MQG - Macquarie Group

Macquarie Bank up to its usual dirty tricks.

heraldsun.com.au
George Lekakis
May 29, 2008 12:00am

Macquarie's big blue

MACQUARIE Bank is hoping it can grab thousands of dollars from up to 1000 borrowers set to refinance their home loans with rival lenders.

In an embarrassing move, Macquarie's mortgage arm has told borrowers that "errors" were made in the wording of their official loan contracts signed since 2005.

Macquarie has written to the affected customers in a bid to change contractual terms so that it can levy fees to recover mortgage insurance from borrowers about to refinance their loans.

Macquarie has been hit with a wave of refinancings in the past two months after it hiked rates on most of its home loan products above 10 per cent.

"When clients take out loans with us they're told verbally that we will absorb their lender's mortgage insurance if they don't discharge the loan within three years," she said.

"These letters are a correction because this condition was not included in the loan agreements.

"It's not changing the contract because all we're doing is correcting something that was obviously an error."

http://www.news.com.au/heraldsun/story/0,21985,23775094-664,00.html

Macquarie Asks European Central Bank for Repo Eligibility on Asset-Backed Bonds
By Laura Cochrane

June 4 (Bloomberg) -- Macquarie Group Ltd., Australia's biggest investment bank, has asked the European Central Bank to accept as much as $1.1 billion of asset-backed bonds it plans to sell in Europe this week as collateral for lending agreements.

Macquarie would become the first bank to sell bonds secured by loans to consumers in Australia that are eligible for repurchase agreements, or repos, with the ECB, said Adrian Bentley, head of debt finance at Macquarie. Repos allow buyers of the debt to swap the securities with the central bank in exchange for cash, giving them access to cheaper funding.

Macquarie last week increased the planned sale of bonds by 85 percent to A$1.2 billion ($1.15 billion). It will be Australia's biggest issue of debt secured by property, auto or consumer loans since June 21 last year when St George Bank Ltd. raised more than A$2 billion selling mortgage-backed bonds.

http://www.bloomberg.com/apps/news?pid=20601080&sid=aIUR12i67Jy4&refer=asia

Is there such a thing as "sub-prime" bonds ?

Macquack said:

Is there such a thing as "sub-prime" bonds ?

Click to expand...

"Junk" bonds could probably be considered sub prime.

Hell even micro cap shares (or some larger ones!) could be considered below prime/good, which is essentially all sub prime means

You've got to love volatility in a market. Jumped into MQG on Wed this week, jumped back out just on close Fri. Easiest 8% I've made this week. There do seem to be a number of opportunities around like this at the moment without having to dip into the spec end of town.

Come to think about it, might start a new forum on this - could be interesting, stay tuned....

What is MacGrab up to now?

Macquarie finds $1b under nose
Stuart Washington
June 10, 2008

MACQUARIE GROUP just found a cool $1 billion under its bed to address the high price of debt - or actually, under the beds of pensioners and superannuation investors.

With little fuss, Macquarie has converted the cash accounts of investors in its super manager and pension manager "wrap" investment products into deposits in Macquarie Bank.

Investors with a total of $1 billion in cash accounts have been given little choice in the matter: the switch occurred in May whether or not the investors wanted to make the move.

Or, as Macquarie told its investors in a leaflet about the change: "No action is required from you."
Investors have been swapped from the AAA-rated Macquarie Treasury Fund - which invests in a variety of money market products - into a deposit with Macquarie Group's banking division, which is rated two notches lower at A-1.

Investors have to deliberately opt out of the move by switching their cash into another cash fund if they do not want to become a depositor with the bank. Even then, they will have to maintain a minimum of $2500 in the cash account as a deposit in Macquarie, as part of their participation in the "wrap" investment platform.

For a bank, more deposits are a bonus because they are a cheaper source of funding than is available on the wholesale debt-funding market.

As a result of the liquidity crisis, the amount a bank pays for its wholesale funding has grown dramatically, with banks paying up to 2 percentage points more than before the crisis pushed up prices.

The official line on the switch is that the trustee, Macquarie Investment Management, found an opportunity for a 0.2 percentage point increase in investor returns for the cash account of the superannuation and pension products.

