•w1:
The Robeco connection
Managing change
What'sNewS Issue I January 1999 5
Same culture
Divisional perspective
Significant player
Tough target
Still here
But for former Robeco staff, one aspect
will remain the same - after thorough
discussion, the new division has opted to
use the advice generated by the asset
manager's investment policy committee
(IPC) for its model portfolios. 'If our aim
is to build a truly integrated organization,'
Van Rijckevorsel explains, 'then you have
to apply consistent investment policies.
Robeco's IPC has a well-earned reputation
and we're going to take full advantage of
that. Our own investment committee will
use this advice to create both
discretionary and advisory portfolios -
comprising funds, bonds and equity - for
different cliënt profiles. And given
Robeco's expertise in funds, these will
certainly play an important role in both
^idvisory and discretionary business.'
One example of how these funds can be
used to enhance our offerings to clients is
the Southeast Asia Recovery Fund to be
launched shortly. It allows cautious
players to ease back into the region. It is
this kind of thinking that underpins the
approach established for the division.
Borrowing heavily from the customer
focus strategy, the combined operation
will seek capital preservation and wealth
accumulation for customers based on a
sound, knowledge-driven philosophy.
'Both organizations have a similar culture,
so this won't represent a significant
change,' notes Van Rijckevorsel.
In physical terms, what will change is that
front and back offices will be combined
and, where necessary, relocated. The
process in Switzerland
is already ongoing, led
by Heinz Zimmer.
Stéfan Richter (left),
Robeco's chief in
Luxembourg, will be
heading the com
bined operation there
(Jean-Pierre van
Keymeulen will head the development of
the Belgian cross-border market).
For Robeco as well as Rabobank people
in Luxembourg, the merger has come at
the right time. 'The market is changing
quicker than we anticipated,' comments
Richter. 'From Luxembourg's perspective
of a single currency bloc, the perception
of "offshore" jurisdictions in Europe is
evolving rapidly. Direct and Internet
banking are rapidly growing as well.
Given those factors, you'11 see that we
need to build synergies and economies of
scale that will ensure customers see us as a
significant player in an increasingly
competitive market.'
Anew management team has been
appointed for the Private Banking
Trust Division - Thomas van
Rijckevorsel (chairman), Chris Hayes
(Singapore), Stéfan Richter
(Luxembourg) and Heinz Zimmer
(Switzerland). As yet, the team has
made no external announcements. The
legal and fiscal merger of Luxembourg
and Switzerland is not yet finalized.
This is expected mid-year when a
campaign focusing on cliënt
information will be launched. No
information on the merger should be
released until communication strategies
have been established.
To achieve that position, ambitious targets
have been set for the next five years.
Again, AuM are slated to doublé.
However, in spite of these tough goals, the
new division is also convinced it will have
to grow to contribute significantly to
achieving the strategies of both Rabobank
and Robeco. 'One area is to provide
placing power for our global financial
markets activities,' Van Rijckevorsel says.
'We also see a role in supporting the
distribution of Robeco funds outside the
Netherlands and in contributing to the
business volumes of Rabobank's
brokerage and custody activities. Let's not
forget Trust. We are also setting tough
targets for bringing in other assets under
management business, either by entering
new markets or market segments.'
Unchanged is the notion of selective small
acquisitions, which has proved so
successful of our private bankers in the
past. However, from now on, they will be
pursuing this course as an independent
entity, rather than as one of three
mainstays of RL But as Van Rijckevorsel
is quick to point out, they need the space,
especially if they are to create the critical
mass essential to expanding the service
and product offering to customers. 'And
we're not out of the picture all together,
you know,' he adds. 'We'11 still be here 011
the fourth floor, and we'11 still be working
with RI and other colleagues within the
Rabobank Group, including Interpolis
and other subsidiaries. We may have
made an independent move, but we're not
going it alone.'
hen Rabobank took a 50-percent
stake in Robeco 2.5 years ago, it
was dubbed the deal of the decade; the
perfect marriage. Since then, 'low
profile' seems the best way to describe
this union. At least until now. The
merger between IPB and Robeco's
private banking operations marks a
milestone in cooperation for both.
Rotterdam-based Robeco markets itself
as Europe's biggest independent asset
manager. Originally a cooperative, like
Rabobank, the two organizations
already had a strategie alliance for five
years when Rabobank took a 50-
percent stake in Robeco and a call
option on the remainder in June 1996.
Robeco products were distributed
through the Dutch member bank
network and the two organizations had
ket up a joint research unit, IRIS, for
consultancy and advisory for (retail)
customers. In all, Rabobank committed
NLG 1 billion (EUR 453.8 million),
funding which was earmarked by
Robeco as capitalization for expansion.
At the time, Robeco was comparatively
a smali player in the international asset
management stakes. lts strategie goal
was to reach a level of at least NLG
100 billion (EUR 45.4 billion),
'anything less,' commented Robeco
chairman, 'and you're under pressure.'
Greatly enhanced capitalization would
allow Robeco to make significant
acquisitions for growth. For Rabobank,
the advantages of the enhanced co
operation were a 'logical next step',
according to Herman Wijffels. 'The two
Groups complement each other,
especially in a market where financial
services are becoming more inter
national and new distribution methods
are emerging.' Meantime, various
activities are combined - although
nothing like the scale of this latest
venture. It is a significant step towards
full acquisition - slated for 2002.
