By Angus Whitley
Feb. 9 (Bloomberg) -- Macquarie Group Ltd., Australia’s largest investment bank, said second-half profit may climb from the first half as markets recover along with the global economy.
Net income in the six months to March 31 is expected to be in line with its first-half profit of A$479 million ($414 million) and may beat that by 10 percent, the bank said in a statement to the stock exchange today.
Australian financial institutions including Commonwealth Bank of Australia and Axa Asia Pacific Holdings Ltd. have reported higher profits as markets recover from the global financial crisis. Macquarie Chief Executive Officer Nicholas Moore used the slowdown to spend more than $770 million on acquisitions last year in North America, ranging from energy advisory and asset management units to brokerages.
“There’s a fair bit more to come,” said Hugh Dive, who helps manage about $3 billion at Investors Mutual Ltd. in Sydney. Moore is performing a “balancing act” between buying assets and keeping a capital cushion against volatility, said Dive.
Macquarie, with capital of A$4.5 billion above the regulatory minimum, said today the completion of acquisitions will strengthen its product offering and global presence. The bank last week agreed to buy the equity trading and research operations of Sal. Oppenheim Jr. & Cie in KGaA to expand its business in Europe, following a December agreement to buy Sal.’s derivatives business.
“Despite improving trends in a number of major markets, we continue to maintain a conservative approach to funding and capital,” Moore said in the statement. “Our strong balance sheet, strong team and encouraging market conditions provide opportunities for medium term growth.”
To contact the reporter on this story: Angus Whitley in Canberra at awhitley1@bloomberg.net