APRA to review AMP de-merger, and bans former CNAL exec
TheAustralian Prudential Regulation Authority(APRA) will be undertaking a significant review ofAMP’s proposal to de-merge its operations in Australia and the UK prior to regulatory approval to ensure it is in the interest of Australian beneficiaries.
However APRA’s initial view is that the proposal will have minimal impact on Australian policy holders and depositors.
To date, AMP’s Australian operations are currently meeting all of their prudential regulatory requirements, including capital requirements.
Trading in AMP Limited stocks was suspended yesterday following the announcement of a de-merger which would result in the Australasian operations being distanced from the group’s poorer performing northern hemisphere operations.
The Australian-based company will retain the AMP name while its UK-based arm will be branded Henderson.
The de-merger, predominantly relating to the UK Life Services business, will involve $2.6 billion in writedowns, however the group will undertake a $1.5 billion capital raising, comprising a $1 billion institutional placement and a $500 million Share Purchase Plan for Australian and New Zealand retail investors.
In other regulatory news, APRA has disqualified former director of failed trustee company Commercial Nominees of Australia Ltd (CNAL) Roger Paul Miekle from acting as a responsible officer of a superannuation investment manager or custodian.
APRA has previously disqualified ex-CNAL directors Andrew Skinner, Erica Robinson, Anthony Hall, Ross Honeyman, Carl Hanich and Peter Cain, and is considering further disqualifications of other ex-directors of the failed trustee company, whose superannuation fund members lost in excess of $30 million.
According to APRA, Miekle was deemed not to be a fit and proper person under the Superannuation Industry (Supervision) Act 1993, based on the view that he failed to exercise a reasonable degree of care and diligence in ensuring that CNAL carried out its trustee duties, although there were no findings of dishonesty.
Miekle has 21 days to appeal the decision, and may also pursue the matter in the Administrative Appeals Tribunal.
The Commonwealth Government has provided grants of financial assistance to superannuation funds formerly under the trusteeship of CNAL to the tune of $25 million with further compensation claims in relation to CNAL losses under consideration.
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