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KBC proposes changes to strategic plan.

(SeeNews) - Jul 13, 2011 - Belgian financial services group KBC (EBR:KBC) and the Belgian authorities yesterday formally applied to the European Commission to amend the company's strategic plan, KBC said on Wednesday.

The proposal for changes in the initial plan which was submitted in September 2009 include the replacement of the planned IPOs of minority stakes of Czech CSOB Bank and K&H Bank in Hungary by the divestment of KBC's Polish banking and insurance subsidiaries, Kredyt Bank and Warta, and the sale of selected ABS and CDO assets.

CEO Jan Vanhevel said in a statement the results in the last several quarters prove that the fundamentals of the KBC group are solid and that the company has a sound business model. "KBC is gradually becoming a more focused and less complex group, while maintaining economies of scale", according to Vanhevel. "We remain firmly committed to the bancassurance model which is at the core of our strategy and which we continue to develop within our home markets", the CEO said.

According to KBC, in the last 19 months occurred a number of factors which make some of the measures in the initial plan less effective. The company referred to the impact of certain changes in the regulatory environment, especially Basel III and draft IFRS rules on leases, and the difficulty involved in floating K&H in the current circumstances.

KBC said its main objective remains to execute the plan within the agreed timeframe and to repay the Belgian authorities in a timely manner. The proposed amendments are expected to release the same amount of capital as the originally intended measures, according to the company.

The European Commission's decision on the proposed amendments is expected in the coming weeks.
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Publication:ADP News Belgium
Date:Jul 13, 2011
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