Rabobank Nederlands

Rabobank Nederland

INTRODUCTION

Rabobank Nederland is the central bank for a cooperative of banks known as the Rabobank Group. Their main focus of is on loans for agribusiness, which makes up about 90% of their loan base. With total assets of $42 billion, they are among the 50 largest banks in the word. In order to increase their presence in the international market, Rabobank Nederland opened up their first foreign branch in 1981 in New York City. New York was an obvious location because of the access the U.S money markets. Hugo Steensma was put in charge of the NYC branch as the general manager. He was in charge of the 25 employees that worked in the office, and made sure that the account managers were following the policies of the company. He also had the ability to authorize loans up to $5 million. His biggest challenge was balancing allowing his account managers to go out and market in bring in loans, and enforcing the controls of the company to ensure that the accounts that were being brought in were high quality assets.

ACCOUNT MANAGERS

The role of account managers in the NYC branch is defined by two functions. The first function is to go out and identify potential customers for the bank and sell their services to those customers. One of the managers, Roger Barr, mentions that he would go on a week-long trip to visit 12 companies. The second function of the account managers was to perform an analysis on the potential loan and determine the risk factor associated with the loan. The account managers were given autonomy to get their work done, as long as it stayed within the confines of the charter of the branch. There are two critical success factors in order for the account managers to be effective. The first CSF is identifying good leads. In order to close on any loans, there first must be a customer who fits the acceptable criteria to Rabobank. The second CSF for an account manager is performing a sound analysis on the credit worthiness of the customer. Since the company only wanted to have the highest quality assets, it was the account manager’s jobs to determine whether these leads fit within that criteria laid out by the company.

MANAGEMENT CONTROLS

Rabobank uses action, results, and personnel controls to ensure that employees are acting in line with the company’s objectives. Their main objectives were to be an international bank and to have only the highest quality of assets. The following are the controls that they used over their account managers in the NYC branch:

ACTION CONTROLS

Account managers had an administrative constraint put on them that they could not authorize loans over $1 million. Anything over their limit had to be approved by the NYC branch credit committee if it was less that Hugo’s $5 million