Shares in Macquarie Group have taken a tumble after the financial services conglomerate fell short of profit expectations.
Macquarie posted $1.6 billion in profit for the six months ended September 30, up 14 per cent from the prior corresponding period, but 23 per cent lower than the half ended March.
The result was about seven per cent below analyst expectations.
The improvement on the same period last year - a particularly poor one for the group - was driven in part by a 68 per cent jump in profits at Macquarie Asset Management, reflecting higher performance fees.
Banking and financial services also brought in more cash, reflecting growth in Macquarie's home loan portfolio and banking deposits.
Macquarie continued its assault on the home loan market share of the big four banks, increasing its mortgage book by nine per cent in the half.
Australia's fifth-largest home loan lender now accounts for 5.6 per cent of the domestic market.
But weaker revenues in commodities and markets impacted the result, with lower contributions from risk management as subdued volatility reduced the hedging activity of clients.
Macquarie expected commodities income to continue to be impacted in the short term, although market volatility "may create opportunities".
Income at Macquarie Asset Management is expected to be significantly up, due to higher returns from green investments, but this will be subject to transaction timings and market conditions.
Transaction activity at Macquarie Capital, which provides investment banking advice, is expected to be "significantly up on a challenging year".
Macquarie declared an interim dividend of $2.60, franked at 35 per cent. The dividend was up from the $2.55 per share paid a year prior but down from the $3.85 for the six months to March 31.
The group remained well-positioned to "deliver superior performance in the medium term, with its diverse business mix", chief executive Shemara Wikramanayake said.
Shares in Macquarie were down 4.2 per cent to $221.84 at midday AEDT on Friday.
