Fixed Income, Currencies and Commodities

Group contribution to profit based on internal management accounts before tax, profit share, share-based payments and the corporate segment Full year to 31 March 2012: 27 per cent Full year to 31 March 2011: 25 per cent

Staff: 949 (at 31 March 2012)

Activities: Fixed Income, Currencies and Commodities (FICC) provides a variety of trading, risk management, sales, structuring, financing, and market analysis and strategy services across the globe with an underlying specialisation in interest rate, commodity or foreign exchange-related institutional trading, marketing, lending, clearing or platform provision.

Staff locations: Australia, Brazil, Canada, China, Hong Kong, India, Indonesia, Japan, Singapore, South Korea, Switzerland, the UAE, the UK and the US.

Fixed Income, Currencies and Commodities (FICC) comprises the following divisions:

Asian Markets

Asian Markets, which was established in 2010 and is headquartered in Singapore, is predominantly a corporate and institutional investor facing business focused on offering Asian currencies (spot, forwards, non-deliverable forwards), corporate debt (local currency and G3, private debt, credit default swaps, credit linked notes) and sovereign debt (interest rate swaps, options, cross currency swaps, structured products) trading, and risk management services. Asian Markets has staff based in Singapore, Hong Kong, Seoul and Mumbai.

Credit Trading

Credit Trading operates primarily in the United States via its team based in New York, with additional presences in London and Sydney. Credit Trading facilitates client transactions with institutional investors and makes markets in corporate debt securities, credit default swaps, syndicated bank loans, collateralised debt obligations, asset-backed and mortgage-backed securities and derivatives of these products. Credit Trading focuses on the high-yield and distressed sectors and to compliment this focus, its US activities include commercial mortgage finance and commercial mortgage backed securities. Other industry specialties include healthcare, consumer/retail, energy/utilities, gaming/leisure, commodities/metals, infrastructure/transportation and media/telecommunications.

Energy Markets

Energy Markets operates in London, Geneva, Sydney, Melbourne, Houston, Calgary, New York, Singapore, Jakarta, Seoul and Tokyo providing products and solutions to a broad customer base across the energy sector. Traded energy products include renewables, power, liquefied natural gas (LNG), natural gas and natural gas liquids, and crude oil and refined products (including physical oil, LNG and coal). Energy Markets also provides storage and transportation services, and commodities based financing. Energy Markets serves clients and market participants including producers, refiners, large industrials, airlines, utilities, shipping companies, wholesale marketers and aggregators. The division is also active in physical and financial gas and electricity trading in North America through its subsidiary, Macquarie Energy. Macquarie Energy is ranked the number four physical gas marketer in North America¹. Energy Markets offers energy services in Europe through the utility services business, providing power and gas services in select European markets.

Fixed Income and Currencies

Fixed Income and Currencies, with staff based in Sydney, Melbourne, Singapore, Tokyo, Hong Kong, London, and New York, provides currencies and fixed income trading and hedging services to a range of corporate and institutional clients globally. The business offers 24-hour price making in all major currency pairs as well as offering structured solutions and risk management hedging services. Additionally, it offers retail and wholesale currency delivery and technology platforms. In fixed income markets, Fixed Income and Currencies arranges and places primary debt for clients and provides secondary market liquidity in Australian government, semi-government fixed income and inflation linked bond markets, as well as issuance activities and interest rate risk management services via structured solutions and derivative based products.

Futures

Futures provides a full range of broking and clearing services to corporate and institutional clients with access to most major exchanges and memberships of many. Futures also provides futures services to other divisions within Fixed Income, Currencies and Commodities. Futures offers broking (telephone and electronic) and clearing services and makes extensive use of proprietary technology to provide clients customised execution and clearing solutions, including direct market access and straight through processing. Futures operates from offices in Sydney, Melbourne, Brisbane, London, New York, Chicago, Montreal, Hong Kong and Mumbai.

Metals & Agriculture Sales and Trading

In November 2011 FICC merged its sales and trading activities in metals and agricultural commodities into one Division called Metals & Agriculture Sales and Trading. Metals & Agriculture Sales and Trading has staff in London, Geneva, New York, Sao Paulo, Ribeirao Preto, Singapore, Hong Kong, Sydney and Melbourne providing corporate and institutional clients with trading, risk management and selected physical supply solutions. Metals related risk management trading and hedging services are provided via 24-hour trading and price-making services in industrial metals, bulk metals and precious metals. The agricultural offering includes grain, sugar, coffee, cocoa, soybean complex, rapeseed/canola, palm oil, ethanol, dairy products, livestock and meat, and pulp and paper. Dry freight services include bespoke risk management solutions to ship owners, charterers and operators across all major vessel sizes.

Metals and Energy Capital

Metals and Energy Capital operates in Sydney, Perth, Tokyo, London, Houston, Calgary, Toronto and Vancouver providing financing, equity capital and price risk management to producers across the metals and upstream oil and gas space globally. Metals and Energy Capital targets opportunities in the $US5 million to $US150 million range and provides a wide range of equity and debt facilities at the corporate and project level. The Division includes in-house industry experts, such as geologists, petroleum and mining engineers. Metals producer related risk management trading and hedging services are provided via 24-hour trading and price-making services in precious, base, industrial and bulk metals in combination with the Metals & Agriculture Sales and Trading division. Macquarie is an Associate Broker Clearing Member of the London Metal Exchange, a Clearing Member of the London Clearing House and an Ordinary Member of the London Bullion Market Association.

Central

Central fosters and develops various non-division specific, early stage or cross-divisional initiatives as well as housing various FICC-wide services including:

• Environmental Financial Products, which is active in originating/structuring emission reduction credits from projects in China and Russia under the Kyoto Clean Development Mechanism and Joint Implementation, and distributing these credits to compliance buyers in Europe, Australia, New Zealand and Japan. Environmental Financial Products’ dedicated, environmental professionals are located in Sydney, London, Hong Kong and Beijing, offering trading and client services with the benefit of knowledge and experience located at the project source;
• Structured Commodity Finance, which offers services across agriculture, energy and metals including revolving, working capital facilities secured by exchange traded commodities and also provides repurchase-style physical transactions. Additionally, Structured Commodity Finance provides mezzanine debt, structured facilities or transactions in conjunction with other FICC divisions;
• new jurisdictions and branch initiatives; and
• joint-ventures and alliances.

¹ Platts (Dec 2011)