Macquarie continues its successful expansion in Asia

18 August 2005

In a presentation to investors and analysts about its Asian businesses, Macquarie Bank Deputy Managing Director, Richard Sheppard, said today the Macquarie Group's growth in Asia had been better than anticipated following the acquisition of the ING cash equities business last year and was expected to continue, subject to market conditions.

Income from Asia for the year ended March 31, 2005 was up 96 per cent to $408 million from the prior corresponding period. Mr Sheppard said a key factor in the success of Macquarie's businesses in Asia has been the approach of hiring local people wherever possible.

"The strategy of positioning Macquarie as 'the most local' foreign financial services firm in each of our Asian markets, focussing on niches where we believe we can add value, has been successful."

"Macquarie is also growing new businesses by stepping into spaces adjacent to existing established businesses. Macquarie's staff numbers in Asia have grown from 120 to over 850 since 2000. Asia now has Macquarie's largest team outside Australia," Mr Sheppard said.

Mr Sheppard said the Group has recently announced a number of Asian initiatives, including:

  • Macquarie's acquisition of a strategic stake in Singapore's Prime REIT
  • The establishment of the Macquarie International Infrastructure Fund (MIIF), listed on the Singapore Stock Exchange
  • The acquisition, with investors, of nine retail malls in China and the acquisition of a number of infrastructure assets in Korea
  • The opening of businesses in India and the establishment of a joint venture in Thailand
  • Being awarded a stockbroking license in Malaysia

Highlights from the presenters to the briefing include:

Macquarie Securities Managing Director, Roy Laidlaw, said:

  • Macquarie Securities' strategy is to improve its service, product range and market share in Asian markets following the integration of the ING business
  • Strong growth expected from the Macquarie Securities business in Asia
  • We hope that the Asian securities business will generate similar returns to the Australian securities business in the next couple of years
  • The Asian securities business has hired more than 75 people and is continuing to hire aggressively in the region

Head of Asia, Corporate Finance Business, Mr Andrew Low said:

  • The corporate finance group's strategy is to focus on niches where Macquarie can demonstrate differentiation and competitive advantages in capital raising, advisory, funds or principal transactions
  • The increase in corporate finance deal flow and revenue since the ING acquisition is well ahead of expectations, albeit off a low base and still early days
  • Revenue has increased by 2.5 times since the ING acquisition
  • The total number of corporate finance professionals is up from 85 a year ago to 125 today and revenue per head has also increased

In commenting on the outlook of the corporate finance business, Mr Low said that momentum continues to build steadily across countries and products and the next twelve months is likely to see more of:

  • Yield based issuance in Singapore, Korea and Hong Kong and maybe other markets
  • Infrastructure deals outside Korea and transactions in other sectors within Korea
  • Further diversification of revenues across the 11 offices in the region, building on success in early focus countries like Singapore and the Philippines where Macquarie has been bookrunner for the largest IPOs in those markets

The Head of Asia for the Equity Markets Group, Paul O'Brien, said:

  • Our strategy in Asia is to use our leading position in Hong Kong as a base to expand into other markets
  • Equity markets this year established a Singapore business which is now a leading issuer of warrants in that market
  • Other markets Macquarie is looking at include Korea, Taiwan, China, India, Malaysia and Japan

Division Head, Property and Banking Group, Stephen Girdis, said:

  • Macquarie Property is a global expert in cross border REITs and is the fastest growing promoter of successful REITs, with over US$3 billion raised in listed equity in Asia Pacific since January 2003
  • Macquarie Property and its associates have received recognition as the leading property investment manager in Asia and have $4 billion in assets under stewardship in Asia
  • Mr Girdis said that cyclical recoveries and structural changes in Asian markets were creating opportunities in property and property capital markets. He said Macquarie was active in, or looking at, opportunities in China, Hong Kong, Korea, Singapore, Japan, Malaysia and India

Macquarie Country Head for Korea, John Walker, said:

  • Macquarie, which entered the market in 1996, now employs 239 staff across 10 businesses, five joint ventures and three funds
  • Approximately 90 per cent of staff are Korean speaking
  • Macquarie was awarded a Korean Presidential Citation for its contribution to foreign investment
  • Korean Road Infrastructure Fund (KRIF) has raised $1.7 billion which is invested in more than $8 billion in assets. The Shareholder Agreement provides for potential listing

For further information, please contact:

Matthew Russell
Public Relations
Macquarie Bank Limited
Tel: (612) 8232 4102
Mobile: (614) 1069 9532

Lotte Pang
Media Relations, Hong Kong
Tel: (852) 9805 4070

Disclaimer: Macquarie Bank Limited ABN 46 008 583 542 is authorized by The Australian Prudential Regulation Authority in the Commonwealth of Australia and The Financial Services Authority in the United Kingdom, to carry out banking business or to accept deposits in those respective jurisdictions. Macquarie Bank Limited and its related bodies corporate (the Macquarie Bank Group) are not otherwise currently authorised to carry out banking business or to accept deposits in any other country.

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