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Annual Report 2016

Annual Report 2016

2016 Annual Report

2016 Ameriprise Financial Consolidated Highlights

(in millions, except per share and as noted)

GAAP 2016 2015 2014
Net revenues $11,696 $12,170 $12,268
Net income from continuing operations attributable to Ameriprise Financial $1,314 $1,562 $1,621
Earnings from continuing operations per diluted share attributable to Ameriprise Financial common shareholders $7.81 $8.48 $8.31
Return on equity from continuing operations excluding accumulated other comprehensive income, net of tax 20.4% 21.5% 21.6%
Shareholders' equity $6,292 $7,191 $8,098
Shareholders' equity excluding accumulated other comprehensive income, net of tax $6,092 $6,938 $7,436
Operating(1,2) 2016 2015 2014
Net revenues $11,535 $11,734 $11,591
Earnings $1,427 $1,716 $1,662
Earnings per share $8.48 $9.32 $8.52
Return on equity from continuing operations excluding accumulated other comprehensive income, net of tax 22.2% 24.3% 23.1%

1 This Annual Report to Shareholders contains certain non-GAAP financial measures that management believes best reflect the underlying performance of our operations. Reconciliations of non-GAAP measures to the most directly comparable GAAP measure are on

2016 2015 2014
Assets under management and administration (in billions) $787 $777 $806
Weighted average common shares outstanding — diluted 168.2 184.2 195.0
Cash dividends paid per common share $2.92 $2.59 $2.26
Common stock shares repurchased 17.5 13.9 11.8

The schedule below is presented to provide insight into the effect of the company’s annual review of insurance and annuity valuation assumptions and model changes (unlocking) on certain non-GAAP financial measures. Given the non-cash nature of unlocking, management provides this additional detail to reflect the underlying performance of the business. See footnote 2 for more information about unlocking.

Operating EPS and ROE before annual unlocking effect 2016 2015 2014
Earnings per share $9.40 $9.17 $8.66
Return on equity from continuing operations excluding accumulated other comprehensive income, net of tax 24.6% 24.0% 23.5%

2 Results include the non-cash impact of unlocking, which reflects the company’s annual review of market-related inputs and model changes related to our living benefit valuation, insurance and annuity valuation assumptions relative to current experience and management expectations, and premium deficiency testing. To the extent that expectations change as a result of this review, the company updates assumptions and models and the impact is reflected as part of annual unlocking.


Dear fellow shareholders,

On behalf of all of us at Ameriprise Financial, thank you for your interest in and support of our company. In this letter, I’ll discuss why I feel good about Ameriprise, our progress in a challenging year and how we’re well positioned to continue delivering meaningful shareholder value.

(Continued below)


James M. Cracchiolo
Chairman and Chief Executive Officer


Assets under management and administration

$ in billions

With $787 billion in assets under management and administration, Ameriprise Financial is one of the largest diversified financial services companies and a recognized leader in the industry.


As I reflect on the year, the uncertainty in the operating environment was a pervasive theme.

The year began with significant equity market volatility amid concerns of slower global economic growth. While equity markets recovered in the second half of the year, investor unease persisted, fueled by the uncertain political landscape in the U.S. and Europe that proved historic and remains today. In the U.S., the outcome of the presidential election elicited a level of surprise for many as investors contemplated the impact of policy changes in Washington. In addition, U.S. interest rates remained stubbornly low even with the small increase that occurred near the end of the year.

Finally, the regulatory change agenda for the financial services industry was significant, including the U.S. Department of Labor (DOL) fiduciary rule and multiple regulatory changes in the UK and Europe.

This backdrop affected consumers, the financial services industry and our firm. Ameriprise is an increasingly global firm, and in 2016 our assets under management and administration increased 1% to $787 billion, which included an $18 billion unfavorable impact from foreign exchange translation in Asset Management.

In terms of financial results, operating total net revenues were down slightly to $11.5 billion. Operating earnings per diluted share (EPS) declined 9% to $8.48 as we absorbed higher non-cash, accounting-related expenses from our annual review of insurance and annuity valuation assumptions (unlocking) that were largely driven by low interest rates. Before the annual unlocking effect, operating EPS increased 3% from a year ago.

