2. Introduction Inhoudsopgave Voorwoord Bestuursverslag Corporate governance Consolidated Financial Statements Company Financial Statements Pillar 3 This document presents the consolidated Capital Adequacy and Risk Management report (hereafter referred to as Pillar 3) of Rabobank Group ('Rabobank') as at 31 December 2016. In addition to the changes required under CRD IV, there remain ongoing regulatory developments. Rabobank keeps monitoring them closely and assessing their impact. Rabobank operates under the CRD IV capital framework which came into force at the start of 2014. CRD IV constitutes the Basel framework which seeks to align regulatory requirements with the economic principles of risk management. The CRD IV was implemented into Dutch law as amendments to the 'Wet op het financieel toezicht'and further accompanying regulations. Pillar 3 requirements under CRD IV are designed to promote market discipline through the disclosure of key information about risk exposures and risk management processes. Rabobank's 2016 year-end disclosures are prepared in accordance with the CRD IV requirements and associated guidelines of the European Banking Authority (EBA) technical standards, in force as of 31 December 2016. The information in Pillar 3 has not been audited by Rabobank's Group external auditors. However, the Pillar 3 disclosures are subject to the Rabobank's Group internal controls and validation mechanisms, to provide assurance over the information disclosed in this report as well as with regards to compliance with laws and regulations. The remainder of this report contains: Chapter 3: About Rabobank; Chapter 4: The approach of risk management, the organisation and the risk management framework; Chapter 5: Capital management, regulatory and economic capital and key capital ratios; Chapter 6: Credit Risk (including counterparty credit risk) and equities in the banking book; Chapter 7: Securitisation in the Rabobank portfolio; Chapter 8: Operational risk management; Chapter 9: Market risk and interest rate risk framework; Chapter 10: Liquidity risk management framework and measurement; Chapter 11: Remuneration principles and policy of Rabobank. The implementation of CRD IV is subject to transitional arrangements. By 1 January 2018 all CET1 capital deductions should be phased in and the non-eligible Tier 1 capital instruments will be phased out by 1 January 2022. Consequently, Rabobank's capital position is presented by applying the transitional arrangements. Rabobank also disclosed the end-point CRD IV rules (i.e. fully loaded basis) for informational purposes. 304 Rabobank Jaarverslag 2016

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Jaarverslagen Rabobank | 2016 | | pagina 305