Macquarie Bank Limited Investor Presentation – JPMorgan conferences, New York and Edinburgh Richard Sheppard Deputy Managing Director September 2007
Disclaimer The name "Macquarie" refers to the Macquarie Group, which comprises Macquarie Bank Limited and its worldwide subsidiaries, affiliates, and the funds or companies that they manage. Future results are impossible to predict. Opinions and estimates offered in this presentation constitute our judgement and are subject to change without notice, as are statements about market trends, which are based on current market conditions. This presentation may include forward-looking statements that represent opinions, estimates and forecasts, which may not be realized. We believe the information provided herein is reliable, as of the date hereof, but do not warrant its accuracy or completeness. In preparing these materials, we have relied upon and assumed, without independent verification, the accuracy and completeness of all information available from public sources. Macquarie Bank Limited is not licensed to conduct banking business in the United States. It maintains Representative Offices in New York, Texas, California and Washington. With respect to matters pertaining to US securities laws, and to the extent required by such laws, Macquarie Bank Limited and its worldwide subsidiaries consult with, and act through, Macquarie Securities (USA) Inc., a registered broker-dealer and member of FINRA, or another US broker-dealer. Macquarie Bank Limited, London Branch, is authorised to conduct banking business in the United Kingdom. Macquarie Bank Limited, London Branch, Macquarie Europe Limited and Macquarie Investment Management (UK) Limited are authorised and regulated by the United Kingdom Financial Services Authority. Any Macquarie subsidiary noted in this presentation is not an authorized deposit-taking institution for the purposes of Banking Act (Commonwealth of Australia) 1959, and such subsidiaries obligations do not represent deposits or other liabilities of Macquarie Bank Limited ABN 46 008 583 542. Macquarie Bank Limited does not guarantee or otherwise provide assurance in respect of the obligations of any such subsidiary. Past performance is not an indicator of future performance. Throughout this report, periods prior to the 2005 financial year are reported under previous AGAAP, unless otherwise stated. 2
Agenda � Overview � Financial performance � Growing internationally � Proposed restructure � General update and outlook � Appendices — Earnings drivers — Analysis by business segment — Restructure – further detail 3
A diversified financial services institution � Full service in Australia � Broad investment banking in Asia-Pacific � Focussed participation in international markets � Established 1969, banking license 1985, listed 1996 � Market capitalisation: $A20.4b* – Top 15 company on ASX, over 100,000 shareholders (*as at 9c * At 19 Sept 2007 4 h 06 – Macquarie Securities)
Over 11,000 staff in 24 countries 25% increase since August 2006 EUROPE & MIDDLE EAST ASIA NORTH AMERICA 1,105 staff 1,806 staff 1,225 staff Beijing Seoul Tokyo Tianjin Shanghai Calgary Vancouver Winnipeg Taipei Hong Kong Hsinchu Seattle Manchester Toronto Montreal San Francisco Dublin Manila San Jose Amsterdam New Delhi Chicago Boston London Irvine Paris Frankfurt Bangkok Troy Denver New York Los Angeles Zurich Munich Mumbai Carlsbad San Diego Geneva Vienna Labuan Atlanta Savannah Kuala Milan Houston Singapore Jacksonville Rome Lumpur Miami Jakarta Dubai Abu Dhabi Sunshine Coast Brisbane Broadbeach Perth Newcastle Adelaide Sydney Melbourne Canberra Auckland Wellington Christchurch Sao Paulo Johannesburg Cape Town AFRICA AUSTRALIA NEW ZEALAND SOUTH AMERICA 42 staff 6,747 staff 112 staff 23 staff As at 31 Aug 2007 5
Operating income is diversified Financial year ended 31 March 2007 Investment banking: 42%* Asset & wealth management: 27%* Income up 75% on prior year Income up 39% on prior year Investment banking, real estate and other specialist funds Mergers and acquisitions, advisory, underwriting and Retail and wholesale principal transactions funds management and private client broking Commodities Institutional cash FX, futures, treasury and debt markets equities Financial products Equity derivatives Banking and securitised lending Equipment and other leasing Lending: 10%* Real estate lending Financial markets: 21%* Income up 23% on prior year Income up 34% on prior year Other lending * Represents contribution to total income 6
