30 Reserves and retained earnings
Inhoudsopgave Voorwoord Bestuursverslag Corporate governance
Consolidated Financial Statements Company Financial Statements Pillar 3
In millions of euros
2016
2015
Financial guarantees
11,595
10,402
Loan commitments
44,889
46,674
Letters of credit
6,276
4,980
Credit related off balance sheet commitments
62,760
62,056
The contractual commitments relating to the acquisition,
construction and development of work in progress and
investment properties amounts to 735 (2015: 678).
Contingent liabilities related to litigation
Rabobank is involved in a number of legal and arbitration
proceedings in the Netherlands and other countries, including
the United States, in connection with claims brought by
and against Rabobank Group arising from its operations.
The maximum amount of non-remote contingent liabilities
relating to claims is 61For additional information, please refer
to Paragraph 4.10, 'Legal and arbitration proceedings'.
Contingent liabilities related to income tax
The European Commission has addressed questions to the
Dutch government about article 29a of the Dutch Corporate
Income Tax Code. If the European Commission would decide
to start a formal investigation and ultimately would conclude
that this is a case of state aid, Rabobank may have to repay tax
benefits it enjoyed from 2015 onwards.
Article 29a of the Dutch Corporate Income Tax Code was
included in the Dutch Corporate Income Tax Code so that
capital instruments issued by credit institutions and which
are covered by EU regulation 575/2013 would be considered
tax deductible. In this context, Rabobank issued Capital
Securities in January 2015 and in April 2016, amounting
respectively to EUR 1.5 billion at a fixed interest rate of 5.5%, and
EUR 1.25 billion at a fixed interest rate of 6.625%.The contingent
liability related to this matter amounts to 54.
Liabilities relating to operating leases
Rabobank has concluded various operating lease contracts as
lessee, mainly with respect to properties, information systems
and cars. The future net minimum lease payments under non-
cancellable operating leases can be broken down as follows:
The expected future minimum lease payments receivable
from sub-leases are 0 (2015: 3).The operating lease expenses
are 98 (2015: 73). These are included in 'Other administrative
expenses' in the statement of income.
Payments receivable from operating leases
Rabobank has concluded various operating lease contracts
as lessor. The future minimum lease payments receivable
from non-cancellable operating leases can be broken down
as follows:
No contingent lease payments were recognised as assets
during the current year.
1 Prior-year figures adjusted due to the restatement (see note 2.1
in millions of euros 2016 2015
Not later than 1 year 796 1,340
Later than 1 year but not later than 5 years 1,551 2,050
Later than 5 years 83 38
Total payments receivable from
operating leases 2,430 3,428
in millions of euros 2016 2015
Foreign currency translation reserves 203 (76)
Revaluation reserves - Available-for-sale
financial assets 571 512
Revaluation reserve - Cash flow hedges (70) (39)
Revaluation reserve-Other - 2
Revaluation reserve - Assets held for sale (70)
Remeasurement reserve-Pensions (219) (175)
Revaluation reserve - Fair value changes due to
own credit risk on financial liabilities designated
at fair value (303)
Retained earnings 25,709 25,399
Total reserves and retained earnings
at year-end 25,821 25,623
in millions of euros 2016 2015
Not later than 1 year 145 103
Later than 1 year but not later than 5 years 332 308
Later than 5 years 375 185
Total liabilities relating to operating leases 852 596
231 Notes to the consolidated financial statements