Rabo FondsEffect: a new way of investing
Increase in operating profit
Robeco Group
Robeco funds concentration provides transparency in
cost structure
Asset management and investment 43
expense of the number of orders placed through advisers and by
telephone. In 2003, orders placed via the advisors at local banks declined
to 35% and the number of orders placed via the Rabo Orderlijn to 17%.
Apart from the 1.8 million orders for securities and options, orders for
Robeco funds from clients of the local banks were also transacted last
year. The number of orders processed for Robeco funds declined by
14% to 1.0 million.At Alex, the number of investment orders increased,
with its clients placing more than 2.0 million orders, up more than 20%
on 2002.
In 2003, Rabobank introduced Rabo FondsEffect,a new initiative
providing investors with active and personal advice. Rabobank monitors
not only the client's portfolio but also the returns. If the portfolio requires
adjustment, the investor is informed. With the introduction of Rabo
FondsEffect, Rabobank has taken a further step in implementing its new
securities services.
Operating profit from asset management activities increased by 24% to
EUR 157 (127) million. Income rose by 6%, operating expenses by 1%.
The branded fund Robeco is the Dutch market leader in investment
funds and is one of Europe's biggest funds. Besides offering investment
funds for private clients, Robeco also provides asset management
services to institutional clients.With a lower return than the benchmark,
Robeco failed to meet expectations last year. The fixed-interest funds,
including Lux-o-rente, performed much better.
Institutional clients account for more than half of the assets managed
by Robeco. In 2003, total assets managed by Robeco increased by 9% to
EUR 108 billion, of which approximately 35% originated from the United
States.The growth was affected by the depreciation of the US dollar.
Adjusted for this effect, the increase was 16%. Robeco benefited
especially from the higher demand for alternatives, such as CDOs.
Transtrend, the hedge fund manager acquired in 2002, had an excellent
year, with both assets managed and profit more than doubling. Robeco's
profit for 2003 was EUR 168 million. After a disappointing year in 2002,
this is a strong improvement, which was partly due to cost saving
measures and flourishing income from alternatives.
In 2003, Robeco decided to streamline its range of European funds on
offer. A focused product range makes Robeco attractive for collaboration
with other banks in Europe.
The general trend in Europe is for banks to offer third party funds besides
their own funds. Its reputation and independence allow Robeco to fully
benefit from market developments. Another trend is the falling demand
for relatively small, specialised investment funds. Larger investment
funds are able to achieve a better spread of their assets. For that reason,
a number of Robeco funds are being transferred from the Netherlands
to Luxembourg, to be integrated with comparable Robeco funds there.
Rabobank finalises 'Vision 2005+',
the vision for the local Rabobank
of the future.
