42 Other administrative expenses
43 Depreciation
44 Loan impairment charges
-
45 Regulatory levies
46 Income taxes
-
-
Contents Introduction Management report Appendices Corporate governance Consolidated Financial Statements Company Financial Statements
in millions of euros
2017
2016
Additions and releases of provisions
721
1,063
IT expenses and software costs
751
703
Consultants fees
395
371
Training and travelling expenses
190
168
Publicity expenses
152
160
Result on derecognition and impairments on (in)
tangible assets
119
96
Other expenses
848
915
Other administrative expenses
3,176
3,476
in millions of euros 2017 2016
Depreciation of property and equipment 238 250
Depreciation of intangible assets 168 188
Depreciation 406 438
in millions of euros
2017
2016
Loans and advances to banks
1
Loans and advances to customers
(38)
474
Recoveries following write-off
(152)
(157)
Credit related contingent liabilities
(1)
(7)
Loan impairment charges
(190)
310
In 2017 the loan impairment charges were negative, especially
for the Dutch portfolio, which is mainly caused by the recovery
of the economy which leads to a limited number of new
defaults, recovery of existing defaults and release of part of
the allowances for existing impaired clients due to increased
collateral values.The loan impairment charges of loans and
advances to customers consist of impairments of 1,549 (2016:
2,103) and reversal impairments of 1,587 (2016:1,629).
The regulatory levies consist of bank tax, contributions to the
single resolution fund and the deposit guarantee scheme.
Banks operating in the Netherlands on 1 October of the current
year are required to pay bank tax. There are two rates of bank
tax: A rate of 0.044% for current liabilities and a rate of 0.022%
for long-term liabilities, based on the balance on December
2016. In 2017, Rabobank Group was charged a total of 161
(2016:166). In 2017, the bank levy in Ireland amounted to 7
(2016:4). In 2017, the bank levy in Belgium amounted to 11.
On 1 January 2016 the European Single Resolution Fund (SRF)
was set up. This fund has been established to improve the
effectiveness of resolution instruments. Banks and investment
firms that are in the scope of the SRM-regulation are obliged
to contribute to the SRF. In 2017, the contribution to the Single
Resolution Fund amounted to 184 (2016:180).
Per the end of 2015, the new pre-funded deposit guarantee
scheme was introduced. As of 2016, banks have to pay a
premium on a quarterly basis. Target size of the scheme is 0.8%
of total guaranteed deposits of all banks together. In 2017, the
contribution to the Deposit Guarantee Scheme amounted to
142 (2016: 133).
in millions of euros
2017
2016
Income tax
Reporting period
833
527
Adjustments of previous years
(11)
(6)
Recognition of previously unrecognised tax
losses
(8)
(1)
Deferred tax
144
174
Total income tax
958
694
The effective tax rate was 26.4% (2016: 25.5%) and differs from
the theoretical rate that would arise using the Dutch corporate
tax rate.This difference is explained as follows:
in millions of euros
2017
2016
Operating profit before taxation
3,632
2,718
Applicable tax rate 25.0%
(2016:25.0%)
25%
908
25.0%
680
lncrease/(decrease) in taxes resulting from:
Tax-exempt income
-3.1%
(112)
-4.2%
(116)
Tax rate differences
0.8%
29
2.6%
73
Non-deductible expenses
1.8%
66
2.6%
72
Recognition of previously
unrecognised tax losses
-0.2%
(8)
-0.1%
(1)
Other permanent differences
-0.1%
(3)
-0.4%
(12)
Adjustments of previous years
-0.3%
(11)
-0.2%
(6)
Adjustment due to changes
in tax rates
-1.6%
(59)
Other non-recurring tax items
4.1%
148
0.2%
4
Total income tax
26.4%
958
25.5%
694
The other permanent differences mainly comprise of the
deduction of interest payments on Capital Securities and a local
provision for expected settlement regarding RNA.
Rabobank Annual Report 2017 - Consolidated financial statements
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