KBC Bank
Encyclopedia
Bank
A bank is a financial institution that serves as a financial intermediary. The term "bank" may refer to one of several related types of entities:...
, focusing on private clients and small and medium-sized enterprises. Besides retail banking
Retail banking
Retail banking is banking in which banking institutions execute transactions directly with consumers, rather than corporations or other banks. Services offered include: savings and transactional accounts, mortgages, personal loans, debit cards, credit cards, and so forth.-Types of...
, insurance
Insurance
In law and economics, insurance is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for payment. An insurer is a company selling the...
and asset management activities (in collaboration with sister companies KBC Insurance NV and KBC Asset Management NV), KBC is active in European debt capital markets, domestic cash equity markets and in the field of corporate banking, leasing
Leasing
Leasing is a process by which a firm can obtain the use of a certain fixed assets for which it must pay a series of contractual, periodic, tax deductible payments....
, factoring
Factoring (finance)
Factoring is a financial transaction whereby a business job sells its accounts receivable to a third party at a discount...
, reinsurance
Reinsurance
Reinsurance is insurance that is purchased by an insurance company from another insurance company as a means of risk management...
, private equity
Private equity
Private equity, in finance, is an asset class consisting of equity securities in operating companies that are not publicly traded on a stock exchange....
and project and trade finance in Belgium, Central
Central Europe
Central Europe or alternatively Middle Europe is a region of the European continent lying between the variously defined areas of Eastern and Western Europe...
and Eastern Europe
Eastern Europe
Eastern Europe is the eastern part of Europe. The term has widely disparate geopolitical, geographical, cultural and socioeconomic readings, which makes it highly context-dependent and even volatile, and there are "almost as many definitions of Eastern Europe as there are scholars of the region"...
and elsewhere (mainly in Europe). KBC is an initialism for Kredietbank ABB Insurance CERA Bank.
The parent company, KBC Group N.V., is one of the major companies and the second largest bancassurer
Bancassurance
The Bank Insurance Model , also sometimes known as 'Bancassurance', is the term used to describe the partnership or relationship between a bank and an insurance company whereby the insurance company uses the bank sales channel in order to sell insurance products.BIM allows the insurance company to...
in Belgium. It is the 18th largest bank in Europe (by market capitalisation) and a major financial player in Central and Eastern Europe, employing some 57,000 staff worldwide (of which 32,000 in Central and Eastern Europe and Russia) and serving 11 million customers worldwide (some 8 million in Central and Eastern Europe).
The group is controlled by a syndicate of core shareholders, but has a free float of some 42%. In the core shareholders, CERA/KBC Ancora group controls 30%, MRBB (a farmers' association) controls around 13% and a group of industrialist families controls another 11%. The free float was chiefly held by a large variety of international institutional investors (close to 45% UK-or US-based) as of the end of 2010. Its shares are traded on the Euronext
Euronext
Euronext N.V. is a pan-European stock exchange based in Amsterdam and with subsidiaries in Belgium, France, Netherlands, Portugal and the United Kingdom. In addition to equities and derivatives markets, the Euronext group provides clearing and information services...
exchange in Brussels and the Luxembourg Stock Exchange
Luxembourg Stock Exchange
The Luxembourg Stock Exchange is a stock exchange based in Luxembourg City, in southern Luxembourg.The Exchange is located on avenue de la Porte-Neuve,...
.
The group's overall aim is to be an independent, medium-sized provider of bancassurance for private clients and enterprises in selected European countries, with a focus on asset management and in financial markets.
History
In 1889, the Catholic Volksbank van Leuven was founded, the earliest predecessor of the KBC Bank. In 1935, the banks Algemeene Bankvereeniging and Volksbank van Leuven merged with the Bank voor Handel en Nijverheid to create the Kredietbank. The Kredietbank would be the only Belgian financial institution under Flemish control which would survive the financial crisis of the great depressionGreat Depression
The Great Depression was a severe worldwide economic depression in the decade preceding World War II. The timing of the Great Depression varied across nations, but in most countries it started in about 1929 and lasted until the late 1930s or early 1940s...
of the 1930s. Fernand Collin
Fernand Collin
Fernand Collin , was a Belgian businessman. He was president of the Kredietbank from 1938 to 1973 and was also a professor at the Catholic University of Leuven....
