AUGUST 2016

PRODUCT FOCUS

RaboNews Rabobank Indonesia

Banking for Food:Rabobank's global vision and growth strategy»03

Rabo Golfer »10

Seafood: Traceability is Gaining Importance

»08

Rabo Online Personal »07

3290 PROGRAM

HIGHLIGHT

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MARTYN H. SCHOUTEN President Director/CEO Rabobank Indonesia

Dear Customers,

t is a great pleasure to introduce the first edition of RaboNews.

A special feature in this edition is an article about Banking for Food, Rabobank’s global vision and Rabobank Indonesia’s growth strategy to focus on the food and agribusiness sector in growing the Indonesian franchise.

In line with the Banking for Food strategy, Rabobank is here for a greater cause that extends beyond business. We want to contribute by addressing the world and Indonesia challenge to provide enough food sustainably for a growing population while arable land is decreasing. We intend to do this by providing access to finance, access to knowledge and access to Rabobank’s network.

As a bank that is focused on food and agribusiness, we would like to share knowledge in this sector through this publication together with information on our latest programs and services for your benefit such as Rabo Online Internet Banking and Rabo Golfer.

We hope that you enjoy our first edition of RaboNews.

Thank you for your patronage and continued support for Rabobank Indonesia.

Sincerely,

Martyn

Rabobank IndonesiaNoble House I, 30 floorJl. Dr. Ide Agung Gde Agung (Lingkar Mega Kuningan) Kav. E 4.2 No. 2 Jakarta 12950www.rabobank.co.idTel. 021-30021888Fax. 021-30021999

Editors:Gilang Soepangkat (Gilang.Soepangkat@rabobank.com)Taufik Hidayat (Taufik.Hidayat@rabobank.com)..

IThe aim of RaboNews is to provide you with the latest customer and business update on Rabobank Indonesia.

Contents

03» Banking for Food: Rabobank's Global Vision and Growth Strategy

05» 'Rabobank House': Rabobank Indonesia's New Head Office

06» What Job Does Your Healthy Foods Product Apply For?

07» Rabo Online Personal Internet Banking

08» Seafood: Traceability is Gaining Importance

08» Rabo Worldpass: Your Shopping Card!

09» Rabo Events

10» Rabo Golfer

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Banking for Food

In the year 2050, it is forecasted that the world’s population will increase from 7 billion today to 9 billion, of which 5 billion will be in Asia. Indonesia’s population is projected to grow from around 238 million today to about 360 million in 2050.

Therefore, Indonesia and the world will be challenged to provide enough food sustainably for a growing population on decreasing resources and arable land.

Rabobank, which started in 1898 as a farmer’s cooperative in the Netherlands has 118 years of experience in the food and agribusiness sector. Having knowledge and expertise in the sector, with its global Banking for Food vision, Rabobank would like to contribute to the world’s efforts in providing enough for a growing population by providing access to finance, access to knowledge, and access to Rabobank’s global network in 40 countries.

Rabobank's global vision and growth strategy

Rabobank Indonesia plans for accelerated growth and aspires to become Indonesia’s leading food and agribusiness bank. Banking for Food is Rabobank Indonesia’s strategy to focus on food and agribusiness in growing its franchise.

However, for Rabobank the food and agribusiness sector is not limited to food and farm products. “At Rabobank we can finance the entire food and agribusiness chain from farm to fork”, said Martyn H. Schouten, President Director/CEO of Rabobank Indonesia. "If we take the coffee supply chain as an example, it starts from farm inputs such as coffee seedlings, fertilizers, pesticides to the transportation companies carrying the coffee beans, processing plants, and retailers selling coffee that is ready for consumption".

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HIGHLIGHT

In line with the Banking for Food strategy to focus on the food and agribusiness sector, in 2015 Rabobank Indonesia restructured its branches and organization to focus on branches in areas with strong food and agribusiness potential. In the same year the bank started to implement the Banking for Food strategy. Implementation started from food and agribusiness training for all staff, to process improvement, commodities research and knowledge sharing to customers, prospective customers and the public.

