Macquarie Group Limited




Introduction
June 2010
Disclaimer

Disclaimer
The material in this presentation has been prepared by Macquarie Group Limited ABN 94 122 169 279 (...
Introduction
to Macquarie
About Macquarie

     Global provider of banking, financial, advisory,                                                    ...
Diversified by region
                                                                                                    ...
Diversified by region
                                                                                                 Ope...
Diversified by business
                                                                                                  ...
Diversified income
                                                                                                       ...
Financial performance
                                                                                                    ...
Funded balance sheet remains strong

                                                                                 Macq...
Consistently strong capital base

      Well capitalised – surplus over Group’s minimum regulatory capital requirement of ...
Assets under management of €221billion¹

      Significant increase in AUM due to Delaware acquisition in Jan 10
         ...
Macquarie’s
Operating Businesses
Macquarie’s Operating Businesses
                                                                                         ...
Macquarie’s Operating Businesses
                                                                                         ...
Macquarie’s Operating Businesses
                                                                                         ...
Macquarie
in EMEA
Macquarie in EMEA

Key information
     Regional headquarters – London
     16 office locations in 10 countries
     Activ...
Macquarie in EMEA


Capital markets, advisory and securities                     Asset and Wealth Management
Corporate fin...
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Remo Nogarotto - Talking Continents 09/07/2010

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Remo Nogarotto - Talking Continents 09/07/2010

