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KBC Bank & Insurance Group

KBC Bank & Insurance Group. General Meeting of Shareholders. 25 April 2002. KBC Bank & Insurance Group Results. 2000 (1). 2001.  %. Consolidated profit (in EUR m) - Contribution, banking - Contribution, insurance - Contribution, holding company Consolidated profit (%)

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KBC Bank & Insurance Group

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  1. KBC Bank & Insurance Group General Meeting of Shareholders 25 April 2002

  2. KBC Bank & Insurance GroupResults 2000(1) 2001  % Consolidated profit (in EUR m) - Contribution, banking- Contribution, insurance- Contribution, holdingcompany Consolidated profit (%) - Contribution, banking- Contribution, insurance 1 166 877321-31 75.0%27.5%-2.5% 1 022 698360-35 68%35%-3% - 12.3% - 20.4%+ 12.2%+10.3% - -- (*) 2000: excluding gain realized on sale of investment in CCF.

  3. KBC Bank & Insurance GroupRatios 2000(1) 2001 23.366.5106.3 9.5%307% 17.370.5103.8 8.8%318% Profitability/Efficiency Return on equity Cost/income ratio, bank Combined ratio, insurance Solvency Tier-1 ratio, bankSolvency ratio, insurance (*) 2000: excluding gain realized on sale of investment in CCF.

  4. Positive developments Increase in market share Home loans : 25.6% (+ 0.5%) Deposit books : 20.0% (+ 0.6%) Savings certificates: 17.8% (- 0.1%) Unit-linked life assurance : 20.2% (+ 0.5%) Increase in profit contribution from Central Europe Excellent result in non-life insurance business 2.5 bn EUR growth in assets under management Negative developments Unfavourable economic situation High provisions for loans Adverse financial markets Fees from securities business: - 12% (organic) Negative result, equity and derivatives subsidiaries Premium income, unit-linked life assurance : - 15.7% KBC Bank & Insurance GroupMain developments

  5. KBC Bank2001 Results Organic  % In millions of EUR  % 2000 2001 Gross incomeGeneral admin. expenses Operating result Value adjustments and provisions Extraordinary 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. gains on CCF

  6. KBC BankBreakdown of gross income • Interest margin : 2.02% (s.q.) • Commissions: • Securities : 52% • Payments : 17% • Insurance : 4% • Other : 27% • Fin. Transact. : profit : (m EUR) • Shares : 57 (2000 : 272) • Bonds : 218 (2000 : 26) Net interest income+ 9.2% Other income(+7.1%) 8% 53% 21% Commision income (+2.2%) 18% Fin.Transact. (+5.9%)

  7. KBC Bank2001 Results Organic  % In millions of EUR  % 2000 2001 Gross incomeGeneral admin. expenses Operating result Value adjustments and provisions Extraordinary 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. gains on CCF

  8. KBC BankProvisioning for credit risks 1999 2000 2001 In millions of EUR Specific provisions- Domestic- International General provision Loan loss ratio- Domestic- International Non-interest-bearing 270.4103.2167.1 71.2 0.240.48 2.1% 285.1252.632.5 -43.8 0.530.09 2.1% 330.7166.6164.1 -9.3 0.350.38 2.8%

  9. KBC Bank2001 Results Organic  % In millions of EUR  % 2000 2001 Gross incomeGeneral admin. expenses Operating result Value adjustments and provisions Extraordinary 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. gains on CCF

  10. KBC Insurance2001 Results In millions of EUR 2000  % 2001 7691 881-2 517615 748 -376 372 25-5 392 -74 2 321 8201 688-2 330631 809 -409 401 8-2 407 -51 4 360 6.6-9.9-7.42.6 8.2 8.7 7.7 - 69.2- 67.2 3.8 -30.4 - 12.2 Premium income, non-lifePremium income, lifeNet technical charges(*)Investment income(*) Gross margin General admin. expenses Recurring result Non-recurring resultExtraordinary result Profit before tax Taxes Minority interests Profit after tax (*) excl. effect of value adjustments, unit-linked life assurance

  11. KBC InsuranceBreakdown of premium income • Premium-income • Non-life assurance • Traditional lifeassurance • Unit-linked lifeassurance Non-life (+ 7%) Trad. Life (+7.1%) via :Agents (%) Banks(%) 18% 34% 68.8 38.0 1.0 8.8 46.6 97.0 48% Unit-linkedclass 23 (-15.7%)

  12. KBC Insurance2001 Results In millions of EUR 2000  % 2001 7691 881-2 517615 748 -376 372 25-5 392 -74 2 321 8201 688-2 330631 809 -409 401 8-2 407 -51 4 360 6.6-9.9-7.42.6 8.2 8.7 7.7 - 69.2- 67.2 3.8 -30.4 - 12.2 Premium income, non-lifePremium income, lifeNet technical charges(*)Investment income(*) Gross margin General admin. expenses Recurring result Non-recurring resultExtraordinary result Profit before tax Taxes Minority interests Profit after tax (*) excl. effect of value adjustments, unit-linked life assurance