, who became president in 1938, conceived the business strategy which would lead to the growth of the bank. He defined the Kredietbank as an independent bank with a decidedly Flemish
Flanders
Flanders is the community of the Flemings but also one of the institutions in Belgium, and a geographical region located in parts of present-day Belgium, France and the Netherlands. "Flanders" can also refer to the northern part of Belgium that contains Brussels, Bruges, Ghent and Antwerp...
character which would be an instrument to further Flemish economic growth.
During World War II
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...
, the bank would be able to expand its activities and grow its deposits from the Flemish middle class. After the war, because of the economic recovery, the Kredietbank, now the third largest bank in Belgium, was able to increase the number of operating branches in Flanders. The postwar growth strategy of the bank, emphasized foreign expansion and the development of portfolio
Portfolio (finance)
Portfolio is a financial term denoting a collection of investments held by an investment company, hedge fund, financial institution or individual.-Definition:The term portfolio refers to any collection of financial assets such as stocks, bonds and cash...
-management services for investor
Investor
An investor is a party that makes an investment into one or more categories of assets --- equity, debt securities, real estate, currency, commodity, derivatives such as put and call options, etc...
s. The bank expanded into Luxembourg
Luxembourg
Luxembourg , officially the Grand Duchy of Luxembourg , is a landlocked country in western Europe, bordered by Belgium, France, and Germany. It has two principal regions: the Oesling in the North as part of the Ardennes massif, and the Gutland in the south...
in 1949 with the Kredietbank S.A. Luxembourgeoise and into Wallonia with the establishment of the Crédit Général de Belgique in 1961.
The Kredietbank also expanded into Belgian Congo
Belgian Congo
The Belgian Congo was the formal title of present-day Democratic Republic of the Congo between King Leopold II's formal relinquishment of his personal control over the state to Belgium on 15 November 1908, and Congolese independence on 30 June 1960.-Congo Free State, 1884–1908:Until the latter...
. It established a branch in Léopoldville
Leopoldville
Leopoldville may refer to:* The capital of the Democratic Republic of the Congo, today known as Kinshasa* SS Leopoldville, a troopship sunk in 1944...
in 1952. Then in 1954 it acquired Banque Congolaise pour l’Industrie, le Commerce, et l’Agriculture and renamed it Kredietbank-Congo, Ultimately it had four branches, one each in Léopoldville
Leopoldville
Leopoldville may refer to:* The capital of the Democratic Republic of the Congo, today known as Kinshasa* SS Leopoldville, a troopship sunk in 1944...
, Bukavu
Bukavu
Bukavu is a city in eastern Democratic Republic of the Congo , lying at the extreme south-eastern extent of Lake Kivu, west of Cyangugu in Rwanda, and separated from it by the outlet of the Ruzizi River. It is the capital of the Sud-Kivu province and as of 2009 it had an estimated population of...
, Elizabethville and Stanleyville. Due the situation emerging after the independence of Belgian Congo in 1960, the bank discontinued its Congolese operations in 1966.
In the sixties, driven by increasing competition, the bank worked on the expansion of its branch network and improvement of consumer services. In 1966, the bank began building a foreign-correspondent network and the establishment of foreign branches in New York
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
, London
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
, the Cayman Islands
Cayman Islands
The Cayman Islands is a British Overseas Territory and overseas territory of the European Union located in the western Caribbean Sea. The territory comprises the three islands of Grand Cayman, Cayman Brac, and Little Cayman, located south of Cuba and northwest of Jamaica...
, and a subsidiary in Geneva
Geneva
Geneva In the national languages of Switzerland the city is known as Genf , Ginevra and Genevra is the second-most-populous city in Switzerland and is the most populous city of Romandie, the French-speaking part of Switzerland...
, the Kredietbank (Suisse) S.A.. In 1970, together with six other European institutions, Kredietbank established the Inter-Alpha Group of Banks
Inter-Alpha Group of Banks
The Inter-Alpha Group of Banks was created in 1971 by six European Community banks in order to provide a platform for the regular exchange of ideas and to explore areas for cooperation between its member banks...
.
In 1998, the Kredietbank merged with two financial institutions originating from the Boerenbond (E: Belgian Catholic Farmers Association) , ABB-insurance and CERA Bank, to form the 'KBC Bank and Insurance Holding Company'. Since then, the group has significantly expanded its activities, chiefly in Central and Eastern Europe. In 2005, KBC set another milestone by merging with its parent company, Almanij
Almanij
Almanij, meaning Algemene Maatschappij voor Nijverheidskrediet was a Belgian holding active in financial services. It is since March 2005 part of the KBC Group.-Structure:The Almanij group consisted of four companies:...
, and changing its name to KBC Group NV.
