Kbc Group N.v. · EURONEXT:KBC

Kbc — Debt Investor Presentation (August 2021)

79 slides from Kbc's debt investor presentation, August 2021

  1. Slide 1: KBC Group / Bank Debt presentation August 2021

    KBC Group / Bank Debt presentation August 2021 More infomation: www.kbc.com KBC Group - Investor Relations Office – E-mail: IR4U@kbc.be 1

  2. Slide 2: Important information for investors

    Important information for investors  This presentation is provided for information purposes only. It does not constitute an offer to sell or the solicitation to buy any security issued by the KBC Group.  KBC believes that this presentation is reliable, although some information is condensed and th

  3. Slide 3: KBC Passport: Well-defined core markets

    KBC Passport Well-defined core markets Market share (end 2020) BE CZ SK HU BG IRL 19% 21% 12% 11% 10% 8% * Loans and deposits 3.7m clients 4.2m clients 454 branches 28% 232 branches 23% 18% 106bn EUR loans 31bn EUR loans 12% 13% 160bn EUR dep. Investment funds 45bn EUR dep. IRELAND 28% 0.8m clients

  4. Slide 4: Group's legal structure and issuer of debt instruments

    KBC Passport Group’s legal structure and issuer of debt instruments KBC Group NV Clean(Clean HoldcoHoldco ultimately by 1/1/2024* by 1/1/2024)  AT 1  Tier 2 MREL  Senior 100% 100% 100% KBC Bank KBC Insurance KBC Global Services N.V.*  Covered bond  No public issuance KBC IFIMA**  Retail and Wh

  5. Slide 5: Contents

    Contents 1. Strategy and business profile SHAREHOLDER STRUCTURE AT END 1H21 Other core MRBB 2. Financial performance 7.3% Cera 11.5% 2.7% 3. Solvency, liquidity and funding 4. Covid-19 KBC Ancora 18.6% 5. Covered bond programme 59.9% Free float 6. Green bond framework 7. Looking forward  Roughly 40

  6. Slide 6: KBC Group in a nutshell (1)

    KBC Group in a nutshell (1)  We want to be among Europe’s best performing financial institutions! By achieving this, KBC wants to become the reference in bank-insurance in its core markets • We are a leading European financial group with a focus on providing bank-insurance products and services to

  7. Slide 7: KBC Group in a nutshell (2)

    KBC Group in a nutshell (2)  High profitability  Solid capital position... Fully loaded Basel 3 CET1 ratio of KBC Group (Danish Compromise) C/I ratio* Combined ratio Net result 16.6% * 16.6% * 17.6% 17.6% * 17.5%* 16.3%* 1440m 11.38% Maximum Distributable Amount 57% 85% EUR 1350m 54% 82% EUR 8.00%

  8. Slide 8: Differently: the next level

    Differently: the next level KBC is the reference: The winning factors Trust Personalised solutions Capitalising on the trust customers Using data and AI to offer proactively place in us today compelling, relevant and personalised financial solutions Customer experience Broad offer Providing zero-has

  9. Slide 9: Kate, your digital assistant

    , your digital assistant Hyper personalised and trusted financial digital assistant RELEVANT & VALUABLE OFFER Kate will only propose offers where sufficient added value is shown or when she can serve the client in an important moment in the client's PERSONALISED & DATA DRIVEN live The interaction be

  10. Slide 10: Differently: the next level

    Differently: the next level The strong basis remains + + 10

  11. Slide 11: Differently: the next level

    Differently: the next level Bank-insurance+ 11

  12. Slide 12: Introducing 4 new operational targets (1)

    Differently: the next level Translating strategy into non-financial targets Introducing 4 new operational targets (1) Customer NPS ranking % bank-insurance (BI) clients Top-2 Top-2 78% 85% 22% 27% 2020* target '23 2020 BI target '23 2020 stable BI target '23  Target is to remain the reference (top-

  13. Slide 13: Introducing 4 new operational targets (2)

    Differently: the next level Translating strategy into non-financial targets Introducing 4 new operational targets (2) % digital sales STP score* (bank / insurance) (straight through processing) 40% 32% 80% 25% 60% 15% 25% 41% 2020 target '23 2020 target '23 2020 target '23 2020 target '23 bank insur

