REG - Macquarie Group Ltd - Publication of a Prospectus <Origin Href="QuoteRef">MQG.AX</Origin> - Part 2
15/06/2016 07:05
- Part 2: For the preceding part double click ID:nRSO2097Ba
which it operates [Not Applicable - There are no known trends, affecting the Issuer and the industries in which it operates.]
B.5 The Issuer's group MGL is the ultimate holding company for all other companies and entities within the Macquarie Group including, but not limited
to, MBL.
B.9 Profit forecast or estimate Not Applicable - No profit forecasts or estimates have been made in the Base Prospectus.
B.10 Audit report qualifications Not Applicable - No qualifications are contained in any audit report included in the Base Prospectus.
B.12 Selected historical key financial information of the Issuer, no material adverse change statement and description of significant changes in financial or trading position of the Issuer Selected historical key financial information from Income Statements Consol.
2016A$m Consol.
2015A$m MGL.
2016A$m MGL.
2015A$m Net interest income/(expense) 2,279 2,092 86 (3) Net operating income 10,135 9,262 4,428 2,617 Total operating expenses
(7,120) (6,740) (10) (4) Operating profit before income tax 3,015 2,522 4,418 2,613 Income tax (expense)/benefit (927) (899)
(39) (32) Profit after income tax 2,088 1,623 4,379 2,581 (Profit)/loss attributable to non-controlling interests: Macquarie
Income Securities (16) (18) Macquarie Income Preferred Securities (1) (5) Other non-controlling interests (8) 4 Profit
attributable to non-controlling interests (25) (19) - - Profit attributable to ordinary equity holders of Macquarie Group
Limited 2,063 1,604 4,379 2,581 Selected historical key financial information from Statements of Financial Position Consol.
2016A$m Consol.
2015A$m MGL.
2016A$m MGL.
2015A$m Totalassets 196,755 187,976 31,302 26,429 LIABILITIES Total liabilities excluding loan capital 175,882 169,196 10,346
9,641 Total loan capital 5,209 4,384 1,126 603 Total liabilities 181,091 173,580 11,472 10,244 Net assets 15,664 14,396 19,830
16,185
EQUITY Total capital and reserves attributable to ordinary equity holders of Macquarie Group
Limited 15,116 13,909 19,830 16,185 Non-controlling interests 548 487 - - Total equity 15,664 14,396 19,830 16,185 [The
financial information above is selected historical key financial information of MGL consolidated with its controlled
entities.][There has been no significant change in the financial or trading position of MGL or the Macquarie Group since [31
March 2016], and no material adverse change in the financial position or prospects of MGL or the Macquarie Group since [31 March
2016], being the date as at which the latest published audited financial statements of MGL consolidated with its controlled
entities were made up.]
B.13 Recent events material to the evaluation of the Issuer's solvency Not Applicable - There are no recent events particular to MGL which are to a material extent relevant to the evaluation of the
Issuer's solvency.
B.14 Dependence upon other members of the Issuer's group Not Applicable - MGL is not financially dependent upon other entities within the Macquarie Group.
B.15 Principal activities MGL is a diversified financial services holding company listed on the Australian Securities Exchange operated by ASX Limited
("ASX"), headquartered in Sydney, Australia and regulated as a non-operating holding company of an "authorised deposit-taking
institution" ("ADI") by the Australian Prudential Regulation Authority ("APRA"). The Macquarie Group provides banking,
financial, advisory, investment and funds management services through client driven businesses which generate income by
providing a diversified range of services to clients. The Macquarie Group acts on behalf of institutional, corporate and retail
clients and counterparties around the world.
B.16 Ownership and control As at 31 March 2016, MGL had on issue 340,302,389 fully paid ordinary shares. The ordinary shares of MGL are listed in Australia
on the ASX.As at the date of this Base Prospectus, MGL is neither directly nor indirectly controlled by any of its shareholders.
