(Adds outlook, CEO comment, shares)
By Swati Pandey
SYDNEY, May 6 (Reuters) - Australia's top investment bank Macquarie Group MQG.AX on Friday lifted its annual net profit and dividends to a record and said it expected earnings in the current financial year to be broadly in line with 2016.
Net profit for the year-ended March 31 jumped to A$2.06 billion ($1.54 billion) from A$1.6 billion a year ago, narrowly beating analysts' estimate of A$2.04 billion. The bank raised its final dividend by 21 percent to A$4 per share.
Macquarie's stellar results come at a time of dire earnings from three of Australia's four major banks that this week posted slower earnings growth and steady or lower dividends. remains well positioned to deliver superior performance in the medium-term," CEO Nicholas Moore said in a statement.
Earnings growth was led by its stable annuity-style businesses such as wealth management and retail banking, while the market-facing division was a drag with the division's combined net profit contribution down 3 percent from a year ago.
Earnings at the Sydney-based bank, which generates nearly 70 percent of its income overseas, were also boosted by the acquisition of an aircraft portfolio from AWAS Capital during the year and a lower Australian dollar.
Macquarie has become an investor darling for its consistently strong earnings and focus on annuity-style businesses, which have replaced investment banking to contribute the lion's share of earnings at around 70 percent of group profit.
This year, however, its shares have been one of the worst performers on the benchmark S&P/ASX 200 index, falling more than 21 percent in a flat broader market, largely due to concerns about its commodities exposure.
Macquarie warned in February that earnings from its commodities and financial markets division could slip from a year ago led by a sharp sell-off in U.S. credit markets. commodities and financial markets unit, part of its market-facing division which contributes less then 30 percent of group's net profit, had been a bright spot for the bank.
Analysts see risks of increasing impairments in its commodities portfolio over the next 1-2 years following a plunge in oil and metals prices globally.
On Friday, Macquarie said it had taken further impairments on "certain underperforming commodity-related loans" in the metals and energy capital portfolio. ($1 = 1.3398 Australian dollars)