Belgium-based KBC Bank and Austria-based Raiffeisen Bank International have agreed a deal for KBC to buy 100% of the shares of Raiffeisenbank (Bulgaria) for just over €1 billion.

The banks said the deal includes Raiffeisenbank Bulgaria's fully-owned subsidiaries Raiffeisen Leasing Bulgaria, Raiffeisen Asset Management (Bulgaria), Raiffeisen Insurance Broker and Raiffeisen Service.

KBC Group has been present in the Bulgarian financial sector since 2007 and in 2009, it defined Bulgaria as one of its core markets.

It is is present in Bulgaria through United Bulgarian Bank (UBB), DZI (Insurance), UBB Interlease, UBB Pension Insurance, UBB Asset Management, UBB Factoring, UBB Insurance Broker and KBC Branch Bulgaria.

Earlier this year, KBC acquired NN’s Bulgarian life insurance and pension fund activities.

In April, the bank announced its withdrawal from the Irish market, and said it was in talks with Bank of Ireland for its performing loans and other assets.

Johan Thijs, KBC Group CEO, said the bank has established itself as a strong local player in Bulgaria, offering a full range of banking, insurance, asset management and leasing services.

"Acquiring Raiffeisenbank (Bulgaria) is another testimony to our commitment to the Bulgarian market and support to the Bulgarian economy," he added.