KBC Group (KBC) Q1 2026 earnings summary

Executive summary

• Net profit for 1Q2026 was €557 million, up 2% year-over-year but down from €1,003 million in 4Q2025, reflecting seasonality and the impact of annual bank and insurance taxes booked in Q1.

• Achieved a return on tangible equity of 16% and return on equity of 14%, with strong performance from both banking and insurance franchises.

• All business segments and countries contributed positively, with strong diversification between banking and insurance.

• Integration of 365.bank and Business Lease completed, contributing €13 million to profit and impacting capital ratios.

• Digital innovation advanced, with AI-powered assistant Kate reaching 6.1 million users and new crypto investment solutions launched.

Financial highlights

• Net interest income increased 4% quarter-on-quarter and 18% year-on-year to €1,672 million; net interest margin rose to 2.17%.

• Net fee and commission income up 1% quarter-on-quarter and 6% year-on-year; assets under management at €295 billion, up 8% year-on-year.

• Customer loans grew 2% quarter-on-quarter and 7% year-on-year; deposits up 3% year-on-year (excluding volatile short-term deposits).

• Combined ratio in non-life insurance at 84%; life insurance sales up 9% quarter-on-quarter and 15% year-on-year.

• Operating expenses (excluding taxes) were €1,214 million, down 1% quarter-on-quarter but up 10% year-on-year.

• Loan loss impairment charges rose to €164 million, including a €75 million reserve increase for geopolitical risks.

• Liquidity and capital positions remained strong: LCR at 159%, NSFR at 135%, CET1 ratio at 14.4%.

Outlook and guidance

• FY2026 guidance: organic total income growth at least 6.8%, net interest income at least €6.5 billion, organic loan growth at least 5%, insurance revenues up at least 7.5%, cost/income ratio below 40%, combined ratio below 91%, credit cost ratio well below 25–30 bps.

• Medium-term (2025–2028) CAGR targets: total income +7.7%, net interest income +8.6%, insurance revenues +7.5%.

• Dividend payout policy remains at 50–65% of consolidated profit, with a minimum CET1 ratio target of 13%.

• Expectation to update guidance in Q2 as the impact of the Middle East conflict becomes clearer.