UPDATE 2-Australia’s Macquarie Group sees record profit through the market turmoil

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FILE PHOTO: The logo of Australia’s biggest investment bank Macquarie Group Ltd adorns the main entrance to their Sydney office headquarters in Australia, October 28, 2016. REUTERS/David Gray/File Photo

SYDNEY (Reuters) – Australia’s largest investment bank Macquarie Group said on Tuesday it was on track for a record annual profit as its diversified business model helped offset short-term losses from recent global market volatility.

Macquarie said in a third-quarter trading update that corporate finance deals and commodities trading made up for weaker earnings in asset management, as it stuck to its target of 15 percent growth in net profit for the year to March.

“Macquarie remains well-positioned to deliver superior performance in the medium term,” said Shemara Wikramanayake in her first results announcement since she became chief executive officer in December.

The company said profit from its core “annuity-style businesses” in the third quarter was slightly higher than a year ago, but was down for the nine months to December because of lower performance fees in its asset management business.

Assets under management for the bank’s biggest-earning unit shrank 2 percent to A$551 billion ($389.06 billion) as at Dec. 31, from three months earlier, “predominately driven by market movements”, the company said.

Macquarie shares were up about 1 percent in early trading, while the broader Australian market was flat.

“At first glance we see nothing within the 3Q19 update or operational briefing material which will see material shifts to consensus current group profit forecast,” Bank of America Merrill Lynch analysts said in a note.

Reporting by Byron Kaye and Paulina Duran in Sydney and Nikhil Kurian Nainan in Bengaluru; Editing by Grant McCool and Stephen Coates

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