Fund fees boost Macquarie annual profit


  • Business
  • Wednesday, 14 May 2003

SYDNEY: Australia’s Macquarie Bank Ltd reported a 33% jump in annual earnings and declared a special dividend yesterday as fees from specialist funds helped it outperform other investment banks and weak stock markets. 

Macquarie, which specialises in property and infrastructure funds, also said it expected continued revenue and earnings growth this year and remained focused on international expansion. 

The bank's move into infrastructure, toll road and property funds in recent years has helped protect it from a global downturn in investment banking that is hurting many of its global peers. 

For the year to end-March, Macquarie posted a net profit of A$333mil, versus A$250mil the prior year. And it announced a special dividend of 50 cents per share in addition to a 52-cent final dividend. 

Macquarie said its earnings were driven by its investment banking unit – holding its corporate finance, financial products and wholesale broking arms – after securing deals in Europe, Canada and Asia, but the performance of its investment in a majority-owned airport infrastructure fund was disappointing. 

In the United States, Merrill Lynch & Co, Lehman Brothers Holdings Inc, Goldman Group Inc and Morgan Stanley have all had to rely on strong bond trading income to offset tumbles in advisory and underwriting fees in the first quarter calendar 2003. 

Macquarie said it expected revenue and earnings to grow in 2004, but did not provide detailed forecasts. 

“We expect growth across most of our businesses, subject to market conditions not deteriorating materially,” managing director Allan Moss said in a statement. 

Macquarie earns most of its income from investment banking. It does not have a retail and business lending presence like Australia’s big four banks whose earnings growth has slowed to about 8% the past year. – Reuters  

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