Economy and Banking Sector of the Netherlands

The Netherlands is a founding member of the European Union located in Northern Europe.

Economy of the Netherlands is very diversified with the main sectors ranging from a highly mechanised agricultural sector and fishing to metal and engineering products, electronic machinery and equipment, chemicals, petroleum, construction, and microelectronics. Due to the strategic geographic location of the Netherlands, other important parts of the economy are those gaining agvantages from the Netherlands' location: international trade, banking and transport.

The Netherlands has a favourable financial infrastructure with a long tradition in banking, retirement management, pension funds, investments and insurance products. In addition to the major Dutch banks such as ABN AMRO, ING, SNS Bank and Rabobank, the Netherlands houses branches of approximately 50 foreign banks.

Location Western Europe
Population (2016)16 979 120 ↑ (0.00%)
EU Status member since 1952
National Currency EUR (Euro) since 1 January 1999
    Nominal GDP (2015)678.6 bln EUR ↑ (+0.02%)
    Nominal GDP per Capita (2015)40 100 EUR ↑ (+0.02%)
    Real GDP Growth (2015)2.0 % ↑ (2014: 1.4 %)
Inflation Rate 
    CPI, MoM (Dec 2016)0.2 % ↑ (Nov 2016: -0.6 %)
    CPI, YoY (Dec 2016)0.7 % ↑ (Nov 2016: 0.4 %)
    CPI, Year Average (2016)0.1 % ↓ (2015: 0.2 %)
Unemployment Rate (2016)6.0 % ↓ (2015: 6.9 %)
Government Bond Yield (Dec 2016)0.44 % ↑ (Nov 2016: 0.39 %)
Credit Ratings (as of Sep 2016)
    FitchAAA highest credit quality, outlook stable
    Moody'sAaa prime, outlook stable
    S&PAAA prime
Withholding Tax 0.0 - 15.0%
Double Taxation Agreements 96 signed agreements
Information Exchange 
    Exchange on Request 29 signed agreements
    Automatic Exchange starts in September 2017
FATCA IGA in effect since 18 December 2013, Model 1
Banking Sector
Financial Market Development 4.5 (max 7.0) rank: 37th out of 138 countries
    Banks' Soundness 5.3 (max 7.0) rank: 51st out of 138 countries
Banking Industry Country Risk 2(1 - lowest risk, 10 - highest risk)
    Economy Risk 2
    Industry Risk 3
Deposit Guarantee Scheme 
    Maximum Protected Amount 100 000 EUR
Country Ceiling for Deposits 
    Local Currency (Euro)Aaa prime
    Foreign CurrencyAaa prime
Deposit Rates (Nov 2016, EUR)1.51 % ↓ (Oct 2016: 1.55 %)
Banking Sector Structure 
    Number of Banks100
    Recent Changes (2016) new banks: 4, closed banks: 111
    Consolidated Assets (2015) 2 527.69 bln EUR ↓ (-0.04%)
Major Banks
 Rabobank Nederland  SNS Bank NV
 List of Banks in Netherlands

the Netherlands' Economy

National Currency

Netherlands joined the Euro Area on 1 January 1999.



According to Eurostat, nominal GDP of Netherlands in 2015 was 678.6 bln EUR.

Netherlands underperforms the European Union in terms of real GDP growth with the average annual differential coming to -0.1% over the past 10 years (2005 - 2015). In 2015 real GDP growth was 2.0% which was above the Euro Area average (1.6%) and above the European Union average (1.9%). Real GDP growth in 2016 - 2021 are IMF's estimates.

Real GDP Growth in Netherlands.
Chart 1. Real GDP Growth in Netherlands. Source: Eurostat, International Monetary Fund.

In 2015, nominal GDP per capita in Netherlands was 40 100 EUR.

Netherlands has an above-average level of wealth in terms of per-capita GDP at purchasing power parity (PPP); this economic welfare indicator has, on average, exceeded that of the European Union by 26.9% over the past 10 years (2005 - 2015). GDP per capita at PPP in 2016 - 2021 are IMF's estimates.

GDP Per Capita at Purchasing Power Parity in  Netherlands; European Union = 100.
Chart 2. GDP Per Capita at Purchasing Power Parity in Netherlands; European Union = 100.