At Ameriprise, we have consistently demonstrated our ability to navigate tumultuous conditions. While the external challenges in 2016 pressured our results and the financial services industry, we believe they also presented an important opportunity for Ameriprise to further distinguish ourselves in the marketplace.

Operating earnings per diluted share

Before annual unlocking effect, 2016 Operating EPS was $9.40 vs. $9.17 in 2015

Operating return on equity ex. AOCI*

Before annual unlocking effect, 2016 Operating ROE excluding AOCI was 24.6% vs. 24.0% in 2015

*Accumulated other comprehensive income


Financial planning leader in the U.S.

#1 in investment industry in Temkin Group’s 2016 Net Promoter Score Benchmark Study

A top performer in customer ratings based on “unbiased and puts my interest first,” investment firm category in the Hearts and Wallets 2016 Wants and Pricing survey

2 million+ individual, institutional and small business clients

$787 billion in assets under management and administration

More CFP® professionals than any other firm

#34 global asset manager

120+ year legacy

(See disclosures below)


Our strategy remains consistent: We advise, manage and protect assets and income for individual, small business and institutional clients. In these uncertain times, what Ameriprise does is even more relevant.


Our mission is to help our clients feel confident about their financial future. Ameriprise has endured and thrived for more than a century because our clients come first in our decisions and actions.

Our diversified business—consisting of Advice & Wealth Management, Annuities, Protection and Asset Management—allows us to serve our clients’ needs comprehensively and generate good earnings and strong free cash flow across market cycles.

The strength of our financial foundation is a clear differentiator for Ameriprise. It ensures we can be flexible and opportunistic and it’s fundamental to our ability to deliver long-term shareholder value. As we invest in key growth initiatives and maintain a strong excess capital position, we continue to return capital to our shareholders at a meaningful level.

In 2016, we returned nearly $2.2 billion to shareholders through share repurchases and by increasing our quarterly dividend by 12%—the 11th increase in the past 11 years. In fact, 2016 represented the sixth consecutive year that we returned more than 100% of operating earnings to shareholders.


Differentiated financial strength and capital return

Dividends/share repurchases
$ in millions

Dividends paid

Common stock share repurchases

  • Approximately $2 billion in excess capital
  • Strong ratings and risk management
  • High-quality investment portfolio
  • Ample liquidity

With solid earnings and strong capital management, our operating return on equity excluding accumulated other comprehensive income (ROE, ex. AOCI) was 22.2%, which remains among the best in financial services. Before the annual unlocking effect, operating ROE, ex. AOCI was even stronger at 24.6%.

The total return for Ameriprise Financial common stock in 2016 was 8%. Over the long term, Ameriprise total shareholder return remains strong on a return and absolute basis, with a 153% return over the past five years and 286% since 2005.

Our ability to create value is derived from the progress we are making in the business.

In Advice & Wealth Management, we have built a powerful business with a significant long-term growth opportunity to serve more individuals who need advice.


We are America’s leader in financial planning, a position we’ve proudly held for many years. We help our clients address their entire financial needs across market cycles and their lifetimes. What sets us apart is not just what we do, but how we do it. Through comprehensive financial planning, our advisors gain a deep understanding of client needs and recommend actions that address cash management, savings, borrowing, investing, protection, retirement income and legacy planning.

Our strong reputation and high client retention and satisfaction are important to us and something we work diligently to maintain and strengthen. In 2016, Ameriprise was again recognized as a leader in the industry for the way we work with our clients. This included ranking #1 in the investment industry in Temkin Group’s 2016 Net Promoter Score Benchmark survey. This recognition relative to the industry reinforces the unique value our clients see in our comprehensive advice approach.


Ameriprise advisor client assets

$ in billions

Fueled by strong retention, client acquisition and net inflows, retail client assets grew to a record high in 2016.


We continued to build on our successful Be Brilliant.® national advertising campaign, which conveys the benefits of working with an Ameriprise advisor and drove brand awareness to a record high in 2016. The campaign tells the story of how Ameriprise and our advisors inspire confidence and help our clients achieve their goals. In fact, our Be Brilliant.® campaign earned the Financial Communications Society Portfolio Gold award in the Consumer Television Campaign category.

Our Be Brilliant.® brand platform illustrates the everyday moments of brilliance clients can realize by working with the right advisor and right firm. Since launching in 2015, the campaign contributed to record levels of brand awareness in 2016.


