Mr Wright, a 35-year Macquarie veteran, helped start CGM’s financial markets business when it was just “two men and a labrador”, Ms Wikramanayake said. The succession plan almost mirrored that of Mr O’Kane’s rise at the firm. Before he took over CGM in 2019, Mr O’Kane was the head of commodity markets and finance.
Despite being the highest-paid executive at the so-called Millionaire’s Factory and a critical component in Macquarie’s global expansion, Mr O’Kane has maintained a low profile at the bank.
An avid supporter of the AFL team Richmond Tigers, Mr O’Kane would hold morning meetings at Macquarie’s Texas office – festooned with Tigers paraphernalia and a map of North American gas pipelines – to discuss weather patterns that would impact the day’s trading.
In 2021, amid one of the few windows that year during the pandemic when overseas-based Australians could return home, Mr O’Kane made the most of the open border to buy a house in Sydney’s Point Piper. He bought the home of Sydney FC chairman Scott Barlow for about $40 million. At the time, it was the most expensive sale of the year.
Growth through acquisitions
For years, Wall Street rivals baulked at the idea of Macquarie gaining a strong foothold beyond infrastructure or Australian banking and markets. Yet, Macquarie’s decision to acquire Houston-based natural gas trading operation Constellation Energy in 2009 equipped CGM with about 130 staff based in the US Midwest region, as well as the lucrative, oil-rich Gulf of Mexico and New York.
Constellation also opened Macquarie up to liquefied natural gas trading – all business lines that contributed heavily to last year’s $6 billion group profit.
Mr O’Kane was also a senior CGM figure when Macquarie purchased Cargill’s petroleum business in June 2017. The acquisition included Cargill’s crude oil and oil products trading in North America, as well as Canadian gas and US power desks, Macquarie told investors on a US investor tour in March last year.
Alongside commodities trading, interest rate and foreign exchange volatility buoyed earnings at CGM, as clients required more hedging and financing activities in areas like credit products.
Mr Wright will take over a business that comprised about 49 per cent of Macquarie’s group profits for the first half of 2024, thanks to bumps in fixed income, foreign exchange, credit and futures trading. Mr Wright led the build-out of Macquarie’s global financial markets platform, which comprised areas like FX and US credit markets.
The highly lucrative commodities trading arm, however, was down on the prior year due to less inventory management and lower trading revenues in North American gas, power and emissions.
Ms Wikramanayake said on Tuesday earnings in the 2024 financial year will be lower across the business. The combination of less volatility in energy markets and warmer weather in the northern hemisphere means CGM will not enjoy the same earnings surge as 2023 when profit soared 54 per cent.
The group’s energy trading arm is also defending itself in four class action lawsuits that alleged it and other energy traders, such as Chevron and BP, illegally profited from a deadly ice storm in 2021. The state of Kansas is asking for $US429 million ($657 million) in damages from the energy trading houses, which supply power to retail distributors.