Macquarie Group, Ltd. · ASX:MQG
Macquarie — Investor Presentation (February 2017)
105 slides from Macquarie's investor presentation, Feb 7, 2017
Slide 1: Operational Briefing
For personal use only Operational Briefing Presentation to Investors and Analysts 7 February 2017
Slide 2: Disclaimer
Disclaimer For personal use only The material in this presentation has been prepared by Macquarie Group Limited ABN 94 122 169 279 (“Macquarie”, “the Group”) and is general background information about Macquarie’s activities current as at the date of this presentation. This information is given in s
Slide 3: Agenda
Agenda For personal use only 10:05 – 10:10 Introduction – Karen Khadi 10:10 – 10:30 Update since the interim result – Nicholas Moore 10:30 – 10:50 Communicating with the investment community – Patrick Upfold 10:50 – 11:10 Banking and Financial Services – Greg Ward 11:10 – 11:30 Macquarie Capital – T
Slide 4: Introduction
For personal use only 01 Introduction Karen Khadi – Head of Investor Relations
Slide 5: Update since the interim result
For personal use only 02 Update since the interim result Nicholas Moore Managing Director and Chief Executive Officer
Slide 6: About Macquarie
About Macquarie For personal use only Building for the long term Macquarie Asset • Top 50 global asset manager with $A501.7b1 of assets under management Management • Provides clients with access to a diverse range of capabilities and products, including infrastructure and real asset management, secu
Slide 7: 3Q17 Overview
3Q17 Overview For personal use only • Satisfactory trading conditions in 3Q17 across the Group • Macquarie’s annuity-style businesses’ (Macquarie Asset Management, Corporate and Asset Finance and Banking and Financial Services) combined 3Q17 net profit contribution1 up on pcp (3Q16) – FY17 YTD2 net
Slide 8: 3Q17 Overview: Annuity-style businesses
3Q17 Overview For personal use only Annuity-style businesses 1H17 contribution1 Activity during the quarter • AUM of $A501.7b at Dec 16, up 2% on Sep 16 predominately driven by positive FX and market movements • MIRA: $A1.4b in new equity raised largely in Australian, Global and European Infrastruct
Slide 9: 3Q17 Overview: Capital markets facing businesses
3Q17 Overview For personal use only Capital markets facing businesses 1H17 contribution1 Activity during the quarter • Announced the merger of MSG and CFM to create an integrated, end-to-end offering across global markets including equities, fixed income, foreign exchange and commodities; progressin
Slide 10: 13,647 staff in over countries
13,647 staff in over 27 countries For personal use only Europe, Middle East & Africa Asia Americas Staff: 1,463 Staff: 3,479 Staff: 2,530 Asia Europe Bangkok Mumbai Canada Dublin Beijing Seoul Calgary USA Frankfurt Gurugram Shanghai Montreal Austin Los Angeles Hong Kong Singapore Toronto Boca Raton
Slide 11: Funded balance sheet remains strong
Funded balance sheet remains strong For personal use only $Ab 31 March 2016 $Ab 30 September 2016 $Ab 31 December 2016 140 140 140 130 130 130 ST wholesale issued paper (7%) ST wholesale issued paper (8%) 120 Other debt maturing in the next 120 ST wholesale issued paper (6%) 120 12 mths 1 (9%) Cash,
Slide 12: Strong regulatory ratios
Strong regulatory ratios For personal use only Macquarie Bank Group (Dec 16) Macquarie Bank Group (Harmonised 1 ) Macquarie Bank Group (APRA) Basel III minimum 2 6.2% 14.0% 6.0% 200% 12.6% 5.0% 10.5% 150% 174% 4.0% 5.3% 10.5% 7.0% 3.0% 100% 2.0% 3.5% 50% 1.0% - - - 3 CET1 ratio Leverage ratio LCR 1.
