in the financial statements:

an increase in Cash and cash equivalents in the Statement of financial position of $196m (2010: $167m);
an increase in Investments in Financial assets measured at fair value through profit or loss in the Statement of financial position of $2,234m (2010; $2,177m);
an increase in Other financial liabilities in the Statement of financial position of $2,430m (2010: $2,344m).;
a decrease in the net payments to acquire investments in financial assets in the Statement of cash flows of $86m (2010: $298m increase in net proceeds from sale of investments in financial assets);
an increase in Cash and cash equivalents at the beginning of the period in the Statement of cash flows of $2,344m (2010: $1,519m)
an increase in Cash and cash equivalents at the end of the period in the Statement of cash flows of $2,430m (2010: $1,817m)

There is no change to reported net assets, profit or earnings per share. Comparatives have been restated to be consistent with current year disclosures.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

1. BASIS OF PREPARATION AND ACCOUNTING POLICIES (CONTINUED)

(b) Principles of consolidation

The financial statements consolidate the financial information of controlled entities. Control is determined as the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.

The financial information for controlled entities is prepared for the same reporting date as the parent entity, using consistent accounting policies. Where dissimilar accounting policies may exist, adjustments are made to bring these into line.

The AMP life insurance entities conduct wealth-management business through separate life entities’ statutory funds. Income, expenses, assets and liabilities attributable to policyholders within the life entities’ statutory funds are consolidated into the AMP group financial statements, along with those attributable to the shareholders of the parent entity.

The life entities’ statutory funds include controlling interests in unit trusts and companies. The total amounts of each underlying asset, liability, income and expense of the controlled entities are recognised in the consolidated financial statements.

When a controlled unit trust is consolidated, the share of the unitholder liability attributable to the AMP group is eliminated but amounts due to external unitholders remain as liabilities in the consolidated Statement of financial position.

The share of the net assets of controlled companies attributable to non-controlling interests is disclosed separately on the Statement of financial position. In the Income statement, the profit or loss of the AMP group is allocated between profit or loss attributable to noncontrolling interests and profit or loss attributable to the parent entity.

Controlled entities acquired are accounted for using the acquisition method of accounting. Information from the financial statements of controlled entities is included from the date the parent entity obtains control until such time as control ceases. Where the AMP group ceases to control an entity, the consolidated financial statements includes the results for the part of the reporting date during which the parent entity had control. All inter-company balances and transactions are eliminated in full, including unrealised profits arising from intragroup transactions.

During the period, AMP group acquired AXA Asia Pacific Holdings Limited. Information in relation to this transaction is set out in Note 17.

In the course of normal operating investment activities, the life entities’ statutory funds acquire equity interests in entities which, in some cases, result in AMP holding a controlling interest in the investee entity. Most such acquisitions and disposals of controlled entities are in relation to unit trusts with underlying net assets typically comprising investment assets and cash. The consideration for acquisitions or disposals reflects the fair value of the investment assets at the date of the transactions after taking into account non-controlling interests.

Certain controlled entities of the life entities’ statutory funds are operating companies which carry out business operations unrelated to the core wealth management operations of the AMP group.

Securitisation vehicles

The banking operation of the AMP group sells mortgage loans to securitisation vehicles (also referred to as special purpose entities) through its loan securitisation program. These securitisation vehicles are controlled by the AMP group and are therefore consolidated.

(c) Accounting mismatches

Under Australian Accounting Standards, accounting mismatches arise from some of the life entities’ statutory funds’ transactions because the recognition and measurement rules for certain policyholder assets differ from the recognition and measurement rules for the liability to policyholders in respect of the same assets. These mismatches result in policyholder asset movements impacting the profit attributable to shareholders and increases volatility of the reported profit. Accounting mismatches primarily arise in respect of gains and losses on:

treasury shares
investments in controlled entities of the life entities’ statutory funds
owner-occupied property
life entities’ statutory funds’ superannuation products invested in AMP Bank assets

Treasury shares

The Australian Securities and Investments Commission (ASIC) has granted relief from restrictions in the Corporations Act 2001 to allow AMP’s life insurance entities to hold and trade shares in AMP Limited as part of the policyholder funds' investment activities. These shares (defined by Australian Accounting Standards as treasury shares ) are held on behalf of policyholders and, as a result, the life entities’ statutory funds also recognise a corresponding liability to policyholders.

Under Australian Accounting Standards, the AMP group cannot recognise ‘treasury shares’ in the consolidated Statement of financial position. These assets, plus any corresponding Income statement fair value movement on the assets and dividend income, are eliminated when the life entities’ statutory funds are consolidated into the AMP group. The cost of the investment in the shares is deducted from contributed equity.

However, the corresponding investment contract and life insurance contract liabilities, and related Income statement change in the liabilities, remain on consolidation. At the AMP group consolidated level, this mismatch results in policyholder assets movements impacting the profit attributable to shareholders of AMP Limited.

Investments in controlled entities of the life entities’ statutory funds

The majority of the life entities’ statutory funds’ investments are held through controlling interests in a number of separate entities and these investments are measured at fair value. These investment assets are held on behalf of policyholders and, as a result, the life entities’ statutory funds also recognise a corresponding liability to the policyholder.

Consolidation principles require the underlying net assets of the controlled entities to be recognised in the consolidated financial statements. The value of the underlying assets recognised will not necessarily be the same value as the life entities’ statutory funds’ value of those investments in the controlled entities.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

1. BASIS OF PREPARATION AND ACCOUNTING POLICIES (CONTINUED)

However, the corresponding investment contract and life insurance contract liabilities, and related Income statement change in the liabilities, remain upon consolidation. At the AMP group consolidated level, this mismatch results in policyholder assets movements impacting the profit attributable to shareholders of AMP Limited.

Owner-occupied property

Under Australian Accounting Standards, property owned by the AMP group which is also occupied by the AMP group is considered property, plant and equipment in the consolidated Statement of financial position. Upward revaluations of owner-occupied property are recognised in equity. Downward revaluations are recognised in the Income statement to the extent that they exceed previous upward revaluations of the same property.

However, to the extent any such property is held by the life entities’ statutory funds, investment contract and life insurance contract liabilities are required to reflect owner-occupied property at fair value, with movements in those liabilities recognised in the Income statement. At the AMP group consolidated level, this mismatch results in policyholder assets movements impacting the profit attributable to shareholders of AMP Limited.

Life entities’ statutory funds’ superannuation products invested in AMP Bank assets

AMP Bank assets are measured at amortised cost using the effective interest rate method.

