AMP boss Craig Meller is confident financial markets will bounce back from their latest plunge because the fundamentals of the global economy are strong.
The wealth management and insurance giant has so far weathered market volatility, lifting its annual profit by 10 per cent to $972 million, its best result in eight years.
AMP's Australian wealth management business, which provides financial advice and superannuation and investment services, drove the earnings growth.
Despite the recent woes on global markets, data suggests the Australian economy and other leading countries are actually doing quite well, Mr Meller said.
AMP, which manages almost $160 billion in investments, believes China's economy is adapting well to its economic shift from manufacturing to services.
News that makes sense
Your trusted source for staying up-to-date with the world around you. Get free daily news updates and analysis, straight to your inbox.
There is also good growth in the North American economy, and subdued European economies are progressing.
"So whilst there is a lot of volatility we think the underlying fundamentals are pretty strong and there's unlikely to be a global recession," Mr Meller told reporters on Thursday.
"The reality is that you see volatility in stock markets and that impacts investors returns over the short term but over the long term we are confident that markets recover."
Volatile markets did impact parts of AMP's business in the second half of 2015, but its banking and wealth protection businesses, plus the expansion of its investment management operations, were helping to offset that.
"Momentum continued across Australian wealth management and AMP Capital, which delivered a particularly strong result as our international investment management profile expands, both in China and more broadly," Mr Meller said.
Wealth management operating earnings rose 10 per cent to $410 million, aided by cost cuts and strong net cashflows and investment returns.
AMP's wealth protection business, which as been hit by costly insurance claims and policy lapses, took a two per cent fall in operating earnings, but the company said its work to improve the business was progressing.
The company also upgraded its dividend policy to target a payout of between 70 and 90 per cent of underlying profit, up from the 75 per cent payout for the second half of 2015.
AMP shares gained 25 cents, or 4.83 per cent, to $5.43.
AMP SHAKES OFF MARKET VOLATILITY
* Net profit up 10pct to $972m
* Revenues down 20pct to $14b
* Partly franked final dividend up 1.5 cents to 14 cents a share.
