Rabobank confirms ECB capital requirements 2017

Rabobank has received notification of the ECB’s final decision concerning the own funds requirements that it has to meet as of 1 January 2017, following the results of the 2016 Supervisory Review and Evaluation Process (SREP).

The decision requires that Coöperatieve Rabobank U.A. (“Rabobank”) maintains a total SREP Capital requirement of 9.75% on a consolidated and unconsolidated basis. The requirement consists of a 8% minimum own funds requirement and a 1.75% Pillar 2 requirement.
 
The total CET1 minimum requirement is 6.25% consisting of the minimum Pillar 1 requirement (4.5%) and the Pillar 2 requirement (1.75%). In addition, Rabobank should comply with the phasing in combined buffer requirements consisting of a Capital Conservation Buffer (1.25%) and a Systemic Risk Buffer imposed by the Dutch Central Bank (“DNB”) of 1.5% in 2017. This translates into an aggregate 9% CET1 requirement for 2017.
 
In the years 2018 and 2019 the CET1 requirement will increase, as both the Capital Conservation Buffer and the Systemic Risk Buffer requirements will be further phased-in (by 0.625%-point and 0.75%-point per annum respectively). This will result in an expected aggregate CET1 requirement of 11.75% in 2019.  Rabobank currently has a CET1 ratio target of at least 14%.
 
As from 2017 the Pillar 2 surcharge will be split by the ECB into the aforementioned Pillar 2 requirement and a Pillar 2 guidance. The 9% CET1 requirement excludes the Pillar 2 guidance, which is not disclosed. The Pillar 2 guidance is not relevant for the Maximum Distributable Amount (“MDA”). 
 
With a CET1 ratio of 13.4% as per 30 June 2016, Rabobank already complies with the requirements for 2017. The fully loaded CET1 ratio of Rabobank was 12.4% as per 30 June 2016. With a Tier 1 ratio of 16.8% and a Total Capital Ratio of 23.5% as per 30 June 2016 Rabobank also comfortably meets its total SREP capital requirements.
 
Requirement on an unconsolidated basis
The decision also requires that Rabobank maintains a CET1 ratio of 7.5% on an unconsolidated basis. This 7.5% capital requirement includes: the minimum Pillar 1 requirement (4.5%), the Pillar 2 requirement (1.75%) and the Capital Conservation Buffer (1.25%).  The unconsolidated CET1 ratio of Rabobank was 16.4% as at 30 June 2016.
 
Elements of this press release are considered by Rabobank as inside information relating directly or indirectly to Rabobank within the meaning of article 7 of the Market Abuse Regulation (EU Regulation 596/2014) that is made public in accordance with article 17 Market Abuse Regulation.

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Hendrik Jan Eijpe

Press Officer

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+31 30 21 30869

Email
Hendrik-Jan.Eijpe@rabobank.nl

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