Macquarie Group's investments in Asia, most notably its acquisition of ING Group's Asian equity capital markets business in 2004, have helped the group overcome weaknesses in a number of areas in the 2007/08 year and maintain its long run of earnings growth.Macquarie reported record net profit of $1.8 billion for the year to March, an increase of 23 per cent over 2006/07. The big headline number was achieved despite almost $300 of write-downs on property holdings, a significant downturn in asset realisations and an ignominious withdrawal from the mortgage market in Australia and the United States.The ING acquisition, now part of Macquarie Securities, gave Macquarie coverage in Hong Kong, Korea, Japan, Taiwan, Thailand, China, Indonesia and the Philippines.The income contribution from Asia in the latest year was around $2 billion, more than 70 per cent up on the previous year. Income from Australian operations of $3.3 billion was up seven per cent on the previous year, compared to five year compound annual growth of 20 per cent.Income from Europe, Africa and the Middle East was down two per cent to $1.5 billion.The big fall was in the Americas, where the $852 million of income was 24 per cent below the previous year. Much of the fall in the Americas was due to the write-downs on investments in listed property trusts. Macquarie wrote down the value of its positions in four property trusts. Trusts that took a hit were Macquarie CountryWide (down $113 million), Macquarie Office Trust ($99 million), J-Rep Co ($72 million) and Macquarie DDR ($9 million). Since March 31 Macquarie has suffered a further $6 million of unrealised losses on those holdings.The contribution to the group result from the real estate division was down from a net profit of $507 million in 2006/07 to a loss of $81 million in the latest year.The other big disappointment was banking and securitisation. Macquarie does not hold loans on balance sheet and it was hit hard by the closure of the securitisation market late last year. Net profit fell from $143 million in 2006/07 to $51 million.Macquarie pulled out of the mortgage market in the United States and has restricted its Australian mortgage operations to existing clients and a handful of distribution partners. Banking and securitisation contributes only one percent to group earnings so the fall, while significant, did not have much of an impact overall.The contribution from asset and equity investment realisations, a far more important contributor to Macquarie earnings at 11 per cent of total income, was down from $1.8 billion in March last year to $951 million.On the positive side Macquarie had substantial investment banking deal flow, with the value of transactions around $200 billion. It raised $22 billion in its specialist funds and its performance fees rose substantially.Macquarie chief financial officer Greg Ward said the group's balance sheet was very sound, with $3 billion of excess capital and liquid assets of $18.3 billion.