AMSTERDAM, Feb 16 (Reuters) - Dutch lender Rabobank reported underlying full-year profit up 14 percent, boosted by the country’s economic growth and higher international agricultural lending, as its cost-saving restructuring continues apace.
The cooperative bank announced in December 2015 that it would shed 9,000 jobs, then a fifth of its workforce, and reduce its balance sheet by 150 billion euros by 2020 to become more resilient to financial shocks.
The restructuring is “proceeding at high speed”, CEO Wiebe Draijer said in a statement on Thursday after the company reported 2016 results.
“This asks a great deal from our employees. Many of them are seeing their jobs disappear as a consequence of digitalisation of our services and the implementation of much-needed improvements, particularly in the back-office and support functions.”
Rabobank’s underlying profit rose to 4.09 billion euros ($4.34 billion), though net income fell 9 percent to 2.02 billion euros because of restructuring charges and impairments, having shed 6,446 jobs to end the year with 45,567 employees.
The company finished the year with a Tier 1 capital ratio of 13.5 percent and said it aims to achieve a targeted 14 percent ahead of schedule, in expectation of a possible increase in capital requirements under new international regulations.
In January the company issued 1.5 billion euros worth of new cooperative certificates, which are its equity, increasing solvency by an additional 0.8 percentage points.
Rabobank, which vies with ABN Amro as the largest Dutch mortgage lender, has begun selling some of its home loans portfolio to reduce its balance sheet.
”We intend to take more of the loan portfolio off-balance and will continue to reduce the balance sheet in 2017,” it said.
The balance sheet shrank to 662 billion euros of assets by the end of 2016, from 679 billion euros a year earlier. ($1 = 0.9423 euros) (Reporting by Toby Sterling; Editing by David Goodman)