Rabobank NZ posts annual profit increase, says outlook for the agriculture sector remains bright despite oil shock

Fresh from posting a strong rise in annual profit, rural lender Rabobank New Zealand says its growth strategy won't change despite war in the Middle East and the resultant oil shock hitting farm input costs.

Rabobank's 2025 calendar year net profit after tax rose $15.56 million, or 8%, to $210.85 million from $195.3 million in 2024.

Profit was bolstered by a $22.38 million release of loan impairments versus impairment losses of $46.95 the previous year. 

The bank's net interest income fell 8%, with total operating income down almost $37 million, or 7%, to $497.57 million. Operating expenses rose $12 million, or 5.5%, to $228.42 million.

Rabobank NZ CEO Todd Charteris says the combination of the much-improved returns for farmers last year, and the bank’s "prudent management of its accounts," contributed to the release of impairments.

Charteris says the income fall resulted from market interest rates declining, and the competitive agri-banking environment which reduced Rabobank NZ's net interest margin. Higher expenses were attributed to increased staff costs, plus technology and system upgrades.

As for 2026, Charteris says the bank’s growth strategy won't change.

"Notwithstanding the current concern over the war in the Middle East and the implications for farm input costs, the outlook for the sector remains bright and we’ll continue looking for opportunities to support rural New Zealand and to further expand our agri-lending portfolio,” he says.

Last year was an exceptional year for NZ’s food and agri-sector, Charteris says, with strong prices and export returns across all key agricultural sectors.

"Confidence among primary producers was remarkably strong across 2025, and it was fantastic to see our clients and the wider sector performing so well," says Charteris.

Rabobank NZ's gross lending rose almost $145.77 million, or 0.8%, to $17.352 billion across the year. Charteris highlights an increase in the bank's "inside the farm gate" portfolio, which he says rose $211 million to $13.96 billion "in an overall agricultural debt market which recorded only modest growth."

The bank's corporate, or post-farm gate, portfolio contracted slightly, he says, resulting in total net lending growth of $166 million.

Rabobank NZ's total deposits fell $114.178 million, or 1.5%, to $7.327 billion over the course of 2025.

Reserve Bank bank financial strength dashboard data shows Rabobank NZ as the country's second biggest agriculture lender, with total exposure of $13.7 billion behind only ANZ NZ's $14.9 billion. 

The dashboard shows Rabobank's December quarter return on equity at 6.4%, and its net interest margin at 1.9%. As of December 31, the bank had collective provisions of $24.3 million, and non-performing loans of $3.7 million.