KBC Group
Company presentationAutumn 2005Web site: www.kbc.com
Ticker codes: KBC BB (Bloomberg) KBKBT BR (Reuters)
2
Contact information
Investor Relations Office
Luc CoolNele KindtMarina Kanamori
Surf to www.kbc.com for the latest update.
3
This presentation is provided for informational purposes only and does not constitute an offer to sell or the solicitation of an offer to buy any security
KBC believes that this presentation is reliable, although some information may be condensed or incomplete
This presentation contains forward-looking statements with respect to our earnings development involving assumptions and uncertainties. The risk exists that these statements may not be fulfilled and that future results differ materially.
By receiving this presentation, each investor is deemed to represent that it possesses sufficient expertise to understand the risks involved
Important information
4
Table of contents
1. Company profile
2. Strategy and earnings drivers
3. 1H 2005 financial highlights
4. Information on capital management
5. Closing remarks on valuation
Company profile
Foto gebouw
1
6
Ranking in Euroland
1 BNP Paribas (35 bn) 1 BNP Paribas (43 bn) 1 BSCH (63 bn)2 BSCH (31bn) 2 BSCH (37 bn) 2 BNP Paribas (53 bn)
3 BBVA (29 bn) 3 BBVA (36 bn) 3 BBVA (47 bn)
4 Deutsche Bank (26bn) 4 Société Générale (30 bn) 4 Deutsche Bank (39 bn)
5 ABN AMRO (25 bn) 5 Deutsche Bank (30 bn) 5 Société Générale (39 bn)
6 Société Générale (24 bn) 6 Crédit Agricole (29 bn) 6 ABN AMRO (37 bn)7 Unicredito (22 bn) 7 ABN AMRO (28 bn) 7 Crédit Agricole (33 bn)
8 Fortis (22 bn) 8 Unicredit (24 bn) 8 Fortis (31 bn)9 Crédit Agricole (14bn) 9 Fortis (23 bn) 9 Unicredit (29 bn)
10 Dexia (14 bn) 10 Intesa BCO (17 bn) 10 KBC (25 bn)
11 Intesa BCI (12bn) 11 Dexia (16 bn) 11 Intesa BCI (23 bn)
12 Allied Irish Banks (12 bn) 12 KBC (15 bn) 12 Dexia (20bn)
13 Bank of Ireland (10 bn) 13 SanPaolo IMI (13 bn) 13 San Paolo IMI (18 bn)
14 KBC (9 bn) 14 Allied Irish Banks (11 bn) 14 HVB (17 bn)15 SanPaolo IMI (9 bn) 15 HVB (10 bn) 15 Allied Irish Banks (16 bn)16 Banco Popular (8 bn) 16 Commerzbank (8 bn) 16 Bank Austria (13 bn)
17 HVB (7 bn) 17 Erste Bank (8 bn) 17 Commerzbank (13bn)
18 Mediobanca (6 bn) 18 Bank Austria (8 bn) 18 Mediobanca (12 bn)
19 Bca MPS (6 bn) 19 Mediobanca (7bn) 19 Bank of Ireland (12 bn)
20 Bco Popular (5 bn) 20 Bca MPS (6 bn) 20 Bco Popular (12 bn)
Dec 2002 Aug 2004 Aug 2005
DJ Euro Stoxx Banksconstituents
Market cap ranking
7
Shareholder structure
CERA/Almancora27.1%
(own shares: 2.3%, including ESOP hedge)
Other committed shareholders 11.7%
MRBB11.6%
Free float47.3%
Staff6%
Institutional, Belgium
14%
Retail, Belgium
22%
Institutional, UK
23%
Institutional, Cont. Europe
14%
Institutional, N. America
20% Institutional, R/o world
1%
Free float
KBC is majority-owned by a group of committed shareholders, thereby providing continuity for the pursuit of long-term strategic goals
Core shareholders include the Cera/Almancora Group (co-operative investment company), a farmers’ association (MRBB) and a syndicate of industrialist families
Situation as at 31-Dec-04(before merger with Almanij)Situation as at 30-Jun-05
8
Business portfolio
KBC is a top bancassurer and asset manager in Belgium and has successfully expanded its operations in CEE-5, its 2nd home market.
Recently, Private Banking (69 bn AUM) has become more of a key focus. The PB business was expanded to include a Western European network. KBC is also active – be it rather selective – in commercial banking (mostly in W. Europe) and financial markets.
55%25%
20%
Revenue geographical breakdown(1H 2005)
Belgium:- retail bancassurance- asset management- private banking- SME/corporate
CEE:- retail bancassurance- asset management- private banking- SME/corporate
Selected other markets (mostly in W. Europe):- private banking- SME/corporate
9
Top-3 player in Belgium
Market share: 32% (1st) 19% (2nd ) 15% (3rd)
Mutual funds
Mortgages Business loans Non-life insurance
Market share: 24% (2nd) 21% (2nd) 9% (4th)
Individual Life Savings deposits
Consolidated banking landscape (80% of market held by top-4 banks)
Market highly receptive to cross-selling of AM & insurance products (the bancassurance model dominates)
10
2005 H1
25%
KBC’s presence in CEE
CEE profit contribution to KBC Group
Retail 57%
Other22%
SME/Corp 21%
Share of business segments in gross income, CEE Banking
Profit contribution, CZ + SK
2003 2004
143 m 162 m
Czech Republic
Total assets, bank: 18 bn EURMarket share, bank: 21% (No. 2)Market share, life: 8% (No. 5)Market share, non-life: 4% (No. 6)
Profit contribution, Poland
2003 2004
-295 m 25 m
Total assets, bank: 5 bn EURMarket share, bank: 5% (No. 8)Market share, life: 3% (No. 7)Market share, non-life: 11% (No. 2)
Profit contribution, Hungary
2003 2004
11 m 31 m
Total assets, bank: 7 bn EURMarket share, bank: 11% (No. 2)Market share, life: 4% (No. 7)Market share, non-life: 4% (No. 6)
Slovakia
Total assets, bank: 2 bn EURMarket share, bank: 6% (No. 4)Market share, life: 4% (No. 8)Market share, non-life: 2% (No. 7)
Profit contribution, Slovenia
2003 2004
10 m 26 m
Minority stake (34%)Market share, bank: 41% (No. 1)Market share, life: 6% (No. 5)
11
KBC’s presence in CEE
0% 20% 40% 60% 80% 100%
PL
CZ
SK
SLO
HU
0 200 400 600 800 1000
PL
CZ
SK
SLO
HU
towns with KBC branch