However, to the extent any such assets are funded by policyholder investments through life entities’ statutory funds, Australian Accounting Standards require these investments to be measured at fair value within investment contract and life insurance contract liabilities, with movements recognised in the Income statement. At the AMP group consolidated level, this mismatch results in policyholder assets movements impacting the profit attributable to shareholders of AMP Limited.

(d) Cash and cash equivalents

Cash and cash equivalents comprise cash on hand that is available on demand and deposits that are held at call with financial institutions. Cash and cash equivalents are measured at fair value, being the principal amount. For the purpose of the Statement of cash flows, cash also includes other highly liquid investments not subject to significant risk of change in value, with short periods to maturity, net of outstanding bank overdrafts. Bank overdrafts are shown within Borrowings in the Statement of financial position.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

2. SEGMENT INFORMATION

(a) Segments - background

Operating segments have been identified based on separate financial information that is regularly reviewed by the Chief operating decision maker (CODM). The term CODM refers to the function performed by the Chief Executive Officer and his immediate team, as a team, in assessing performance and determining the allocation of resources. The operating segments are identified according to the nature of profit generated and services provided. Segment information in this Note is reported separately for each operating segment. AMP group evaluates the performance of segments on a post tax operating earnings basis.

Segment information is not reported for activities of AMP group office companies as the function of these departments is not to earn revenue and revenues earned are only incidental to the activities of the AMP group.

Asset segment information has not been disclosed because the balances are not provided to the CODM for the purposes of evaluating segment performance and deciding the allocation of resources to segments.

(b) Description of segments

Australian Contemporary Wealth Management (CWM) – financial planning services, unit linked superannuation, retirement income and managed investment products business including financial planning and advice services and banking operations.

Australian Contemporary Wealth Protection (CWP) – includes personal and group term, disability and income protection insurance products which can be either bundled with a superannuation product or held independently of a superannuation contract.

Australian Mature – a business comprising primarily closed products which are in run-off. Closed products include whole of life, endowment, investment linked, investment account, retirement savings accounts and annuities.

AMP Financial Services New Zealand (AFS NZ) – a risk insurance business and mature book with a growing KiwiSaver, unit-linked superannuation and investment business.

AXA - In March 2011, AMP merged with AXA Asia Pacific Holdings Limited’s Australian and New Zealand businesses (AXA). AXA provides a range of products and services to customers in Australia and New Zealand. These products are primarily distributed through self-employed financial planners and advisers aligned with AXA. AXA will be incorporated into AMP’s other segments for December 2011 reporting.

AMP Capital Investors (AMPCI) – manages investments across all the major asset classes including equities, fixed interest, infrastructure, property, diversified funds and multi-manager funds. AMPCI also provides commercial, industrial and retail property management services. It provides its investment management services through in-house investment professionals and carefully selected global network of investment partners. In addition to its well established reputation in Australia and New Zealand, AMPCI has a strong and growing international presence with offices in Bahrain, Beijing, London, Mumbai, New York, Singapore, and Tokyo allowing it to source both investment funds and competitive offshore opportunities.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

2. SEGMENT INFORMATION (CONTINUED)

(c) Segment profit

(c) Segment profit
								Total
				Australian				Operating
		CWM	CWP(2)	Mature(2)	AFS NZ(2)	AXA(2)	AMPCI(4)	Segments
30 June 2011		$m	$m	$m	$m	$m	$m	$m
Segment profit after
income tax (1)		157	84	67	21	59	41	429
Other segment information(5)
External customer revenue		543	84	67	21	213	118	1,046
Intersegment revenue(6)		44	-	-	-	-	80	124
Income tax expense		67	36	29	7	20	13	172
Depreciation and
amortisation		16	2	-	1	-	4	23
30 June 2010
Segment profit after
income tax(1)		150	73	68	32	-	44	367
Other segment information	(5)
External customer revenue		526	73	68	32	-	88	787
Intersegment revenue(6)		42	-	-	-	-	88	130
Income tax expense		64	31	29	14	-	15	153
Depreciation and
amortisation		14	3	-	1	-	3	21

(1) Segment profit after income tax differs from Profit attributable to shareholders of AMP Limited due to the exclusion of the following items:

i) Group office costs.

ii) Investment return on shareholder assets invested in income producing investment assets.

iii) Interest expense on AMP corporate debt.

iv) The effects of non-recurring items such as: merger and acquisition transaction costs, AXA integration costs, recognition of prior year tax deductions and other one-off and non-recurring costs. These items do not reflect the underlying operating performance of the operating segments.

v) Accounting mismatches, market adjustments - annuity fair value and risk products and amortisation of AXA acquired intangible assets.

(2) Statutory reporting revenue for Australian Contemporary Wealth Protection, Australian Mature, AMP Financial Services NZ and AXA businesses includes premium and investment gains and losses. However, for segment reporting, external customer revenue is operating earnings which represents gross revenue less claims, expenses, movement in insurance contract liabilities and tax relating to those segments.

(3) AXA segment is for the period from the date of acquisition by AMP to 30 June 2011.
(4) AMP Capital Investors segment revenue is reported net of external investment manager fees paid in respect of certain assets under management. AMP Capital Investors segment profit after income tax excludes Seed Pool valuation adjustments.

(5) Other segment information excludes revenue, expenses and tax relating to assets backing policyholder liabilities.

(6) Intersegment revenue represents operating revenue between segments priced on an arm’s length basis.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

2. SEGMENT INFORMATION (CONTINUED)

	30 Jun	30 Jun
	2011	2010
	$m	$m
(d) Reconciliation of segment profit after tax
Australian contemporary wealth management	157	150
Australian contemporary wealth protection	84	73
Australian mature	67	68
New Zealand	21	32
AMP Financial Services	329	323
AXA Australia and New Zealand	59	-
AMP Capital Investors	41	44
BU operating earnings	429	367
GroupOffice costs	(26)	(20)
Total operating earnings	403	347
Underlying investment income(1)	83	64
Interest expense on corporate debt	(39)	(36)
AMP Limited tax loss recognition	8	8
Underlying Profit	455	383
Market adjustment - investment income(1)	(3)	(8)
Market adjustment - annuity fair value	16	5
Market adjustment - risk products	(1)	10
Loan hedge revaluations	-	8
Other items(2)	(17)	4
Profit after income tax before AXA merger related adjustments
and accounting mismatches	450	402
M&A transaction costs	(34)	(7)
AXA integration costs	(36)	-
Amortisation of AXA acquired intangible assets	(22)
Accountingmismatches	(9)	30
Netprofit attributable to shareholders of AMP Limited	349	425

(1) Underlying investment income consists of investment income on shareholder assets invested in income producing investment assets (as opposed to income producing operating assets) normalised in order to bring greater clarity to the results by eliminating the impact of short-term market volatility on underlying performance. Underlying performance is based on long-term expected returns for each asset class. Market adjustment - investment income is the excess (shortfall) between the underlying investment income and the actual return on shareholder assets invested in income producing investment assets.