B.17 Credit Ratings Standard and Poor's (Australia) Pty Ltd has assigned MGL a credit rating for long-term unsubordinated unsecured obligations of
"BBB". The outlook for the rating is stable.Moody's Investors Service Pty Limited has assigned MGL a credit rating for long
-term unsubordinated unsecured obligations of "A3". The outlook for the rating is stable.Fitch Australia Pty Ltd has assigned
MGL a credit rating for long-term unsubordinated unsecured obligations of "A-". The outlook for the rating is stable.Issue
specific summary:[The PD Debt Instruments [have been/are expected to be] rated ● by ● . A security rating is not a
recommendation to buy, sell or hold securities and may be subject to suspension, cancellation, reduction or withdrawal at any
time by the assigning rating agency. Each rating should be evaluated independently of any other rating.][Not Applicable - No
ratings have been assigned to the Issuer or its debt securities at the request of or with the co-operation of the Issuer in the
rating process.]
(4)
Operating profit before income tax
3,015
2,522
4,418
2,613
Income tax (expense)/benefit
(927)
(899)
(39)
(32)
Profit after income tax
2,088
1,623
4,379
2,581
(Profit)/loss attributable to non-controlling interests:
Macquarie Income Securities
(16)
(18)
Macquarie Income Preferred Securities
(1)
(5)
Other non-controlling interests
(8)
4
Profit attributable to non-controlling interests
(25)
(19)
-
-
Profit attributable to ordinary equity holders of Macquarie Group Limited
2,063
1,604
4,379
2,581
Selected historical key financial information from Statements of Financial Position
Consol. Consol. MGL. MGL.
2016A$m 2015A$m 2016A$m 2015A$m
Totalassets 196,755 187,976 31,302 26,429
LIABILITIES
Total liabilities excluding loan capital 175,882 169,196 10,346 9,641
Total loan capital 5,209 4,384 1,126 603
Total liabilities 181,091 173,580 11,472 10,244
Net assets 15,664 14,396 19,830 16,185
EQUITY
Total capital and reserves attributable to ordinary equity holders of Macquarie Group 15,116 13,909 19,830 16,185
Limited
Non-controlling interests 548 487 - -
Total equity 15,664 14,396 19,830 16,185
[The financial information above is selected historical key financial information of MGL consolidated with its controlled
entities.][There has been no significant change in the financial or trading position of MGL or the Macquarie Group since
[31 March 2016], and no material adverse change in the financial position or prospects of MGL or the Macquarie Group since
[31 March 2016], being the date as at which the latest published audited financial statements of MGL consolidated with its
controlled entities were made up.]
B.13
Recent events material to the evaluation of the Issuer's solvency
Not Applicable - There are no recent events particular to MGL which are to a material extent relevant to the evaluation of
the Issuer's solvency.
B.14
Dependence upon other members of the Issuer's group
Not Applicable - MGL is not financially dependent upon other entities within the Macquarie Group.
B.15
Principal activities
MGL is a diversified financial services holding company listed on the Australian Securities Exchange operated by ASX
Limited ("ASX"), headquartered in Sydney, Australia and regulated as a non-operating holding company of an "authorised
deposit-taking institution" ("ADI") by the Australian Prudential Regulation Authority ("APRA"). The Macquarie Group
provides banking, financial, advisory, investment and funds management services through client driven businesses which
generate income by providing a diversified range of services to clients. The Macquarie Group acts on behalf of
institutional, corporate and retail clients and counterparties around the world.
B.16
Ownership and control
As at 31 March 2016, MGL had on issue 340,302,389 fully paid ordinary shares. The ordinary shares of MGL are listed in
Australia on the ASX.As at the date of this Base Prospectus, MGL is neither directly nor indirectly controlled by any of
its shareholders.