Slide 13: Regulatory update
Regulatory update For personal use only • Basel Capital Framework – The Basel Committee has delayed the finalisation of proposals to amend the calculation of risk weighted assets under Basel III. Any impact on capital will depend upon the final form of the proposals and local implementation by APRA
Slide 14: Basel III capital position
Basel III capital position For personal use only • APRA Basel III Group capital at Dec 16 of $A17.5b, Group surplus of $A3.7b1 • Bank Group APRA Basel III CET1 ratio: 10.5%; Tier 1 ratio: 11.6%; Leverage ratio: 5.3% • Bank Group Harmonised Basel III CET1 ratio: 12.6%; Tier 1 ratio: 13.8%; Leverage r
Slide 15: Factors impacting short-term outlook
Factors impacting short-term outlook For personal use only FY17 combined net profit contribution1 from operating groups expected to be broadly in line with FY16 Annuity-style businesses Capital markets facing businesses Macquarie Asset Management Commodities and Global Markets • FY16: $A1.6b; 1H17 d
Slide 16: Short-term outlook
Short-term outlook For personal use only • We currently expect the FY17 combined net profit contribution1 from operating groups to be broadly in line with FY16 • The FY17 tax rate is currently expected to be broadly in line with FY16 • Accordingly, the Group’s result for FY17 is currently expected t
Slide 17: Medium-term
Medium-term For personal use only • Macquarie remains well positioned to deliver superior performance in the medium-term • Deep expertise in major markets • Build on our strength in diversity and continue to adapt our portfolio mix to changing market conditions – Annuity-style income is provided by
Slide 18: Approximate business Basel III Capital & ROE
Approximate business Basel III Capital & ROE For personal use only As at 30 Sep 16 1 APRA Basel III Capital Approx. 1H17 Return Approx. 10-Year Average 2 Operating Group @ 8.5% ($Ab) on Ordinary Equity2 Return on Ordinary Equity Annuity-style businesses 8.4 Macquarie Asset Management 1.5 Corporate a
Slide 19: Medium-term
Medium-term For personal use only • Annuity-style business that is diversified across regions, products, asset classes and investor types • Diversification of capabilities allows for the business to be well placed to grow assets under management in different MAM market conditions • Well positioned f
Slide 20: Macquarie – a diversified financial group
For personal use only 03 Macquarie – a diversified financial group Communicating with the investment community Patrick Upfold, Chief Financial Officer
Slide 21: Macro environment for financials
Macro environment for financials only Global Financial Crisis: Indexed 120 Credit crunch For personal use Liquidity issues for financials Market volatility Concerns over global 100 European sovereign and bank capital levels bank system concerns Fitch downgrade of seven major banks in US and Europe 8
Slide 22: Macquarie has not been immune
Macquarie has not been immune For personal use only Capital markets facing businesses impacted Increased funding costs and capital requirements Increased cost of compliance Heightened impairments Regulatory matters PAGE 22
Slide 23: Macquarie share price vs other financials
Macquarie share price vs other financials Indexed only 140 For personal use 120 100 80 60 40 20 - Dec 06 Dec 07 Dec 08 Dec 09 Dec 10 Dec 11 Dec 12 Dec 13 Dec 14 Dec 15 Dec 16 MSCI World Capital Markets Index Macquarie Data to 3 Feb 17. PAGE 23
Slide 24: Macquarie is a diversified financial group
Macquarie is a diversified financial group For personal use only Macquarie is a diversified financial group providing clients with asset management and finance, banking, advisory and risk and capital solutions across debt, equity and commodities Stable earnings Geographically Strong financial Long t
Slide 25: The business has evolved
The business has evolved For personal use only Business mix1 Geographic mix2 FY07 FY16 FY07 FY16 MAM Americas CAF 15% 16% 4% CGM BFS 35% Australia 6% Asia 47% 15% MAM MacCap 37% EMEA Australia Americas 40% CGM 22% 32% 30% 19% CAF MacCap Asia 26% 10% EMEA 14% BFS 24% 8% 1. Business mix is based on ne
Slide 26: Supported by a diverse investor base
Supported by a diverse investor base For personal use only Share register by type1 Funding by region2 Staff 7% Australia 21% US Domestic 27% Retail Institutional 25% 37% EMEA 27% International Asia Institutional 25% 31% 1. As at 31 Dec 16. 2. Includes all funding raised during FY16. PAGE 26
Slide 27: Strong financial position
