“Last year, as I am sure you remember, I promised that there would be higher rates, shorter loan tenors and lower advance rates for purchases and receivables. This is due to the fact that we have to think and act according to economic reality and more importantly to act in the new reality of banking.

 

It’s also important to show other banks that this is an interesting sector to allocate assets with the right risk returns. Thus far, regarding the latter I have not seen much investment coming to the sector apart from the recent interest from China. It also demonstrates that risk/return aspects in our sector are still not balanced enough. So as an industry, we need to give a stronger response. Of course we don’t need more money in the business, but we need more banks willing to participate in our industry to stay sustainable.

 

So what about 2014? From what I understand and hear, the year has started well, however I want to caution against too much optimism, the year is still very young.

 

Many things are evolving still, within sourcing, trading and manufacturing, and financing. And let’s not forget the consumer either. How sure are we that they will keep buying diamond jewelry? We also need to ask ourselves how sustainable is this light recovery within the industry, or perhaps a better question would be to ask how sustainable are we as an industry and what does sustainability really mean for us anyway?

 

Sustainability has many meanings and it all depends on what interpretation you have. For me, sustainability is basically the right to exist and to remain, both now and also in the future. This also applies as a business whether you are a bank, trader, diamantaire or jeweler. In our industry, we are equal partners and we must be united to achieve our common goals, goals to remain, or perhaps better said, our goal to become more sustainable. However, this shared goal both concerns me and gives me an insight  on the opportunities as well.

 

Are we really united? That is, do we understand what we want to achieve as a sector, do you understand what the banks want or need, and do we explain that to you enough? It is both banks and also yourselves as industry stakeholders that will shape this sector in order to cope with the impact of the new reality in the economy and also within the financial sector at large.

 

We will not hide behind this, nor use that as an excuse, but those who still don’t understand this new reality will never understand and thus better reconsider working in this sector or find a new banking partner. We can better allocate those assets  to other clients or prospects. Clients or prospects who do understand the new reality and have the willingness to look forward and who share the same definition of sustainability that I mentioned before.

 

We have the choice as a sector to either stay in a non-transparent niche business hidden away from modern financial markets – and yes I am deliberately exaggerating – or to develop ourselves into a modern sector with a modern approach, standards and practices. This is the choice that the sector has to make and that includes all of us and not simply the banks. Having said that, you can expect from us that we will take a lead in these discussions. We do this because we believe in a sustainable and transparent diamond business. We do this because we care.

 

Because we care, we will bring up these topics in order to work on sustainable business models so we create a common understanding for all of us in terms of what this means for us, and what it requires from all of us in the chain from miner and diamond producers to retailer, insurer to bank and bank to insurer.

 

Because of our focus on sustainability, we speak a lot with industry bodies such as the AWDC, DMCC, WDC, WDFB, CIBJO, RJC, the World Diamond Mark of the WFDB, and so on. We try to unite them to create common efforts and goals, and as a sector, we surely need to respond to the further development of the Kimberly Process – it is a process after all.

 

We also speak frequently with business partners, such as IDEX, Rapaport, Tacy, I. Hennig, Bonas, AIG, etc, and I realize I am forgetting a lot of other names here. We do this to create a new sustainable and modern future.

 

A big theme for us in 2014 is sustainability and being a modern business. However, firstly let’s have both feet on the ground. We will see in 2014 the same sort of trends as in 2013: capital for the diamond business will still be scarce and expensive. So to stay sustainable, issues on reporting, valuations, transparency, profitability, must remain key factors for our industry. We need to take this long-term view together and invest together – there is no free ride.

 

As a client you have your fiduciary responsibility with regard to your family and business and we also have a fiduciary responsibility with our business and our provider of capital, our clients with savings too. So that means, also, that apart from tightened terms and conditions, we will also look more intensely at corporate structures and the logic behind them, stock value, money and goods, flows and taxes.

 

We will also look more intensely at discipline in timely transparent reporting, the willingness of clients to comply and look at, and request, independent business reviews and audits. We do expect to see a willingness to comply with standards which are logical; that means logical to stay sustainable and logical to be modern business partners. That also includes fair disclosures of treated or man-made diamonds. We will continue to be rigorous, harsh and relentless when we are confronted with fraud in any form and this should be clear as well: no exceptions and zero tolerance.

 

Last week, our Chairman, Gerrit Zalm, visited Antwerp and met some of our clients and had a good dialogue with the media, too. He understands our business and has a great customer focus, he recognizes the importance of the sector for Belgium and for Antwerp as well. He stimulates people to think in a modern way about the business. As you know there is a turnaround from basically blank credit to asset-based, secured lending to become a common commercial and corporate sector. This comes at a price, of course, but we definitely need to get rid of the sometimes bad stigma others give to the industry. Let’s not fool ourselves, the stigma is there if you remember the media coverage and also recently the understandable attention from regulators.

 

We need to become sustainable, keeping the right to exist, not just as a specialty niche that the financial sector seems to ignore. We at ABN AMRO are here to have this discussion with you – what it means and what it takes to stay sustainable and remain sustainable as proud partners in business for the long-term.

 

In order to cope with all these challenges, Mark van Rijt and Sabine Smets here in Antwerp have made some changes to the Belgian Commercial division as well. These changes to the teams will create a seamless service that will result in better accessibility and faster service to you our valued customers.

 

I thank our team for all their efforts last year and for their endurance this year and for that I would like to give them a big thank you. But an even bigger thanks to our business partners and to you, our clients. After all, no clients means no bank.

 

I would like to finish by sharing with you our mission statement: “We aim to be a leading and proud partner to the diamond and jewelry business, enabling as one global team to elevate the business to a sustainable long term future.”