Banking in a changing environment
The credit crisis has left deep marks on the environment within which
Rabobank carries on its banking operations. Confidence in the financial
sector has been adversely affected. In the Netherlands, the banking land
scape has changed drastically and the economic outlook has deteriorated.
Moreover, banks are facing stricter regulation in the areas of solvency
and liquidity, making it harder for them to increase lending. Limits to the
growth opportunities have resulted in an even greater focus on core
activities at Rabobank Group.
Investing in confidence
Financial institutions around the world have had to contend with an image problem since the
credit crisis began. The financial sector has been accused of not fulfilling its duties in the area
of risk management, operating a bonus policy that the rest of society cannot understand, and
failing to ensure that it performs its social role properly. Furthermore, the transparency of
financial products had to be improved. Much of the criticism voiced in response to the credit
crisis has been aimed at banking institutions that mainly operate in Anglo-Saxon nations, but
there has also been criticism of European banks. The challenge for all involved is to find a way
to re-establish the sector's relationship with society and politicians.
Rabobank Group has also been affected by the credit crisis, although it has maintained its
sound capital position. Rabobank Group continues to enjoy the confidence of the financial
world, and in particular institutional investors, as shown by its success in raising over EUR 40
billion in long-term funding at relatively favourable rates during 2009.
Rabobank will continue to invest in retaining, and where necessary regaining, the trust of
its clients, particularly now the industry's image is damaged. Rabobank Group attaches great
importance to its duty of care towards its clients, who can depend on it to offer high-quality,
transparent products, provide appropriate expert advice and handle complaints properly.
Clients in turn need to carefully consider their financial requirements and the risks they are
prepared to accept. By following the Dutch Ombudsman for Financial Services' recommenda
tions concerning OpMaatHypotheek-C (to-measure mortgage), Rabobank has tried to ensure
its clients ongoing confidence in the services provided by the bank.
Changing banking landscape
The Dutch banking landscape has not escaped the credit crisis unscathed. Financial institutions
have been nationalised by the government, received injections of capital and/or obtained
guarantees for part of their investment portfolios, while at the same time they have made use
of state guarantees for issuing debt securities. Rabobank did not make any use of arrangements
of this kind. The bank has been able to operate in the market entirely independent, although it
should be noted that a complete level playing field can hardly be said to exist anymore in
such circumstances. The biggest banks that currently receive state aid are expected to focus
on the Dutch market to a significant extent, and this will lead to fiercer competition in the
domestic market.
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Banking in a changing environment