AMP To Cancel $2 Billion Insurance Sale Following New Zealand Action

AMP Ltd, an Australian wealth manager, recently proclaimed that it would possibly pull the $2.3 Billion sale of its life insurance section. The firm had to take this decision following the intervention from New Zealand’s central bank. This led to raising questions regarding the firm’s recovery plans and making its shares drop. Dumping the latest agreement would represent a setback for the firm that holds an existence of about 170 Years in the sector. AMP had earmarked this deal as a way to simplify functions after a host of scams at a public investigation last year.

AMP proclaimed that the purchaser, Britain’s Resolution Life, had informed it that RBNZ (Reserve Bank of New Zealand) compelled it to form separate financial assets. This move would guard policy owners in New Zealand. However, it might hurt both Resolution Life and AMP. In a statement, AMP proclaimed that the failure to meet this condition model is exceptionally disappointing because the sale of AMP Life is a basic element of AMP’s plan.

On a similar note, the Democratic majority leading the House Financial Services Committee recently circulated a plan for discussion. As per the copy of the draft legislation noticed by Reuters, this plan intends to prevent the huge technology firms from working as financial institutions or releasing digital currencies. Adding more to the Democratic majority’s proposal, and also as a result of the extensive demur caused due to Facebook’s digital coin Libra, violation of these kinds of rules will result in $1 million/day fine.

Such a sweeping plan might probably spark resistance from Republican members of the house who are enthusiastic about innovation. This plan would possibly struggle to collect sufficient votes to pass the lower chamber. Even if it is passed through the full house, still, it would have to pass the Senate. This would also probably be an uphill effort. However, the draft suggestion gives a strong message to big tech companies that are increasingly eyeing the economic services space.