KBC Bank & Insurance Group General Meeting of Shareholders 26 April 2001.

KBCBank & Insurance Group

General Meeting of Shareholders26 April 2001

2

1. Français

2. English

General Meeting of Shareholders

W. Breesch

Chairman of the Board of Directors

4

Financial structure in the US, the UK and the euro zone (end of 1999)

Outstanding bank loans

Outstanding securities debt securities shares

US UK Euro zone

77%

345%166%179%

124%

262%64%

198%

132%

177%90%87%

Table 1:

As a % of GDP

Source: own calculations on the basis of BIS, IMF and International Federation of Stock Exchanges (FIBV) data

5

18,9%

41,3%

21,0%

11,6%

7,2%

33,8%

49,7%

8,3%5,4%

2,8%

42,0%

29,8%

17,2%

9,8%

1,1%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

As

a %

of t

he to

tal

US UK Euro zone

Debt securities, non-financial companiesDebt securities, financial institutionsGovernment debt securitiesSharesBank loans

Proportion of bank loans, shares and debt securities (June 2000)

Source: KBC calculations based on IMF, BIS and International Federation of Stock Exchanges (FIBV) data.

Graph 1:

6

Direct recourse to the capital market by the private sector in the narrow sense of the term (June 2000)

73,5

%

60,9

%

60,9

%

59,5

%

49,7

%

48,8

%

46,3

%

39,5

%

36,9

%

0%

10%

20%

30%

40%

50%

60%

70%

80%

in %

US UK France Neth Belgium Italy Spain Germany Portugal

Outstanding shares and debt securities issued by non-financial companies as a % of total outstanding bank loans, shares and debt securities issued by non-financialcompaniesSource: KBC calculations based on BIS, IMF of International Federation Stock Exchanges (FIBV) data.

Graph 2:

7

Importance of institutional investors and direct recourse to the capital market by the private sector in the narrow sense of the term (1998)

Outstanding shares and debt securities issued by non-financial companiesas a % of total bank loans, shares and debt securities issued by non-financial companies

D

P

EI B

F

NL

VK VS

S

0

50

100

150

200

250

20 30 40 50 60 70 80

Inst

itutio

nal i

nves

tors

’ fin

anci

al a

sset

sas

a %

of

GD

P

Sources: OECD, Financial Market Trends, June 2000; IMF, BIS and International Federation of Stock Exchanges (FIBV).

Graph 3:

8

Increase in direct recourse to the capital market by the private sector in the narrow sense

27.40%

29.30%

32.40%

40.50%

49.00%

21.10%

34.40%

52.30%

67.30%

49.70%

36.90%

46.30%

48.80%

59.50%

39.50%

60.90%

60.90%

73.50%

10% 20% 30% 40% 50% 60% 70% 80%

US

UK

France

Germany

Netherlands

Belgium

Spain

Portugal

Italyjun-00dec-96

Outstanding shares and debt securities issued by non-financial companies as a % of totaloutstanding bank loans, shares and debt securities issued by non-financial companiesSource: IMF, BIS of International Federation Stock Exchanges (FIBV).

As a % of the total

Graph 4:

9

Equity underwriting in Europe

0

200

400

600

800

1.000

1.200

1.400

1.600

1.800

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

0

50.000

100.000

150.000

200.000

250.000

No. of transactions (left) Amount of transactions (right)

Source: Thomson Financial Securities Data, Morgan Stanley Dean Witter Research

in m

illio

ns o

f U

SD

Graph 5:

General Meeting of Shareholders

R. Vermeiren

President of the Executive Committee

11

KBC Bank & Insurance group KBC Group : Highlights

Financial Strategic Areas of activity

Banking Highlights Financial information

Insurance Highlights Financial information

KBC Group : Central Europe KBC Group : data per share

12

In millions of EUR 20001999 %

Consolidated profit - Group share *excl. gain on CCF

- Banking *excl. gain on CCF- Insurance- Holding company *excl. gain on CCF

Key figures per share (in EUR)- Net earnings *excl. gain on CCF- Net dividend- Net asset value- Price/NAV