  14. Slide 14: Our sustainability strategy

    Our sustainability strategy The cornerstones of our sustainability strategy and our commitment to the United Nations Sustainable Development Goals We apply strict sustainability rules to our business activities adverse impact Limiting our in respect of human rights, the environment, business ethics

  15. Slide 15: Our sustainability governance

    Our sustainability governance Sustainability embedded in our organization  Top level responsibility for sustainability and climate strategy • The Executive committee has the highest level of direct responsibility for sustainability and climate change and reports on it to the Board of Directors • Di

  16. Slide 16: Our sustainability ambitions

    Our sustainability ambitions We substantially raise the bar for our climate-related ambitions Renewable energy loans Direct coal-related finance Volume of SRI Funds (In millions of EUR) (In billions of EUR) (In % of total energy-sector loan portfolio) 252 30 61% 60% 65% 57% 21 44% 17 12 86 9 Full Fu

  17. Slide 17: Sustainable finance

    Sustainable finance Our commitment to contribute to a sustainable society Sustainable finance (*) 2019 2020 Green products and business solutions : (KBC Group, in millions of euros)  Business solutions to promote energy efficiency in buildings, industrial processes Green finance and mobility, e.g.:

  18. Slide 18: Our sustainability strategy: double materiality

    Our sustainability strategy Our commitment to the climate, following the ‘double materiality’ approach FINANCIAL MATERIALITY* ENVIRONMENTAL & SOCIAL MATERIALITY Committed to manage the impact of climate change on our Committed to manage the direct and indirect impact of our company company on climat

  19. Slide 19: Contents

    Contents 1. Strategy and business profile BREAKDOWN OF ALLOCATED CAPITAL 2. Financial performance BY BUSINESS UNIT AS AT 30 June 2021 3. Solvency, liquidity and funding 4. Covid-19 Czech Republic 15% 5. Covered bond programme Belgium 62% 6. Green bond framework 22% 7. Looking forward International M

  20. Slide 20: 2Q 2021 key takeaways

    2Q 2021 key takeaways 2Q21 financial performance 1H21  Commercial bank-insurance franchises in core markets performed very well  ROE 15%*  Cost-income ratio excluding bank taxes  Customer loans and customer deposits increased 49% y-o-y in most of our core countries  Combined ratio 82%  We full

  21. Slide 21: Net result at KBC Group

    Net result at KBC Group CONTRIBUTION OF BANKING ACTIVITIES TO KBC GROUP NET RESULT* 639 546 437 412 NET RESULT AT KBC GROUP* 42 793 697 -11 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 538 557 210 CONTRIBUTION OF INSURANCE ACTIVITIES TO KBC GROUP NET RESULT* -5 173 157 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 153 147 133 119

  22. Slide 22: Higher net interest income and net interest margin

    Higher net interest income and net interest margin NII Amounts in m EUR  Net interest income (1,094m EUR) 1,195 • NII increased by 2% q-o-q, driven primarily by: 1,083 1,122 1,067 1,068 1,094 111 17 6 15 15 o organic loan volume growth 106 131 105 1 14 98 16 102 1 1 o intensified charging of negati

  23. Slide 23: Higher net fee and commission income

    Higher net fee and commission income F&C* Amounts in m EUR  Net fee and commission income (450m EUR) • Up by 2% q-o-q and by 16% y-o-y 441 450 429 388 390 403 • Q-o-q increase was the result of the following: 229 234 o Net F&C income from Asset Management Services increased by 225 214 213 223 2% q-

  24. Slide 24: Insurance premium income up y-o-y and excellent combined ratio

    Insurance premium income up y-o-y and excellent combined ratio PREMIUM INCOME (GROSS EARNED PREMIUMS)  Insurance premium income (gross earned 832 premiums) at 735m EUR 740 712 715 745 735 • Non-life premium income (463m EUR) increased by 297 267 382 292 272 6% y-o-y in 2Q21 276 • Life premium incom

