* Macquarie profits "slightly down" in nine months ended
* Macquarie expects annual profit in line with last year's
* Shares fall 2 percent
* Cut to U.S. corporate tax rate would benefit Macquarie:
By Jamie Freed
SYDNEY, Feb 7 Australia's Macquarie Group Ltd
said it was on track for flat full-year profit,
disappointing some investors who had hoped for a more bullish
outlook, while also seeking to reassure that its business model
would do well despite higher interest rates.
Shares in the country's top investment bank fell 2 percent
after it said nine-month earnings were "slightly down" and
reaffirmed that net profit for the year ending March 31 would be
in line with last year's record A$2.063 billion ($1.6 billion).
"They are a little bit behind their guidance and the market
was maybe hoping that they might upgrade as well given all of
the U.S. investment banks have done so well," Shaw Stockbroking
analyst David Spotswood said of the share price decline.
Expectations of higher interest rates in the wake of a hike
by U.S. Federal Reserve and President Donald Trump's economic
growth policies have prompted worries that Macquarie's asset
management and advisory businesses may be hurt as they focus on
infrastructure assets that typically have high levels of debt.
But Macquarie Chief Executive Nicholas Moore was quick to
brush off the concern.
"If we are seeing a turn in the cycle what that probably
means is the debt cycle will still be important but from a
growth viewpoint we'll probably see more of the equity part of
the equation," Macquarie Chief Executive Nicholas Moore said at
an analyst briefing on Tuesday.
He added that infrastructure assets like roads and airports
tended to perform better financially in periods of economic
growth, which are normally linked to rising interest rates.
Spotswood at Shaw Stockbroking said he thought Macquarie
remained well-positioned in the current environment.
"If the U.S. tax rate comes down that will help them or if
there is infrastructure build globally or in the U.S. that will
help them," he said,
Moore declined to comment on Macquarie's proposed purchase
of Britain's state-owned Green Investment Bank, which invests in
renewable energy projects - a deal that local UK media have
reported at 2 billion pounds ($2.5 billion).
The proposal has attracted opposition from some lawmakers,
who have accused it of planning to strip the bank of its assets,
the reports said.
Macquarie Capital group head Tim Bishop said the company was
interested in renewable energy projects as an asset class.
"Our typical role in green energy is to get into the early
stage creation of these assets...transferring assets to
the more natural long term owner of those assets," he said.
($1 = 1.3091 Australian dollars)
($1 = 0.8015 pounds)
(Reporting by Jamie Freed; Editing by Edwina Gibbs)