KBC Bank said today that the closing of the sale of its Irish performing loan assets and liabilities to Bank of Ireland will lead to a capital relief of about €1 billion for the Belgian lender.
Last week departing lender KBC confirmed that its sale of assets to Bank Ireland was complete. The portfolios making up the deal include €7.8 billion of loans and €1.8 billion of deposits.
A small portfolio of non-performing mortgages and credit card balances were also acquired by Bank of Ireland.
Around 150,000 KBC customers will transfer to Bank of Ireland as part of the €6.4 billion deal, which was first announced two years ago.
"The deal marks a major step in KBC's orderly and phased withdrawal from the Irish market," the bank said today.
The Belgium-based bank said it plans to distribute the €1 billion, either in the form of a share buy-back - subject to ECB approval - and/or an extraordinary interim dividend.
The final decision by the Board of Directors will be taken in the first half of 2023, it added.
KBC Bank group today reported a net profit of €818m in the last quarter of 2022.
It recorded a net impairment charge on its loan book, partly due to an increase in the reserve for geopolitical and emerging risks.
"Adding the result for this quarter to the one for the first nine months of the year brings our net profit for full-year 2022 to an excellent €864m," the bank's chief executive Johan Thijs said.
Johan Thijs said that the war in Ukraine, alongside other geopolitical uncertainties, is sending shockwaves
throughout the global economy, resulting in high inflation and weighing on economic growth.
"Given those uncertainties, we have further increased our dedicated reserve for geopolitical and emerging risks, bringing it to €429m at the end of the quarter under review," he added.
