KBC Bank

1
KBCBank Insurance Group

• Full year results 2001

Brussels 4 March 2002
2
KBC Bank Insurance Group

• Group results and key features
• Results - Banking
• Results - Insurance
• Profit contribution by activity
• Outlook

3
KBC Bank Insurance GroupKey figures
2001
?
In millions of EUR
2000
Consolidated profit - Group share (1) -
Banking - Insurance - Holding company Key
figures per share (in EUR) - Net earnings - Net
asset value - Net dividend - Pay-out ratio
1 165.5 876.7 320.6 -31.8 3.90 35.2
1.065 36.4
-12.3 -20.412.2 -10.3 -13.0 -4.0 4.2 -
1 022.4 697.6 359.9 -35.1 3.39 33.8
1.11 43.6

• figures for 2000 excl. capital gain on CCF

4
KBC Bank Insurance GroupNet group profit per
quarter
In m EUR
-12.3
5
KBC Bank Insurance GroupQ4 2001 Key
developments

• Positive developments
• Slight recovery of financial markets
• Write back of unrealized valuation losses on
  shares
• Better performance of equity and derivatives
  subsidiaries
• Recovery of unit-linked sales ( 35 versus Q3)
• Higher interest income 4.7 (excl. KB Poland)
• Capital gains on fixed-income securities
• Strong performance of non-life business due to
  fewer claims in reinsurance
• Negative developments
• Higher specific loan provisioning
• Cost increase excl. one-off items 15
• Full consolidation of Kredyt Bank Poland

6
KBC Bank Insurance GroupGroup profit and
profitability
20.2
-12.3
21.6
12.8
In millions of EUR
23.3
20.5
17.3
16.1
7
KBC Bank Insurance GroupFY 2001 key
developments

• Positive developments
• Increase in market shares
• Positive development of the profit contribution
  by Central Europe
• 2.5 bn EUR growth in assets under management
• Efficiency
• Organic cost development in banking improving
  3.3
• Combined ratio in insurance at 103.8 approaching
  the 2004 target
• Strong solvency ratios
• Strenghtening of pure equity by transfer of FGBR
• Negative developments
• Unfavourable market conditions for volatile
  revenue components
• Commission income - 12 (organic)
• Negative result for equity and derivatives
  subsidiaries
• Unit-linked premium income - 15.7
• High loan provisioning

8
KBC Bank Insurance GroupSustained solid
solvency ratios
2000
1998
1999
2001

• Bank
• Tier-1 ratio
• CAD ratio
• Insurance
• Solvency ratio ()

9.5 16.0 307
7.4 12.8 298
8.8 14.7 318
7.2 11.5 311
Decrease of solvency ratios in banking due to
widening of scope of consolidation
() excluding unrealized capital gains
9
KBC Bank Insurance Group

• Group results and key features
• Results - Banking
• Results - Insurance
• Profit contribution by activity
• Outlook

10
BankingSummary
Org. ?
In millions of EUR
?
2001
2000
Gross operating incomeGeneral admin.
expenses Operating result Value adjustments and
provisionsExtraordinary result Profit before
tax Taxes Minority interests Profit after tax
4656 -3094 1562 -334 49 1277 -243 -158
877 (1)
4977-3510 1467 -37680 1171 -313 -160 698
6.913.4 -6.1 12.8- -8.4 28.8 1.5 -20.4
-1.43.3 -10.9 -4.5- -9.5 19.1 1.5 -18.9
(1) excl. capital gain on CCF
11
BankingIncome Stream
Total 4977
Total 4656
7.1
Total 3868
2.2
Total 3435
5.9
In millions of EUR
9.2
of total income
1999 2000 2001
Other income Commission income
Profit on financial transactions
Net interest income (incl.
dividends)
8 20 16 56
8 22 18 52
8 21 18 53
12
BankingStaff charges
Total 1843 (10)
2.7
Total 1675
2.3
In millions of EUR
Increase at KBC Belgium of 27 m EUR due to
Inflation 20.5 m FTE 13.8 m Other - 7.3
m
13
BankingOther operating expenses
Total 1667 (17.5)6.9
Total 1419
0.8
In millions of EUR
Increase at other companies of 6.9 or 56 m EUR
due to KBC Lease 29 m KBC FP 11 m KBC
AM 3 m
expansion of activities
14
KBC Bank Insurance GroupCost/Income ratio
1999
2000
2001

