The ratings also consider Ameriprise’s broad multi-platform network of financial advisors, its leading market position and well developed enterprise risk management program. A.M. Best notes that the number of the company’s financial advisors has increased over the most recent period after declining in prior years as it had been focused on recruiting experienced advisors while culling less productive advisors.While life and annuity sales rebounded somewhat in 2011, statutory premiums from Ameriprise’s annuity and life and health segments generally have declined over the past five-year period and remains well below levels prior to the financial crisis. This is primarily due to a substantial decline in variable annuity and variable universal life sales following the financial crisis. Sales of variable annuities have been impacted more recently due to the organization’s decision to cease marketing through third-party distribution channels and the transition to a new volatility managed annuity product in 2012. However, the company’s product mix has become more balanced as ordinary life insurance sales have increased over the past year. A.M. Best notes that Ameriprise’s earnings are highly correlated to movements in interest rates and equity markets. As a result, earnings may be materially impacted going forward should the low interest rate environment persist as a significant portion of the crediting rates on Ameriprise’s fixed annuity business are at or near their guaranteed minimums. Furthermore, Ameriprise may continue to experience net outflows in its annuity and asset management businesses due to the ongoing volatility in the financial markets. IDS and Ameriprise Insurance Company’s ratings are based on their consolidated operating results and the financial positions of both companies and reflect their synergies with Ameriprise. In addition, the ratings take into account the companies’ solid risk-adjusted capital position and positive operating results despite two years of above plan weather-related catastrophes. A.M. Best believes Ameriprise and its subsidiaries are well positioned at their current ratings.
Negative rating actions could result from a material decline in RiverSource Life Insurance Company’s risk-adjusted capital due to stockholder dividends and/or deteriorating operating results due to spread compression or a significant decline in assets management fees.The following debt ratings have been affirmed: Ameriprise Financial, Inc.—-- “a-” on $700 million 5.65% senior unsecured notes, due 2015-- “a-” on $300 million 7.30% senior unsecured notes, due 2019-- “a-” on $750 million 5.35% senior unsecured notes, due 2020-- “a-” on $200 million 7.75% senior unsecured notes, due 2039-- “bbb” on $294 million 7.518% junior subordinated notes, due 2066 The following indicative shelf ratings have been affirmed: Ameriprise Financial, Inc.—-- “a-” on senior unsecured debt-- “bbb+” on subordinated debt-- “bbb” on preferred stock Ameriprise Capital Trust I, II, III and IV—-- “bbb” on trust preferred securities The methodology used in determining these ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best’s rating process and contains the different rating criteria employed in the rating process. Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology. Founded in 1899, A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com. Copyright © 2012 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.