FlCE HOUI
RETAIL BANKING
Safe pair of hands
Right bank, right place
California
Australia
As in Australia, the sheer distances in California can make it
more diffïcult to get close to clients, Blok says, but this is a lot
easier when you have offices in small towns across the state.
"In the big cities we might be competing with a hundred
banks, but there are very few local banks that can compete
with Rabobank in terms of products and services. Rabobank's
triple A status also gives us a big edge, especially at a time
when many US banks are struggling with the credit crisis. In
fact, people are taking their savings out of other banks and
depositing them with us because of our reputation as a safe
bank."
'This focus on retail banking with an F&A edge not only offers
distinct growth opportunities by diversifying income, it also
helps create a much lower risk business for Rl. The retail
business creates a steady income flow and is much less
sensitive to market fluctuations than the wholesale business.
This is also the reasoning behind RI's entry into the European
retail market," says Caroline Steenvoort, Head of European Retail
Development. "What's more, it improves RI's access to funding
and it gives us a chance to leverage the core competencies of
Rabobank our brand, our triple A rating, and our retail and
community banking expertise in a new area.The retail
banks help to raise our profile in the marketplace and they're
increasingly giving us an outlet to service the international
needs of Rabobank's domestic cliënt base. Overall, retail
banking is a steady profit earner and that's helping us to
smooth out the inevitable profit swings that are part and
parcel of wholesale banking."
RI's European retail banking business kicked off with the
acquisition of Ireland's ACCBank in 2001 .The then state-owned
Agribusiness Credit Corporation proved a good fit with RI's
expertise in retail banking and F&A. ACCBank has a network of
around 40 branches in Ireland and is looking to forge a niche
within the SME and mid-market corporate banking sector.
"ACCBank has already brought us a big chunk of net profit
since becoming part of Rl. The slow-down of the Irish economy
will obviously have an impact, but we're confïdent that with a
renewed organisation and management the bank will continue
to perform positively," Steenvoort says.
Rl has also now tuned its sights on one of Europe's most
promising markets, Poland, with the acquisition of a majority
stake in BGZ, one of the major players in the country's F&A
sector, with 250 retail outlets across the country (see article
on page 8). Both Ireland and Poland have huge potential for
growth in retail banking. "Poland, with a population of around
40 million and a strong base in F&A, and ever-closer ties with
Europe certainly offers tremendous promise," Steenvoort says.
"Also, very important is the fact that Dutch clients of our local
Rabobanks, are increasing their investments in Poland and with
BGZ we have a strong presence on the ground to serve them."
What emerges from this is that Rabobank has an uncanny
ability to buy the right bank, in the right place at the right time.
Since combining the three community banks in California, their
total assets have more than doubled to USS 8.4 billion, the
Australasia business is thriving and the Irish and Polish banks
ISSUE 17
THE WORD
