Money
in the
bank
Funding Policy for
the Group
The world's safest bank
FUNDING LIQUIDITY
There was a time when requests for long-term funding and capital from
around the organization were modest. But as the Group has grown, so
have our requirements. How does Group Treasury - Global Liability
Management (GT-GLM) raise the money we need? The Word
reports on how we are getting into debt.
Creative sourcing
Our Funding Policy is based
on a number of key drivers:
to keep average funding costs as
low as possible
transparency of funding costs
diversification of funding
sources
flexibility of funding instruments
marketing of Rabobank debt
and Investor Relations
prudent liquidity ratios
prudent liquidity mismatch
positions
Rating agency
Rating Since
Moody's
Aaa/P-1 1986
Standard Poors
AAA/A-1+ 1994
Dominion Bond
AAA 1999
Fitch-IBCA
AA+ N/A
Micha Klein (1964), Get the Goodies 1993-1998,
C-print mounted on plexiglass and dibond,
wooden frame, 35x45x3 cm (Art offer for staff
members of the Rabobank Group,! 998)
for Mandate must meet all points of
policy, not least because the risk
involved and the transparency of the
debt has direct consequences for the
top rating Rabobank enjoys from all
agencies.
The Funding Mandate covers both sen
ior and subordinated (Tiers 1, 2 and 3)
issuances of debt securities in various
currencies and maturities. Says David
Vander, Head of Group Treasury, 'We
raise this funding and capital through
various programs and instruments
issued or guaranteed by Rabobank
Nederland. These activities involve a
wide range of instruments, including
the Member Certificate program (see
sidebar, page 15). As a co-operative
Within the Rabobank Group, there
is keen competition for access to
long-term funding. All units, including
Rabobank International (RI), are vying
for the money needed to expand busi
ness and meet the growing needs of cus-
tomers. Raising and supplying this flow
of funding is the responsibility of
Group Treasury in co-operation with
Capital Markets. But it is a true team
effort in that many disciplines within
the Group are involved in the process.
Every year, the Funding Policy and
Liquidity Risk Committee, comprising
professionals from a wide range of
departments, requests a so-called
Funding Mandate from the Executive
and Supervisory Boards. This request is
underpinned by the Group's Funding
Policy (see sidebar, right). The request
14 I Rl The Word I