Rabobank wants out of Irish market but will still 'serve time'
Published 04/03/2011 | 05:00
Rabobank, the Dutch bank that owns ACCBank and the online RaboDirect bank in Ireland, has given the first signal that it could close its Irish operations in a few years.
Its chairman, Piet Moerland said yesterday the bank, which has suffered huge losses as a result of the property crash here, would "serve out its time" here and he joked that if anyone knew of a buyer for ACC, "they should let him know".
Last year, he said the bank had no plans to sell its Irish business but he said it would have to "serve out the next three to five years".
"We want to wait it out and try to recover as much as we can," he said, adding that it could take four to five years before the Irish economy recovers. But he also joked that he would sell it if he could.
He was announcing a 26pc rise in Rabobank's profits to €2.77bn in 2010 after a drop in bad loans and a cost-cutting spree.
Details of how ACCBank performed last year will be issued in the coming weeks when it will show how bad its loans were last year.
In 2009, the bank suffered a €394m loss, an increase of €152m on the previous year, as a result of the property crash and has been involved in a series of high-profile court actions to recover debts.
It has been amongst the most aggressive banks in chasing its massive bad debts through the courts -- securing judgments against property developers, and putting businesses into receivership.
Its parent Rabobank, which is Netherlands second-biggest, warned that stricter banking rules together with massive cuts in government spending across Europe will make 2011 a challenging year for the group.
In the Netherlands Rabobank's retail business, which is the market leader in mortgages and savings, saw profits rise by 52pc.
Its wholesale bank and international banking businesses also performed strongly, booking a 37pc jump in profits to €774m.
The bank's chairman, Piet Moerland said it was facing another difficult year thanks to sluggish economic growth and only moderate growth in lending.
Government cutbacks, falling house prices and tighter banking regulations are adding to this uncertainty he said.
But, he added, "Rabobank's profitability, and therefore our capital position, is expected to remain at an appropriate level."
The bank continues to hold a AAA rating and has been focusing on retaining that rating during the economic downturn.
Rabobank was one of the few major Dutch banks to survive the financial meltdown without receiving a bailout from the government even though its losses in Ireland weighted heavily on the group.