Macquarie Group (ASX:MQG) executives told investors that the company’s third quarter of fiscal 2026 played out broadly as expected, with earnings weighted to the second half of the year and strong performances in Macquarie Asset Management and Macquarie Capital helping drive momentum. Chief Executive Officer Shemara Wikramanayake said the operational briefing reflected the group’s diversified footprint across four operating groups, supported by central service teams focused on risk management and technology.
Third quarter performance and business drivers
Wikramanayake said Macquarie Asset Management (MAM) was “substantially up” both versus the comparable third quarter and year-to-date, citing the completion of the divestment of public investments in North America and Europe and increased performance fees year-to-date. She said the divestment involved the transfer of about AUD 250 billion of assets to Nomura.
Banking and Financial Services (BFS) was “up slightly” on the prior quarter and year-to-date, driven by growth in loans and deposits, offset by margin compression and the run-off of a higher-margin car lease portfolio. Wikramanayake said home loans were up 7%, business banking up 1%, and deposits up 6%, while funds on platform were down 1% due to market movements in the composition of platform balances.
In Commodities and Global Markets (CGM), Wikramanayake said the quarterly result improved versus the comparable period and was in line with the prior year-to-date, with the “catch-up” largely driven by increased asset finance earnings. She said financial markets were in line and commodities performance improved in North American gas and power and resources, partly offset by higher costs tied to operating platform remediation programs and transaction costs.
Macquarie Capital was also “substantially up” versus the comparable quarter and year-to-date. Wikramanayake attributed this to growth in the credit book, equity realizations, and fee and commission income. She said private credit grew AUD 5.7 billion to AUD 28.9 billion and noted realizations including ParkingEye and iPlanet in Europe. She added that activity levels were up year-over-year, though the prior-year third quarter was a particularly strong period.
Capital, funding, and regulatory matters
Macquarie reported capital and liquidity ratios “comfortably above” Basel III amendments, including CET1, leverage, LCR, and NSFR. Wikramanayake said surplus capital was AUD 7.5 billion, down AUD 1 billion, mainly due to payment of the second-half dividend, partly offset by third-quarter earnings and capital absorbed in businesses.
She described notable capital movements, including around AUD 800 million in credit capital in CGM heading into the northern winter, capital absorbed by Macquarie Capital from private credit growth, and several hundred million dollars of capital released in MAM following the exit of the North American and European public investments business. BFS capital usage was described as flat despite growth in books due to the car leasing run-off.
On regulatory and legal matters, Wikramanayake said APRA had announced a reduction of add-ons in Macquarie’s LCR and NSFR and that the group continues to work with APRA on previously discussed programs. She also said Macquarie and ASIC had agreed, in relation to a short sale transaction reporting matter, to submit to the court a proposed AUD 35 million penalty.
Management outlook and commodities guidance
Looking ahead, management reiterated group-by-group guidance. For MAM, Wikramanayake said that excluding the divested public investments business, base fees were expected to be broadly in line, while “net other operating income” was expected to be “significantly up,” driven by performance fees.
For BFS, she guided to ongoing growth in loans, deposits, and funds on platform, subject to competitive dynamics affecting margins and continued investment in the technology platform. For Macquarie Capital, she said transaction activity was expected to be in line with last year (which she described as strong), while the group expects continued growth in private credit and increasing equity realizations as the book “seasons.” For CGM, she said Macquarie expected continued contributions from asset finance and financial markets and upgraded guidance to expect commodities income to be up for FY26.
In Q&A, executives linked the commodities upgrade to North American winter conditions and the firm’s ability to monetize “optionality” from its physical footprint. CGM executives described how extreme cold weather in January produced a sharp but short-lived move in U.S. gas prices and said Macquarie benefited from its infrastructure footprint, including pipelines, power lines, and financial transmission rights. They also said locational spreads remained relevant and noted Macquarie’s footprint included “about 19 pipe assets across North America and Canada.”
CGM executives also discussed long-dated LNG offtake contracts, describing the approach as “cautious and incremental.” They said Macquarie had engaged in two long-term offtakes that were yet to go final investment decision and highlighted awareness of projected LNG supply overhang to around 2031–2032.
Private credit, software exposure, and risk management focus
Executives addressed investor questions on software exposure within private credit and equity portfolios. Management said around 25%–30% of the private credit book was in software, with additional exposures across the broader “TMET” space such as managed services, marketplaces, and government services. Macquarie Capital executives said the firm lends primarily against cash flow, describing typical lending as around 4–8 times free cash flow and lending at approximately 30%–40% of assessed value. They said they were monitoring AI-related disruption risk, but did not see major issues at the time, and characterized exposure to SaaS models vulnerable to seat-based revenue displacement as small.
Asked about loss rates, executives said the market convention for the private finance book was about 10 basis points per annum and said experience in the past year was consistent and “under 10 basis points thus far.” They also said the book is matched-funded and oriented to holding to maturity, with funding costs transferred through to operating businesses.
Group Chief Risk Officer Andrew Cassidy later described a risk approach centered on business ownership of risk, worst-case outcome focus and stress testing, and independent sign-off by the Risk Management Group. He said Macquarie had increased Risk Management Group headcount to about 1,200 from close to 900 in 2019 and highlighted investment in non-financial risk, compliance, and global risk capability. On the software and AI theme, Cassidy said risk teams assess criticality of software, proprietary data, and business-model susceptibility and then apply stress testing using lenses from prior disruptive periods, connecting outcomes to capital, funding, and profitability assumptions.
Australia and New Zealand deep dive, technology and AI
Macquarie also used the briefing to spotlight its Australia and New Zealand operations. Wikramanayake said 36% of Macquarie’s income comes from the region and nearly 50% of staff are based there. Operating group leaders described regional scale and growth initiatives across advisory, markets, asset management, and retail banking.
BFS head Ben Perham emphasized Macquarie’s “digital-first” approach and said BFS has over 2 million customers across Australia. He described growth in home loans and deposits, and said BFS’s return on equity was approximately 13% on a fully allocated basis, including profit share and corporate costs and adjusting for funding from capital. He also disclosed that personal banking headcount had been reduced by 24% since August 2023 while the home loan book grew by over 50%, attributing the operating leverage to process automation and customer self-service.
On technology, Corporate Operations Group head Nicole Sorbara said group technology spend had “stabilized” at about AUD 2.3 billion after a period of material investment. Chief Technology Officer David Tough said Macquarie had “no reportable cyber incidents in 2025,” that 100% of assets were protected against advanced threats, and that teams ranked in the “top 3% globally for phishing.” He also described progress in cloud adoption, including exiting seven global data centers and having about 91% of applications running on cloud and SaaS.
BFS Chief Digital Data and AI Officer Ashwin Sinha said BFS is 99% on cloud and operates a single data platform. He said BFS had eliminated 90% of manual adjustments over the last two years and has 50 AI solutions in production. He also said BFS achieved 99.95% availability with “no planned outages,” and that client protection tools reduced client losses by 55% over two years while reducing false positives across AML and fraud by more than 80% over three years as deposits grew 50%.
About Macquarie Group (ASX:MQG)
Macquarie Group Limited provides diversified financial services in Australia, the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company operates through four segments: Macquarie Asset Management (MAM), Banking and Financial Services (BFS), Commodities and Global Markets (CGM), and Macquarie Capital. The MAM segment provides investment solutions to clients across various capabilities in private markets and public investments, including infrastructure, green investments, agriculture and natural assets, real estate, private credit, asset finance, equities, fixed income, and multi-asset solutions.