B.17
Credit Ratings
Standard and Poor's (Australia) Pty Ltd has assigned MGL a credit rating for long-term unsubordinated unsecured obligations
of "BBB". The outlook for the rating is stable.Moody's Investors Service Pty Limited has assigned MGL a credit rating for
long-term unsubordinated unsecured obligations of "A3". The outlook for the rating is stable.Fitch Australia Pty Ltd has
assigned MGL a credit rating for long-term unsubordinated unsecured obligations of "A-". The outlook for the rating is
stable.Issue specific summary:[The PD Debt Instruments [have been/are expected to be] rated ● by ● . A security rating
is not a recommendation to buy, sell or hold securities and may be subject to suspension, cancellation, reduction or
withdrawal at any time by the assigning rating agency. Each rating should be evaluated independently of any other
rating.][Not Applicable - No ratings have been assigned to the Issuer or its debt securities at the request of or with the
co-operation of the Issuer in the rating process.]
Section C - PD Debt Instruments
C.1 Type and class of PD Debt Instruments including security identification number The PD Debt Instruments to be issued under the Programme may be a Fixed Rate PD Debt Instrument, a Floating Rate PD Debt
Instrument, a Fixed/Floating Interest Rate Basis PD Debt Instrument, a Zero Coupon PD Debt Instrument or a combination of the
foregoing. Issue specific summary:The PD Debt Instruments are [U.S.$ / A$ / £ / Yen / HKD / E / RMB / other] ● ● per
cent./Floating Rate / "Fixed / Floating"/Zero Coupon] PD Debt Instruments due ● .International Securities Identification Number
("ISIN"): ●
C.2 Currency Subject to compliance with all applicable laws, regulations and directives, PD Debt Instruments may be issued in any currency
agreed between the Issuer and the relevant Dealer at the time of issue.Issue specific summary:The currency of this Series of PD
Debt Instruments is [U.S. Dollars (U.S.$) / Australian Dollars (A$) / Pounds Sterling (£) / Yen / Hong Kong Dollars (HKD) / Euro
(E) / Renminbi (RMB) / ● (" ● ")].
C.5 Restrictions on free transferability Not Applicable - There are no restrictions on the free transferability of the PD Debt Instruments.The offering, sale, delivery
and transfer of PD Debt Instruments and the distribution of this Base Prospectus and other material in relation to any PD Debt
Instruments are subject to restrictions as may apply in any country in connection with the offering and sale of a particular
Tranche of PD Debt Instruments including, in particular, restrictions in Australia, the United States, the European Economic
Area, the United Kingdom, Hong Kong, Singapore, Japan, Korea, India, Canada, the PRC, Malaysia, Mexico and Taiwan.
C.8 Rights attached to the PD Debt Instruments, including ranking and any limitations on those rights PD Debt Instruments issued under the Programme will have terms and conditions relating to, among other matters:StatusPD Debt
Instruments will constitute direct and (subject to the provisions of the Issuer's negative pledge below) unsecured obligations
of the Issuer and will rank pari passu without any preference among themselves and at least equally with all other unsecured and
unsubordinated creditors (except creditors mandatorily preferred by law) of the Issuer, from time to time
outstanding.TaxationAll payments in respect of PD Debt Instruments will be made without withholding or deduction for, or on
account of, any present or future taxes, duties, assessments or governmental charges of whatever nature imposed by or on behalf
of Australia or Victoria, unless such withholding or deduction is required by law or is made for or on account of FATCA (as
defined in the Conditions). In the event that any such withholding or deduction is made, the Issuer will, save in certain
limited circumstances which include, without limitation, a deduction made for or on account of FATCA, be required to pay
additional amounts to cover the amounts so withheld or deducted.Negative pledgeThe terms of the PD Debt Instruments will contain
a negative pledge provision which prevents the Issuer, whilst there are any PD Debt Instruments outstanding, from creating or
permitting to subsist any mortgage, charge, pledge, lien or other form of encumbrance or security interest ("Security Interest")
upon the whole or any part of its present or future assets or revenues as security for any relevant indebtedness, guarantee or
