Investment Banking
RaboOlsen
WHAT'S NewS Issue 10 November 1997
info exchange
15
holdings, individual risk profiles, different
jeporting requirements and varying
Bgulatory restraints. 'Every customer is
different and we seek to serve them in a
tailored way,' remarks Marcel Vernooy.
ADDING VALUE
To date, Rabo Olsen has aimed its service
primarily at the Dutch institutional market.
'Holland is a very small country with a
huge asset base invested abroad and
represents an ideal market in which to
begin,' Dijkstra says. However, as the pace
of globalization proceeds, the ambition is
to reach corporate customers and the
increasingly important institutional investor
base throughout the network worldwide.
'We're making contact with colleagues
throughout the organization and spreading
the news that currency overlay is an
important way that we can provide our
^ïstomers with value-added,' Dijkstra says.
Rabo Olsen can be contacted
on the following address and
telephone numbers:
Rabo Olsen
Global Overlay Strategies
Croeselaan 18
3521 CB Utrecht
The Netherlands
Tel +31 30 216 3481
Fax+31 30 216 3479
Internet: dijkstra@rabo-olsen.com
FX Impact on stocks
The graph at right
shows that for a
Dutch guilder-hased
stock investor, the
average influence of
fluctuations in
exchange rates on
the total tnonthly
performance of the
MSCI World Index
is 43% with a
Standard deviation
of 26%.
Global Overlay Strategies
THE CURRENCY INFLUENCE ON THE MONTHLY PERFORMANCE OF THE JP MORGAN WORLD INDEX EX HOLLAND
(AUGUST 1991 THROUGH FEBRUARY 1997)
ffpB
Stock Influence
Currency Influence
FX Impact on bonds
RELATIVE DISTRIBUTION OF THE CURRENCY INFLUENCE
ON THE MONTHLY PERFORMANCE OF THE JP MORGAN WORLD INDEX EX HOLLAND
(AUGUST 1991 THROUGH FEBRUARY 1997)
9
The figures above indicate the percentage of all monthly returns in
which the currency influence on the total performance of the index was:
<10% 10%-29% 30%-69% 70%-99% 100%
(continued from page 5)
PRODUCT MANAGEMENT
All this cannot be done without some
significant internal reorganization. In
today's deregulated markets, for example,
it is no longer cost-effective to duplicate
funding or trading capacity in each or
even most branches. Customers too, want
to see the full, not just local product range
from us. Accordingly, a global product
management structure will be introduced.
Under the existing set-up most branches in
the network essentially operate as self-
contained units when it comes to their
trading/investing activities and related
support units. Henceforth, as von Ungern-
Sternberg explains, 'we will run our
trading operations out of whichever key
market offers the greatest liquidity and the
most information about what's going on
^Athe product concerned. For example,
wew York will run the global dollar swap
book. These centres of competence will
make their knowledge and products
available to branches throughout the net.
The branches will meanwhile concentrate
on relationship management, origination,
product distribution and credit
assessment. They will access a wider
product range from the whole network
than before.' (This process will be actively
managed by recently-installed global
product managers.)
MIRRORING CHANGES
The above strategy will only succeed if the
front-office reorganization described
above is mirrored by corresponding
changes in the currèntly highly
decentralized support infrastructure. For
example the IT, Settlement and
Accountancy functions will exert more
centralized control to ensure that the cost
base is kept under control and monitored
in detail on a monthly basis. Von Ungern-
Sternberg dismisses the occasionally
expressed concern that the outcome of the
investment banking thrust will be to
produce a bank within a bank. 'The effect
will be quite the reverse,' he insists. 'The
global product management structure will
produce a more customer-driven,
integrated bank in which everyone is a
stakeholder in mutual success. Just as any
corporation has a logistical system, so will
Rabobank International,' he concludes.
'Instead of splitting the bank, the global
product structure will actually weave it
much closer together.'
In brief
AUSTRALIA - SPREADING
OUT DOWNUNDER
Business is booming in Australia, with a
total of five new offices sprouting up
around the country's thriving agricultural
areas.Atemporary office has been
functioning for over nine months in New
South Wales'largest irrigation town,
Griffith - the permanent office promises
to be a few weeks away from opening.
Newest to open its doors in New South
Wales was an office in Goulburn, May this
year. In the cane growing region of
Mackay a new Rabobank office opened
four months ago, while another opened
its doors in the cotton growing region of
Moree.ln Queensland an additional office
was opened in April in lngham,an area
known for its rapid sugar industry
expansion.