Rock-solid bank: performance
Domestic retail banking
Economy recovers, service provision becomes more virtual
The Dutch economy showed a fragile recovery in 2014.This was mainly due
to an increase in exports.The temporary increase to the gift tax exemption
and the relatively low interest rates paid on savings led to increased mortgage
repayments. Business investment remained at a low level.
These factors led to the domestic loan portfolio falling by EUR 12.6 billion to
EUR 290.5 billion and amounts due to customers falling by EUR 6.6 billion to
EUR 209.1 billion. Despite the cautious recovery of the Dutch economy in 2014,
bad debt costs at the domestic retail banking business rose by EUR 38 million
to EUR 1,422 million, representing 48 basis points of average lending.
Operating expenses for the domestic retail banking division fell, mainly due
to the sharp reduction in the number of employees resulting from the
implementation ofVision 2016. The net result of the domestic retail banking
division amounted to EUR 751 million, a decline of EUR 30 million compared
to 2013.The net result was negatively affected by the non-recurring resolution
levy of EUR 274 million.
Our market share was under pressure in mortgages, savings and the market
for services to trade, industry and services.The market share in the food and
agri sector remained stable. 2014 once again featured extensive attention to
the further virtualisation of our services. Customers are increasingly arranging
their banking affairs themselves, they need less contact with our staff and
visit our branches less freguently. Virtualisation therefore is associated with a
decline in the number of jobs and branches.
Strategy for domestic retail banking
Our core mission is to be a lifelong, personal financial partner. We strive to win customer loyalty
and thus create ambassadors for our services. We build long-lasting and profitable customer
relationships. It is our ambition to be the bank of choice in the Netherlands for all the common
financial products and services.This is shown by market leadership.
Rabobank is the market leader in savings, as well as in the markets for the funding of SMEs and
food and agri. The bank intends to maintain these leading positions and strengthen its position
selectively in areas where its ambitions have not yet been realised. Although our market share
declined in 2014, with the local Rabobanks and Obvion we still have a strong position in the
mortgage market.
54 Annual Report 2014 Rabobank Group
