After returning a significant profit in 2011 Private Banking in The Netherlands showed a decrease in profitability by 29% to EUR 0.5 million in 2012.
This was mainly due to significant investments in marketing and process management, prompted by a comprehensive customer satisfaction study in 2011. The study showed that more and more customers were interested in tailored and pro-active liaison to meet their product requirements and that efficiency could be improved.
This led the unit to differentiate more between private individuals and social organisations – like religious institutions, foundations and charities – and strengthen underlying investment processes. This leads to improved efficiencies, allowing the team to focus on the growing number of clients that commit substantial funds to Triodos Bank.
The Belgian results of Private and Personal Banking is fully consolidated in the branch figures.
Building on co-operation
Triodos Private Banking continued to cooperate with foundations and religious institutions so their financial assets align better with their mission. Cooperation with a leading Dutch charity, NSGK, to run a new guarantee scheme performed very well for example.
NSGK holds a dedicated deposit which Triodos Bank uses to lend to entrepreneurs working in areas that match the mission of both NSGK and Triodos Bank. Throughout 2012, loans totalling EUR 410,000 were extended to six entrepreneurs, who would otherwise face significant challenges to access credit. All loans performed well in 2012. Triodos Private Banking strongly believes that with diminished financial returns on regular investments, charities can maintain their impact by setting up similar schemes.
Although the current investment model for publicly owned corporations and institutions generates a reasonable sustainable return, Triodos Private Banking is investigating alternative ways to boost sustainable returns, together with Triodos Investment Management. After slow progress in the preceding years, significant strides were made to enable implementation of this new investment model in 2014.