Wholesale banking and international
retail banking
Strategy and targets
Core activities International wholesale and retail banking focused on food agri
In 2005, the wholesale banking operations and the
international retail banking operations realised a
3% increase of net profit, to EUR 573 (555) million.
This was achieved in a highly competitive market
characterised by pressure on margins. Global
Financial Markets performed well overall. In mid-
2005, this entity integrated the Equities and
Equity Derivatives activities of Rabo Securities in
its operations. 2005 was a moderately good year
for Corporate Finance, partly as a result of the
changed focus of Structured Finance. In the same
period, Gilde Investment Management was sold
to its existing management.
Market and clients
32 Rabobank Group Annual Report 2005
The acquisition of the Community Bank of Central California, which was
announced in 2005, was finalised in early 2006. Also in 2005, a start was
made on expanding the agricultural activities in Brazil. The strategic
collaboration with the Turkish Sekerbank, which was announced in late
2004, fell through in early 2006. Rabobank's intention had been to
acquire a majority interest in order to strengthen its international retail
operations. However, early in 2006 Sekerbank's pension fund - its largest
shareholder - decided against the sale of the shares to Rabobank.
The world economy showed healthy growth in 2005, as it did the year
before. Positive contributions came from the United States and Asia,
with Europe lagging behind again. In Europe, the rise of the short-term
interest rate in 2005 went hand in hand with a decline in the long-term
interest rate, as a result of which the yield curve levelled off slightly.
In the United States this curve levelled off as well due to the steep rise in
the short-term interest rate. Excess global liquidity resulted in increased
competition and tighter margins, the effects of which were felt particu
larly keenly in lending and in the activities of Global Financial Markets.
20% increase in lending
Total private sector lending rose by EUR 9.2 billion to EUR 54.2 (45.0)
billion. A strong contribution to the increase came from the American
region, where lending rose by more than 30%, largely as a result of the
stronger US dollar.
Strengthening the wholesale operations in the positions in countries offering significant potential
global food and agri sector worldwide through in the food and agri markets.
organic growth and selective acquisitions. In the long term, contribution of international
Strengthening the position in the Dutch retail operations to net profit equal to that of
corporate market. wholesale operations
Pursuing structural growth of the international Annual growth in net profit of 10 to 15%
retail operations and realising leading market