  25. Slide 25: Non-life sales up y-o-y, life sales up q-o-q and down y-o-y

    Non-life sales up y-o-y, life sales up q-o-q and down y-o-y NON-LIFE SALES (GROSS WRITTEN PREMIUM)  Sales of non-life insurance products 567 590 • Up by 7% y-o-y due to growth in all classes 415 416 446 405 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21  Sales of life insurance products • Increased by 5% q-o-q and

  26. Slide 26: Lower FIFV and net other income

    Lower FIFV and net other income 253 FIFV  The q-o-q decrease in net gains from financial 126 instruments at fair value was attributable mainly 85 80 127 to: 75 29 42 100 19 45 25 44 • a negative change in ALM derivatives 55 12 24 -3 31 -2 13 -30 23 -7 35 • lower dealing room income -58 -52 • a lowe

  27. Slide 27: Good cost management, lower bank taxes

    Good cost management, lower bank taxes  Operating expenses excluding bank taxes in 1H21 rose OPERATING EXPENSES by 0.7% y-o-y like-for-like. The C/I ratio excluding bank 1,338 1,320 taxes amounted to 49% in 1H21 407 988 424 972  Our FY21 guidance for opex excluding bank taxes 926 904 27 21 49 30 r

  28. Slide 28: Higher net impairment releases and excellent credit cost ratio

    Higher net impairment releases and excellent credit cost ratio 857 ASSET IMPAIRMENT 12  Net impairment releases 141 746 • Loan loss impairment releases of 130m EUR in 2Q21 (compared 122 43 20 63 with 76m EUR in 1Q21), due almost entirely to a 129m EUR 66 78 99 11 reversal of collective Covid-19 ECL

  29. Slide 29: Loan loss experience at KBC

    Loan loss experience at KBC 1H21 FY20 FY19 FY18 FY17 AVERAGE CREDIT COST CREDIT COST CREDIT COST CREDIT COST CREDIT COST ‘99 –’20 RATIO RATIO RATIO RATIO RATIO Belgium -0.20% 0.57% 0.22% 0.09% 0.09% n/a Czech Republic -0.41% 0.67% 0.04% 0.03% 0.02% n/a International -0.18% 0.78% -0.07% -0.46% -0.74%

  30. Slide 30: Impaired loans ratios, of which over 90 days past due

    Impaired loans ratios, of which over 90 days past due KBC GROUP BELGIUM BU 3.4% 2.4% 2.4% 2.4% 3.3% 3.3% 3.3% 2.2% 2.3% 3.2% 3.2% 2.2% 1.9% 1.9% 1.8% 1.8% 1.8% 1.7% 1.1% 1.2% 1.2% 1.2% 1.1% 1.0% 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 Impaired loans ratio Of which over 90 days pa

  31. Slide 31: Cover ratios

    Cover ratios KBC GROUP BELGIUM BU 62.4% 61.7% 63.5% 63.0% 64.1% 68.3% 67.4% 68.8% 60.4% 65.9% 65.4% 62.6% 43.4% 44.8% 45.2% 44.7% 42.9% 46.4% 42.7% 44.9% 45.4% 45.6% 41.3% 38.6% 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 Impaired loans cover ratio Cover ratio for loans with over 90

  32. Slide 32: Overview of contribution of business units to 1H21 result

    Overview of contribution of business units to 1H21 result Amounts in m EUR NET PROFIT – KBC GROUP 1H21 ROAC: 23% 2,575 2,570 2,489 1,090 1,322 1,314 1,440 1,350 1,485 1,235 1,248 1,175 205 2017 2018 2019 2020 2021 2H 1H NET PROFIT – BELGIUM NET PROFIT – CZECH REPUBLIC NET PROFIT – INTERNATIONAL MARK

  33. Slide 33: Balance sheet

    Balance sheet KBC Group consolidated at the end of June 2021 Total assets Total liabilities and equity (EUR 369bn) (EUR 369bn) 164 Credit quality 201 Capital adequacy & liquidity position 67 23 4 14 42 19 5 13 119 65 Loan book (loans and advances to customers) Deposits from customers Investment port

