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Contents Foreword Management report Corporate governance
6.2.1 Credit portfolio
In Table 17, the credit risk to which Rabobank is subject is
presented. No collateral or any other measures for mitigating
credit risk is taken into account. In some cases the amounts
deviate from the carrying amounts, since the outstanding
equity instruments are not included.
Comparative figures in the tables in this paragraph have been
adjusted by reversing the netting of notional cash pooling
productes that took place in 2015. More information can be
found in paragraph 2.1 Basis of preparation in the Consolidated
financial statements.
Table 17: Credit Risk.
Maximum credit risk
31 December 2016
31 December 2015
Total gross
exposure
Average
gross
exposure
Total gross
exposure
Average
gross
exposure
Loans to customers
452,807
459,400
465,993
463,891
Debt securities
33,745
35,292
36,838
37,665
Derivative financial
instruments
42,372
45,243
48,113
52,301
Due from other banks
25,444
28,939
32,434
39,198
Cash and cash equivalents
84,405
74,674
64,943
54,176
638,773
643,547
648,321
647,231
Credit-related and
contingent liabilities
62,760
62,408
62,056
57,852
Total
701,533
706,056
710,578
704,874
Consolidated Financial Statements Company Financial Statements Pillar 3
Off-balance sheet financial instruments
Guarantees and standby letters of credit which Rabobank
provides to third parties in the event a client cannot fulfil its
obligations vis-a-vis these third parties, are exposed to credit
risk. Documentary and commercial letters of credit and written
undertakings by Rabobank on behalf of clients authorise third
parties to draw bills against Rabobank up to a present amount
subject to specific conditions. These transactions are secured
by the delivery of the underlying goods to which they relate.
Accordingly, the risk exposure of such an off-balance sheet
instrument is lower than that of an on-balance sheet exposure,
(e.g. a direct loan). Obligations to grant loans at specific rates
of interest during a fixed period of time are recognised under
credit granting liabilities and accounted for as such unless these
commitments do not extend beyond the period expected to
be needed to perform appropriate underwriting, in which case
they are considered to be transactions conforming to standard
market conventions.
Rabobank is exposed to credit risk when it promises to grant
lending facilities. The size of such losses is less than the total of
the unused commitments, as promises to grant credit facilities
are made subject to the clients meeting certain conditions that
apply to loans. Rabobank monitors the term to expiry of credit
promises, as long-term commitments are generally associated
with a higher risk than short-term commitments.
Table 18: Residual contractual maturity breakdown at 31 December 2016.
Residual contractual maturity breakdown (excluding credit related and contingent liabilities)
At 31 December 2016
Loans to
customers
Debt securities
Derivative
financial
instruments
Due from other
banks
Cash and cash
equivalents
Total
On demand
20,459
43
8
4,442
83,032
107,984
Less than 3 months
42,397
3,361
4,500
18,882
1,362
70,502
3 months to 1 year
40,350
3,313
3,033
1,295
11
48,002
1 to 5 years
92,451
17,621
9,798
556
120,426
More than 5 years
257,150
9,407
25,033
269
291,859
Total gross exposure
452,807
33,745
42,372
25,444
84,405
638,773
Table 19: Residual contractual maturity breakdown at 31 December 2015.
Residual contractual maturity breakdown (excluding credit-related and contingent liabilities)
At 31 December 2015
Loans to
customers
Debt securities
Derivative
financial
instruments
Due from other
banks
Cash and cash
equivalents
Total
On demand
28,351
49
6
4,532
63,650
96,588
Less than 3 months
50,550
2,385
3,071
24,234
1,284
81,524
3 months to 1 year
37,948
3,344
2,870
1,878
9
46,049
1 to 5 years
89,345
18,699
11,226
1,300
120,570
More than 5 years
259,799
12,361
30,940
490
303,590
Total gross exposure
465,993
36,838
48,113
32,434
64,943
648,321
328 Rabobank Annual Report 2016