KBC Bank Ireland PLC, Preliminary Results for the year ended 31 December 2013


KBC Bank Ireland PLC, Preliminary Results for the year ended 31 December 2013.

  • KBC Group reports net profit of €1,015 million and adjusted net profit of €960 million for full-year 2013
  • KBC Bank Ireland reports loss for the year at €864 million (after tax and impairment costs) (FY 2012 €306 million)
    • Loan impairment costs of €1,059 million (FY2012: €547 million), in line with projection issued in Novemmber 2013
    • Capital Position at year end: Tier 1 Capital Ratio 12.23%
  • Retail Deposit Growth to c.€2.9bn, with 34,000 new customers overall
  • Projected increase of 200 employees for 2014
  • KBC Bank Ireland on track to return to profit by 2016

KBC Group reported a net profit of €1,015million for full-year 2013 (2012: €612million). Adjusted net profit amounted to €960 million for full-year 2013 (excluding the impact of the legacy business (CDOs, divestments) and the valuation of own credit risk, compared with €1,496 million in 2012). 

KBC Bank Ireland reports an operating profit of €159 million before tax and impairment costs and a loss of €864 million after tax and impairment costs for 2013 (FY 2012 €306 million).   

KBC Bank Ireland reported loan impairment costs of €1,059 million for 2013. Following a reassessment of its loan book, the Bank took a conservative approach to impairments by providing for an extra c.€671m in Q4 of 2013. For 2014, the Bank currently expects loan loss provisions in the range of €150m-€200m with the range reducing back to between €50m-€100m for the subsequent years 2015 and 2016.  A return to profitability is forecast for 2016.

KBC Bank Ireland continued its retail expansion in 2013, both online and in key locations around the country, increasing retail deposits to c.€2.9bn and attracting an additional 34,000 new customers. The Bank introduced mobile banking and launched a new competitive current account proposition for retail consumers with full online and mobile banking capability as well as a new suite of insurance products and opened new walk-in banking hubs in Cork, Limerick and Galway.

Commenting on the financial results, Wim Verbraeken, Chief Executive of KBC Bank Ireland said: “Financial results are in line with the projection issued in November 2013 including a significant effort to evolve the credit grading and the provisioning levels for impaired loans. This is in light of an assessment of assumptions related to the macro-economic environment, customer behaviour and changes in regulatory guidelines. As a result, KBC Bank Ireland is on track to return to profit by 2016. With the strength and support of KBC Group, we continue to successfully implement our retail banking strategy and expand our presence in Ireland. We have grown our employee base by 150 people in the last twelve months and expect to increase the number of employees by 200 in 2014.  The combination of our investment in online and mobile platforms and our retail hubs allows us to be fast-moving and responsive to customers’ modern banking needs working off a highly efficient cost base. Customers are benefiting from the distinctive, responsive service we can provide combined with compelling value and competitive products.”