Good results coming from Banking for Food Some of you may have attended the Indonesian Cocoa Market and Chocolate Products seminar in Makassar, the Asian Pacific Aquaculture 2016 conference in Surabaya, or the Prambanan Kencana bakery products seminar in Jakarta where Rabobank was the main speaker. This is in line with the Banking for Food strategy.

“We are experiencing stronger financial results reflective to this strategy”, said Hans Loth, Director of Strategy and Business Change. “We have a clear strategy and together with you our client we will contribute to provide enough food for a growing population sustainably".

Since January 2016, the bank’s profit after tax which consists of core results and extraordinary gains have grown significantly. Profit after tax grew from Rp. 10.75 billion in January to Rp. 171.60 billion in June 2016. Core results, which is the bank’s financial performance indicator starting 2017 also increased from Rp. 11.04 billion in January to Rp. 71.39 billion in June 2016.

Nett profit after tax (in billion Rupiah)

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Rabobank House

Rabobank Indonesia'sNew Head Office

R abobank Indonesia’s head office is now located at Noble House I, 30th floor Jl. Dr. Ide Agung Gde Agung (Lingkar Mega Kuningan)

Kav. E 4.2 No. 2 Jakarta 12950. Previously located at Plaza 89, Jl. HR Rasuna Said Kav. X-7 No. 6, Kuningan, Jakarta 10940. Rabobank now occupies the entire 30th floor of Noble House, a magnificent new building in the Mega Kuningan business district, and is known as 'Rabobank House'. Mr. Sander Pruijs, President Commissioner of Rabobank Indonesia, and Mr. Widiyarto Sumitro, the bank’s Commissioner inaugurated the office with clients and Rabobank staff on June 22, 2016.

Relocation to the new and more prominent office building is intended to promote a better banking experience for customers as well as to support its ‘Banking for Food’ strategy, to grow the bank and to become one of the leading food and agribusiness banks in Indonesia.

With a modern and functional design that immediately offers comfort and convenience, Rabobank House is equipped with modern meeting rooms that accommodate video conferencing calls with Rabobank offices worldwide and Rabobank Indonesia’s branch offices in Java, Sumatra, Kalimantan and Sulawesi.

We believe that these fully-equipped meeting rooms with conference facilities will help us upgrade business efficiency, as meetings can now be held remotely or by simply setting up a video conference call.

Rabobank House also displays a distinguished interior, with an array of pictures highlighting Indonesia’s top commodities; such as palm oil, cocoa, coffee, poultry, and cattle. The uniqueness of the bank’s interior design reflects the institution’s growth strategy ‘Banking for Food’.

We look forward to warmly welcoming you to Rabobank House.

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What Job Does Your Healthy Foods Product Apply For?As healthy lifestyles trend across the globe, many companies in Asia are also jumping onto the healthy foods bandwagon. However, many healthy foods brands in the region fall into the trap of “marketing myopia”: focusing too much on their product while lacking to connect with consumers.

Author: Rabobank FAR (Food & Agribusiness Research and Advisory) Analyst Haris Rahmanto was invited to present this topic at Health Ingredients Conference Southeast Asia, in Jakarta in April 2016

Many new products in packaged foods and beverages failed because of the lack of focus on consumer needs. In 2014, Nielsen, a global consumer research company with presence in

more than 100 country reported that of 12,000 new product launches in Western Europe, 76 percent failed within a year. In the United States, 85 percent of new products failed to make it to the second year.

Healthy food brands in Asia are not immune to this phenomenon. PepsiCo’s Aliva baked biscuits struggled in India and were eventually pulled off the shelves in 2013. Parle Hippo is another story of an unsuccessful healthy product in India. FitActive beverage in Indonesia promised “16 express nutrition”. The products are no where to be found on market shelves.

