KBC to remain and expand Irish unit despite losses
BELGIAN lender KBC said it will not sell its Irish unit and that the bank plans on generating more income from retail banking here.
The news comes after the global head of KBC Johan Thijs said yesterday that he regards the bank's loss-making Irish operation as a "core business."
The Irish arm was previously regarded as "non-core" by the bank.
Mr Thijs outlined KBC's strategic focus for 2013, including setting financial targets for 2015.
It's understood the main focus for Ireland will be on continuing to attract customer deposits, including adding a new Baggot Street branch in Dublin, bringing the number of branches to six.
KBC was a significant mortgage lender here during the 'Tiger' boom period, operating mainly through a network of brokers. Historically it was also seen as a business lender, having begun life here as Irish Intercontinental Bank (IIB) in the 1970s.
The bank was also a lender to the property sector, including the giant Treasury Holdings which it has sought to have wound up in the High Court. A hearing to settle the case will go ahead today.
Ireland will now be reclassified as a KBC core unit and as part of a new International Markets Business Unit which also includes the Belgian group's operations in Slovakia, Hungary and Bulgaria.
Non-core units in Germany, Serbia, Slovenia and Russia are to be sold off.
"Ireland remains an exception, where in the coming years KBC Bank Ireland will be managed to maximise its value contribution through its retail banking business," the lender said yesterday.
Irish head John Reynolds welcomed the news
"While the market remains challenging, we have ambitious plans to expand our online operations and to increase our presence in key locations.
''We are winning new customers by being a competitive alternative and will build sustainable business in Ireland based on understanding our clients and proactively offering products and services tailored to their needs," he said.
KBC Bank Ireland employs 700 people and has branches in Dublin, Cork, Limerick, Galway and Belfast.