The following is a summary of the KBC Group NV (KBCSY) Q1 2024 Earnings Call Transcript:

Financial Performance:

• KBC Group reported a net result of €506 million for Q1 2024, impacted by bank taxes of €518 million.

• Diversified income sources contributed to the results, with net interest income showing a positive trend.

• Loan volume growth was up 4% YoY and 1% QoQ whilst net interest income was €1,369 million, a YoY growth of 3% and QoQ growth of 1%.

• The deposit base grew by 1% both quarterly and annually.

• Capital position improved to 15.2%, resulting in a common equity Tier 1 ratio fully loaded of 14.93% after a planned payout of surplus capital of €280 million.

• KBC confirmed a dividend policy for 2024 with a payout ratio policy dividend and AT1 coupon at at least 50% of the consolidated profit for the accounting year.

• The bank's insurance business recorded strong growth with a 9% increase in non-life sales YoY across all KBC's markets.

• Life insurance sales also increased: a 12% growth QoQ and a massive 60% YoY.

• KBC maintained cost control with a decrease of 9% in operating costs QoQ and a 1% drop YoY.

Business Progress:

• KBC's AI Assistant 'Kate' had 4.5M users, resulting in more than 41M interactions, two-thirds of which were handled without human assistance.

• The bank shifted €3.5 billion in Q1 deposits due to competitive dynamics in current, savings and time deposits.

• KBC's credit cost ratio, after excluding the buffer release, is expected to be 10 basis points.

• KBC Group NV expects uncertainty in the coming months due to the expiration of the banking law.

• The bank reports a cost decrease of 1% YoY due to changed operations in Ireland.

• KBC saw a healthy demand for longer term loans, particularly in Central and Eastern Europe.

• KBC's strategy for expansion includes possible M&A opportunities.

• The company discussed a decision to distribute €280 million in cash unrelated to the current share price.

• Credit costs remain low and are expected to stay significantly below the long-term average.

• KBC Group launched a new product in Q1, continuing to focus on customer-centric solutions.

• Guidance on the cost side suggests being well within the ceiling by the end of the year.

• Regular investment plans make up for 22% of the Q1 composition, with €1.9 billion coming from all other products.

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