(2) Other items principally comprise one-off and non-recurring costs. The current period includes restructuring, redundancy costs and a number of compliance costs (2010 - more than offset by the benefit from the retrospective impact of changes in tax legislation).

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

2. SEGMENT INFORMATION (CONTINUED)

	30 Jun	30 Jun
	2011	2010
	$m	$m
(e) Reconciliation of segment revenue
Total segment revenue	1,170	917
Add revenue excluded from segment revenue
Investment gains and (losses) - shareholders and policyholders (excluding AMP bank interest
revenue)	1,681	(886)
Revenue of investment entities controlled by the life statutory funds which carry out business operations
unrelated to the core wealth management operations of the AMP group	112	138
Other revenue	35	8
Add back expenses netted against segment revenue
Claims, expenses, movement in insurance contract liabilities and tax relating to Australian
Contemporary Wealth Protection, Australian Mature, AFS NZ businesses and AXA Australia and
New Zealand businesses	581	357
Interest expense related to AMP Bank	323	343
External investment manager fees paid in respect of certain assets under management	147	153
Remove intersegment revenue	(124)	(130)
Total revenue (1)	3,925	900

(1) Revenue as per the Income statement of $3,925m (2010: $900m) comprises Premiums and related revenue $798m (2010:

$530m), Fee revenue $893m (2010: $702m), Other revenue $147m (2010: $146m) and Investment gains and (losses) $2,087m gain (2010: losses of $478m).

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

3. INCOME

	Consolidated	Consolidated
	30 Jun	30 Jun
	2011	2010
	$m	$m
(a) Life insurance premium and related revenue
Life insurance contract premium revenue	761	511
Reinsurance recoveries	37	19
Total life insurancepremium and related revenue	798	530
(b) Fee revenue
Investment management and origination fees	717	614
Financial advisory fees	170	80
Bankingbusiness fees	6	8
Total fee revenue (1)	893	702
(c) Other revenue
Defined benefit plan income	1	1
Other revenue (2)	146	145
Total other revenue	147	146

Footnote:

(1) Total fee revenues of AMP group include fee income from trust and fiduciary activities that result in the holding or investing of assets on behalf of individuals, trusts, retirement benefit plans, and other institutions, with the exception of $6m (2010: $8m) fees from banking operations, which are fees from financial assets that are not measured at fair value through profit or loss.

(2) Other revenue includes trading revenue of investment entities controlled by the life entities' statutory funds which carry out business operations unrelated to the core wealth management operations of the AMP group.

AMP Limited Half Year Financial Report Notes to the financial statements

for the half year ended 30 June 2011

4. INVESTMENT GAINS AND (LOSSES)

	Consolidated	Consolidated
	30 Jun	30 Jun
	2011	2010
	$m	$m
Investment gains and (losses)
Interest(1)	1,226	1,006
Dividends and distributions
- associated entities not equity accounted	90	15
- other entities	1,242	916
Rental income	335	367
Net realised and unrealised gains and (losses)(2)	(825)	(2,805)
Other investment income	19	23
Total investmentgains and(losses)	2,087	(478)

Footnote:

(1) Interest includes interest income from financial assets designated at fair value through profit or loss upon initial recognition, with the exception of $390m (2010: $338m) interest income from held to maturity investments and loans and receivables in banking operations, which are measured at amortised cost.

(2) Net realised and unrealised gains and losses include net gains and losses on financial assets and financial liabilities designated at fair value through profit or loss upon initial recognition.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

5. EXPENSES

	Consolidated	Consolidated
	30 Jun	30 Jun
	2011	2010
	$m	$m
(a) Life insurance claims and related expenses
Life insurance contract claims and related expenses	(730)	(625)
Outwards reinsurance expense	(32)	(22)
Total life insurance claims and related expenses	(762)	(647)
(b) Operating expenses
Commission and advisory fee-for-service expense	(392)	(258)
Investment management expenses	(116)	(98)
Fee expense on bankingbusiness	(6)	(6)
Fee and commission expenses(1)	(514)	(362)
Wages and salaries	(376)	(273)
Contributions to defined contribution plans	(29)	(27)
Defined benefit fund expense	(1)	-
Share based payments expense	(13)	(10)
Other staff costs	(55)	(20)
Staff and related expenses	(474)	(330)
Occupancy and other property related expenses	(43)	(41)
Direct property expenses(2)	(86)	(95)
Information technology and communication	(86)	(59)
Professional fees	(77)	(39)
Advertising and marketing	(19)	(21)
Travel and entertainment	(14)	(12)
Impairment of intangibles	(6)	-
Amortisation of intangibles	(63)	(61)
Depreciation of property, plant and equipment	(16)	(23)
Other expenses(3)	(94)	(56)
Other operating expenses	(504)	(407)

Total operating expenses	(1,492)	(1,099)
(c) Finance costs
Interest expense on borrowings and subordinated debt	(392)	(340)
Other finance costs	(52)	(64)
Total finance costs	(444)	(404)

Footnote:

(1) Fee and commission expenses include (a) Fee expenses from trust and other fiduciary activities that result in the holding or investing of assets on behalf of individuals, trusts, retirement benefit plans, and other institutions (b) $6m (2010: $6m) fee expense on banking business, which are fees from financial liabilities that are not measured at fair value through profit or loss.

(2) Direct property expenses relate to investment properties which generate rental income.

(3) Other expenses include trading expenses of investment entities controlled by the life statutory funds which carry out business operations unrelated to the core wealth management operations of the AMP group.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

6. INCOME TAX

6. INCOME TAX
	Consolidated
	30 Jun	30 Jun
	2011	2010
	$m	$m
(a) Analysis of income tax (expense) credit
Current tax	(337)	(198)
Increase (decrease) in deferred tax assets	216	136
(Increase) decrease in deferred tax liabilities	112	227
Over (under) provided in previous years including amounts attributable to policyholders	3	34
Effect ofchangeinoverseas tax rate	-	6
Income tax (expense) credit	(6)	205

(b) Relationship between income tax expense and accounting profit

The following table provides a reconciliation of differences between prima facie tax calculated as 30% of the profit before income tax for the period and the actual income tax expense recognised in the Income statement for the period. The income tax expense amount reflects the impact of both income tax attributable to shareholders as well as income tax attributable to policyholders.

