KBC’s Antwerp Diamond Bank to Shut U.S. Office, CEO Says

Antwerp Diamond Bank, a unit being sold by KBC Groep NV (KBC), plans to shut its office in New York within six months, as potential acquirers prefer emerging markets over the U.S.

The closure, announced to clients today, is “linked to the ongoing negotiations” with possible buyers of the diamond bank, Pierre De Bosscher, chief executive officer of the unit, said in an interview. The focus of these investors is on markets in “the Far East and Middle East” rather than the U.S., he said.

“What this news suggests is that ADB is getting closer to selling its diamond division, since a potential buyer is beginning to influence the bank’s decisions,” said Anish Aggarwal, a partner at industry consulting firm Gemdax.

Antwerp Diamond Bank is the last unit of KBC set to be sold under conditions imposed by the European Commission for the parent receiving state aid in 2008 and 2009. After KBC missed the end-2012 deadline to sell the unit, the commission, the European Union regulator in Brussels, appointed a trustee to oversee the divestment along with KBC.

KBC said on Nov. 14 that it wrote down the value of the diamond bank by 73 million euros ($99 million) in the third quarter, and the unit represented 1.5 billion euros in risk-weighted assets.

The U.S. office, which employs five people, will be shut “softly,” De Bosscher said. The bank’s remaining offices are “not in danger,” he said. Besides its home city in Belgium, Antwerp Diamond Bank also has offices in Hong Kong, Mumbai, Singapore and Dubai.

To contact the reporter on this story: Andrew Clapham in Brussels at aclapham@bloomberg.net

To contact the editor responsible for this story: Jerrold Colten at jcolten@bloomberg.net

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