Draijer digs out Rabobank

Dominic O’Neill
Published on:

New Basel rules are set to ramp up the capital burden of Rabobank’s dominant franchise in mortgages and SMEs – assets it previously treated as low-risk. Chief executive Wiebe Draijer tells Euromoney how he is overturning the Dutch mutual group’s corporate structure and business model

Things used to be much easier for Rabobank. The Dutch mutual group has always been under much less pressure to boost return on equity than listed banks. During the crisis, it was  the only big Benelux bank not to need an injection of state capital. Subsequently, it managed to avoid the kind of all-out restructuring its main rivals had to undergo. 

After 2008, Rabobank’s cost-of-funding advantages only widened, as it maintained its triple-A status. Even after this year’s sell-off, yields on its additional tier-1 instruments were exceptionally low compared with peers, according to CreditSights, although the eurozone crisis brought its ratings down a notch. 

But just as the restructuring of fellow Dutch lenders ABN Amroand ING has started to show benefits, Rabobank is now facing equal or bigger challenges than those banks. The largest lender in one of Europe’s biggest mortgage markets, Rabobank is in danger of...