Over the past decade, KBC has built up a strong presence in many of the countries that joined the EU on 1 May 2004 (Poland, Hungary, the Czech and Slovak Republics) by investing some 7.4 billion euros in acquisitions. More recently (2007), KBC has made acquisitions in Bulgaria (DZI Insurance, DZI Invest and EIBANK), Romania (KBC Securities Romania, Romstal Leasing and INK Insurance Broker), Russia (Absolut Bank), Serbia (KBC Banka and Senzal, now KBC Securities AD Beograd, Hipobroker, now KBC Broker, and Bastion, now KBC Securities Corporate Finance) and Slovakia (Istrobanka).
Structure and main subsidiaries
KBC Group NV is the direct parent company of:- KBC Bank NV
- KBC Insurance NV
- KBC Asset Management NV
- Kredietbank SA Luxembourgeoise
- Value Source Technologies, Chennai, INDIA
All other KBC Group companies are direct or indirect subsidiaries of these.
KBC Bank NV
KBC Bank is the main subsidiary. Its first home market is Belgium, where it is one of the top three banks, with a 20-25% market share and over three million customers (counting the customers of the subsidiaries in Belgium).Its second home market is Central Europe, served via subsidiaries and investments in the Czech Republic
Czech Republic
The Czech Republic is a landlocked country in Central Europe. The country is bordered by Poland to the northeast, Slovakia to the east, Austria to the south, and Germany to the west and northwest....
(ČSOB
Ceskoslovenská obchodní banka
Československá obchodní banka, a.s. is a commercial bank which operates in Czech Republic. It is one of the largest bank domiciled in the Czech Republic. As a universal bank, it offers a full range of banking services to individuals and companies...
), Slovakia
Slovakia
The Slovak Republic is a landlocked state in Central Europe. It has a population of over five million and an area of about . Slovakia is bordered by the Czech Republic and Austria to the west, Poland to the north, Ukraine to the east and Hungary to the south...
(ČSOB), Hungary
Hungary
Hungary , officially the Republic of Hungary , is a landlocked country in Central Europe. It is situated in the Carpathian Basin and is bordered by Slovakia to the north, Ukraine and Romania to the east, Serbia and Croatia to the south, Slovenia to the southwest and Austria to the west. The...
(K&H Bank
Kereskedelmi és Hitelbank
K&H Bank or Kereskedelmi és Hitelbank is the third-biggest commercial bank in Hungary, owned by KBC Bank of Belgium.K&H Bank has total assets of EUR 4.7 billion, which leads the corporate banking market, and is the third largest retail bank....
), Poland
Poland
Poland , officially the Republic of Poland , is a country in Central Europe bordered by Germany to the west; the Czech Republic and Slovakia to the south; Ukraine, Belarus and Lithuania to the east; and the Baltic Sea and Kaliningrad Oblast, a Russian exclave, to the north...
(Kredyt Bank) and Slovenia
Slovenia
Slovenia , officially the Republic of Slovenia , is a country in Central and Southeastern Europe touching the Alps and bordering the Mediterranean. Slovenia borders Italy to the west, Croatia to the south and east, Hungary to the northeast, and Austria to the north, and also has a small portion of...
(Nova Ljubljanska Banka). With effect from July 2008, KBC Bank has acquired another small Slovakian Bank, Istrobanka
Istrobanka
Istrobanka was a universal commercial bank based in Slovakia established in September 1992.-History:Istrobanka's founding shareholder was Slovenská Poisťovňa . In 1993 the city of Bratislava, the capital city of Slovakia, became another shareholder...
. In all of these countries except Poland
Poland
Poland , officially the Republic of Poland , is a country in Central Europe bordered by Germany to the west; the Czech Republic and Slovakia to the south; Ukraine, Belarus and Lithuania to the east; and the Baltic Sea and Kaliningrad Oblast, a Russian exclave, to the north...
, KBC Bank is a top-4 player by market share.
It also has a substantial presence in Ireland
Ireland
Ireland is an island to the northwest of continental Europe. It is the third-largest island in Europe and the twentieth-largest island on Earth...
through its subsidiary KBC Bank Ireland (formerly IIB Bank), which is a major player in both the corporate and residential mortgage markets there. In all, KBC Bank has established a presence in some thirty countries around the globe.
In 2007, KBC expanded its presence to Eastern Europe through the acquisition of DZI Insurance and CIBank in Bulgaria.
