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Sale of KBL epb to Hinduja Group will not go through
The CSSF yesterday confirmed that it was stopping its evaluation of the acquisition, after concluding that its decision would have been to object to it. The CSSF reached this decision based on application of the criteria set out in the law governing the financial sector and after consulting with the other competent authorities.
In practice, this means that the sale of KBL epb to the Hinduja Group will not go ahead.
KBC takes note of this decision. Over the coming weeks, and in relation to implementing its strategic plan, the group will thoroughly assess the various options so that, given current market conditions, it can take the best decision regarding the future of KBL epb.
Jan Vanhevel, KBC Group CEO: 'The Hinduja Group was selected last year based on various criteria such as the price it offered, its industrial project and future plans for KBL epb, the continued focus on private banking it was able to guarantee both the clients and staff of KBL epb. To our surprise and regret, the Hinduja group was unable to obtain approval for this deal from the regulators in the ten European countries in which KBL epb is active. Although, naturally, we were and are unable to do anything about the situation, there is no denying that this is disappointing for us. However, it does not jeopardise implementation of our strategic plan, because the European Commission has given us enough flexibility to enable us to carry out our divestments under the best possible conditions. We will, therefore, thoroughly assess the various options for KBL epb over the coming weeks so that, given the current market conditions, we can take the best decision regarding the future of KBL epb, and thus provide security for its staff and clients. It is also most comforting to know that KBL epb is in good hands. Despite the challenging market conditions, KBL epb's management - under the leadership of CEO Jacques Peters - has continued rolling out its efficiency improvement programme in various countries, strengthened its balance sheet and reduced its cost base, and hence enhanced the overall quality of the assets. All of which has prepared KBL epb for the challenges ahead.'
Jacques Peters, CEO of KBL epb: 'Of course we are disappointed that it had to end this way. However, we are very pleased to note that, over the past months, our clients and staff have continued to believe and have confidence in our customer-focused model and forward-looking strategy. Moreover, we have succeeded in attracting many new clients and private bankers in the various countries where we are present. Despite the persistently difficult market conditions in 2010, our assets under management have increased, fee and commission income has risen further and expenses have fallen. Consequently, KBL epb remains in an excellent position to respond to the expanding market for private banking. Going forward, our clients can continue to rely on a top-quality service from a highly motivated and professional staff. We are, therefore, confident that, together with the KBC group, we will take the right decision to safeguard our future."
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