42 Loan impairment charges 44 Taxes - 43 Regulatory levies 45 Transactions with related parties Inhoudsopgave Voorwoord Bestuursverslag Corporate governance Consolidated Financial Statements Company Financial Statements Pillar 3 in millions of euros 2016 2015 in millions of euros 2016 2015 Loans and advances to banks (10) Income tax Loans and advances to customers 474 1,087 Reporting period 527 555 Recoveries following write-downs (157) (101) Adjustments of previous years (6) (17) Credit related contingent liabilities (7) 57 Recognition of previously unrecognised tax Loan impairment charges 310 1,033 losses (1) (4) Deferred tax 174 121 Total income tax 694 655 In 2016 loan impairment charges were at a lower level compared to 2015, especially for the Dutch portfolio. The is mainly caused by the recovery of the economy which leads to a limited number of new defaults, recovery of existing defaults and adequate allowances for existing impaired clients. The effective tax rate was 25.5% (2015: 22.8%) and differs from the theoretical rate that would arise using the Dutch corporate tax rate.This difference is explained as follows: in millions of euros 2016 2015 Operating profit before taxation 2,718 2,869 Applicable tax rate 25.0% (2015:25.0%) 25.0% 680 25.0% 717 I lncrease/(decrease) in taxes resulting from: Tax-exempt income (4.2%) (116) (3.7%) (105) Tax rate differences 2.6% 73 3.6% 104 Non-deductible expenses 2.6% 72 2.1% 60 Recognition of previously unrecognised tax losses (0.1%) (1) (0.1%) (4) Other permanent differences (0.4%) (12) (2.5%) (72) Adjustments of previous years (0.2%) (6) (0.6%) (17) Other non-recurring tax items 0.2% 4 (1.0%) (28) Total income tax 25.5% 694 22.8% 655 The other permanent differences mainly comprise of the deduction of interest payments on Capital Securities and the impairment of Achmea. The regulatory levies consist of bank tax, contributions to the single resolution fund and the deposit guarantee scheme. Banks operating in the Netherlands on 1 October of the current year are required to pay bank tax. There are two rates of bank tax: A rate of 0.044% for current liabilities and a rate of 0.022% for long-term liabilities, based on the balance on December 2015. In 2016, Rabobank Group was charged a total of 166 (2015:168). In 2016, the bank levy in Ireland amounted to 4(2015:4). On 1 January 2016 the European Single Resolution Fund (SRF) was set up. This fund will for a large part replace the National Resolution Funds, including the Dutch National Resolution Fund (NRF) that was set up on the 27 November 2015. Both funds have been established to improve the effectiveness of resolution instruments. Banks and investment firms that are in the scope of the SRM-regulation are obliged to contribute to the SRF.The NRF is build up exclusively by lump-sum contributions. In 2016, the contribution to the Single Resolution Fund amounted to 180. In 2015, the contribution to the National Resolution Fund amounted to 172. Per the end of 2015, the new pre-funded deposit guarantee scheme was introduced. In 2016, banks have to pay a premium on a quarterly basis. Target size of the scheme is 0.8% of total guaranteed deposits of all banks together. In 2016, the contribution to the Deposit Guarantee Scheme amounted to 133. Two parties are considered related if one party exercises control or has significant influence over the other party with regard to financial or operating decisions. In the normal course of business, Rabobank conducts a wide variety of transactions with related entities which involve different types of loans, deposits and transactions in foreign currencies.Transactions between related parties also includes transactions with associates, pension funds, joint ventures, the Executive Board and the Supervisory Board.These transactions are conducted against commercial terms and conditions and market prices. In accordance with IAS 24.4, transactions within Rabobank Group are not disclosed in the consolidated financial statements. 238 Rabobank Jaarverslag 2016

Rabobank Bronnenarchief

Jaarverslagen Rabobank | 2016 | | pagina 239