In respect of income tax expense attributable to shareholders, the tax rate which applies in Australia is 30%. There are certain differences between the amounts of income and expenses recognised in the financial statements and the amounts recognised for income tax purposes. The New Zealand government company tax rate decreased from 30% to 28% from 1 January 2011 which gives rise to an adjustment for differences in overseas tax rates.

Income tax attributable to policyholders is based on investment income allocated to policyholders less expenses deductible against that investment income. The impact of the tax is charged against policyholder liabilities. A number of different tax rate regimes apply to policyholders. In Australia, certain classes of policyholder life insurance income and superannuation earnings are taxed at 15%, and certain classes of income on some annuity business are tax-exempt. The rate applicable to New Zealand life insurance business during the period was 28% (2010: 30%).

the period was 28% (2010: 30%).
	Consolidated
	30 Jun	30 Jun
	2011	2010
	$m	$m
Profit before income tax	338	207
Policyholder tax credit (expense) recognised as part of the change in policyholder liabilities in
determining profit before tax	124	293
Profit before income tax excluding tax charged topolicyholders	462	500
Prima facie tax at the rate of 30%	(139)	(150)
Tax effect of differences between amounts of income and expenses recognised for accounting and the
amounts deductible/taxable in calculating taxable income:
Shareholder impact of par-business tax treatment	10	16
Non-deductible expenses	(27)	(14)
Non-taxable income	2	9
Tax offsets and credits	16	9
Shareholder impact of change in New Zealand life insurance tax regime	-	(10)
Other items	1	(1)
Over (under) provided in previous years after excluding amounts attributable to policyholders(1)	2	39
Benefit arising from previously unrecognised tax losses	3	8
Differences in overseas tax rate	2	-
Effect of change in overseas tax rates	-	6
Income tax (expense) credit attributable to shareholders	(130)	(88)
Income tax(expense)credit attributable topolicyholders	124	293
Income tax(expense) creditper Income statement	(6) ~~e o~~	205

Footnote:

(1) The over provision by AMP group recognised in 2010 is principally in relation to the retrospective effect of changes in taxation legislation enacted in 2010.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

6. INCOME TAX (CONTINUED)

	Consolidated	Consolidated
	30 Jun	31 Dec
	2011	2010
	$m	$m
(c) Analysis of deferred tax assets
Expenses deductible and income recognisable in future years	336	106
Unrealised movements on borrowings and derivatives	69	44
Unrealised investment losses	159	65
Losses available for offset against future taxable income	634	331
Other	36	36
Total deferred tax assets	1,234	582
(d) Analysis of deferred tax liabilities
Unrealised investment gains	292	414
Unrealised movements on borrowings and derivatives	103	46
Other	383	160
Total deferred tax liabilities	778	620

AMP Limited Half Year Financial Report Notes to the financial statements

for the half year ended 30 June 2011

7. INVESTMENTS IN FINANCIAL ASSETS AND OTHER FINANCIAL LIABILITIES

	Consolidated	Consolidated
	30 Jun	31 Dec
	2011	2010
	$m	$m
Investments in financial assets measured at fair value through profit or loss(1)
Equity securities and listed managed investment schemes	37,154	32,130
Debt securities (2)	29,102	22,808
Investments in unlisted managed investment schemes	11,751	9,921
Derivative financial assets	1,561	1,873
Other financial assets(3)	149	242
Total investments in financial assets measured at fair value through profit or loss	79,717	66,974
Investments in financial assets measured at amortised cost
Loans and advances	11,050	10,202
Debt securities - held to maturity	1,028	733
Total investments in financial assets measured at amortised cost	12,078	10,935
Other financial liabilities
Derivative financial liabilities	715	718
Collateral deposits held (4)	2,430	2,344
Total other financial liabilities	3,145	3,062

Footnote

(1) Investments measured at fair value through profit or loss are mainly assets of the life entities' statutory funds and controlled entities of the life entities' statutory funds.

(2) Included within debt securities are assets held to back the liability for collateral deposits held in respect of debt security repurchase arrangements entered into by the life entities' statutory funds and the controlled entities of the life entities' statutory funds.

(3) Other financial assets include investments of the life entities' statutory funds and controlled entities of the life entities' statutory funds.

(4) Collateral deposits held represents the obligation to repay collateral held in respect of debt security repurchase arrangements entered into by the life entities' statutory funds and the controlled entities of the life entities' statutory funds.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

8. INVESTMENT PROPERTY

	Consolidated	Consolidated
	30 Jun	31 Dec
	2011	2010
	$m	$m
Investment property(1)
Directlyheld	7,253	7,122
Total investmentproperty	7,253	7,122
Movements in investment property for the half year ended 30 June 2011 (2010 - for the
full year ended 31 December 2010)
Balance at the beginning of the period	7,122	7,832
Additions
- subsequent expenditure recognised in carrying amount	31	123
Acquisitions (disposal) through business combinations(2)	11	(835)
Disposals	(20)	(197)
Net gains (losses) from fair value adjustments	93	290
Foreign currency exchange differences	3	(12)
Transfer from inventories	13	4
Transfer(to)inventories	-	(83)
Balance at the end of theperiod	7,253	7,122

Footnote:

(1) Investment property includes properties of the life entities' statutory funds and investment entities controlled by the life entities' statutory funds of $7,242m (2010: $7,122m).

(2) Additions (disposals) through business combinations relate to the assets included on acquisition of AXA APH (2010: mainly to transactions of investment entities in which the life entities' statutory funds hold a controlling equity interest).

Valuation of investment property

Investment property is measured at fair value at each reporting date. Fair value represents the amount at which the assets could be exchanged between a knowledgeable willing buyer and a knowledgeable willing seller in an arm’s length transaction.

Fair values of the AMP group’s properties are determined by independent registered valuers who have appropriate registered professional qualifications and recent experience in the location and category of the property being valued.

The fair value appraisals are obtained at least on a rolling annual basis. The valuation schedule may be altered when a property is either undergoing or being appraised for redevelopment, refurbishment or sale, or is experiencing other changes in assets or tenant profiles which may significantly impact value or when there have been significant changes in the property market and broader economy such as updates to comparable property sales which may have an impact on the individual asset values. The carrying value of each investment property is assessed at reporting date to ensure there has been no material change to the fair value since the valuation date.

