a lot of consolidation in
the farming sector
Size really does matter here,
Added value
Ireland
are already benefiting from Rabobank's injection of know-how,
technology and funding. As Caroline Steenvoort is delighted
to point out: "I think the numbers teil a great story here. The two
European retail banks' share of RI's total net profit in 2007 was
10%, and in the same period they contributed 35% of all
retail banking profits outside the Netherlands. That makes
European retail banking a big business!"
So can Rabobank repeat this level of success in Asia? Although
RI's retail banking presence in Asia is still fairly modest, it has
already carved out a strong position in Asia through last year's
acquisition of retail banks Hagabankand BankHagakita
(see article on page 24). The acquisition made Rl the leading
international bank in Indonesia's thriving F&A market, says
Singapore-based Rob van Zadelhoff, RI's Head of Asia. "We've
merged the two banks with Rabobank's corporate banking
operation to create a fully-fledged universal banking business.
With 120 offices, largely in the main cities of Indonesia, the
new bank has a very strong position in the SME sector, which in
Indonesia is dominated by the Chinese community. The bank
will expand its presence in the retail market of Asia which will
give us an additional income stream with good returns.
And it's a distribution channel to other Rabobank Group
members like De Lage Landen and Achmea, as the bank can
also sell their products," Van Zadelhoff says.
Of course, with so many Asian markets still protected, RI's
strategy in this huge region is very much long term. But the
bank is laying a solid foundation for the future, with a number
of retail banking initiatives through Rabobank International
Advisory Service (RIAS) which is managed by Rabobank
Development. RIAS advises rural agribusiness banks around
the world on how to improve their businesses. Rabobank
has already acquired a profitable 10% stake in United Rural
Cooperative Bank of Hangzhou (URCB) in China and is in talks
on similar ventures with banks in Yunnan and Liaoning.
"URCB is a provincial bank, so it's quite small in Chinese terms.
But it does have a very strong presence in Zhejiang province,
one of the richest provinces in China with a population of
around 50 million people," Van Zadelhoff says.
RIAS is also advising state-owned rural banks in Vietnam and
Malaysia, both very promising F&A markets for Rabobank once
they are opened up for foreign investment. 'These are two
promising markets for the future growth of Rabobank in Asia
and once we've helped these banks to modernise they may
meet RI's investment criteria. But meanwhile we are building
close ties with the governments in the region through RIAS
and that should stand us in very good stead in the future,"
van Zadelhoff adds.
One of the keys to RI's success is undoubtedly the added value
it brings to both acquisitions and partnerships. It is hardly
surprising then that when a group of Rabobank India managers
decided to set up their own bank they were very pleased that
Rabobank was wiliing to take a 20% stake in what has been a
very successful venture in a very competitive market. And
added value comes in a variety of forms, Cor Broekhuyse adds,
referring to the much wider range of products the community
banks in California offer since the Rabobank acquisition. "You
wouldn't normally think of California farmers as people who buy
GFM products like interest rate derivatives. But Ronald Blok saw
the need, and marketed it. And we've been amazed by the sales
in the fïrst year. And this is defïnitely something we'll be doing
in other countries. It's a perfect example of anticipating your
clients' needs."
20 ISSUE 17
THE WORD