No. of towns
Percent of towns with KBC branch Density of KBC’s branch network
KBC Group is one of the largest international players in the region
The density of KBC’s branch network is amongst the highest in the CEE region
Unlike the other players, KBC limits its presence to the EU Member States (Czech Republic, Slovakia, Hungary, Poland and Slovenia) and is active in both the banking and insurance fields
12
KBC’s commercial banking network
•
•
•
• •
• • • •
•
• • •
Credit exposure
Belgium 61 bnCEE 21 bnWestern-Euope 32 bnRest of the world 8 bnTOTAL 122 bn
13
KBC’s private banking network
AUMBelgium 24 bnCEE 3 bnLuxemburg
Switzerland 18 bnMonaco
Spain * 12 bnGermany 5 bnNetherlands 3 bnUnited Kingdom 3 bnFrance 1 bnItaly 0.4 bnTotal 69 bn * Of which 7 bn in low-yielding assets•
• • • •
•
•
• •
•
•
• •
•
14
12% 14%20%
FY03 FY04 1H05
66% 65%
57%
FY03 FY04 1H05
Cost/income, banking
Solid financial track record
96%95%
94%
FY03 FY04 1H05
Combined ratio, non-life
In m EUR
Return on equity
1 305 1 6151 253
FY03 FY04 1H05
Net profit growth
In m EUR
Pro forma figures, KBC Group (2003 figures are according to B-GAAP)
Strategy and earnings drivers
Foto gebouw
2
16
Start of a new decade
In Q1 2005, KBC merged with parent company Almanij:
‘Quick wins’ for shareholders included:• The re-rating of the KBC share due to increased transparency, visibility and share liquidity
(analysts previously used a 10-15% discount)• Operational synergies, particularly in the field of wealth management
(programme of 75 m recurring pre-tax result, of which ½ as from 2006)
Further value-creating potential includes:• Shifting the earnings trend in the private banking area ‘into much higher gear’
(earnings growth to be doubled from 5% to at least 10% CAGR)
Moreover, KBC continues to be ambitious, maintaining its performance commitments in both Belgium and CEE
17
We build a solid future
Strategy headlines include: Retail- and wealth-management-oriented, with focus on Belgium and CEE-5 and selected
Western European markets Further enhancement of efficiency (with emphasis on - but not exclusively in - CEE and European
private banking) Standalone basis (opportunistic operational alliances in certain areas to generate economies of
scale, if needed) Steady dividend growth and solid level of financial strength/solvency
The solid ‘growth and value’ outlook is reflected in ambitious financial targets, valid until 2008:
Efficiency: Cost/income, banking
Combined ratio, non-life
max. 58%
max. 95%
Financial strength: Tier-1, banking
Solvency margin, insurance
min. 8%
min. 200%
Value creation: Adjusted ROE
EPS growth (CAGR)
min. 16%
min. 10%
18
Do not underestimate the market: KBC Group is well positioned:
Consolidated banking market (80% of assets held by top-4 players)
Savings ratio amongst highest in the world (every year, ca. 15% of GDP flows into fin. assets)
Market highly receptive to cross-selling of AM & insurance, fueling strong growth trend in AM and life insurance business
Strong mortgage growth trend (ca. 10% per year) expected to continue, as residential property price levels are still below other European markets
Fee rates for retail banking services only 50% of European average (gradual increase expected)
Credit quality has proven to be solid over the cycle
Top-3 market position, esp. strong in Northern region (one of the wealthiest regions in the EU)
Of the top players, level of customer satisfaction is highest
Innovative product offering in retail AM (steadily increasing market share over the past 10 yrs.)
Still high cross-selling potential for non-life products and well-performing bancassurance distribution model
Further cost efficiency improvement potential, among other things, via co-sourcing of back offices with other banks
Well-diversified revenue structure (50% fee income) and further increase in fee income targeted
Earnings drivers in Belgium - overview
19
Strong market growth momentum: KBC Group is well positioned:
Earning drivers in CEE - overview
Nom. GDP growth in 2005/06 at 6.3%. Although prospects have been revised due to global economic slowdown, growth will still outgrow EMU by 3.1%
Ongoing catch-up in product penetration (currently, an avg. of 45% for banking accounts and 5% for mortgages)
Mortgage volumes growing at double-digit pace (up 51% on avg. in 2004)
Financial sector could grow five-fold if financial assets to GDP were to reach current levels of S. Europe
Solid market position in retail and corporate businesses (excl. banking in Poland) with nationwide branch networks
Competitive advantage in enhancing cross-selling of asset management and insurance products
Well positioned in HNWI and private banking through epb know-how
C/I still on the high side overall, inducing further improvement, e.g., by setting up cross-border platforms for processing transactions
Adequately provisioned balance sheet (risks under control)
Availability of capital within the Group
20
Strong growth fundamentals in CEE
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
1.0 1.5 2.0 2.5 3.0 3.5 4.0
Germany
SwitzerlandItaly
Denmark
UKSweden
EMU
BelgiumFrance
The Netherlands
Portugal
US
Spain Finland
Ireland (9,4;5,0)
High flyers
Average real GDP growth, 1997-2001 (in %)
Ave
rag
e r
ea
l GD
P g
row
t h, 2
002-
20
04 (
in %
)
Czech Rep.
