Added value of the subsidiaries Identity as strength 'The new Rabobank' 15 Rabobank Group Annual Report 2004 Strategy In the years ahead, Rabobank Group's ambitions in the Netherlands are primarily focused on achieving market leadership via the local Rabobanks. Rabobank Group's subsidiaries and production units will contribute to this by means of multi-distribution and white labelling. In order to be both the leading and the largest all-finance service provider in the Netherlands, the bank's prime focus for the immediate future will be on further strengthening its position in the insurance market. Primarily via the local banks Through the local banks, Rabobank Group occupies an influential and dominant position in many sectors of the Dutch financial retail market. This position is the direct result of having been near to the client and showing strong commitment to clients for over a century. Sustaining and extending that position is not achieved without effort. It is vital to remain alert in order to be able to tackle growing competition and other market developments. For example, in the year under review an effective response was formulated to the rapidly changing client demands in terms of the distribution channels through which they wish to purchase financial services. Channel differentiation and optimisation of the office network are at the core of this. A proper mix of these two elements will result in an increased number of client interface points and lower office space costs. In this way, Rabobank can retain that distinctive characteristic as the 'bank-near-you' in the Netherlands. In this context, further expansion of the virtual bank is expected. The fact is that clients consider Rabobank to be 'near to them' because it is available 24 hours a day, 7 days a week, via the telephone or the Internet. Not surprisingly, users voted the www.rabobank.nl website the best financial website in the Netherlands in 2004. Market leadership through the local Rabobanks has not yet been achieved in certain client groups and geographical areas or in some product markets. That is why in the years ahead the local Rabobanks are aiming at: strengthening the position in the upper range of the private individuals and corporate markets; reinforcing the market positions in large-city areas, particularly among private individuals, ethnic minorities and small and medium-sized enterprises; growing the market share in insurance, consumer credit and real estate; defending the large market share in the agricultural sector. Complementary contribution by means of multi-distri bution, white labelling and cost sharing Complementary to the activities of the local Rabobanks, multi-distribu tion, white labelling and cost sharing can contribute to achieving the desired market leadership in the Netherlands. Concrete multi-distribu tion activities have been undertaken in recent years. For example, Rabobank, in collaboration with the ABP pension fund, formed the mortgage subsidiary Obvion in April 2002 in response to the increased popularity of brokers in the mortgage market. In addition, the well-known Internet broker Alex was acquired from Dexia in 2003. This acquisition not only resulted in a substantial enlargement of the client base with active, price-conscious investors, but also in a significant increase in the number of securities transactions, allowing a major decrease in the cost per order to be realised. The handling of securities transactions for Friesland Bank - an example of white labelling - which was started in 2002, also contributes to the planned reduction in costs. An example of cost sharing in the field of securities is the cross-border platform for securities transactions settlement, which was formed in 2004 together with the Belgian KBC banking and insurance group. The aim of this joint venture is to significantly lower the cost of securities transactions, which will ultimately benefit the clients. The subsidiaries of Rabobank Nederland are expected to make a major contribution towards achieving Rabobank Group's market leadership ambition. Besides attractive returns from their own autonomous activities, their goal is to strengthen Rabobank's strategic position and image both at home and abroad and to improve its overall risk profile. The subsidiaries fulfil the role of competence centres for the local banks. In addition, nearly all of them serve their own client base besides that of the local member Rabobanks. Rabobank expressly uses its cooperative character to achieve market leadership in the Netherlands. The members of the local Rabobanks are tangible evidence that Rabobank is 'a different bank'. This membership creates a unique opportunity for the bank to strengthen its ties with the market. If clients truly experience the bank as 'committed', 'near-you' and 'leading', this offers countless opportunities. It is up to the local banks to define this further, for instance by making maximum use of the ability to consult representatives of both members and clients in member councils, members' meetings and panels. Another possibility is to set up 'communities' locally, i.e. discussion groups around selected issues. The local Rabobanks are accelerating their development into larger and more self-conscious entities that can also serve the upper segment of the market. In the year under review, consensus was reached with the local banks on the outlines of 'the new Rabobank'. This is the out come of the discussion with the local banks on the 'Rabobank Vision 2005+' policy statement for the future, which was jointly finalised in the autumn of 2003.

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Annual Reports Rabobank | 2004 | | pagina 15