De Volksbank posts 2016 net profit of € 329 million


Improvement in our banking franchise: 21% of new current accounts in the Netherlands opened at ASN Bank, Regiobank or SNS; higher market share new retail mortgages; stabilisation retail mortgage portfolio

Update on strategy

  • SNS Bank N.V. renamed de Volksbank N.V. as from 1 January 2017, to
    emphasise the course the bank has set to strengthen its identity as a
    social, people-oriented and sustainable bank
  • Focus on optimising ‘shared value’ for customers, society, employees and our shareholder

Banking with a human touch

  • Improvement in overall customer satisfaction score; several banking
    industry-specific awards; successful rollout of ‘Mortgage term
    monitoring service’
  • Employee NPS of 30% (2015: 34%)
  • 23% climate neutral balance sheet (2015: 20%)

Commercial developments

  • De Volksbank welcomed 136,000 new current account customers: net growth of 88,000 (+7%)
  • Sharp increase in new retail mortgage production to € 3.7 billion
    (+76%); market share new retail mortgages higher at 5.7% (2015: 4.1%);
    retail mortgage portfolio virtually stable at € 44.9 billion
  • 1% decrease in retail savings balances to € 36.6 billion; slightly lower market share of 10.7%

Financial performance

  • Lower net profit of € 329 million (2015: € 348 million), impacted
    by a swing in fair value movements of former DBV mortgages and related
    derivatives (-€ 36 million) and other one-off items
  • The 2016 net profit includes a € 24 million net one-off provision for plans to improve operational efficiency
  • Higher net profit excluding one-off items of € 354 million (2015: €
    335 million), with a substantial release of loan provisions and higher
    investment income more than compensating for the impact of lower net
    interest income and higher regulatory levies
  • The release of loan provisions of € 68 million was mainly driven by
    a sharp decline of loans in arrears (2015: impairment charges of € 37
  • Adjusted efficiency ratio higher at 56.0% (2015: 53.4%) due to lower income; adjusted operating expenses down by 2%
  • Adjusted Return on Equity of 10.3% (2015: 10.7%)
  • Increase in Common Equity Tier 1 ratio to 29.2% (2015: 25.3%); leverage ratio: 5.2% (2015: 4.7%)
  • € 135 million dividend payment for 2016 to NLFI proposed (2015: € 100 million)
In 2016, our continued focus on banking with a human touch has led to a further strengthening of our banking franchise, as evidenced by improvements in our market share in new retail mortgages, customer numbers and satisfaction scores. The quality of our loan book has improved. Consequently, our 2016 net profit benefitted from a substantial release of loan provisions, mitigating the impact of lower net interest income.

Going forward, our ambition is to optimise the value of our bank for all our stakeholders, i.e. customers, society, employees and our shareholder, by strengthening our social identity, lowering our cost base and executing a smart adopter innovation policy. The 2016 results and our strong capital position provide de Volksbank and its brands with a solid basis to put our plans into practice.
Maurice Oostendorp, Chairman of the Board of de Volksbank


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