Slovakia
Slovenia
Poland
HungaryEU-13
(not-EMU)
Turkey (1,2; 7,5)
(Source: IMF)
0% 1% 2% 3% 4% 5% 6% 7% 8% 9%
Belgium
EU-15
US
Poland
Hungary
Czech Republic
Slovakia
Slovenia
Financial services (banking & insurance) in % of GDP (2004)
(Source: Vienna Institute for International Economic Studies)
21
Bancassurance fueling CEE earnings
Cross-sell rates2004
CZ HU PL SK BE
Consumer loan
XLife
83% 50% 100% 94% 67%
Mortgage loan
XLife
45% 50% 100% 75% 67%
Mortgage loan
XProperty
insurance
54% 71% 42% 30% 50%
Now the model is in place:
Transfer of product know-how and streamlining of business processes and IT systems
Implementation of KBC’s distribution model and setting up of sales incentives and adequate sales approach
Unified management responsibility (joint management committee of bank and insurance)
= competitive advantage relative to other CEE players
Results are encouraging:
22
Growth in AM fueling CEE earnings
KBC is well positioned:
Strong appetite for ‘risk-free’ investments in the market (money-market, capital-guaranteed funds), fully in line with KBC’s core competencies and successful track record in Belgium
Cost/AUM below average (around 16 bps vs. 20 bps for Europe)
= competitive advantage relative to other CEE players
Results are encouraging:
AUM grew in ’04 by 25%. Continued high growth expected in coming years (CAGR of 15-20% in mutual funds and 10-15% in pension products)
Via the funds business, new customers are recruited. Existing customers using deposits to buy funds replenish deposit accounts after one year
Market share
2003 2004 1H05 Trend
CZ 19% 22% 26% +++
HU 8% 9% 11% ++
SK 6% 7% 8% +
SLO - 8% 10% ++
PL 3% 4% 4% +
23
Centralized processes reducing costs
Example 1: card transactions
Centralized purchasing & processing of: 7.5 million cards 500 million transactions
Reduced costs driven by: Standardized technology anticipating future
developments (SEPA) Economies of scale
Example 2: cross-border payments
Centralized processing of cross-border transactions (also open for third-parties)
Reduced costs driven by: Standardized technology anticipating future
developments (SEPA) Economies of scale
0.00 €
0.02 €
0.04 €
0.06 €
0.08 €
0.10 €
0.12 €
- 500 1 000 1 500 2 000 2 500
cost/trans.
million transactions
Open for other
parties
Incl. KBC CEE
Incl. DZ Bank
Group
Standalone
Volume of transactions
Pro
ce
ss
ing
co
sts
100
80
90
24
Mid-term financial outlook, CEE
RWA CAGR
Net profit CAGR
Loan-loss ratio
Cost/Incomeratio
Banking 10% – 15% 10% – 15% < 0.50% < 60%
Premium income CAGR
Net profit CAGR
Combined ratio
Insurance 15% – 25% 25% - 35% 95%
25
Private banking in higher gear
Dual brand strategy: network-led vs. ‘independent boutique’
Growth drivers: network trade-up, extension of product offer and hiring of private bankers
Core business: an integrated private banking business in selected European markets focusing on clients with >€1m of investable assets
Integrated network of local pure-play private banking brands (boutique style)
Priority of reducing costs by creating synergies in a central ‘hub’ (IT, operations, support)
Growth drivers: increased share of wallet, hiring of PB managers and opportunistic M&A
Low-growth market
Focus on profitability (leveraging the hub)
If possible, steer repatriated assets to KBC onshore
No expansion, except in IFAs with short payback
Small today (2 bn AUM), but high market growth expected (>15% p.a.)
Strengthening a network-led model, leveraging Belgian experience
Belgium W. Europe onshore W. Europe offshore CEE
Opportunistic acquisitions may imply investments of 150-250 m per year
26
Shift in customer preference towards greater sophistication: open architecture, alternative investments, financial planning, accessibility and Internet delivery
However, the core needs of customers will remain the same (trusted personal relationships, status/exclusivity, investment performance)
Strong relationship-based approach, open architecture concept, KBC AM’s sound product expertise and solid capability for tailor-made solutions
Greatly improved efficiency (implementation of large scale rationalization programme), to be further boosted by the realization of merger synergies within the enlarged KBC Group
Leveraging the network in Belgium Local private banking brands with status/heritage in
Germany, Spain, Netherlands, UK and Belgium ‘Unique’ model attracting experienced private bankers
from big banks
Changing market environment: KBC Group is well positioned:
Private banking in higher gear
27
0
20
40
60
80
By Area By Type
Type of benefits*
€m
Revenue(40%)
Cost (60%)
ICT & Overheads
Asset Managemen
t
Insurance
Corporate
Fin. Markets
Securities
Payments
16.7
12.6
27.7
74.6
12.6
3.9 1.0
0
10
20
30
40
50
60
70
80
Cross sales
Newbusiness
Optimi-zation
Pro-cure-ment
People
Source of benefits*€m
* Synergy benefits defined as peak recurring annual increase in pre-tax bottom-line result (2009 - peak level)
Costsavoided
Total
Securities
The merger of KBC and Almanij allows to realise synergies by reducing costs and cross selling.The total benefit amounts to 75 m euro (pre-tax) per year as of 2009 (50% to be realised as of 2006).
Operational synergies in private banking
28
In total, KBC Group projects ~10% net income growth per year until 2008
KBC Group Forecasts
2004 2008 Forecasts
AUA (€bn) KBL EPB 44
KBC PB 14
Total 58 83
2004 2008 Forecasts
Net Income (€bn)
KBL EPB 205
KBC PB 50
Total 255 380
Cost Income Ratio 67% 55%
AUA Growth
Belgium CAGR 14%
Onshore W. Europe CAGR 10%
Offshore W. Europe CAGR 0%
CEE CAGR 15%
Total AUA Growth CAGR 9%
0
50
100
150
200
250
300
350
400
2004 2008
Net Income Growth
This assumes normal market conditions
Excluding any future acquisitions
CAGR 10%
Private banking, financial projections
1H 2005Financial highlights
Foto gebouw
3
Foto gebouw
Financial highlights
- At a glance
- Group financial performance
- Headlines per segment
FY 2005 profit outlook
31
1. Net profit at 1 253 m, up 55% y/y, generating a return on equity of 20%
2. Underlying profit (excl. one-offs) growing at 34%
3. Comparison of individual P/L lines with pro forma 2004 figures distorted by application of IFRS 32/39 and IFRS 4 as of 2005
4. Strong business volume growth (deposits / loans / AUM / insurance) generating strong commission income (+23%) and offsetting impact of flattening yield curve on net interest income
5. AUM reaching the 170 bn EUR level (o/w 69 bn in private banking)
6. Further downtrend in expenses - cost/income ratio (banking) at 57 %
7. Sustained low combined ratio, non-life (94%)
8. Very low credit-risk provisioning (loan-loss ratio at 0.06%)
9. High levels of return in most business segments, especially in Belgian retail (29%) and in CEE (54%)
10. Outlook for 2005 remains positive
1H 2005 at a glance
32
Solid business growth
Note: Growth trend, excl. (reverse) repo activity, from 31-Dec-04 to 30-Jun-05
Growth, Ytd +7% +10% +7% +11% +11%
Belgium +7% +8% +5% +10% +15%
CEE +3% +16% +15% +15% +20%
Rest of world +7% +15% +7% - +5%
30 June 2005Customer
loans o/w
mortgagesCustomer deposits(banking)
Life ‘deposits’
(insurance)
AUM(asset
management)
Outstanding 108.7 bn 30.7 bn 167.8 bn 14.9 bn 170.5 bn
33
Profit trend, 1H 05
1H 2004pro forma
1H 2005 1H/1H 1H/1Hexcl.