Strong financial position For personal use only Funded Balance Sheet1 Surplus Capital2 Credit Ratings 31 December 2016 31 December 2016 31 December 2016 $Ab 140 120 Short-term Cash, liquids and debt self securitised assets 100 Customer $A3.7b 80 Trading deposits assets 60 Loan assets < 1 year 25 yea
Slide 28: Long track record of profitability
Long track record of profitability For personal use only $Am 2.0 Hill Samuel UK 1.6 opens branch office in Sydney 1.2 Currency 0.8 Recession Crisis 0.4 - Hills Motorway 1969 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 Global real Mortgage securitisation $Am 100 estate crash 80 Stock London off
Slide 29: Stable earnings
Stable earnings For personal use only 5 year earnings volatility relative to Macquarie 10 year earnings volatility relative to Macquarie (since GFC) (includes GFC) Multiple to Macquarie 14.0 Multiple to Macquarie 65.0 64.6x 64.0 12.0 11.6x 63.0 10.0 12.0 8.0 10.0 8.9x 8.0 6.0 6.0 4.0 4.0 2.7x 2.4x 2
Slide 30: Stable credit ratings
Stable credit ratings For personal use only Standard & Poor’s Ratings Movements from 2007 Rating movement (notches) AA+ AA AA- 3 5 6 5 2007 A+ 0 2 6 4 1 5 A A- 2017 BBB+ BBB Intra-period Macquarie JPMorgan Credit Suisse UBS AG Bank of Citibank Morgan Stanley Goldman Sachs Barclays Deutsche ratings B
Slide 31: Performance in a changing global environment
Performance in a changing global environment For personal use only 50 % 43 % JUN 13 – JUN 14 FEB 16 – FEB 17 LONG TERM LONG TERM Dec 15 – Feb 16: SHARE PRICE PERFORMANCE SHARE PRICE PERFORMANCE 100 Macro oil concerns 2,500 NPAT ($Am) Share price ($A) Oil price down ~21% 90 US and European banks down
Slide 32: Our approach to communicating with investors
Our approach to communicating with investors For personal use only What we do How we do it Consistency in approach 1 Report business performance Timeliness 2 Provide detail around individual businesses Focus on key business drivers Anticipate emerging areas of 3 interest Reinforce key messages 4 Pro
Slide 33: 1. Report business performance
1. Report business performance For personal use only ‘‘ What is driving the result of the businesses? Consistency in presentation for 7 years PAGE 33
Slide 34: 2. Provide detail around individual businesses: Commodities and Global Markets
2. Provide detail around individual businesses For personal use only Commodities and Global Markets ‘‘ What does this business actually do? Business drivers Enhanced disclosures Access to management PAGE 34
Slide 35: 2. Provide detail: Corporate and Asset Finance – Leasing
2. Provide detail around individual businesses Corporate and Asset Finance – Leasing For personal use only ‘‘ How do recent acquisitions improve shareholder returns? Business drivers Enhanced disclosures Access to management PAGE 35
Slide 36: 3. Anticipate emerging areas of interest
3. Anticipate emerging areas of interest For personal use only Impairments and tax ‘‘ What is driving the increase in impairments and the effective tax rate? Enhanced disclosures PAGE 36
Slide 37: 3. Anticipate emerging areas: Macquarie Asset Management
3. Anticipate emerging areas of interest For personal use only Macquarie Asset Management ‘‘ How to think about performance fees going forward? Business drivers Enhanced disclosures Access to management PAGE 37
Slide 38: 4. Provide context at the Group level
4. Provide context at the Group level For personal use only Business mix Consistency Enhanced disclosures Every presentation starts with CGM Annuity-style this slide 19% MAM income 1 37% MacCap 10% >70% BFS of Macquarie’s 8% net profit CAF contribution 26% Every Asset presentation Mgt ends with 15%
Slide 39: Strong shareholder returns
4. Provide context at the Group level For personal use only Strong shareholder returns For purchases made at any point in time and held to date, Macquarie has consistently outperformed the ASX 200, Diversified Financials and MSCI World Capital Markets Index Outperformance (%) 3000% Above 500% Outper
Slide 40: Communication is continuous
Communication is continuous For personal use only Reinforce key Provide messages consistency Continuous engagement Continuous Anticipate enhancement emerging areas of disclosures of interest PAGE 40
Slide 41: Banking and Financial Services
For personal use only 04 Banking and Financial Services Greg Ward, Group Head
Slide 42: Banking and Financial Services
Banking and Financial Services For personal use only Superior services for banking, wealth and business clients, delivered through a leading digital experience and strong intermediary relationships Personal Banking 1.1 million Business Banking ● Full retail banking product suite with AUSTRALIAN ● Fu
