Today's LIBOR Rates
1 M |
0.31563 |
 |
3 M |
0.47500 |
|
6 M |
0.68794 |
|
1 YR |
1.06438 |
|
FREE Newsletter
Recommended Links
The Banks Behind LIBOR
Rabobank
March 02, 2009
“Contributor banks” selected by the British Bankers’ Association (BBA) report their daily interbank lending rates for different maturities and currencies, and from these data the BBA computes the LIBOR indices. This is an overview of one of those contributor banks.
Rabobank is a contributor for several of LIBOR’s 10 monitored currencies, including the U.S. Dollar, the Canadian Dollar, the Danish Krone and the Euro. Founded in The Netherlands, the institution is a consortium of credit unions with a central organization that is a “daughter organization” of the individual branches. Rabobank Group encompasses over 160 independent Dutch Rabobank branches and a global network of specialized offices. Per measure of Tier 1 capital—core capital that is primarily equity capital and cash reserves—Rabobank is among the 15 largest institutions in the world.
Specializing in food and agribusiness, Rabobank’s origins are in farming. In 1898, two cooperative banks formed to serve Dutch farmers—the Coöperatieve Centrale Raiffeisen-Bank, a group of 6 banks in Utrecht, and the Coöperatieve Centrale Boerenleenbank, a 22-member group in Eindhoven. The two organizations operated in parallel until 1940, when they began limited cooperation with each other. Demands for more capital and intensifying competition between burgeoning branches spurred the final merger in 1972. The name Rabobank comes from the first letters of Raiffeisen-Bank and Boerenleenbank.
Rabobank Nederland is the domestic unit, serving the needs of the 161 Rabobank branches in The Netherlands. Officially formed in 1996, Rabobank International is the outgrowth of overseas services that began in the 1970s. Rabobank established branches in Europe, Asia, and North and South America. The company purchased banks in Australia, Germany and the United States to further its global reach. Rabobank International currently has over 300 branches in more than 40 countries.
From its beginnings, Rabobank has worked closely with the communities it serves. While its systems and staffing have grown more sophisticated over the decades, the bank’s motto is “As large as is necessary, as small as possible.” True to its heritage, Rabobank commands approximately 90% of Dutch agricultural industry banking. The steady expansion of its expertise and brand is noted in other metrics within The Netherlands: 40% of small to medium business customers; 40% of savings accounts; 20% of mortgages.
The accuracy and relevance of LIBOR rests on its contributor banks. With Rabobank, LIBOR has a constituent that has grown from rural roots to global prominence during the past century.