Financial results
Net profit up 16%
42 Rabobank Group Annual Report 2005
Core activities: leasing
Heliview research agency has surveyed the performance of car lease
businesses in the Netherlands. Translease, De Lage Landen's car lease
subsidiary, came out on top with an overall score of 7.5. Translease was
one of the first companies to include hybrid cars in its range. Translease
further expanded its car leasing activities with the acquisition of a 66.5%
interest in Prisma Car Lease. Also, an agreement was concluded under
which De Lage Landen will eventually acquire the remaining 33.5% of
Prisma's equity.
America
Due in part to the stronger dollar, the activities in the United States grew
by 31% to EUR 7.6 (5.8) billion. The health care and food agriculture
sectors had an excellent year and the activities in Canada and Brazil sho
wed strong growth as well. As a result of its expansion in recent years,
De Lage Landen is now 6th in the United States in terms of sales volu
me. This Rabobank subsidiary is the largest foreign lease business in the
United States.
In the year under review, a number of new clients with international
operations were added to the portfolio, including high-profile enterprises
such as Hyundai, Panasonic and Sony. The collaboration with AGCO,
which specialises in the production and distribution of agricultural
equipment, continues to be successful. After a few years' absence in
Argentina, De Lage Landen decided to relaunch its activities in that
country, again together with AGCO. In the US, a new public finance
business unit was started in 2005. It offers various lease products to
central, federal and local authorities.
Asia
The portfolio in Asia grew from around EUR 150 million to more than
EUR 250 million. De Lage Landen expanded its activities in 2005 with a
branch office in Japan. In China, the permits to undertake leasing
activities have been obtained. The first office was opened in Shanghai in
January 2005.
De Lage Landen's net profit for 2005 was EUR 178 (154) million, a rise of
16%. Revenues were up 12% at EUR 719 (641) million, mainly due to
higher interest income. Despite a slight narrowing of the interest margin
in 2005, net interest income recorded healthy growth of 12%, rising to
EUR 514 (458) million.
Total expenses were EUR 29 million higher at EUR 392 million, largely as
a consequence of higher staff costs. The other operating expenses
increased a little to EUR 148 (145) million. The staff costs were up 12% at
EUR 244 million, the combined effect of 11% growth in the number of
FTEs and regular salary increases.
Value adjustments, which are a measure of the risk-related costs,
increased by EUR 6 million to EUR 92 million, which equates to 65 basis
points of the average lease portfolio.
Operating profit before taxation rose by 22% to EUR 235 (192) million.
Lease portfolio by region at year-end 2005
Europe
America
Asia, Australia and
New Zealand
Lease portfolio by sector at year-end 2005
Food agri
Office equipment
Bank outsourcing
Materials handling construction
equipment
Healthcare
Translease
Trucks trailers
