The AMP Ltd (ASX: AMP) share price is rising on Thursday.
In morning trade, the financial services company's shares are up 9% to 92.5 cents.
Why is the AMP share price rising?
Investors have been bidding AMP's shares higher today after the company announced that it has reached an agreement to settle a class action.
According to the release, the company has agreed to settle the class action brought on behalf of certain advice practices authorised by AMP Financial Planning.
The proceedings challenged the validity of some of the changes made by AMP Financial Planning to its Buyer of Last Resort (BOLR) policy in 2019.
AMP revealed that the settlement is for a total of $100 million and is subject to the finalisation and execution of a deed of settlement and approval by the Federal Court. AMP has previously made a provision of $50 million for the class action.
The company also notes that the settlement covers the class action in its entirety, including where there has been no judgment.
AMP's chief executive, Alexis George, was pleased to put an end to this chapter. She said:
This is an important step forward for our Advice business and for AMP more broadly, as it allows us to put this legacy matter behind us, which has impacted relationships with our valued advisers. We've worked very hard in recent years on rebuilding the relationship with advisers and we're looking forward to working with them in the delivery of quality financial advice, at a time when Australians need it more than ever.