Rabobank profits in Ireland fall 28% to €36m

Profits at the Irish subsidiary of the Dutch financial co-operative Rabobank declined by 28 per cent to €35.9 million last year due to a fall in inter-group assets and the sale of bonds.

Accounts published on Friday for Rabobank Ireland plc, which has been renamed as Rabo Ireland, show that its operating income reduced to €60.2 million from €72.7 million a year earlier.

Its net interest income for the period was €54.8 million, a reduction of €10 million year-on-year, reflecting changes in liquidity costs and a reduction in the level of assets held.

The bank’s total assets decreased by €3 billion to €8 billion, reflecting a decrease in the available-for-sale financial assets and lending to other Rabobank entities.

Banking licence

As previously reported by The Irish Times, Rabobank returned its local banking licence to the Central Bank of Ireland earlier this year. Its corporate banking business was transferred to the Irish branch of the group, Rabobank Dublin.

These changes are part of Rabobank’s global initiatives to reduce costs. The bank said it would continue with its successful Irish corporate banking business, “maintaining Rabobank’s strong position in the food and agri sector”.

The bank’s operating costs rose by €1 million last year to €19.4 million due to an increase in banking licence and regulatory compliance costs. Its impairment charges were reduced from €2.1 million in 2014 to just €100,000 last year.

The bank paid corporation tax of €5.1 million during the year, down from €6.6 million in 2014.

No dividend

No dividend was paid to its Dutch parent last year, unlike in 2014 when a sum of €150 million was paid.

The accounts show that Rabobank had an average 85 employees staff here last year, with staff costs amounting to just more than €10 million. Compensation paid to executive directors and key management personnel rose to €527,000 in 2015, up from €448,000 a year earlier. Directors remuneration was unchanged at €248,000.

Rabo Ireland operates separately to RaboDirect, which has about 90,000 customers in Ireland with deposits of almost €6 billion.