The valuers apply ‘comparable sales analysis’ and the ‘capitalised income approach’ by reference to annual net market income, comparable capitalisation rates and other property-specific adjustments as well as discounted cash flow analysis where the expected net cash flows are discounted to their present value using a market determined risk adjusted discount rate. The fair value of investment property does not reflect future capital expenditure that will improve or enhance the property.

	Consolidated	Consolidated
	30 Jun	31 Dec
	2011	2010
	$m	$m
Primary assumptions used in valuing investmentproperty
Capitalisation rates	6.125% - 9.75%	6.25% - 9.75%
Market determined,risk adjusted discount rate	7%- 10.75%	7%- 10.35%

AMP Limited Half Year Financial Report Notes to the financial statements

for the half year ended 30 June 2011

9. PROPERTY, PLANT AND EQUIPMENT

	Owner-
	occupied	Leasehold	Plant &
Consolidated	property(1)	improvements	equipment(2)	Total
30 June 2011	$m	$m	$m	$m
Property, plant and equipment
Gross carrying amount	281	71	336	688
Less: accumulated depreciation and impairment losses	-	(58)	(161)	(219)
Property, plant and equipment at written down value	281	13	175	469
Movements in property, plant and equipment for the half
year ended 30 June 2011
Balance at the beginning of the period	301	15	136	452
Additions
- through direct acquisitions	-	-	20	20
- subsequent expenditure recognised in carrying amount	1	-	-	1
Acquisitions through business combinations	-	-	31	31
Increases(decreases) from revaluations recognised directly in
equity	(19)	-	-	(19)
Depreciation expense for theperiod	(2)	(2)	(12)	(16)
Balance at the end of theperiod	281	13	175	469
	Owner-
	occupied	Leasehold	Plant &
	property (1)	improvements	equipment (2)	Total
31 December 2010	$m	$m	$m	$m
Property, plant and equipment
Gross carrying amount	301	72	300	673
Less: accumulated depreciation and impairment losses	-	(57)	(164)	(221)
Property, plant and equipment at written down value	301	15	136	452
Movements in property, plant and equipment for the full
year ended 31 December 2010
Balance at the beginning of the period	301	20	154	475
Additions
- through direct acquisitions	-	-	18	18
- subsequent expenditure recognised in carrying amount	4	1	-	5
Disposals	-	-	(3)	(3)
Increases(decreases) from revaluations recognised directly in
equity	(1)	-	-	(1)
Depreciation expense for the period	(3)	(6)	(32)	(41)
Foreign currencyexchange differences	-	-	(1)	(1)
Balance at the end of theperiod	301	15	136	452

Footnote:

(1) Owner-occupied property is measured at fair value; had the asset been measured at historic cost the amortised carrying value would have been $198m (2010: $199m).

(2) Plant and equipment includes operating assets of investment entities controlled by the life statutory funds which carry out business operations unrelated to the core wealth management operations of the AMP group.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

10. INTANGIBLES

			Manag-	Value of	Distrib
Consolidated	Goodwill	Capital-	ement	in-force	-ution	Other
	(1)(2)	ised costs	rights	business	networks	intangibles	Total
30 June 2011	$m	$m	$m	$m	$m	$m	$m
Intangibles
Gross carrying amount	2,555	535	22	1,256	138	106	4,612
Less: accumulated amortisation and / or
impairment losses	(82)	(373)	(2)	(26)	(3)	(37)	(523)
Intangibles at written down value	2,473	162	20	1,230	135	69	4,089
Movements in intangibles for the half
year ended 30 June 2011
Balance at the beginning of the period	702	162	20	-	-	35	919
Additions (reductions) through acquisitions
(disposal) of controlled entities(2)	1,777	-	-	1,256	134	40	3,207
Additions through separate acquisition	-	-	-	-	4	-	4
Additions through internal development	-	26	-	-	-	-	26
Amortisation expense for the period (3)	-	(25)	-	(26)	(3)	(9)	(63)
Impairment losses (recognised) or reversed
in profit(4)	(6)	-	-	-	-	-	(6)
Other movements	-	(1)	-	-	-	3	2
Balance at the end of theperiod	2,473	162	20	1,230	135	69	4,089
31 December 2010	$m	$m	$m	$m	$m	$m	$m
Intangibles
Gross carrying amount	777	512	22	-	-	66	1,377
Less: accumulated amortisation and / or
impairment losses	(75)	(350)	(2)	-	-	(31)	(458)
Intangibles at written down value	702	162	20	-	-	35	919
Movements in intangibles for the full
year ended 31 December 2010
Balance at the beginning of the period	730	159	20	-	-	37	946
Additions (reductions) through acquisitions
(disposal) of controlled entities and other
businesses	(9)	-	-	-	-	-	(9)
Additions through separate acquisition	-	-	-	-	-	3	3
Additions through internal development	-	64	-	-	-	-	64
Amortisation expense for the period(3)	-	(51)	-	-	-	(10)	(61)
Impairment losses (recognised) or reversed
in profit (4)	(19)	-	-	-	-	-	(19)
Foreign currency exchange differences	-	-	(1)	-	-	-	(1)
Other movements	-	(10)	1	-	-	5	(4)
Balance at the end of theperiod	702	162	20	-	-	35	919

Footnote:

(1) Total goodwill comprises amounts attributable to shareholders of $2,294m (2010: $517m) and attributable to policyholders of $179m (2010: $185m).

(2) Additions arose from the purchase of AXA Asia Pacific Holdings Limited (refer to Note 17). Disposal of goodwill during 2010 relates to the sale of an operating business of controlled entities of the life entities' statutory funds.

(3) Amortisation expense for the period is included in Operating expenses in the Income statement.

(4) Impairment of goodwill relates to goodwill of controlled entities of the life entities' statutory funds, which carry out business operations unrelated to the core wealth management operations of the AMP group.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

11. BORROWINGS

	Consolidated	Consolidated
	30 Jun	31 Dec
	2011	2010
	$m	$m
Bank overdrafts	2	-
Bank loans	766	962
Bonds and notes	6,708	6,687
Deposits (1)	3,555	3,082
Other borrowings	61	60
Total borrowings(2)	11,092	10,791

Footnote:

(1) Deposits mainly comprise at call retail cash on deposit and retail term deposits at variable interest rates within the AMP Bank.

(2) Total borrowings comprise amounts to fund:
i) Corporate and other shareholder activities of AMP group $614m (2010: $764m).
ii) AMP Bank and securitisation trusts borrowings $9,019m (2010: $8,369m).

iii) Statutory fund borrowings and borrowings within controlled entities of AMP Life $1,459m (2010: $1,658m).

