Loading AMP's first half loss was driven by a swingeing $2.35 billion impairment on AMP's financial planning arm. The impairment included a $1.5 billion writedown on the goodwill of AMP's wealth management business in the wake of last year's banking royal commission where it was accused of an array of misconduct. Chief executive Francesco De Ferrari said it was an "historic day" for the 170-year wealth manager. "We’re trying to re-set and draw a bright new future for the company... It is absolutely salvageable, I think AMP has a fantastic brand."

"These shocks and these crises have a short term impact, but as we re-position our business it is our firm commitment to win back the trust of our clients one interaction at a time. This is not going to happen immediately." AMP has set aside $778 million to fund the cost of compensating its customers. It has provisioned a further $1 billion to $1.3 billion to fund its future restructuring of its wealth arm. The group's operating profit for the half was $309 million, a 22 per cent decline on a year earlier. Australian wealth management operating earnings were down 49.5 per cent to $103 million. AMP will not pay an interim dividend. AMP continued to be impacted by large net outflows and during the half it recorded $3.1 billion in net outflows, nearly exactly the same amount it booked in the second half of 2018 on the back of the royal commission revelations. The wealth manager will use the cash to re-cut its deal to sell its insurance arm to UK/Bermudan group Resolution Life for $3 billion - far less than Resolution original $3.3 billion offer for the business. Under the new deal, AMP will receive $2.5 billion in cash and a $500 million equity interest in Resolution Life Australasia.

In the new deal, AMP will hold no interest in the mature business it is selling to Resolution Life. It was originally planning to retain a 40 per cent stake in the cash-producing mature business. Resolution Life executive chairman Clive Cowdery welcomed the re-cut deal, but said it was too soon to say if he would look to float Resoluton Life Australasia. "I'm delighted because it means that Resolution is now present in the Australian and New Zealand." "The market is just ready to open up for an in-force life insurance specialist - somebody who takes, as their core job, looking after existing life insurance business rather than being out there trying to sell new policies. " AMP copped more criticism on Thursday for its new deal with Resolution which it was forced to re-cut after the Reserve Bank of New Zealand refused to approve the deal over concerns local policyholders would not be paid out on their policies.

Mr De Ferrari said he was confident the deal would be approved by regulators. AMP had already already copped a flaming from its investors over deal with Resolution with many shareholders thinking AMP sold the business too cheaply to Resolution. "Clearly the terms of the recut deal are worse than the original terms and we were unhappy with the original terms," said Simon Mawhinney, managing director of Allan Gray which manages $10 million of AMP's shares. "We need to be quite pragmatic. We need to look at the company and say 'AMP going forward includes the sale of Life for $3 billion' and ask 'do we or don't we want to be associated with the company going forward?'." Macquarie analyst Brendan Carrig said the new deal with Resolution was reasonable given the metrics of the deal had moved around since it was announced in October.