Investor Presentaiton
Macquarie FY20 result announcement I macquarie.com
Introduction
Overview of Result
Result Analysis and Financial Management
Outlook
Appendices
Explanation of funded balance sheet reconciling items
O
MACQUARIE
Self-funded trading assets: Macquarie enters into stock borrowing and lending as well as repurchase agreements and reverse repurchase agreements
in the normal course of trading activity that it conducts with its clients and counterparties. Also as part of its trading activities, Macquarie pays and
receives margin collateral on its outstanding derivative positions. These trading-related asset and liability positions are presented gross on the statement
of financial position but are viewed as being self-funded to the extent that they offset one another and, therefore, are netted as part of this adjustment.
Derivative revaluation accounting gross-ups: Macquarie's derivative activities are mostly client driven with client positions hedged by offsetting
positions with a variety of counterparties. The derivatives are largely matched and this adjustment reflects that the matched positions do not
require funding.
Segregated funds: These represent the assets and liabilities that are recognised where Macquarie provides products such as investment-linked policy
contracts or where Macquarie holds segregated client monies. The policy (contract) liability and client monies will be matched by assets held to the same
amount.
Outstanding trade settlement balances: At any particular time Macquarie will have outstanding trades to be settled as part of its brokering business
and trading activities. These amounts (payables) can be offset in terms of funding by amounts that Macquarie is owed on other trades (receivables).
Short-term working capital assets: As with the outstanding trade settlement balances above, Macquarie through its day-to-day operations generates
working capital assets (e.g. receivables and prepayments) and working capital liabilities (e.g. creditors and accruals) that produce a
'net balance' that either requires or provides funding.
Non-controlling interests: These represent the portion of equity ownership in subsidiaries not attributable to Macquarie. As this is not a position that
Macquarie is required to fund, it is netted against the consolidated assets and liabilities in preparing the funded balance sheet.
Securitised assets and other non-recourse funding: These include assets funded by third party debt with no recourse to Macquarie beyond the
borrowing entity and lending assets (mortgages and leasing) sold down into external securitisation entities.
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