Belgian private bank sold to Qatari investor
Belgian bancassurance group KBC has agreed a €1.05bn sale of its private banking arm, KBL European Private Bankers, through Precision Capital, a Luxembourg-based entity representing a Qatari investor.
The sale will provide the Qatari investor with access to a large client base and includes the non-private banking activities of KBL such as its custody and life insurance businesses.
KBL’s affiliated local banks are located in nine European countries including Belgium, France, Germany, Luxembourg, Monaco, the Netherlands, Spain and the UK.
KBL’s brand, management team and operations will remain headquartered in Luxembourg.
According to KBC, the sale will provide the bank with €0.7bn in capital allowing its tier-1 ration to increase by 0.6%.
It is not the end for KBC’s private banking services in Europe however as its KBC-branded private banking units will continue running their respective businesses.
According to Jan Vanhevel, CEO of KBC Group, the sale follows “particularly challenging” market circumstances in recent months. He said the extra capital will play an important role in helping KBC refocus its strategy on its core bancassurance activities.
He added that under Precision Capital’s guidance, KBL should be able to grow onshore in Europe and further afield in the Middle East and Asia.
Jacques Peter, CEO of KBL, confirmed the private bank’s goal of expanding outside of Europe, explaining that “with Precision Capital, we will be able to work closely together with the aim of tapping into new markets, in particular in the Middle East and Asia.”
This is not the first time KBC has reached an agreement to sell KBL. In May 2010 the bank announced it had agreed a deal to sell its private banking arm to conglomerate Hinduja Group, but the deal fell through in March 2011 as the Hinduja Group was unable to obtain approval for the deal from the regulators in the ten European countries in which KBL is active.
KBC Group caters mainly for retail, SME and midcap customers. It concentrates on its home markets of Belgium and certain countries in Central and Eastern Europe. It was formed in 1998 following the merger of the Kredietbank, Cera Bank and ABB Insurance.