Our target market—the mass affluent and affluent consumer—is the fastest growing wealth segment and controls almost half of all investable assets in the U.S. As we look to serve more clients in comprehensive advice relationships, our effective Confident Retirement® approach resonates strongly with clients: 94% agree the advice met their needs; 91% are committed to implement; and 89% are likely to recommend Ameriprise.

We also know that there is a large opportunity to serve younger generations—people who are accumulating wealth and value a human perspective and personal interaction when saving, investing and protecting their assets. In 2016, we further expanded our Confident Retirement approach to serve these individuals with our Wealth Builders program.


Our Be Brilliant.® campaign features people living the full and rich lives they've earned.


Client assets in fee-based wrap accounts

$ in billions

$10.2 billion of net inflows in 2016


Personal relationships define how we serve clients. We work with our clients when, where and how they want to be served. For many, it’s face to face, but we also engage clients and prospects through our secure website and mobile app. We’re seeing meaningful growth in clients looking for digitally enabled engagement supported by a personal advisor relationship, and we expect this trend to continue.

We consistently invest in capabilities to help our advisors deliver an exceptional experience for clients and to grow their practices. In addition to a robust product portfolio, local leaders and practice support, we’re enhancing our technology and digital tools. As a result, our advisors are increasingly efficient and productive as they leverage technology to deliver advice and meet our clients’ evolving preferences.

The Ameriprise culture and level of support is attractive to our advisors and in the industry. Our advisors continue to be highly satisfied, practice retention is in the 90s and our advisor productivity consistently grows at a faster rate than others in the industry. In addition, we recruited another 325 high-quality, experienced advisors to Ameriprise in a year when recruiting in the industry slowed.

With our strong advice platform, retail client assets grew to a record $479 billion, and we generated more than $10 billion in net inflows in fee-based wrap accounts. Our investment advisory platform ended the year with more than $200 billion in client AUM, placing it among the top five largest in the industry and representing a significant growth driver for the firm.

The introduction of the DOL fiduciary rule presented a significant and complex change for the industry. Consistent with our financial planning leadership, we are one of the largest providers of fee-based investment advice and already operate under the long-standing SEC fiduciary standard of care. We also benefit from the steady investments we’ve made to establish a strong supervision and compliance foundation, including our infrastructure, policies and disclosures.

In 2016, we dedicated significant resources and management time to prepare to adapt to this regulatory change. We have long maintained and advocated for investors having access to significant choice and a broad array of products to meet their needs. As of this writing, the new administration has directed the DOL to further review the rule, and we will remain engaged.

Overall, in a tougher year, we delivered good growth and profitability in Advice & Wealth Management while simultaneously navigating changes associated with the DOL fiduciary rule. As we look forward, we’re focused on the right things: growing client assets the right way; further differentiating Ameriprise in a competitive marketplace; ensuring our advisors are prepared and see the opportunities comprehensive advice provides; and finally, enhancing our capabilities so we may continue to deliver quality, personal service.

The need for personalized advice and a thoughtful perspective in this uncertain economic environment is growing. As the leader in financial planning and advice, it sets us apart and presents a unique opportunity for us to serve even more investors.


Operating and revenue per advisor

$ in thousands

1,648 experienced advisors have moved their practices to Ameriprise in the last five years


Protection and Annuities are important to serving clients’ long-term security needs.


RiverSource Insurance and Annuities—our life, health and annuity businesses—help ensure we can meet our clients’ retirement income and protection needs while also delivering competitive shareholder returns.

We’ve established attractive businesses with competitive products and unique risk characteristics as we focus our distribution to Ameriprise clients. We compete with third-party providers in the Ameriprise channel and we offer our products as long-term solutions within a financial plan rather than as commodity products. Our focus remains on prudent growth over time as part of our diversified business. We value the strategic benefits our insurance and annuities businesses provide—from contributing to high client satisfaction and asset persistency to the connection with our asset management business for the management of our insurance assets. They are complementary businesses.

In 2016, we focused on helping our advisors deliver insurance and annuity solutions that are important components of our Confident Retirement approach. In addition, we further developed our product line, adding three new managed volatility funds to our variable annuity offering and reinforcing the benefits cash value life insurance provides for clients seeking to grow and protect their wealth.

