KBC Group: KBC Group: First-quarter result of -5 million euros
14 Mai 2020 - 7:00AM
KBC Group: KBC Group: First-quarter result of -5 million euros
Press Release
Outside trading hours - Regulated information*
Brussels, 14 May 2020 (07.00 a.m. CEST)
KBC Group: First-quarter result of -5 million euros
‘In the quarter under review, we were confronted
with the outbreak and spread of the coronavirus, the long-term
impact of which on the economy remains quite uncertain at this
moment in time. As an employer and service provider, we reacted
quickly to try to safeguard the health of our staff and clients,
while ensuring that services continue to be provided. As many staff
as possible are working from home and we are providing our clients
with advice through a wide range of phone and digital channels. We
have been working hard with government agencies of our core
countries to support all customers impacted by coronavirus by
processing loan deferral requests promptly, and efficiently
instituting other relief measures. We are clearly benefiting from
the efforts and investments we have made over the past few years on
the digital transformation front. These efforts and investments,
along with the expertise and motivation of our employees in all our
home countries and the strength of our multichannel distribution
network, allow us to provide our customers with a level of service
that is very close to pre-coronavirus crisis levels.
As regards our financial results, we incurred a
net loss of 5 million euros in the first quarter of 2020, caused
mainly by the impact of the worldwide coronavirus outbreak on our
trading and fair value result and the upfront booking of bank
taxes.
In the quarter under review, our trading and
fair value result came to a negative 0.4 billion euros, as a result
of a number of market-driven factors, such as sharply lower stock
markets, widening credit spreads and lower long-term interest
rates.
The impact of the coronavirus crisis on the
other profit and loss lines in the quarter under review was less
pronounced. Compared to the year-earlier quarter, our core income
lines, i.e. net interest income, net fee & commission income
and the technical insurance result, performed quite well. Costs
were kept well under control, too. They decreased slightly
year-on-year after excluding the impact of the consolidation of
ČMSS, bank taxes (the bulk of the full-year amount of these taxes
is usually recorded in the first quarter) and some one-off items.
Loan loss provisions increased in the quarter under review and
included an additional 43 million euros specifically related to the
coronavirus crisis, based on our exposure to sectors we believe
will be affected most by the crisis. For full-year 2020, we
estimate impairments to amount to roughly 1.1 billion euros (base
scenario).
Generally speaking, volumes held up well
year-on-year: on a comparable scope basis, loans and advances
increased by 6%, deposits by 5% and earned non-life insurance
premiums by 7%. On the other hand, sales of life insurance products
fell by 17% year-on-year.
Our solvency position remained very strong, with
a common equity ratio of 16.3% on a fully loaded basis, well above
the current minimum capital requirement of 8.05%. This minimum
requirement takes into account the various announced ECB and
National Banks’ measures which have provided significant temporary
relief on the minimum capital requirements. Our liquidity position
remained solid too, with an LCR of 135% and an NSFR of 134% at the
end of March 2020. We are especially pleased that the hard work in
recent years has paid off in making our group strong and healthy.
As a result, our current capital and liquidity buffers allow us to
face today's challenges with confidence.
Ultimately, our goal remains the same: to ensure
that our customers are at the centre of everything we do, something
which our employees are committed to in their day-to-day work. I
wish to express my utmost appreciation to all colleagues who have
expended huge efforts to serve our customers and support the sound
functioning of the group from home offices and other remote
locations. In closing, I would also like to take this opportunity
to explicitly thank all those stakeholders who have – in these
challenging times - continued to put their trust in us.’
Johan ThijsChief Executive Officer
Full press release attached
- 1Q2020-pb-en
- 1Q2020-quarterly-report-en
KBC Groep NV (EU:KBC)
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