Euromoney, April 1 2021
Francesco de Ferrari gave up a plum private banking job at Credit Suisse to take over troubled AMP. It was always a tough ask. Personnel mis-steps did not help, but in the end there was not going to be much of a business left for him to run.
Euromoney remembers sitting down with Francesco de Ferrari one day in 2018 in Credit Suisse’s Singapore offices at One Raffles Link with a view over the Padang playing fields. He was as apparently relaxed and genial as usual, at the top of the Asia-Pacific private banking business that was increasingly the engine room of the whole bank. But when the interview was done and the conversation turned to Australia, he seemed particularly interested.
So, when the news came in August that year that he would become CEO of AMP, our first thought was: well, that makes sense of that chat. The second was: what the hell is he doing?
At the time he joined, AMP was coming out of the Royal Commission in worse shape than anyone, which was a singular achievement, given how grim the position was for the entire industry at the time. CEO Craig Meller had been kicked out by the board, followed a week later by that board’s chair, Catherine Brenner, after it had become clear that AMP had misled the corporate regulator, the Australian Prudential Regulation Authority, on the charging of customers for advice it never gave.
It would later become clear that AMP had been continuing to charge fees to people who had been dead for years.
AMP was a powerful business, iconic in Australia, and had been perfectly placed in the country’s heavily intermediated wealth management market. Its investment platform ranked second in the industry at the time, with A$143.1 billion ($108.6 billion) under management. It had the most powerful aligned financial planner network in Australia.
But it also seemed an enterprise out of time, with the prevailing winds pushing for greater separation between banking and wealth management advice, and for a time there were concerns that the Royal Commission might require AMP’s entire business model to be ripped up. That didn’t happen in the end, but nevertheless AMP’s conglomerate model of bank, superannuation/managed funds and financial advice is being prised apart anyway.
De Ferrari was hired partly because he had nothing to do with financial services in Australia. He had spent no time at any institution being shredded by the Royal Commission, and would bring new ideas from his time at Credit Suisse. But it was always a mighty job to turn AMP around.
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