El How has Rabobank International changed
since 2002, the year you became Chairman
of Rabobank's Executive Board?
0 What have been the major
achievements since 2002?
El Are there things we did that
you now regret?
El Do you think Rabobank International
will eventually be integrated in a Rabobank
worldwide cooperative model?
El How would that work?
0 Will there be resistance?
0 What would you say to your successor
Piet Moerland?
A "One of the reasons I accepted the invitation to be chairman was
that l'd again be working for a bank with a strong international
presence. I truly loved my 12 years at Van Lanschot, a small but
perfectly formed Dutch private bank, but before that I worked
for 23 years at Amro Bank (later ABN AMRO, ed), largely in
international banking. I saw myself as a truly international banker,
so it was a welcome challenge tojoin Rabobank when itwas
expanding its international network. I also liked the fact that the
international business was partly linked to the very specific nature
of Rabobank as a cooperative bank and its roots in Food and
Agribusiness.
"On the other hand, we were operating pretty much like other
international banks. So we decided that we should shape the
international strategy much more in line with Rabobank's origins.
RI's core focus would be on the F&A chain, as a wholesale bank
and as a retail bank where appropriate. That strategy has certainly
paid off. We now have very successful retail banking operations in
Australia, the US, Poland, Brazil, Chile and other countries. In most
of those countries profits have tripled in the past few years."
A"l thinkit'sfairto say that keeping Rl trueto Rabobank's roots and
its cooperative ethos should be seen as a major achievement. Of
course, we could have made more profit if we'd focused more on
investment banking, but what we've done is build a sustainable
and profïtable business with a tremendous long-term outlook.
Very importantly, Rl fits Rabobank. While other big banks are hastily
selling off businesses they no longer consider core, we're still
expanding internationally. This is not to say Rl should not be involved
in investment banking to service our clients as fully possible, but it
should never overshadow our overall focus on commercial retail
banking. I'm very proud of the fact that we've successfully developed
businesses like trade and commodity fïnance, especially in soft
commodities, and sustainable banking, such as the financing
of non-fossil sources of energy."
A 'The cooperative ethos could be best captured by the Dutch
word zelfredzaamheid, which translates roughly as self-sufficiency
or the ability to take care of yourself. In other words, never expose
yourself to too much risk. I thinkthe fact that we're one of the very
few major banks worldwide that has not needed government help
proves that we kept risk at manageable levels. Of course, we made
mistakes. We also developed certain structured fïnance products
that were, in hindsight, a mistake. And I wish l'd been more
cautious. Luckily, we recognised those mistakes quickly enough
and our exposure was never so high that it might have destroyed
Rabobank. Indeed, I'm grateful to our people at Rl that they limited
losses to the extent they did."
ATve said from the very beginning that ifwe do not succeed in
giving Rl a more cooperative structure, we will fail in the long run.
Most of Rabobank's future growth will come from Rl. That's a fact.
But if Rl is purely profit oriented, I believe we'll see a cultural split
from our Dutch business, which will make it difficult to co-exist
in one organisation. After all, the point of cooperative banking is
that your members - your clients - have the most influence on
what you do and how you do it at certain levels. That should be
true for all our operations, worldwide."
A "Well, we already have clients sitting on advisory boards in the
US and Australia, giving advice on the products and services we
should be offering. If this works well, we could give these boards
the power to decide on certain issues. Not the likes of capital
allocation, of course, but on issues such as how we structure
the business for our clients, what services we provide, what the
risks and opportunities are in a country and also the charities we
support and how much capital we allocate to those charities. And
I hope that the people in these boards will eventually join the
general assembly as advisers. I don't believe we can confine the
power to decide on what we do in, say, the US or Latin America
to only our Dutch members. This will not happen tomorrow,
but I believe we will have to give Rl customers a say in what we
do in their countries. That would create a structure that no other
bank in the world has even tried to create. Every bank says that the
cliënt is king, but Rabobank's raison d'être is what we can do for
our clients. That should be the overriding premise for everything
we do, and for the people whojoin us."
A 'There is a certain amount of resistance from the Dutch member
banks and from Rl itself, but that is based on the misunderstanding
that we would intend to return the capital Rl has generated to
our members, or clients, in the various countries with no strings
attached. That is not the case. However, if we can prove that a
cooperative-like model works for Rl and we introducé it carefully,
step by step, people will see that it can indeed work. All of our
clients, or at least those that wish to be involved, should have some
say in what we do. That is what makes Rabobank unique."
A "I trust that Piet will continue on the course we have set out. He
has been my colleague over the past 6.5 years, and he strongly
supported our strategie choices. Piet is a cooperative banker both
by birth and conviction, whereas I chose it at a later stage of my
banking career. We both truly believe we are on the right track
and ifwe can stay true to Rabobank's roots and the cooperative
ethos, we could achieve something quite momentous.
Something no other bank has done, or even tried to do."
issue 20 THE WORD