969.7 969.7714.7714.7271.3-16.3

3.263.26

0.922533.8

2.1

1820.7 1165.51520.9

876.7320.6-20.9-31.8

6.093.90

1.06535.2

1.6

87.7 20.2112.8

22.718.2

-

- 19.515.4

4.11.3

Highlights

13

Solid solvency ratios

2000

Group ROE

Bank Tier-1 ratio CAD ratio Cost/income

Insurance Solvency ratio (1) Combined ratio

16.1%

7.2%

11.5%

60.0%

311%

103.4%

23.3%

9.5%

16.0%

64.2%

307%

106.6%

(1) excl. unrealized gains

1998

20.5%

7.4%

12.8%

63.6%

298%

106.1%

1999

14

Strategic Highlights

Shareholding in CCF sold at a gain of 763 m EUR

Growing presence in Central Europe

Sharp increase in assets under management

Merger progressing as planned

Strategy updated and objectives enhanced

15

Strategic focus Focus on 4 activities

Retail bancassurance Corporate services Asset management Market activities

Focus on Europe Belgium: home market Central Europe: second home market Western Europe: smaller countries/regions, niches

Other regions, if higher return than generally targeted

Focus on ‘local’ clients Retail SME

16

Profit Contribution by Activity

1999 2000

353

452

2066

109

148

91

13191

173

306

196

+28%

+230%

+36%+44%

+90%-36%

In m

illio

ns o

f E

UR

Retailbancassurance

CentralEurope

Corporateservices

Assetmanagement

Marketactivities

Groupitems

% profit contribution 36% 39% 2% 6% 11% 13% 9% 11% 9% 15% 32% 17%

17

Minimum Target

Realized 31 Dec. ‘00

ROE at holding-co.level

EPS growth

Cost/income ratio bank

Combined ratio insurer

Tier-1 ratio bank

CAD ratio bank

Solvency ratio insurer

22%

15% p.a.

55% by 2004

103% by 2004

7%

11%

200%

23.3%

19.6%

64.2%

106.6%

9.5%

16%

307%

Overall financial targets

18

KBC Bank & Insurance group

KBC Group : Highlights Financial Strategic Areas of activity




19

BankingHighlights

Financial Strong operating results

Operating result : + 16.3 % Increase in costs slightly higher than increase in income Merger :

Income synergies better than expected Merger costs > merger savings

Strategic Sale of shareholding in CCF Greater presence in Central Europe Investment in securities business in UK

20


3868-2524

1344

-565

207

986

-183

-88

715

715

4656-3094

1562

-334

693

1922

-243

-158

1521

877

20.422.6

16.3

-41.0

-

95.0

32.8

-

112.7

22.7

BankingSummary

Gross operating incomeGeneral expenses

Operating result

Value adjustments and provisionsExtraordinary result

Profit before tax

Taxes

Minority interests

Profit after tax

Profit after tax excl. CCF

21

1960

732

610

133

2157

636

756

319

2437

836

1034

349

1998 1999 2000

In m

illio

ns o

f E

UR

+9%

+37%

+31%

+13%

+20.4%

Total3435

Total3868

Total4656

BankingIncome Stream

Other income 8% 8%Commission income 20% 22%Profit on financial transactions 16% 18%Net interest income (incl. dividends) 56% 52%

% of total income 1999 2000

22






23

Insurance Highlights

Financial Strong increase in premium income (+26.5%) Good loss ratios in direct non-life insurance

Strategic Stronger development in Central Europe, thanks to

Warta shareholding Further development of bancassurance

24

InsuranceOverview

In millions of EUR 2000

Net premiums Life Unit-linked Non-life

Net technical charges

Investment incomeGeneral admin. expensesOperating result

Non-recurring resultExtraordinary resultProfit before tax

TaxesMinority interestsProfit after tax

1999

2095420935741

-2126

688-344314

16-12316

-41-4

271

%

2651423

1459769

-2335

432-374374

25-5

392

-742

321

26.50.7

56.13.8

9.8

-37.28.8

19.1

- -

29.6

80.3-

18.2

25

InsuranceBusiness mix

1999Gross premiums

2144.5 million EUR

fire 8%

Acceptedbusiness

8%

motor 12%

Individuallife 58%

Group life 4%

Other non-life

10%

2000Gross premiums

2704.7 million EUR (+26.1%)

