Ameriprise 2014 Annual Report Download - page 46

A downgrade in our credit ratings could also adversely impact our future cost and speed of borrowing and have
an adverse effect on our financial condition, results of operations and liquidity.
In view of the difficulties experienced in recent years by many financial institutions, including our competitors in the
insurance industry, the ratings organizations have heightened the level of scrutiny that they apply to such institutions and
have requested additional information from the companies that they rate. They may increase the frequency and scope of
their credit reviews, adjust upward the capital and other requirements employed in the ratings organizations’ models for
maintenance of ratings levels, or downgrade ratings applied to particular classes of securities or types of institutions.
Ratings organizations may also become subject to tighter laws, regulations or scrutiny governing ratings, which may in turn
impact ratings assigned to financial institutions.
We cannot predict what actions rating organizations may take, or what actions we may take in response to the actions of
rating organizations, which could adversely affect our business. As with other companies in the financial services industry,
our ratings could be changed at any time and without any notice by the ratings organizations.
Intense competition and the economics of changes in our product revenue mix and distribution channels could
negatively impact our ability to maintain or increase our market share and profitability.
Our businesses operate in intensely competitive industry segments. We compete based on a number of factors, including
name recognition, service, the quality of investment advice, investment performance, product offerings and features, price,
perceived financial strength, claims-paying ability and credit ratings. Our competitors include broker-dealers, banks, asset
managers, insurers and other financial institutions. Many of our businesses face competitors that have greater market
share, offer a broader range of products, have greater financial resources, or have higher claims-paying ability or credit
ratings than we do. Some of our competitors may possess or acquire intellectual property rights that could provide a
competitive advantage to them in certain markets or for certain products, which could make it difficult for us to introduce
new products and services. Some of our competitors’ proprietary products or technology could be similar to our own, and
this could result in disputes that could impact our financial condition or results of operations. In addition, over time certain
sectors of the financial services industry have become considerably more concentrated, as financial institutions involved in
a broad range of financial services have been acquired by or merged into other firms. This convergence could result in our
competitors gaining greater resources, and we may experience pressures on our pricing and market share as a result of
these factors and as some of our competitors seek to increase market share by reducing prices.
The offerings available to our advisor network include not only products issued by our RiverSource Life companies, but also
products issued by unaffiliated insurance companies. As a result of this and further openings of our advisor network to the
products of other companies, we could experience lower sales of our companies’ products, higher surrenders, or other
developments which might not be fully offset by higher distribution revenues or other benefits, possibly resulting in an
adverse effect on our results of operations. In addition, some of our products, such as certain products of our Property
Casualty companies, are made available through alliances with unaffiliated third parties. We could experience lower sales
or incur higher distribution costs or other developments which could have an adverse effect on our results of operations if
alliance relationships are discontinued or if the terms of our alliances change.
We face intense competition in attracting and retaining key talent.
Our continued success depends to a substantial degree on our ability to attract and retain qualified people. We are
dependent on our network of advisors for a significant portion of the sales of our mutual funds, annuities, face-amount
certificates and insurance products. In addition, the investment performance of our asset management products and
services and the retention of our products and services by our clients are dependent upon the strategies and decisioning of
our portfolio managers and analysts. The market for these financial advisors and portfolio managers is extremely
competitive, as are the markets for qualified and skilled executives and marketing, finance, legal, compliance and other
professionals. If we are unable to attract and retain qualified individuals or our recruiting and retention costs increase
significantly, our financial condition and results of operations could be materially adversely impacted.
The impairment or negative performance of other financial institutions could adversely affect us.
We have exposure to many different industries and counterparties, and we routinely execute transactions with
counterparties in the financial services industry, including broker-dealers, commercial banks, investment banks, hedge
funds, insurers, reinsurers, investment funds and other institutions. The operations of U.S. and global financial services
institutions are interconnected and a decline in the financial condition of one or more financial services institutions may
expose us to credit losses or defaults, limit our access to liquidity or otherwise disrupt the operations of our businesses.
While we regularly assess our exposure to different industries and counterparties, the performance and financial strength of
specific institutions are subject to rapid change, the timing and extent of which cannot be known.
Many transactions with and investments in the products and securities of other financial institutions expose us to credit
risk in the event of default of our counterparty. With respect to secured transactions, our credit risk may be exacerbated
when the collateral we hold cannot be realized upon or is liquidated at prices insufficient to recover the full amount of the
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