KBC Project Finance
Project finance
Project finance is the long term financing of infrastructure and industrial projects based upon the projected cash flows of the project rather than the balance sheets of the project sponsors...
is a subsidiary of KBC Bank, and has been an active player in the non-recourse
Nonrecourse debt
Non-recourse debt or a non-recourse loan is a secured loan that is secured by a pledge of collateral, typically real property, but for which the borrower is not personally liable. If the borrower defaults, the lender/issuer can seize the collateral, but the lender's recovery is limited to the...
financing of projects since the early 1990s. Headquartered in Dublin, it also has professionals based in London, Brussels, New York, Hong Kong, and Sydney. Its main business lines are Energy and Infrastructure. This includes financing projects in sectors such as the oil & gas industry, power, renewable energy
Renewable energy
Renewable energy is energy which comes from natural resources such as sunlight, wind, rain, tides, and geothermal heat, which are renewable . About 16% of global final energy consumption comes from renewables, with 10% coming from traditional biomass, which is mainly used for heating, and 3.4% from...
, and Public-Private Partnership
Public-private partnership
Public–private partnership describes a government service or private business venture which is funded and operated through a partnership of government and one or more private sector companies...
. It has a portfolio in excess of US$5bn, financing approximately 250 projects worldwide.
KBC Bank also has investment banking operations in Europe, US and Asia. A specialist arm called KBC Financial Products operates primarily in global convertible bonds; its branch in Japan is called KBC Securities Japan, which specialises in secondary equity broking, convertible bond
Convertible bond
In finance, a convertible note is a type of bond that the holder can convert into shares of common stock in the issuing company or cash of equal value, at an agreed-upon price. It is a hybrid security with debt- and equity-like features...
s, warrants, and equity derivative
Equity derivative
In finance, an equity derivative is a class of derivatives whose value is at least partly derived from one or more underlying equity securities. Options and futures are by far the most common equity derivatives, however there are many other types of equity derivatives that are actively...
s.
Kredietbank SA Luxembourgeoise - European Private Bankers (KBL)
KBL is no longer a subsidiary of KBC since a sale was agreed to the Indian Hinduja Group in 2010 for a reported £1.3 Billion.In March 2011, it was announced that the deal was not completed due to the Luxembourg
Luxembourg
Luxembourg , officially the Grand Duchy of Luxembourg , is a landlocked country in western Europe, bordered by Belgium, France, and Germany. It has two principal regions: the Oesling in the North as part of the Ardennes massif, and the Gutland in the south...
financial markets regulator, Commission de Surveillance du Secteur Financier (CSSF), blocking the deal.
See also
- Paul BorghgraefPaul BorghgraefPaul Borghgraef is a Belgian businessman. He is a son of Theo Borghgraef and Suzanne Collin, who is a daughter of Fernand Collin. He is a member of the board of directors of the KBC Group....
- Luc DebaillieLuc DebaillieLuc Debaillie is a Belgian businessman.He is the Chairman and Managing Director of Voeders Debaillie, and Chairman of the Board of Directors of De Vervoersverzekeringen. He was appointed Director of Almanij in 1976 and when in 2005, Almanij merged with KBC to form the KBC Group, he became a member...
- Frank DonckFrank DonckFrank Donck is a Belgian businessman. He is a member of the business club De Warande and Director of KBC Group. He is a son of Jef Donck, who owned Comelco, which was sold to Campina.-Biography:...
- Alain TytgadtAlain TytgadtAlain Tytgadt is a Belgian businessman and a Director of the KBC Group.Alain Tytgadt obtained a degree in art history and archaeology from the University of Ghent and an MBA from Indiana University in Bloomington . He is CEO of Cobeton, and Managing Director of Metalunion, in addition he is also...
- Jozef Van WaeyenbergeJozef Van WaeyenbergeJozef Van Waeyenberge is a Belgian businessman. He is a son of Camille Van Waeyenberge and a brother of Piet Van Waeyenberge one of the founders, and currently president, of De Warande....
- Remi VermeirenRemi VermeirenRemi Vermeiren is a Belgian banker and businessman.-Education:He went to high school at the Royal Athenaeum of Dendermonde and graduated as licentiate in commercial and financial sciences at the Hoger instituut voor Handels- en Bestuurswetenschapen in Brussels .-Career:He started his career at the...
, former president - Philippe VlerickPhilippe VlerickPhilippe Vlerick , is a Belgian businessman. He was born in Kortrijk, the son of Lucien Vlerick and Thérèse Vandewiele. He is a nephew of André Vlerick and married to Patricia Bouckaert.-Career:...