Slide 43: Our history in retail financial services
Our history in retail financial services BFS has evolved to focus on serving the Australian market For personal use only with leading digital solutions Mortgages Australia (‘92) Mortgages US (‘02-‘07) Mortgages Italy (‘04-‘08) Personal Consumer Lending (‘05-‘08) Banking Mortgages Canada (‘06-‘11) Ca
Slide 44: A significant market opportunity in Australia
A significant market opportunity in Australia For personal use only With a growing digital market Growing Australian financial services A highly connected digital economy market ($Atr)1 90% of Australians 2 in 3 Australians will be online in 2017 6.5 6.4 are on social media 6.3 6.1 6.0 5.7 Most Aust
Slide 45: An evolving financial services industry
An evolving financial services industry Innovation and digitisation are driving rapid change For personal use only in financial services Seamless integration of financial services in daily life Powering the as devices, cloud adoption, ‘internet of things’ and connected world open data contribute to
Slide 46: Macquarie has a long history of innovation in retail financial services
Macquarie has a long history of innovation in retail financial services BFS has a strong track record of successfully adapting to For personal use only changing market opportunities ‘16 ‘17 ‘14 DEFT ‘11 API enabled BPAY AuctionPay More on personalised technology experiences Xero Virtual ‘06 Adviser
Slide 47: We are delivering through our key priorities
We are delivering through our key priorities For personal use only Well placed to capitalise with a technology led business Strong growth opportunities through new and 1 Partnerships existing relationships, intermediary To extend reach distribution and white labelling Modernising technology to impro
Slide 48: Strategic focus is driving results
Strategic focus is driving results For personal use only While we continue to invest in platforms for the future Net profit contribution1 ($Am) Project spend ($Am) 85% 245 350 85% 228 81% 80% 285 80% 260 180 243 79% 17% 17% 75% 141 76% 196 128 119 149 144 70% 109 113 70% 15% 101 11% 261 65% 170 9% 8
Slide 49: Personal Banking
Personal Banking For personal use only Personal Banking 1.1 million Business Banking AUSTRALIAN ● Full range of deposit, lending and ● Full retail banking product suite with payment solutions mortgages, credit cards, transaction and CLIENTS savings accounts ● Tailored services for a wide range of bu
Slide 50: Strong mortgage intermediary and white label partnerships
Personal Banking For personal use only Strong mortgage intermediary and white label partnerships Partnerships Platforms Digital Strong mortgage intermediary First Australian bank with World class digital banking relationships and white label mortgages and retail deposits experience for new and
Slide 51: Rebuilding our mortgage portfolio
Personal Banking For personal use only Rebuilding our mortgage portfolio Australian mortgages growth vs market1 Australian mortgages (cumulative %) ($Ab) 180% 28.5 28.6 BFS Market 24.5 120% 17.0 60% 11.6 10.8 0% FY12 FY13 FY14 FY15 FY16 1H17 Mar 12 Mar 13 Mar 14 Mar 15 Mar 16 Dec 16 Since 1993 Partn
Slide 52: Prudent approach to credit quality in our mortgage originations
Personal Banking For personal use only Prudent approach to credit quality in our mortgage originations Loan to value ratio (%) Owner occupier versus investor loans (%) 100% 100% 80% 80% 60% 60% 40% 40% 20% 20% - - FY12 FY13 FY14 FY15 FY16 3Q17 Market FY12 FY13 FY14 FY15 FY16 3Q17 Market <=60 60-70 7
Slide 53: Strong history of growth in deposits
BFS Deposits For personal use only Strong history of growth in deposits BFS deposits ($Ab) 44.2 40.4 37.3 33.3 31.0 29.0 26.6 15.5 13.4 6.6 Mar 08 Mar 09 Mar 10 Mar 11 Mar 12 Mar 13 Mar 14 Mar 15 Mar 16 Dec 16 $A44.2b 5 Star Canstar Award1 Winner Term Deposit Provider 3 Outstanding Value for Transac
Slide 54: Macquarie's new digital banking experience
Macquarie’s Personal Banking new digital Macquarie’s new digital banking experience For personal use only banking experience Cue to video
Slide 55: Wealth Management
Wealth Management For personal use only Personal Banking 1.1 million Business Banking ● Full retail banking product suite with AUSTRALIAN ● Full range of deposit, lending and payment mortgages, credit cards, transaction and CLIENTS solutions savings accounts ● Tailored services for a wide range of ●