"It's the trustee deciding to get a better return for clients," Macquarie's head of product, Tony Graham, said.

Macquarie Group will not receive more fees from the change.

Australian depositors are protected by strict regulations. But a product disclosure statement notes a deposit in Macquarie is not diversified among a number of products, as was the case with the Macquarie Treasury Fund.

"It is a concentrated investment in a single asset, being a deposit with Macquarie Bank," it says.


Looks like the MAC Truck is running out of fuel.

Directors defend Macquarie valuations

http://business.theage.com.au/directors-defend-macquarie-valuations-20080610-2okw.html

What goes up must never come down.

Telstra and Macquarie Bank unite in broadband network bid
June 21, 2008
http://www.news.com.au/heraldsun/story/0,21985,23896810-664,00.html

MACQUARIE Group has withdrawn its bid for the Rudd Government's national broadband network tender, leaving it with only two contenders for the $12 billion project. Telstra and the Optus-led consortium Terria (formerly G9) are the remaining bidders prepared to pursue the project on a national scale.

Now Telstra and Macquarie have announced they will join forces in a bid with Macquarie Capital Advisers acting as financial adviser to Telstra.

Macquarie is finally realising that it is not an expert in every industry on earth.
Easier to leave it to the experts and just concentrate on counting the beans.

Correct me if im mistaken but didnt Mac try to take over PCCW 3 years ago. From memory it was an unsavory deal.


http://www.penews.com/today/index/content/2451244036

US buyout groups drawn to PCCW sell off
Nisha Gopalan and Lorraine Luk, The Wall Street Journal
15 Jul 2008
PCCW is seeking around US$2.5bn (€1.6bn) for a 45% stake in its HKT Group Holdings unit and has received interest from several US private-equity firms, people familiar with the deal said Monday.

TPG Capital and Providence Equity Partners are the front-runners for HKT Group, which combines PCCW's telecommunications, media and information-technology operations, these people said. "There are many bidders for the stake, but Providence and TPG are the most serious," one person said. "They're the ones who are likely to have bid the highest."

Australia's Macquarie Bank, Kohlberg Kravis Roberts and Blackstone Group also have expressed interest, the people familiar with the situation said.

UBS, PCCW's financial adviser, said it had received a number of proposals as of the deadline Monday. UBS declined to name the bidders.

Officials at PCCW, Providence, Macquarie and KKR declined to comment. Representatives from TPG and Blackstone weren't immediately available for comment.

Another person familiar with the situation said there will be a second round of bids due in early August.

PCCW in May said it would form HKT Group to improve operating efficiency and facilitate a listing. PCCW intends to retain at least a 55% stake in HKT.

PCCW chairman Richard Li in 2006 received offers from private-equity firm TPG-Newbridge and Macquarie to buy PCCW's main telecommunications and media assets. But staunch resistance from PCCW's second-largest shareholder – state-owned China Network Communications Group – stemming from Beijing's concerns that the Hong Kong telecom firm would fall into foreign hands, led Li to abandon the deal.

PCCW shares ended down 1.2% at 4.87 Hong Kong dollars (62 US cents) on the Hong Kong stock exchange Monday.

Daiwa analyst Marvin Lo said the stake sale should provide a short-term boost for PCCW's shares but won't change the company's fundamentals. "Investors need to know more about how PCCW will use the sale proceeds. I feel that PCCW has identified some new business targets in overseas markets, but the company declined to give details." Lo has a "hold" rating on the stock with a target price of HK$4.67.

PCCW said in June it plans to use proceeds from the sale to repay existing debt. According to the company's annual report, PCCW's net debt totaled HK$21.99bn (US$2.82bn) at the end of 2007.

The Wall Street Journal is owned by Dow Jones, which is also the parent company of Private Equity News.

By Denny Thomas

July 23, 2008 01:47pm

MACQUARIE shares have jumped 10 per cent in their biggest one-day rise in nearly four months after the company said it had a solid start to the 2009 fiscal year, allaying worries about its business model.

Macquarie (mqg.ASX:Quote,News), which manages about $232 billion in infrastructure and real estate assets globally, added a note of caution saying it would struggle to repeat last year's record performance, placing it on course for a first profit drop in 17 years.