Through investments in digital capabilities and other tools, we’re making it easier for advisors to offer these long-term products within their practices. While our variable annuity and life and health insurance assets were up on market gains, earnings in the businesses declined from a year ago as higher expenses reflected the non-cash impact of unlocking.

Our exclusive Confident Retirement approach brings together our capabilities to help address a critical consumer need—planning and preparing for retirement.



Additionally, we continue to make progress in our direct property/casualty insurance business. Client satisfaction remains strong as we work to improve the financial performance of the business. The new team in place has improved the sophistication of our pricing, streamlined the markets we’re competing in, tightened underwriting and enhanced risk exposures. We are seeing improved results. The business is heading in the right direction.

In Asset Management, we’ve built a global business with broad capabilities and we’re delivering competitive profitability while managing industry headwinds.


Asset Management is important to our diversified business and growth strategy. At Columbia Threadneedle Investments, we’re focused on building on our strong positions in the U.S. and UK and expanding our client reach in key markets in Europe, the Middle East and Asia.

We have more than $450 billion in assets under management and are among the top 35 largest global asset managers. Columbia Threadneedle is an active manager with a clear focus on delivering value to our clients. This includes generating an income stream in retirement, navigating changing interest rates, maximizing after-tax returns, growing and preserving assets and easing the impact of volatile markets.

With more than 450 investment professionals and a presence in 19 countries, our teams are focused on delivering outcomes investors expect. Columbia Threadneedle has proven expertise in credit, concentrated equities, asset allocation and multi-asset/managed funds. We deliver a global perspective, maximizing the benefits from our investment desks and excellent research.

Our investment teams are highly regarded, and as of year end, we had 112 four- and five-star Morningstar-rated funds and were recognized with more than 40 investment awards in 2016, including five Lipper fund awards in the U.S. and the Best UK Equity Fund from Morningstar UK.

We’re building stronger and more competitive franchises across targeted product lines such as our growing multi-asset solutions business, and we both streamlined existing products and launched new products. These included three new strategic beta products in the U.S. and four new funds for the European market.

With the intense market volatility and significant geopolitical change during the year, our investment perspective was in high demand. Our teams worked closely with investors and advisors to help them benefit from our guidance. That included leading up to and after the Brexit vote, which led to higher than expected client outflows in the UK and Europe, similar to other players.

We remain focused on our UK and European clients during what will be a multi-year transition for the UK. While our investment teams in the region are London based, Columbia Threadneedle has an established fund range and presence in Continental Europe. We are working to expand the scope of our Luxembourg-based management company and further replicate a more complete product line. Like the industry, we will be looking for further clarification that will inform us and others about how to manage the transition for clients. This will take time, but I feel that we’re in a good position.



In the U.S., we are experiencing a level of outflows in traditional active strategies that reflect the industry shift to passive. That said, we’re gaining traction from our actions and growing share on key intermediary platforms during a period when overall gross sales in active strategies declined. In addition, outflows in legacy former-parent relationships continued as expected, although they did improve from last year.

With $194 billion in assets, the institutional business represents an important long-term growth driver. We had strong interest in credit and risk strategies, but like others, we experienced a delay in funding during the year. Given the large size of investment mandates, flows in any one year can be uneven. That said, our new business pipeline and “won/not funded” business remains strong.

The team is executing well and managing the pressure from passive strategies and regulatory change. We’re adding to our product lines, enhancing our global operations infrastructure and accelerating our strategic beta initiatives in the U.S. both organically and through the acquisition of Emerging Global Advisors.

In Asset Management, we delivered another year of solid earnings in a tough environment. Importantly, we’re diligently managing expenses to mitigate revenue pressure while investing in long-term growth initiatives. Our profitability is competitive with other active players, and we’re focused on delivering value to our clients and positioning the business for long-term growth. We expect consolidation will reshape the industry over the next several years and we’re well positioned to benefit from our scale and capital strength. As we consider inorganic opportunities to accelerate our growth, we will continue to adhere to our disciplined approach.

Ameriprise is a reflection of our people—we’re a team guided by our values and focused on delivering for all our constituents.


Ameriprise is powerful not only financially but also because of the collective contributions from our terrific team of more than 20,000 people and our commitment to meeting clients’ needs—a commitment we strive to meet every day. We care about our clients, our communities and how we work with each other. In 2016, Ameriprise continued to earn meaningful recognition for the way we do business.