indemnity unless (i) the Issuer grants such Security Interest that will result in its obligations under the PD Debt Instruments
being secured equally and rateably in all respects so as to rank equally with all applicable relevant indebtedness or guarantee
or (ii) the granting of such Security Interest has been approved by a resolution of a specified proportion of PD Debt Instrument
Holders.Events of defaultThe terms of the PD Debt Instruments will contain, amongst others, the following events of default:(i)
default in payment of any principal or interest due in respect of the PD Debt Instruments, continuing for a specified
period of time;(ii) non-performance or non-observance by the Issuer of any of its other obligations under the
conditions of the PD Debt Instruments, continuing for a specified period of time; and(iii) events relating to the
insolvency or winding up of the Issuer.If any event of default occurs and is continuing then any PD Debt Instruments will become
immediately due and payable, either upon declaration by a holder of PD Debt Instruments ("PD Debt Instrument
Holder")individually or by declaration made by not less than 25% of holders of PD Debt Instruments of that Series (as applicable
for the specific event).Cross defaultThe PD Debt Instruments are not subject to a cross default provision. Therefore a default
under any of the Issuer's other financing arrangements will not trigger an event of default under the PD Debt
Instruments.MeetingsThe terms of the PD Debt Instruments will contain provisions for calling meetings of PD Debt Instrument
Holders to consider matters affecting their interests generally. These provisions permit defined majorities to bind all PD Debt
Instrument Holders, including PD Debt Instrument Holders who did not attend and vote at the relevant meeting and holders who
voted in a manner contrary to the majority.Governing law[English law/The laws of New South Wales].
C.9 Rights attached to the PD Debt Instruments including ranking and any limitation to those rights, details of the interest payable, indication of yield and representative of holders InterestPD Debt Instruments may or may not bear interest. Interest-bearing PD Debt Instruments will either bear interest
payable at a fixed rate or a floating rate. Issue specific summary:[The PD Debt Instruments bear interest [from their date of
issue/from ● ] at the fixed rate of ● per cent. per annum. The yield of the PD Debt Instruments is ● per cent. Interest
will be paid annually in arrear on ● in each year. The first interest payment will be made on ● ].[The PD Debt Instruments
bear interest [from their date of issue/from ● ] at floating rates calculated by reference to [LIBOR / EURIBOR / BBSW / BKBM /
HIBOR / BA-CDOR / SIBOR] plus/minus a margin of ● per cent. Interest will be paid semi-annually in arrear on ● and ●
in each year, subject to adjustment for non-business days. The first interest payment will be made on ● .]
[The PD Debt Instruments do not bear any interest [and will be offered and sold at a discount to their nominal amount].][The
yield for the Fixed Rate PD Debt Instruments will be ● on the Issue Date and will be calculated on the basis of the compound
annual rate of return if the relevant Fixed Rate PD Debt Instruments were to be purchased at the Issue Price on the Issue Date
and held to maturity. This is not an indication of future yield.]RedemptionThe terms under which PD Debt Instruments may be
redeemed (including the maturity date and the price at which they will be redeemed on the maturity date as well as any
provisions relating to early redemption) will be agreed between the Issuer and the relevant Dealer at the time of issue of the
relevant PD Debt Instruments.Issue specific summary:Subject to any purchase and cancellation or early redemption, the PD Debt
Instruments will be redeemed on ● at ● per cent. of their nominal amount. The PD Debt Instruments may be redeemed early for
tax reasons [or ● ] at ● .Maturity date and arrangements for the amortisation of the PD Debt Instruments, including the
repayment procedures: ● No representative of the PD Debt Instrument Holders has been appointed by the Issuer.
C.10 Rights attached to the PD Debt Instruments including ranking, any limitation to those rights, details of the interest payable, indication of yield, representative of holders and effect of underlying instrument on the value of the investment Not applicable - There is no derivative component in the interest payments.
