Macquarie Bank Limited 2006 Annual General Meeting 20 July 2006 - PowerPoint PPT Presentation

Macquarie Bank Limited 2006 Annual General Meeting 20 July 2006

Macquarie Bank Limited 2006 Annual General Meeting 20 July 2006 Executive Chairman David Clarke

Disclaimer This presentation has been prepared by Macquarie Bank Limited ( Macquarie) ABN 46 008 583 542. This presentation does not take account of your objectives, financial situation or needs. Before acting on general advice you should consider the appropriateness of the advice having regard to these matters. Information, including forecast financial information, should not be considered as a recommendation in relation to holding, purchasing or selling securities or other instruments. While due care has been used in the preparation of forecast information, actual results may vary in a materially positive or negative manner. Forecasts and hypothetical examples are subject to uncertainty and contingencies outside the control of Macquarie. Past performance is not a reliable indication of future performance. 3

33% increase in underlying profit on pcp (reported:13% including impact of new accounting standards* and Macquarie Goodman restructure) Impact of AIFRS $Am Gain realised on formation of MGQ** AVNSã AVNSã 1,000 33% profit Reported result 900 increase AUNOã AUNOã excluding Reported result 800 AIFRS and 700 MGQ impacts 600 500 400 300 200 100 0 2002 2003 2004 2005^ 2006 Years ended 31 March * New accounting standards refer to Australian equivalents to International Financial Reporting Standards (AIFRS). ** MGQ refers to Macquarie Goodman Group. 4 ^Restated for AIFRS

33% increase in underlying profit on pcp (reported:13% including impact of new accounting standards and Macquarie Goodman restructure) Impact of AIFRS $Am Gain realised on formation of MGQ AVNSã AVNSã 1,000 33% profit Reported result 900 increase AUNOã AUNOã excluding Reported result 800 AIFRS and 700 MGQ impacts 600 AQVQã AQVQã 500 400 APPPã APPPã AORMã AORMã 300 200 100 0 2002 2003 2004 2005^ 2006 Years ended 31 March. ^Restated for AIFRS 5

27% increase in underlying EPS* on pcp (reported:8% including impact of new accounting standards and Macquarie Goodman restructure) Impact of AIFRS $Am 27% EPS attributable to formation of MGQ QMMÅ QMMÅ Reported EPS 450 underlying EPS PTMÅ PTMÅ 400 increase Reported EPS excluding 350 AIFRS and 300 MGQ impacts 250 200 150 100 50 0 2002 2003 2004 2005^ 2006 Years ended 31 March. * Basic EPS. ^Restated for AIFRS 6

27% increase in underlying EPS* on pcp (reported:8% including impact of new accounting standards and Macquarie Goodman restructure) Impact of AIFRS $Am 27% EPS attributable to formation of MGQ QMMÅ QMMÅ Reported EPS 450 underlying EPS PTMÅ PTMÅ 400 increase Reported EPS excluding 350 AIFRS and 300 MGQ impacts OPPÅ OPPÅ 250 200 NSRÅ NSRÅ NPPÅ NPPÅ 150 100 50 0 2002 2003 2004 2005^ 2006 Years ended 31 March. * Basic EPS. ^Restated for AIFRS 7

34% increase in ordinary dividend per share on pcp Ac Special dividend Ordinary dividend 250 ONRÅ ONRÅ OMNÅ OMNÅ 200 QMÅ 150 100 50 0 2002 2003 2004 2005 2006 8 Years ended 31 March

34% increase in ordinary dividend per share on pcp � Reintroduction of 2.5% discount on Dividend Reinvestment Plan Ac Special dividend Ordinary dividend 250 ONRÅ ONRÅ OMNÅ OMNÅ 200 QMÅ NQPÅ NQPÅ 150 NOOÅ NOOÅ RMÅ VPÅ VPÅ 100 50 0 2002 2003 2004 2005 2006 9 Years ended 31 March

32% increase in underlying income on pcp (reported:17% including impact of new accounting standards and Macquarie Goodman restructure) Impact of AIFRS Income realised on formation of MGQ $Am AQKQÄ AQKQÄ 4,500 32% income Reported result increase APKUÄ APKUÄ 4,000 excluding Reported result AIFRS and 3,500 MGQ impacts 3,000 2,500 2,000 1,500 1,000 500 0 2002 2003 2004 2005^ 2006 Years ended 31 March. ^Restated for AIFRS 10

