Rabobank Group

5-3-2010 | Other news

Despite the economic headwinds, the Rabobank Group managed to maintain its robust capital position and was able to deliver a solid performance in 2009 with net profit of EUR 2.3 billion. ‘A sound result in a difficult year,’ said Piet Moerland, Chairman of the Executive Board of Rabobank Nederland.

Food & Agri
Piet Moerland said that lending has been reduced throughout Europe. The Netherlands does, however, stand out favourably in comparison to the other European countries and Rabobank has performed positively in this area within the Netherlands. The bank granted 45 billion euros in new loans in the Netherlands and 15 billion euros in loans internationally.
While this constitutes a decrease in international lending as a whole, the bank actually posted an increase in lending within the international Food & Agri sector. ‘This corresponds with our international strategy of being the leading business bank in the field of Food & Agri,’ Piet Moerland said at the presentation of the annual results on Thursday.

Safe haven
There was clearly a considerable decrease in corporate time deposits. Moerland and Chief Financial Officer Bert Bruggink said this is a logical development: ‘First of all, companies urgently need the cash themselves right now due to the financial crisis and this is why the funds previously placed on deposit are now being withdrawn. There are, however, also clear signs of a reverse effect of the safe haven that Rabobank formed in the autumn of 2008. At that time funds flowed into Rabobank because clients were looking for a sound bank to deposit their money with following the collapse of Lehman Brothers. Now that the economy is recovering, parts of these additional deposits are once again flowing back to other banks. It is indicative of the safe haven effect,’ explained Moerland.

Ireland
Rabobank Group has made a total of 2 billions euros provisions for the bad debt costs. Over one billion euros was reserved for Ireland.

Berry Marttin, the Member of the Executive Board of Rabobank Nederland responsible for the international retail banking business, explains: ‘These are extremely difficult times in Ireland. The Irish economy is not recovering and the conditions remain challenging. This situation clearly demands patience. Rabobank is primarily active in the field of real estate in Ireland and there currently simply is not a market for real estate in the country. There is no alternative but to wait until the situation improves. We will then have to see once the real estate has been sold whether the provisions that have been made now are actually necessary. This could consequently take five years or more. While nothing has consequently been written off, the reality is that twenty percent of the investments will not be recouped.’

Co-operative values
‘We will have to add even greater focus to our activities in 2010. This is also the year that we, as a co-operative bank, will have to fulfil who we are by standing behind the customers for as long as this is deemed necessary and responsible. This is what we are doing now and what we will continue to do in the future. We will furthermore have to work on our financial health in 2010. It is also tremendously important for a co-operative bank to achieve healthy and profitable development,’ concluded Moerland.