  34. Slide 34: Loans and deposits continue to grow in most countries

    Balance sheet Loans and deposits continue to grow in most countries 17% 12% 9% 6% BE 5% 2% Y-O-Y ORGANIC* VOLUME GROWTH Loans** Retail Deposits*** Loans** Retail Deposits*** mortgages mortgages 28% 14% 13% 11% 6% 7% 8% 2% CR 3% 4% Loans** Retail Deposits*** Loans**** Retail Deposits*** mortgages mor

  35. Slide 35: Contents

    Contents 1. Strategy and business profile 2. Financial performance 3. Solvency, liquidity and funding 4. Covid-19 5. Covered bond programme 6. Green bond framework 7. Looking forward Appendices 35

  36. Slide 36: Strong capital position (1)

    Strong capital position (1) Fully loaded Basel 3 CET1 ratio at KBC Group (Danish Compromise)  The fully loaded common equity ratio amounted to 17.5% at the end of 1H21 based * * on the Danish Compromise 17.6% 17.6% 17.5% * * 16.3% * * 16.6% 16.6%  KBC’s CET1 ratio of 17.5% at the end of 1H21 repre

  37. Slide 37: Strong capital position (2)

    Strong capital position (2) Fully loaded Basel 3 total capital ratio (Danish Compromise) 21.2% 21.2% * * 19.7% * 19.8% * * 19.8% * 2.1% T2 20.1% 2.1% T2 1.8% T2 1.2% T2** 1.9% T2 1.8% T2 1.5% AT1 1.5% AT1 1.4% AT1 1.5% AT1 1.5% AT1 1.5% AT1  The fully loaded total capital ratio amounted to 20.1% at

  38. Slide 38: Fully loaded Basel 3 leverage ratio and Solvency II ratio

    Fully loaded Basel 3 leverage ratio and Solvency II ratio Fully loaded Basel 3 leverage ratio at KBC Group Fully loaded Basel 3 leverage ratio at KBC Bank 6.5% * 6.4% 6.0% * 5.9%* 5.8% * * 5.5% ** 5.2% 5.2% 4.8%* 4.8% * 4.7%* * 4.4% 1Q20 1H20 9M20 FY20 1Q21 1H21 1Q20 1H20 9M20 FY20 1Q21 1H21 * No IF

  39. Slide 39: Strong and growing customer funding base with liquidity ratios remaining very strong

    Strong and growing customer funding base with liquidity ratios remaining very strong  KBC Bank continues to have a strong retail/mid-cap deposit base in its core markets – resulting in a stable funding mix with a significant portion of the funding attracted from core customer segments and markets 

  40. Slide 40: Upcoming mid-term funding maturities

    Upcoming mid-term funding maturities Breakdown Funding Maturity Buckets  In January 2021, KBC Group issued a senior benchmark for an (Including % of KBC Group’s balance sheet) amount of 750m EUR with an 8-year maturity with call date after 7 7000 years 6000  In May 2021, KBC Group issued a senior

  41. Slide 41: KBC has strong buffers cushioning Sr. debt at all levels (1H21)

    KBC has strong buffers cushioning Sr. debt at all levels (1H21) KBC Group Senior 6 964 Tier 2 2 181 KBC Bank Additional Tier 1 KBC Insurance 1 500 Subordinated on loan by KBC Group Tier 2 6 964 CET1 (transitional) 500 18 728 Tier 2 Parent shareholders equity 116 1 681 Buffer for Sr. level 22.4 bn EU

  42. Slide 42: KBC complies with resolution requirements

    KBC complies with resolution requirements New MREL targets applicable as from 01-01-2024, with intermediate targets as from 01-01-2022  The resolution plan for KBC is based on a Single Point of Entry (SPE) approach at KBC Group level, with bail-in as the preferred resolution tool  The SRB communic

  43. Slide 43: Available MREL as a % of RWA and LRE (BRRD2)

    Available MREL as a % of RWA and LRE (BRRD2) Available MREL as a % of RWA 27.9% * 28.0% * 26.2% * * 26.3%* 27.4%  The MREL ratio in % of RWA increased q-o-q due mainly 25.6% 25.6% MREL requirement to the issuance of 2 new HoldCo Senior instruments with 25.88% by 2022 total amount of 950m EUR during

