Macquarie Bank posted a record full year profit of $2.21 billion, a 7.46% rise on last year and slightly ahead of expectations.
The result compares to $2.063 billion last year, then a record result and a return to pre GFC performances.
Macquarie shares were up 3.6% to $95.25 in early trade.
The full year results show Macquarie had a good second half. Net profit for the second six months was $1.167 billion, up 11% on the first half and 18% on the same six months in 2016.
CEO Nicholas Moore says 2017 highlights the strength of Macquarie’s global platform, the benefit of recent acquisitions including the Green Investment Bank in the UK and the group’s ability to adapt to changing conditions.
Net operating income was up 2% to $10.36 billion and operating expenses grew 2% to $7.26 billion.
Macquarie’s assets under management at the end of March 2017 were $481.7 billion, broadly in line with the $478.6 billion of last year.
The group’s international business at $6.43 billion accounts for 63% of total income, but this was a 5% fall on 2016.
Loan impairments and provisions were down 53% to $271 million mainly due to reduced exposure to underperforming commodity-related loans.
Macquarie’s annuity-style businesses, including Macquarie Asset Management=, Corporate and Asset Finance and Banking and Financial Services — about 70% of the group’s business — had a combined net profit contribution of $3.25 billion, up 4%.
The capital markets facing businesses — Commodities and Global Markets and Macquarie Capital — had a combined net profit contribution of $1,45 billion, up 12%.
Staff numbers were down 5% to 13,597 from 14,372
“The group remains well positioned, with a strong and diverse global platform and deep expertise across a range of products and asset classes,” says Moore.
“This is built on the foundation of a strong balance sheet, surplus capital, a robust liquidity and funding position and a conservative approach to risk management which is embedded across all operating groups.”
Macquarie expects net profit in the 2018 financial year to be broadly in line with 2017.
The company increased the dividend payout. Macquarie announced today a second half final dividend of $2.80 a share, 45% franked, up from the first half’s $1.90.
The total payout for the year is $4.70, is up from $4.00.
The numbers for the 12 months to March: