Macquarie Group, Australia's top investment bank, on Friday posted a record first-half net profit that jumped 58 percent, helped by higher fee income and better financial market activity.
The Sydney-based bank now expects earnings in the second half-ending March 2016 to be better than A$926 million it posted in the year ago period, pushing annual profit to top A$2 billion, its best financial performance to date.
Macquarie, with its strong earnings growth and stable returns, has become a favorite with investors who are shunning Australia's "big four" lenders on worries their dividend paying ability would take a hit from stringent capital rules and slowing growth.
"The Group remains well positioned, with a strong and diverse global platform and specialist skills across a range of products and asset classes," CEO Nicholas Moore said in a statement on Friday.
"All of this is built on the foundation of a strong balance sheet, surplus capital, a robust liquidity and funding position and a conservative approach to risk management."
Net profit for the first six months to September rose to A$1.07 billion ($757.03 million) compared with A$678 million a year ago and in line with its guidance earlier this month. It announced an interim dividend of $A1.60 per share, down from A$2 a share in the prior period. Net operating income was A$5.3 billion, up 24 percent from a year ago.
A falling Australian dollar also benefited Macquarie, which generates more than 70 percent of its income overseas.
Macquarie will issue new shares at A$78.4 each, a 6.7 percent discount to Thursday's closing price. Earlier this month, it raised A$400 million from institutional investors to help it fund the acquisition of ANZ Banking Group's vehicle finance portfolio.
It will provide further details on the plan on or around Nov.2.
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In contrast to Macquarie's earnings, both National Australia Bank and ANZ Banking Group earlier this week missed expectations on their annual results, sending their shares lower.
Macquarie shares are up 44 percent year-to-date compared with drops of 3-12 percent at the major four banks.