Improving performance
Our output and impact
Real estate
Favourable developments in the real estate market
In 2016 the Dutch, as well as the German and French real estate markets saw more transactions,
a shortage in the supply of residential units for sale and a relatively low volume of new houses built.
This caused shortages in some regions of the market, which pushed up house prices by approximately
5% in 2016. For area developer BPD, these conditions resulted in an increase in the number of
residential units sold by 18% to 9,905. Several new fund initiatives were started at Bouwfonds
Investment Management (Bouwfonds IM), where the reduction of non-strategic activities was further
continued. On balance, these movements caused the assets under management at Bouwfonds IM to
decrease to EUR 5.9 billion.
In 2016, Rabo Real Estate Finance was launched, a new real estate finance organisation composed of
FGH Bank and Rabobank. In 2016, FGH clients who fit within the real estate strategy of Rabobank were
transferred from FGH Bank to Rabobank Real Estate Finance this year. This process will continue in 2017
and we are doing our utmost to ensure seamless migration for customers.
FGH Bank's integration into Rabobank has led to a reduction in staff. The dotation to the provision
made for this reduction raised other administrative expenses. On 31 December 2016, the loan portfolio
amounted to EUR 11.3 billion, a decrease of EUR 4.0 billion. This decrease lowered net interest income.
The resulting lower gross result was more than compensated by lower loan impairment charges, which
fell by EUR 165 million to minus EUR 75 million, the equivalent of minus 54 basis points of the average
loan portfolio. This is sharply below the long-term average of 94 basis points.
Net profit of the real estate segment increased by EUR 108 million to EUR 288 million. FGH Bank
contributed just over half of the profit of the real estate segment. Of the remainder, Rabo Real Estate
Group brought growth in net profit from EUR 26 million in 2015 to EUR 129 million in 2016.
Contents Foreword Management report Corporate governance Consolidated Financial Statements Company Financial Statements Pillar 3
Real estate profile
Rabo Real Estate Group, FGH Bank and Rabo Real Estate
Finance represent the real estate segment of Rabobank.
Rabo Real Estate Group consists of BPD and Bouwfonds IM.
BPD is responsible for developing residential real estate while
Bouwfonds IM focuses on real asset investments. Rabo Real
Estate Group is active in the Netherlands and, to a much lesser
extent, in France and Germany. Rabo Real Estate Finance is
a new real estate finance organisation that combines the real
estate knowledge and expertise of FGH Bank and Rabobank.
Thanks to its banking knowledge, a broad offering of products
and services, and a vast network throughout the Netherlands,
Rabo Real Estate Finance positions Rabobank as a powerful
player in the Dutch market for commercial real estate.
BPD
BPD develops integral residential areas, small-scale
multifunctional projects and public facilities. BPD strives for
a managed growth in economically strong regions via a local
presence in the Netherlands, France and Germany. It aims for
a market ROIC within an appropriate risk profile. BPD is market
leader in the Netherlands. In France, the organisation operates
under the name BPD Marignan and in Germany, as BPD
Immobilienentwicklung.
46 Rabobank Annual Report 2016
