Rabobank has shut down its equity derivatives division to focus on ‘core strategies’ after predicting low future revenue potential.
Rabobank Global Financial Markets took an "in-depth" look at the equity derivatives business and is convinced that it makes a limited contribution to Rabobank International’s key strategic goals of becoming the number one wholesale bank in the Netherlands, and the leading player in the food and agriculture industry.
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At the same time, the new regulatory and compliance rules surrounding structured products, especially when sold to private clients, have raised both the perception of potential reputational risk and costs.
Combined with declining revenue opportunities, this makes the business’s likely future contribution to the financial performance of Rabobank International marginal at best. As a result we have decided to exit the business. This is subject to approval of the works council and other internal approvals.
Rabobank announced in a statement that there has been a "change in strategic direction" for the lender, and "the equity derivatives business has been a positive contributor to Rabobank in the past".
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