Shift in Dutch banks' intragroup positions

Statistical News Release
Date 27 July 2011

In mid-2011, foreign lending of Dutch banks stood at approximately EUR 593 billion. DNB statistics show that about 45% (EUR 270 billion) thereof was accounted for by loans to their own foreign subsidiaries or branches, so-called intra-group positions. Conversely, the Dutch banking sector received approximately EUR 604 billion in foreign funds, some 41% (EUR 250 billion) of which from own foreign entities.

Intra-group positions arise, for example, when a bank’s Dutch branch temporarily lends money to a subsidiary of the same group based in a different country.  In mid-2011, Dutch banks’ foreign intra-group lending exceeded their intra-group borrowing. The reverse was the case as recently as mid-2010, when net intra-group lending from foreign branches and subsidiaries to banks in the Netherlands amounted to EUR 29 billion. 

Intra-group positions of Dutch banks
A geographical breakdown of this shift shows that by far most of it is clearly retraceable to changes in intra-group positions between branches in the Netherlands and Great Britain.  In mid-2010, intra-group borrowing from Great Britain by Dutch parties on balance amounted to approximately EUR 40 billion. A year later, this net withdrawal of intra-group funds from Great Britain had dropped to EUR 1 billion. This movement may be attributed to internationally operating banks continuously repositioning their treasury management activities, partly in response to changing local economic circumstances.