Slide 56: Innovative and trusted partner of choice for platform administration
Wealth Management For personal use only Innovative and trusted partner of choice for platform administration Partnerships Platforms Digital 22 institutional, white and Leading Macquarie Wrap Continuous innovation in private label partnerships platform digital tools and online Significant longs
Slide 57: Strong funds on platform growth
Wealth Management For personal use only Strong funds on platform growth Funds on platform growth vs market1 Funds on platform (cumulative %) ($Ab) 160% 80 BFS Market 70.5 70 120% 58.4 60 48.0 80% 50 40.3 40 40% 27.5 30 23.9 0% 20 FY12 FY13 FY14 FY15 FY16 1H17 Mar 12 Mar 13 Mar 14 Mar 15 Mar 16 Dec 1
Slide 58: Business Banking
Business Banking For personal use only Personal Banking 1.1 million Business Banking AUSTRALIAN ● Full range of deposit, lending and payment ● Full retail banking product suite with solutions mortgages, credit cards, transaction and CLIENTS savings accounts ● Tailored services for a wide range of bu
Slide 59: Tailored and sophisticated solutions for business banking target segments
Business Banking Tailored and sophisticated solutions for business banking For personal use only target segments Partnerships Platforms Digital Forming innovative Delivering efficiencies and Launched Kubio, a cloud based partnerships to enhance simplifying workflows CRM and loan origination th
Slide 60: Growing faster than the market through our targeted segments
Business Banking For personal use only Growing faster than the market through our targeted segments Business lending growth vs market1 Business lending (cumulative %) ($Ab) 120% 7.0 6.5 BFS Market 5.9 6.0 90% 5.2 5.0 60% 4.1 4.0 3.3 30% 3.0 3.0 0% 2.0 FY12 FY13 FY14 FY15 FY16 1H17 Mar 12 Mar 13 Mar
Slide 61: Well positioned for the future
Well positioned for the future Driving results through our four key priorities, centred For personal use only around our clients Partnerships To extend reach Platforms Digital To support growth Client focus People And right capabilities PAGE 61
Slide 62: Macquarie Capital
For personal use only 05 Macquarie Capital Tim Bishop, Group Head
Slide 63: Overview of Macquarie Capital
Overview of Macquarie Capital For personal use only Telecommunications, M&A Advisory Media, Entertainment and Technology Principal Investments – Merger, acquisition, (TMET) – Deploy balance sheet to divestiture and takeover advice support clients – Corporate, project, leveraged Financial Resources –
Slide 64: We tailor our offering in each region to play to our strengths
We tailor our offering in each region to play to our strengths For personal use only ANZ EMEA Americas Asia Infrastructure Real Estate TMET >75% of revenue1 Resources Focus on Industrials Germany FIG Strong focus Targeted focus Focus on areas where we Combine advice with Foster an have deep expertis
Slide 65: We are globally diversified with a core strength in real assets
We are globally diversified with a core strength in real assets For personal use only Revenue by sector1 Revenue by product1 Revenue by region1 8% 8% 12% 11% 11% 35% 41% 18% 13% 57% 24% 15% 12% Real 35% assets Infrastructure Real Estate M&A Advisory Principal Investments ANZ Americas TMET Resources
Slide 66: Over the last five years our revenue and profit contribution has grown
Over the last five years our revenue and profit contribution has grown For personal use only Revenue1 1,166 Profit contribution2 451 $Am $Am 430 1,071 844 654 280 281 672 623 280 654 463 383 179 394 150 512 570 85 205 381 448 140 150 170 289 260 77 101 8 10 FY12 FY13 FY14 FY15 FY16 1H17 FY12 FY13 FY
Slide 67: We operate globally
We operate globally with ~1,100 staff serving our clients in key locations For personal use only CANADA EMEA 20 % ASIA 5% 15% 29% UNITED STATES ANZ 31% WORLDWIDE As at 31 Dec 16. PAGE 67
Slide 68: What makes us unique
What makes us unique For personal use only Strong expertise Market leading Number one A world leader in Track record in Ability to invest achieved through position in globally in global real estate partnering with alongside our deep and stable Australia & New Infrastructure2, with Private Capital te
Slide 69: Infrastructure
Infrastructure 41% of global revenue1 For personal use only M&A Advisory Asset creation 41% Green energy asset creation Why we are successful 250+ transaction staff globally In-house operational Relationships with Established track record, specialising in infrastructure M&A and technical expertise i
Slide 70: Grow our leading global infrastructure M&A Advisory business
