Kbc Group N.v. · EURONEXT:KBC
Kbc — Debt Investor Presentation (February 2022)
86 slides from Kbc's debt investor presentation, February 2022
Slide 1: KBC Group Debt presentation
KBC Group Debt presentation February 2022 More infomation: www.kbc.com KBC Group - Investor Relations Office – E-mail: IR4U@kbc.be
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
Slide 3: Market share and real GDP growth
Market share (end 2021) BE CZ SK HU BG IRL 19% 20% Loans and deposits 11% 11% 11% 9%* 3.8m clients 4.2m clients 439 branches 28% 208 branches 23% 108bn EUR loans 33bn EUR loans 12% 10% Investment funds 7% 130bn EUR dep. 45bn EUR dep. IRELAND 22% 0.8m clients 13% 123 branches Life insurance 8% 3% 3%
Slide 4: KBC Passport
KBC Passport Group’s legal structure and issuer of debt instruments KBC Group NV Clean Holdco ultimately 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 Wholesale EMTN * To ensure
Slide 5: Latest credit ratings
Latest credit ratings Moody’s S&P Fitch Senior Unsecured Baa1 A- A Latest updates: Baa2 • 12 October 2021: Fitch revised the outlooks on KBC Tier II BBB BBB+ Group Group and KBC Bank to stable. The revision of the Additional Tier I Ba1 BB+ BBB- outlook reflects Fitch’s updated economic assumptions S
Slide 6: ESG ratings and indices
ESG ratings and indices Ahead of the curve Agencies ESG rating of 1st of Feb 2022 (previous score) Position versus industry average D- A • Financial services average B A- (A-) Severe Risk High Risk Medium Risk Low Risk Negligible Risk • 2nd percentile of 415 diversified banks assessed • 5th of 415 d
Slide 7: Contents
Contents 1. Strategy and business profile SHAREHOLDER STRUCTURE AT END 2021 Other core MRBB 2. Financial performance 7.3% Cera 11.5% 3. Solvency, liquidity and funding 2.7% 4. Covid-19 KBC Ancora 18.6% 5. Covered bond programme 59.9% Free float 6. Green bond framework 7. Looking forward Roughly 40
Slide 8: 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 be 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 reta
Slide 9: KBC Group in a nutshell (2)
KBC Group in a nutshell (2) High profitability C/I ratio* Combined ratio Net result Solid capital position... Fully loaded Basel 3 CET1 ratio of KBC Group (Danish Compromise) 17.6% 17.6%* 17.5% * 2614m 16.3% * 16.6% * 16.6% * 16.4%* 15.5% 55% 89% EUR 1440m 57% 85% 11.23% Maximum Distributable Am
Slide 10: Differently THE NEXT LEVEL: winning factors
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-hass
Slide 11: 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
Slide 12: KATE
KATE Kate4MassRetail Kate4Business Kate is a personal virtual assistant that engages with our Kate will also engage with our SME and corporate retail customers to save them time and money. clients with relevant and actionable insights that are Kate engages both in a reactive way (You2Kate) and a per
Slide 13: The strong basis remains
Differently THE NEXT LEVEL The strong basis remains + + 13
Slide 14: Bank-insurance+
Differently THE NEXT LEVEL Bank-insurance+ 14
Slide 15: Update on our 4 operational targets (1)
Differently THE NEXT LEVEL Translating strategy into non-financial targets Update on our 4 operational targets (1) Customer NPS ranking % bank-insurance (BI) clients Top-3 85% Top-2 77% 78% Top-2 22% 23% 27% 2020 2021* target '23 2020 BI 2021 BI target '23 2020 2021 target '23 KBC is 3rd in custom
Slide 16: Update on our 4 operational targets (2)
Differently THE NEXT LEVEL Translating strategy into non-financial targets Update on our 4 operational targets (2) % digital sales STP score* (bank / insurance) (straight through processing) 40% 39% 32% 25% 80% 19% 60% 49% 15% 33% 41% 25% 2020 2021 target 2020 2021 target 2020 2021 target '23 2020 2
Slide 17: 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. The