Inflation Rate

According to Eurostat, inflation rate in Netherlands in 2016 expressed as annual percentages of average consumer prices was 0.1% which was below the Euro Area average (0.2%) and below the European Union average (0.3%). Inflation rates in 2017 - 2021 are IMF's estimates.

Inflation Rate in Netherlands.
Chart 3. Inflation Rate in Netherlands. Source: Eurostat, International Monetary Fund.

Taxation in Netherlands

Withholding Tax

Withholding taxes are imposed at source of income and are often applied to dividends, interest, royalties, rent and similar payments. The rates of withholding tax are often reduced by double taxation agreements.

Withholding tax rates applied on payments of interest and dividends in Netherlands are shown in Table 1.

Dividends Interest
Natural person, resident 15.00.0
Natural person, non-resident 15.00.0
Table 1. Withholding tax rates in Netherlands.

Double Taxation Agreements

Double Taxation Agreement (DTA) is an agreement between two or more countries for the avoidance of double taxation.

Netherlands signed DTAs which already came info force with the following jurisdictions (for agreements which came into force after 01 January 2013 the date of coming into force is given in brackets):

 Bosnia and Herzegovina
 Czech Republic
 Hong Kong
 Korea, Republic of
 Moldova, Republic of
 New Zealand
 Russian Federation
 Saudi Arabia
 Sint Maarten (Dutch part)
 South Africa
 Sri Lanka
 United Arab Emirates
 United Kingdom
 United States

There are also several agreements between Netherlands and other jurisdictions which were signed but haven't yet come into force (for agreements signed after after 01 January 2013 of signing the agreement is given in brackets):

 China (May 2013)

Information Exchange

There are 3 ways for jusrisdictions to exchange information on tax matters:

  • spontaneously;
  • on request;
  • automatically.

Spontaneous exchange of information is provision of information that is forseeably relevant to another party without a request being previously sent.

Tax Information Exchange Agreements (TIEAs) enable exchange of information on request relating to a specific tax investigation, either criminal or civil.

Netherlands signed TIEAs which already came info force with the following jurisdictions (for agreements which came into force after 01 January 2013 the date of coming into force is given in brackets):

 Antigua and Barbuda
 British Virgin Islands (Jul 2013)
 Cayman Islands
 Cook Islands
 Costa Rica
 Isle of Man
 Marshall Islands
 Saint Kitts and Nevis
 Saint Lucia
 Saint Vincent and The Grenadines
 San Marino
 Turks and Caicos Islands

There are also several agreements between Netherlands and other jurisdictions which was signed but haven't yet come into force (for agreements signed after 01 January 2013 of signing the agreement is given in brackets):


Automatic information exchange allows jurisdictions to exchange information automatically, without having a specific tax investigation.

Netherlands signed the automatic information exchange agreement on 29 October 2014 and committed to start the automatic information exchange in September 2017.

Further Information:
Automatic Exchange of Information on Financial Accounts
Countries Which Will Not Automatically Exchange Account Information



Foreign Account Tax Compliance Act (FATCA) which became law in the United States in March 2010, focuses on reporting made by foreign financial institutions about financial accounts held by US taxpayers or foreign entities in which US taxpayers hold a substantial ownership interest. The FATCA-reporting is facilitated by Intergovernmental Agreements (IGAs).

Netherlands has FATCA agreement with the U.S. in effect since 18 December 2013 (Intergovernmental Agreement Model 1). Financial institutions operating in Netherlands are required to identify U.S. taxpayers by January 1, 2017 and to report the information for 2017 and the subsequent years. The agreement is reciprocal: the Netherlands' financial accounts hold in U.S. financial institutions will be reported to the Netherlands' authorities.

Further Information:
FATCA and European countries


the Netherlands' Banking Sector

Financial Market Development

According to World Economic Forum's Global Competitiveness Report 2016-2017, financial market development in Netherlands is scored 4.5 out of maximum 7.0 and ranked 37th out of 138 analysed economies. Soundness of banks is scored 5.3 bringing Netherlands into the 51st place, trustworthiness and confidence of financial market is scored 4.5 (48th place).

Financial Market Development in Netherlands.
Chart 4. Financial Market Development in Netherlands. Source: WEF.