  1. 1. Macquarie Group Limited Introduction June 2010
  2. 2. Disclaimer Disclaimer The material in this presentation has been prepared by Macquarie Group Limited ABN 94 122 169 279 (“Macquarie”) and is general background information about Macquarie’s activities current as at the date of this presentation. This information is given in summary form and does not purport to be complete. Information in this presentation, including forecast financial information, should not be considered as advice or a recommendation to investors or potential investors in relation to holding, purchasing or selling securities or other financial products or instruments and does not take into account your particular investment objectives, financial situation or needs. Before acting on any information you should consider the appropriateness of the information having regard to these matters, any relevant offer document and in particular, you should seek independent financial advice. All securities and financial product or instrument transactions involve risks, which include (among others) the risk of adverse or unanticipated market, financial or political developments and, in international transactions, currency risk. This presentation may contain forward looking statements including statements regarding our intent, belief or current expectations with respect to Macquarie’s businesses and operations, market conditions, results of operation and financial condition, capital adequacy, specific provisions and risk management practices. Readers are cautioned not to place undue reliance on these forward looking statements. Macquarie does not undertake any obligation to publicly release the result of any revisions to these forward looking statements to reflect events or circumstances after the date hereof to reflect the occurrence of unanticipated events. While due care has been used in the preparation of forecast information, actual results may vary in a materially positive or negative manner. Forecasts and hypothetical examples are subject to uncertainty and contingencies outside Macquarie’s control. Past performance is not a reliable indication of future performance. 2
  3. 3. Introduction to Macquarie
  4. 4. About Macquarie Global provider of banking, financial, advisory, Recent Growth Profile investment and funds management services 1969 Established as Hill Samuel Australia Limited, a wholly-owned subsidiary of UK merchant bank Hill Samuel & Co Ltd Founded in 1969, currently operates in more 1985 Obtained an Australian banking licence as Macquarie Bank Limited than 70 office locations in 28 countries and 1989 London office opened employs over 14,600 people 1994 New York office opened 1995 Hong Kong office opened Listed on Australian Securities Exchange (ASX: 1996 Macquarie Bank Limited publicly listed on the Australian Stock Exchange MQG; ADR: MQBKY) ------------------------------------------------------------------------------- 2004 Acquired Asian cash equities business of ING Group (Asia) Regulated by APRA, Australian banking 2005 Acquired Cook Inlet Energy Supply (US) regulator, as non-operating holding company of 2007 Acquired Giuliani Capital Advisors LL (US) a licensed Australian bank Formally established Macquarie Group Limited as a Non-Operating Holding company 2008 Established a UK bank on 4 February Market capitalisation of €15.25bn as at 4 June Acquired Orion Financial Inc. (Canada) 2010 Acquired CIT Systems Leasing (US) 2009 Acquired Constellation Energy’s downstream natural gas trading operations (North Assets under management €221bn1 America) 2010 Acquired Tristone Capital Global Inc.(Canada, US, UK, Argentina) Acquired Delaware Investments (US) Acquired Fox-Pitt Kelton Cochran Caronia Waller (North America and Europe) Acquired Blackmont Capital (Canada) Acquired equity derivatives & structured products and cash equities sales and research business of Sal. Oppenheim (Europe) Acquired 120,00-vehicle auto finance portfolios as Ford Credit & GMAC exit Australia Agreed to acquire a portfolio of 47 aircraft from ILFC/AIG 1. As at 31 March 2010. EUR amounts have been converted solely for the convenience of the reader at the 31 March 2010 exchange rate: AUD =EUR0.6791 4
  5. 5. Diversified by region Major International Operations EUROPE, MIDDLE EAST ASIA AMERICAS & AFRICA3 Income: €586m (13% of total) Income: €774m (18% of total) Income: €916m (21% of total) Staff: 1,473 Staff: 2,410 Staff: 3,478 Beijing Seoul Tokyo Shanghai Calgary Taipei Vancouver Hong Kong Hsinchu Seattle Toronto Dublin Stockholm Gurgaon Manila San Francisco Bloomfield Hills Montreal London Amsterdam San Jose Chicago Boston Bristol Frankfurt Bangkok Irvine Hartford Paris Moscow4 Los Angeles Denver Vienna Mumbai Carlsbad San Diego New York Zurich Luxembourg Atlanta Philadelphia Geneva Munich Kuala Lumpur Dallas Singapore Austin HoustonJacksonville Miami Jakarta Mexico Dubai Abu Dhabi Sunshine Coast Gold Coast Brisbane Perth Adelaide Newcastle Sydney Melbourne Canberra Auckland Wellington Christchurch Riberao Preto Sao Paulo Buenos Aires Johannesburg3 Cape Town AUSTRALIA Income: €2,104m (48% of total) Staff: 7,296 1. Income for full year to 31 Mar 10. Income in each region excludes earnings on capital and other corporate items. 2. Staff numbers at 31 Mar 10. 3. Excludes staff in Macquarie First South joint venture. 4. Staff seconded to joint venture not included in official headcount (Moscow: Macquarie Renaissance, Savannah: Medallist). 5
  6. 6. Diversified by region Operating Income by Region 1,800 1,600 1,400 1,200 2H08 Operating income $Am1 1H09 2H09 1,000 1H10 2H10 800 600 400 200 0 Australia Asia Americas Europe, Middle East & Africa 1. Operating income excludes earnings on capital and other corporate items. 6
