By Rishav Chatterjee
(Reuters) - Shares in AMP (OTC:AMLTF) touched a more than two-month low on Wednesday, after the Australian wealth manager flagged lower growth expectations for the rest of the year and a fall in annual margins as high interest rates hurt earnings.
The 173-year old firm said it expected to record net interest margin below the prior guidance level of 1.30% to 1.35% for the full year ending December.
"We expect to see subdued growth for the remainder of the year."
"With higher rates expected to weigh on asset valuations and credit growth, it seems the cyclical headwinds are adding to the deeper strategic ones hurting AMP's business," said Kyle Rodda, senior market analyst at Capital.com.
AMP's platform net cashflows fell to A$426 million ($271.06 million) for the third quarter from A$748 million a year ago.
Net cashflows fell due to a continued drop in discretionary investments, as AMP's clients respond to the current macro-economic environment, CEO Alexis George said.
AMP shares fell to its lowest since Aug. 10 earlier in the session, dropping as much as 4.4% to A$1.085.
"We continue to actively manage the Bank portfolio in what remains a highly competitive environment, particularly as the Term Funding Facility (TFF) refinancing continues across the market," George added.
($1 = 1.5716 Australian dollars)