KBC Groep NV investors Cera CVBA and KBC Ancora CVA are selling a combined 18.8 million shares of Belgium’s biggest bank by market value to reduce shareholder loans that have to be deducted from KBC’s regulatory capital.
Cera is selling 14.1 million KBC shares, or about 56 percent of its holding, according to an e-mailed statement today. Leuven, Belgium-based KBC Ancora is offering 4.7 million shares, or about 5.7 percent of its holding, according to a separate statement. Goldman Sachs Group Inc. is managing the sale of the shares, which are being offered at 39.15 euros to 40 euros apiece, according to terms obtained by Bloomberg News.
Cera and KBC Ancora said they will use proceeds from the placement to buy back 425 million euros of term loans due in 2017 and repay additional short-term debt provided by KBC Bank NV as upcoming Basel III capital rules require KBC to deduct loans provided to shareholders from its regulatory capital. Both investors are paring their stake after KBC rallied to a five-year high in Brussels trading last week.
“KBC Ancora remains the largest shareholder of KBC Groep after the transaction and will continue, together with Cera and the other stable shareholders, its role in ensuring the shareholder stability of the group,” KBC said in a statement.
The elimination of the shareholder loans will add 0.7 percentage points to KBC’s common equity ratio of 12.5 percent currently, assuming full application of the Basel III capital rules. KBC Bank already transferred 325 million euros of KBC Ancora loans to a third party in July following calls from Belgium’s bank regulator to reduce the shareholder loans before approving a reimbursement of state aid.
KBC will retain a 18.6 percent stake and Cera’s holding will shrink to about 2.7 percent following the placement. That will reduce the combined stake of the shareholder syndicate consisting of KBC Ancora, Cera, the Belgian farmers’ union and a dozen Flemish families to about 43.8 percent, according to KBC.