  13. KBC InsuranceNon-recurring result 2000(1) 2001 144.8 91.923.329.6 -89.9-29.6 25.3 37.2 37.2- - 29.4 7.8 • Non-recurring income • - Gains on shares- Changes in premium reserve- Provision for Y2K • Non-recurring provision • Provision for financial risk- Extra provisions • Non-recurring result

  14. KBC Insurance2001 Results In millions of EUR 2000  % 2001 7691 881-2 517615 748 -376 372 25-5 392 -74 2 321 8201 688-2 330631 809 -409 401 8-2 407 -51 4 360 6.6-9.9-7.42.6 8.2 8.7 7.7 - 69.2- 67.2 3.8 -30.4 - 12.2 Premium income, non-lifePremium income, lifeNet technical charges(*)Investment income(*) Gross margin General admin. expenses Recurring result Non-recurring resultExtraordinary result Profit before tax Taxes Minority interests Profit after tax (*) excl. effect of value adjustments, unit-linked life assurance

  15. KBC Bank & Insurance GroupProfit Contribution byActivity -13.7% 422 31 Dec. 00 : 1181 m EUR 31 Dec. 00 : 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 % profitcontribution 36% 36% 13% 21% 19% 5% 7% 12% 9% 9% 15% 16% Retail bancassurance Corporate services Market activities Central Europe Asset management Groupitems

  16. KBC Bank & Insurance Group Profitability – areas of activity %of total equity Allocated equity (in EUR m) % profit contri-bution At 31 Dec. 2001 ROE Retail bancassurance Corporate services Market activities Central Europe Asset management Group item 2700 2502 1133 1897 - -377 35% 32% 14% 24% - -5% 13.9% 8.3% 4.1% 7.5% - - 36% 21% 5% 12% 9% 18%

  17. Retail bancassuranceIntegration of Banking & Insurance • Merger of ICT departments • Joint marketing, communication and logistics at KBC Bank and Insurance Holding Company • Total ±2000 employees

  18. Retail bancassuranceCross-selling in Belgium Total customers, bank 1 337 000 Total customers, insurance 744 000 555 200 Shared customers • Cross-selling • 555 200 customers with at least 1 bank AND 1 insurance product • + 4.2 % from 31 Dec. 2000 • 36.4 % of all customers -> target 40 %

  19. Retail bancassuranceMerger process on schedule • Conversion and integration ofinsurer completed • Merger process at KBC Bank completed by 2004 • Closure of bank branches • ± 1500  ± 850 • 1 IT system • IT-related work nearly finished • 2 250 000 customers already on new system, 300 000 more to go • Downsizing • Gradual reduction in workforce by 1 650 (11%) by end of 2004

  20. planned-300 achieved-321 Retail BancassuranceIntegration of retail bank branches

  21. Retail bancassuranceMerger process on schedule • Conversion and integration of insurer completed • Merger process at KBC Bank completed by 2004 • Closure of bank branches • ± 1500  ± 850 • 1 IT system • IT-related worknearly finished • 2 250 000 customers already on new system, 300 000 more to go • Downsizing • Gradual reduction in workforce by 1 650 (11%) by end of 2004

  22. KBC Bank & Insurance GroupInvestments in Central Europe Marketshare Investmentin EUR m Ownership 450.7 7.2 127.2 5.5% 1%13% non-life Poland Kredyt Bank Agropolisa Warta 66.6% 49.9% 40.0% 83.8% 100.0% 65.0% 100.0% 1 363.3 15.5 63.0 53.5 18.5% 0.6% non-life11% life/ 5% non-lifena Czech & Slovak Rep. CSOB CSOB Pojist'ovna IPB Pojist’ovna Patria 13.4% 2.1% 3.5% 59.0% 50.0% 98.8% 273.2 2.5 30.5 Hungary K&H Bank K&H Life Argosz Slovenia * NLB 34.0% 435.0 45.0% Total investment: 2.8 bn EUR * Decision in principle : being finalized

  23. KBC Bank & Insurance GroupKey figures per share 1998 1999 2000 2001 Net earnings P/E (year-end) Gross dividend Payout ratio Net asset value Price/NAV (year-end) 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

  24. KBC share pricein EUR

  25. Relative performance of KBC share price

  26. KBC Bank & Insurance GroupProposed profit appropriation Profit for the period available for appropriation Profit brought forward from the previous financial year Profit to be appropriated Proposed profit appropriation: *Allocation to own funds - To the legal reserve (1) - To other reserves * Profit to be paid out - Dividends (301 464 574 shares) - Directors - Profit to be carried forward 555 557 037.57 447 657.47 556 004 703.04 501 057.76105 000 000.00 446 167 569.521 303 595.333 032 480.43 (1) to raise it to 10 % of capital

  27. KBC Bank & Insurance Group If the proposed appropriation of profit is approved, dividends (No.35) will be payable as follows from 29 April 2002 :

  28. KBC Bank & Insurance Group General Meeting of Shareholders 25 April 2002

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