KBC Bank said it will look at buying bank or insurance businesses here after taking a decision to remain in the Irish market.

Ulster Bank and Permanent TSB have long been tipped as potential tie-up partners for KBC Ireland. A merger with one or both would add scale to the business here, which is dwarfed by AIB and Bank of Ireland.

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Alternatively, a takeover of an insurance provider such as FBD, the country's only stand alone insurer, could replicate the bank-assure model of KBC'S parent.

KBC Group ceo Johan Thijs said no deals are imminent but acquisitions will be looked at carefully, on a call with investors.

"If the opportunity arises (to buy an Irish bank or insurance business) we will do our homework," he said.

The Belgian owned bank confirmed its “long term commitment” to Ireland this morning following a strategic review of its Irish activities.

Weeks of intensive speculation about its future had weighed on its 1,000 employees.

The results of a strategic review of KBC Group’s Irish activities were announced this morning as it revealed its quarter 4 and full financial results for last year.

KBC Bank Ireland reported a net profit of €227m for the year, after tax and impairment, up from €75m in 2015.

The bank reported some 20,000 new customers in the last three months of 2016, bringing to 70,000 the total added in 2016.

The bank also reported a “continued momentum” in reducing the number of its mortgage arrears cases.

Commenting on the financial results and 2017 outlook, Wim Verbraeken, Chief Executive of KBC Bank Ireland said he was pleased to report on “a very successful 2016”.

“I also welcome KBC Group’s decision to commit to the future of the Irish business and our customers here by making Ireland one of its core markets,” said Mr Verbraeken.

“Today’s announcement is fantastic news for KBC customers and staff, and will result in more competition in Irish banking and better choice for customers. KBC has been here for over 40 years, we’ve invested heavily through the recent challenging period, built a strong and compelling retail bank, and are looking forward to becoming the main challenger bank here.”

Mr Verbraeken told Newstalk Breakfast that he believes KBC can grow "organically".

"Our first priority is to grow our business organically.

"We're not concerned at all about the loan performance. We've put implementations in place to help customers who are in distress and deal with their problems and in the vast majority of cases, we find a way out. I invite customers who are in distress to engage with us."

Johan Thijs, KBC Group CEO, said KBC Bank Ireland will be the “customer-centric bank of the future where digitalisation will support a great customer experience”.

“The Bank managed to return to profitability as soon as 2015, earlier than we had anticipated and on the back of the encouraging turnaround they achieved strong results for financial year 201,” said Mr Thijs.

“We believe Ireland is a sound and attractive market which presents opportunities and in which we wish to play a more active role. It provides diversification to our operations in Western and Central Europe.

“Going forward, Ireland will be a core market in which KBC will continue to invest. The Bank will be a frontrunner in the digital transformation of the KBC Group where digital solutions will be tested for further group-wide roll-out. We believe we have the people in Ireland with the right skills, the energy and determination to do this and we are ready to support them. In the medium and long-term this customer-centric approach will result in a sustainable future-proof business model and financial results for KBC Bank Ireland, to the benefit of its customers, staff and all other stakeholders.”

The Minister for Finance Michael Noonan welcomed the announcement.

"This is another strong sign of the recovery in Ireland and shows confidence by KBC Ireland in the Irish economy."

"The fact that KBC is committed to remaining in Ireland ensures continuing competition in the Irish banking market which is good for consumers. Such commitment is also a mark of the robust market and of its continuing growth potential into the future."

Minister Noonan will be meeting with senior officials of the bank this afternoon and looks forward to hearing in more detail about their future plans to support customers in this growing area of the Irish economy.

Online Editors