the new model could be a real money spinner

funds management is being scrapped for a lending model

Apparently they have $13bn in funds in which they hope to get a return of 20% over three years
so what is that.... $2.6bn over three years

or $866m a year

read on
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Macquarie Group has set up a crack lending unit under investment banking wunderkind Ben Brazil to spend a chunk of the A$13 billion raised over the past three months from the sovereign guarantee.

The thirty-something Brazil - who spearheaded Macquarie's unsuccessful takeover bid for the London Stock Exchange in 2005 - has a mandate to lend the funds to corporations around the world at a higher rate than the cost of the government-guaranteed borrowings and "make the spread", or a profit, on the difference in the interest rates.

The young-gun banker, nicknamed "Brains" by Macquarie's chief executive, Nicholas Moore, has a team of around 30, split between Australia, the US and Europe, to look for special lending situations. Sources cited two avenues for lending: one, buying corporate debt at a discount, and two, looking for viable borrowers in the market for new loans.

At the moment, much of the funding is sitting in semi-government bonds earning 3 per cent compared to Macquarie's roughly 7 per cent cost of sovereign borrowing. If the bank were to buy debt at 80c in the dollar - and there was no default - then it would stand to make a grossed up return of 20 per cent over three years lending at 8 per cent.


http://www.stuff.co.nz/business/industries/2269007/Brains-leads-new-Mac-model