39 year history of profit Net Profit After Tax $Am March 1600 2007 1500 1400 1300 3 1200 1100 2 1000 900 800 1 700 600 500 0 400 69 71 73 75 77 79 300 200 100 0 69 75 81 87 93 99 '05 7 Years ended 31 March. Data current to 31 March 2007. From 2005 numbers have been reported under International Financial Reporting Standards
Agenda � Overview � Financial performance � Growing internationally � Proposed restructure � General update and outlook � Appendices — Earnings drivers — Analysis by business segment — Restructure – further detail 8
Financial Performance Financial year ended 31 March 2007 Income of $A7.2b Profit of $A1.46b $Am $Am 49% increase on pcp 60% increase on pcp 8000 1600 7000 1400 6000 1200 5000 1000 800 4000 600 3000 400 2000 200 1000 0 0 2002 2003 2004 2005 2006 2007 2002 2003 2004 2005 2006 2007 Dividend of $A3.15 Basic EPS of $A5.92 Acps 47% increase on pcp cps 48% increase on pcp 350 700 300 600 250 500 Special dividend 200 400 150 300 100 200 50 100 0 0 2002 2003 2004 2005 2006 2007 2002 2003 2004 2005 2006 2007 Years ended 31 March 9
41% increase* in assets 70% increase in under management international income Financial year ended 31 March 2007 INTERNATIONAL INCOME ASSETS UNDER MANAGEMENT $Am $Ab Securities Wholesale 4000 Securities Retail 200 Other Specialist 3500 Real Estate Infrastructure 3000 150 2500 2000 100 1500 1000 50 500 0 0 2002 2003 2004 2005 2006 2007 2002 2003 2004 2005 2006 2007 Aug-07 � 55% of total income � $225b at August 2007- up 14% since 31 Mar 07 in FY2007 Years ended 31 March 10 * % increase for year ended 31 March 2007
Expense/income ratio slightly down Financial year ended 31 March 2007 Expense $Am to Income Ratio (%) 8,000 82% � Expense/income ratio Income slightly down at 73.2% 7,000 80% Expenses Expense to income ratio 6,000 78% 5,000 76% 4,000 74% 3,000 72% 2,000 70% 1,000 0 68% 2002 2003 2004 2005 2006 2007 Information on this chart has been restated for all periods to bring it into line with the presentation of fee and commissions expenses as operating expenses. 11
Risk weighted assets growth 3.7 times the level of 5 years ago $Ab $A39.4b 40 35 $A28.8b 30 25 $A19.8b 20 15 $A13.4b $A10.6b $A10.0b 10 5 0 2002 2003 2004 2005 2006 2007 12
Growing capital to support business growth Strong growth in ordinary shareholders’ equity $Ab 8.0 ATKNÄ ATKNÄ $750m capital raising & $80m share purchase plan 7.0 (May 2007) 6.0 AQKUÄ AQKUÄ 5.0 $700m capital raising (May 2006) 4.0 APKOÄ APKOÄ AOKQÄ AOKQÄ 3.0 ANKUÄ ANKUÄ ANKSÄ ANKSÄ 2.0 1.0 0.0 2002 2003 2004 2005 Mar 06 + capital Mar 07 + capital raising raising Ordinary share capital net of treasury shares, plus retained earnings and reserves attributable to ordinary shareholders. 2002 and 2003 adjusted for dividend provision 13
Agenda � Overview � Financial performance � Growing internationally � Proposed restructure � General update and outlook � Appendices — Earnings drivers — Analysis by business segment — Restructure – further detail 14
From an Australian institution growing internationally to a global institution headquartered in Australia � 70% increase in international income on prior corresponding period from $A2b to $A3.5b despite much stronger $A � International income 55% of total income*, up from 48% in prior year $Am 7,000 International Australia 6,000 5,000 4,000 3,000 2,000 1,000 0 2002 2003 2004 2005 2006 2007 * Excluding earnings on capital and after costs directly attributable to earning the income, including fee and commissions expenses. 15
From an Australian institution growing internationally to a global institution headquartered in Australia � International specialist fund equity raisings are more than triple Australian raisings $Am International 24,000 $A21.6b Australia 20,000 16,000 $A12.4b $A13.7b (5 months) $A11.7b 12,000 8,000 $A3.5b 4,000 0 2004 2005 2006 2007 Apr - Aug 07 Years to 31 March 16
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