  7. 7. Diversified by business Major business activities Macquarie Macquarie Macquarie Fixed Income, Corporate Banking and Securities Capital Funds Currencies and and Asset Financial Group Group Commodities Finance Services Group Institutional cash Mergers and Offers a range of Trading, sales, research Leasing and asset Tailored cash solutions: equities and equity acquisitions, takeovers investments across a and finance covering: finance CMA, term deposits, capital markets and corporate variety of asset classes, Cash XL services through joint restructuring advice including: - Fixed income – Tailored debt and venture with Macquarie interest rate, debt finance solutions for Advice: Premium Capital Advisers Equity capital markets, - Equities and credit clients Portfolio service, wealth equity and debt capital securities mgt, private bank, Derivatives DeltaOne management and - Listed Asset remarketing, private portfolio mgt, Trading: raising infrastructure - Currencies – sourcing and trading full service stockbroking foreign exchange - Institutional/ Alternative asset funds - Listed real estate spot, forward and Intermediary: Macquarie retail derivatives management, tailored services Wrap, Coin Financial including infrastructure - Currencies Planning software, - Structured and real estate funds - Commodities – mortgages, life equity finance - Fixed income metals, energy, insurance Debt structuring, environmental - Arbitrage trading distribution and debt - Cash products, Direct services: capital markets agriculture, freight, Macquarie Edge online - Synthetic - Commodities bulk commodities trading and credit cards products and - Private equity complementary Relationship banking - Global securities and hedge fund futures services services finance of funds Funds management - Structured and administration products 7
  8. 8. Diversified income Operating income by source Operating income before writedowns, impairments, equity accounted gains/(losses) and one-off items Institutional and retail cash equities Equity derivatives 12 months to 31 Mar 09 12 months to 31 Mar 10 €4.9b €4.8b Macquarie-managed funds (includes base and performance fees, M&A advisory and underwriting and asset sales) 9% 15% 18% Securities funds management 20% 17% 16% 22% and administration 6% Third party M&A and advisory 12% 8% income 13% 16% Asset and equity investments 14% 28% 12% 10% Commodities, resources 15% and foreign exchange 13% 8% 7% 8% 9% 10% 7% 7% 9% Lending, leasing and margin 10% related income As at 31 March 2010. EUR amounts have been converted solely for the convenience of the reader at the 31 March 2010 exchange rate: AUD = EUR0.6791. 8
  9. 9. Financial performance Full year ended 31 March 2010 EURm FY10 operating income of €4,508m EURm FY10 profit of €713m 2,500 20% increase on FY09 500 21% increase on FY09 2,000 400 1,500 300 1,000 200 500 100 0 0 2H08 1H09 2H09 1H10 2H10 2H08 1H09 2H09 1H10 2H10 EUR FY10 dividends per share of €1.26 EUR FY10 earnings per share of €2.17 1.5 2.0 3% decrease on FY09 1% increase on FY09 1.5 1.0 1.0 0.5 0.5 0.0 0.0 2H08 1H09 2H09 1H10 2H10 2H08 1H09 2H09 1H10 2H10 As at 31 March 2010. EUR amounts have been converted solely for the convenience of the reader at the 31 March 2010 exchange rate: AUD = EUR0.6791. 9
  10. 10. Funded balance sheet remains strong Macquarie Group Limited $Ab 30 September 2009 $Ab 31 March 2010 $Ab 31 March 2010 Pro -forma1 90 90 90 Impact of CMT/CMA initiative ST wholesale 80 issued paper (6%) 6.5x 80 80 excess Other debt 2 maturing in the next 12 ST wholesale 4.5x mths (8%) 70 issued paper (7%) excess 70 ST wholesale 70 Cash and liquid issued paper (6%) Other debt 2 6.0x maturing in the next 12 assets (37%) Other debt maturing in the next 12 2 excess mths (9%) Cash and liquid mths (8%) assets (30%) 60 Deposits 60 Cash and liquid 60 (34%) assets (37%) Deposits Deposits (26%) (24%) 50 50 Trading assets 50 (17%) Trading assets (15%) Trading assets 40 40 (13%) Loan assets 40 Loan assets < 1 year (10%) < 1 year (9%) Debt maturing Loan assets beyond < 1 year (8%) 30 12 mths (35%) 30 Debt maturing 30 Debt maturing beyond > 1 year Loan assets beyond 12 mths (40%) (26%) > 1 year Loan assets 12 mths (44%) Loan assets (30%) > 1 year 20 > 1 year 20 20 (27%) (27%) Loan capital 10 10 10 Debt investment securities Equity (16%) Equity Equity (14%) Equity Equity (16%) Equity investments 3 investments 3 investments 3 (7%) (7%) (8%) 0 PPE 0 0 Funding sources Funded assets Funding sources Funded assets Funding sources Funded assets Note: These charts represent Macquarie Group Limited’s funded balance sheets at the respective dates noted above. 1. Adjusted to reflect CMT volumes at 31 March 2010. 2. Includes Structured Notes, Secured Funding, Bonds, Other Bank Loans maturing within the next 12 mths and Net Trade Creditors. 3. This represents the Group’s co-investment in Macquarie-managed funds and equity investments 10
  11. 11. Consistently strong capital base Well capitalised – surplus over Group’s minimum regulatory capital requirement of €2.7b Core equity represents 91% of the Group’s capital base €b €8.0b 8 CPS MIS €6.9b 7 MIPS €6.3b Core equity 6 €4.9b 5 4 €3.3b 3 2 1 0 2006 2007 2008 2009 2010 Pre-restructure: Tier 1 regulatory capital (Basel I) Post-restructure: Eligible regulatory capital (Basel II) EUR amounts have been converted solely for the convenience of the reader at the 31 March 2010 exchange rate: AUD = EUR0.6791 11
