Ameriprise 2013 Annual Report Download - page 88

Our Corporate & Other segment pretax operating loss excludes net realized gains or losses, the impact of consolidating
CIEs and restructuring charges. Our Corporate & Other segment pretax operating loss was $345 million for the year ended
December 31, 2013 compared to $270 million for the prior year. Operating losses during the year ended December 31,
2013 included a loss of $31 million primarily due to how we offset accretion from an intercompany transfer of former bank
assets. Approximately $23 million of this loss was reflected in net investment loss and approximately $8 million was
reflected in general and administrative expense. The loss of $23 million in the Corporate & Other segment was offset by
the associated incremental accretion income, primarily in the Annuities segment, that relates to the transfer of the bank
assets and eliminates on a consolidated basis. Corporate & Other segment results also reflected $29 million of higher
interest and debt expense compared to the prior year due to $19 million in costs related to the early retirement of
$350 million of our senior notes due 2015, as well as higher interest expense due to the issuance of debt in 2013.
General and administrative expense for the prior year included a $15 million benefit from a settlement with a third-party
service provider.
Consolidated Results of Operations
Year Ended December 31, 2012 Compared to Year Ended December 31, 2011
The following table presents our consolidated results of operations:
Years Ended
December 31,
2012 2011 Change
(in millions)
Revenues
Management and financial advice fees $ 4,692 $ 4,537 $ 155 3%
Distribution fees 1,616 1,573 43 3
Net investment income 1,933 2,046 (113) (6)
Premiums 1,223 1,220 3 —
Other revenues 795 863 (68) (8)
Total revenues 10,259 10,239 20 —
Banking and deposit interest expense 42 47 (5) (11)
Total net revenues 10,217 10,192 25 —
Expenses
Distribution expenses 2,698 2,559 139 5
Interest credited to fixed accounts 831 856 (25) (3)
Benefits, claims, losses and settlement expenses 1,899 1,606 293 18
Amortization of deferred acquisition costs 286 397 (111) (28)
Interest and debt expense 276 317 (41) (13)
General and administrative expense 2,989 3,010 (21) (1)
Total expenses 8,979 8,745 234 3
Income from continuing operations before income tax provision 1,238 1,447 (209) (14)
Income tax provision 335 377 (42) (11)
Income from continuing operations 903 1,070 (167) (16)
Loss from discontinued operations, net of tax (2) (60) 58 97
Net income 901 1,010 (109) (11)
Less: Net loss attributable to noncontrolling interests (128) (106) (22) (21)
Net income attributable to Ameriprise Financial $ 1,029 $ 1,116 $ (87) (8)%
Overall
Income from continuing operations before income tax provision decreased $209 million, or 14%, compared to the prior
year primarily reflecting the market impact on variable annuity guaranteed benefits (net of hedges and the related DSIC
and DAC amortization) and the negative impact from spread compression in our interest sensitive product lines, partially
offset by the impact of market appreciation. The prior year results included $40 million of additional investment income
recognition (net of DAC and DSIC amortization) and a $27 million gain from an interest rate hedge. The market impact on
variable annuity guaranteed benefits (net of hedges and the related DSIC and DAC amortization) was a decrease to pretax
earnings of $265 million for the year ended December 31, 2012, which included a $14 million negative impact
associated with unlocking and model changes. This compares to a decrease of $62 million for the prior year, which
included a $4 million negative impact associated with unlocking and model changes. The negative impact on earnings from
spread compression in our interest sensitive product lines was approximately $90 million pretax for the year ended
December 31, 2012 compared to the prior year. The market impact on DAC and DSIC was a benefit of $31 million for the
year ended December 31, 2012 compared to an expense of $11 million for the prior year.
71