• As published
• At unchanged scope of consolidation
• Taking into account 2004projected cost savings
• Staff charges 115 m EUR
• IT 89 m EUR
• Other 20 m EUR

65.3
70.5 69.7 66.0
66.5
15
BankingProvisioning for credit risks
In millions of EUR
2000
1999
2001
Specific provisions Domestic International of
which Kredyt Bank Other general provisions for
credit risks Loan loss ratio Domestic Internatio
nal Non-performing ratio
285.1 252.632.5 -43.8 0.530.09 2.1
270.4 103.2167.1 71.2 0.240.48 2.1
330.7 166.6164.139.0 -9.3 0.350.38 2.8
Increase of non-performing ratio due to Kredyt
Bank Poland 0.4 pt Organic 0.3 pt
16
KBC Bank Insurance Group

• Group results and key features
• Results - Banking
• Results - Insurance
• Profit contribution by activity
• Outlook

17
InsuranceSummary
In millions of EUR
2001
2000
?
Non-life premium incomeLife premium incomeNet
technical charges ()Investment income ()
Total gross margin General expenses Recurring
result Non-recurr. and extraord. result Profit
before tax Taxes Minority interests Profit after
tax
8201 688-2 330631 809 -409 401 6 407
-51 4 360
7691 881-2 517615 748 -376 372 20 392
-74 2 321
6.6-9.9-7.42.6 8.2 8.7 7.7 - 3.8
-30.4 - 12.2
() excl. impact of value changes of unit-linked
products
18
InsuranceEvolution of gross premiums
-15.7
In millions of EUR
7
7.1
44.5
19
KBC Bank Insurance GroupEfficiency Ratios
1999
2000
2001
Non-life Net expense ratio Net loss ratio
(total) Net loss ratio (direct business) Combined
ratio Target by 2004
33.6 72.5 70.2 106.1
34.4 69.4 63.9 103.8 103.0
34.0 72.6 66.6 106.6
Combined ratio target for 2004 almost achieved
20
InsuranceContribution to net group profit
Total 361
Total 321
34
Total 272
Total 237
In millions of EUR
12
8.1
of total recurring result 1999
2000 2001
Non-technical Non-life
Life

10 47 37
11 39 50
13 39 48
21
KBC Bank Insurance Group

• Group results and key features
• Results - Banking
• Results - Insurance
• Activities
• Retail bancassurance
• Corporate services
• Market activities
• Central Europe
• Asset management
• Outlook

22
Profit Contribution by Activity
-13.7
422
31-12-00 1181 m EUR
31-12-01 1022 m EUR
364
43.3
In millions of EUR
228
-4.3
211
38.4
175
168
-12.6
147
138
109
100
-79.6
95
47
profit contribution
36 36
13 21
19 5
7 12
9 9
15 16
Retailbancassurance
CentralEurope
Corporateservices
Assetmanagement
Marketactivities
Groupitems
23
Retail Bancassurance

• 2001
• Stable interest income but negative impact of
  stock market climate on commission income
• Slightly higher costs
• Market shares(1) on the rise (from 12/00)
• Consumer credit 26.1 0.3 pts
• Home loans 25.6 0.5 pts
• Savings deposits 20.0 0.6 pts
• Savings certificates 17.8 - 0.1 pts
• Unit-linked prod. 20.2 0.5 pts
• Positive development of cross-selling
• 555 200 mutual clients buying 1 insurance and
  1 bankproduct ( 4.2 versus Dec. 2000)
• Merger process on track

Financial highlights
Profit contribution (in m EUR) 2000
422 2001 364 Share in Group profit
2000 35.7 2001 35.6 Return
on equity 2000 16.2 2001
13.9
(1) KBC estimates
24
KBC Bank Insurance Group Merger in Belgium on
track

• Conversion and integration at insurance company
  completed
• Merger in KBC Bank to be completed by 2004
• Closure of bank branches
• 1998 1500 branches
• 350 branches already closed, leaving 1150 at end
  2001
• Target by 2004 850 branches to remain
• Creation of 1 IT platform
• IT workload almost completed
• 2 250 000 clients already served on new platform,
  still 300 000 ex-KB clients to be migrated
  (target date mid 2004)
• Reduction of workforce
• Gradual reduction by 1650 (11) by end of 2004