one-offs
Gross income, net of technical insur. charges
3 919 4 163 +6% +2%
Expenses -2 373 -2 313 -3% -6%
Operating result 1 545 1 850 +20% +15%
Impairments -242 -57 -76% -76%
Associated companies -39 +33 - -27%
Net profit 810 1 253 +55% +34%
C/I, bankingCR, non-lifeROE
61%93%14%
57%94%20%
Notes:1) One-offs include the disinvestment loss at Agfa Gevaert (net bottom-line impact of –80 m) in Q2 2004, the write-back of of provisions for
operating expenses after a legal settlement (net +48m) in Q2 2004, the income related to the settlement of a ‘historic’ Slovakian loan (net +68 m) in Q1 2005, the ‘non-recurring’ value gains on shares of Irish insurer FBD (net +68m) in Q1 2005 and merger-related expenses (net 13m) in Q2 2005
2) All 2004 figures exclude impact of IAS 32/39 and IFRS 4
34
Profit trend, Q2 05
2Q 04 1Q 05 2Q 05 2Q/2Q 2Q/1Q
Gross income, net of tech. charges 1 917 2 127 2 035
Expenses -1 105 -1 104 -1 209
Operating result 812 1 024 826 +2% -19%
Operating result, underlying 739 851 846 +15% -1%
Impairments -90 -15 -42
Associated companies -60 +21 +13
Net profit 434 717 536 +24% -25%
Net profit, underlying 465 581 550 +18% -5%
Notes:1) One-offs include the disinvestment loss at Agfa Gevaert (net bottom-line impact of -80m) in Q2 2004, the write-back of of provisions for
operating expenses after a legal settlement (net +48m) in Q2 2004, the income related to the settlement of a ‘historic’ Slovakian loan (net +68 m) in Q1 2005, the ‘non-recurring’ value gains on shares of Irish insurer FBD (net +68m) in Q1 2005 and merger-related expenses (net 13m) in Q2 2005
2) All 2004 figures exclude impact of IAS 32/39 and IFRS 4
Foto gebouw
Financial highlights
- At a glance
- Group financial performance
- Financial headlines per segment
FY 2005 profit outlook
36
Solid revenue trend
Gross income (in m), per half year
6 353 5 980 5 660
1H04 2H04 1H05 2H05
Gross income (in m), per quarter
3 175 3 1782 517
3 4622 756 2 904
1Q04 2Q04 3Q04 4Q04 1Q05 2Q05
IFRS reclassfications distort comparison with 2004 (among other things, non-recognition of unit-linked insurance premiums)
Q1’s solid trends continued in Q2: NII: volume growth almost offsetting q/q
NIM contraction High level of life insurance premium income
(1.2 bn - mostly unit-linked, in line with stock market performance)
Strong commission line (410 m)
Down 693 m y/y, mainly due to non-recognition of 1.1 bn new unit-linked premium volume under IFRS 2005
Apart from one-offs (136 m in Q1), solid revenue ‘quality’: NII: volume growth almost offsetting negative impact
on NIM from flattening yield curve (-13 bps) High level of life insurance premium income (2 bn) Strong commission line (+23%)
37
NII trend, banking activities
Belgium 1.96%E x c l. IF R S 05 : sta b le
CEE 2.94%E x c l. IF R S 0 5 : - 4 0 b ps
Other(o /w e p b 0 .55 % ,
s ta b le e xc l. IFR S )
NIM 1.63%In c l. IF R S 0 5 : sta b le
E x c l. IF R S 0 5 : -1 3 b ps
Belgium+ 8%
CEE+ 1 7%
Other(o /w ep b -1 4% )
Avg. volumein te re st-be a rin g a ss e ts
+ 6%
N II 1 886mIn c l. IF R S 0 5 : + 6%E x c l. IF R S 0 5 : -3%
1H 05 (y/y trend)
38
Impact of IFRS on NII / FV income
1H 04 1H 05 %
NII 1 961 2 122 +8%
FV income 415 225 -46%
Total 2 376 2 348 -1%
1H 04 1H 05 %
NII 1 961 1 947 -1%
FV income 415 470 +13%
Total 2 376 2 417 +2%
1H 05 IFRS, as reported
1H 05, adjusted for comparison *
Main impact from IFRS:
Reclassification of interest income on hedging derivatives from NIM to FV income ( 175m)
Negative impact of FV adjustments on financial instruments (-70m)
* Remark: simplified - only the mentioned main IFRS-adjustments are used
39
Impact of IFRS on Life income
1H 05 IFRS, as reported
1H 05, adjusted for comparison
1H 04 1H 05 %
Premium income, life 1 910 892 -53%
Fees, investments w/o DPF - 32 -
Technical charges, life -1 945 -983 -49%
Financial income 160 259 +62%
Total 123 197 +61%
1H 04 1H 05 %
Premium income, life 1 910 1 963 +3%
Fees, investments w/o DPF - - -
Technical charges, life -1 945 -2 025 +4%
Financial income 160 259 +62%
Total 123 197 +61%
No recognition of premium income and technical charges of investments contracts without Discretionary Participationt Feature (mostly unit-linked life products)
Margin recognized as fee/commission income
Remark: no bottom-line impact !
40
Competitive landscape in Belgium
In 1H 05, NIM was stable y/y at 2.0 %.
In Q4 04 and Q1 05 the (obviously lagging) effect of the flattening of the yield curve was offset by the improved product mix (shift to low-yielding liquid savings deposits in anticipation of an interest rate hike). In Q2 05, customers switched to long-term investments, anticipating deposit rate cuts (-25 bps as of Q3 03).
Volume growth (deposits/loans) was strong in Belgium, further boosting NII
Since mid-2004, credit spreads have seen a significant deterioriation as a result of increased price competition. Currently, pricing rationality is tending to be restored.
