AMP Limited’s [ASX:AMP] stock price dropped by 3.13% this morning, sitting at $3.56 at time of writing.
AMP provides superannuation and investment products, insurance, financial advice, and banking products — including home loans and savings accounts — in Australia and New Zealand.
But it hasn’t been a positive year for the financial services company, with steady decline and a major drop since May this year. AMP has fallen by nearly a third since the inquiry, a valuation loss of nearly two billion dollars.
Why the steep decline in share price?
AMP Limited is yet another financial giant that has fallen dramatically due to the Royal Banking Commission investigations. It’s lost its status as an ASX top 20 stock, and the five cases involving AMP that are currently underway could see settlement payouts and litigation fees in the millions.
They initially came under fire for their past practices of charging fees-for-no-service to their clients. Now with a magnifying glass placed over the company’s operations, they are currently nursing bigger losses due to poor corporate governance.
ASIC has been working with criminal prosecutors to investigate the issue further.
This is, undoubtably, more bad news for investors. These downward trends are unlikely to disappear before AMP is able to put the Royal Commission drama behind them.
Despite the bad news, it’ll be interesting to see if they can recover and rebuild.
Editor, Money Morning
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