Contents Management report Corporate governance Consolidated financial statements Financial statements Pillar 3
mutual coordination between banks for establishing interest
rate benchmarks. Rabobank continues to comply with all its
obligations under these settlement agreements.
Rabobank, along with a large number of other panel banks
and inter-dealer brokers, has been mentioned in connection
with a number of class action suits and individual civil court
cases brought before the Federal Courts in the United States.
These proceedings relate to the US Dollar (USD) Libor, British
Pound Sterling (GBP) Libor, Japanese Yen (JPY) Libor, Tibor (note:
Rabobank was never a member of theTIBOR panel) and Euribor.
In 2014, an Argentinian consumer protection organisation
brought an alleged class action suit against Rabobank in
Argentina in relation to USD Libor. Rabobank has also been
summoned to appear before several Dutch courts in civil
proceedings relating to EURIBOR. Furthermore, various
individuals and entities have made a number of allegations
relating to Euribor in letters to and legal proceedings against
Rabobank and/or an Irish subsidiary.
Since the alleged class action suits and civil proceedings listed
above, which have been brought before the courts in the US or
elsewhere, are intrinsically subject to uncertainties, it is difficult
to predict their outcomes. Rabobank takes the stance that it has
substantive and convincing legal and factual defences against
these claims. Rabobank has the intention to continue to defend
itself against these claims.
Fortis
'The Dutch Investors'Association'(VEB) has issued a summons
against the company formerly known as Fortis N.V. (currently
trading as Ageas N.V.), the underwriters involved - including
Rabobank - and the former directors of Fortis N.V.The VEB
states in this summons that investors were misled by the
prospectus published by Ageas N.V. in connection with its rights
issue in September 2007. The VEB states that the impact and
risks of the sub prime crisis for Fortis and its liquidity position
were misrepresented in the prospectus and has requested
a declaratory judgement stating that the defendants acted
illegitimately and must therefore be held liable for the loss
allegedly suffered by investors in Fortis. We maintain the view
that the aforementioned loss of EUR 18 billion has not been
properly substantiated.The proceedings concern a settlement
of collective loss, which means that the court will only rule on
the question of whether the defendants, including Rabobank,
are liable. Depending on the outcome of these proceedings,
it will become clear whether separate loss proceedings are to
be expected. Rabobank is defending itself against the claim; at
present, however Rabobank is unable to assess the outcome of
these or any subsequent proceedings.
Interest rate derivatives in the SME segment
Rabobank provides interest rate derivatives for business
customers who wish to reduce the interest rate risk associated
with variable (e.g. indexed Euribor) loans. Such an interest rate
swap protects customers from rising interest rates and helps
businesses to keep their interest payments at an acceptable
level.
For business customers who have both a loan and an interest
rate derivative, the bank (re)assessed the individual position
in 2014 and 2015. If a closed interest rate derivative no longer
suits the customer's requirements, the bank and the customer
set out to find a solution which is acceptable to the customer.
Solutions vary from adjustments to the transactions to
termination or (partial) compensation. Each of these solutions
is tailor-made, which means that all the circumstances of a case
known to Rabobank, as well as knowledge of the company
concerned, are considered in the assessment. In December
2015, Rabobank took note of the conclusion by the AFM that
the banks' revaluations of the interest rate derivatives are
unsatisfactory. It has found shortcomings during its own testing
of the revaluations. Rabobank is currently working with the AFM
on a suitable solution to the situation that has arisen.
Rabobank is involved in civil proceedings in the Netherlands
relating to interest rate derivatives. The majority of these
concern individual cases. In addition, there is a pending
collective action against all Rabobanks concerning accusations
with regard to interest rate derivatives, including accusations
with regard to Euribor. Rabobank will defend itself against all
these claims.
Furthermore, there are pending complaints proceedings against
Rabobank regarding interest rate derivatives brought by Kifid
(Dutch Financial Services Complaints Authority, which, in
January 2015, opened an enquiry window for businesses with
interest rate derivatives).
BSA/AML
In 2015, Rabobank concluded a written agreement with
the Federal Reserve Bank of New York and the New York
Department of Financial Services. Under this agreement,
Rabobank is required to, amongst other things, improve the
BSA/AML (Bank Secrecy Act/Anti-Money Laundering) framework
for its American company. In 2013, Rabobank, N.A. (RNA),
a group company, almost entirely owned by Rabobank, agreed
to a Consent Order with the US Office of the Comptroller
of the Currency with regard to its BSA/AML programme.
American authorities are investigating the BSA/AML compliance
programme of RNA as well as the historical conduct and
210 Rabobank Annual Report 2015