32% increase in underlying income on pcp (reported:17% including impact of new accounting standards and Macquarie Goodman restructure) Impact of AIFRS Income realised on formation of MGQ $Am AQKQÄ AQKQÄ 4,500 32% income Reported result increase APKUÄ APKUÄ 4,000 excluding Reported result AIFRS and 3,500 MGQ impacts 3,000 AOKRÄ AOKRÄ 2,500 ANKVÄ ANKVÄ 2,000 ANKSÄ ANKSÄ 1,500 1,000 500 0 2002 2003 2004 2005^ 2006 Years ended 31 March. ^Restated for AIFRS 11

International income* growth 59% increase on pcp to $A2b 48% of total income $Ab 2.0 1.5 1.0 0.5 0.0 2002 2003 2004 2005 2006 12 * Excluding earnings on capital. Years ended 31 March

Over 8,600 staff in 24 countries International staff up 48% from June 2005 to almost 2,800 EUROPE ASIA NORTH AMERICA MIDDLE EAST 18 staff 1,247 staff 696 staff 669 staff Dublin Amsterdam Frankfurt Winnipeg London Vancouver Munich Montreal Paris Vienna Seattle Zurich Geneva Toronto Milan Chicago Boston Beijing San Francisco Rome Seoul Tokyo New York San Jose Memphis Tianjin Los Angeles Charleston Shanghai San Diego Houston Jacksonville Jupiter Taipei Abu Dhabi Miami Hong Kong Hsinchu Mumbai Manila Bangkok Labuan Kuala Lumpur Singapore Jakarta Sao Paulo Johannesburg Cape Town Auckland Wellington Christchurch AFRICA AUSTRALIA NEW ZEALAND SOUTH AMERICA 24 staff 5,860 staff 104 staff 25 staff 13 Staff numbers at 30 June 2006

Key elements of international risk management � New initiatives build on existing competencies, or competencies acquired through hiring or joint venture � Risk commitments generally start small � Particular controls and standards in offshore offices include: — Strong local management — Frequent management visits — Frequent internal audit reviews — Mix of experienced Macquarie staff and new staff — Central oversight of risk management — Centralised payment control 14

Risk weighted assets growth 45% increase on pcp to $A28.8b $Ab 30 25 20 15 10 5 0 2002 2003 2004 2005 2006 15 Years ended 31 March

Growing capital to support business growth Strong growth in ordinary shareholders equity $Ab 6.0 AQKUÄ AQKUÄ 5.0 $700m capital raising (May 2006) 4.0 APKOÄ APKOÄ 3.0 2.0 1.0 0.0 2002 2003 2004 2005 Mar 06 + capital raising Years ended 31 March. Ordinary share capital net of treasury shares, plus retained earnings and reserves attributable to ordinary shareholders. 16

Growing capital to support business growth Strong growth in ordinary shareholders equity $Ab 6.0 AQKUÄ AQKUÄ 5.0 $700m capital raising (May 2006) 4.0 APKOÄ APKOÄ 3.0 AOKQÄ AOKQÄ ANKUÄ ANKUÄ ANKSÄ ANKSÄ 2.0 1.0 0.0 2002 2003 2004 2005 Mar 06 + capital raising Years ended 31 March. Ordinary share capital net of treasury shares, plus retained earnings and reserves attributable to ordinary shareholders. 2002 and 2003 adjusted for dividend provision 17

Our increasingly diverse businesses are outgrowing the conventional banking regulatory model � Our diverse international businesses are growing much faster than our domestic banking businesses � A significant portion of our business is not strictly banking in nature � Commercial banking regulations do not readily accommodate this growth in non- banking business � We are discussing solutions with Australian Prudential Regulation Authority (APRA) � Australian regulations allow corporate groups containing bank and non-banking activities to structure themselves such that, subject to agreement with APRA, non- banking activities are not subject to banking regulations � We are examining the establishment of a Non-Operating Holding Company which would own both banking and non-banking businesses 18

Long-standing key philosophies � Strong risk management � Strong goals and values � Encouraging an entrepreneurial environment � Philosophy of freedom with boundaries � Remuneration systems — Recognise success — Encourage long-term commitment — Aligned with shareholder interests � Focus on delivering special value for clients � Delivering value for communities 19

20 Our staff helping their communities Volunteering around the world

21 Our staff helping their communities Volunteering around the world

22 Our staff helping their communities Volunteering around the world

23 Our staff helping their communities Volunteering around the world

24 Our staff helping their communities Volunteering around the world