Some healthy foods and beverages initiatives in Indonesia such as multigrain chips, baked snacks, diet soda, and no sugar RTD tea only received lukewarm responses from the market. Although the failure rate varies across categories and regions, one of the main reasons for these products to fail is lack of relevance to consumers.

In developing healthy food products, many companies still use the product-focused approach. They strive to appeal to the consumer’s rational brain by putting various functional ingredients in the product and on the packaging, and then amplify the claims through advertising. However, neuroscience research proves otherwise. Antonio Damasio, professor of neuroscience at the University of Southern California, wrote in his book that when evaluating brands,

consumers primarily use their emotions (personal feelings and experiences) rather than relying on information (brand attributes, features, and facts). Features and facts only act as a rationalization for the purchase decision.

To be relevant to consumers, healthy food brands need to adopt a different approach in product development. Instead of looking at product features, they need to first understand the job of healthy products in the mind of the consumers. Consumers “hire” a product to do a specific job for them. The job of a functional beverage, for example, could vary depending on the consumption context: rehydrating, detoxifying, keeping awake, or even filling a hunger pang. By understanding the actual target the brand can then develop the best product features. As marketing guru Theodore Levitt used to say: “People don’t want to buy a quarter-inch drill. They want a quarter-inch hole!”

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Haris Rahmanto, FAR Analyst Rabobank Indonesia

Rabo Online Personal Internet Banking

Last year Rabobank launched Rabo Online Personal Internet Banking (now called 'Rabo Online Personal'). With the Rabo Online Personal service, you can do your banking transactions at your convenience, wherever you are, 24 hours a day, without having to travel directly to the bank or to an ATM.

You can save much time and avoid traffic congestion when you need to check your balance or transaction history, transfer funds to another account, or buy reload mobile phone vouchers.

Have you set up your access to Rabo Online Personal yet?Register now at the nearest branch of Rabobank Indonesia or online, through www.rabobank.co.id. As a sign of our appreciation, when you register, you stand the chance to receive a shopping voucher worth Rp50,000.

This does not apply for those who re-register.Please contact our 24-hour Rabo Access Center at 1500080 for further information.

How to register online:

1. Visit www.rabobank.co.id Rabobank Indonesia’s website, and click on the ‘Registration’ menu/link on the Rabo Online Personal Service Menu.

2. Enter your savings account /current account number and your email address or phone number as registered with Rabobank Indonesia.

3. Enter the Activation Code sent via email or SMS, and continue the process by entering a Username and registering a Password.

Don’t wait, register now!

Rp50,000 shopping voucher for the first 1000 customers who register. Valid from July 11 to December 31, 2016

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PRODUCT

Seafood: Traceability is Gaining ImportanceIn a steadily more connected world, transparency is becoming more imminent, with many people making it an objective.

Lian Heinhuis, an aquaculture analyst from Rabobank Food & Agribusiness Research and Advisory, has observed how consumers are quite concerned with recognizing the origin of a commodity, and demand a certain standard for its production. "In a more transparent world, consumers become more aware of the origin and the production process of a product. This increases the demand for traceability as well as putting pressure on processing companies to accept raw materials from small producers", said Heinhuis.

The good news is that Indonesia has been making significant progress with a growing number of fishery-based companies; gaining certification and moving from about 100 companies in 2009 to approximately 2,800 companies in 2013.

Seafood is the most traded animal protein around the world. Developing countries have generally been the producers, while developed countries are mostly the consumers.

Rabo WorldPass: Your Shopping Card!Did you know that your Rabo Worldpass card can be used for shopping?

The Rabo Worldpass is not only an ATM card. It is also a debit card accepted by more than 400,000 merchants in the Prima network. Therefore, you don’t need to bring cash to shop at supermarkets, purchase home- appliances, the latest smartphone, or dine at your favourite restaurant in this network. Just swipe your Rabo Worldpass for all the convenience!

As an ATM card, the Rabo Worldpass offers great value. Transactions at all ATM Bersama and Prima network ATMs are free of administration charges. The Rabo Worldpass can be used at any ATM and not only at Rabobank ATMs.