Individuallife65%

Group life 4%

Fire 7%

Acceptedbusiness

6%

Motor 10%

Othernon-life 8%

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Retail Bancassurance in BelgiumCross-selling penetration

Total clients bank1 337 204 (=) Total clients insurance

743 716 (+6.1%)

Cross-selling

510 896 clients holding at least 1 bank AND 1 insurance product 32.5% of overall client base 38.2% of bank client base

155 750 clients holding at least 3 bank AND 3 insurance products 9.9% of overall client base 11.6% of bank client base

510 896Mutualclients

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Central Europe

PolandKredyt BankAgropolisaWarta

Czech & Slovak Rep.CSOBCSOB Pojist’ovnaPatria

HungaryK&H BankK&H Bank after mergerK&H LifeArgosz

49.9% (+1.4%)49.9% (+26.6%)40.0% (+40%)

81.5% (-0.8%)75.8% (=) 91.9% (+91.9%)

73.3% (+40.7%)60%50%95.4% (=)

Ownership (comp. '99)

213.47.2

123.2

1361.911.949.0

132.1- 2.5

23.9

investmentin millions of EUR

5.8%0.6%

12%

23.4%0.5% -

8.8%15.1%0.5%3.1%

market share

Total amount invested : 2 bn EUR

29

Central Europe

Overview 1999 2000

Profit contribution % contribution to Group result Allocated equity Share in allocated equity ROE Credit volume, incl.Kredyt Bank (1)

Credit volume as % of total credit volume

Personnel (in FTEs) No. of branches

(1) Kredyt Bank at 50%

20.3 m EUR

2.1%

603.9 m EUR

14.3%

7.6%

4 313.2 m EUR

6.54%

13 581

490

66.3 m EUR

5.7%

795.1 m EUR

13.8%

10.4%

6 676.5 m EUR

8.29%

14 700

841

30






31

Key Figures per share

2000

Net profit

Gross dividend (1)

Net dividend per ordinary share

Payout ratio

2.69

1.09

0.82

40.6%

3.90

1.42

1.065

36.4%

(1) proposed

(2) payable 30 April 2001

1998

3.26

1.23

0.9225

37.7%

1999

+19.5%

+15.4%

(2)

32

Yield KBC Bel-20 DJEuroStoxx Banks

1 year (2000) -11.3% -6.0% 7.5%

3 year (1998-2000) 7.9% 11.1% 15.7%

6 year (1995-2000) 21.1% 17.6% 23.5%

Information of shareholders

0100200300400500600

Dec-94 Dec-95 Dec-96 Dec-97 Dec-98 Dec-99 Dec-00

KBC DJ EURO STOXX Banks Bel 20

KBCBank and InsuranceHolding Company

Company results

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Dividend incomeOther incomeInterest chargesTotal gross income

Staff and operating chargesOperating result

TaxesExtraordinary resultProfit after tax

Contribution to consol. result

382.8 0.5

-10.9372.4

-2.2370.2

-5.1263.0628.1

-16.3

KBC Bank and Insurance Holding CompanyCompany results

462.80.2

-43.6419.4

-3.8415.6

5.110.5

431.2

-20.9

+ 12.6%

+ 12.3%

- 31.3%

-

35

• Proposed net dividend per ordinary share 1.065 EUR

In thousands of EUR

Profit to be appropriated

Appropriations to capital and reserves• to the legal reserve• to other reserves

Profit (Loss) to be carried forward

Profit to be paid out• Dividends• Directors' entitlements

436 576

29810 000

448

424 4691 361

KBC Bank and Insurance Holding CompanyProposed dividend and appropriation of profit

KBCBank & Insurance Group

General Meeting of Shareholders26 April 2001

KBC Bank & Insurance Group General Meeting of Shareholders 26 April 2001.

Documents

Transcript of KBC Bank & Insurance Group General Meeting of Shareholders 26 April 2001.