Yesterday, AMP announced that its underlying profit, to which dividend levels are tied, fell 16% in the first half, due to a drop in the financial services and wealth management earnings.

First-half dividend was cut by Australia's largest superannuation provider to 14 a share (50 per cent franked), as against 22 a share (86 per cent franked) a year before.

The company said that its underlying profit sank to $367 million, while net profit shed 1 per cent to $362 million, which was a bit ahead of most analysts' expectations.

AMP clarified that there is a possibility that ongoing volatility will affect the market, as investor sentiment continued to be passive, despite the economic outlook looking promising.

Meanwhile, in order to improve its profitability, the company also mulls to scrap costs at AMP Financial Services by 5 per cent and keep group office costs flat.

The company also plans to pre-empt possible regulatory changes to investment fees by separating advice and product charges by June next year.

The company said that its underlying return on equity was 31.6 per cent, as against 40.5 per cent a year earlier.