  44. Slide 44: Clean HoldCo Project

    Clean HoldCo Project KBC is in process of developing a “Clean HoldCo” project which will be implemented by 01-01-2024  Besides a total MREL amount, BRRD2 also requires Banks to maintain a certain part of MREL in subordinated format (i.e. instruments subordinated to liabilities, excluded from bail-i

  45. Slide 45: Latest credit ratings

    Latest credit ratings Moody’s S&P Fitch Senior Unsecured Baa1 A- A Tier II - BBB BBB+ Group Additional Tier I Ba1 BB+ BBB- Short-term P-2 A-2 F1 Outlook Stable Stable Negative Covered Bonds Aaa - AAA Senior Unsecured A2 A+ A+ - BBB - Bank Tier II Short-term P-1 A-1 F1 Outlook Stable Stable Negative

  46. Slide 46: Contents

    Contents 1. Strategy and business profile 2. Financial performance 3. Solvency, liquidity and funding 4. Covid-19 5. Covered bond programme 6. Green bond framework 7. Looking forward Appendices 46

  47. Slide 47: Covid-19

    KBC Group Section 2 Covid-19 47

  48. Slide 48: COVID-19 Expected credit loss (ECL) (1/6)

    COVID-19 Expected credit loss (ECL) (1/6) q-o-q decrease of 129m EUR Impairment on financial assets at AC and at FVOCI  The updated assessment of the impact of Covid-19 on the 121 performing and non-performing portfolios after 1H21, 1Q20 43 78 resulted in a total collective Covid-19 ECL of 628m EUR

  49. Slide 49: COVID-19 ECL (2/6) by country

    COVID-19 ECL (2/6) by country Collective Covid-19 ECL by country: End of June'21 Performing portfolio impact Non- Optimistic Base Pessimistic Probability Performing 1H21 2Q21 1Q21 4Q20 3Q20 2Q20 1Q20 EUR m 10% 80% 10% weigthed portfolio KBC Group 447 542 837 562 66 628 -129 -26 -1 -5 746 43 By count

  50. Slide 50: COVID-19 (3/6) IFRS macroeconomic scenarios

    COVID-19 (3/6) IFRS 9 macroeconomic scenarios Macroeconomic scenarios June 2021 Real GDP growth 2021 2022  The economic outlook is more optimistic compared to Optimistic Base Pessimistic Optimistic Base Pessimistic Annual average growth (in %) previous quarter, driven by the largely resolved Euro a

  51. Slide 51: COVID-19 (4/6) Diversified loan portfolio

    COVID-19 (4/6) Diversified loan portfolio Total loan portfolio outstanding by sector Total loan portfolio outstanding in % of total Group outstanding* by segment* 182bn EUR Corporate 33.9% 44.3% Retail Mortgages 41.0% Consumer Finance 3.3% Retail 21.9% 10.7% SME Services Distribution 7.1% Finance an

  52. Slide 52: COVID-19 (5/6) Loan portfolio by sector sensitivity

    COVID-19 (5/6) SME & Corporate loan portfolio* broken down by sector sensitivity to Covid-19  From mid-2020, a sectoral risk effect was incorporated into the calculation of the collective 4% of the total SME & Corporate loan portfolio is categorised as Covid-19 ECL impact. All exposures in the SME

  53. Slide 53: COVID-19 (6/6) Payment holidays and guarantee schemes

    COVID-19 (6/6) Overview of payment holidays and public Covid-19 guarantee schemes Payment holidays – expiring volumes Public Covid-19 guarantee schemes (in bn EUR) (in m EUR) By the end of June 2021: Loans Covered by  The volume of loans granted payment holidays, amounted to BU HU 4% granted govern

  54. Slide 54: Contents

    Contents 1. Strategy and business profile 2. Financial performance 3. Solvency, liquidity and funding 4. Covid-19 5. Covered bond programme 6. Green bond framework 7. Looking forward Appendices 54