Corporate Philanthropy — 2016 Financial Institutions award at the annual Invest in Others Community Leadership Awards for our ongoing commitment to encouraging philanthropic activities at Ameriprise

An industry leader for employee engagement and leadership effectiveness

100% rating on the Corporate Equality Index by the Human Rights Campaign for the 11th consecutive year as a “Best Place to Work” designation for LGBT equality

“Best Place to Work” by the Minneapolis-St. Paul Business Journal—for the seventh time

A Yellow Ribbon Company by the state of Minnesota for our military support as well as a Military Friendly® Employer for the second consecutive year

A Culture of

Giving Back

Our Values...

Client Focused

Integrity Always

Excellence in all we do

Respect for individuals and for the communities in which we live and work



Ameriprise volunteers packing food items in Minneapolis during our National Days of Service


In closing, I feel good about how Ameriprise is positioned during a period of change for the industry and our focus on serving clients and advisors.


The uncertainty of the operating environment is a constant and emphasizes the need for a long-term financial plan and strong-performing products and solutions. That’s what we provide.

With significant long-term industry growth trends in comprehensive advice as well as asset management, Ameriprise has a terrific opportunity to serve more clients’ financial needs and earn greater market share. Though we know the environment will continue to pose challenges for our industry, Ameriprise has a record of expertly navigating difficult times and emerging in an even stronger position for growth.

I’m energized about the future of our firm and what we can achieve. What we do and how we do it is unique and sought-after. We can help more individuals, small businesses and institutions navigate these uncertain times and maintain appropriate perspective. We have the right strategy and the right team to be successful, and we will continue to focus on executing with excellence and serving our clients’ needs.

It’s important to me to recognize and express my gratitude to all of the people associated with Ameriprise Financial.

  • To our clients, thank you for entrusting your goals and assets to Ameriprise. We greatly value your business and will continue to work diligently to deliver value to you and help you achieve your goals.
  • To our more than 20,000 employees and advisors, thank you for your commitment, energy and enthusiasm. I appreciate all you do for our clients every day.
  • To my fellow members of the Ameriprise Financial board of directors, thank you for your counsel and support. We all benefit from your perspective.
  • And finally, to our shareholders, thank you for your trust and confidence in Ameriprise. We will continue to do all we can to reward it.

Respectfully yours,

James M. Cracchiolo
Chairman and Chief Executive Officer


General Information


Executive Offices

Ameriprise Financial Center
707 2nd Avenue South
Minneapolis, MN 55474
612.671.3131

7 World Trade Center
250 Greenwich Street, Suite 3900
New York, NY 10007

Information Available to Shareholders

Copies of our company's Annual Report on Form 10-K, proxy statement, press releases and other documents, as well as information on financial results and products and services, are available through the Ameriprise Financial website at ameriprise.com. Written copies of these materials are available without charge, upon written request to the corporate secretary's office.

Stock Exchange Listing

New York Stock Exchange
Symbol: AMP

Independent Registered Public Accounting Firm

PricewaterhouseCoopers LLP
225 South 6th Street, Suite 1400
Minneapolis, MN 55402

Transfer Agent

Computershare Trust Company, N.A.
P.O. Box 30170
College Station, TX 77842
866.337.4999
(U.S. and Canada only)
781.575.3223 (International)

Email:
web.queries@computershare.com
Website:
computershare.com/ameriprise

Annual Meeting

The 2017 Annual Meeting of Shareholders of Ameriprise Financial will be held at our Minneapolis headquarters at 707 2nd Avenue South, Minneapolis, MN 55474, on Wednesday, April 26, 2017, at 11 a.m. Central time. A written or audio transcript of the meeting will be available upon written request to the corporate secretary’s office. There will be a modest charge to defray production and mailing costs.

Shareholders

As of Feb. 10, 2017, there were 13,801 shareholders of record. Copies of the Ameriprise Financial Corporate Governance Guidelines, as well as the charters of the four standing committees of the Board of Directors and the Ameriprise Financial Global Code of Conduct, are available on the company’s website at ir.ameriprise.com. Our website also provides important information about how and when we grant share-based compensation such as stock options and restricted stock, including the schedule of grant dates for 2017. We provide a copy of our Long-Term Incentive Awards Policy on our website and explain our policy for the approval of grants on a date when the Compensation and Benefits Committee of the Board of Directors or our chairman and chief executive officer is aware of material, nonpublic information about our company or its securities. Copies of these materials are available without charge upon written request to the corporate secretary’s office.

