AMP is pausing the third part of its capital return program for two months after losing a Federal Court class action last month brought by AMP financial advisers.
The financial services company said on Thursday it had taken a $50 million provision in relation to the judgment, its best estimate of what the loss might cost it.
The financial advisers alleged that 2019 changes AMP made to its "buyer of last resort" program - under which the company would buy back their client books - drastically devalued their businesses.
The changes - which Federal Court judge Mark Moshinsky ruled were invalid - were made during a turbulent period as the financial services royal commission battered AMP's reputation.
CEO Alexis George said AMP hadn't decided whether it would appeal the Federal Court loss, but given the uncertainty around the judgment it would pause the third and final phase of its $1.1 billion capital return program.
"We just think it was the prudent thing to do, given we don't have a lot of clarity around these litigations," Ms George told analysts.
The program has already returned $750 million in surplus capital to shareholders through share buybacks and dividends following the sales of AMP Capital's infrastructure and real estate portfolios as it slims down to become a simpler company.
Ms George said that by year-end AMP would review the decision to pause the third tranche of the program, which had been expected to return up to $350 million to shareholders.
"We remain committed to returning excess capital to shareholders and will not be engaging in large-scale M&A activity in the near term," she said.
The current share buyback program will last until October, so Ms George said it simply amounts to a two-month pause.
The company also declared an interim dividend of 2.5 per cent per share, 20 per cent franked.
Overall AMP posted a first-half $112 million underlying net profit after tax, in line with the same period last year.
The profit of AMP Bank was up 23.9 per cent to $57 million, and the profit of its investment platforms business grew 25.7 per cent to $44 million.
Its advice business suffered a $25 million loss, a $5 million improvement over a year ago.
Ms George said AMP now had a portfolio it wanted to take into the future after restructuring and slimming down.
She said when legacy issues come up, AMP is working to resolve them methodically and rationally.
At 11.50am AEST, AMP shares were up 3.8 per cent to $1.14.
