RCS
21/08/2015 08:31
HALFYR
PRICE SENSITIVE
REL: 0831 HRS Rabo Capital Securities Limited
HALFYR: RCS: Rabobank: economic recovery boosts profit
Sound financial position maintained, customer satisfaction increases
The increase in profit in the first half of 2015 was mainly due to the
decline in loan impairment charges. The underlying profit performance
emphasises the need to further improve performance, not least because of
stricter capital requirements in future.
Strong financial results:
o Rabobank Group booked net profit of EUR 1,522 million in the first half of
2015 (+41%).
o The recovery in the Dutch economy contributed to a sharp fall in loan
impairment charges at the local Rabobanks and at real estate subsidiary FGH
Bank. This contributed to a return on tier 1 capital of 9.0% in the first
half of 2015.
o The efficiency ratio improved to 60.6%. The effects of the cost-reduction
measures are starting to show. Further improvements to the efficiency ratio
will require continuing focus on cost control and improved income.
o Loan impairment charges fell to EUR 356 million (-70%), well below the
long-term average.
o Amounts due to customers rose by EUR 1.9 billion to EUR 328.2 billion.
Savings by retail customers were up 1% to EUR 143.6 billion, despite
additional mortgage repayments.
o On balance, the loan portfolio increased by EUR 4.7 billion to EUR 434.4
billion, mainly due to currency effects. The economic recovery in the
Netherlands has not yet led to higher demand for loans from businesses. The
market share in the trade, industry and services sector in the Netherlands
increased slightly.
o The result was pressured by impairment of the goodwill for RNA
(California).
o In the first half of 2014, the result was reduced by EUR 214 million due to
the non-recurring resolution levy in connection with the nationalisation of
SNS Reaal. In the first half of this year, a charge of EUR 121 million was
incurred for the contribution to the National Resolution Fund in the
Netherlands. In the second half of this year, Rabobank will also need to take
account of the bank tax and the contribution to the ex-ante financing of the
deposit guarantee scheme.
Sound financial position:
o Solvency, as measured by the common equity tier 1 ratio, came to 13.2%
(1-1-2015: 13.2%). The capital ratio improved to 21.5% (1-1-2015: 20.8%).
o The liquidity position remained strong, with a total liquidity buffer of
EUR 81 billion.
o Credit ratings were maintained at a high level.
Customer satisfaction increases:
o The Vision 2016 programme is contributing to better streamlining and
virtualisation of our service provision.
o Net promotor scores are higher, but the underlying score is still below our
stated ambition for customer focus.
o Product innovations: Rabo Wallet, Rabo SmartPin.
o The new mobile banking app will be launched in September 2015.
End CA:00268815 For:RCS Type:HALFYR Time:2015-08-21 08:31:17
