[April 28, 2014]

Ameriprise Financial Reports First Quarter 2014 Results

Ameriprise Financial, Inc. (NYSE: AMP) today reported first quarter 2014 net income⁽¹⁾ of $401 million, or $2.01 per diluted share. Operating earnings were $407 million, up 20 percent from a year ago, with operating earnings per diluted share up 28 percent to $2.04.

Operating net revenues increased 8 percent to $2.8 billion, driven by strong fee-based business growth from client net inflows and increased client activity, as well as market appreciation, which more than offset pressure from continued low interest rates.

Operating expenses increased 6 percent to $2.3 billion reflecting increased volume-related distribution expense. General and administrative expenses remained flat compared to a year ago, reflecting the company's ongoing expense discipline.

In the quarter, segment pretax operating earnings from Advice & Wealth Management and Asset Management grew 36 percent to $364 million, continuing our earnings mix shift progression with these two businesses representing more than 60 percent of company earnings.⁽²⁾

In the quarter, the company returned $457 million to shareholders through share repurchases and dividends.

"Ameriprise delivered another strong quarter," said Jim Cracchiolo, chairman and chief executive officer. "Revenues and earnings were up nicely and our operating return on equity reached a new record of 20.8 percent."

"Our advisory and asset management businesses continue to drive our growth. Clients committed record flows to fee-based wrap programs and we're steadily driving improvement in advisor productivity.

"With our strong capital position and free cash flow, we returned more than $450 million to shareholders through share repurchases and dividends. And today, the board authorized an additional $2.5 billion share repurchase program and announced another increase of our regular quarterly dividend, raising it 12 percent."

⁽¹⁾ Net income represents net income from continuing operations attributable to Ameriprise Financial.

⁽²⁾ Excludes Corporate & Other segment.

Overall, results in the quarter were strong and included $5 million after tax, or $0.03 per diluted share, of favorable impacts from the market impact on DAC and DSIC. Other items are discussed in more detail in the segment commentary, including a favorable item in variable annuities that was offset by reserve strengthening and weather-related expenses for auto and home.

Taxes

The first quarter 2014 operating effective tax rate was 25.2 percent compared to 26.5 percent a year ago. The quarter included a $17 million benefit from the completion of tax audits from previous years. The company estimates that its full year 2014 operating effective tax rate will be in the 28 to 30 percent range.

First Quarter 2014 Business Highlights

• Total assets under management and administration grew 11 percent from a year ago to $783 billion driven by Ameriprise advisor client net inflows and market appreciation.
• Ameriprise advisor client assets grew 12 percent to a record $418 billion and total wrap assets increased 19 percent to $159 billion. Wrap net inflows in the quarter were a record $4.2 billion.
• Advisor productivity continues to improve. On a trailing 12-month basis, operating net revenue per advisor, excluding results from former banking operations, grew 15 percent to $454,000.
• Experienced advisor recruiting remained solid, with 76 experienced advisors moving their practices to Ameriprise during the quarter and the recruiting pipeline remains good.
• Asset Management segment AUM increased 8 percent to $504 billion, driven by market appreciation, partially offset by $3.9 billion of net outflows in the quarter.
• In April, Threadneedle was awarded a $5.5 billion mandate that is expected to fund in the second quarter.
• The company has 113 four- and five-star rated funds, with 51 funds managed by Columbia Management and 62 managed by Threadneedle.
• Strong sales of indexed universal life products drove a 22 percent increase in VUL/UL cash sales.
• The company increased its regular quarterly dividend 12 percent to $0.58 per diluted share payable on May 23, 2014 to shareholders of record as of May 9, 2014. The company also announced an additional $2.5 billion share repurchase authorization.
• Excess capital was approximately $2 billion after repurchasing 3.2 million shares of common stock in the quarter for $354 million and paying $103 million in quarterly dividends. The company also currently holds $500 million of capital for contingencies that is above required levels, primarily for variable annuity products.

Segment Summaries

Advice & Wealth Management pretax operating earnings increased 39 percent to $181 million, reflecting robust revenue growth and expense controls. First quarter 2014 pretax operating margin was 15.8 percent compared to 12.8 percent a year ago.

Operating net revenues grew 13 percent to $1.1 billion driven by asset growth in fee-based accounts from client inflows and improved client activity, as well as market appreciation.

Operating expenses increased 9 percent to $968 million as business growth resulted in higher distribution expenses. General and administrative expenses declined 1 percent, demonstrating ongoing expense discipline.

Total retail client assets grew 12 percent to $418 billion driven by client net inflows, client acquisition and market appreciation. Wrap net inflows increased 3 percent to a record $4.2 billion, and brokerage cash balances were $19.3 billion. The combination of asset growth and strong client activity drove a 15 percent increase in operating net revenue per advisor, excluding former banking operations, on a trailing 12-month basis.

