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The fully loaded common equity tier 1 ratio is the common equity tier ratio if the provisions of
Basel III are fully applied. At year-end 2014 this ratio stood at 11.8% (11,1%).The actual ratio as at
year-end 2014 of 13.6% (13.5%) was at a higher level because various adjustments will be
applied to the capital gradually over the coming years in accordance with the regulations.
The leverage ratio is the tier 1 capital divided by balance sheet positions and off-balance-sheet
liabilities and is calculated on the basis of the definitions in CRD IV. The fully loaded leverage ratio
on 31 December 2014 stood at 3.6%. The fully loaded leverage ratio is the leverage ratio if the
provisions of the new regulations are fully applied. The actual leverage ratio on 31 December
2014 stood at 4.9% (4.8%). This ratio was at a higher level than the fully loaded leverage ratio at
year-end 2014 because various adjustments will be applied to the capital gradually over the
coming years in accordance with the regulations.
Impact of implementation of CRD IV on qualifying capital
in millions of euros
CRD IV
31-Dec-2014
CRD IV
01-Jan-2014
CRD III
31-Dec-2013
Retained earnings
24,528
27,197
27,197
Dividends expected
-119
-119
-119
Rabobank Certificates
5,931
5,823
5,823
Non-controlling interests
28
33
437
Reserves
365
-3,466
-1,089
Deductions
-5,248
-5,931
-3,698
Transitional provisions
3,229
3,294
Common equity tier 1 capital
28,714
26,831
28,551
Trust Preferred Securities lll-VI
1,269
Capital Securities
7,265
Grandfathered instruments
7,283
7,283
Non-controlling interests
6
7
Deductions
-3
-1,993
Transitional provisions
-2,126
-1,992
Tier 1 capital
33,874
32,129
35,092
Subordinated debt
11,738
7,744
7,744
Reserves excluding actuarial reserve
-301
Non-controlling interests
8
9
Deductions
-885
Transitional provisions
-481
-414
Qualifying capital
45,139
39,469
41,650
Risk-weighted assets
211,870
209,536
210,829
Common equity tier 1 ratio
13.6%
12.8%
13.5%
Tier 1 ratio
16.0%
15.3%
16.6%
Capital ratio
21.3%
18.8%
19.8%
Equity capital ratio
14.4%
15.7%
16.1%
Effect of implementation of CRD IV on the qualifying capital
The common equity tier 1 (CET 1) ratio as of 1 January 2014 declined 0.7 percentage point to
12.8%. The full recognition of the actuarial pensions reserve in the CET 1 capital was the main
reason for the decline. In addition, CRR provides new CET 1 deductible items such as deferred
tax assets and the internal ratings based (IRB) shortfall. These adjustments will be phased in
gradually over the 2014-2018 period. A special element in the deductible items is the treatment
of intangible non-current assets which temporarily move from CET 1 deduction to additional
tier 1 deduction.This leads to an initial and temporary increase in the CET 1 ratio. The tier 1 ratio
is not affected.
Annual Report 2014 Rabobank Group