C.11 Admission to trading Application has been made for each series of PD Debt Instruments issued during the period of 12 months from the date of the Base
Prospectus to be admitted to the Official List of the UK Listing Authority and admitted to trading on the London Stock
Exchange's Regulated Market.
C.11
Admission to trading
Application has been made for each series of PD Debt Instruments issued during the period of 12 months from the date of the
Base Prospectus to be admitted to the Official List of the UK Listing Authority and admitted to trading on the London Stock
Exchange's Regulated Market.
Section D - Risks
D.2 Key risks that are specific to the Issuer The following are the key risks relating to the Issuer: Economic RiskMGL's and the Macquarie Group's business and financial
condition has been and may be negatively impacted by adverse global credit and other market conditions. Economic conditions,
particularly in Australia, the United States, Europe and Asia, may have a negative impact on MGL's and the Macquarie Group's
business and financial condition.Market RiskMGL's and the Macquarie Group's businesses may be impacted by fluctuations in short
-term and long-term interest rates, inflation, monetary supply, commodities, foreign exchange rates and equity prices in the
markets in which MGL and the Macquarie Group operate.Funding RiskMGL and the Macquarie Group rely on equity and debt markets for
funding their businesses. Further instability in these markets may affect MGL's and the Macquarie Group's ability to access
funding, particularly the ability to issue long-term debt securities, to replace maturing liabilities in a timely manner and to
access the funding necessary to grow their businesses. In addition, an increase in credit spreads may increase MGL's and the
Macquarie Group's cost of funding. Liquidity RiskMGL and the Macquarie Group are exposed to the risk that they may become
unable to meet their financial commitments when they fall due, which could arise due to mismatches in cashflows. Liquidity is
essential to MGL's and the Macquarie Group's businesses. Liquidity could be impaired by an inability to access credit and debt
markets, an inability to sell assets or unforeseen outflows of cash or collateral.Regulatory RiskGlobal economic conditions have
led to changes that significantly alter the regulatory framework in which MGL and the Macquarie Group operate. Failure to
comply with legal and regulatory requirements, including tax laws and regulations, and rules relating to conflicts of interest,
corrupt and illegal payments and money laundering, or government policies in a timely manner, may have an adverse effect on
their reputation among customers and regulators in the market. There is also increased scrutiny from regulators, legislative
bodies and law enforcement agencies with respect to matters relating to the financial services sector generally.Credit Rating
RiskCertain Macquarie Group entities are assigned credit ratings based on an evaluation of a number of factors. If one or more
of these credit ratings are downgraded this could have the effect of increasing the cost of funds raised by MGL or the Macquarie
Group from financial markets, reducing MGL's or the Macquarie Group's ability to access certain capital markets, triggering
MGL's or the Macquarie Group's obligations under certain contracts, and/or adversely impacting the willingness of counterparties
to deal with MGL or the Macquarie Group.If any of the risks described in this section actually occur, the businesses,
competitive position, financial performance, financial condition, operations, prospects or reputation of MGL, as well as other
entities within the Macquarie Group, could be materially and adversely affected, with the result that the value, trading price
and/or liquidity of MGL's equity and debt securities (including the PD Debt Instruments) could decline, and investors could lose
all or part of their investment.
D.3 Key risks that are specific to the PD Debt Instruments The following are the key risks relating to the PD Debt Instruments:Majority decisionsThe conditions of the PD Debt Instruments
contain provisions for calling meetings of PD Debt Instrument Holders to consider matters affecting their interests generally.