Asset Management pretax operating earnings increased 33 percent to $183 million driven by equity market appreciation and continued expense management, partially offset by the cumulative impact of net outflows.

Asset Management margins continue to be strong. In the first quarter, adjusted net pretax operating margin was 39.0 percent compared to 33.2 percent a year ago.

Operating net revenues grew 8 percent to $807 million, primarily driven by asset growth from market appreciation, as well as a shift to higher-fee, retail assets at Threadneedle, partially offset by the impact of net outflows.

Operating expenses increased 3 percent to $624 million, reflecting higher distribution expenses from market growth. Overall, expenses remained well controlled, with general and administrative expenses remaining flat.

Assets under management grew 8 percent to $504 billion, reflecting market appreciation, partially offset by net outflows. Retail net outflows of $3.4 billion in the quarter were driven by outflows at Columbia and a portfolio manager change at Threadneedle, partially offset by strong underlying retail net inflows at Threadneedle. Institutional flows reflected good traction in third-party mandates that offset continued outflows from legacy insurance mandates and former parent company affiliated distribution.

Annuities pretax operating earnings in the quarter increased 24 percent to $176 million compared to $142 million a year ago, reflecting new business growth, beneficial client behavior and market appreciation, partially offset by fixed annuity spread compression.

Variable annuity operating earnings increased 38 percent to $145 million. Equity market appreciation and beneficial client behavior more than offset higher distribution expenses from business growth and market appreciation. Managed volatility fund options introduced last year continue to be well received, with existing policyholders moving $1.8 billion of assets into the funds in the quarter. The new investment options enhance the overall product risk profile, and as a result, earnings included a $29 million benefit from this activity.

Fixed annuity operating earnings declined 16 percent to $31 million, which was in line with management expectations.

Variable annuity account balances grew 7 percent to $75.9 billion. Asset growth was driven by market appreciation, partially offset by net outflows primarily from a closed block of variable annuities sold through third-party channels. Variable annuity cash sales remained solid at $1.2 billion. Fixed annuity account balances declined 5 percent to $12.9 billion.

Protection pretax operating earnings were $59 million. Net revenues grew 3 percent, primarily from growth in Auto and Home.

Life and Health earnings were stable and reflect continued claims experience that was within expectations. VUL/UL account balances grew 8 percent, driven by market appreciation and a 22 percent increase in cash sales reflecting strong sales of indexed universal life products.

Consistent with industry experience, first quarter Auto and Home earnings were negatively impacted by approximately $20 million of weather-related losses from severe winter weather. Auto and Home also increased auto liability reserves by $30 million in the quarter based upon additional analysis and information regarding continued adverse development of bodily injury claims associated with accident years 2011 and 2012. To date, the 2013 accident year has continued to have better experience than 2011 and 2012.

Corporate & Other pretax operating loss was $55 million for the quarter compared to a $53 million loss a year ago.

At Ameriprise Financial, we have been helping people feel confident about their financial future for 120 years. With a nationwide network of 10,000 financial advisors and extensive asset management, advisory and insurance capabilities, we have the strength and expertise to serve the full range of individual and institutional investors' financial needs. For more information, visit ameriprise.com.

Ameriprise Financial Services, Inc. offers financial planning services, investments, insurance and annuity products. Columbia Funds are distributed by Columbia Management Investment Distributors, Inc., member FINRA and managed by Columbia Management Investment Advisers, LLC. Threadneedle International Limited is an SEC- and FCA-registered investment adviser affiliate of Columbia Management Investment Advisers, LLC based in the U.K. Auto and home insurance is underwritten by IDS Property Casualty Insurance Company, or in certain states, Ameriprise Insurance Company, both in De Pere, WI. RiverSource insurance and annuity products are issued by RiverSource Life Insurance Company, and in New York only by RiverSource Life Insurance Co. of New York, Albany, New York. Only RiverSource Life Insurance Co. of New York is authorized to sell insurance and annuity products in the state of New York. These companies are all part of Ameriprise Financial, Inc. CA License #0684538. RiverSource Distributors, Inc. (Distributor), Member FINRA.

Forward-Looking Statements

This news release contains forward-looking statements that reflect management's plans, estimates and beliefs. Actual results could differ materially from those described in these forward-looking statements. Examples of such forward-looking statements include:

• the statement in this news release that the company expects its full-year 2014 operating effective tax rate to be in the 28 to 30 percent range;
• the statement in this news release that a $5.5 billion mandate awarded to Threadneedle is expected to fund in the second quarter;
• statements of the company's plans, intentions, positioning, expectations, objectives or goals, including those relating to asset flows, mass affluent and affluent client acquisition strategy, client retention and growth of our client base, financial advisor productivity, retention, recruiting and enrollments, the introduction, cessation, terms or pricing of new or existing products and services, acquisition integration, general and administrative costs, consolidated tax rate, return of capital to shareholders, and excess capital position and financial flexibility to capture additional growth opportunities;
• other statements about future economic performance, the performance of equity markets and interest rate variations and the economic performance of the United States and of global markets; and
• statements of assumptions underlying such statements.

