Belfius Bank & Insurance turns in a fine performance in 2012
Net profit of EUR 415 million, substantial increase in total equity and almost EUR 10 billion invested in the Belgian local economy: Belfius Bank & Insurance turns in a fine performance in 2012
In 2012, Belfius Bank & Insurance recorded a net income group share of EUR 415 million (compared with a loss of EUR 1.37 billion in 2011). This profit, which will be used to strength the company’s capital base, was achieved through strict cost management and a number of significant capital gains that were allocated in part to the tactical derisking of the historical investment portfolio. Excluding one-off items, the underlying consolidated net profit was EUR 277 million.
As the result of its speedy and successful rebranding efforts, Belfius was able to regain its commercial strength in 2012. Between the end of 2011 and the end of 2012, there was a 10% increase (+EUR 3.1 billion) in savings deposits. Belfius was also able to fully take on its role as a locally based Belgian banking and insurance group that aims to deliver added value to the community. As a result, almost 10 billion EUR was invested in the local economy in 2012 by the granting of loans.
Between the end of 2011 and the end of 2012, Belfius Bank & Insurance increased its total equity substantially to EUR 5.3 billion (EUR 3.3 billion at 31 December 2011).
This improvement was attributable to
- the reservation of the net profit of EUR 415 million
- a reduction in latent losses of EUR 3.3 billion at the end of 2001 to EUR 1.6 billion at the end of 2012 (AFS reserves)
In addition, loans granted to Dexia (cash exposure) were further dramatically reduced, from EUR 44 billion at the end of December 2011 to EUR 22 billion by the end of December 2012 and again to EUR 15.5 billion at the end of February 2013. Taken in conjunction with the first covered bond issue, this means that the liquidity ratio improved substantially and consequently now complies with all prudential norms. Liquidity management will continue to be extremely cautious.
All of this resulted in the risk profile of Belfius Bank & Insurance improving significantly. Its ratios also improved, as did its solvency position.