kbc ireland q2 prices kbc bank ireland €166m
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KBC Bank Ireland posted a 213 per cent surge in profit in the first half of the year, driven by the release of bad loan provisions on the back of rising house prices.
Net profit came to €166 million for the period, as the lender freed up €137 million that had previously been set aside to absorb soured loan losses. The bank’s parent, Brussels-based KBC Group, said on Thursday that it now expects the Irish unit to release between €160 million and €200 million of such provisions for the full year, compared to its previous forecast of €120 million-€160 million.
KBC Group reaffirmed its commitment to Ireland in February, following two years of speculation about its future. It acquired control of the Irish business in 1978 and currently employs about 1,000 people. The company has signalled its interested in banking and insurance acquisitions in Ireland to expand its footprint, though its chief executive, Wim Verbraeken, said in June that the group isn’t currently working on any potential deals.
The business aims to double its number of customers to 425,000 in the four years to the end of 2020.
KBC Bank Ireland’s loan-loss provisions release in the first half was largely on the back of rising houses, with figures published by the Central Statistics Office this week showing that residential property values rose by 11.6 per cent year-on-year in June, the fastest pace seen in two years.
Still, 40 per cent of the €12.7 billion mortgage-dominated Irish loan book was classified as impaired at the end of June, unchanged from March, leaving KBC with ostensibly the highest level of such loans among Irish retail banks. However, KBC Bank Ireland applies the strictest classification of non-performing loans in the county and the level of loans in arrears is much lower.