Grow our leading global infrastructure M&A Advisory business For personal use only Continue to focus and maximise Selected transactions opportunities for clients in our key markets through our deep infrastructure M&A Advisory capabilities and expertise Most innovative investment SELECTED Airports De
Slide 71: Leverage our M&A Advisory expertise into infrastructure asset creation
Leverage our M&A Advisory expertise into infrastructure asset creation and platforms For personal use only Leverage our deep infrastructure Selected highlights M&A Advisory, project finance, PPPs expertise to create infrastructure assets and platforms SELECTED Advisory Excellence Award1 Infrastructu
Slide 72: Lead the market in creating green energy assets
Lead the market in creating green energy assets For personal use only Utilise our deep infrastructure M&A Selected transactions Advisory, Principal investment, technical and operational expertise, coupled with our balance sheet to create green energy assets SELECTED Best European Wind Deal1 Power De
Slide 73: Developing and constructing green energy assets
We are focusing on developing and constructing green energy assets For personal use only Deep dive: Green energy asset creation Lower investment per deal Higher investment per deal IRR Development Construction Operational Lower risk Battery, Solar, Waste Offshore wind PAGE 73
Slide 74: We have deep technical and operational expertise
We have deep technical and operational expertise For personal use only Deep dive: Green energy asset creation Critical success factors Examples of in-house specialists Expertise in green energy Deep understanding of Civil Green energy operational technologies leading solar, wind, waste engineers spe
Slide 75: Green energy is a global story
Green energy is a global story For personal use only Deep dive: Green energy asset creation Market opportunity: Our track record Green energy investment expected over next five years1 Europe Australia $ US150b US20b $ Asia Americas $ US600b US240b $ Leverage capabilities and expertise globally 1. Bl
Slide 76: Real Estate
Real Estate 12% of global revenue1 For personal use only Partnering unlisted capital Investing in real estate specialists 12% Why we are successful M&A capability A world leader in global Deep and longstanding Track record of sourcing Investment providing to build scale real estate Private instituti
Slide 77: A global leader in partnering unlisted institutional capital for real estate
We are a global leader in partnering unlisted institutional capital for real estate For personal use only Advise and invest alongside real estate operators to help Partner unlisted institutional capital them grow into leading global with specialist real estate operators sector specialists Leverage o
Slide 78: TMET
TMET 15% of global revenue1 For personal use only TECHNOLOGY: Partner with entrepreneurs Investing alongside financial sponsors 15% Why we are successful Deep, longstanding Strong understanding and market Flexible Availability of long-term relationships with clients insights in technology across Pri
Slide 79: We partner with entrepreneurs and provide long-term growth capital
We partner with entrepreneurs and provide long-term growth capital to technology companies For personal use only Partner with entrepreneurs and Selected highlights founders, with a focus on online, software and data businesses across Australia, China, Europe and the US Work actively with management
Slide 80: We drive M&A deals by investing alongside financial sponsors
We drive M&A deals by investing alongside financial sponsors to facilitate transactions For personal use only Drive M&A Advisory deal flow and Selected highlights transactions by providing flexible capital rapidly to financial sponsors TECHNOLOGY INVESTMENTS As technology increasingly impacts all se
Slide 81: Resources, Industrials and Financial Institutions
Resources, Industrials and Financial Institutions 32% of global revenue1 For personal use only FIG 8% IND Full service in ANZ 11% LEGEND FIG Financial Institutions Group RES IND Industrials Targeted approach offshore 13% RES Resources PAGE 81
Slide 82: We focus on targeted opportunities in Resources, FIG and Industrials
We focus on targeted opportunities in Resources, FIG and Industrials For personal use only ANZ EMEA Americas Asia Resources Strong focus Targeted focus Focus on Industrials Germany FIG Selected highlights Provide a full service offering in ANZ, with a targeted offering in niche segments overseas 1.