Banking Industry Country Risk

Banking Industry Country Risk Assessment (BICRA) is a methodology designed by Standard&Poor's "to evaluate and compare global banking systems". A BICRA is scored on a scale from 1 to 10, ranging from the lowest-risk banking systems (group 1) to the highest-risk (group 10). The BICRA methodology has two main analytical components: "economic risk" and "industry risk". Each of the components is then further divided into 3 "factors" that result in an economic and industry risk score for each country.

Netherlands is included into group '2' with economic risk scored '2' and industry risk scored '3'.

BICRA Group 2
Economic risk 2
    Economic resilience very low
     Economic imbalances low
    Credit risk in economy intermediate
Industry risk 3
    Institutional framework intermediate
    Competitive dynamics intermediate
    Systemwide funding low
Government support assessment supportive

Table 2. BICRA for Netherlands. Source: S&P's.


Deposit Guarantee Scheme

Deposit Guarantee Schemes compensate certain deposits held by depositors of a bank that becomes unable to meet its obligations.

From a depositor's point of view it is important to know:

  • if the depositor is eligible within the terms of the deposit guarantee scheme;
  • if the depositor's bank is a participant in the deposit guarantee scheme;
  • if the depositor's type of deposit is covered by the deposit guarantee scheme.

All these details about deposit guarantee scheme in Netherlands are summarised in Table 3.

Scheme Participantsall credit institutions operating in Netherlands, branches of non-EEA banks, branches of the Netherlands' banks abroad
Scheme Exemptionsbranches of EEA-banks (covered by their home countries)
Eligible Depositorsprivate individuals, small companies
Covered Accountsnearly every payment or savings account, current account or term deposit is covered
Maximum Protected Amount100 000 EUR
Paid In CurrencyEUR

Table 3. Deposit guarantee scheme in Netherlands.

EEA stands for European Economic Area and consists of all EU member states plus Liechtenstein, Norway and Iceland.

Further Information:
Deposit Guarantee Schemes in Europe


Country Ceiling for Deposits

Moody's country ceilings for deposits specify the highest rating that can be assigned to local- or foreign- currency denominated deposit obligations of a bank or other deposit taking institution domiciled within that country.

Local currency (Euro) deposit ceiling for Netherlands is set to Aaa (prime), foreign currency deposit ceiling is Aaa (prime).


Deposit Rates

In Nov 2016, an agreed annualised deposit rate in local currency (Euro) of new contracts with agreed maturity up to 1 year between credit institutions and households was 1.51% which was above the Euro Area average (0.44%).

Deposit Rates in Netherlands.
Chart 5. Deposit Rates in Netherlands. Source: ECB.

Further Information:
Compare Bank Deposits in the Netherlands


Banking Sector Structure

Currently there are 100 credit institutions operating in Netherlands.

Recent structural changes (2013 - 2016) of the banking sector of Netherlands are summarised in Table 4.

Number of Opened Banks4774
Number of Closed Banks103817111

Table 4. Recent structural changes in the banking sector of Netherlands.

All the credit institutions operating in Netherlands can be classified into several categories. Table 5 summarises the number of banks in each category.

CategoryNumber of Banks
Branches of foreign banks49
Central banks1

Table 5. Number of banks by category in Netherlands.

The list of the most recently opened banks in Netherlands is provided in Table 6.

NameStart Date
 UBS Europe SE, Netherlands Branch (new)December 2016
 J.P. Morgan Europe Limited (new)October 2016
 Credit Suisse (Luxembourg) S.A., Netherlands Branch (new)May 2016
 Intesa Sanpaolo Bank Luxembourg Amsterdam Branch (new)April 2016
 Bank Degroof Petercam (new)December 2015
 Bank of America Merrill Lynch International Limited (new)October 2015
 Citibank Europe Plc (new)October 2015
 Credit Suisse International (new)October 2015
 Maple Bank GmbH (new)August 2015
 China Construction Bank (Europe) S.A. (new)April 2015

Table 6. The most recently opened banks in Netherlands.

There are 50 branches of foreign banks from 13 different countries in Netherlands. Table 7 shows 10 countries having the biggest number of branches in Netherlands.

Country of OriginNumber of Branches
 United Kingdom14
 United States1
 Korea, Republic of1

Table 7. Number of branches of foreign banks in Netherlands grouped by country of origin.


Share on Google+