Macquarie as optimistic as ever

Three of Macquarie Group's three main divisions are finally paying their way, while the rest continue to drag on the group's returns.

Macquarie Funds, Corporate and Asset Finance, and Banking and Financial Services earned a collective average return on equity of 19 per cent for the year.

The other three divisions, Macquarie Securities, Macquarie Capital, and Fixed Income and Commodities, returned an average of only six per cent.

Six months ago Macquarie Securities and Macquarie Capital both earned next to no return in the year to March 2013, compared with a return of around 20 per cent for the Fixed Income group.

Annualised return on equity at the group level was 8.7 per cent in the September 2013 half, down from 8.9 per cent in the March 2013 half, which puts a different gloss on the excited market response to the group's profit announcement on Friday and the promise of a better second half.

Nicholas Moore, chief executive of the group, said on Friday that four of its six divisions may report higher profits over the full year.

"In terms of overall group themes coming through, remuneration compensation ratio, we think, will be at consistent levels."

"Higher cost of funds will continue… and, based upon the present mix of income, we think the tax line will be broadly consistent with where we were last year [at 38 per cent].

"Assuming that the markets are no different than they were last year, we expect the full year will be up on where we were last year."