Outlook
Contents Foreword Management report Corporate governance
Consolidated Financial Statements
Company Financial Statements
Pillar 3
Operating expenses up 2%
Total operating expenses in the leasing segment rose to
EUR 932 (916) million. Due to the sale of Athlon in December,
the total number of employees decreased to 4,675 (5,824)
FTEs, but Athlon still contributed to DLL staff costs until
November. In 2016, staff costs showed a modest rise to
EUR 616 (601) million, mainly related to regular yearly salary
adjustments. Other administrative expenses were higher, at
EUR 285 (277) million, due in part to higher costs for regulation
and supervision. Lower depreciation of intangible assets led to
a decline in depreciation to EUR 31 (38) million.
Loan impairment charges up 19%
Loan impairment charges for the leasing segment increased
to EUR 101 (85) million in 2016. Despite this increase, charges
remained at a relatively low level, which becomes clear
when expressed in basis points of the average portfolio.
Loan impairment charges for 2016 amounted to 30 (25) basis
points, well below the long-term average of 66 basis points.
As DLL's lease portfolio is spread over more than 30 countries
and eight industries, the risks are also well diversified. In 2016,
there were no new significant individual default cases.
DLL's vision is clear; they intend to be the world's best global
vendor finance company. To help DLL get there, they have
set out a strategic path in its Mid- Term Plan (MTP) 'Focus
and Accelerate'. It stipulates that DLL will focus the majority
of its resources, investments, and innovations on its leading
global vendor finance business. And that it will accelerate
its value delivery to customers by providing new and
innovative products and digital tools, as well as first class
customer experiences. The core vendor finance business will
grow modestly across all business lines and profitability will
remain robust.
Throughout 2017, DLL will continue to focus on the businesses
of its partners, specialising in their markets and helping them
sell more products and services with finance and leasing.
This focus has been the key to DLL's success for over 45 years
and will continue to be for decades to come.
By providing new and innovative digital tools and excellent
customer experience, all delivered by an empowered and
engaged workforce, DLL will continue to differentiate its
offering in a growing, highly competitive market and create
greater synergies with its parent company, Rabobank.
DLL expects modest growth of the loan portfolio as a result of
the growth of the vendor finance business. It is expected that
the loan impairment charges will move more towards the long
term average. DLL strives to further expand its Dutch activities
and the share of Food Agriculture in the lease portfolio.
45
Our output and impact: improving performance