Ameriprise Financial Inc. said it plans to change the status of its banking unit by the end of this year so that the parent firm will no longer be regulated as a savings and loan holding company.
The transition will lead to a $20 million expense, most of it to be incurred this year, Minneapolis-based Ameriprise said today in a statement. The subsidiary will become a non-depository trust bank, subject to regulatory approval, the company said, and clients will have banking access through third-party providers.
Ameriprise, which provides financial planning and annuities, joins some of the largest U.S. insurers in distancing themselves from deposit-gathering operations as federal regulators increase oversight. MetLife Inc. is seeking to exit from banking and Hartford Financial Services Group Inc. and Allstate Corp. have also retreated from the business.
“Transitioning our federal savings bank subsidiary to a non-depository national trust bank will ensure we are regulated consistent with our capabilities, strategy and growth opportunity,” said Paul Johnson, a spokesman for the company, in an e-mailed statement.
A “small number” of jobs will be affected by the move, Johnson said without elaborating. Ameriprise slipped 16 cents to $50.23 at 4:01 p.m. in New York. The company is up about 1.2 percent this year.