Risk management
Extremely strong financial position
The financial crisis has brought home once more that risk management is a core
banking competency. Rabobank Group pursues a prudent risk policy that entails a
moderate risk profile. As a result, Rabobank Group was well able to withstand even
the turbulent conditions in 2008 and maintain its capital ratios at a high level.
After obtaining permission from the Dutch Central Bank, Rabobank Group has been
using the most advanced calculation methods since 1 January 2008 for the capital
requirement under Basel II for credit, market and operational risks.
www. ra boba n k.co m/i r
Ample liquidity position
EUR 20 billion raised in long-term funding
Impairment of distressed assets amounts to EUR 570 million
Impact of EUR 653 million on net profit due to impairments of indirect exposure to monoline insurers
Risk management organisation
Risk management is performed at various levels within Rabobank Group. At the highest level, the
Executive Board determines the risk strategy, policy principles and limits, under the supervision of the
Supervisory Board and is advised by the Balance Sheet and Risk Management Committee Rabobank
Group (BRMC-RG) as well as the Credit Policy Committee Rabobank Group.The Supervisory Board
regularly reviews the risk exposure of Rabobank Group's activities and portfolio. The CFO is responsible
for the implementation of Rabobank Group's risk policy. Within Rabobank Group, two directorates share
the accountability for its risk policy. Group Risk Management is responsible for the policy regarding
interest rate, market, liquidity, currency and operational risk, as well as for the credit risk policy at
portfolio level. Credit Risk Management is responsible for the policy for accepting new clients in terms
of credit risk at the individual customer level. Within the Group entities, risk management is the
responsibility of independent risk control departments.
Principles of risk management
The primary objective of risk management is the protection of Rabobank Group's financial strength.
Rabobank Group controls risks in order to limit the impact of potential adverse events, both on its capital
and on its financial results. The risk appetite must be proportional to the available capital. An economic
capital framework has been developed to quantify this. To manage all the different risks, an extensive
system of limits and controls has been put in place within Rabobank Group. Risk management is based
on the following principles:
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Report of the Executive Board
