A simple business model,
basedon simple products
and excellent service 9
v v
[D is Gert Bouwman?
Could you explain what IDB
does and how the bank's funding
strategy has changed IDB's
business model?
El
strategie course?
Are there differences between
the regions and does this influence
the way you work there?
What are your immediate
priorities?
El
with other parts of the bank?
A "l've worked for Rabobank for around 13
years. I started in Group ICT and then I was
involved in the start-up of direct banking
in the Netherlands. Before that, I worked
for the American computer firm Unisys,
mainly in systems development, sales and
strategie consultancy. So I suppose the mix
of experience in direct banking, marketing
and business development, plus sales and
strategy, is why I was asked to help set up
IDB. I'm married, with twosonsof 18 and 20,
and I live on a small farm in Muiderberg, a
town not far from Amsterdam. I suppose my
entrepreneurial instincts - and my Food and
Agribusiness roots - date back to working in
the shop of my father's dairy business when
I was a child."
A "IDB has a very simple business model,
based on simple products and excellent
service, with all banking products sold
through the internet in Belgium, Ireland,
New Zealand and Australia. We also have
call centres, manned by local staff, and local
back offices. That local presence in the same
country as your customer base is essential
for a successful internet bank. We're also very
active through social media, which gives us
the chance to get closer to our customers.
We want to be where our customers are!
Rabobank's funding drive hasn't changed
this model. What has changed is that IDB is
now seen as a mainstream business line.
We are expected to grow, by attracting more
deposits, and by developing a mature, multi-
product offering. And we have plans to open
internet banks in at least three more countries
in the next year. So what has really changed
is the level of ambition for IDB."
A "Our strategy is now fully aligned with RI's
growth strategy. The credit crisis and Basel III
means Rabobank will need billions in
additional retail funding to meet its growth
targets. IDB is expected to eventually raise a
large percentage of that funding. An essential
part of our strategy is to make sure that the
funds we raise through deposits are 'sticky',
funds we can rely on over the long term. To
do that we have to compete on more than
just interest rates. Luckily, we have a great
story. Rabobank's Triple A status, its core
business values and cooperative identity are
unique differentiators for us. As importantly,
we're not a typical internet bank pulling in
funds and sending them back 'home'. We
invest the deposits in local F&A businesses,
through RI's Rural Retail business. That has
a major impact on the loyalty of our local
customers."
A "Yes, certainly. Every country is different and
the customers in each country are different.
We are a global business line with one shared
business model, so of course we share global
resources, like IT and product and business
development, which helps us keep costs low.
collaborate wherever we can. For instance,
we have relatively large marketing budgets.
We can both benefit from this and raise the
profile of Rabobank at the same time. Don't
forget that while Rabobank is a major player
in the Netherlands, we're quite small every-
where else. And of course, we work very
closely with Rabobank Group and outsource
matters such as Treasury to the local and
central experts at GFM and Corporate
Treasury."
A "To grow and mature the existing banks
and prepare for the opening of new banks.
To grow, we also need to build on existing
customer loyalty, so that when we launch
new products, such as simple investments, we
can attract more funds from our existing cliënt
base, as well as win new customers. We stalled
slightly during the crisis, and our rivals haven't
But we have to localise our business to make
it work. For all our customer-facing activities,
including marketing, for instance, we use local
people who understand the local culture.
Retail banking is all about understanding
customer behaviour, trust, service excellence
and a unique customer experience. And again,
you have to keep it simple and transparent.
We have to accept that not all customers will
want to bank with us. So we have to stick
to our business model and not try to be all
things to all men. We need to focus on what
we do best. That's true for every country."
A "Our cooperation with RI's country busi
nesses is a key success factor. This is why we'll
first focus on opening new internet banks in
countries where Rabobank is already active.
We always share local services like HR, Finance
and local IT. Again, our targets are very much
aligned with the funding needs of the local
Rl businesses, so it makes perfect sense to
stood still, so we have some catching up to
do. Of course, it helps that in Berry Marttin
we have a champion at the highest level, as it
will take time and a lot of commitment from
Rabobank to continue to grow and develop
IDB. But if we can replicate the success of the
current internet banking businesses we run in
the Netherlands as well as abroad, and I think
we can, IDB will become the funding engine
for RI's continued growth. It's a big challenge,
but if you're passionate about it, this is a
very exciting time to be working for IDB, and
Rabobank."«
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ISSUE 27 MAY 2011 RI WORLD
