KBC Group – overview (consolidated, IFRS) 1Q2021 4Q2020 1Q2020
Net result (in millions of EUR) 557 538 -5
Basic earnings per share (in EUR) 1.31 1.26 -0.04
Breakdown of the net result by business unit (in millions of EUR)
Belgium 380 396 -86
Czech Republic 123 94 88
International Markets 88 86 35
Group Centre -35 -38 -43
Parent shareholders’ equity per share (in EUR, end of period) 49.8 48.1 43.4
Brussels, 11 May 2021 (07.00 a.m. CEST)
KBC Group: First-quarter result of 557million euros
Light is starting to appear at the end of the tunnel thanks to the large-scale vaccination rollout that started in the first quarter of 2021. However, the coronavirus pandemic is still far from over and continues to cause human suffering and unprecedented economic upheaval all over the world. From the start of the crisis more than a year ago, we have taken responsibility in safeguarding the health of our staff and customers, while ensuring that services continue to be provided. We have also worked closely with
government agencies to support all customers impacted by coronavirus, implementing various measures such as loan deferrals.
We have, for example, granted payment holidays for 13.1 billion euros’ worth of loans under coronavirus-related moratoria (according to the EBA definition). For 91% of that figure, the moratoria have now expired, with 98% of loans resuming normal payments. We have also granted almost 1 billion euros’ worth of loans under public guarantee schemes introduced in response to
the pandemic.
Meanwhile, we continued to work tirelessly on implementing our strategy, including the further optimisation of our geographic presence. In the first quarter of 2021, we reached an agreement for the acquisition of NN’s Bulgarian pension insurance and life insurance businesses. This will allow us to further increase our share of the life insurance market in Bulgaria and to broaden our
bank-insurance offering to customers with the addition of high-end pension fund products, while also providing additional crossselling opportunities for banking and insurance products in a one-stop shop approach. Closure of the deal is subject to regulatory approval and is expected to be finalised in the course of 2021. More recently, in the context of the competitive market conditions in
Ireland, we entered into a Memorandum of Understanding with Bank of Ireland that could lead to a transaction where Bank of Ireland commits to acquire substantially all of KBC Bank Ireland's performing loan assets and liabilities. In addition, we are examining our options for divesting KBC Bank Ireland's portfolio of non-performing mortgage loans. Successful completion of both
transactions may ultimately result in our withdrawal from the Irish market. While these discussions are ongoing, KBC Bank Ireland remains committed to offering its existing and new customers retail banking and insurance services of the highest standard through its digital channels and hubs. The transaction remains subject to customary due diligence, further negotiation and agreement of
final terms and binding documentation, as well as obtaining all appropriate internal and external regulatory approvals.
As regards our financial results, the year got off to a strong start with a net profit of 557 million euros being posted in the quarter under review. This is a very good performance given that the bulk of bank taxes for the full year are recorded – as always – upfront in the first quarter of the year. In the quarter under review, nearly all income items increased, apart from dividend income. Costs – excluding bank taxes – continued to be strictly managed, resulting in a quarter-on-quarter decrease of 5%. We were also able to reverse some of the loan loss impairment charges taken previously, which had a positive impact on our net result. Our solvency position remained very strong with a common equity ratio of 17.6% on a fully loaded basis.
As announced earlier, we will pay out a gross dividend of 0.44 euros per share on 19 May 2021 for financial year 2020. It is also the intention of our Board of Directors to distribute an additional gross dividend of 2 euros per share in the fourth quarter of 2021 for financial year 2020.The final decision of the Board in this regard is subject to restrictions on dividends being lifted by the ECB.
In closing, I would like to take this opportunity to thank all stakeholders who have continued to put their trust in us. I also wish to express my appreciation to all our staff who have not only continued to serve our customers, but have also ensured that our group has been able to operate solidly and efficiently in these challenging times.
Johan Thijs
Chief Executive Officer

Financial highlights in the first quarter of 2021
- Commercial bank-insurance franchises in our core markets performed very well in the quarter under review.
- Net interest income increased by 1% quarter-on-quarter, when the positive 5-million-euro one-off item recorded in the previous quarter is excluded. This increase came about mainly on account of the consolidation of OTP Banka Slovensko, the appreciation of the Czech koruna and lower funding costs. Net interest income was down 11% on its year-earlier level, due in part to the negative impact of past CNB rate cuts in the Czech Republic, low
reinvestment yields and the year-on-year depreciation of the Czech koruna and Hungarian forint.
- Deposits, including debt certificates, grew by 8% quarter-on-quarter and 10% year-on-year.
Loan volumes were up 1% quarter-on-quarter and 1% year-on-year. These figures were calculated on an organic basis (excluding the recent acquisition of OTP Banka Slovensko and forex effects). The volume of loans that were granted payment holidays under the various relief schemes amounted to 13.1 billion euros according to the EBA definition. As most of the
moratoria have now expired, loans still falling under them had decreased by 91% by the end of March 2021. For 98% of loans under meanwhile expired moratoria, payments have resumed.
- Technical income from our non-life insurance activities (premiums less charges, plus the ceded reinsurance result) was up 11% on its level in the previous quarter and 31% on the level recorded in the first quarter of 2020. In both cases, this was due mainly to a significant decrease in technical charges. Overall, the combined ratio for the quarter under review
amounted to an excellent 78%. Sales of our life insurance products were down 19% on the high level recorded in the previous quarter and up 10% on their level in the year-earlier quarter.
- Net fee and commission income was 9% and 3% higher than its respective levels in the previous and year-earlier quarters, due to a combination of increased fees for our asset management activities and banking services (the latter thanks primarily to the securities business).
- The trading and fair value result was up 47 million euros on the level recorded in the previous quarter and by as much as 512 million euros compared to the first quarter of 2020. The latter figure had been significantly impacted by the effects of the first outbreak of the coronavirus
crisis, which initially led to sharply lower stock markets, widening credit spreads and lower long-term interest rates (causing the trading and fair value result to amount to a negative 385 million euros in that quarter).
- All other income items combined were in line with the figure recorded in the year-earlier quarter, and 32% higher than the figure recorded in the previous quarter, which had included a number of negative one-off items.
- Costs in the first quarter traditionally include the bulk of the full-year bank taxes (424 million euros). Excluding these taxes, costs were down 5% quarter-on-quarter and 4% year-on-year, thanks to strict cost management and notwithstanding the consolidation of OTP Banka Slovensko. The resulting cost/income ratio amounted to 53% in the quarter under review (in
the calculation, certain non-operating items have been excluded and bank taxes spread evenly throughout the year) or 46% (when all bank taxes have been fully excluded).
- The quarter under review included a net reversal of loan loss impairment of 76 million euros, compared to net charges of 57 million euros in the previous quarter and 121 million euros in the year-earlier quarter. As a consequence, the credit cost ratio in the quarter under review amounted to -0.17%, compared to 0.60% for full-year 2020 (a negative sign implies a positive
impact on the result).
- Our liquidity position remained strong, with an LCR of 157% and NSFR of 148%. Our capital base remained equally as robust, with a fully loaded common equity ratio of 17.6% (under ECB-rules, this does not include the interim profit for the first quarter).

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