  55. Slide 55: KBC's covered bond programme

    KBC’s covered bond programme Residential mortgage covered bond programme The covered bond programme is considered as an important funding tool for the treasury department. KBC’s intentions are to be a frequent benchmark issuer if markets and funding plan permit. Issuer: • KBC Bank NV • min 105% of c

  56. Slide 56: KBC's covered bond programme: Belgian legal framework

    KBC’s covered bond programme Belgian legal framework  Direct covered bond issuance from a bank’s balance sheet  Dual recourse, including recourse to a special estate with cover assets included in a register  The special estate is not affected by a bank’s insolvency National Bank of  Requires lic

  57. Slide 57: KBC's covered bond programme: Strong legal protection mechanisms

    KBC’s covered bond programme Strong legal protection mechanisms 1  The value of one asset category must be at least 85% of the nominal amount of covered bonds Collateral type • KBC Bank selects residential mortgage loans and commits that their value (including collections) will be at least 105% 2 

  58. Slide 58: KBC's covered bond programme: Cover pool

    KBC’s covered bond programme Cover pool  COVER POOL: BELGIAN RESIDENTIAL MORTGAGE LOANS • Exclusively, this is selected as main asset category • Value (including collections) at least 105% of the outstanding covered bonds • Branch originated prime residential mortgages predominantly out of Flanders

  59. Slide 59: Contents

    Contents 1. Strategy and business profile 2. Financial performance 3. Solvency, liquidity and funding 4. Covid-19 5. Covered bond programme 6. Green bond framework 7. Looking forward Appendices 59

  60. Slide 60: KBC Green bond framework

    Sustainability KBC Green bond framework Rationale: enhancing the KBC sustainability strategy Aligned with best practices and market developments  KBC is convinced that the financial industry has a key role to play in the  The KBC Green Bond Framework is in line with the Green Bond transition to a

  61. Slide 61: Green bonds

    Sustainability Green bonds KBC GREEN PORTFOLIO APPROACH Certification KBC will ensure the Inclusion of availability of sufficient Green  The Climate Bonds Standard Board existing and approved the certification of the KBC Assets to match Green new Green Green Bonds funding Assets Verification Green

  62. Slide 62: Contents

    Contents 1. Strategy and business profile 2. Financial performance 3. Solvency, liquidity and funding 4. Covid-19 5. Covered bond programme 6. Green bond framework 7. Looking forward Appendices 62

  63. Slide 63: Looking forward

    Looking forward  The progress of the vaccination campaigns was the main driver of global economic growth in the second quarter. Despite the appearance of new infectious virus variants, recent data suggest a decoupling of the rate of infections from the rates of hospitalization and Intensive Care Un

  64. Slide 64: Long-term financial guidance

    Differently: the next level Long-term financial guidance Long-term financial guidance CAGR total income (‘20-’23) + 2% by 2023 CAGR OPEX excl. bank taxes (’20-’23) + 1% by 2023 Combined ratio ≤ 92% by 2023 Common equity ratio* 14.5%, with a management buffer of 1% on top of as of now * Fully loaded,

  65. Slide 65: Digital investment 2021-2023

    Differently: the next level Digital investment 2021-2023 OPEX excl. bank taxes 2020 2023 8% 11% CAGR (20-23) = +1% 92% 89% Other Digital first Forecast Cashflow only digital first strategy Forecast OPEX only digital first strategy 2021-2023 = 1.4bn EUR 2021-2023 = 1.1bn EUR 2021 505 2021 348 2022 47

  66. Slide 66: Dividend policy & capital distribution: unchanged guidance

    Differently: the next level Dividend policy & capital distribution: unchanged guidance • In calendar year 2021, KBC has the intention to pay out 3.44 EUR gross DPS in total: • For the accounting year 2020, a gross DPS of 0.44 EUR was approved at the AGM and has been paid out on 19 May 2021 • It is t

  67. Slide 67: Appendices

    Appendices 1. Overview of outstanding benchmarks 2. Summary of KBC’s covered bond programme 3. Solvency: details on capital 4. Details on business unit international markets 5. Details on credit exposure of Ireland 67

