Ameriprise 2014 Annual Report Download - page 66

the pretax impacts on our revenues and expenses attributable to unlocking and additional discussion of the drivers of the
unlocking impact.
In January 2013, we completed the conversion of our federal savings bank subsidiary, Ameriprise Bank, FSB, to a limited
powers national trust bank, which conversion included changing the name of this subsidiary to Ameriprise National Trust
Bank (references herein to ‘‘Ameriprise Bank’’ pertain to this same subsidiary whether before or after its conversion). In
connection with this conversion, deposit-taking and credit-originating activities of Ameriprise Bank were terminated. In
addition, Ameriprise Financial was deregistered by the Federal Reserve as a savings and loan holding company and is no
longer subject to supervision and regulation as such. We continue to make certain deposit and credit products available to
our clients via referral arrangements with respected third party financial institutions. The transition released approximately
$375 million of formerly required capital, which we used to repurchase shares of our common stock. The transition
reduced our annual earnings by approximately $49 million in 2013. At the enterprise level, the earnings per share impact
was neutralized by the end of 2013, as we redeployed the excess capital to shareholders through share repurchases.
We consolidate certain collateralized loan obligations (‘‘CLOs’’) and property funds (pooled investment vehicles) for which
we provide asset management services. These entities are defined as consolidated investment entities (‘‘CIEs’’). While the
consolidation of the CIEs impacts our balance sheet and income statement, our exposure to these entities is unchanged
and there is no impact to the underlying business results. For further information on CIEs, see Note 4 to our Consolidated
Financial Statements. Changes in the valuation of the CIE assets and liabilities impact pretax income. The net income
(loss) of the CIEs is reflected in net income (loss) attributable to noncontrolling interests. The results of operations of the
CIEs are reflected in the Corporate & Other segment. On a consolidated basis, the management fees we earn for the
services we provide to the CIEs and the related general and administrative expenses are eliminated and the changes in the
assets and liabilities related to the CIEs, primarily syndicated loans and debt, are reflected in net investment income. We
continue to include the fees from these entities in the management and financial advice fees line within our Asset
Management segment.
While our consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles
(‘‘GAAP’’), management believes that operating measures, which exclude net realized gains or losses; 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; integration and restructuring charges; income (loss) from discontinued operations; and the impact of
consolidating CIEs, best reflect the underlying performance of our core operations and facilitate a more meaningful trend
analysis. Management uses certain of these non-GAAP measures to evaluate our financial performance on a basis
comparable to that used by some securities analysts and investors. Also, certain of these non-GAAP measures are taken
into consideration, to varying degrees, for purposes of business planning and analysis and for certain compensation-related
matters. Throughout our Management’s Discussion and Analysis, these non-GAAP measures are referred to as operating
measures.
It is management’s priority to increase shareholder value over a multi-year horizon by achieving our on-average, over-time
financial targets.
Our financial targets are:
• Operating total net revenue growth of 6% to 8%,
• Operating earnings per diluted share growth of 12% to 15%, and
• Operating return on equity excluding accumulated other comprehensive income (‘‘AOCI’’) of 19% to 23%.
The following tables reconcile our GAAP measures to operating measures:
Years Ended
December 31,
2014 2013
(in millions)
Total net revenues $ 12,268 $ 11,199
Less: Revenue attributable to CIEs 651 345
Less: Net realized gains 37 7
Less: Market impact on indexed universal life benefits (11) (10)
Operating total net revenues $ 11,591 $ 10,857
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