Sydney, 01 December 2011
Macquarie Group Limited (Macquarie) today noted Standard and Poor’s (S&P) updated ratings for the Macquarie group of companies:
In its release, S&P highlighted that the stable outlook reflected the expectation that “Macquarie will continue to demonstrate very good risk management capabilities” and said it viewed Macquarie’s strategy as “sound overall, with the group making a strategic shift following the global financial crisis toward broadening its business base”.
S&P noted “Macquarie’s very good risk-management track record and relatively good loss history”.
Macquarie’s Chief Financial Officer, Mr Greg Ward, said: “The affirmation of Macquarie Bank’s rating is an excellent outcome. Macquarie Bank is our main operating entity and funds the vast majority of our businesses. The S&P decision to keep the rating unchanged, despite challenging market conditions, validates our strong capital, funding and liquidity position.”
Mr Ward noted that Macquarie Bank was one of the few global financial institutions to retain its ratings throughout the volatile market conditions experienced since 2008. Since first being rated by S&P in 1991, Macquarie Bank’s ratings have remained unchanged for over 20 years.
Mr Ward said that the ratings outcome reflected Macquarie’s ability to continually adapt to changing market conditions. Annuity-style income is provided by three large businesses which are delivering superior returns following years of investment and recent acquisitions. Mr Ward noted S&P’s statement that it gained comfort from “the contribution to revenues from business lines that demonstrate more predictable returns, such as some of Macquarie’s banking and leasing business lines and its large asset-management business”.
The ratings for Macquarie Group Limited, which funds the residual requirements of the group, changed to ‘BBB’ long-term from ‘A-‘ with a Stable outlook. This change reflects the application of the revised S&P rating methodology. Macquarie Group Limited’s short-term issuer credit rating remains unchanged at ‘A-2’.
Mr Ward said: “The non-banking businesses remain well funded with a weighted average term funding maturity of 4.8 years, strengthened by the recent refinancing of Macquarie Group Limited’s Senior Credit Facility.”