These provisions permit defined majorities to bind all PD Debt Instrument Holders including holders who did not attend and vote
at the relevant meeting and PD Debt Instrument Holders who voted in a matter contrary to the majority.Withholdings and or
deductionsThe PD Debt Instrument Holder may not receive payment of the full amounts due in respect of the PD Debt Instruments as
a result of amounts being withheld by MGL in order to comply with applicable law.IlliquidityPD Debt Instruments may have no
established trading market when issued, and one may never develop, or may be illiquid. In such case, investors may not be able
to sell their PD Debt Instruments easily or at favourable prices.Change in lawInvestors are exposed to the risk of changes in
law or regulation affecting the value of the PD Debt Instruments held by them.Issue-specific Summary:[An investment in fixed
rate PD Debt Instruments involves the risk that subsequent changes in market interest rates may adversely affect the value of
the fixed rate PD Debt Instruments and the interest paid under the fixed rate PD Debt Instruments will be less than the then
applicable market interest rate.]If any of the risks described in this section actually occur, the value, trading price and/or
liquidity of the PD Debt Instruments could decline, and investors could lose all or part of their investment.
D.3
Key risks that are specific to the PD Debt Instruments
The following are the key risks relating to the PD Debt Instruments:Majority decisionsThe conditions of the PD Debt
Instruments contain provisions for calling meetings of PD Debt Instrument Holders to consider matters affecting their
interests generally. These provisions permit defined majorities to bind all PD Debt Instrument Holders including holders
who did not attend and vote at the relevant meeting and PD Debt Instrument Holders who voted in a matter contrary to the
majority.Withholdings and or deductionsThe PD Debt Instrument Holder may not receive payment of the full amounts due in
respect of the PD Debt Instruments as a result of amounts being withheld by MGL in order to comply with applicable
law.IlliquidityPD Debt Instruments may have no established trading market when issued, and one may never develop, or may be
illiquid. In such case, investors may not be able to sell their PD Debt Instruments easily or at favourable prices.Change
in lawInvestors are exposed to the risk of changes in law or regulation affecting the value of the PD Debt Instruments held
by them.Issue-specific Summary:[An investment in fixed rate PD Debt Instruments involves the risk that subsequent changes
in market interest rates may adversely affect the value of the fixed rate PD Debt Instruments and the interest paid under
the fixed rate PD Debt Instruments will be less than the then applicable market interest rate.]If any of the risks
described in this section actually occur, the value, trading price and/or liquidity of the PD Debt Instruments could
decline, and investors could lose all or part of their investment.
Section E - Offer
E.2b Reasons for the offer and use of proceeds The proceeds realised from the issuance of PD Debt Instruments under the Programme will be used by MGL for the Macquarie Group's
general corporate purposes.
E.3 Terms and conditions of the offer Under the Programme, the PD Debt Instruments may be offered to the public in a Public Offer in ● .The terms and conditions of
each offer of PD Debt Instruments will be determined by agreement between the Issuer and the relevant Dealers at the time of
issue and specified in the applicable Final Terms. An investor intending to acquire or acquiring any PD Debt Instruments in a
Public Offer from an Authorised Offeror will do so, and offers and sales of such PD Debt Instruments to an Investor by such
Authorised Offeror will be made, in accordance with any terms and other arrangements in place between such Authorised Offeror
and such Investor including as to price, allocations and settlement arrangements.Issue specific summary:[This issue of PD Debt
Instruments is being offered in a Public Offer in ● .The issue price of the PD Debt Instruments is ● per cent. of their
nominal amount.Offer Period: ● Conditions of offer:
[Not Applicable / ● ]Application process: [Not Applicable / ● ]Reduction of
subscriptions: [Not Applicable / ● ]Manner for refunding excess [Not Applicable /
● ]amount paid by applicants:Minimum amount of application: [Not Applicable/ ● ]Maximum amount of application:
[Not Applicable/ ● ]Method and time limits [Not Applicable/ ● ]
for paying up and delivering
PD Debt Instruments:Manner in and date on [Not Applicable/ ● ]
which results of the offer
are to be made public:Procedure for exercise of any [Not Applicable/ ● ]
right of pre-emption, negotiability
of subscription rights and treatment
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