KBC announced on Wednesday that the European Central Bank (ECB) has slightly increased the level of capital required from the Belgian banking group in response to unfavorable economic conditions.

The ECB, which is responsible for supervising banks in the eurozone, has raised its 'CET1' requirement from 10.62% to 10.92%, an increase entirely due to KBC's exposure to Eastern European countries, led by Bulgaria and the Czech Republic.

At the end of the third quarter of 2023, however, the bank's fully loaded CET1 ratio stood at 14.6%, well above the new requirement set by the ECB.

In a press release, CEO Johan Thijs reiterates his group's ambition to become one of Europe's best-capitalized financial institutions.

He points out that KBC currently has a payout ratio policy (dividend plus AT1 coupon) of at least 50% of consolidated profit, with the declared aim of improving its capital distribution in the event of a CET1 above 15%.

Following these announcements, KBC shares rose by 1% on Wednesday morning on the Brussels stock exchange, making them one of the strongest performers on the BEL 20 index.

Copyright (c) 2023 CercleFinance.com. All rights reserved.