Financial results
Income up 16%
Operating expenses up 18%
Ambitions and outlook
Total income rose by 16% to EUR 836 (718) million thanks
to the growth in assets managed and held in custody.
Interest income rose by EUR 25 million to EUR 86 (61)
million and commission income increased by 8% to EUR 648
(600) million. At Robeco, the growth of assets managed
and the shift towards equity funds both ensured higher
management fees. As Robeco launched fewer alternative
investment products in the year under review, the related
income was down. Alex handled substantially more orders
in 2006 than a year ago. The effect was a rise in commission
income for Alex, despite a reduction in its fees. Other
income increased by EUR 45 million to EUR 102 (57) million.
Operating expenses were 18% higher at EUR 551 (468)
million, mainly due to the increase in staff costs. At 31
December 2006, Sarasin employed approximately 1,120
FTEs. These additional staff, the expansion of activities and
the increased deployment of staff in 'in control' projects
caused the staffing level to rise by 1,328 FTEs to 3,126
(1,798) FTEs.
Results (in EUR millions)
2006
2005
change
Interest
86
61
41%
Fees and commission
648
600
8%
Other income
102
57
79%
Total income
836
718
16%
Staff costs
330
278
19%
Other administrative expenses
210
177
19%
Depreciation
11
13
-15%
Operating expenses
551
468
18%
Gross profit
285
250
14%
Value adjustments - -
Operating profit before taxation
285
250
14%
Taxation
62
76
-18%
Net profit
223
174
28%
Number of orders in NL (in millions)
8.6
6.1
39%
31-Dec-06
31-Dec-05
Assets managed and held in custody
286
224
28%
(in EUR billions)
For clients
214
156
37%
Investment portfolio
72
68
6%
FTEs
3,126
1,798
74%
Staff costs rose by 19% to EUR 330 (278) million as a result
of the growth in staff numbers, higher costs of external
hires and standard salary increases. Higher marketing costs
contributed to the 19% increase in other administrative
expenses to EUR 210 (177) million. Depreciation charges
fell by EUR 2 million to EUR 11 (13) million due to lower
depreciation of buildings.
Robeco plans to expand its foreign institutional sales
capacities and funds distribution further in 2007. Robeco's
Younique investment concept is expected to contribute to
further growth of the direct distribution channel in the
Netherlands. Robeco may enter into new joint ventures or
make acquisitions to increase its investment expertise or
expand its distribution capacity. In line with the extension
of third-party distribution, a lower margin on management
fees is expected. As for new country entries, Robeco will
follow Rabobank where possible. Robeco will invest in
emerging markets to a limited degree only.
Sarasin will continue its growth strategy and its independent
operations in 2007. Alex expects that more investors will
use the Internet for their investments in 2007. Although
this offers sufficient perspectives for growth, Alex foresees
continued fierce competition between providers of these
online investment services. By deepening its relationship
with the local Rabobanks and by attracting new high net-
worth clients, Schretlen Co expects to grow its customer
base further.
For more information
www.robeco.com
www.sarasin.com
www.alex.nl
www.schretlen.com
50 Rabobank Group Annual Report 2006
