How you doing? For those of you who don't know, I'm Nigel Dally, Morgan Stanley's life insurance analyst. Before we get started, please refer to the important disclosures which are available on our website. It's my pleasure this afternoon to introduce Jim Cracchiolo, Chairman and CEO, and Walter Berman. Jim is going to start with some introductory comments, and then we'll turn it to questions thereafter. Thank you, Jim. Across to you.
Hi, good afternoon, everyone. What I figured I would do is give you a little overview of Ameriprise, where we stand, how we're positioned, why we're excited, actually, based on being where we are about the opportunities ahead of us. We know that there are a lot of challenges, always with the market, industry changes, regulatory. I thought it would be a good opportunity to use this to sort of catch up a little bit. What I wanted to cover with you today is really to tell our story. We think there is an unbelievable continued opportunity for us in the businesses we're in. We think that we have a differentiated wealth management business and a global asset management business that has a lot of opportunity for further growth and scale.
We are moving our company to a dominant position in fee-based businesses, and we think that will help with multiple expansion for the total firm. We actually have both a strong capital position, but we have been one of the best returners based on our free cash flow that we think will continue. Most important when you invest in a company like ours, it's about people. We have to be, for us to continue to be successful, a highly trusted and respected firm, which I'll touch upon, but also be good and strong in our businesses and generate very good returns. We have a great foundation for us to go do that. When we talk about strength of a company, you talk about combination of culture, values, leadership, engagement. As an example, every year, we benchmark ourselves.
We do our employee surveys, engagement studies, both to our advisors and our employees. We're tops in the financial services industry in engagement. We're actually at point of arrival with the best firms in the U.S. With that's very important because this is a people-driven business. The leadership here, long tenures, good experience across the industry, and we are very clear in our values and commitments about community, our 100% corporate equality index, 11 consecutive years in a row. Best place to work, seven consecutive years. The opportunity in wealth management hasn't decreased. People need to accumulate more wealth for their retirement, which is their biggest need in life, and that asset, investable assets continue to grow. Most important, what I want to talk to you about is this opportunity and why we're situated well.
The segment that I'm focused on for my business is the $500-$5 million segment. It's the fastest growing wealth management segment. It controls 50% of investable assets. People say, "Well, is this just for baby boomers?" No. The answer is, this is for Generation X, this is for millennials. When you go speak to Generation X and millennials, and Generation X is a very large part of my base, they want the opportunity to work with financial advisors against all their goals and needs. If you go speak to millennials, there's always the question, well, they want to work with a robo. Millennials will actually say they want to be served by a person who will guide their financial future with a relationship supported by technology.
That's very important because millennials aren't fundamentally different than you and I as we've come up and as we've earned what we needed to and invested for the future. Very clearly, Ameriprise is situated very well to continue on our path. We're a leader in what we do. We have very strong productivity. We have one of the best networks. We are the leader in financial planning and advice, and we have a growing asset base and growing fee-based businesses. We serve people against the best interest standard today, and we will be able to serve them. DOL just come about, we're ready. Our advisors are operating fully, and we're fully compliant. When you look at the opportunity in wealth management, as I said, investable assets are growing. How do people want to be served? They want to be served through advice.
They want to be served by having a comprehensive relationship that gives them what they need against their goals, not about beating a benchmark or it's just investing to hit a benchmark. Very clearly, that's what we would call the consumer is looking for and the segment that we're focused on and concentrating in. You say, "Okay, why Ameriprise?" Well, we have unbelievable relations. This is what our clients are saying. As you look at industry reports that they go out and benchmark and speak to clients and prospects, we are one of the most trusted investment firms. In fact, the latest ratings just came out yesterday said that we're number two. The leader is only two points ahead of us on that scale, and that's Vanguard for just pure mutual funds. The other Temkin rating is on forgiveness.