25
Corporate services
Financial highlights

• 2001
• Increase of gross operating income ( 9)
• Higher interest income
• Higher commission income
• Lower income from corporate finance
• Higher operating expenses ( 9)
• Higher loan provisioning ( 25)from 202 m EUR
  to 252 m EURalso resulting in lower taxes
• Strategic reduction of risk weighted assets
  continued (- 9.5 or 4 bn EUR)
• Increase in domestic market share (1) in lending
• end 2000 20.7
• end 2001 22.5

Profit contribution (in m Eur) 2000
147.4 2001 211.1 Share in Group
profit 2000 12.5 2001
21.1 Return on equity 2000 5.7
2001 8.3
(1) KBC estimates
26
Market activities
Financial highlights

• 2001 profit contribution 80 lower
• Strong performance of dealing rooms (95 m EUR) in
  Belgium but especially abroad
• Weakness of stock markets reflected in negative
  results of equity subsidiaries KBC Securities (-
  14 m EUR) and KBC Financial Products
• Convertible bonds 11 m EUR
• Derivatives - 32 m EUR
• Other - 14 m EUR

Profit contribution (in m Eur) 2000
228.2 2001 46.5 Share in Group
profit 2000 19.3 2001
4.5 Return on equity 2000 20.5
2001 4.1
27
Central EuropeDevelopments in 2001
Total investments in C.E. to date 2.2 bn EUR

• Czech Slovak Republic
• Integration of bank distribution networks of
  CSOB and IPB completed
• Feb. 2002 acquisition of 65 of IPB Pojist'ovna
• Increase of stake in CSOB Pojist'ovna to 100
  Investment by KBC 3.6 m EUR
• 2002 planned integration of insurance companies
• Poland
• Increase of stake in Kredyt Bank Poland from
  49.9 to 56.6 Investment by KBC 60 m EUR
  (incl. capital increase)

28
Central EuropeDevelopments in 2001

• Hungary
• July 2001 merger of KH Bank with ABN AMRO
  Magyar. Investment by KBC 141 m EURCompletion
  of merger by mid 2002 ahead of schedule
• Slovenia
• End 2001 - March 2002 Binding offer on Nova
  Ljubljanska Banka (NLB) for 34 stake.Exclusive
  negotiations with Slovenian government.

29
Central Europe
? excl. changes
2001
?
2000
Profit contribution () (in m EUR) Share in group
profit Return on Equity
99.6 7.3 8.4
38.4
137.9 11.5 7.5
18
() before deduction of minorities
164.5 -1.0 -12.2 -3.2 -10.1
107.0 -0.3 8.4 -2.4 -13.0

• Profit contribution
• CSOB
• KH Bank
• Kredyt Bank
• Insurance subsidiaries
• Overhead

• Non-performing ratio
• KH Bank
• CSOB
• Kredyt Bank

1.8 2.6 11.6
30
Asset Management

• 2001
• Growth of operating income ( 3) in line with
  growth of AUM
• Profit contribution 12.6 lower due to higher
  costs
• Increase in assets under management,
  notwithstanding difficult market conditions
• 3.7 rise in 2001
• increase in volume (4.5 bn EUR) more than
  offsets decrease in value (- 2.2 bn EUR)
• Largest Belgian player in mutual funds
• market share 29.3 Dec. 2001
• 54 market share in capital-guaranteed funds

Financial highlights
Profit contribution (in m EUR) 2000
109 2001 95 Share in Group profit
2000 9.2 2001 9.3
31
Asset ManagementFurther growth in assets under
management
71.1 (2.2)
69.6 (34.1)
51.9 (41)
36.8 (18.3)
31.1
In billions of EUR
of total AUM
1999 2000 2001
Private Banking
Institutional funds
Mutual funds

7 34 59
10 23 66
7 35 58
32
KBC Bank Insurance Group

• Group results and key features
• Results - Banking
• Results - Insurance
• Profit contribution by activity
• Outlook

33
Outlook 2002

• Economic climate and market conditions remain
  uncertain
• Asset quality ?
• Equity related activities ?
• Expected growth of interest income
• Merger related savings will have positive impact
  on costs

Overall profit outlook uncertain
34
KBC Bank Insurance GroupKey figures per share
1999
1998
2000
2001
Net profit P/E Gross dividend Pay-out ratio Net
asset value Price / NAV
2.69 25.0 1.09 40.6 32.3 2.1
3.26 16.4 1.23 37.7 33.8 1.6
3.90 11.8 1.42 36.4 35.2 1.3
3.39 11.1 1.48 43.6 33.8 1.1
35
KBCBank Insurance Group

• Full year results 2001

Brussels4 March 2002