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Interim Financial Information 2013

Interim Financial Information 2013. Rabobank Group – Press Conference. 22 August 2013. Interim Financial Information 2013 – results. Piet Moerland, Chairman of the Executive Board. 22 August 2013. Rabobank Group Decrease in profit amid continuing recession.

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Interim Financial Information 2013

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  1. Interim Financial Information 2013 Rabobank Group – Press Conference • 22 August 2013

  2. Interim Financial Information 2013 – results Piet Moerland, Chairman of the Executive Board • 22 August 2013

  3. Rabobank GroupDecrease in profit amid continuing recession

  4. Developments in first half of 2013 (1) • Weak economic conditions in the Netherlands • Benefit from strategic international focus on food and agri • Robeco sold in July • New Collective Labour Agreement and transition to new pension scheme • LIBOR investigations

  5. Developments in first half of 2013 (2) Market shares in the Netherlands 30-Jun-13 31-Dec-12 • Mortgages 31% (31%) • Savings 39% (39%) • Trade, industry and services 44% (43%) Cooperative dividend

  6. Balance sheet developments and ratiosStrong positions

  7. Some recovery of margins on savings deposits Increase in innovation costs Slight rise in value adjustments Domestic retail banking divisionNet profit EUR 615 million; -3% 635 615 • Loan portfolio EUR 305 billion; -0.5% • Amounts due to customers EUR 218 billion; +1.7% 215 307 218 305

  8. Sale of Yes Bank in the first half of 2012 Lower results at Global Financial Markets and Rabo Private Equity Decrease in value adjustments in Ireland Wholesale and international retail Net profit EUR 496 million; -9% 543 496 • Loan portfolio EUR 105 billion; -2.0% • Food and agri comprises 50% of the portfolio • Amounts due to customers EUR 120 billion; +1.7% • IDB savings EUR 27 billion; +12% 118 108 120 105

  9. Increase in interest income Limited rise in value adjustments LeasingNet profit EUR 232 million; +21% 191 232 • Lease portfolio EUR 30.2 billion; +2.0% • Food and agri comprises 30% of the portfolio 29.6 30.2

  10. High(er) impairments on land Phasing out MAB Development Increase in bad debt costs Real EstateNet loss Rabo Real Estate Group EUR 198 million 47 -198 • Number of homes sold 1,749; -30% • Loan portfolio EUR 19.3 billion; +0.5% • Assets under management EUR 5.7 billion; +4% 7341 19.2 17200 5.5 19.3 8982 5.7 17800

  11. Interim Financial Information 2013 – analysis Bert Bruggink , CFO • 22 August 2013

  12. Lending Loan portfolio EUR 454 billion; -0.8% • Contraction at local Rabobanks and Rabobank International • Growth at Obvion and De Lage Landen +0% -1.2% -1.9%

  13. Home mortgages EUR 210 billion Few home sales, amended tax regulations and additional repayments 46% of total lending Loan-to-value 83% 20% of portfolio financed with NHG Home mortgages in the Netherlands 209.6 210.1 Value adjustments 6 basis points • 6% of total value adjustments • Approximately 7,000 or 0.56% customers have a payment arrears of 90 days or more • Recovery is no longer possible in the case of approximately 2,800 or 0.23% customers 113 68

  14. Commercial real estate Netherlands (1)6% of lending; 26% of value adjustments

  15. Commercial real estate Netherlands (2)Write-downs versus value adjustments

  16. FundingAmounts due to customers and debt securities in issue Amounts due to customers EUR 340 billion; +1.6% • Customer savings deposits EUR 156 billion; +4.3% • Debt securities in issue EUR 198 billion; EUR -25 billion • NSFR 102% and LCR 131%

  17. Equity

  18. Balance sheet

  19. Rabobank capital strategy Capital structure in % of risk-weighted assets Total capital ratio >20% Total capital ratio 18.7% T2 >2.5% T2 1.8% Tier 1 17.5% Tier 1 16.9% hybrid capital approx. 3.5% hybrid capital 4% Core Tier 1 14% member certificates approx. 2% Core Tier 1 12.9% member certificates 3% retained earnings & reserves 9.9% retained earnings & reserves approx.12%

  20. Value adjustments • Value adjustments 49 bp; long-term average 28 bp • Increase primarily at local Rabobanks and Rabo Real Estate Group • Decrease at Rabobank International

  21. Profit development Rabobank Group

  22. Development of capital ratios * Excluding impact sale of Robeco on 1 July 2013

  23. Interim Financial Information 2013 – current developments Piet Moerland, Chairman of the Executive Board • 22 August 2013

  24. Economic outlook Slight improvement in worldwide growth Global economy improves slightly • Growth emerging markets limited • Outlook US and UK considerably better • The Eurozone is pulling out of recession Dutch growth hindered by decrease in domestic spending • Higher export growth prospects due to higher growth in the US and the UK and return to growth in Eurozone • Government austerity measures continue to put pressure on spending • Further drop in consumer spending, because of decrease in disposable income • Hope is placed in recovery of housing market

  25. Local Rabobanks supervised by RN • Supervision on local Rabobanks for 90 years. • Supervisory role is legally embedded and allocated to Rabobank Nederland. • Rabobank Group encompasses 136 autonomous local Rabobanks. They are the foundation of the Rabobank organisation. Each local Rabobank is autonomous and has its own banking licence. • Local Rabobanks guarantee each other’s obligations. They can fall back on their centralised organisation Rabobank Nederland. • Delegated supervision on behalf of De Nederlandsche Bank has existed since the early 1950s. Supervision pertains to controlled and honest business operations, solvency and liquidity. • The principle is that each local Rabobank performs well. If a bank does not perform well, additional guidance is provided by Rabobank Nederland to the local Rabobank concerned. This is a normal part of the continuous improvement for which the local Rabobanks strive. • On average 5-10% of the local Rabobanks need additional guidance.

  26. Vision 2016 • The world and customer behaviour are changing dramatically. • Customers have a need for simple and transparent financial services and want to be able to take care of their financial affairs anytime and anywhere. • We are streamlining processes, simplifying the product portfolio and providing self-service online and via mobile phones. • This way of serving the customer goes with an efficient organization with a structural higher profitability. • From 28,000 to 20,000 jobs and from 136 to 100 local Rabobanks. • This will also lower our cost base by EUR 1 billion. • Number of branch offices will be halved to approximately 400. Rabobank will still have the most dense branch office network in the Netherlands. • Rabobank will look different in 2016, but it is and will remain the cooperative, sound and sustainable bank for its customers.

  27. Interim Financial Information 2013 Thank you for your attention

  28. Interim Financial Information 2013

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