We're number one by a large stretch of the imagination. Even those companies that are more direct are actually on the low end of that scale. We are the leader in forgiveness, meaning that if we made a mistake, our clients would forgive us. They only would do that if they feel they're being served well. We're a top performer in customer ratings based on unbiased and put interest first. What's the DOL standard all about? We're number one in the investment industry for Net Promoter, meaning that our clients would recommend us. When you look at that and you combination that with the idea of what clients and prospects are looking for for the future, that's why we feel we have a good opportunity to continue. Our Confident Retirement approach, this is against clients that have more than $1 million on average.
They're saying our Confident Retirement approach, 92% feel more confident about their retirement. 92% are committed to implement recommendations. 95% feel the advice addressed their needs. Again, whether it's the DOL, best standard and best interest, or against the opportunity in the marketplace, we are situated well with what the value proposition that we have that we offer. What does that lead to? It leads to stronger advisor engagement, stronger advisor productivity. Against the industry growth in client assets per advisor, we're up 56%, the average of the industry, it's 40%. If you look at growth in net revenue per advisor, up 40%, competitive firms up 19%. If I take, let's say, one of the largest independent firms, it's relatively flat over those years. As you can see, our productivity, and when we looked at us against other firms, we're actually in the top box.
We're number one in productivity growth year-over-year. It doesn't mean that we have the highest productivity of advisor against, let's say, a wirehouse, but on the growth every year compounded, we are the highest. How does that happen? We continue to invest in our brand, in marketing, in social media. We continue to invest in our advice value proposition. We're digitalizing everything. I know people talk about, there's robo and they want robo. What our clients want and what prospects want is a digitally enabled personal experience. That's what we've invested in, and that's what we do. Whether it's our advice value proposition, whether it's risk analyzing the client's portfolio, whether it's secured messaging and making sure that their documents of what they need for all of their purposes is fully online and secure, that's what we do. We invest in training.
We invest in helping advisors in the capabilities that they need to integrate their practices. We invest a lot in data security, in privacy to protect against cyber attacks. Those are things that advisors truly need and their clients want. From that, and we have an unbelievably strong compliance program. Those are the things that we feel really good that we're continuing to do to continue our growth. If you look at wealth management results, clients assets, $310 billion to $379 billion over this period with a doubling size of our fee-based wrap business. Operating net margins and revenue has grown from 11% net margin to 18%, one of the highest in the industry. Pre-tax operating earnings more than doubled. 80% of our revenue is recurring.
When you look at us, and this is a sample of some of our competitors, some of the independents ones that we can break out segment results for, you can see that we actually have this PTI margins, 18%, one of the highest. Revenue growth, one of the strongest without acquisition there. PTI growth compounded is the highest. You can look at it compared to some of the competitors that are public with higher PEs. Ray Jay, we have almost double margin. LPL, more than double the margin. Look at the growth that we have. Their 1% PTI growth over the last five years and our 17.5% compounded. Here again, we have an opportunity.
Some of these competitors, let's say, as an example, Ray Jay or some others, I could put Schwab, a lot of their growth has come from consumer lending, but it's not even consumer, that's commercial real estate lending. For us, we're a pure wealth manager, and the PEs of these other firms are much higher. We're not having pure wealth management if you just take it against the segment. Let me look at my I&A business. Again, 100% affiliated distribution, meaning we sell this as a solution against our planning clients. Less risk, less turnover. Second, with that, we hedge this completely. We have a strong requirements that it generates a good benefit, it generates a good shareholder return, and it could be truly risk managed and hedged. We're a top provider, but it's built over years and years.
We don't increase that book in a way that is aggressive in any fashion, and we maintain those relationships a long time. What does that mean? Well, when we do this and sell it as part of a deep relationship, and that's where the annuities or protections are sold, as part of planning relationships, we have five times higher client retention. We also have a variable annuity book that 39% doesn't even have a living benefit. Okay? When you look at this as a very high quality, very low risk at account value, living benefits and death benefits, very small. You can compare this against any book in the industry, you'll find that it is significantly different and significantly better. Asset management globally continues to increase even though there's this level of move to passive, so assets will be there to manage. Columbia Threadneedle is a global platform today.