2.0%1.9% 2.0%
2.0% 2.0%
1.9%
2.1% 2.1% 2.1%
1.7%
1.6%
1.3%
1Q04 2Q04 3Q04 4Q04 1Q05 2Q05
Interest margin, BelgiumSpread 3m-10y treasury
Net Interest Margin, KBC Bank, Belgium Spreads on new mortgages (bps), KBC, Belgium
Jan
-04
Mar-
04
May-0
4
Ju
l-04
Sep
-04
No
v-0
4
Jan
-05
Mar-
05
May-0
5
Ju
l-05
0.88
0.76
0.41
0.48
41
Competitive landscape in Belgium
0.0% -0.1%0.1%0.0%0.0%
0.9% 1.0%
-1.1%-0.9%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4Q03 1Q04 2Q04 3Q04 4Q04 1Q05 2Q05
KBC
Other large banks
Small retail banks
Change in retail market share since the beginning of 2004 (avg. deposits and loans), proxy
Source: Febelfin (market sample)Includes consumer loans, mortgages, saving accounts and saving certificates
In 2004, the large banks, representing >80% of the market, lost roughly 1% market share to the benefit of smaller players. But from 1H05, this trend seems to be on the wane.
KBC has been able to keep its market share stable (and may have further increased its market share in unit-linked insurance and probably mutual funds).
42
Sustained favourable y/y cost trend
Operating expenses (in m), per half year
2 373 2 571 2 313
1H04 2H04 1H05 2H05
Operating expenses (in m), per quarter
1 269 1 105 1 1471 424
1 104 1 209
1Q04 2Q04 3Q04 4Q04 1Q05 2Q05
Ytd expenses down 3%, mainly driven by (a) cost cutting in Belgium and (b) lower staff profit-sharing bonuses (esp. at KBC Financial Producs)
Cost/income, banking, down from 61% to 57%
As expected, cost level up q/q due to: Elimination in Q2 of underusage of IT and
marketing budgets of ca. 20m in Q1 (time lag)
Higher income-related staff costs ( 27 m esp. at KBC Financial Products)
Restructuring costs (20 m) and one-off merger-related costs (20 m)
Y/y trend: Q2 04 includes write-back (73 m) of provision for operating charges (after legal settlement)
-3%
43
Historic low impairment level
Impairment charges (in m), per half year
242
12357
1H04 2H04 1H05 2H05
Impairment charges (in m), per quarter
152
90
4479
1542
1Q04 2Q04 3Q04 4Q04 1Q05 2Q05
Impairments down 185 m (-76%) on the back of limited credit risk and solid equity markets
Loan-loss ratio down from 0.20% in FY 04 to 0.06%
Impairments on investments limited to 16 m versus 130 m in 1H 04
-76%
LLR Avg loans FY 04 1H 05
Belgium 58.3 0.09% 0.03%
CZ/Slovakia 10.7 0.26% 0.00%Hungary 5.4 0.64% 0.93%
Poland 3.9 0.69% 0.00%International 40.2 0.26% 0.09%
Total 118.5 0.20% 0.06%
Q2 impairments remain at historic low
Q2 includes 5 m impairment on goodwill at KBL France
44
Excellent underwriting result, non-life
Combined ratio
105%96% 95% 94%
2002 2003 2004 1H05
Combined ratio, year-to-date
97% 93% 94% 95% 92% 94%
3M04 6M04 9M04 12M04 3M05 6M05
Combined ratio at 94% on the back of Sound risk management (claims ratio at 64%) Good cost control (expense ratio at 30%)
Favourable claims environment on all markets
Q2 sligthly higher q/q, mainly for seasonality reasons
C/R FY03 FY04 1H05
Belgium 93% 92% 93%
Czech Rep. 102% 99% 93%Slovakia 146% 138% 116%
Hungary 103% 98% 86%
Poland - 95% 97%
R/I 100% 98% 90%
Total 96% 95% 94%
Foto gebouw
Financial highlights
- At a glance
- Group financial performance
- Financial headlines per segment
FY 2005 profit outlook
46
Segment structure
KBC Group NV
KBCInsurance
KBCAM KBL epb GevaertKBC
Bank
Primary segmentation by business segment
47
Banking: Q2 05 result at 314 m:
Good top-line mix, commissions particularly strong, not boosted by gains and trading income, NII almost stable despite flatening yield curve
Higher costs after the very low Q1 level (see above) Impact of one-offs in y/y and q/q comparison (see below)
1H 05 profit at record level of 784 m, driven by: Strong commission income (+21%) Strict cost control (C/I at 57% incl. AM) Limited credit cost (0.06 bp) One-off income related to settlement of historic
Slovakian loan (net 68 m)
Insurance: Q2 05 results in line with Q1 (though high gains in Q1), due to
Record level of sales of life products (1.2 bn) High dividend income (86 m) Slightly better claims result
1H 05 results increasing to 246 m on the back of: High sales of life insurance (2 bn euro) Excellent underwriting performance (CR, non-life, 94%) Higher investment income o/w capital gains (esp. FBD –
net non-recurring impact: 68 m) Low impairment charges on portfolios (extremely high in
1Q 04)
Key points, business segments
332246
470
367
318
314
0
100
200
300
400
500
600
700
800
900
1H04 2H04 1H05 2H05
Pro forma IFRS 2004 IFRS 2005
BANKINGNet profit (in m)
699
564
784
-55
30
122
58
89
124
-70
-20
30
80
130
180
230
280
1H04 2H04 1H05 2H05
Pro forma IFRS 2004 IFRS 2005
INSURANCE
Net profit (in m)
3
119
246
1Q04
2Q04
3Q04
4Q04
1Q04
2Q04
1Q05
2Q05
1Q05
2Q05
4Q04
3Q04
48
Profit trend, banking segment
Segment banking 2Q 04 1Q 05 2Q 05 2Q/2Q as
stated
2Q/2Qexcl.
one-offs
2Q/1Q as
stated
2Q/1Qexcl.