Macquarie, like other global investment banks, has suffered from slower deal flows amid a global credit crunch, while volatile equity markets have forced many businesses to shelve capital raising plans, denting Macquarie's revenue growth.

Macquarie shares rose as much as 10.1 per cent to $51.31 in morning trading, but are still well below the share's high of $98.64 in May 2007.

"They are still doing better than all their peers ... the longer term investment proposition in Macquarie hasn't changed," said Donald Williams, a fund manager with Platypus Asset Management, which manages $1.6 billion, including Macquarie shares.

"They are still performing exceptionally well given the environment relative to other investment banks," he added.

In a statement ahead of its annual shareholders meeting on Wednesday, Macquarie said its April-June profit was below the year-ago quarter.

Macquarie had liquid assets worth about $20.3 billion at the end of June, nearly three times those in March, to benefit from any opportunities arising from the challenging environment. It also had about $3.6 billion in excess capital, above the regulatory requirement.

Macquarie scooped up distressed assets in the wake of the last financial crisis that hit Asia in the late 1990s, buying ING's Asian equities business in 2004 and BT Australia in 1999.

Analysts forecast Macquarie's net profit will drop 6 per cent to $1.69 billion in the year to March 2009.

Attractive valuations

Still, it has fared relatively well compared to the hefty losses announced by several Wall Street banks due to their exposure to subprime mortgages.

Shares in Macquarie's smaller local rivals Babcock & Brown and Allco Finance Group have been hit hard by concerns about high debt levels. Both Babcock and Allco have been forced to sell assets to lower their gearing.

Macquarie's AGM is the first under new CEO Nicholas Moore, who took charge in May replacing Allan Moss, who had led the company for 15 years.

Despite today's gains, Macquarie shares are down about 34 per cent so far this year, exceeding a 20 per cent fall in the benchmark index.

Anyone got some news on why this fell thru 52 weeks lows this morning? Looks like a good price for this stock for what it's been trading, but is something wrong i can't find? Or is it just the markets?

Really getting smashed at present down almost 10%,just waiting to jump in no news anywhere for reason

Only thing i can see is when i went to place an order it i was warned it is trading ex-div. I think also some stop losses may have been triggered.

This was the last dividend right ?
Final 200.00 100 26 May, 08 04 Jul, 08

Looks like its come up from $41.6 now.

I did a knee-jerk buy without considering why it would drop, I remember there was a drop in Investment Banks on Monday in the US, is this a delayed reaction ? Or is this more to do with drops in profit from some of their big funds ?

Either I got lucky, or there's something else we don't know.

I remember a few Aussie companies getting burned with Hong Kong Teleco's before. It's not a done deal with MQG and PCCW anyway, so maybe an overreaction there.

News just in from our financial planner is that macquarie has exposure to 400 billion dollars worth of loans that are propping up the US banks at the moment something the do with china. will keep you posted if more news comes my way.


I hold MQG and will continue to hold.

Trickett, please quote your source otherwise your post will be removed as it cannot be verified and is considered ramping/downramping.

thanks

Prawn

Just read on commsecs lunch time report UBS had downgraded its price forecast from $60 to $48. They're expecting writedowns on a lot of MQG assets.

=TRICKETT;328281

I hold MQG and will continue to hold.

Click to expand...

Will you? Even if MQG were to go the way of BNB? Would you be like the thousands of people who have watched their capital dwindle as the SP dropped?
I'm not suggesting this will happen, but I'm just curious that anyone would make such a categorical statement after the failures we've seen recently.

When do we find out about these supposed 'asset' writedowns?

They should never be allowed to publish something like that until they have evidence.

It's doctoring the market IMO. There was a lot of heavy selling on Monday and yesterday, before this news was announced, so i wonder...

Aussiest said:

When do we find out about these supposed 'asset writedowns'?

Sometimes i wonder about all these warnings... Perhaps someone is short selling?

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I just wonder about the credibility of the post from TRICKETT (just arrived from Beijing?). On the one hand he/she inspires concern over an alleged 400 billion of risky loans that MQH has exposure to, and on the other he/she says will continue to hold.

The post doesn't make much sense at all.