We have almost a half a trillion dollars of assets. We have good position, top 15 mutual fund provider in the U.S., top five in the U.K. We have 111 four or five star funds. We're growing our institutional business, and we have good competitive margins. One of the things I always get asked is, "Jim, you're in major outflows. What does that mean to your business?" I try to explain to you that when you do acquisitions like Threadneedle from Zurich or Columbia from Bank of America, you have install bases. You want to maintain those bases. You want to continue to maintain good relations. You want to continue to generate revenue from which we have and renew those relationships. You're going to have a level of outflows because you've moved from a proprietary provider to a third-party provider to those houses.
If you look at it, when you go back to 2010, you can see that of our makeup at that time, $141 billion of assets were from these former parent relationships. Today, that's down to $70 billion. That means a lot of outflows every year that we get reported. Having said that, our third party retail and institution has grown from $316 billion to $384 billion during that time. We have good diversity of product on platforms. We have good performance in those products. We have a lot of new solutions that we've been bringing. We're going to report a level of outflows as that continues to equalize and adjust. That $70 billion is still now only worth today 8% of my revenue. Okay?
I might report $ billions of outflows every quarter from that, which will have a fee impact, but that's more than offset in some cases, based upon appreciation and other things. We're bringing in some assets from even these providers that might have a little higher fee, even though it's much less in flow. My point of reference is, as we're going through this, we've diversified and now have a much stronger diversified global base of assets, both retail and institution, through many more third parties. What does that look like for us? If I net out the ex-parent and you look at this compared to our competitors, right? As I said, the margin on that was not that high. Threadneedle fits right in there. Our margins are excellent compared to the industry on average.
Our flow rate is -2%, that's again, consistent with the industry, you can pick out individual competitors or the reason why, et cetera. My point of reference is we've been able to actually create a good, strong global asset manager. If you look at us over time, we've been able to make sure that we have good, strong pre-tax operating earnings, even going through this negative flow picture. Our margins have been able to maintain quite steady. We continue to aggressively re-engineer while we invest in new products, digitize as we put in new core platforms that will give us benefit for the future. Where do we see the growth opportunities? Broad-based capabilities, where we're managing volatility for clients, liability matching, balance sheet optimization. We're helping for tax efficiency, navigating rates, generating income. These are key investor goals that we have good solutions for.
We're growing our retail in the U.S. We've been able to gain market share over the last eight quarters within major providers in the U.S. In Europe and the U.K., Brexit is settling down a little bit. Not that you read that in the paper every day, flows are starting to come back where we always had a growing business there. Institutional, we are actually diversifying. We're expanding the strategies, we have an increasing demand for customization that we're going to be able to meet, we're moving to more global platforms. Single front-end, middle-end, and back-end offices so that we can operate globally more efficiently. These are some of the categories we're investing in. Solutions, adaptive risk, global strategic beta, responsible investing. You can see we have a good diversity between retail and growing institutional between North America, EMEA, and APAC.
Company overall, we're moving from where our capital intensive businesses were 50% of the business to now it's 66% in capital light, wealth management, asset management to, we think over the near term, greater than 75% in that category. What does that mean? We've been able to deliver good, strong financial and shareholder results. Revenue up compounded 3%, even in a very low interest rate environment. Operating earnings compounded 10% annual growth. Operating ROE going from 16% down to 11% to 22% today. One of the best ROE stories in the industry across any of those segments. What does that mean when you put it together? People always look at just the segment. I explained to you the benefit or how we're situated by segment, let me just tell you.
If you're investing in an asset manager, wouldn't you like to have some diversity based on any pressures or market where you have a strong growing wealth management or a premium fee-based of spread business? If you invest in an I&A, wouldn't you like to get the higher growth segment and a higher return business like wealth management? If you're investing in an I&A business, think about it. You want that. If you invest in an asset light business, you want some stability over time. You don't have to sacrifice anything. We have lower volatility and higher EPS growth in a diversified retail firm with very high ROEs. What does that do for you as a shareholder? Look at our returns to you. Dividend payout consistent with the industry across segments. Share buyback way ahead. Total return to you, 2011 to 2016, 129% of our earnings.
