Macquarie Group chief executive Nicholas Moore said the group's annuity-style businesses, including Macquarie Funds, Banking and Financial Services, and Corporate and Asset Finance have continued to perform well in the third quarter, with net profit contribution up for both the previous quarter and the corresponding period last year.
However, its capital-facing businesses, including Fixed Income, Currencies and Commodities (FICC), Macquarie Securities and Macquarie Capital experienced mixed trading conditions, with combined third quarter net profit contribution up from the September 2013 quarter but down from the previous corresponding period.
Mr Moore expects there to be no changes to the outlooks for each of the operating groups since Macquarie Group announced its 2014 half-year results in November last year, with the exception of FICC.
He said while Macquarie Group still expects FICC to be down from the 2013 financial year, it now has the “potential to be broadly in line with 2013 if recent improvements in market conditions persist”.
Following the release of the first-half results, the Macquarie Group 2014 operational briefing stated assets under management for Macquarie Funds had grown 13 per cent, up to $430.7 billion, mainly driven by foreign exchange, market movements and acquisitions.
The mortgage portfolio from Macquarie Group’s Banking and Financial Services business has also increased, rising 8 per cent from the second quarter to $15.8 billion.
Macquarie Securities experienced increased equity capital market activity, particularly in Australia and Asia, forming deals with OzForex Group, Cover-More Group, Dick Smith Holdings and YuanShengTai Dairy.
FICC had stronger client flows and opportunities across the global energy platform, but reduced credit trading volumes following the holiday period.
“While market volatility makes forecasting difficult, we continue to expect the FY14 net profit contribution from operating groups to be up on the FY13,” said Mr Moore.
Mr Moore added that he believes the tax rate will be similar to the 2013 financial year and that the second-half result for the 2014 financial year will be stronger than the first half.
