Macquarie Group profit slumps 52 per cent

The degree to which the global financial crisis has hit the Macquarie Group has been made clear in its full-year profit results, with consolidated after tax profit attributable to ordinary equity holders of the consolidated entity declining 52 per cent to $871 million.

As well, the big banking and financial services group reported a 33 per cent decline in net operating income to just over $5.5 billion.

Commenting on the result, Macquarie Group managing director and chief executive Nicholas Moore said that it had remained profitable despite a year of challenging global market conditions and showed the group’s resilience and adaptability.

He said the result had been achieved despite substantial write-downs, much of which were provisions related to strategic long-term investments in Macquarie managed funds.

On the controversial issue of remuneration within the Macquarie Group, the company’s chief financial officer, Greg Ward, said employment expenses were down 44 per cent or $1.8 billion and the compensation ratio had fallen to 41 per cent from 47 per cent.

Drilling down on the various divisions within the Macquarie Group, the company said its banking and financial services group had recorded a loss of $99 million, driven by the sale of Italian mortgages, but despite this most businesses had performed well.

It pointed out that during the year the group had established a partnership with financial planning group WHK Group.

It said based on market share and trading volumes, Macquarie Private Wealth had again held the number one position for a full-service retail stock broking business.