Belgian bank KBC has reported a net profit of €925 million in the second quarter of the year, a jump of more than €400 million compared to the first three months of the year. However, the group highlighted that this is mainly due to the bulk of banking and insurance taxes being paid at the start of 2024.
KBC provides banking and insurance services in Belgium, as well as in Czechia, Slovakia, Hungary and Bulgaria, among other locations. The group employs 41,000 people across around 1,200 branches.
The bank recorded net profits of €925 million for the second quarter, up from €508 million in the first quarter. CEO Johan Thijs stated that the quarterly increase was due to higher income from interest, fees and commissions, "solid" insurance revenues, better trading and fair value income, and a "seasonal peak" in income from dividends.
However, when comparing the second quarter of this year to the same period in 2023, net profits fell by €41 million. Regardless, Thijs said that the overall performance of the company in the first half of 2024 was "excellent yet again," adding that net profit for the first half of 2024 amounted to €1.431 billion.
"At first sight, this is much lower than the result for the year-earlier period, but that period had benefited from a positive €0.4 billion one-off gain on the sale of the Irish loan and deposit books. Excluding that one-off gain, our half-yearly profit was in line with the year-earlier figure," the CEO commented.
Belgian operations
In Belgium, the second quarter's net profits of €519 million were more than double the results of the previous quarter.
KBC said that bank and insurance taxes paid at the beginning of the year "distort" the quarterly comparison: when excluding these taxes, the bank's Belgian operation saw a fall of 7% in net profits from the first quarter of 2024.
The bank noted this was due to the combined effect of higher total income (mainly from interest, trading and fair volume, and dividends), stable costs, higher insurance service expenses, and increased net impairment charges.
The Group stated that its loan portfolio is continuing to expand, increasing by 2% quarter-on-quarter and by 4% year-on-year. Customer deposits also increased by 2% over the quarter, and are stable compared to last year.
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The bank highlighted that an increasing number of customers are buying banking products online. Around 55% of banking and 27% of insurance products were sold through a digital channel in the second quarter, up from 50% and 24% a year ago.
KBC also said that it has seen a 40% increase in the number of customers using its AI-powered personal digital assistant Kate since last year.
The bank improved its forecast for the full year, predicting a net interest income of a "ballpark" €5.5 billion, up from a range of €5.3 to €5.5 billion.
