Macquarie Faces Regulatory Challenges as CFO Steps Down and Divestment Looms
Macquarie Group Limited reported a 5% increase in FY25 profit to A$3.715 billion, declaring a higher dividend and announcing a key CFO transition. The group also outlined a strategic divestment and cautious outlook for FY26.
- FY25 profit up 5% to A$3.715 billion
- Final dividend increased to A$6.50 per share
- CFO Alex Harvey to step down end-2025, successor appointed
- Strategic divestment of public investments business in North America and Europe
- Robust capital position with A$9.5 billion surplus above regulatory requirements
Strong FY25 Performance
Macquarie Group Limited has delivered a solid financial performance for the fiscal year ended March 31, 2025, with net profit rising 5% to A$3.715 billion. This growth was underpinned by resilient contributions across its core operating groups, including Macquarie Asset Management, Banking and Financial Services, Commodities and Global Markets, and Macquarie Capital. Despite subdued conditions in some commodity markets, the group maintained steady income streams and operational momentum.
The board declared a final dividend of A$6.50 per share, up from A$6.40 the previous year, reflecting confidence in the group's earnings quality and capital strength. The dividend payout ratio remains within the targeted 50-70% range, balancing shareholder returns with capital retention for growth.
Strategic and Leadership Developments
In a significant leadership update, CFO Alex Harvey announced his decision to step down by the end of 2025, with Frank Kwok appointed as his successor effective January 2026. Both executives bring nearly three decades of experience at Macquarie, ensuring continuity in financial stewardship during a period of strategic transformation.
Macquarie also revealed plans to divest its public investments business in North America and Europe, comprising equities, fixed income, and multi-asset strategies. This move, coupled with a new strategic partnership with Nomura, aims to sharpen the group's focus on private markets and infrastructure investments, areas where it holds leading global positions.
Capital Position and Risk Management
The group maintains a robust capital surplus of A$9.5 billion above regulatory requirements, with a Common Equity Tier 1 (CET1) ratio of 12.6%, underscoring its strong balance sheet. Macquarie continues to apply a conservative approach to capital, funding, and liquidity management, positioning itself well to navigate ongoing market uncertainties.
Risk management remains a cornerstone of Macquarie’s strategy, with a disciplined framework and active oversight embedded across all business lines. The group reported a slight increase in conduct and policy breach matters, with appropriate consequences applied, reflecting a commitment to maintaining a strong risk culture.
Focus on Energy Transition and Climate Solutions
Macquarie continues to invest in energy transition and climate-related projects, supporting a managed and just transition for carbon-intensive industries. The group’s initiatives span renewable energy infrastructure, climate adaptation, and carbon offset projects, leveraging its global expertise to deliver practical climate solutions.
Outlook and Market Conditions
Looking ahead to FY26, Macquarie adopts a cautious stance amid global economic uncertainties, inflationary pressures, and geopolitical risks. The group expects stable base fees and net operating income broadly in line with FY25, with growth opportunities in private credit, banking deposits, and digital banking platforms. Margin pressures and provisioning remain areas of focus, alongside ongoing investments in technology and scalable growth initiatives.
Regulatory developments continue to shape the operating environment, with APRA consultations on capital instruments and ASIC proceedings related to compliance matters ongoing. Macquarie is actively engaging with regulators to address these challenges and strengthen governance frameworks.
Bottom Line?
Macquarie’s FY25 results and strategic moves set the stage for cautious growth, with investors watching closely how the CFO transition and divestment unfold amid evolving market dynamics.
Questions in the middle?
- How will the divestment of the public investments business impact Macquarie’s revenue mix and growth trajectory?
- What are the potential implications of ongoing ASIC proceedings on Macquarie’s compliance and reputation?
- How will the new CFO influence Macquarie’s financial strategy and capital management in a complex regulatory environment?
