Brussels, 19/12/2008 (Agence Europe) - On Thursday 18 December, the European Commission approved emergency recapitalisation worth €3.5 billion that the Belgian authorities intend to grant to KBC Group N.V. The Commission says the recapitalisation is accompanied by the measures necessary to ensure support for the credit market, which is essential if the real economy is to work properly, while minimising distortions of competition.
On 1 December 2008, the Belgian authorities notified their plans to recapitalise KBC Group N.V. with €3.5 billion via a special type of securities. Details of the conditions were communicated to the Commission on 5 and 11 December 2008. The capital injection will increase the tier 1 ratio of KBC Bank to above 10% and the solvency ratio of KBC Insurance to 280%. The aim here is to strengthen the bank's own funds and, thus, reassure the financial markets of its stability. The Commission welcomed the time limits on the proposed measures, and the conditions to encourage the bank turn away from state support as soon as the private credit market is restored. Further information on this matter will be available on the Commission's website, under number N602/2008 as soon as the non-confidential version of the decision is published. (C.D./transl.rt)