  12. 12. Assets under management of €221billion¹ Significant increase in AUM due to Delaware acquisition in Jan 10 • Excluding Delaware1, reported AUM decreased by €46b mainly due to the listed fund initiatives and strengthening of the $A since Mar 09 Pro-forma AUM includes impact of CMT/CMA transfer (€7b at Mar 10) €b 250 3 Banking and Financial Services €221b €215b2 Macquarie Funds Group 200 Real Estate Macquarie Capital Funds €158b €165b 150 €134b 100 €95b 50 0 2006 2007 2008 2009 2010 Mar 10 Pro-forma 1. Delaware Investments AUM at 31 Mar 10 was €103b. 2. Mar 10 pro-forma AUM includes the impact of the proposed conversion of the CMT to the CMA. CMT AUM was €7b at 31 Mar 10. 3. The Macquarie CMT, included in BFS AUM above, is a BFS product that is managed by MFG. EUR amounts have been converted solely for the convenience of the reader at the 31 March 2010 exchange rate: AUD = EUR0.6791. 12
  13. 13. Macquarie’s Operating Businesses
  14. 14. Macquarie’s Operating Businesses Update on recent initiatives Macquarie Securities Macquarie Capital A global specialist offering unique insights into energy, resources, commodities, Integrated global M&A, DCM, ECM and principal investing platform infrastructure, real estate, quant and FIG sectors driven by deep knowledge of specialising in Infrastructure, FIG, Real Estate, Industrials, TMET and the Asia Pacific region Resources Currently 8th largest broker based on global stock coverage – Over 2,700 The leading Asia-Pacific ECM house, plus rapidly expanding advisory stocks covered globally and ECM capabilities across Canada, the US, the UK, Germany and Maintained No.1 market share in Australia and growing in other regions. South Africa (MacCap completed a number of IPOs in all these regions Leading warrants market share Asia Pacific: Korea and Singapore (No.1), Hong during FY10) Kong (No.3) and Australia (No.1) for FY10 Leading alternative asset funds manager with $A96b of Assets Under Management across 100 businesses1 Acquisitions: Acquisitions: Acquisitions: Tristone: Sal Oppenheim – Equity Trading and Tristone: • Acquisition closed Aug 09, now called “Macquarie Tristone”. Integration complete • Fully integrated into MSG Derivatives • 43 new financings over $C4.4b for Canadian, American and European based oil and gas • 36 sales, research and trading • More than 90 staff based in Germany companies, where Macquarie acted as lead or co-lead in almost 30% of transactions professionals in London, Denver and and Switzerland • Closed 17 M&A transactions worth $C6.3b Calgary • Complements existing Asian derivatives • Macquarie ranked No.3 globally in FY10 by oil and gas M&A deal count (including undisclosed and private deals)2 FPK: operation and adds a wider set of • Fully integrated into MSG products to its growing European Fox-Pitt Kelton Cochran Caronia Waller (FPK): business • Acquisition closed 30 Nov 09. Integration now complete • Over 110 staff in New York, Hartford, Sal Oppenheim – Cash: • Participated in 12 new financings/raising over $US44b for US and European financial Boston, Chicago and London institutions • Added FIG sector expertise in North • Cash equities business comprising • US and Europe closed 11 FIG Advisory transactions worth $US1.3b America and Europe to complement equities research, sales and trading and • Macquarie/FPK US is currently mandated on 26 advisory engagements with aggregate Macquarie’s well established FIG position execution functions focused on estimated transaction size of approximately $US3.2b in the Asia-Pacific region continental Europe • Macquarie/FPK UK has been awarded a syndicate position on the landmark Prudential rights offering, in support of its acquisition of AIA from AIG • Brought FIG research to approximately • 50 new staff based in Germany, France 765 stocks globally and Switzerland Organic growth: Organic growth: • Broadens existing pan-European reach New offices: Buenos Aires, Mexico City and Moscow with the business being particularly New senior hires: 40+ new director-level hires during FY103 52 selective director level hires globally since New products: established DCM business in the US, taking part in $US3b of book-runs and strong in Germany FY09, majority of which are in the Cash $US3b of co-manager deals in four mths Division 1. As at 31 Mar 10. 2. Bloomberg. 3. In addition to the director-level appointments associated with the acquisitions of Tristone and FPK. 14
  15. 15. Macquarie’s Operating Businesses Update on recent initiatives Fixed Income, Currencies & Commodities Macquarie Funds Group Specialist in global commodity markets offering tailored price risk Strong, established fund management franchise, particularly in management solutions to significant commodity producers and Australia and the US, with over $A200b in Assets under consumers Management Top 5 physical gas marketer and highest ranked finance house in North Strength and discipline of an institutional manager with the America and participant in US physical power giving Macquarie and its responsiveness and innovation of a boutique clients important insights to energy market dynamics Leading arranger and placement agent in Australian primary debt markets and increasing participant in the US corporate debt markets offering clients valuable fundamental research, quality trade execution and outstanding trading opportunities Organic growth: Acquisitions: Energy Markets: Delaware Investments: • Energy Markets Division outperformed expectations in FY10 and focussed on • Running ahead of expectations consolidating its North American gas and power franchise – Macquarie Energy • Approx $US151b in AUM (as at 31 Mar 10) Asian expansion: • Now branded “Delaware Investments, a