The words "believe," "expect," "anticipate," "optimistic," "intend," "plan," "aim," "will," "may," "should," "could," "would," "likely," "forecast," "on pace," "project" and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from such statements.

Such factors include, but are not limited to:

• conditions in the interest rate, credit default, equity market and foreign exchange environments, including changes in valuations, liquidity and volatility;
• changes in and the adoption of relevant accounting standards and securities rating agency standards and processes, as well as changes in the litigation and regulatory environment, including ongoing legal proceedings and regulatory actions, the frequency and extent of legal claims threatened or initiated by clients, other persons and regulators, and developments in regulation and legislation, including the rules and regulations implemented or to be implemented in connection with the Dodd-Frank Wall Street Reform and Consumer Protection Act;
• investment management performance and distribution partner and consumer acceptance of the company's products;
• effects of competition in the financial services industry, including pricing pressure, the introduction of new products and services and changes in product distribution mix and distribution channels;
• changes to the company's reputation that may arise from employee or advisor misconduct, legal or regulatory actions, perceptions of the financial services industry generally, improper management of conflicts of interest or otherwise;
• the company's capital structure, including indebtedness, limitations on subsidiaries to pay dividends, and the extent, manner, terms and timing of any share or debt repurchases management may effect as well as the opinions of rating agencies and other analysts and the reactions of market participants or the company's regulators, advisors, distribution partners or customers in response to any change or prospect of change in any such opinion;
• changes to the availability and cost of liquidity and the Company's credit capacity that may arise due to shifts in market conditions, the Company's credit ratings and the overall availability of credit;
• risks of default, capacity constraint or repricing by issuers or guarantors of investments the company owns or by counterparties to hedge, derivative, insurance or reinsurance arrangements or by manufacturers of products the company distributes, experience deviations from the company's assumptions regarding such risks, the evaluations or the prospect of changes in evaluations of any such third parties published by rating agencies or other analysts, and the reactions of other market participants or the company's regulators, advisors, distribution partners or customers in response to any such evaluation or prospect of changes in evaluation;
• experience deviations from the company's assumptions regarding morbidity, mortality and persistency in certain annuity and insurance products, or from assumptions regarding market returns assumed in valuing or unlocking DAC and DSIC or market volatility underlying our valuation and hedging of guaranteed living benefit annuity riders, or from assumptions regarding anticipated claims and losses relating to our automobile and home insurance products;
• changes in capital requirements that may be indicated, required or advised by regulators or rating agencies;
• the impacts of the company's efforts to improve distribution economics and to grow third-party distribution of its products;
• the ability to pursue and complete strategic transactions and initiatives, including acquisitions, divestitures, restructurings, joint ventures and the development of new products and services;
• the ability to realize the financial, operating and business fundamental benefits of strategic transactions and initiatives the company has completed, is pursuing or may pursue in the future, which may be impacted by the ability to obtain regulatory approvals, the ability to effectively manage related expenses and by market, business partner and consumer reactions to such strategic transactions and initiatives;
• the ability and timing to realize savings and other benefits from re-engineering and tax planning;
• interruptions or other failures in our communications, technology and other operating systems, including errors or failures caused by third party service providers, interference or failures caused by third party attacks on our systems, or the failure to safeguard the privacy or confidentiality of sensitive information and data on such systems; and
• general economic and political factors, including consumer confidence in the economy and the financial industry, the ability and inclination of consumers generally to invest as well as their ability and inclination to invest in financial instruments and products other than cash and cash equivalents, the costs of products and services the company consumes in the conduct of its business, and applicable legislation and regulation and changes therein, including tax laws, tax treaties, fiscal and central government treasury policy, and policies regarding the financial services industry and publicly held firms, and regulatory rulings and pronouncements.

Management cautions the reader that the foregoing list of factors is not exhaustive. There may also be other risks that management is unable to predict at this time that may cause actual results to differ materially from those in forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. Management undertakes no obligation to update publicly or revise any forward-looking statements. The foregoing list of factors should be read in conjunction with the "Risk Factors" discussion under Part 1, Item 1A of and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2013 available at ir.ameriprise.com.

The financial results discussed in this news release represent past performance only, which may not be used to predict or project future results. The financial results and values presented in this news release and the below-referenced Statistical Supplement are based upon asset valuations that represent estimates as of the date of this news release and may be revised in the company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2014. For information about Ameriprise Financial entities, please refer to the First Quarter 2014 Statistical Supplement available at ir.ameriprise.com and the tables that follow in this news release.

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