(16/12/2005) KBC Group confirms its long-term strategy, establishes a new organizational structure and launches a

Following a proposal by the Executive Committee, the Board of Directors of KBC Group reaffirmed its long-term vision and approved the corresponding new organizational structure of the Group. At the same time, the Board of Directors decided to repurchase and cancel 1 billion euros' worth of KBC's own shares in 2006. A variety of projects will be launched to safeguard growth in the future. The following are being considered: ° further consolidating the bancassurance model, reinforcing organic growth (including extending the branch network), enhancing the provision of services to corporate and affluent customers, and strengthening the consumer finance business in Central and Eastern Europe; ° buying out shareholders in Central and Eastern Europe and eventually acquiring a second Polish bank and a second Hungarian insurance company; ° continuing to explore acquisition or greenfield opportunities in the Romanian market and the Balkans; ° enhancing non-life insurance distribution on the Belgian market via brokers and developing new long-life insurance products. All the projects fit in with and will strengthen the existing strategy, which means that KBC will continue to concentrate on its core businesses (i.e. it will remain a bancassurer specialized in the retail/SME and mid-cap segments and operating on selected markets). The projects will allow KBC to make the most of the trumps it has in hand, namely its knowledge of distribution and lean operations. Indeed, KBC has extensive know-how in the field of multi-channel distribution and is looking to enhance this even further. What is more, many of its processes are already being run efficiently. All the projects can be carried out using own funds and there will be surplus capital left over. This is the reason why the Board of Directors at KBC has decided to repurchase and cancel 1 billion euros' worth of KBC's own shares in 2006. The full text of the press release is available on www.kbc.com and on www.companynewsgroup.com © CompanynewsGroup