Slide 18: Our sustainability roadmap
Our sustainability roadmap KBC milestones and initiatives Equator Principles Joined the UN Global compact and We have been a signatory to the Equator Principles (Eps) published first sustainability report over FY 2005 since 2004 and have integrated them in our lending policy of project finance 2006
Slide 19: Our sustainability ambitions
Our sustainability ambitions We substantially raise the bar for our climate-related ambitions Achieved Above track Achieved Volume of SRI Funds(*) Renewable energy loans Direct coal-related finance (In billions of EUR) (In % of total energy-sector loan portfolio) (In millions of EUR) 32 30 252 61% 6
Slide 20: Strong progress on ESG
Strong progress on in Environmental, Social and Governance issues Some highlights ESG ESG ESG Environmental Social Governance We successfully issued our third Continued to look for a good Completion of a leadership 750-million euros KBC Green Bond balance between work and private development p
Slide 21: Contents
Contents 1. Strategy and business profile 2. Financial performance BREAKDOWN OF ALLOCATED CAPITAL BY BUSINESS UNIT AS AT 31 December 2021 3. Solvency, liquidity and funding 4. Covid-19 Czech Republic 15% 5. Covered bond programme 6. Green bond framework Belgium 63% 20% 7. Looking forward Internation
Slide 22: Key takeaways for KBC Group: 4Q21 financial performance
Key takeaways for KBC Group 4Q21 financial performance Commercial bank-insurance franchises in core markets FY21 performed excellent Customer loans and customer deposits increased y-o-y in ROE 15%* most of our core countries Cost-income ratio excluding bank taxes 51% KBC converted its two
Slide 23: Capital deployment, dividend proposal and guidance
Key takeaways for KBC Group Capital deployment, dividend proposal and short & long-term financial guidance For FY21: As of FY22: A final gross dividend of 7.6 EUR per share, bringing the total gross dividend Short-term financial guidance for 2022 (see slide 65) to 10.6 EUR per share, will be pro
Slide 24: Main exceptional items
Main exceptional items 2Q21 4Q21 1Q21 3Q21 4Q20 GROUP Opex – Update of software capitalisation policy +10m EUR Impairments – Software -59m EUR Total Exceptional Items GROUP -49m EUR NII – One-off technical item (insurance) +5m EUR Non-Life technical charges – flood impact above the legal limit (soli
Slide 25: Net result at KBC Group
Net result at KBC Group CONTRIBUTION OF BANKING ACTIVITIES TO KBC GROUP NET RESULT* 639 546 572 508 437 412 NET RESULT AT KBC GROUP* Amounts in m EUR 42 793 697 -11 663 601 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 538 557 210 CONTRIBUTION OF INSURANCE ACTIVITIES TO KBC GROUP NET RESULT* -5 173 157 1Q
Slide 26: Contribution of business units to FY21 result
Overview of contribution of business units to FY21 result Amounts in m EUR NET PROFIT – KBC GROUP FY21 ROAC: 22% 2,575 2,570 2,614 2,489 462 621 663 702 1,440 2,113 538 1,948 1,787 1,951 902 2017 2018 2019 2020 2021 4Q 9M NET PROFIT – BELGIUM NET PROFIT – CZECH REPUBLIC NET PROFIT – INTERNATIONAL MA
Slide 27: Higher net interest income and net interest margin
Higher net interest income and net interest margin Net interest income (1,177m EUR) NII Amounts in m EUR • NII increased by 6% q-o-q, driven primarily by: o organic loan volume growth 1,195 1,122 1,112 1,177 1,083 15 1,067 1,068 1,094 o a positive impact of the CNB and MNB rate hikes 111 17 14 15
Slide 28: Higher net fee and commission income
Higher net fee and commission income F&C* Amounts in m EUR Net fee and commission income (479m EUR) • Up by 3% q-o-q and by 19% y-o-y 479 450 467 441 429 388 390 403 • Q-o-q increase was the result of the following: 229 234 237 250 o Net F&C income from Asset Management Services increased by 4% q-
