SOURCE: Rabobank

March 08, 2006 02:55 ET

Rabobank Group on track: net profit up 16%

Executive Board Chairman Bert Heemskerk: 'All Rabobank Group business units contributed to the profit growth'.

UTRECHT, NETHERLANDS -- (MARKET WIRE) -- March 8, 2006 --

* Net profit: +16%
* Income: +2%
* Expenses: fractionally lower
* Savings: +10%
* Private-sector lending: +12%
* Tier 1 ratio: 11.6
With 16% growth in net profit, Rabobank Group exceeded its long-term target of 12% in 2005. Bert Heemskerk, chairman of the Executive Board: 'We're on track. Despite the changeable economic climate, Rabobank Group has exceeded its profit target. Our commercial operations accounted for the bulk of the profit growth, to which all business units contributed across the Group. We also made significant advances at the strategic level, in the Netherlands and internationally.'

Rabobank Group posted a significant financial result in 2005, with net profit rising to EUR 2,083 (1,793)* million. Income was up 2% and total expenses were fractionally lower. Rabobank strengthened its equity position in 2005 with the issue of new Member Certificates. As with previous issues of Member Certificates, demand was so high that the issue was oversubscribed. Thanks partly to the successful issue of Member Certificates III, the Tier I ratio improved from 10.9 to 11.6. Private-sector lending was 12% higher, at EUR 278 (249) billion, and funds entrusted increased by 5% to EUR 186.4 (177.5) billion.

Last year saw further progress towards the achievement of Rabobank Group's strategic objective for the Dutch market: to be the leading financial services provider across the board. Interpolis was sold to Eureko in exchange for an additional holding in the latter, taking Rabobank's stake in Eureko from 5% to 37% and giving it a substantial interest in the largest insurance company in the Netherlands. The merging of the local Rabobanks, to create larger units which are better equipped to serve their markets, is on schedule. The number of local banks decreased in 2005 from 288 to 248.

At the international level, too, Rabobank Group is on track to become the bank for the global food & agri sector. With the completion last month of the acquisition of Central Coast Bancorp in California, announced in 2005, Rabobank has also become the owner of the subsidiary Community Bank of Central California, which operates an extensive branch network.

Rabobank expanded its operations in Brazil, with the opening of eight branches to service the larger agricultural enterprises. In Tanzania, a consortium consisting of Rabobank and three local partners took a 49% interest in National Microfinance Bank (NMB) under the Rabobank Development Program.

*The figures in brackets in this press release are the figures for the same period in 2004.


***Please open the following link to view the key figures:*** http://hugin.info/133178/R/1038174/168414.pdf

***Please open the following link to view the balance sheet:*** http://hugin.info/133178/R/1038173/168413.pdf

***Click the link below to view the complete press release including tables:***

2005 annual results (http://hugin.info/133178/R/1038165/168407.pdf)



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