Slide 83: We are well positioned for growth
We are well positioned for growth For personal use only Stable Market leading Number one A world leader Track record Investing senior team position in ANZ1 in Infrastructure in Private Capital in technology alongside globally2 Markets for our clients Real Estate3 1. Dealogic, by deal value (announce
Slide 84: Macquarie in Asia
For personal use only 06 Macquarie in Asia Ben Way, Regional Head – Asia
Slide 85: Asia's market conditions
Asia’s market conditions For personal use only GDP growth (2015–2030F)1 ($UStr) 2030F Central bank interest rates2 +2.4% p.a. 45 8% 30 +6.0% p.a. 5% 15 +8.8% p.a. 2% +2.5% p.a. +4.2% p.a. - (1.0%) China Japan India South Korea G7 (ex Japan) 2010 2012 2014 2016 China Japan India South Korea US Stock
Slide 86: Asia's growth drivers
Asia’s growth drivers For personal use only Urban population1 Middle class population2 Population % of Total population Population % of Global middle class population 51% 45% 3b 48% 2b 45% 35% 2b 27% 1b 1b 2.1 2.3 1.9 1.3 0.8 0.5 - - 2010 2015 2020F 2010 2015 2020F No. of megacities 13 17 21 Total s
Slide 87: Asia's operating environment
Asia’s operating environment For personal use only Asia’s capital market and M&A activity1 Assets under management (AUM)2 Chinese insurers’ asset allocation3 CAGR ($USb) ($UStr) ($UStr) $US1.0tr $US1.8tr +15.0% 1,200 8 60 100% CAGR Alternatives +56.5% 12.0 +9.3% 900 6 45 75% 7.7 Equity +18.0% 600 4
Slide 88: Macquarie in Asia: Operating platform
Macquarie in Asia For personal use only Operating platform An established presence since 1995 3,479 employees ~50% global shared services Beijing Seoul 4 key business lines Tokyo MAM, CAF, CGM, MacCap 13 locations Gurugram Shanghai 15 regional stock exchanges across 11 markets Hong Kong Taipei membe
Slide 89: Macquarie in Asia: Platform evolution
Macquarie in Asia For personal use only Platform evolution 2005 2008 2012 2014 2015 Annuity-style businesses Manila and Gurugram Discretionary First regional Listed infrastructure Philippine fund in Singapore Shared Service Centres infrastructure fund Investment infrastructure opened Management fund
Slide 90: Macquarie in Asia: Operating groups
Macquarie in Asia For personal use only Operating groups Annuity-style businesses Macquarie Asset Management MIM has 4 investment MIRA manages $A16.2b Macquarie Asia teams managing $A30.1b Raised $A5.3b MIM continued regional across 60 infrastructure and Infrastructure Fund across Asian equities, fi
Slide 91: Macquarie in Asia: Operating groups
Macquarie in Asia For personal use only Operating groups Capital markets facing businesses Commodities and Global Markets Access to physical and Integrated end-to-end Extensive regional footprint Risk and capital solutions financial commodity offering across with equities execution across G10 and As
Slide 92: Macquarie in Asia: Performance
Macquarie in Asia For personal use only Performance Asia operating income1 Annuity-style businesses Steady performance $Am $Ab $A290m 1,500 50 1H17 operating income +142% $A120m 1,250 40 28% from annuity-style businesses 1,000 1H17 operating income FY12 FY16 30 (16% in FY12) 750 Capital markets faci
Slide 93: Macquarie in Asia: People and culture
Macquarie in Asia For personal use only People and culture Staff profile Staff engagement and enablement 31 Dec 11 31 Dec 16 Change Staff 2,818 3,479 Diversity & Country Talent Female staff 39% 43% Inclusion Leadership Development (D&I) Local staff 94% 98% Local directors 82% 91% Multilingual n/a1 9
