AMP bullish on banking

AMP has provided a bullish assessment of the prospects for its banking division, forecasting growth above system in mortgage sales this year.

AMP Bank disclosures in the group's 2009 financial report, released yesterday, show that at the end of 2009 the bank's mortgage portfolio was $9.8 billion, a 2.1 per cent increase from $9.6 billion at the end of 2008.

In its report to investors AMP said: "The reduction in mortgage growth follows the closure of securitisation markets in 2009 and the intense competition for deposits, limiting available resources to fund higher mortgage growth."
 
The group is much more positive about its ability to access funds this year. It completed a $1 billion securitisation in January and expects to do more RMBS deals through the year.

The deposit book was $3.9 billion, up 14.7 per cent over the year. The bank sources its funds from retail and wholesale deposits as well as cash holdings in AMP superannuation funds. Thirty-four per cent of funding is off balance sheet.

The report said the bank would look to diversify its product range this year. Last year it launched AMP First, a high-yield online account designed to handle high transaction volumes.

The bank, which has more than 100,000 customers, contributed $35 million of AMP's operating earnings in 2009.