We filed the Certifications of our chief executive officer and chief financial officer with the Securities and Exchange Commission pursuant to section 302 of the Sarbanes- Oxley Act of 2002 as exhibits 31.1 and 31.2, respectively, to our Annual Report on Form 10-K for the year ended Dec. 31, 2016.

Shareholder and Investor Inquiries

Written shareholder inquiries may be sent to:

Computershare Shareholder Services
P.O. Box 30170
College Station, TX 77842

or to:
Corporate Secretary's Office
1098 Ameriprise Financial Center
Minneapolis, MN 55474

Written inquiries from the investment community should be sent to:

Investor Relations
243 Ameriprise Financial Center
Minneapolis, MN 55474

Trademarks

The following service marks of Ameriprise Financial, Inc. and its affiliates appear in this report:

Ameriprise Financial®

Be Brilliant®

Columbia Threadneedle Investments®

Confident Retirement®

This report was printed using a printer recognized by the Printing Industry of Minnesota for its green initiatives and is certified as a Very Small Quantity Generator. The press used to print the report emits no volatile organic compounds.

Executive Leadership Team

James M. Cracchiolo
Chairman and Chief Executive Officer

Walter S. Berman
Executive Vice President and Chief Financial Officer

Kelli A. Hunter
Executive Vice President, Human Resources

Randy C. Kupper
Executive Vice President and Chief Information Officer

Neal Maglaque
President, Advice & Wealth Management
Business Development and Chief Operating Officer

Deirdre D. McGraw
Executive Vice President, Marketing, Corporate
Communications and Community Relations

Colin Moore
Executive Vice President, Global Chief Investment Officer

Patrick H. O’Connell
Executive Vice President, Ameriprise Advisor Group

Joseph E. Sweeney
President, Advice & Wealth Management
Products and Service Delivery

Karen Wilson Thissen
Executive Vice President and General Counsel

William F. (Ted) Truscott
Chief Executive Officer, Global Asset Management

William J. (Bill) Williams
Executive Vice President, Ameriprise Franchise Group

John R. Woerner
President, Insurance & Annuities and Chief Strategy Officer

Board of Directors

James M. Cracchiolo
Chairman and Chief Executive Officer
Ameriprise Financial, Inc.

Dianne Neal Blixt
Former Executive Vice President
and Chief Financial Officer
Reynolds American, Inc.

Amy DiGeso
Former Executive Vice President
Global Human Resources
The Estée Lauder Companies Inc.

Lon R. Greenberg
Chairman Emeritus and Former
Chairman and Chief Executive Officer,
UGI Corporation

Siri S. Marshall
Former Senior Vice President
and General Counsel
General Mills, Inc.

Jeffrey Noddle
Former Chairman
SUPERVALU INC.

H. Jay Sarles
Private Investor
Former Vice Chairman
Bank of America

Robert F. Sharpe, Jr.
Former President
Commercial Foods and
Chief Administrative Officer
ConAgra Foods, Inc.

Christopher J. Williams
Chief Executive Officer and Founder
The Williams Capital Group, L.P.

NOTE: Messrs. O’Connell and Williams are not executive officers of Ameriprise Financial for the purposes of Section 16 of the Securities Exchange Act of 1934, as amended.


Performance Graph


The graph below compares the cumulative five-year total return for shareholders of Ameriprise Financial, Inc. common stock with the cumulative total returns of the S&P 500 Index and the S&P 500 Financials Index. The graph tracks the performance of a $100 investment in our common stock and in each index (with the reinvestment of all dividends) from Dec. 31, 2011 to Dec. 31, 2016.

Comparison of a five-year cumulative total return*
Ameriprise Financial, Inc., the S&P 500 Index and the S&P 500 Financials Index


Performace Chart

Ameriprise Financial, Inc.

S&P 500 Index

S&P 500 Financials Index

*$100 invested on Dec. 31, 2011 in stock or index, including reinvestment of dividends.

Fiscal year ending Dec. 31.