  68. Slide 68: Annex 1 - Outstanding benchmarks

    Annex 1 - Outstanding benchmarks Overview till end of July 2021 Amount Own Type Issuer Maturity coupon ISIN reset spread Trigger Level MREL (in mio) funds Additional Tier1 temporary   AT1 24/04/2018 KBC Group 1 000 € Perpetual 4,250% BE0002592708 MS 5Y+ 359,4bps write-down 5,125% temporary   AT1

  69. Slide 69: Annex 2 – Key cover pool characteristics

    Annex 2 – KBC’s covered bond programme Key cover pool characteristics Investor reports, final terms and prospectus are available on www.kbc.com/covered_bonds Portfolio data as of : 30 June 2021 Total Outstanding Principal Balance 16 065 714 970 Total value of the assets for the over-collateralisatio

  70. Slide 70: Annex 2 – Key cover pool characteristics

    Annex 2 – KBC’s covered bond programme Key cover pool characteristics REPAYMENT TYPE (LINEAR VS. ANNUITY) GEOGRAPHICAL ALLOCATION Brussels Hoofdstedelijk gewest 6% Waals Brabant Linear 1% 1% Oost- Vlaanderen Vlaams 18% Brabant 18% West- Vlaanderen 14% Luxemburg Antwerpen Annuity 0% Henegouwen 28% Li

  71. Slide 71: Annex 2 – Key cover pool characteristics

    Annex 2 – KBC’s covered bond programme Key cover pool characteristics FINAL MATURITY DATE SEASONING 30 80 Weighted Average 70 25 Seasoning: 60 Weighted Average 54.3 months Remaining Maturity: 20 50 184 months 40 15 30 10 20 10 5 0 2018 - 2022 2023 - 2027 2028 - 2032 > 2032 0 0 - 12 13 - 24 25 - 36 3

  72. Slide 72: Annex - Belgian real estate market

    Annex 2 - Belgian real estate market Housing market remained strong during the pandemic crisis due to strong investor appetite for real estate 72

  73. Slide 73: Annex - Government bond market

    Annex 2 - Government bond market Belgian spread vs. 10y German Bund forecast seen at 25 bps in the coming quarters 73

  74. Slide 74: Annex - Solvency details

    Annex 3 - Solvency details Overview of B3 CET1 ratios at KBC Group * FICOD: Financial Conglomerate Directive ** DC: Danish Compromise *** DM: Deduction Method 74

  75. Slide 75: Annex – Business unit international markets

    Annex 4 – Business unit international markets Business profile BELGIUM CZECH GROUP SLOVAKIA HUNGARY BULGARIA IRELAND REPUBLIC CENTRE 2Q21 NET RESULT (in million euros) 528m 168m 22m 75m 30m 13m -42m ALLOCATED CAPITAL (in billion euros) 7.3bn 1.8bn 0.6bn 0.8bn 0.4bn 0.7bn 0.2bn LOANS (in billion euro

  76. Slide 76: Annex - Ireland: Impaired loans continues to improve

    Annex 5 - Ireland Impaired loans continues to improve IMPAIRED IMPAIRED LOANS IMPAIRED PROVISIONS PD LOAN PORTFOLIO €m OUTSTANDING LOANS LOANS PD 10-12 PD 10-12 • The outlook for the Irish economy continues to improve, 10-12 COVERAGE Owner occupied mortgages 9,779 1,204 12% 319 27% although material

  77. Slide 77: Glossary (1/2)

    Glossary (1/2) AQR Asset Quality Review B3 Basel III CBI Central Bank of Ireland [technical insurance charges, including the internal cost of settling claims / earned premiums] + [operating expenses / written premiums] (after reinsurance Combined ratio (non-life insurance) in each case) Common equit

  78. Slide 78: Glossary (2/2)

    Glossary (2/2) MARS Mortgage Arrears Resolution Strategy MREL Minimum requirement for own funds and eligible liabilities PD Probability of default Return on allocated capital (ROAC) for a [result after tax, including minority interests, of a business unit, adjusted for income on allocated capital in

  79. Slide 79: Contacts / Questions

    Contacts / Questions Download the KBC IR APP Company website: www.kbc.com 79

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