Macquarie Group Ltd. raised its profit guidance for full-year 2018 after noting that trading conditions across the group were "satisfactory" in the quarter ended Dec. 31, 2017.
The bank expects its net profit for the fiscal year ending March 31 to be up about 10% from the prior-year net profit of A$2.22 billion.
Combined net profit contribution from Macquarie's annuity-style businesses for the quarter ended December 2017 was slightly up year over year. Year-to-date net profit contribution, on the other hand, was up year over year, citing robust performance fees in the bank's asset management business, timing of transactions in its corporate and asset finance portfolio and continued growth in its banking and financial services.
The company said combined net profit contribution from its capital markets business for the quarter was down year over year, mainly due to the timing of income recognition associated with transportation and storage agreements within its commodities and global markets business. Year-to-date net profit contribution from the businesses also declined year over year.
Looking ahead, Macquarie expects the operating groups' combined net profit contribution for the fiscal year ending March 31 to be slightly up year over year. However, the group's net profit contribution for the fiscal half is expected to be down year over year and "broadly in line" with the half ended March 31, 2017.
As of Dec. 31, 2017, the group's capital surplus stood at A$4.1 billion, which is "broadly in line" with the quarter ended Sept. 30, 2017. The group's common equity Tier 1 ratio for the quarter stood at 10.7%, down from 11.0% in September 2017.