Strong capital return. This is our performance since we went public. I still believe significant opportunity, as I explained, and based on what I've just mentioned to you, significantly still undervalued. Let's take the comps of what other peers are trading. I'm not saying those PEs are correct or not correct based on the value of. I'm just saying if I take those PEs, I explained to you why my wealth management business is better than the industry. I don't even have commercial lending or anything in it. That's the PE those people trade at. That would give me a very high market cap for my advisory wealth alone. My asset management business, no worse than the industry of what they trade at.
My I&A business, I just explained to you based on what's at risk, the type of book, the consistency of that book, the return of that book. Again, I'll just take the multiples of the industry. Together, as I said, when you consolidate it actually comes out where I'm giving you a better consolidated return than any segment. Overall, I think we're well-positioned. I think we continue to invest for growth. I think we've been able to navigate, whether it's the market environment, the regulatory issues, but I think we have a very strong, good, stable company that will continue to generate good returns for the future. Thank you.
Great. Thank you. Perhaps if I start off the Q&A session. Obviously, the DOL remains an issue that a lot of people are focused on, and there seems to be a fair amount of debate as to what it really means for the advice business. Some people are saying that it's going to be hugely devastating, resulting in a substantial fee compression. Others are saying, "No, actually, nothing's really changed." I'd be interested in your perspective as to what it means for Ameriprise.
We were one of the strongest supporters of having a best interest standard across all assets and ways of servicing the client, not just in qualified. What we've just always positioned for is a principal base so that it's consistent and can operate that way, and appropriate so that you can make informed decisions on behalf of the client. As an example, with what the DOL has currently implemented on their best interest standard, we're very able, and ability to serve right now is underway fully. We don't see a negative impact from that. We've increased levels of due diligence. We've knocked some products off the shelf. We've eliminated 12b-1s.
For us, we need to continue to show the client we're generating any value based on the advice we give and how we're serving them, and we feel very good about that based on what I've just explained to you. I'm not saying there won't be some adjustment of fees over time. Since I've been in this industry for 35 years, there's always been some pressure on fees. Having said that, it's also the value that you are generating on behalf of the clients you're serving of whether they're willing to pay for those fees.
Second question would be just on the capital position. You've got a substantial amount of excess capital, and people are always looking at how you're going to put that to work, whether it's acquisitions or something else. As it relates to acquisitions, I'd be interested into just additional detail as to what's at the top of your priority list, and what the overall acquisition environment is like. Are there many available properties?
Well, as I look at the industry today, I do believe if you're talking about wealth management, as an example, I think there will be pressure on other providers. If they don't have the compliance infrastructure, if they can't support the new technology, if they feel like they are being pressured because the value's not there, I think there is opportunity for us to pick up smaller firms or even advisors that feel they need to be supported in a better and different way. I think that opportunity will be there and probably pick up a bit. I actually think in the asset management space, I think there is a level of consolidation that will need to occur. I think other people are feeling some pressure.
I think one of the things I would say about us is we've acquired, we've been able to integrate and gain scale and good diversity and margins in the way we operate. I don't think acquisitions in the future is just that you consolidate, everything continues to separate, and you can't get scale to offset the fee pressure or anything else that you're working on. I think those things will come about. For Ameriprise, I feel like there's opportunities to pick up things that would fit our solution set as we continue to build out globally. I think there may be opportunities, again, that for the right company, we'll be able to leverage some of their strengths in a more scale vantage way as we go through completion of our platforms and capabilities.
We here are very disciplined, and we look at it the operating side, we look at the culture, we look at the value. We think those things, opportunities will come along over the next periods.
