KBC Irish division contributes €42m in profit to group

THE Irish division of Belgian banking group KBC contributed profits of €42 million in the first half of this year and continues to trade strongly, despite reports suggesting that the operation has been a “cause for concern” at group headquarters in Brussels.

Impairment charges for KBC’s Irish business – the monetary hit it took on so-called bad loans, or those which are unlikely to be repaid – amounted to €62m for the first six months of the year and the group’s management said as much as 86% of its Irish loan book remains in the low-to-medium risk category.

“Compared to the previous quarter, loan losses remained stable for both Belgium and for Eastern Europe. Losses on the non-domestic loan book outside Belgium and Eastern Europe rose – especially in relation to the credit exposure to the US, largely for mortgage-backed securities; the UK, mostly corporate and Ireland, primarily residential mortgages,” KBC Group chief executive, Jan Vanhevel commented.