Monday 22 January 2018

Workers at KBC bank will learn fate today

Banking analysts expect Belgian lender KBC Group to reveal that it will retain its Irish wing,
a move that would provide relief to the roughly 1,000 employees spread across the country Photo: AFP
Banking analysts expect Belgian lender KBC Group to reveal that it will retain its Irish wing, a move that would provide relief to the roughly 1,000 employees spread across the country Photo: AFP
Colm Kelpie

Colm Kelpie

A thousand bank workers are waiting to learn their fate today as KBC announces whether it will stick with its Irish operation.

Banking analysts expect Belgian lender KBC Group to reveal that it will retain its Irish wing, a move that would provide relief to the roughly 1,000 employees spread across the country.

The call on whether to stick with KBC Ireland, and possibly even ramp up the brand, will be announced along with end-of -year financial results.

However, an exit would not only affect the employees, but also the hundreds of thousands of customers here.

KBC had long flagged that a decision would be taken on what to do with its Irish bank in 2016 - but that has been put off until the final results for the year are prepared.

It returned to profit in 2015 for the first time since the crash. Despite uncertainty about its long-term plans, the bank has been growing in Ireland in recent years.

Owen Callan, analyst with specialist bank Investec, said earlier comments made by KBC Group chief executive Johan Thijs suggested that the operation would remain here.

"I think the first thing we want to hear from them is that they will be committed to the Irish market for the next few years and staff will obviously take huge positives from that, as will consumers," Mr Callan said.

"Beyond that, what sort of strategy it will involve will come at a later stage, but it may give some indication of what sort of increase in its footprint it will make in Ireland."

Options

KBC has scope to expand here, and committing to the Irish market would also place it in a position to be a key element in any eventual consolidation with Ulster Bank or Permanent Tsb, Mr Callan said.

Options for KBC include retaining the Irish unit and seeking to organically grow it as a stand-alone retail bank; building a captive bank- insurance group; looking at merging with another Irish business or selling the Irish bank.

Emer Lang, analyst with Davy Stockbrokers, believes the status quo will be maintained.

"It's done well, it's back to decent profitability and it has certainly become a solid competitor in the mortgage market," he said.

Irish Independent

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