By value, Indonesia is one of the 10 biggest seafood exporting countries in the world, with export value of nearly US$ 3 billion in 2014.

Three other major seafood exporting countries are China, Norway and Thailand. Meanwhile, the European Union, the United States of America and Japan are three key seafood importing countries. The regions in Indonesia with the greatest seafood production are South Sulawesi (21.6%), East Nusa Tenggara (13.7%), Central Sulawesi (8.5%), and East Java (7.3%).

Rabobank strives to help the growing seafood production companies by sharing knowledge on the latest trends in the industry.

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Enjoy the flexibility and happy shopping!

FOCUS

In the Asian Pacific Aquaculture Conference 2016 (APA2016), Lian Heinhuis (Rabobank Food and Agribusiness Analyst, Aquaculture), presented a study on how consumers are becoming more demanding on the traceability of aquaculture products. APA2016 was held at Grand City, Surabaya, in April 2016.

Rabobank Indonesia Makassar Branch conducted a customer and media gathering in January 2016 to present Study on Indonesia’s Cocoa and Chocolate Products Market. The event was held at Hotel Clarion, Makassar. The event aims to share knowledge about cocoa, a leading commodity in South Sulawesi, to customers and the public.

Rabobank Indonesia was an exhibitor in the Indolivestock 2016 exposition held at JCC (Jakarta Convention Center) in July 2016. Indolivestock is one of Indonesia’s largest livestock expositions with around 500 exhibitors coming from the animal feed, livestock, and farm equipment industries.

RABOEVENTS

The Rabobank Indonesia sales team opened a booth at Kelapa Gading Mall, Jakarta, in June 2016 to promote the Rabo Worldpass card.The Rabobank Worldpass card is a great way to shop. It is accepted by around more than 400,000 merchants in the Prima network.

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Not only in Jakarta, but also in Surabaya and Makassar

In July 2016, Martyn H. Schouten (President Director/CEO Rabobank Indonesia) was one of the speakers at the South-East Asia and Pacific Regional Fisheries Summit hosted by The Economist, a leading global business publication. Martyn H. Schouten spoke about investments in the transition towards sustainable fisheries.

Big news for Golfers!

Rabobank presents its ‘Rabo Golfer’ program, offering a discount of up to 80% for golfers. This program is a joint promotional effort carried out between Rabobank Indonesia and Prestige Viva Golfer (PVG), the issuer of the prestigious ‘PVG First’ and ‘PVG Classic’ Cards.

Rabo Golfer: Up to 80% discount on green fee at 80 golf courses

Rabo Golfer not only gives a green fee discount. There are additional privileges received from this program, such as:

Golf tournament voucher (worth Rp400,000 for PVG First Card holders and Rp750,000 for PVG Classic Card holders).

Up to 20% discount for golf practice at 5 driving ranges.Up to 15% discount for coaching clinic at certain locations. Up to 20% discount for golf equipment purchases at PVG-M store or at merchants who are PVG partners.An invitation to join a Business Golf Gathering held three times a year. Loyalty Gift from Rabobank Indonesia.

PVG First PVG Classic

A Must-Have Product Gamma Savings Account Maestro Savings Account/ Regular Rupiah Current Account/Regular Wholesale Current Account

Requirements An average balance increase in Gamma Savings Account amounting to Rp.29 million per month.

An average balance increase in Maestro Savings Account/Regular Rupiah Current Account /Regular Wholesale Current Account amounting to Rp155 million per month.

Below are some key points about the Rabo Golfer program:

PVG is a golf club that has partnerships with almost all golf courses in Indonesia. PVG member privileges include discounts on green fee, coaching clinic, and purchase of golf equipment.

Get your PVG First Card now, by opening a Gamma Savings Account, or a PVG Classic Card or by opening a Maestro Savings Account/ Regular Rupiah Current Account/Regular Wholesale Current Account.

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