Slide 29: Insurance premium income and combined ratio
Insurance premium income up y-o-y and excellent combined ratio PREMIUM INCOME (GROSS EARNED PREMIUMS) 832 861 740 712 715 745 735 740 297 267 382 292 272 256 375 Insurance premium income (gross earned premiums) at 861m EUR 276 • Non-life premium income (486m EUR) increased by 8% y-o-y in 4Q21 • Li
Slide 30: Non-life and life insurance sales
Non-life sales up y-o-y, life sales up q-o-q and down y-o-y NON-LIFE SALES (GROSS WRITTEN PREMIUM) 567 590 Sales of non-life insurance products 446 450 435 415 416 405 • Up by 7% y-o-y due to growth in all classes, but chiefly in the classes ‘Motor Comprehensive Cover’ and ‘Property’ 1Q20 2Q20 3Q2
Slide 31: Net losses from financial instruments at fair value
Small net losses from financial instruments at fair value and lower net other income 253 FIFV The q-o-q decrease in FIFV was attributable mainly to: • a negative change in ALM derivatives (especially due to a substantial increase of 126 Hungarian interest rates in ALM derivatives, not in hedge acc
Slide 32: Costs fully in line with guidance
Costs fully in line with guidance Operating expenses in FY21 excluding bank taxes, changes in the OPERATING EXPENSES consolidation scope and one-offs rose by 1.5% y-o-y (+1.0% y-o-y when also excluding FX), fully in line with our FY21 guidance of slightly below 1,338 1,320 Amounts in m EUR +2% lik
Slide 33: Net impairment releases and credit cost ratio
Net impairment releases and excellent credit cost ratio Net impairment releases 857 ASSET IMPAIRMENT Amounts in m EUR 12 • Loan loss impairment releases of 62m EUR in 4Q21 (compared with 66m EUR in 3Q21) due to: 141 746 122 21 o a 79m EUR reversal of collective Covid-19 ECL (lowering the total col
Slide 34: Loan loss experience at KBC
Loan loss experience at KBC FY21 FY20 FY19 FY18 FY17 AVERAGE CREDIT COST CREDIT COST CREDIT COST CREDIT COST CREDIT COST ‘99 –’21 RATIO RATIO RATIO RATIO RATIO Belgium -0.26% 0.57% 0.22% 0.09% 0.09% n/a Czech Republic -0.42% 0.67% 0.04% 0.03% 0.02% n/a International 0.36% 0.78% -0.07% -0.46% -0.74%
Slide 35: Impaired loans ratios
Impaired loans ratios, of which over 90 days past due KBC GROUP BELGIUM BU 3.3% 3.4% 3.3% 3.3% 2.5% 3.2% 3.2% 2.4% 2.4% 2.4% 3.1% 2.2% 2.3% 2.9% 2.2% 2.2% 1.9% 1.9% 1.8% 1.8% 1.8% 1.7% 1.6% 1.5% 1.1% 1.2% 1.2% 1.1% 1.2% 1.0% 1.0% 1.0% 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q20 2Q20 3Q20 4Q20 1Q21
Slide 36: Cover ratios
Cover ratios KBC GROUP BELGIUM BU 66.9% 66.1% 68.3% 67.4% 68.8% 66.9% 66.7% 62.4% 61.7% 63.5% 63.0% 64.1% 65.9% 65.4% 60.4% 62.6% 44.8% 45.2% 44.7% 46.0% 47.1% 46.4% 43.4% 42.9% 42.7% 44.9% 45.4% 45.6% 41.3% 40.3% 42.6% 39.4% 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21
Slide 37: Balance sheet
Balance sheet KBC Group consolidated at the end of December 2021 Total assets Total liabilities and equity (EUR 340bn) (EUR 340bn) Credit quality 160 199 Capital adequacy & liquidity position 64 23 3 15 27 19 14 98 7 52 Loan book (loans and advances to customers) Deposits from customers Investment p
Slide 38: Loans and deposits continue to grow
Balance sheet: Loans and deposits continue to grow in most countries 9% 4% 7% 6% 5% BE Loans** Retail Deposits*** -11% Y-O-Y ORGANIC* VOLUME GROWTH mortgages Loans** Retail Deposits*** mortgages 15% 6% 6% 7% 5% 6% 6% 13% CR 12% 4% Loans** Retail mortgages Deposits*** Loans** Retail Deposits*** Loans
Slide 39: Contents: CET1 requirements
Contents 1. Strategy and business profile Fully loaded Basel 3 CET1 ratio at KBC Group 2. Financial performance (Danish Compromise) 3. Solvency, liquidity and funding +4.3% +4.7% +7.2% 4. Covid-19 11.23% 10.81% 0.42% 2.50% 2.50% 8.31% 5. Covered bond programme 15.50% 0.45% 1.50% 0.45% 1.50% 0.45% 1.