The Standard & Poor's 500 Index (S&P 500® Index), an unmanaged index of common stocks, is frequently used as a general measure of market performance. The Index reflects reinvestment of all distributions and changes in market prices, but excludes brokerage commissions or other fees. The S&P 500 Financials Index measures the performance of financial components of the S&P 500 Index.

Past performance does not guarantee future results. It is not possible to invest directly in an index.

Copyright © 2017 S&P, a division of The McGraw-Hill Companies. All rights reserved.


This report is not a solicitation for any of the products or services mentioned. Investment products, including shares of mutual funds, are not FDIC or otherwise federally insured, are not deposits or obligations, or guaranteed by any financial institution, and involve investment risks, including possible loss of principal and fluctuation in value.

Past performance does not guarantee future results. Actual results may vary materially from our plans, estimates and beliefs. Please review carefully the discussion captioned “Forward- Looking Statements” contained in Part II, Item 7 in our Annual Report on Form 10-K for the year ended Dec. 31, 2016. For each fund with at least a three-year history, Morningstar calculates a Morningstar RatingTM based on a Morningstar Risk Adjusted Return measure that accounts for variation in a fund’s monthly performance (including the effects of sales charges, loads, and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10% receive 1 star. (Each share class is counted as a fraction of one fund within this scale and rated separately, which may cause slight variations in the distribution percentages.) The Morningstar Rating™ is for class Z shares only; other classes may have different performance characteristics and may have different ratings.

The following describes the principal subsidiaries that conduct the financial planning, asset accumulation and income, and protection businesses of Ameriprise Financial, Inc. Columbia Mutual Funds are distributed by Columbia Management Investment Distributors, Inc., member FINRA, and managed by Columbia Management Investment Advisers, LLC. Threadneedle International Limited is an FCA- and an SEC-registered investment adviser and an affiliate of Columbia Management Investment Advisers, LLC, based in the U.K. RiverSource insurance and annuity products are issued by RiverSource Life Insurance Company and, in New York, by RiverSource Life Insurance Co. of New York, Albany, NY, and distributed by RiverSource Distributors, Inc. Auto and home insurance is underwritten by IDS Property Casualty Insurance Company, or in certain states, Ameriprise Insurance Company. Personal trust services are offered through Ameriprise National Trust Bank. Ameriprise Financial Services, Inc. Member FINRA and SIPC. Investment advisory services and products are made available through Ameriprise Financial Services, Inc., a registered investment adviser.

Columbia Threadneedle Investments is the global brand name of the Columbia and Threadneedle group of companies.

Source: Financial planning leader: Ameriprise helped pioneer the financial planning process more than 30 years ago. We have more CERTIFIED FINANCIAL PLANNERTM professionals than any other company in the U.S. as documented by the Certified Financial Planner Board of Standards, Inc., as of Dec. 31, 2016. #34 global asset manager: Pensions & Investments / Willis Towers Watson World 500: World’s Largest Money Managers, as of Dec. 31, 2015. Industry-leading engagement. Top 5 wrap program: Cerulli Edge Managed Accounts Edition – data as of Q3 2016.

Less: Market impact on indexed universal life benefits
($ in millions) 2016 2015 2014
Total net revenues $11,696 $12,170 $12,268
Less: Revenues attributable to the CIEs 128 446 651
Less: Net realized investment gains 6 4 37
24 7 (11)
Less: Market impact of hedges on investments 3 (21)
Operating total net revenues $11,535 $11,734 $11,591
($ in millions) 2016 2015 2014 2013 2012
Net income attributable to Ameriprise Financial $1,314 $1,562 $1,619 $1,334 $1,025
Less: Income (loss) from discontinued operations, net of tax (2) (3) (2)
Net income from continuing operations attributable to Ameriprise Financial 1,314 1,562 1,621 1,337 1,027
Less: Adjustments(1) (113) (154) (41) (123) (214)
Operating earnings 1,427 1,716 1,662 $1,460 $1,241
Less: Annual unlocking effect, net of tax(2) (153) 27 (28)
Operating earnings before annual unlocking effect $1,580 $1,689 $1,690
Ameriprise Financial shareholders’ equity(3) $6,877 $7,782 $8,244 $8,556 $9,047
Less: Accumulated other comprehensive income (loss), net of tax "AOCI"(3) 426 516 734 821 1,001
Ameriprise Financial shareholders’ equity from continuing operations excluding AOCI(3) 6,451 7,266 7,510 7,735 8,046
Less: Equity impacts attributable to the consolidated investment entities(3) 27 216 311 333 397
Operating equity(3) $6,424 $7,050 $7,199 $7,402 $7,649
Return on equity from continuing operations, excluding AOCI 20.4% 21.5% 21.6% 17.3% 12.8%
Operating return on equity, excluding AOCI(4) 22.2% 24.3% 23.1% 19.7% 16.2%
Operating return on equity, excluding AOCI before annual unlocking effect(4) 24.6% 24.0% 23.5%

