KBC Group: KBC Bank Ireland confirms sale of substantially all of
its performing loan assets and liabilities to Bank of Ireland
Group. No immediate actions for customers
Press Release
Outside trading hours – Regulated information*
Brussels, 22 October 2021 (8.20 a.m. CEST, before
stock exchange hours)
KBC Bank Ireland confirms sale of
substantially all of its performing loan assets and
liabilities to Bank of Ireland Group
No immediate actions for
customers.
Following the announcement made on the
16th April 2021 that KBC Bank Ireland had entered into a
Memorandum of Understanding (MoU) with Bank of Ireland Group, KBC
Bank Ireland confirms that it has now entered into a legally
binding agreement with Bank of Ireland relating to the sale of
substantially all of KBC Bank Ireland’s performing loan assets and
its deposit book to Bank of Ireland Group. In
addition, a small portfolio of non-performing mortgages (NPEs) will
also be acquired as part of the
transaction.
The acquisition for a total
consideration of c.€5.0 billion (net of deposits), involves c.€ 8.8
billion of performing mortgages, c.€ 0.1 billion of mainly
performing commercial and consumer loans, c.€ 0.3 billion of
non-performing mortgages, and c. € 4.4 billion of
deposits. The exact size of the portfolio and
consideration payable will depend on movements in the portfolio up
to completion, but is not expected to materially
change.
Bank of Ireland Group will acquire the
portfolio and will fund it from its existing
resources.
KBC Bank Ireland customers do not need
to take any immediate action as a result of this announcement.
Customers can continue to access KBC Bank Ireland’s retail banking
and insurance products through its digital channels and hubs.
Customers will also continue to be afforded all legal and
regulatory protections. KBC Bank Ireland is focused on ensuring
that the migration of its customers to Bank of Ireland Group is
carried out in an orderly manner.
The transaction remains subject to
regulatory, including Irish competition, approvals.
The transaction will have an impact on
KBC Group’s P&L which is estimated at +0.2 billion euros at
completion. Furthermore, as the transaction would ultimately result
in KBC Group’s withdrawal from the Irish market, this will also
trigger a P&L impact in 3Q21 of an estimated -0.2 billion euros
(primarily increased impairment on limited non-performing loans
included in the transaction, provisions for restructuring costs and
the write-down of deferred tax, tangible and intangible
assets). Combined, it further improves KBC’s solid capital
position on completion of the transaction (expected in 3Q22), with
a positive impact of +0.9% pt. on the CET1 ratio primarily by
reducing risk-weighted assets by c.5 billion euros upon completion
of the transaction and a further 1 billion
thereafter.
As a result of this announcement, the
P&L of KBC Bank Ireland will be transferred from Business Unit
International Markets (KBC Group) to Group Centre as of 1 January
2022 (not retroactive).
KBC Bank Ireland has been very focused
on the welfare of its employees throughout this process. KBC Bank
Ireland remains acutely aware of the need to maintain open lines of
communication with its employees and to provide as much certainty
as possible in the context of this transaction. In this regard, KBC
Bank Ireland has recently engaged in a Redundancy Consultation
process with its Employee Council resulting in strong terms that
compare very favourably in the sector and reflect the bank’s deep
appreciation for the service given by its employees. KBC Bank
Ireland confirms that it will abide by the rules of the TUPE
legislation where applicable.
Following a notification to all
customers KBC will pause the acceptance of new applications for
PRSAs, Investments, Personal and Business Overdrafts, and Business
Credit Cards. For customers wishing to apply for a new Current
Account, Mortgage, Deposit, Personal Loan, Business Loans, Life,
Home and Car Insurance or Personal Credit Card we remain open for
business as usual.’
Further announcements/updates will be
made in due course.
Announcing the binding agreement, KBC
Group CEO, Johan Thijs, said : “Today’s agreement with
Bank of Ireland Group regarding the sale to Bank of Ireland Group
of substantially all of the performing loan assets and deposits of
KBC Bank Ireland and a small portfolio of non-performing mortgages
represents an important step in KBC Group’s withdrawal from the
Irish market. The transaction remains subject to regulatory
approvals. Yet, I’m confident that together with Bank of Ireland
Group our customers will be provided with a good home, whilst
continuing to enjoy the same legal and regulatory protections. We
remain committed to managing this process responsibly over the
coming period.”
Francesca McDonagh, Group CEO of Bank of
Ireland continued: “We are delighted to have reached
agreement with KBC on this important transaction. This acquisition
is a positive development for our business and consistent with our
growth strategy. We look forward to supporting our new customers on
their important financial decisions over the years ahead.”
KBC Bank Ireland CEO, Ales
Blazek added : “I would like to reassure our customers
that they do not need to take any immediate action at this point as
a result of this announcement. KBC Bank Ireland remains committed
to servicing customers of its retail banking and insurance products
through its digital channels and hubs. We will communicate to our
customers well in advance of any actual steps that may be taken
with respect to their products or if our customers need to take any
action at any point.
The Board and the Executive Committee of KBC
Bank Ireland are fully conscious of the responsibilities to our
customers and colleagues, and the role of KBC as part of the Irish
banking system, and we are committed to those responsibilities
until the transaction and subsequent withdrawal from the Irish
market have been completed. KBC Bank Ireland remains focused on the
welfare of its staff.”
For more information, please
contact:
KBC Group :
Viviane Huybrecht, General Manager, Corporate
Communication/Spokesperson, KBC Group
Tel +32 2 429 85 45 - E-mail:
viviane.huybrecht@kbc.be, pressofficekbc@kbc.be
Website : www.kbc.com
Kurt De Baenst, General Manager, Investor
Relations, KBC Group
Tel +32 2 429 35 73 - E-mail: IR4U@kbc.be
Bank of Ireland :
Damien Garvey, Head of Group External
Communications and Public Affairs, Group Corporate Affairs, Bank of
Ireland
Tel + 353 (0) 86 8314435 – E-mail:
Damien.garvey@boi.com
Darach O’Leary, Head of Group Investor
Relations, Bank of Ireland
Tel +353 (0) 87 948 0650 – E-mail
Darach.oleary@boi.com
KBC Bank Ireland
Edelman - Joe Carmody, CEO – Tel + 353 86 805 87
64 joe.carmody@edelman.com
* This announcement contains inside
information.
* This news item contains information that is subject to the
transparency regulations for listed companies. |
KBC Group NV Havenlaan 2 – 1080
Brussels Viviane Huybrecht
General Manager Corporate
Communication /Spokesperson Tel. +32 2 429
85 45 |
Press Office Tel. +32 2 429 65 01 Stef
Leunens Tel. +32 2 429 29 15 Ilse De
Muyer Tel. +32 2 429 32 88 Pieter
Kussé Tel. +32 2 429 85 44 Sofie
Spiessens E-mail:
pressofficekbc@kbc.be |
KBC press releases are available at
www.kbc.com or can be obtained by sending
an e-mail to pressofficekbc@kbc.be
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