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KBC Group

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KBC Group N.V.
Company typeNaamloze vennootschap
Euronext: KBC
LuxSE: KBC
IndustryFinancial services
Founded1985
HeadquartersBrussels, Belgium
Key people
Thomas Leysen (Chairman), Johan Thijs (CEO), Luc Popelier (CFO)
ProductsBanking and insurance
Revenue€8.378 billion (2010)[1]
€1.860 billion (2010)[1]
AUM€208.81 billion (end 2010)[1]
Total assets€320.82 billion (end 2010)[1]
Total equity€18.67 billion (end 2010)[1]
Number of employees
52,950 (FTE, end 2010)[1]
Websitewww.kbc.com

KBC Bank N.V. is a Belgian universal multi-channel bank, focusing on private clients and small and medium-sized enterprises. 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 European debt capital markets, domestic cash equity markets and in the field of corporate 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.

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 51,000 staff worldwide (of which 31,000 in Central and Eastern Europe and Russia) and serving 11 million customers worldwide (some 8 million in Central and Eastern Europe).

The group is controlled by a syndicate of core shareholders, but has a free float of some 41%. In the core shareholders, KBC Ancora controls 23%, MRBB (part of the Flemish farmers' association) controls around 13%, CERA (the largest cooperative in Wallonia) 7% and a group of industrialist families controls another 11%.[1] The free float was chiefly held by a large variety of international institutional investors (close to 45% UK-or US-based) as of the end of 2010. Its shares are traded on the Euronext exchange in Brussels and the Luxembourg Stock Exchange.

The group's overall aim is to be an independent, medium-sized provider of bancassurance for private clients and enterprises in selected European countries, with a focus on asset management and in financial markets.

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 New York, London, the Cayman Islands, and a subsidiary in Geneva, the Kredietbank (Suisse) S.A.. 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) [nl] (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 [nl].

Over the past decade, KBC has built up a strong presence in many of the countries that joined the EU on 1 May 2004 (Poland, Hungary, the Czech and Slovak Republics) by investing some 7.4 billion euros in acquisitions. More recently (2007), KBC has 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, now KBC Securities AD Beograd, Hipobroker, now KBC Broker, and Bastion, now 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 has sold or is planning to sell several subsidiaries, such as Centea, Fidea, Kredyt Bank, ADB, KBC Deutschland, and KBL epb (Krediet Bank Luxembourgeoise), its network of European private banking subsidiaries.

Structure and main subsidiaries

KBC Group NV is the direct parent company of:

  • KBC Bank NV
  • KBC Insurance NV
  • KBC Asset Management NV
  • Kredietbank SA Luxembourgeoise
  • ValueSource Technologies, Chennai, INDIA

All other KBC Group companies are direct or indirect subsidiaries of these.

Recent news

In September 2013, KBC agreed the sale of its German unit, KBC Deutschland, to several investors, including affiliates of Teacher Retirement System of Texas, Apollo Global Management, Apollo Commercial Real Estate Finance Inc and Grovepoint Capital.[4]

KBC Bank NV

KBC Bank is the main subsidiary. Its first home market is Belgium, where it is one of the top three banks, with a 20-25% market share and over three million customers (counting the customers of the subsidiaries in Belgium). Its second home market is Central Europe, served via subsidiaries and investments in the Czech Republic (ČSOB), Slovakia (ČSOB), Hungary (K&H Bank), Poland (Kredyt Bank) and Slovenia (Nova Ljubljanska Banka). With effect from July 2008, KBC Bank has acquired another small Slovak Bank, Istrobanka.[5] In all of these countries except Poland, KBC Bank is a top-4 player by market share. It also has a substantial presence in Ireland through its subsidiary KBC Bank Ireland (formerly IIB Bank), which is a major player in both the corporate and residential mortgage markets there. In all, KBC Bank has established a presence in some thirty countries around the globe. In 2007, KBC expanded its presence to Eastern Europe through the acquisition of DZI Insurance and CIBank in Bulgaria.

KBC Project Finance is a subsidiary of KBC Bank, and has been an active player in the non-recourse financing of projects since the early 1990s. Headquartered in Dublin, it also has professionals based in London, Brussels, New York, Hong Kong, and Sydney. Its main business lines are Energy and Infrastructure. This includes financing projects in sectors such as the oil & gas industry, power, renewable energy, and Public-Private Partnership. It has a portfolio in excess of US$5bn, financing approximately 250 projects worldwide.

KBC Bank also has investment banking operations in Europe, US and Asia. A specialist arm called KBC Financial Products operates primarily in global convertible bonds; its branch in Japan is called KBC Securities Japan, which specialises in secondary equity broking, convertible bonds, warrants, and equity derivatives.

Kredietbank SA Luxembourgeoise - European Private Bankers (KBL)

KBL European Private Bankers is no longer a subsidiary of KBC since a sale was agreed to Precision Capital for a reported €1.05 Billion.

See also

References

  1. ^ a b c d e f g "Annual Report 2010" (PDF). KBC Group. Retrieved 22 April 2011.
  2. ^ Edouard Mambu ma Khenzu. 2006. A Modern History of Monetary and Financial Systems of Congo, 1885-1995. (Lewiston: Edward Mellan).
  3. ^ "History of the German branch". Kbcbank.de. Retrieved 2013-04-11.
  4. ^ Philip Blenkinsop (24 September 2013). "KBC sells German unit to several investors". Reuters.
  5. ^ "Istrobanka bought by ČSOB owner - The Slovak Spectator". Spectator.sk. Retrieved 2013-04-11.
  • 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.
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