one-offs
Gross income 1 400 1 513 1 373 -2% -2% -9% -3%
Expenses -816 -807 -878 +8% -1% +9% +9%
Operating result 585 706 495 -15% -3% -30% -18%
Net profit 367 470 314 -14% -2% -33% -22%
Net profit, underlying 319 402 314 -2% -22%
Notes:1) One-offs include the write-back of of provisions for operating expenses after a legal settlement (net +48m) in Q2 2004 and the income
related to the settlement of a ‘historic’ Slovakian loan (net +68 m) in Q1 20052) All 2004 figures exclude impact of IAS 32/39 and IFRS 4
Impact of one-off items:
49
Key points, business segments
Asset management: AUM in 1H 05 up 16% to 97 bn (2/3 due to new money
inflows) 1H 05 profit contribution at 126 m, +16 m y/y (driven by
increased AUM) Note: total AUM within the Group: 170 bn
Asset management segment: 82 bn (3rd party) + 15 bn (group assets)
Banking segment: 24 bn (mostly private and HNWI assets in Belgium and CEE)
European private banking segment: 50 bn (o/w 46 bn of private banking customers)
European private banking: 1H 05 profit contribution at 94 m, up 28 m y/y and down
12 m q/q (due to restructuring provisions) Top-line at high level (partly due to M2M of financial
instruments) with sustained growth trend of commission income
Private banking AUM in 1H 05 up 8% to 50 bn Cost/income at 67% No relevant impairment charges
43 3853
23
-30
41
Pro forma IFRS 2004 IFRS 2005
Net profit (in m)
51 53 58
58 66 68
0
20
40
60
80
100
120
140
160
180
1H04 2H04 1H05 2H05
Pro forma IFRS 2004 IFRS 2005
Net profit (in m)
EUROPEAN PRIVATE BANKING
ASSET MANAGEMENT
66
8
94
109 119 126
3Q04
4Q04
1Q05
2Q05
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
1Q04
2Q04
50
17 1232
-65
85 31
1H04 2H04 1H05 2H05
Pro forma IFRS2004
Key points, business segments
-12 -18-7
-27
-41
-131H04 2H04 1H05 2H05
Pro forma IFRS 2004 IFRS 2005
Net profit (in m)
IFRS 2005
Net profit (in m)
HOLDING COMPANY
GEVAERT Gevaert: 1H 05 profit contribution of 63 m (remember that in 2Q 04,
discontinued activities weighed on the P/L at –80 m) Revenue shored up, among other things, by M2M
according to IFRS standards of private equity portfolio in 1Q 05 (15 m) and by gains on disposal of listed equity holdings in 2Q 05 (30 m)
1H 05 profit contribution from Agfa-Gevaert: 14 m
Holding company: 1H 05 net holding company results at -59 m, quite high
due to: One-off costs in Q2, related to Almanij-KBC merger
(20m): expenses for existing stock option plan at KBL and external advisory services
Elimination of received dividends on own shares (IFRS 2005) (9 m)
Costs of debt related to minority buy-out of KBL Debt funding will be gradually reduced in future
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
-48
36
63
-19 -40 -59
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
51
Segment structure – cont’d.
KBC Group NV
KBCInsurance
KBCAM KBL epb GevaertKBC
Bank
CEE
Markets
European private banking
Gevaert
Retail
Business customers
1
2
1 . Primary segmentation by business segment2. Additional breakdown by area of activity
52
Retail Belgium and CEE
66 75
19198 51
121
1H04 2H04 1H05 2H05
Pro forma
Net profit (in m)
87 132
295132
303
244
1H04 2H04 1H05 2H05Pro forma
Net profit (in m)
CEE
RETAIL BELGIUM Retail Belgium: Q2 somewhat lower q/q due to lower banking revenue
(partly seasonal) and higher taxes (less exempted gains) 1H 05 net profit of 539 m, 320 m more than 1H 04:
sound revenue growth (esp. related to savings/investments and mortgages)
sustained cost discipline (-4%) strong non-life underwriting performance absence of credit provisioning and normalization of
value impairments on the investment portfolio (impairments 148 m)
‘Private banking’ sub-segment contributes 32m in 1H 05 1H 05 ROAC at 29% (pro forma FY 04: 22%)
CEE: Q2 on same (high) level as Q1 (except 68 m one-off in Q1) 1H 05 profit contribution of 312 m - ROAC at 54% (pro
forma FY04: 27%) In CZ/Slovakia: 1H 05 profit contribution of 219 m (incl.
one-off of 68 m in Q1). The negative effect of lower interest rates is compensated by higher volumes. Sound growth of insurance business.
Hungary: further positive trend of operating results, but somewhat higher loan-loss provisions (LLR 0.93%, similar to that of major peer). 1H 05 profit at 20 m.
Poland: 1H 05 profit contribution of 62 m, (incl. deferred taxes of 9 m in Q2) due to sound cost trend, growing insurance business and absence of loan losses)
219
435
539
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
164126
312
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
53
SME and wholesale activities
SME/corporate: Strong profitability trend of 2004 continues as a result of:
Low credit provisions (LLR 1H 05: 0.21%) High cost efficiency (C/I 36%) Solid technical result from reinsurance (C/R 90%)
2nd quarter profit level slightly lower than average of previous quarters due to lower revenue and higher taxes
1H 05 ROAC at 20% (pro forma FY04: 19%)
Capital markets: 2Q 05 profit contribution continues to be at level registered
in previous quarter, but below record high of 1H 04 (when exceptionally fine results were booked in derivatives)
1H 05 earnings amounts to 106 m (-23% y/y). Income from convertibles & equity derivatives trading was particular weak. Equity brokerage and structured credit business brought about a result improvement.
