KBC Bank Ireland PLC, Preliminary Results for the year ended 31 December 2014

2/12/15

KBC Group reports net profit of €1,762 million and adjusted net profit of €1,629 million for full-year 2014.

  • KBC Group reports net profit of €1,762 million and adjusted net profit of €1,629 million for full-year 2014
  • KBC Bank Ireland reports loss for the year at €91 million (after tax and impairment costs) (FY 2013 €864 million)
  • Operating profit of €107 million before tax and impairment costs
  • Capital Position at year end: Tier 1 Capital Ratio 12.7%
  • Over 50,000 new customer accounts in 2014
  • Retail Deposits continue to grow to c.€3.4bn
  • €455 million in new mortgage lending with market share growing
  • Physical presence expanded to 10 retail banking hubs nationwide, five additional hubs planned for early 2015
  • KBC Bank Ireland remains on track to return to profit by 2016


KBC Group reported a net profit of €1,762 million for the full-year 2014 (2013: €1,015 million; Q4 2014 €457 million). Adjusted net profit amounted to €1,629 million for the full-year 2014 (excluding the impact of the legacy business (CDOs, divestments) and the valuation of own credit risk), compared with €960 million in 2013. Adjusted net profit for Q4 2014 was €477 million.

For full-year 2014 KBC Bank Ireland reports an operating profit of €107 million before tax and impairment costs and a loss of €91 million after tax and impairment costs (FY 2013 €864 million; €25 million for Q4 2014). KBC Bank Ireland reported loan impairment costs of €198 million for 2014 (including €41 million for Q4 2014).

KBC Bank Ireland opened over 50,000 new customer accounts in 2014. Retail deposit acquisition continued strongly, with total retail deposits now at €3.4 billion. KBC strengthened its mortgage offering further in 2014, with €455 million in new mortgage business, resulting in an increase in market share. KBC continued its retail expansion in 2014, with the opening of new retail banking hubs in Maynooth and Dublin - Swords, Grand Canal, Stillorgan and Dundrum. KBC will open five additional hubs in early 2015 in high-footfall locations such as Naas and Kilkenny. Moreover, KBC is providing better customer accessibility through Saturday opening across all hubs.

Strengthening its range of saving and investment products, KBC also launched the distribution of a suite of investment funds. The Bank initiated competitive personal loan and credit card products in 2014 and introduced preferential rates for current account customers on personal loans and savings. In line with its ethos of rewarding customers who have chosen KBC as their main bank, KBC today announced that it is further strengthening its offering by extending the 0.2% discount on variable mortgage rates and fixed rates to existing primary home owners who hold a primary Current Account with the Bank.

KBC won a number of awards in 2014, including the Best New Debit Card Programme of the Year (UK & Ireland Card & Payments Awards), Excellence in Mortgage Lending Award (PIBA Service Excellence Awards), Champion Agile Sales Team (Irish Sales Champion Awards), and Best Bank for Irish Savers Award (Irish Deposits / Sunday Times Awards).

KBC continues to make progress in relation to resolving arrears in its retail mortgage and corporate/SME loan books, proactively engaging with customers who are experiencing financial difficulty. The Bank has met quarterly targets set by the Central Bank for long-term mortgage arrears.

Commenting on the financial results, Wim Verbraeken, Chief Executive of KBC Bank Ireland said: “Our financial performance for the year was in line with forecasts and we remain on track to return to profit by 2016. This has been a year of continued growth for KBC, with the launch of new products and retail banking hubs. We are completing our transition to becoming a full-service retail bank and we now offer a full range of competitive products, leading rates and flexible services to suit how modern consumers want to bank. We continue to invest in our digital and online platforms to ensure the most efficient service.”

Discussing the latest product developments, Dara Deering, Executive Director and Head of Retail Banking, KBC Bank Ireland said: “Our latest mortgage offer, which rewards customers who have a strong relationship with KBC, adds to the many benefits a current account customer can avail of and complements existing offers on personal loans and savings which we launched last year. This new offer positions our mortgage rates for existing customers as extremely competitive and could be worth €503* on average per year on a typical mortgage for homeowners.”

KBC Bank Ireland remains on track to profitability by 2016. The Bank employs 988 people in Ireland with retail banking hubs in Dublin, Cork, Limerick, Kildare and Galway.

* Mortgage interest savings of an average of €503 per year are based on a €250,000 mortgage over a 20 year period based on a rate of 4.3% (reduced from the current variable rate of 4.5%).