Rabobank sees profits drop by 30pc
Tuesday October 09 2007
Dutch-owned Rabobank has reported a 30pc slump in pre-tax profits at its Irish unit, from €55.8m to €39.3m for the year to the end of December 2006.
The bank attributed the reduction in its profits to pressure on interest margins following recent interest rate hikes -- the ECB has foisted eight successive interest rate hikes on the debt markets.
It said that on a positive note, operating expenses have decreased due to a reduction in head office charges. Expenses were down from €26.3m to €14.7m.
It said that assets of the IFSC-based group reached a 12-year high of €28bn in 2005 but that this has reduced to €24.6bn in 2006 as a number of high value structured finance transactions matured and were replaced elsewhere in the Rabobank Nederland group.
The group, which operates in the areas of treasury dealing, structured finance, corporate lending and management, made a net profit of €37.8m, down 26pc on the previous year.
Net interest income at the bank dropped 25pc from €78.9m to €58.7m in 2006.
Operating income also fell significantly, decreasing 31pc to €54.2m, according to the figures.
However, the directors' report noted that operating expenses also fell, declining from €26.3m to €14.7m.
The Dutch group is a major European player.
