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MACQUARIE GROUP: CAPTURING THE INFRASTRUCTURE PLATFORM OPPORTUNITY

The 2030 Report | CEO Memo | June 2030

FROM: Macro Intelligence Unit TO: CEO, Group Leadership RE: Strategic Acceleration: From Financial Infrastructure to Global Fintech Platform DATE: June 2030 CLASSIFICATION: Confidential - C-Suite

EXECUTIVE SUMMARY FOR LEADERSHIP

Macquarie has emerged as the clear structural winner in the Australian financial services landscape. Your company's infrastructure expertise, fintech platforms, and capital markets franchise position it as the primary beneficiary of the 2029-2032 AI infrastructure boom.

The strategic question is not "how to survive the transformation" but "how to accelerate capture of this opportunity." This memo outlines the leadership imperatives for the next 18-24 months.

THE STRATEGIC OPPORTUNITY: INFRASTRUCTURE AS THE NEW CAPITAL MARKETS

Historically, Macquarie's identity was "investment bank" competing with Goldman Sachs, Morgan Stanley on capital markets. This positioned the company as cyclical and subject to market volatility.

The evolution underway is toward "financial infrastructure platform" —essentially becoming the "Visa/Mastercard" of infrastructure asset management and fintech. This is a more durable, higher-return business model.

The shift is evident in three vectors:

  1. Deposits as the Core Product: Macquarie Savings ($85B deposits) has evolved from "alternative to bank savings account" to "core funding mechanism." These deposits are stickier than wholesale funding and generate superior margins.

  2. Management Fees as the Base Revenue: Data center management, renewable energy fund management, and infrastructure partnership management generate recurring, low-volatility management fees (15-20bps). These are more stable than investment banking fees.

  3. Infrastructure M&A as the Growth Engine: Rather than competing on small M&A mandates, Macquarie can use its capital and infrastructure expertise to:

  4. Advise on transactions
  5. Co-invest in transactions
  6. Manage post-acquisition infrastructure assets

This "advisor + investor + operator" model is more profitable and more defensible than pure advisory.

STRATEGIC INITIATIVE 1: FINTECH PLATFORM ACCELERATION

Current State: - Macquarie Savings: $85B deposits, 8%+ rates - Macquarie Mortgages: 6-7% market share, growing 25-30% annually - Macquarie Invest: $50B AUM, moderate growth

Opportunity: Macquarie can become the "Amazon of Australian Finance" if it moves aggressively to integrate these platforms and expand reach.

Recommended Acceleration:

  1. Deposit Growth Target: $150-180B deposits by FY2033 (from current $85B)
  2. Path: Continue offering competitive rates (7.5-8.5% on term deposits)
  3. Also expand transaction account share (currently weak at <2% market share)
  4. Capex: $100-150M in digital platform enhancement

  5. Expected NIM: 60-80bps (earning spread of 100-120bps on lending, funding at 40-60bps)

  6. Mortgage Growth Target: 10-12% market share by FY2033 (from current 6-7%)

  7. Path: Aggressive broker distribution + digital origination
  8. Capex: $200-250M in mortgage platform build

  9. Expected outcome: $200-250M additional net interest income annually by FY2033

  10. Wealth Platform Expansion: $150-200B AUM by FY2033 (from current $50B)

  11. Path: Acquisition of mid-tier wealth management firms (Australia/NZ)
  12. Capex: $300-400M in acquisition + integration

  13. Expected outcome: $80-120M additional fee income annually

  14. Insurance Integration: Partner or acquire (minority stake) in insurance platform to enable full "open ecosystem"

  15. Path: Fintech insurance aggregator or minority stake in InsurTech
  16. Capex: $50-100M
  17. Expected outcome: Cross-sell opportunity, referral fees

STRATEGIC INITIATIVE 2: DATA CENTER INFRASTRUCTURE DOMINANCE

Current Position: - $195B AUM in infrastructure - ~8-10% of global data center infrastructure exposure - Revenue: ~$1.2B annually from data center management fees + co-investment returns

Opportunity: Become the "Blackstone" of data center infrastructure in Asia-Pacific.