1H 05 ROAC at 28% (pro forma FY 04: 34%)
68
1953
70
76
53
1H04 2H04 1H05 2H05
Pro forma
Net profit (in m)
108 99 125
118105
101
1H04 2H04 1H05 2H05
Pro forma
Net profit (in m)
CAPITAL MARKETS
SME/CORPORATE
226204
225
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
137
96 106
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
Foto gebouw
Financial highlights
- At a glance
- Group financial performance
- Financial headlines per segment
FY 2005 profit outlook
55
2005 profit outlook
KBC continues to be positive on its strategy in the various business lines
Banking costs are expected to decrease in 2005
There are no signs of any substantial decline in credit quality or in underwriting performance, non-life
The interest rate and stock market environments remain factors of uncertainty
KBC has already set a mid-term objective of >10% CAGR EPS growth
On the basis of the solid 1H 05 earnings and the prevailing view regarding the relevant economic and financial parameters, KBC’s 2005 net profit is expected to exceed the10% growth level, amounting to more than 2 bn euros
Foto gebouw
Financial highlights
- At a glance
- Group financial performance
- Financial headlines per segment
FY 2005 profit outlook
Additional information
57
Solid business growth
Growth, 2Q 05 +3% +6% +3% +7% +4%
Belgium +4% +4% +2% +7% +5%
CEE - CZ/Slovakia - Hungary - Poland
+4%+5%+3%+0%
+9%+8%
+12%+5%
+5%+6%+6%-5%
+8%+3%
+27%+16%
+12%+10%+24%+12%
Rest of the world +1% +9% +4% - +0%
Note: growth trend excl. (reverse) repo activity
Growth, Ytd +7% +10% +7% +11% +11%
Belgium +7% +8% +5% +10% +15%
CEE - CZ/Slovakia - Hungary - Poland
+3%+6%+4%-4%
+16%+15%+22%+7%
+15%+21%+10%-3%
+15%+12%+46%+8%
+20%+22%+68%-4%
Rest of the world +7% +15% +7% - +5%
Customer loans
o/w mortgages
Customer deposits
‘Life deposits’
AUM(off-balance)
Outstanding (in bn) 108.7 30.7 167.8 14.9 170.5
58
Group income statement, 1H 2005
(in m euros) Banking Insurance AM KBL epb Gevaert Holding Group
Net interest incomeGross earned premium, insuranceDividend incomeNet gains from FI at FV Net realised gains from AFS assetsNet fee and commission incomeOther income
1 8070
67121
63605223
2661 707
864
144-148
29
-10781
1841
7907
8221
20633
-203
1437
049
-3000
-40
-2235
2 1221 707
169225265839330
Gross income 2 887 2 088 199 429 101 200 5 660
Operating expensesImpairments - o/w on loans and receivables - o/w on AFS assetsGross technical charges, insuranceCeded reinsurance resultShare in results, associated companies
-1 685-34-34
100
17
-254-20
-1-18
- 1464-33
0
-30000000
-287-501002
-4211100
15
-257000000
-2 313-57-34-16
-1 464-3333
Profit before taxes 1 185 316 169 137 75 -57 1 826
Income tax expense
Minority interests
-306-96
-66-4
-430
-39-4
-12-1
-20
-469-104
Net profit 784 246 126 94 63 -59 1 253
Excl. intrasegment eliminations
59
Areas of activity overview, 1H 2005
(in m euros) Retail CEE SME/Corp.
Markets KBL epb Gevaert Total
Banking and AM
Gross incomeOperating expensesImpairmentsIncome tax expenseMinority interestsNet profit – group share
1 288-734
+7-178
0383
925-526
-7-71-41282
508-183
-34-84
0208
410-235
-2-67
0106
429-289
-5-39
-494
3 515-2 004
-39-415-100
1 003
Insurance
Gross income (- techn. ch.)Operating expensesImpairmentsIncome tax expenseMinority interestsNet profit – group share
373-156
-15-46
-1155
131-83
-1-10
-730
47-15
-4-10
017
591-254
-20-66
-4246
Holding Co
Net profit – group share 63 3
Group total
Net profit – Group shareShare in group resultROAC
53943%29%
31225%54%
22518%20%
1068%
28%
948%
16%
635%
11%
1 253
20%
Excl. non-allocated results
60
Group income statement, 2Q 2005
(in m euros) Banking Insurance AM KBLepb Gevaert Holding Group
Net interest incomeGross earned premium, insuranceDividend incomeNet gains from FI at FV Net realised gains from AFS assetsNet fee and commission incomeOther income
9100
4951
6284
74
136978
769
38-6710
-10440
961
4105
3819
1069
002
-634
026
-1400
-300
130
1 074978135
9297
410118
Gross income 1 373 1 180 105 217 56 112 2 904
Operating expensesImpairments - o/w on loans and receivables - o/w on AFS assetsGross technical charges, insuranceCeded reinsurance resultShare in results, associated comp.
-878-36-38
2006
-131-40
-4-852
-170
-15000000
-153-4-11001
-22211006
-149000000
-1 209-42-38
0-852
-1713
Profit before taxes 465 176 90 60 42 -37 797
Income tax expense
Minority interests
-109-42
-48-4
-220
-18-1
-110
-40
-212-48
Net profit 314 124 68 41 31 -41 536
61
Areas of activity overview, 2Q 2005
(in m euros) Retail CEE SME/Corp.
Markets KBLepb Gevaert Total
Banking and AM (incl. KBL)
Gross incomeOperating expensesImparimentsIncome tax expenseMinority interestsNet profit – group share
629-363
-6-91
0170
403-273
-2-11-16101
250-89-21-45
095
235-142
-2-38
053
218-155
-4-18
-141
1 696- 1 048
-40-149
-42422
Insurance
Gross income - tecbn. ch.
Operating expensesImpairmentsIncome tax expenseMinority interestsNet profit – group share
159-82
-3-35
074
70-42
0-4-419
22-70
-806
313-131
-4-48
-4124
Holding Co
Net profit – group share 31 -10
Group total
Net profit – Group share 244 121 101 53 41 31 536
Excl. non-allocated results
62
Group earnings, quarter by quarter
(in m euros) 1Q04 2Q04 3Q04 4Q04 1Q05 2Q05
Net interest incomeGross earned premium, insuranceDividend incomeNet gains from FI at FV Net realised gains from AFS assetsNet fee and commission incomeOther income
9951 275
25224193357106
9661 404
121191
60324113
910901
39123
93323128
9631 577
46187157399132
1 048729
34133168429215
1 074978135
9297
410118
Gross income 3 175 3 178 2 517 3 462 2 756 2 904