Slide 94: Macquarie in Asia: Risk management framework
Macquarie in Asia For personal use only Risk management framework Globally consistent risk focus and approach Asia regulatory themes Global risk management framework Market reform Information security with a strong risk culture Conduct risk Enforcement Financial crime Requirement Ownership of risk U
Slide 95: Macquarie in Asia: Medium term focus
Macquarie in Asia For personal use only Medium term focus Focus on key Leverage areas of Drive cross-border markets expertise flows Realise significant Focus on infrastructure, real Facilitate the flow of capital opportunities in scale estate, securities and and ideas between Asia markets commoditie
Slide 96: Focus on key markets: China example
Focus on key markets For personal use only China example Market opportunity Macquarie platform Leading foreign fund manager for Outbound capital under Population GDP / growth Cities domestic real assets management No.1 No.2 No.1 1 $A2.3b AUM, 12 assets $A1.6b 1,382m people global economy 100+ cities
Slide 97: Leverage area of expertise: Renewables infrastructure
Leverage area of expertise For personal use only Renewables infrastructure Expertise Portfolio1 Pipeline Renewables specialist in Asia Solar | Wind | Waste | Hydro ~7.5GW pipeline One of the No.2 Growing Largest Windfarm Solar power renewable operator capacity investors in South across Asia Developm
Slide 98: Drive cross-border flows
Drive cross-border flows For personal use only MAM CGM $A25b Cross-border M&A for Asian clients in Macquarie European Distribution of the last 3 years Infrastructure Fund 5 trade-related assets to capital raising from Asia Asian institutions2 €1.1b $US7.9b $A5.3b 2016 2016 Americas EMEA Asia Capital
Slide 99: One firm approach: Platinum clients
One firm approach For personal use only Platinum clients Platinum client case study One of Asia’s largest insurers Relationship Map the Present one lead opportunity Macquarie Repeat and growing revenue and pipeline across CGM, MAM and MacCap Managing $A2.7b of client’s capital across a broad Full-se
Slide 100: Macquarie in Asia: Well positioned for the future
Macquarie in Asia For personal use only Well positioned for the future Macro Connectivity Opportunity Focus PAGE 100
Slide 101: Glossary
For personal use only Glossary A
Slide 102: Glossary
Glossary For personal use only $A / AUD Australian Dollar CAGR Compound Annual Growth Rate $C / CAD Canadian Dollar CCB Capital Conversion Buffer $US / USD United States Dollar CCP Central Counterparties £ / GBP British Pound CET1 Common Equity Tier 1 € Euro CFM Commodities and Financial Markets 1H1
Slide 103: Glossary
Glossary For personal use only FX Foreign Exchange ILFC International Lease Finance Corporation FY07 Full Year ended 31 March 2007 IMF International Monetary Fund FY08 Full Year ended 31 March 2008 IPO Initial Public Offering FY09 Full Year ended 31 March 2009 IT Information Technology FY10 Full Yea
Slide 104: Glossary
Glossary For personal use only MIC Macquarie Infrastructure Corporation RHS Right Hand Side MIDIS Macquarie Infrastructure Debt Investment Solutions ROE Return on Equity MIM Macquarie Investment Management RWA Risk Weighted Assets MIRA Macquarie Infrastructure and Real Assets S&P Standard & Poor's M
Slide 105: Operational Briefing
For personal use only Operational Briefing Presentation to Investors and Analysts 7 February 2017
Macquarie Group — Investor Presentation (February 2017) on 6ix