Great. Let's pause here and see if there's any questions from the audience. Not yet. Let me Oh, here's one.
I think your internally estimated excess capital is $2 billion. Would you use all of that or return all of that in share repurchases or dividends, or would you need to maintain some cushion?
No. By definition, we talk about it's approximately $2 billion. By definition, we can use it. Obviously, it's a fact and circumstance situation if you want to use it for acquisition, clearly it's available for that use or buyback or dividend.
I'll hop in with another question. One of the areas that the personal auto, home and auto, you've called it non-strategic in the past, you wanted to improve the performance before looking at strategic alternatives for that. The performance has improved. Where do we stand now with that block of business?
Well, as we said towards the latter part of last year, we want to continue to progress that business back to the type of returns that we think are appropriate for what we had and what we used to do. I think we're on our way for that. For the first quarter and what we're seeing, continuing to see, our loss trends are improving. Our underwriting is tightened. We're better claim processing. We're better taking rate in various things. We de-risk some parts of the portfolio. We terminated certain affinity relationships that were giving us a little undue risk. We still have a good opportunity to grow with the ones we have, like Costco and Ameriprise and others. Really, I think we're on our way, we're in the first early innings for us to truly get this back to where we want.
We see good opportunity for further growth. As I said, I will evaluate as we continue to make that progression.
Just on the asset management side, you provided details that the legacy blocks have shrunk down for Ameriprise. Does that mean we're getting closer to potentially seeing positive net flows on the horizon, or the overall industry conditions just move towards passive so prevalent that it's going to be tough to get that back?
Well, what I would say is what we're seeing is our actual sales, gross sales, are actually holding reasonably well, that you have a bit more redemption occurring based on the move to passive as people are trying to sort out how's the construction as the redemptions are happening. I would just say, I can't predict when we or the industry will move into a net inflow. I think there are certain categories that are in inflows, certain categories will continue to grow for people like us. Overall, what I would just say is we're rounding out our portfolio with the right areas that we think will give us the opportunity in the future, in both domestic and internationally.
I can't sit here by quarter, I always will leave the ex-parent stuff as a net outflow, our focus is to get the third-party retail institutional to that inflow position. Again, it depends on the pressures, what moves to passive, what changes from a position of where people are investing. I think we're on a good path, I'm not going to predict a net inflow. What I would say is we have the opportunity to continue to grow in areas of opportunity, we continue to re-engineer to maintain our good margins and a reasonable investment approach.
Any other questions from the audience? Please. Got a mic coming for you.
What steps are you taking to create inflows? Is it targeting top quartile performance? What are the proactive steps you take for that?
Okay. We have a number of proactive steps. Let me give you a few of them. From a product or a solution set, we have a growing list of potential clients and clients moving into some of our solutions, like our Cara product, which is started from zero, is up to a few billion dollars already, $5 billion. We see an opportunity for other like those products we're launching in the U.K., in Europe, in the U.S. We see an opportunity continuing in our concentrated equity portfolios where we have very good performance. We see it in good credit as you see interest rates back up a bit. We see an opportunity in ESG areas that we're building on, like in the U.K. social bond fund, things like that. From a distribution perspective, we're gaining good on platforms in the large intermediaries here in the U.S.
We changed our organization. We hired good talented people. We're seeing more million-dollar producers. We're seeing multiple product producers. We're building our credibility on these various gatekeeping platforms as there's this location. We see it in institutional because now we got a lot more to sell than we ever did before. We've gained now, and now we're being considered by all the consultants globally, where we only had a very few of them previously. That does take time to build those relations, gain credibility. I feel like there's opportunity that we're seeing all along. At the same time, there is pressures coming from the other side that don't get you into an inflow immediately, but we're gaining traction. I would actually say I'm feeling good about the progress we're making.
I think the headwinds have picked up over the last two years, otherwise we would have seen more results.
Given that we're running short on time, maybe we better end it there. Thank you, Jim, and to Walter, for joining us today. Very much appreciate your insight. Thank you.