KBC Bank

KBC Group N.V.

Type	Naamloze vennootschap
Traded as	Euronext: KBC LuxSE: KBC
Industry	Financial services
Founded	1935 (1935) (Kredietbank), present name (KBC Group) dates from 2005
Headquarters	Brussels, Belgium
Key people	Thomas Leysen (Chairman), Johan Thijs (CEO), Rik Scheerlinck (CFO)
Products	Banking, insurance, asset management
Revenue	€7.700 million (2017)[1]
Net income	€2.575 million (2016)[1]
AUM	€219 billion (2016)[1]
Total assets	€292.3 billion (end 2016)[1]
Total equity	€18.8 billion (end 2016)[1]
Number of employees	38,356 (FTE, end 2016)[1]
Website	www.kbc.com

KBC Group N.V. is a Belgian universal multi-channel bank-insurer, focusing on private clients and small and medium-sized enterprises in Belgium, Ireland and Central Europe. Besides retail banking, insurance and asset management activities (in collaboration with sister companies KBC Insurance NV and KBC Asset Management NV), KBC is active in, among other things, European debt capital markets, domestic cash equity markets and in the field of corporate banking, private banking, leasing, factoring, reinsurance, private equity and project and trade finance in Belgium, Central and Eastern Europe and elsewhere (mainly in Europe). KBC is an acronym for Kredietbank ABB Insurance CERA Bank(CEntrale RAiffeisenkas,).

The parent company, KBC Group N.V., is one of the major companies and the second largest bancassurer in Belgium. It is the 18th largest bank in Europe by market capitalisation and a major financial player in Central and Eastern Europe, employing some 42,000 staff worldwide (of which more than half in Central and Eastern Europe) and serves 11 million customers worldwide (some 7 to 8 million in Central and Eastern Europe).

The group is controlled by a syndicate of core shareholders, and has a free float of approximately 60%. In the core shareholders, KBC Ancora controls 19%, MRBB (part of the Flemish farmers' association) controls around 11%, CERA (the largest cooperative in Wallonia) 3% and a group of industrialist families controls another 7%.^[1] The free float was chiefly held by a large variety of international institutional investors as of mid 2018. Its shares are traded on the Euronext exchange in Brussels.

The group's overall ambition is to be the reference in bank-insurance in all its core markets.

The private art collection of KBC bank is situated in the Rockox House in Antwerp.

History

The Catholic Volksbank van Leuven, founded in 1889, was one of the earliest predecessors of the KBC Bank. Another predecessor was the Bremer Vorschussverein, founded in 1889 and changed later into Bankverein Bremen AG. In 1935, the banks Algemeene Bankvereeniging and Volksbank van Leuven merged with the Bank voor Handel en Nijverheid to create the Kredietbank. The Kredietbank would be the only Belgian financial institution under Flemish control which would survive the financial crisis of the great depression of the 1930s. Fernand Collin, who became president in 1938, conceived the business strategy which would lead to the growth of the bank. He defined the Kredietbank as an independent bank with a decidedly Flemish character which would be an instrument to further Flemish economic growth.

During World War II, the bank would be able to expand its activities and grow its deposits from the Flemish middle class. After the war, because of the economic recovery, the Kredietbank, now the third largest bank in Belgium, was able to increase the number of operating branches in Flanders. The postwar growth strategy of the bank, emphasized foreign expansion and the development of portfolio-management services for investors. The bank expanded into Luxembourg in 1949 with the Kredietbank S.A. Luxembourgeoise and into Wallonia with the establishment of the Crédit Général de Belgique in 1961.

The Kredietbank also expanded into Belgian Congo. It established a branch in Léopoldville in 1952. Then in 1954 it acquired Banque Congolaise pour l’Industrie, le Commerce, et l’Agriculture and renamed it Kredietbank-Congo,^[2] Ultimately it had four branches, one each in Léopoldville, Bukavu, Elizabethville and Stanleyville. Due the situation emerging after the independence of Belgian Congo in 1960, the bank discontinued its Congolese operations in 1966.

