Macquarie mortgage growth drives strong profit result

Macquarie Bank is on track to deliver an annual profit of more than $2 billion off the back of strong growth in its mortgage and asset finance businesses.

In a trading update on Friday, Macquarie announced a 58 per cent increase in net profit to $1.07 billion for the six months to 30 September.

The bank said the strong result was driven by increased lending and asset financing activity, with Macquarie’s Australian mortgage portfolio growing 13 per cent from $24.5 billion at 31 March 2015 to $27.6 billion at 30 September.

Macquarie noted the acquisition of a residential mortgage portfolio of $1.2 billion during the period. The bank’s domestic mortgage growth was partially offset by a reduction in its Canadian and United States mortgage portfolios, which are in run-off and closed at a combined $2.6 billion at 30 September 2015, down 31 per cent from $3.8 billion at 31 March 2015.

Macquarie’s corporate and asset finance arm’s loan and finance lease portfolios increased four per cent from $22.2 billion at 31 March 2015 to $23.0 billion at 30 September 2015, mainly driven by the impact of the depreciation of the Australian dollar and the acquisition of Advantage Funding in July 2015, the group said.

Last month Macquarie purchased the Esanda Dealer Finance portfolio from ANZ for approximately $8.23 billion.

The portfolio includes net lending assets of $7.8 billion, comprising retail point-of-sale auto finance of $6.2 billion, and wholesale bailment facilities and other Esanda branded finance offered to motor vehicle dealers of $1.6 billion.

Upon completion of the acquisition, the total motor vehicle finance portfolio managed by Macquarie Leasing will increase from $9 billion to approximately $17 billion.

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