Well-farming Rabobank grows strongly in agriculture

Rabobank further increased its profit in 2024, thanks to higher interest income and lower credit losses. The bank also saw its global agri and food credit portfolio grow faster compared to 2023. The Dutch domestic market is doing above average with growth of almost 10%. It is also notable that the bank has included a substantial provision for the nitrogen and manure policy in the Dutch agricultural sector. 

After profit had already increased sharply in 2023, it improved by another sloppy 18% last year to a record of €5,16 billion. According to Belgian CEO Stefaan Decraene, the bank owes this mainly to higher volumes, increased interest income and lower credit losses. Interest profit increased in all business units. The interest on outstanding loans fell in many cases last year, but there is still a large gap with the savings interest rates that the bank pays out, which explains the high profits in the past two years. 

The costs of credit losses – the so-called loss pot – were €468 million lower than the €727 that was on the balance sheet for this in the previous financial year. All in all, the bank speaks of strong financial results for 2024. At the same time, the bank is wary of too much euphoria, given the geopolitical tensions and uncertainty about inflation. The latter is a major factor in the interest rates that central banks use and influences credit and savings rates. According to the bank, increasing competition and cybercrime are also factors to take into account in the coming years.  

Strong growth in food and agri
The global food and agri portfolio shows above-average growth of 4% to €119,8 billion, compared to an increase of 1% in the previous financial year. Of this, Rabobank has €46,1 billion outstanding in its own country. The Dutch market grew remarkably fast last year with an increase of almost 10%. The food and agri portfolio gained 1 percentage point market share to 27% within the total portfolio that grew by 3% to €447,3 billion.

Furthermore, the bank reports that it has taken provisions for €225 million. Of this, €110 million has been reserved for climate and environmental risks. It is striking that the reduction targets for nitrogen and manure of the Dutch government are the only risks in this category that are described in concrete terms.

Wouter Job

Wouter Baan is editor-in-chief of Boerenbusiness. He also focuses on dairy, pig and meat markets. He also follows (business) developments within agribusiness and interviews CEOs and policymakers.

w.baan@boerenbusiness. Nl

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