“We are moving in the right direction”

Tom de Swaan reflects on a busy year for the Supervisory Board. He talks about the changes in the Executive Board, the bank’s performance and the progress on its strategy. “If you look at the top-line development and the increased sense of urgency to repair legacy issues, our overall assessment is that the performance of the bank in 2024 can be positively judged.”

What kind of year was 2024 for the Supervisory Board?

“It was an extremely busy year. First of all, we are very pleased with the arrival of Serena Fioravanti, who joined the bank as Chief Risk Officer in October, and the intended nomination of Marguerite Bérard as our new Chief Executive Officer. Finding people for the top of the organisation is a very important part of our job.

Secondly, we are engaged in an ongoing dialogue with the Executive Board on its efforts to improve the bank internally. Topics like anti-money laundering, data issues and cost management remained high on the agenda. We are also increasingly exploring opportunities to grow the bank, which led to our approval of the acquisition of Hauck Aufhäuser Lampe (HAL) in Germany.”

Hauck Aufhäuser Lampe will make ABN AMRO one of the largest private banks in Germany. What’s your view on this deal?

“It is a wonderful acquisition, perfectly aligned with the bank’s strategy to strengthen its wealth management business in Northwest Europe. Once completed, it will also increase our ability to generate fee income, which is a good development for several reasons. It doesn’t put pressure on the bank’s capital, and it creates a source of income that is less dependent on external developments such as changes in interest rates. These kinds of inorganic steps are important for ABN AMRO and it should consider such opportunities.”

How do you assess ABN AMRO’s performance in 2024?

“We can be more than satisfied with last year’s performance. Our net interest income remained strong, as interest rates fell less than expected. The top line also greatly benefited from the increase in fee and commission income and our continued outperformance in the Dutch mortgage market, which is the result of our own actions and our capability to add value for our clients. Profitability was also strong thanks to extremely low provisioning due to the resilience of the Dutch economy and strong risk management.

At the same time, it’s clear that costs need a lot of attention. Over the past four years, ABN AMRO has not delivered on the cost budget that was called for. Inflation and other external factors played a major role, but we also need to look at ourselves. Clearly, the bank’s effort to fix legacy issues is taking longer and costing more than originally expected back in 2020. On a positive note, 2024 was a year in which the sense of urgency to repair these issues really took hold.”

How did the bank progress on its legacy issues?

“If you look at data modelling and the management of risk-weighted assets (RWAs), we are moving in the right direction. The ratio of RWAs to our total asset exposure is still too high relative to our peers, which hampers ourability to execute on our strategy.”

What is your view on the Dutch State reducing its stake in the bank to around 30%?

“We see it as a positive sign. It shows that the Dutch government believes ABN AMRO is mature enough to stand on its own feet. At the same time, when your free float of shares increases, people might assume that you are becoming more vulnerable. The only way to counter that is to perform well. The jury is still out on whether there will be cross-border consolidation in the European banking scene. But if it happens, it’s of vital importance that we stand strong. For me, that’s still number one: stay independent. That’s why we have to continue to strengthen, improve and grow the bank.”

Looking at the growth strategy, how is the bank doing on that front?

“The first shoots are clearly there. The acquisition of HAL is a perfect example, and I already mentioned our position in the Dutch mortgage market. We have strengthened our position across corporate clients. When I talk to CEOs in the Netherlands, they all recognize ABN AMRO is doing a very good job in corporate banking. We must think of ways to grow the bank without too much capital. Obviously, there are still issues that must be resolved.”

What has CEO Robert Swaak meant for the bank?

“Robert took over at an exceptionally difficult time. When he started in April 2020, he hadn’t spoken to his colleagues in person because of Covid. He did a good job of keeping people involved and establishing a leadership team even though he could not have face-to-face conversations. I really laud him for what he did there. The decision to focus the corporate bank on Northwest Europe and clients in certain transition sectors was an important step that he prepared and helped execute. Also, he has done a lot to improve the position of ABN AMRO in society. Under his leadership, our sustainability plan has increasingly become part of the foundation of the bank. Finally, he did a tremendous job of renewing the top of the organisation. At this point, all members of the Executive Board were appointed while he was CEO. There can be no doubt that Robert put a stamp on the organisation, and we thank him for his contribution to the continued success of the bank.”

What makes Marguerite Bérard the right person to lead ABN AMRO into a new strategic phase?

“I have a very good feeling about Marguerite joining as our new CEO. Both internally and externally, the reaction to her intended nomination has been very positive and quite rightly so. She brings a lot of experience gained at some of Europe’s largest banks. Given her previous roles in the French government, where she was first an adviser to President Sarkozy and then Chief of Staff to the Minister of Labour, she also has regulatory experience, which is important. I’m also very pleased with our new Chief Risk Officer Serena Fioravanti, who brings a huge amount of fresh air to the organisation. We have an excellent leadership team with the right energy and expertise to build on where we stand today.”

How do you view the performance of the people at the bank in 2024?

“There is no doubt that I highly appreciate the way they are working. They were confronted with quite some changes last year. Nevertheless, their engagement remained very high. People believe in the work they do; they are committed and proud of ABN AMRO. This is an important ingredient in solving the legacy problems and further developing the growth agenda. That’s something we are really pleased about.”