(International) wholesale business
Rabobank International
Rabobank Nederland Corporate Clients
35 Rabobank Group Annual Report 2004
Core activities
Lending by sector
Agricultural
Private individuals 5%
Organisational change
The organisation of the wholesale business was changed in 2004 in order
to enhance customer focus and to improve its market position. Group
Treasury, which used to operate independently, was largely absorbed by
Rabobank International, which in turn intensified its collaboration with
Rabobank Nederland Corporate Clients (RNCC). Rabobank International's
primary focus is abroad, whereas RNCC focuses on the Dutch market
and on supporting the local Rabobanks in the corporate market. RNCC's
target group consist of enterprises in the Netherlands with more than 20
employees and turnover exceeding EUR 10 million. It uses the financial
products offered by Rabobank International.
Rabobank International's foreign wholesale operations are divided into
a number of geographical areas. In terms of products, a number of
distinct 'global' product groups are defined, such as Corporate Finance,
Global Financial Markets and Equities. Also, each region is responsible for
its own lending and trade financing products. Rabobank International's
portfolio further consists of participating interests in the funds provided
by Gilde, Rabobank Group's venture capital subsidiary.
Corporate Finance
Rabobank supplements its lending activities with a wide range of
corporate finance products, including structured finance, leveraged
finance and project finance. In doing so, it works closely together with
other subsidiaries and with the local Rabobanks. Structured Finance
offers tailor-made transactions aimed at both the asset and the liability
side of the balance sheet. On an international level, Leveraged Finance
is a major player in the agricultural market, although Rabobank operates
in other sectors as well. In 2004, the portfolio grew, due particularly to
transactions for Advanta and Milk Link. Rabobank attaches great
importance to sustainable and socially responsible business operations.
In 2004, a number of Project Finance transactions for clients of local
Rabobanks were completed, which were aimed at sustainable energy
(wind farms) and green-labelled glass house horticulture, where finan
cing was provided by Rabobank Green Bank.
Global Financial Markets
Global Financial Markets (GFM), which combines all the activities of the
former Group Treasury except long-term funding activities, operates
in the international financial markets - as its name suggests. GFM is
responsible for implementing Rabobank Group's liquidity policy and
advises businesses in the issuance of bonds, debt securities and other
financing constructions including credit derivatives. In addition, GFM
provides hedging for the credit, interest rate and currency risks of clients
and of Rabobank Group. Especially for clients of the local Rabobanks,
GFM placed Asset Backed Inflation Bonds for a total amount of EUR 535
million in 2004. This product compensates investors for the inflation risk
by means of interest payments and the principal amount both being
linked to a European inflation standard. In addition, GFM regularly deve
lops products for Rabobank Group subsidiaries, such as Obvion and
Effectenbank Stroeve. For example, GFM securitised part of Obvion's
mortgages portfolio.
Equities
Equities is Rabobank Group's centre of competence for share-related
products and services that are developed for clients of the local
Rabobanks and for international retail clients and asset managers.
Examples of these products and services are share issues, mergers
acquisitions, share sales trading, share derivatives and share research.
As in 2003, demand for share products grew in the year under review,
with particular interest in guarantee products. For example, the
SolidWorld Bond investment productwas placed especially for retail
clients of ACCBank in Ireland for a total amount of EUR 334 million.
This product has a guaranteed principal amount and returns are linked
to the movement in value of twelve large equity funds.
Apart from serving its own client group, which consists of the large
Dutch corporates, Rabobank Nederland Corporate Clients (RNCC) is also
responsible for supporting the local Rabobanks in serving the corporate
market. In that context, RNCC works closely with 'product supplier'
Rabobank International, which operates in the financial markets and in
corporate finance in the Netherlands as well as internationally, and with
its subsidiary Rabo Securities, which focuses on the Dutch equity market.
Due in part to RNCC' efforts, Rabobank Group's market share in the
corporate segment has shown strong growth over the past five years.
In line with Rabobank's global niche strategy, RNCC focuses on the large
Dutch food agri businesses. In addition, it is responsible for directing
the marketing of the entire food agri operations in the Netherlands.
Traditionally, Rabobank has focused specifically on healthcare and
educational institutions and on government organisations. Likewise, it
is very active in the traditional Dutch trade, industry services sectors.