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

12. SUBORDINATED DEBT

	Consolidated	Consolidated
	30 Jun	31 Dec
	2011	2010
	$m	$m
6.875% GBP Subordinated Guaranteed Bonds (maturity 2022)	59	56
Floating Rate Subordinated Unsecured Notes (first call date 2016, maturity 2021) (1)(2)	599	-
A$ AMP Notes (first call date 2014, maturity 2019) (3)	199	202
NZ$AMP Notes(first call date 2014,maturity2019)(3)	88	87
Total subordinated debt	945	345

Footnote:

(1) During the period, new subordinated debt of $600m was issued. The balance is less capitalised borrowing costs.

(2) In the event that AMP does not call the subordinated debt at the first call date the note holders have the right to exchange the notes for AMP shares at a small discount to volume weighted average price at that time.

(3) In the event that AMP does not call the subordinated debt at the first call date the note holders have the right to an interest margin 50% higher than that at issue.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

13. DIVIDENDS

	Consolidated	Consolidated
	30 Jun	30 June
	2011	2010
	$m	$m
Final dividends paid
2010 final dividend paid in 2011: 15 cents per ordinary share franked to 60%
(2009 final dividend paid in 2010: 16 cents per ordinary share franked to 50%)	314	328
Total dividendspaid(1) (2)	314	328
Interim dividends proposed but not recognised (2)
2011: 15 cents per ordinary share franked to 30%
(2010: 15 centsper ordinaryshare franked to 60%)	415	n/a

Footnote:

(1) Total dividends paid includes dividends paid on 'treasury shares'. See Statement of changes in equity for further information regarding the impact of 'treasury shares' on dividends paid and retained earnings.

(2) All dividends are franked at a tax rate of 30%.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

14. CONTRIBUTED EQUITY

	Consolidated	Consolidated
	30 Jun	31 Dec
	2011	2010
	$m	$m
Movements in issued capital
Balance at the beginning of the period	5,209	4,957
695,262,564 shares issued for acquisition of AXA Asia Pacific Holdings Limited(1)	3,802	-
22,007,149 (2010: 45,779,038) sharesissued underdividendreinvestment plan(2)	118	252
Balance at the end of theperiod	9,129	5,209
Total issued capital
2,811,693,913 (2010: 2,094,424,200) ordinary sharesfully paid	9,129	5,209
Movements in 'treasury shares' - half year ended 30 June 2011 (2010 - full year ended 31
December 2010)(3)(4)
Balance at the beginning of the period	(158)	(143)
1,947,967 (Increase) arising from acquisition of AXA Asia Pacific Holdings Limited	(11)	-
18,189,302(Increase)decrease due topurchases less sales duringtheperiod	(90)	(15)
Balance at the end of theperiod	(259)	(158)
Total treasury shares
46,512,719(2010: 26,375,450)treasuryshares	(259)	(158)
Total contributed equity
2,765,181,194(2010: 2,068,048,750)ordinaryshares fully paid(3)(4)	8,870	5,051

Holders of ordinary shares have the right to receive dividends as declared and, in the event of the winding up of the company, to participate in the proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up on shares held. Ordinary shares have no par value.

Footnote:

(1) Shares issued to minority shareholders of AXA Asia Pacific Holdings Limited for the acquisition of its business recognised at fair value of $3,803m less deduction for costs of issue $1m - refer to note 17 for further details.

(2) Under the terms of the Dividend Reinvestment Plan (DRP), shareholders may elect to have all or part of their dividend entitlements satisfied by the issue of new shares rather than being paid cash. Shares were issued under the DRP for the 2010 final dividend (paid in April 2011) at $5.34 per share, 2010 interim dividend (paid in October 2010) at $5.01 per share.

(3) Of the ordinary shares on issue by AMP Limited, AMP's life insurance entities hold 44,760,451 (2010: 26,375,450) shares on behalf of policyholders. ASIC has granted relief from restrictions in the Corporations Act 2001 to allow AMP's life insurance entities to hold and trade shares in AMP Limited as part of the policyholder funds' investment activities. The cost of the investment in these 'treasury shares' is reflected as a deduction from total contributed equity.

(4) Of the ordinary shares 1,752,268 are held by a controlled entity of AXA Asia Pacific Holdings Limited.

AMP Limited Half Year Financial Report Notes to the financial statements

for the half year ended 30 June 2011

15. CONTINGENT LIABILITIES

As at the date of this report there have been no material changes in contingent liabilities since those reported in the 2010 Annual Financial Report.

As set out in note 17, there were no material contingent liabilities recognised in relation to the merger with the AXA business.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

16. EVENTS OCCURRING AFTER REPORTING DATE

At the date of this report, the directors are not aware of any matter or circumstance that has arisen since the reporting date which has significantly affected or may significantly affect the operations of the consolidated entity, the results of its operations or its state of affairs, which is not already reflected in this report other than the following:

Subsequent to 30 June 2011, global financial and equity markets have exhibited increased volatility. The majority of financial assets recorded in the Statement of financial position are held by the statutory funds of the life entities. Movements in the valuations of these financial assets primarily impact AMP's liability to policyholders and external unitholders in controlled unit trusts such that only a portion of the changes in the valuations for these assets have a direct impact on the shareholders' profit after tax. At times when markets exhibit increased volatility, such as this, AMP dynamically manages its capital position. At the date of this report AMP continues to be strongly capitalised and exceeds regulatory capital requirements.
On 18 August 2011, AMP announced an interim dividend on ordinary shares of 15 cents per share.

AMP Limited Half Year Financial Report

Notes to the financial statements for the half year ended 30 June 2011

17. MERGER WITH THE AUSTRALIAN & NEW ZEALAND BUSINESSES OF AXA ASIA PACIFIC HOLDINGS LIMITED

On 30 March 2011, AMP Limited completed its acquisition of AXA Asia Pacific Holdings Limited for the purposes of merging the Australian and New Zealand operations of both entities. The merger was effected by AMP acquiring 100% of the issued shares in AXA Asia Pacific Holdings Limited though a contractual arrangement with its parent entity, AXA SA, and a scheme of arrangement with its minority shareholders. The contractual arrangement to acquire the shares held by AXA SA was conditional upon the approval of the scheme of arrangement with the minority shareholders of AXA Asia Pacific Holdings Limited which was approved by those shareholders on 2 March 2011 and subsequently approved by the Supreme Court of Victoria on 7 March 2011. AMP obtained control of AXA Asia Pacific Holdings Limited on 30 March 2011, which is the date that AMP acquired 100% of AXA Asia Pacific Holdings Limited shares and was able to appoint directors to the Board.