Slide 40: Strong capital position (1)
Strong capital position (1) The fully loaded common equity ratio amounted to 15.5% at the end of FY21 based on the Danish Compromise. Fully loaded Basel 3 CET1 ratio at KBC Group (Danish Compromise) • The q-o-q decrease in 4Q21 was the result of the payout of a 7.6 EUR gross dividend per share (of
Slide 41: 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% * 20.1% * 19.7% * 2.1% T2 2.1% T2 1.9% T2 1.8% T2 1.8% T2 1.2% T2** 18.6% 1.5% AT1 1.5% AT1 1.9% T2** 1.4% AT1 1.6% T2** 1.5% AT1 1.5% AT1 1.5% AT1 1.4% AT1 1.4% AT1 17.6% CET
Slide 42: 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% 5.4% * 5.4% 5.2%* 4.8% * * 5.2% * 5.1% 4.8% 4.7% * 4.6% * 4.4% 1Q20 1H20 9M20 FY20 1Q21 1H21 9M21 FY21
Slide 43: Customer funding base and liquidity ratios
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
Slide 44: Upcoming mid-term funding maturities
Upcoming mid-term funding maturities Breakdown Funding Maturity Buckets (Including % of KBC Group’s balance sheet) 7000 KBC Bank has 6 solid sources of long-term funding: 6000 1.5% • Retail term deposits 5000 • Retail EMTN • Public benchmark transactions m EUR 4000 1.0% 3000 0.9% 0.8% • Covered bond
Slide 45: Strong buffers cushioning senior debt
KBC has strong buffers cushioning Sr. debt at all levels (2021) KBC Group Senior 7 437 Tier 2 2 931 KBC Bank Additional Tier 1 KBC Insurance 1 500 Subordinated on loan by KBC Group Tier 2 7 437 CET1 (transitional) 500 17 498 Tier 2 Parent shareholders equity 122 2 432 Buffer for Sr. level 21.9 bn EU
Slide 46: 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
Slide 47: Available MREL as a % of RWA and LRE
Available MREL as a % of RWA and LRE (BRRD2) Available MREL as a % of RWA * * * * 27.9% 27.4% * 28.0%* 27.9% 27.7%* 26.2% 25.6% 25.6% 26.3% MREL requirement The MREL ratio in % of RWA slightly decreased q-o-q, due entirely to 25.98% by 2022 the RWA increase. The available MREL roughly stabilized a
Slide 48: 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 48
Slide 49: Covid-19 Expected Credit Loss (ECL)
Covid-19 Expected Credit Loss (ECL) q-o-q reversal of 79m EUR Impairment on financial assets at AC and at FVOCI 1Q20 43 78 121 Since 2Q20, the calculation principles for the expert-based Covid-19 impact calculation at portfolio level have remained the same. Updates have been made 2Q20 746 99 845 ove
Slide 50: Covid-19 ECL by country
Covid-19 ECL by country Collective Covid-19 ECL by country: Total Total 4Q21 3Q21 2Q21 1Q21 4Q20 3Q20 2Q20 1Q20 FY21 FY20 EUR m KBC Group 289 -79 -260 -129 -26 783 -1 -5 746 43 By country: Belgium 100 -58 -169 -66 -20 413 3 -3 378 35 Czech Republic 69 -9 -56 -30 2 162 -5 9 152 6 Slovakia 20 0 -10 -6
Slide 51: Covid-19 IFRS macroeconomic scenarios
Covid-19 IFRS 9 macroeconomic scenarios Macroeconomic scenarios December 2021 Real GDP growth 2021 2022 The pandemic still plays a prominent role in shaping the Annual average growth (in %) Optimistic Base Pessimistic Optimistic Base Pessimistic macroeconomic landscape, with the Omicron variant se
Slide 52: Diversified loan portfolio
Covid-19 Diversified loan portfolio Total loan portfolio outstanding by sector Total loan portfolio outstanding as a % of total Group portfolio outstanding(1) by segment(1) 188bn EUR(2) Corporate 34.0% 44.4% Retail Mortgages 41.2% Consumer Finance 3.2% Retail 21.5% Services 10.3% SME Distribution 7.
