AMP said it would reinsure its wealth protection business in New Zealand with Swiss Re, a deal that will release up to $150 million in capital for the group, and was looking to sell its wealth management and financial advice businesses in New Zealand. AMP, which also revealed higher outflows from its funds management business in the latest quarter, argued the deals would simplify the business and allow it to focus on growth. Loading But investors slammed the stock to a new record low of $2.50. The plunge came as the ASX200 suffered heavy falls, losing 2.9 per cent. The life insurance sale comes after a turbulent year for AMP, whose share price has plunged 54 per cent from its 2018 peak in March. Since revelations of misconduct in its advice arm at the royal commission, it has lost its former chair, Catherine Brenner, with Mike Wilkins stepping up as acting CEO after the early departure of former chief Craig Meller. Future CEO Francesco De Ferrari will take over from Mr Wilkins in December.

Hugh Dive, chief investment officer at Atlas Funds Management, said the sale price, at 0.82 times its book value, was "at the low end" compared with life insurance sales by banks recently. AMP's share price drop had probably been driven by the complexity of the deal, fears that fund outflows would accelerate from here, and the prospect of dividend cuts, he said. "I think really the market is most concerned about confirmation that there's outflows, and what that does to margins," Mr Dive said. Managing director of White Funds Management, Angus Gluskie, said the sale price appeared to be about 20 per cent below the market's expectation. "It is worth recognising that the stock had already fallen by 20 per cent over the prior six months on the back of expectations around both outflows and restructuring needs. It is worth questioning whether today’s falls contain an overlap on what had already occurred," said Mr Gluskie, who is invested in AMP. Mr Wilkins said the life sale would help to make AMP a "simpler, more focused group" that could focus on its growth areas of funds management, superannuation and banking.

“This is historic - AMP has had a life insurance underwriting exposure for 169 years, and we’re saying going forward we’re not going to have that,” Mr Wilkins said in an interview with Fairfax Media. “However, we are continuing to help our customers provide for their futures, and that won’t change, and we will still be able to offer protection to them, it just won’t be underwritten by AMP anymore.” Morningstar analyst Chanaka Gunasekera said the market had probably been spooked by the prospect of dividend cuts and cash outflows, which are a sign of how the damage to AMP's reputation is hitting its bottom line. Loading Replay Replay video Play video Play video "The real question is can they regain some of that reputational damage?" Mr Gunasekera said.