member of Macquarie Group” • Selective Asian growth initiatives with a Korean branch licence granted in 2H10 and • 20 staff from MFG now located in Philadelphia the establishment of a Singapore-based physical oil trading capability • Sales team combined in the US under Delaware Head of Distribution Credit Trading: • Ability to offer Macquarie product into US distribution platform across a • Finalisation of the US build-out of the Credit Trading business and a focus on variety of asset classes including infrastructure securities, REITs and opportunities in Europe commodities Emerging Markets: • Systems upgrade and integration project underway • Building upon the Miami based, Latam facing operation Organic growth: • Continued its growth in NY and began expansion into Europe • Selectively recruited 6 director level hires as part of organic expansion, Physical shipping: particularly in the fundamental team within Listed Equities and the fund • Shipping of coal, LNG, oil derivative capability in the US • Freight – wet and bulk freight trading services Fixed Income and Currencies: • Expansion in NY, London and Asia 15
  16. 16. Macquarie’s Operating Businesses Update on recent initiatives Corporate and Asset Finance Banking and Financial Services Strong technical expertise to provide finance and asset management Premium advice, service and products to Australian retail solutions to over 200,000 clients investors through Australia’s No.1 Full Service Retail Over $A13.6b of assets, including corporate debt and leased autos, Stockbroker, market leading platforms, supported by the largest IT&T, manufacturing, infrastructure/energy, rail and aviation engines cash hub in the country, and seeks to replicate this model in its international businesses in North America, Asia, and the UK Leading Australian independent motor vehicle financier Macquarie Wrap Solutions is one of Australia’s leading platforms Acquisitions: Acquisitions: Aviation Leasing Macquarie Private Wealth (Canada) (formerly Blackmont Capital) • Agreed to acquire a portfolio of 47 modern aircraft from International Lease Finance Corp for • Separation from former parent company CI completed and integration well advanced approx. $US1.7b • Total assets under management: $C8.25b, up 5% from acquisition • Aircraft on lease to 35 airlines in 27 countries • Total number of advisers 144 with 13 additional adviser recruits since completion • Leverages Macquarie’s existing expertise in the aviation leasing sector • Cross referral activities underway: e.g. opportunities for MPW advisors to bring • Completion to occur over remainder of calendar 2010 corporate advisory clients and private placements to Macquarie Capital IT Leasing • Expansion of research coverage from 100 stocks to approx 450 across Canada and • Acquisition of Technology Services Division of RTS and management of RTS’s approx. $US500m the US lease portfolio • Adds technology services capability to existing US equipment finance business and expands client • Continued growth in revenue expected for both Macquarie Capital and BFS base to over 2,400 companies in North America Organic growth: • Completion date: Feb 10 Selectively recruited 16 director level hires as part of the group's expansion into the UK and Motor Vehicle Leasing Asian financial services markets and also in specialist areas including insurance and Service • $A1.0b auto finance portfolios acquired as Ford Credit exits the Australian market and Operations in the Australasian market • Ford portfolio performance exceeding pre-acquisition projections • Further expansion of existing domestic leasing businesses to provide finance to Australian SMEs Organic growth: 6 director level appointments with expertise in leasing, lending, credit, legal and M&A 16
  17. 17. Macquarie in EMEA
  18. 18. Macquarie in EMEA Key information Regional headquarters – London 16 office locations in 10 countries Active in the region since the late 1980s 1,473 staff^ Abu Dhabi Income: €586 million Amsterdam (13 per cent of total income)* Bristol Cape Town Dubai Dublin Frankfurt Geneva Johannesburg1 Leeds London Moscow2 Munich Paris Stockholm Vienna Zurich *Income for the full year to 31 March 2010. ^As at 31 March 2010. EUR amounts have been converted solely for the convenience of the reader at the 31 March 2010 exchange rate: AUD = EUR0.6791. 1. Excludes staff in Macquarie First South joint venture. 2. Staff seconded to joint venture not included in official headcount (Moscow: Macquarie Renaissance, Savannah: Medallist). 18
  19. 19. Macquarie in EMEA Capital markets, advisory and securities Asset and Wealth Management Corporate finance and advisory Alternative asset funds management Debt structuring and distribution Hedge funds management Emerging markets advisory Intermediary services Equity capital markets, equity and debt capital management Products distribution and raising Retail financial services and advisory Institutional cash equities Retail and wholesale funds management Metals and energy capital Securities funds management Real estate development Structured and specialist investments Real estate investment management Lending Financial Markets Corporate Lending Arbitrage trading Equipment trading and remarketing Corporate action trading Finance and operating leasing Debt markets Real estate financing Emerging markets Environmental markets Freight markets Futures broking and clearing Over-the-counter derivatives in agricultural commodities, energy and metal markets Physical gas and electricity trading Securities borrowing and lending 19

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