Slide 53: Continued improvement of stage
Covid-19 Continue improvement of stage 3 Total loan portfolio outstanding • As of 3Q21, given the aim of returning fully to the regular impairment process, by IFRS 9 ECL stage* KBC has decided to capture part of the Covid-19 ECL by means of a collective 13.5% 13.6% transfer to Stage 2 of two Stage 1
Slide 54: Loan portfolio by sector sensitivity to Covid-19
Covid-19 SME & Corporate loan portfolio* broken down by sector sensitivity to Covid-19 Details of the sector sensitivity applied into the calculation of the In line with previous quarter, 4% of the total SME & Corporate loan collective Covid-19 ECL: portfolio is categorised as highly vulnerable (or
Slide 55: Payment holidays and public guarantee schemes
Covid-19 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 country: Loans Covered by By the end of December 2021: HU granted government The volume of loans granted payment holidays amou
Slide 56: 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 56
Slide 57: 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
Slide 58: Belgian legal framework for covered bonds
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 National Bank of The special estate is not affected by a bank’s insolvency Belgium Requ
Slide 59: Strong legal protection mechanisms
KBC’s covered bond programme Strong legal protection mechanisms 1 Collateral type The value of one asset category must be at least 85% of the nominal amount of covered bonds • KBC Bank selects residential mortgage loans and commits that their value (including collections) will be at least 105% 2
Slide 60: 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
Slide 61: 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 61
Slide 62: 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 Principles trans
Slide 63: 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 approved existing and the certification of the KBC Green Bonds Assets to match Green new Green funding Assets Verification Green
Slide 64: 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 64
Slide 65: Looking forward
Looking forward The fourth quarter saw economic dynamics diverging between the US and the euro area economy. While US growth dynamics accelerated quarter-on-quarter in Q4, economic growth in the euro area actually slowed down, mainly as a result of the impact of the fourth pandemic wave and the om
Slide 66: 3-year and long-term financial guidance
Differently: the next level 3-year and long-term financial guidance 3-year financial guidance* CAGR total income (‘21-’24) CAGR OPEX excl. bank taxes (’21-’24) + 4.5% + 1.5% by 2024 by 2024 } => Jaws of ± 3% => C/I ratio excl BT ±47% in 2024 Combined ratio ≤ 92% as of now Surplus capital ** > 15% as
Slide 67: Digital investment 2022-2024
Differently: the next level Digital investment 2022-2024 OPEX excl. bank taxes 2021 2024 8% 10% CAGR (21-24) = +1.5% 92% 90% Other Digital first Forecast Cashflow only digital first strategy Forecast OPEX only digital first strategy 2022-2024 = 1.4bn EUR Amounts in m EUR 2022-2024 = 1.1bn EUR 2022 4
Slide 68: Dividend policy & capital distribution as of 2022
Differently: the next level Dividend policy & capital distribution as of 2022 • We aim to be amongst the better capitalised financial institutions in Europe. As a consequence, the dividend policy of KBC Group is tailored to that purpose. Each year, the Board of Directors will decide, at its discreti
Slide 69: Appendices
Appendices 1. Full year 2021 performance 2. Overview of outstanding benchmarks 3. Summary of KBC’s covered bond programme 4. Solvency: details on capital 5. Details on business unit international markets 69
Slide 70: Annex 1 - KBC Group
Annex 1 - KBC Group FY 2021 net result amounted to 2,614m EUR Net result rose by 81% y-o-y to 2,614m EUR in 2021, mainly as a result of the following: Net Result • Revenues rose by 5% y-o-y mainly due to higher net fee & commission income, net result from FIFV, net other income and higher result f
Slide 71: Annex 1 - Net interest income
Annex 1 - Net interest income Roughly stable net interest income (NII) and lower net interest margin (NIM) NII Net interest income • Net interest income roughly stabilised y-o-y 4,618 -3% 4,467 0% 4,451 • Net interest income banking slightly increased y-o-y due mainly to: 452 52 o continued good l
Slide 72: Annex 1 - Net fee and commission income