The principal activity of AXA Asia Pacific Holdings Limited is wealth management.

Details of the purchase consideration are set out below:

Details of the purchase consideration are set out below:
	$m
Cash consideration paid to minority shareholders of AXA Asia Pacific Holdings Limited	2,425
AMP Limited shares issued to minority shareholders of AXA Asia Pacific Holdings Limited(1)	3,803
Consideration paid to AXA SA	7,146
Payment to AXA Asia Pacific Holdings Limited rights holders	69
Total Purchase consideration	13,443

(1) 695,262,564 AMP Limited shares at $5.47 per share, being the last traded price on the ASX on 30 March 2011

The Asian subsidiaries of AXA Asia Pacific Holdings Limited and its ownership interests in joint ventures with AllianceBernstein LP were sold on 31 March 2011 and 1 April 2011 for $9,159m. There was no gain or loss recognised by AMP group on the sale of these businesses.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

17. MERGER WITH THE AUSTRALIAN & NEW ZEALAND BUSINESSES OF AXA ASIA PACIFIC

HOLDINGS LIMITED (CONTINUED)

Details of the provisional fair value of the identifiable assets and liabilities acquired and goodwill are set out below:

			Net amounts
			recognised for
		Sale of disposal	Australian and
	Recognised	groups and	New Zealand
	values on	repayment of	businesses
	acquisition	AXA SA debt(2)	acquired
	$m	$m	$m
Assets
Cash and cash equivalents	949	-	949
Receivables(1)	928	-	928
Current tax assets	8	-	8
Inventories and other assets	12	-	12
Investments in financial assets measured at fair value through profit or loss	12,962	-	12,962
Investments in financial assets measured at amortised cost	10	-	10
Investments in associates accounted for using the equity method	22	-	22
Investment property	11	-	11
Property, plant and equipment	31	-	31
Deferred tax asset	590	-	590
Intangible assets excluding goodwill	1,430	-	1,430
Assets of disposalgroups(2)	20,730	(20,730)	-
Total assets	37,683	(20,730)	16,953
Liabilities
Payables	496	-	496
Current tax liabilities	105	-	105
Provisions	234	-	234
Derivative financial liabilities	34	-	34
Borrowings	383	(383)	-
Subordinated debt	280	(280)	-
Deferred tax liabilities	256	-	256
External unitholders liabilities	310	-	310
Life Insurance contract liabilities	6,735	-	6,735
Investment contract liabilities	6,117	-	6,117
Defined benefit plan liability	149	-	149
Liabilities of disposalgroups(2)	10,908	(10,908)	-
Total liabilities	26,007	(11,571)	14,436
Net assets	11,676	(9,159)	2,517
Non controlling interests	(10)	-	(10)
Net identifiable assets and liabilities attributable to AMP Limited	11,666	(9,159)	2,507
Goodwill recognised on acquisition	1,777	-	1,777

(1) The carrying amount of receivables approximates the gross contractual amount. There are no contractual amounts at acquisition date which are not expected to be fully recovered.

(2) Disposal groups consist of AXA Asia Pacific Holdings Limited's Asian businesses and its ownership interests in joint ventures with AllianceBerstein LP. These disposal groups were sold through a series of transactions on 31 March 2011 and 1 April 2011.

AMP Limited Half Year Financial Report Notes to the financial statements for the half year ended 30 June 2011

17. MERGER WITH THE AUSTRALIAN & NEW ZEALAND BUSINESSES OF AXA ASIA PACIFIC HOLDINGS LIMITED (CONTINUED)

Acquisition related costs

Acquisition related costs of $34m (2010: $16m) were incurred in relation to the merger transaction. These costs have been included in other operating expenses in the period in which they were incurred.

Contingent liabilities

There were no material contingent liabilities recognised at acquisition date.

North product capital guarantee

National Mutual Funds Management Limited, a wholly owned subsidiary of AXA Asia Pacific Holdings Limited supports the product (“North”) which enables clients to invest their superannuation, pension and ordinary savings in a range of managed funds, with part or all of the total value of the investments guaranteed. The North guarantees are either term-based capital guarantees or provide a guaranteed level of income throughout the life of a client’s retirement. At 30 June 2011, $1.26 billion (30 March 2011: $1.27 billion) of funds under management were invested subject to the North guarantees. A fair value of $6m (30 March 2011: $3m) was recorded for the North guarantee liability at 30 June 2011. Hedging techniques are used to protect the AMP group against changes in the expected guarantee claim payments from market movements. AMP group also has the ability to review the periodic charge for new and existing clients. To the extent that the fair value of the guarantee is based on assumptions that may not be borne out in practice and that the hedge instruments used are not a perfect match for the expected guarantee payments, there is a residual risk that deviations from these assumptions may result in a profit or loss to shareholders.

Capital management

A number of the controlled entities of AXA Asia Pacific Holdings Limited are regulated by APRA and/or hold Australian Financial Services Licences and are subject to minimum regulatory capital requirements. All the AXA Asia Pacific Holdings Limited controlled regulated entities have at all times from 30 March 2011 to 30 June 2011 complied with the externally imposed capital requirements to which they are subject.

Identifiable intangibles

The fair value of identifiable intangible assets recognised on acquisition consists of the value of in-force business of $1,256m, distribution networks of $134m and software of $40m. These assets will be amortised on a straight-line basis over their remaining useful lives which have been estimated as follows:

Value of in-force business – 10 to 20 years
Distribution networks - 10 years
Software - 4 years

Goodwill

Goodwill arose in the business combination as the difference between the consideration paid and the fair value of net assets, identifiable intangible assets and contingent liabilities acquired. The goodwill balance is attributed to the skills and talent of the acquired business workforce, the benefit of expected head office and operational synergies, revenue growth and future market developments. These benefits are not recognised separately from goodwill as the future economic benefits arising from them cannot be measured reliably or they are not capable of being separated from the AMP group and sold, transferred, licensed, rented or exchanged either individually or together with any related contracts. Goodwill is not expected to be deductible for tax purposes.

