Inhoudsopgave Bestuursverslag Corporate governance
external parties and maintaining a relatively lower liquidity
buffer that is in line with the reduced balance sheet total.
The Annual Review includes a dilemma which addresses the way
in which we want to combine excellent customer service with
growth in our capital and the reduction of our balance sheet.
3. Performance improvement
In addition to excellent customer focus and a balance
sheet reduction, there should also be an improvement in
performance. Our aim for 2020 is a profit improvement of more
than EUR 2 billion (excluding the effects of the reductions on
our balance sheet results) compared to 2014. Reaching this level
of profit improvement would increase the cost/income ratio
to approximately 50% in 2020, and we would achieve a return
on invested capital (ROIC) of at least 8%. The cost/income ratio
is calculated by dividing total operating expenses by total
income. Including regulatory levies, the cost/income ratio will
reach a new level of between 53% and 54% in 2020.The ROIC
is calculated by dividing the net profit realised after non-
controlling interests are related to the core capital (achieved
tier 1 capital plus the goodwill in the balance sheet at year-end)
minus deductions for non-controlling interests in the equity.
The improvement should be effected by both higher revenues
and lower costs.These estimates are in addition to the ongoing
MARS and Vision 2016 cost programmes. The MARS programme
envisions further cost reductions at the central level.The Vision
2016 programme focuses on improving customer services but
at reduced costs.These programmes are running on schedule
and are expected to be completed during 2016.
Implementation accelerators
The implementation of the aforementioned three core
objectives requires an integrated approach towards new and
existing programmes.These programmes come together in the
implementation agenda of the Executive Board. This agenda
forms the basis for the implementation of the strategy, which
focuses on three accelerators:
7. Strengthening innovativeness
Innovative strength is an important prerequisite for improving
current processes, enabling customers to increasingly arrange
their financial affairs independently and facilitating Rabobank
to respond (more quickly) to technical possibilities with new
propositions.
2. Empowering employees
Employees make the ambitions of our customers and Rabobank
come true. In order to fulfil our strategy, it is necessary that
our employees are aware of the social role we have to play as
Jaarrekening Rabobank Groep Jaarrekening Rabobank
a bank. It is essential that they embrace the strategy, know how
to promote it and apply it to their daily work, where there is
room for expertise and entrepreneurship. We are unambiguous
and united in this desire. Employees know how to connect their
personal values with those of the bank, and vice versa. There is
continuous focus on personal development and training, as
well as on building a diverse workforce. In this way, we strive
to show our customers and society as a whole that we are the
bank that is fully focused on its customers.
3. Creating a better cooperative organisation
The new structure of governance increases member
participation and their input in Rabobank as a whole.The more
effective structure will contribute to the transformation that our
organisation must go through to fulfil the strategy.
The Strategic Framework 2016-2020 builds on the current
improvement agenda of Rabobank, the implementation
agenda.To give substance to the three core objecives and their
associated priorities and accelerators, we have drawn up a new
implementation agenda designed along four axes: complete
customer focus, rock-solid bank, meaningful cooperative, and
empowered employees.The implementation agenda will, in
the coming years, enable Rabobank to regain its fundamental
position as a cooperative, customer-focused bank in
the Netherlands and as a leading food and agri bank worldwide.
Financial Framework 2016-2020
The Strategic Framework 2016-2020 provides direction to
Rabobank for the next five years. The financial targets Rabobank
set to be and remain a rock-solid bank are in part determined
by the expected impact of new regulations.These regulations
include Basel IV, the minimum requirement for own funds
and eligible liabilities (MREL) and total loss-absorbing
capacity (TLAC). As a result of these new regulations, capital
requirements will increase. In addition, the risk weighting
of assets and the subsequent required absolute amount of
capital are expected to increase significantly.The objective,
in anticipation of these regulations, is for the common equity
tier 1 ratio to increase to a minimum of 14% and the capital
ratio to increase at least 25% by the end of 2020. The extent to
which these minimum targets are met will vary in accordance
with the definition of the new regulations when they are
officially adopted. In extreme cases, the upper limit for both
ratios could rise to as high as 17% and 30%, respectively.
To facilitate the growth of the common equity tier 1 capital
through retained earnings and allow for the future growth
of Rabobank, an ROIC of at least 8% will be required. We are
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