Annex 1 - Net fee and commission income Higher net fee and commission income and AUM Net fee and commission income 1,734 1,836 1,609 Net fee and commission income • Increased by 14% y-o-y: -7% +14% o Net F&C from Asset Management Services increased by 17% y-o-y driven entirely by higher management
Slide 73: Annex 1 - Non-life insurance
Annex 1 - Non-life insurance Higher non-life insurance sales and excellent combined ratio Non-Life (Gross written premium) +3% 1,804 +6% 1,920 1,757 Sales of non-life insurance products Up by 6% y-o-y thanks to growth in all classes 2019 2020 2021 The non-life combined ratio for FY21 amounted to
Slide 74: Annex 1 - Other total income drivers
Annex 1 - The other total income drivers Higher fair value result and higher net other income Fair Value result The higher y-o-y figure for net gains from financial instruments at fair value was attributable to: • sharply higher net result on equity instruments (insurance) 181 145 • higher dealing
Slide 75: Annex 1 - Operating expenses
Annex 1 - Operating expenses Tight cost control Operating expenses -3% +6% Operating expenses in FY21 excluding bank taxes, changes in the consolidation scope 4,303 4,156 4,396 and one-offs rose by 1.5% y-o-y (+1.0% y-o-y when also excluding FX), fully in line with 491 525 503 our FY21 guidance of
Slide 76: Annex 1 - Asset impairments
Annex 1 - Asset impairments Net impairment releases and excellent credit cost ratio Asset impairment 1.182 Net impairment releases amounted to 261m EUR (compared with net 108 291 impairment charges of 1,182m EUR in FY20). This was attributable chiefly to: 217 783 • a 494m EUR reversal of collectiv
Slide 77: Annex 2 - Outstanding benchmarks
Annex 2 - Outstanding benchmarks Overview till end of January 2022 Additional Tier 1 securities: Issuer Currency Isin Code Issued (in mio) Coupon Re-off spread Settlement date Call date Maturity Trigger Level KBC Group EUR BE0002592708 1,000 4.25% M/S+359,4bps 24/04/2018 24/10/2025 Perpetual Tempora
Slide 78: Annex 3 - Key cover pool characteristics
Annex 3 – 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 : 31 December 2021 Total Outstanding Principal Balance 16 571 553 666 Total value of the assets for the over-collateralis
Slide 79: Annex 3 - Key cover pool characteristics
Annex 3 – KBC’s covered bond programme Key cover pool characteristics REPAYMENT TYPE (LINEAR VS. ANNUITY) GEOGRAPHICAL ALLOCATION Brussels Hoofdstedelijk gewest Linear 6% Waals Brabant 1% 1% Oost- Vlaanderen Vlaams 18% Brabant West- 18% Vlaanderen 14% Luxemburg Antwerpen Annuity 0% Henegouwen 28% 99
Slide 80: Annex 3 - Key cover pool characteristics
Annex 3 – KBC’s covered bond programme Key cover pool characteristics SEASONING 25 90 80 Weighted Average 20 Seasoning: 70 Weighted Average FINAL MATURITY DATE 54 months 60 Remaining Maturity: 186 months 15 50 40 30 10 20 10 5 0 2018 - 2022 2023 - 2027 2028 - 2032 > 2032 0 0 - 12 13 - 24 25 - 36 37
Slide 81: Annex 3 - Belgian real estate market
Annex 3 - Belgian real estate market Housing market performed strong during the pandemic crisis The dynamics of house prices strengthened to 8.2% yoy 81
Slide 82: Annex 4 - Solvency details
Annex 4 - Solvency details Overview of B3 CET1 ratios at KBC Group Method Numerator Denominator B3 CET1 ratio FICOD*, fully loaded 17,861 120,873 14.8% DC**, fully loaded 16,224 104,646 15.5% DM***, fully loaded 15,392 99,603 15.5% * FICOD: Financial Conglomerate Directive ** DC: Danish Compromise *
Slide 83: Annex 5 - Business unit international markets
Annex 5 – Business unit international markets Business profile BELGIUM CZECH GROUP SLOVAKIA HUNGARY BULGARIA IRELAND REPUBLIC CENTRE 4Q21 NET RESULT (in million euros) 486m 198m 18m 46m 29m -37m -77m ALLOCATED CAPITAL (in billion euros) 7.5bn 1.8bn 0.6bn 0.8bn 0.4bn 0.5bn 0.2bn LOANS (in billion eur
Slide 84: 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 in Combined ratio (non-life insurance) each case) Common equit
Slide 85: 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
Slide 86: Contacts / Questions
Contacts / Questions More information • Company website KBC • Quarterly Report • Table of results (Excel) Quarterly Reports • Quarterly presentation • Debt presentation Presentations Upcoming events 11 February 2022 Equity roadshow London 17 February 2022 Equity roadshow US W Coast 17 February 2022
KBC Group — Debt Investor Presentation (February 2022) on 6ix