Operating expensesImpairments - o/w on loans and receivables - o/w on AFS assetsGross technical charges, insuranceCeded reinsurance resultShare in results, associated companies
-1 269-152
-33-119
- 1 169-520
- 1 105-90
-74 -12
-1 240-22-60
-1 147-44-15-18
-771-1234
-1 424-79-76
-2-1 454
-2928
-1 104-15
3-16
-612-1721
-1 209-42-38
0-852
-1713
Profit before taxes 602 662 577 504 1 030 797
Income tax expense
Minority interests
-170-55
-177-51
-155-57
-35-29
-256-57
-212-48
Net profit 376 434 365 440 717 536
63
CEE
CSOB K&H KB NLB Insurance
CEE, company overview
1H 2005 (in m EUR)
547 207 149 12 131 Gross income
-265 -142 -113 -83 General expenses
6 -25 12 -1 Impairments
-61 10 9 -10 Taxes
227 30 57 38 Standalone profit
7 -6 -4 -1 Adjustments, o/w elimination of yield on excess capital, etc
-24 -10 -8 -7 Minority interests
210 15 45 12 30 Profit contributionto Group
83% 17% 42% 31% Return on allocated capital
64
CEE banking - I/S details, 1H 2005
1H 2005 CSOB KB K&H NLB
Statutory accounts
Net interest incomeDividend incomeNet gains from financial instruments at fair valueNet realised gains from available for sale assetsNet fee and commission incomeOther income
252 1975 631
44 8666 496
114 291123 249
101 629184
17 312-1 14822 648
8 659
107 767127
50 139-191
42 9186 490
Gross income 546 730 149 283 207 251
Operating expensesImpairmentsShare in result of associated companiesTaxes
-265 0166 169
0-60 971
-113 08212 143
988 618
-142 048-25 178
1 369-10 989
Net statutory profit 226 911 57 061 30 405
Profit contibution to Group
Net statutory profitConsolidation adjustmentsResults of capital allocationMinority interests
226 91118 758
-11 586-23 609
57 061-949
-3 295-7 644
30 405-940
-4 870-9 971
Profit contribution, Group shareROACROI
210 47483%26%
45 17242%14%
14 62417%11%
11 731
65
CEE banking - I/S details, 2Q 2005
2Q 2005 CSOB KB K&H NLB
Statutory accounts
Net interest incomeDividend incomeNet gains from financial instruments at fair valueNet realised gains from available for sale assetsNet fee and commission incomeOther income
128 3132 118
25 9552 177
56 5988 801
51 216184
5 803-2 6116 4215 298
54 290114
24 864-141
18 3383 845
Gross income 223 961 66 311 101 309
Operating expensesImpairmentsShare in result of associated companiesTaxes
-142 6221 597
0- 7 434
-53 72412 118
09 950
-73 645-15 509
0633
Net statutory profit 75 502 34 174 9 559
Profit contibution to Group
Net statutory profitConsolidation adjustmentsResults of capital allocationMinority interests
75 502-299
- 6 377-6 106
34 174- 440
-1 267-4 406
9 559-443-213
- 1 695
Profit contribution, Group share 62 721 28 060 7 208 3 308
66
No. of shares outstanding
BASIC NUMBER OF SHARES (in millions)
Ordinary shares
Mandatory convertibles
Treasury shares
Basic No.of shares
Avg. quarter
Average Ytd
31/12/03 367.7 2. 6 -11.0 359.4 - -
31/03/04 367.0 2. 6 -10.1 359.6 359.5 359.5
30/06/04 366.3 2. 6 -9.7 359.2 359.4 359.5
30/09/04 366.3 2. 6 -9.5 359.4 359.3 359.4
31/12/04 366.4 2. 6 -9. 6 359.5 359.5 359.4
31/03/05 366. 4 2. 6 -12.6 356.5 358.0 358.0
30/06/05 366. 4 2. 6 -9.1 360.0 358.3 358.1
DILUTIVE NUMBER OF SHARES (in millions)
Basic No. of shares
Stock options
Convertible bonds
Dilutive No. of shares
Avg. quarter
Average Ytd
31/12/03 359.4 6.1 5.2 370.7 - -
31/03/04 359.6 6.1 5.2 370.9 370.8 370.8
30/06/04 359.2 6.0 5.2 370.5 370.7 370.8
30/09/04 359.5 5.8 5.2 370.5 370.5 370.7
31/12/04 359.5 5.0 5.2 369.7 370.1 370.5
31/03/05 356.5 5.0 5.2 366.7 368.2 368.2
30/06/05 360.0 4.0 5.2 369.3 368.0 368.1
Net profit 1H 05 (in m)
1 253
Basic number of shares
358 122 942
Dilutive number of shares
368 084 650
Basic EPS (in euros)
3.50
Dilutive EPS (in euros)
3.42
Foto gebouw
4 Information on capital management
68
Capital position
Capital position
Available capital 1
Surplus capital 2
Immediatefree surplus 3
Banking 10.7 bn 2.1 bn 1.5 bn
Insurance 2.8 bn 1.2 bn 0.4 bn
Gevaert 1.2 bn 1.0 bn 0.4 bn
Total 14.7 bn 4.3 bn 2.3 bn
Internal capital budget requirements
Deleveraging of the holding company 0.4 – 0.6 bn
Buy-out of 3rd parties in CEE 0.8 – 1.3 bn
External growth in CEE 1.0 – 2.0 bn
1 Regulatory capital under Basel I/Solvency I (incl. hybrids and minority interests, after elimination of intangibles and goodwill), based on capital position as at 30-Mar-052 Difference between available capital and internal minimum level3 Surplus capital excl. expected adverse IFRS impact on Tier-1, banking (as of 2006), unrealized gains on tied-up assets (insurance) and value of Agfa-Gevaert (timing of disposal uncertain)
Closing remarks on valuation
Foto gebouw
5
70
Valuation
weighted P/E 2005-06
unweighted P/E 2005-06
CEE banks 2 15.0 15.1
CEE-exposed banks 3 11.6 12.4
Euro-zone banks 4 11.5 12.4
KBC 1 10.9 10.9
BEL banks 5 10.3 10.4
Key figures: Share price: 66.6 euros Net asset value: 40.0 euros 1H 2005 EPS: 3.50 euros
Analysts’ estimates: 1
2005 EPS consensus: 5.97 (+33% y/y) 2006 EPS consensus: 6.24 (+4% y/y) 2005-06 P/E: 10.9
Recommendations: Positive: 42% Neutral: 42% Negative: 16%
Valuation relative to peer group:
Weighted and unweighted averages of IBES data :2 OTP, Komercni, Pekao, BPH PBK, BRE3 BA-CA, Erste, Unicredit, Soc. Gen., Intesa BCI4 Top-20 DJ Euro Stoxx Banks 5 Fortis, Dexia
Situation as at 18 August 2005
5 Smart consensus collected by KBC (18 estimates)
71
Analysts’ recommendations
Fair value momentum
61.864.3
67.5 67.8 67.170.5 70.5 70.6
45
50
55
60
65
70
75
Jan-05 Feb-05 Mar-05 Apr-05 May-05 Jun-05 Jul-05 01-Aug
Fair value (smart consensus) Share price (month average)
EPS momentum
5.22
5.43
5.63 5.68 5.685.76 5.76 5.80
4.5
4.7
4.9
5.1
5.3
5.5
5.7
5.9
Jan-05 Feb-05 Mar-05 Apr-05 May-05 Jun-05 Jul-05 Aug-05
IBES consensus 2005 EPS