KBC Bank may sell Irish unit, has €15bn of loans and mortgages outstanding
The bank is keeping its options open for the unit including a sale – it had €15.1bn of loans and mortgages outstanding at the end of the first quarter of the year.
It is considering “whether to organically grow a profitable bank, build a captive bank-insurance group or sell a profitable bank” it said today.
KBC Bank also said it intends to accelerate its repayments and to make final one at the end of 2017 at the latest, instead of at the end of 2020 as agreed with European Commission.
The group still owes €2bn, excluding penalties, of the €7bn state aid that it received at the height of the credit crisis.
It added that it plans to use one third of its excess capital generated until 2017 to make these payments.
While a sale of the business is an option, this is not a short-term plan, said analyst Ciaran Callaghan of Merrion Stockbrokers.
“Anecdotally, KBC already appears to be taking an aggressive approach to Irish mortgage and deposit pricing, offering some of the most competitive rates in the sector as it attempts to grow market share,” he said.
“Consequently it appears that KBC is likely to remain a real challenger to the pillar Irish banks (BoI, AIB) for the foreseeable future.”
Meanwhile, a statement from KBC Ireland said: “The future of KBC Bank in Ireland is to grow into a strong retail player offering compelling value to customers.”