(1) Adjustments reflect the trailing twelve months’ sum of after-tax net realized investment gains/losses, net of deferred sales inducement costs (“DSIC”) and deferred acquisition costs (“DAC’) amortization, unearned revenue amortization and the reinsurance accrual; the market impact on variable annuity guaranteed benefits, net of hedges and the related DSIC and DAC amortization; the market impact on indexed universal life benefits, net of hedges and the related DAC amortization, unearned revenue amortization, and the reinsurance accrual; the market impact of hedges to offset interest rate changes on unrealized gains or losses for certain investments; integration/restructuring charges; and the impact of consolidating certain investment entities. After-tax is calculated using the statutory tax rate of 35%.

(2) After-tax is calculated using the statutory tax rate of 35%.

(3) Amounts represent the five-point average of quarter-end balances.

(4) Operating return on equity excluding accumulated other comprehensive income/loss (AOCI) is calculated using the trailing twelve months of earnings excluding the after-tax net realized investment gains/losses, net of DSIC and DAC amortization, unearned revenue amortization and the reinsurance accrual; market impact on variable annuity guaranteed benefits, net of hedges and related DSIC and DAC amortization; the market impact on indexed universal life benefits, net of hedges and related DAC amortization, unearned revenue amortization, and the reinsurance accrual; the market impact of hedges to offset interest rate changes on unrealized gains or losses for certain investments; integration/restructuring charges; the impact of consolidating certain investment entities; and discontinued operations in the numerator, and Ameriprise Financial shareholders’ equity excluding AOCI and the impact of consolidating investment entities using a five-point average of quarter-end equity in the denominator. After-tax is calculated using the statutory tax rate of 35%.

Per Diluted Share
($ in millions, except per share amounts) 2016 2015 2014 2013 2012 2016 2015 2014 2013 2012
Net income attributable to Ameriprise Financial $1,314 $1,562 $1,619 $1,334 $1,025 $7.81 $8.48 $8.30 $6.44 $4.60
Less: Income (loss) from discontinued operations, net of tax (2) (3) (2) (0.01) (0.02) (0.01)
Net income from continuing operations attributable to Ameriprise Financial 1,314 1,562 1,621 1,337 1,027 7.81 8.48 8.31 6.46 4.61
Less: Net income (loss) attributable to consolidated investment entities (2) (0.01)
Less: Net realized investment gains(1) 6 4 37 7 7 0.03 0.02 0.19 0.03 0.03
Add: Integration/restructuring charges, net of tax(1) 5 14 71 0.03 0.06 0.32
Add: Market impact on variable annuity guaranteed benefits, net of tax(1) 216 214 94 170 265 1.28 1.16 0.48 0.82 1.19
Add: Market impact on indexed universal life benefits, net of tax(1) (36) 1 6 13 (0.21) 0.01 0.03 0.06
Add: Market impact of hedges on investments, net of tax(1) (3) 21 (0.02) 0.11
Add: Tax effect of adjustments(2) (60) (83) (22) (67) (115) (0.36) (0.45) (0.11) (0.32) (0.52)
Operating earnings 1,427 1,716 1,662 $1,460 $1,241 8.48 9.32 8.52 $7.05 $5.57
Less: Pretax annual unlocking effect (235) 42 (43) (1.40) 0.23 (0.22)
Less: Tax effect of annual unlocking effect(2) 82 (15) 15 0.48 (0.08) 0.08
Operating earnings before annual unlocking effect $1,580 $1,689 $1,690 $9.40 $9.17 $8.66
(1) Pretax operating adjustment.
(2) Calculated using the statutory tax rate of 35%.