In the sixties, driven by increasing competition, the bank worked on the expansion of its branch network and improvement of consumer services. In 1966, the bank began building a foreign-correspondent network and the establishment of foreign branches in a number of countries. In 1970, together with six other European institutions, Kredietbank established the Inter-Alpha Group of Banks. The Kredietbank N.V. Bruxelles acquired the main part of the shares from the Bankverein Bremen AG since 1982. The branch in Bremen was renamed to Kredietbank-Bankverein AG in 1990.^[3]

In 1998, the Kredietbank merged with two financial institutions originating from the Boerenbond (Vlaanderen) (E: Belgian Catholic Farmers Association), ABB-insurance (Assurances du Boerenbond Belge) and CERA (Centrale Raiffeisenkas) Bank, to form the 'KBC Bank and Insurance Holding Company'. Since then, the group has significantly expanded its activities, chiefly in Central and Eastern Europe. In 2005, KBC set another milestone by merging with its parent company, Almanij, and changing its name to KBC Groep NV.

Over the past 2 decades, KBC built up a strong presence in many of the countries that joined the EU on 1 May 2004. More recently (2007), KBC made acquisitions in Bulgaria (DZI Insurance, DZI Invest and EIBANK), Romania (KBC Securities Romania, Romstal Leasing and INK Insurance Broker), Russia (Absolut Bank), Serbia (KBC Banka and Senzal, which became KBC Securities AD Beograd, Hipobroker, which became KBC Broker, and Bastion, which became KBC Securities Corporate Finance) and Slovakia (Istrobanka).

After receiving government support during the financial crisis, the bank embarked on a divestment programme to satisfy the requirements of the European Commission. As such, it sold several subsidiaries, including Centea, Fidea, Kredyt Bank, ADB, KBC Deutschland, Absolut Bank and KBL epb (Krediet Bank Luxembourgeoise), its network of European private banking subsidiaries. The divestment programme was completed in 2014 and the state aid entirely paid back by 2015, five years ahead of the agreed schedule.

The group now focusses on its six core countries: Belgium, The Czech Republic, Slovakia, Hungary, Bulgaria and Ireland.

Investment in coal

KBC has been criticised for its investment policies regarding fossil fuels. According to a 2015 report by Belgian NGO Fairfin KBC invested^[4] 2.4 billion dollars between 2004 and 2014 through loans and emitting shares and obligations. In contrast the money allocated to renewable energy was only 929 million dollars.

When KBC reviewed its sustainability policy in 2016,^[5] the Global Network of Non-governmental organization cooperating in the field of private banks and sustainability, Banktrack published an analysis acknowledging progress made on fossil fuels, while criticising the exception for the Czech Republic where the bank continues to finance coal,^[6] saying “the new general restriction on coal is welcome and positive, however the exception applied to Czech coal companies is concerning."

In 2017 the Belgian Climate Coalition published a report^[7] charting the investments in fossil fuel of the four major banks in Belgium (KBC, ING, BNP Paribas and Belfius). In this report they attacked the exception for the Czech Republic as well,saying “the exceptions for coal activities in the Czech Republic don’t comply with the strict deadlines imposed by climate science.”

Structure and main subsidiaries

KBC Group NV is the direct parent company of:

• KBC Bank NV
• KBC Insurance NV

All other KBC Group companies are direct or indirect subsidiaries of these. The main ones are shown in the table:

BEL = Belgium Business Unit, CZR = Czech Republic Business Unit, IMA = International Markets Business Unit, GRP = Group Centre.

Recent news

In December 2016, KBC announced that it would acquire Bulgarian Bank, making KBC the largest bank-insurance group in the country. In February 2017, Ireland was defined as a new core market of KBC Group.

See also

• Paul Borghgraef
• Fernand Collin
• Luc Debaillie
• Frank Donck
• Jozef Van Waeyenberge
• Remi Vermeiren, former president
• Philippe Vlerick

References

• Van der Wee, Herman and Van der Wee-Verbreyt, Monique, People Make History: The Kredietbank and the Economic Rise of Flanders, 1935-1985, Brussels, Kredietbank, 1985.

External links

Wikimedia Commons has media related to KBC.

• Official website