Recommended Strategy:

  1. Dedicated Data Center Fund: Establish $20-30B data center-specific investment fund
  2. Target global LPs (pension funds, sovereign wealth funds, insurance companies)
  3. Target: 12-15% IRR (includes management fees + co-investment returns)

  4. Capex from Macquarie: $2-4B co-investment

  5. Operator Relationships: Deepen relationships with major data center operators (Digital Realty, Equinix, AirTrunk)

  6. Offer financing solutions (debt + equity co-investment)
  7. Offer advisory on expansion strategy

  8. Eventually co-own or manage operating platforms

  9. Vertical Integration: Build Macquarie's own data center operating capabilities

  10. Acquire minority stake in operating platform (AirTrunk or equivalent)
  11. Deploy Macquarie capital alongside operations
  12. Create synergy: Macquarie raises capital, deploys capital, operates assets

Expected Financial Impact: - Management fees: +$600-800M annually by FY2033 - Co-investment returns: +$200-300M annually by FY2033 - Total earnings accretion: +$800M-$1.1B annually by FY2033

STRATEGIC INITIATIVE 3: THE "OPEN ECOSYSTEM" PLATFORM

The biggest strategic opportunity is to position Macquarie as the "infrastructure platform" that enables other fintech to win.

Rather than compete directly with every fintech for customers, Macquarie could: - Provide deposit infrastructure to fintech lenders (earn spread on deposits, avoid credit risk) - Provide lending infrastructure to fintech deposit platforms (earn spread on lending, avoid deposit liability) - Provide investment infrastructure to fintech advisors (earn AUM fees) - Provide payment infrastructure to fintech platforms (earn transaction fees)

Implementation Path:

  1. API-First Architecture: Build Macquarie's core banking and investment infrastructure as APIs that can be white-labeled or embedded in third-party platforms

  2. Example: A fintech savings platform could offer Macquarie mortgages through Macquarie APIs, with Macquarie earning origination fee (2-3%) and servicing fee (10-15bps)

  3. Strategic Partnerships: Identify 5-10 key fintech partners where co-investment or strategic partnership makes sense

  4. Example: Minority stake in promising fintech, with exclusive infrastructure arrangement

  5. Developer Community: Build developer ecosystem around Macquarie APIs

  6. Lower barriers to entry for fintech startups
  7. Capture share of emerging fintech value creation

Expected Financial Impact: - Platform fees from third-party fintech: $150-250M annually by FY2033 - Higher ROE on capital (due to fee model vs. direct lending) - Strategic optionality to acquire successful fintech at reasonable valuations

COMPETITIVE POSITIONING: MACQUARIE VS. TRADITIONAL BANKS

The most dangerous competitor to Macquarie is actually CBA, not other fintech. CBA has 24% deposit share and massive distribution advantage.

Macquarie's Counter-Strategy: - Don't try to beat CBA in consumer deposits (impossible due to scale) - Instead, focus on niche segments: high-savings rate customers, business customers, younger demographics - Offer superior digital experience and rates to attract and retain these segments

Market Positioning: - CBA: "Mass market bank" (everyone has CBA) - Macquarie: "Premium financial platform" (high-savings rate, wealth-building, business customers)

This positioning allows Macquarie to command higher margins despite lower market share.

RISK MANAGEMENT: THE CRITICAL CONVERSATION

Risk 1: Deposit Funding Model Sustainability (Probability: 10-15%) If interest rates fall significantly (to 1.5-2%), Macquarie's ability to offer attractive deposit rates (7%+) becomes unviable. Deposits could flee to higher-paying alternatives or back to traditional bank term deposits.

Mitigation: Ensure deposit rates are always competitive but rational; don't chase market share with unsustainable rates. Build loyalty through product integration and digital experience, not just rates.

Risk 2: Data Center Capex Slowdown (Probability: 15-20%) If AI capex boom moderates faster than expected (due to AI efficiency improvements or recession), data center growth could decelerate.

Mitigation: Macquarie's long-term contracts and management fees provide earnings visibility; even in slowdown scenario, base business is stable.

Risk 3: Fintech Competition Intensifies (Probability: 20-25%) New fintech competitors (potentially Big Tech like Apple, Google) could challenge Macquarie's platform position.

Mitigation: Macquarie's regulatory licensing (bank status) is a moat; its capital and risk management capabilities are difficult for pure fintech to replicate.

RECOMMENDATION: THE THREE-YEAR ROADMAP

2030-2031: Platform Build-Out - Fintech platform expansion (deposits, mortgages, wealth) - Data center fund establishment - API architecture development - Capex: $1.0-1.3B

2031-2032: Ecosystem Partnerships - Strategic fintech partnerships announced - Developer community launched - Data center fund capital deployed - Capex: $800M-1.0B

2032-2033: Platform Monetization - Fintech partnerships generating material fee income - Deposits growing 20%+ annually - Data center fund generating attractive returns - Capex: $700-900M

Expected Earnings Trajectory: - FY2031E: $2.35B (vs. consensus $2.1B) - FY2032E: $2.65B (vs. consensus $2.2B) - FY2033E: $3.0-3.2B (consensus will likely miss again)

The 2030 Report — Macro Intelligence "Strategic Insight for Demanding Leaders"