Due to the complexity and timing of this merger, the fair values currently established are provisional and are subject to further review during the 12 month period following the merger. This could alter assets and liabilities as currently disclosed for 30 March 2011. Following the merger on 30 March 2011, AXA Asia Pacific Holdings Limited and its wholly owned Australian and New Zealand subsidiaries joined the AMP Limited tax consolidated group. This will result in the reset of the tax base of certain AXA Asia Pacific Holdings Limited assets. No adjustment has been made to estimate the reset tax base of AXA Asia Pacific Holdings Limited assets for the purposes of preparing these half year financial statements, as the financial effect of these entities joining the AMP Limited tax consolidated group has not been finalised. When the reset tax bases are finalised, they are likely to result in adjustments to certain deferred tax balances recognised by the AMP group with corresponding adjustments to goodwill.

Contribution to AMP group results

AXA Asia Pacific Holdings Limited contributed $23m for the period from 30 March 2011 to 30 June 2011, to the AMP group consolidated profit for the half year ended 30 June 2011, after amortisation of acquired intangible assets.

If the merger had occurred on 1 January 2011, AMP group revenue would have been $4,685m for the half year and net profit would have been $387m. This pro-forma financial information uses AXA Asia Pacific Holdings Limited data for the six month period ended 30 June 2011 and represents the historical operating results of AXA Asia Pacific Holdings Limited. It includes the results of the Asian businesses for the period 1 January 2011 to the dates of their disposal on 31 March 2011 and 1 April 2011 in accordance with the contractual arrangements for the merger.

AMP Limited Half Year Financial report

for the half year ended 30 June 2011

Directors’ declaration

In accordance with a resolution of the directors of AMP Limited, we state for the purposes of Section 303(4) of the Corporations Act 2001 that, in the opinion of the directors:

(a) there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable; and
(b) the financial statements and notes are in accordance with the Corporations Act 2001, including Section 304 (compliance with accounting standards) and Section 305 (true and fair view)

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PETER MASON Chairman

==> picture [137 x 42] intentionally omitted <==

CRAIG DUNN Managing Director and Chief Executive Officer

Sydney, 18 August 2011

To the members of AMP Limited

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Report on the Half-Year Financial Report

We have reviewed the accompanying half-yearfinancial report of AMP Limited, which comprises the
statement of financial position as at 30 June 2011, income statement and statement of comprehensive
income, statement of changes in equityand statement of cash flows for the half-yearended on that date,
notes comprising a summary of significant accounting policies and other explanatory information, and the
directors’ declaration of the consolidated entity comprising the company and the entities it controlled at
the half-year end or from time to time during the half-year.

Directors’ Responsibility for the Half-Year Financial Report

The directors of the company are responsible for the preparation of the half-year financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal controls as the directors determine are necessary to enable the preparation of the half-year financial report that is free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express a conclusion on the half-year financial report based on our review. We conducted our review in accordance with Auditing Standard on Review Engagements ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity , in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the financial report is not in accordance with the Corporations Act 2001 including: giving a true and fair view of the consolidated entity’s financial position as at 30 June 2011 and its performance for the half-year ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 . As the auditor of AMP Limited and the entities it controlled during the half-year, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of a half-yearfinancial report consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review procedures. A review is
substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and
consequently does not enable us to obtain assurance that we would become aware of all significant matters
that might be identified in an audit. Accordingly, we do not express an audit opinion.

Independence

In conducting our review, we have complied with the independence requirements of the Corporations Act 2001 . We have given to the directors of the company a written Auditor’s Independence Declaration, a copy of which is included in the Directors’ Report.

Liability limited by a scheme approved
under Professional Standards Legislation

Conclusion

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial report of AMP Limited is not in accordance with the Corporations Act 2001 , including:

a) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2011 and of its performance for the half-year ended on that date; and
b) complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

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Ernst & Young

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Andrew Price
Partner
Sydney
18 August 2011

AI assistant

AMP LIMITED — Interim / Quarterly Report 2011

64379_rns_2011-08-17_4debc25c-f0f0-4a17-8431-ecd6be37b0c6.pdf

AMP Limited (ASX/NZX: AMP) (also for release to AMP Group Finance Services Limited (ASX: AQNHA & NZX: AQN010))

DIRECTORS’ REPORT

Directors’ details

Principal activities

AMP Financial Services

AMP Capital Investors

AXA

DIRECTORS’ REPORT

Review of operations and results

Differences between underlying profit and statutory profit

Impact of accounting mismatches on profit

DIRECTORS’ REPORT

Capital management

Events occurring after the reporting date

Rounding

Auditor’s independence declaration to the directors of AMP Limited

AMP LIMITED ABN 49 079 354 519 HALF YEAR FINANCIAL REPORT

30 JUNE 2011

TABLE OF CONTENTS

Income statement

Footnote:

Statement of financial position

Footnote

Statement of changes in equity

Consolidated

Equity attributable to shareholders of AMP Limited

Footnote:

Statement of cash flows

Footnote:

1. BASIS OF PREPARATION AND ACCOUNTING POLICIES

(a) Basis of preparation

Significant judgements, estimates and assumptions

Changes in accounting policy

Australian Accounting Standards issued but not yet effective/Early adoption of Australian Accounting Standards

1. BASIS OF PREPARATION AND ACCOUNTING POLICIES (CONTINUED)

(b) Principles of consolidation

Securitisation vehicles

(c) Accounting mismatches

Treasury shares

Investments in controlled entities of the life entities’ statutory funds

1. BASIS OF PREPARATION AND ACCOUNTING POLICIES (CONTINUED)

Owner-occupied property

Life entities’ statutory funds’ superannuation products invested in AMP Bank assets

(d) Cash and cash equivalents

2. SEGMENT INFORMATION

(a) Segments - background

(b) Description of segments

2. SEGMENT INFORMATION (CONTINUED)

(c) Segment profit

2. SEGMENT INFORMATION (CONTINUED)

2. SEGMENT INFORMATION (CONTINUED)

3. INCOME

Footnote:

4. INVESTMENT GAINS AND (LOSSES)

Footnote:

5. EXPENSES

Footnote:

6. INCOME TAX

(b) Relationship between income tax expense and accounting profit

Footnote:

6. INCOME TAX (CONTINUED)

7. INVESTMENTS IN FINANCIAL ASSETS AND OTHER FINANCIAL LIABILITIES

Footnote

8. INVESTMENT PROPERTY

Footnote:

Valuation of investment property

9. PROPERTY, PLANT AND EQUIPMENT

Footnote:

10. INTANGIBLES

Footnote:

11. BORROWINGS

Footnote:

12. SUBORDINATED DEBT

Footnote:

13. DIVIDENDS

Footnote:

14. CONTRIBUTED EQUITY

AMP LIMITED Interim / Quarterly Report 2011