Ameriprise 2013 Annual Report Download - page 54

We expect that the Department of Labor will reissue proposed regulations in 2014 seeking to change the definition of who
is an investment advice fiduciary under ERISA and how such advice can be provided to accountholders in 401(k) plans and
IRAs. These proposed regulations will again be subject to a public comment period upon their release. We cannot predict
whether or when the regulations may be finalized, or how any final regulations may differ from the previously proposed
regulations. If the regulations were to be issued with provisions substantially similar to those of previous drafts, they could
impact how we receive fees, how we compensate our advisors, how we are able to retain advisors, and how we design our
investments and services for qualified accounts, any of which could negatively impact our results of operations.
Our insurance companies are subject to state regulation and must comply with statutory reserve and capital requirements.
State regulators continually review and update these requirements and other requirements relating to the business
operations of insurance companies, including their underwriting and sales practices. In December 2012, the NAIC adopted
a new reserve valuation manual that applies principles-based reserve standards to life insurance products. The valuation
manual becomes the effective reserve valuation method when adopted by 42 jurisdictions that account for at least 75% of
U.S. insurance premiums combined. To date, seven states have adopted the valuation manual. The requirement for
principles-based life insurance reserves may result in statutory reserves being more sensitive to changes in interest rates,
policyholder behavior and other market factors. It is not possible at this time to estimate the potential impact of future
changes in statutory reserve and capital requirements on our insurance businesses. Further, we cannot predict the effect
that proposed federal legislation, such as the option of federally chartered insurers or a mandated federal systemic risk
regulator, or future initiatives of the FIO within the Department of the Treasury, may have on our insurance businesses or
competitors. For additional discussion on the role and activities of the FIO, see the information provided under the heading
‘‘Regulation — Insurance Regulation’’ contained in Part I, Item 1 of this Annual Report on Form 10-K.
Changes in the supervision and regulation of the financial industry, both domestically and internationally, could
materially impact our results of operations, financial condition and liquidity.
The Dodd-Frank Act, enacted into law in 2010, called for sweeping changes in the supervision and regulation of the
financial services industry designed to provide for greater oversight of financial industry participants, reduce risk in banking
practices and in securities and derivatives trading, enhance public company corporate governance practices and executive
compensation disclosures, and provide greater protections to individual consumers and investors. Certain elements of the
Dodd-Frank Act became effective immediately, though the details of many provisions are subject to additional studies and
will not be known until regulatory agencies adopt final rules. The full impact of the Dodd-Frank Act on our company, the
financial industry and the economy cannot be known until the rules and regulations called for under the Act have been
finalized, and, in some cases, implemented over time.
Accordingly, while certain elements of these reforms have yet to be finalized and implemented, the Act has impacted and
is expected to further impact the manner in which we market our products and services, manage our company and its
operations and interact with regulators, all of which could materially impact our results of operations, financial condition
and liquidity. Certain provisions of the Dodd-Frank Act that may impact our business include but are not limited to the
establishment of a fiduciary standard for broker-dealers, the resolution authority granted to the FDIC, changes in regulatory
oversight and greater oversight over derivatives instruments and trading. We will need to respond to changes to the
framework for the supervision of U.S. financial institutions, including the creation of the FSOC. To the extent the
Dodd-Frank Act or other new regulation of the financial services industry impacts the operations, financial condition,
liquidity and capital requirements of unaffiliated financial institutions with whom we transact business, those institutions
may seek to pass on increased costs, reduce their capacity to transact, or otherwise present inefficiencies in their
interactions with us.
It is uncertain whether the Dodd-Frank Act, the rules and regulations developed thereunder, or any future legislation
designed to stabilize the financial markets, the economy generally, or provide better protections to consumers, will have
the desired effect. Any new domestic or international legislation or regulatory changes could require us to change certain
business practices, impose additional costs, or otherwise adversely affect our business operations, regulatory reporting
relationships, results of operations or financial condition. Consequences may include substantially higher compliance costs
as well as material effects on fee rates, interest rates and foreign exchange rates, which could materially impact our
investments, results of operations and liquidity in ways that we cannot predict. In addition, prolonged government support
for, and intervention in the management of, private institutions could distort customary and expected commercial behavior
on the part of those institutions, adversely impacting us.
In the wake of the recent financial crisis, other national and international authorities have also proposed measures
intended to increase the intensity of regulation of financial institutions, requiring greater coordination among regulators and
efforts to harmonize regulatory regimes. These measures have included enhanced risk-based capital requirements, leverage
limits, liquidity and transparency requirements, single counterparty exposure limits, governance requirements for risk
management, stress-test requirements, debt-to-equity limits for certain companies, early remediation procedures,
resolution and recovery planning and guidance for maintaining appropriate risk culture. Our international operations and our
worldwide consolidated operations are subject to the jurisdiction of certain of these non-U.S. authorities and may be
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