KBC Group

Sanford Bernstein ConferenceMerrill Lynch Conference

28 September 2005 - 5 October 2005

Web site: www.kbc.com

2

This presentation is provided for informational purposes only and does not constitute an offer to sell or the solicitation of an offer to buy any security

KBC believes that this presentation is reliable, although some information may be condensed or incomplete

This presentation contains forward-looking statements with respect to our earnings development involving assumptions and uncertainties. The risk exists that these statements may not be fulfilled and that future results differ materially.

By receiving this presentation, each investor is deemed to represent that it possesses sufficient expertise to understand the risks involved

Important information

3

Introduction: strategic framework

The strategic framework entails: Focused business scope:

Retail-, bancassurance- and wealth-management-oriented Geographical focus on Belgium and CEE and selected Western European markets

Standalone basis: no M&A ambitions (neither domestic, nor cross-border - neither as acquirer, nor as

target) however, opportunistic operational alliances possible in certain areas to generate

cost advantages through scale (‘industralization’ of operations) Solid level of financial strength/solvency Attractive shareholder return, including steady dividend growth

4

55%25%

20%

Introduction: business mix

KBC is a top bancassurer and asset manager in Belgium and has successfully expanded its operations in CEE-5, its 2nd home market

Recently, private banking has become more of a key focus. The PB business was expanded to include a Western European network.

Revenu - geographical breakdown(1H 2005)

Belgium:- retail bancassurance- asset management- private banking- commercial banking (SME/corporate)

CEE:- retail bancassurance- asset management- private banking- commercial banking (SME/corporate)

Selected other markets (mostly in W. Europe):- private banking- commercial banking (SME/corporate)- capital markets

5

Business mix: growth profile

Main facts: 70% of gross income is realized in markets with leading market positions (i.e. Belgium

and most CEE countries) An increasing share of income (currently 30%) is generated in high-growth markets (CEE)

Key strategic topics: Topic 1: securing growth trend in (mature) Belgian market, given its size Topic 2: further increasing share in high-growth markets, inter alia, by boosting market

power in countries where KBC has sub-optimal scale (mainly Poland)

LO

W

Market growth potential

LOW HIGH

PrivatebankingBelgium

RetailBelgium

Commercial banking Belgium

Slovenia

Czech Rep.

Hungary

Poland

HIG

H

Slovakia

Ma

rke

t s

ha

re

Internationalcommercial

banking

Europeanprivate banking

Based on KBC estimates

6

Business mix: value profile

LO

W

Allocated capitalLOW HIGH

Private banking Belgium

Retailbancassurance

Belgium

Commerial bankingBelgium

BancassuranceCEE

HIG

H

Re

tun

on

all

oc

ate

d c

ap

ita

l

International commercial banking

Europeanprivate banking

Based on selective 1H2005 data, adjusted for one-offs

Main facts: 85% of capital employed is allocated to businesses yielding 20% or more (roughly twice

the cost of capital) – no activity is value-destroying On the other hand: 15% of total capital base (2.3 bn) is ‘immediate free surplus’ capital

Key strategic topics: Topic 3: shifting European private banking into much higher gear Topic 4: adequately employing excess capital

7

Do not underestimate market potential: KBC Group is well positioned:

Savings ratio amongst highest in the world (every year, ca. 15% of GDP flows into fin. assets)

Market highly receptive to cross-selling of AM & insurance, fueling strong growth trend in AM and life insurance business

Strong mortgage growth trend (ca. 10% per year) expected to continue, as residential property price levels are still below other European markets

After a temporary surge of price competition (late 2004/early 2005), epecially for interest-bearing products, pricing rationality is tending to be restored

Fee rates for retail banking services only 50% of European average (gradual increase expected)

Top-3 market position, esp. strong in Northern region (one of the wealthiest regions in the EU)

Innovative product offering in retail AM (steadily increasing market share over the past 10 yrs.)

Still high cross-selling potential for insurance products and well-performing bancassurance distribution model

Well-diversified revenue structure (50% fee income) and further increase in fee income targeted (e.g. in SME/corporate)

Of the top players, level of customer satisfaction is high(est)

Topic 1: drivers for growth, Belgium

8

Mid-term financial outlook, Belgium

Gross income C/I, banking LLR Net profit

Retail 5% CAGR Low 60s < 0.25% >10% CAGR

Business customers >2% on RWA < 43% < 0.35% >10% CAGR

9

Strong market-growth momentum: KBC Group is well positioned:

Topic 2: growth drivers in CEE

Nom. GDP growth in 2005-07 at 6.5% yearly, outgrowing EMU by 3-3.5%

Ongoing catch-up in product penetration (currently, on avg., only 45% of the population has a bank account and 5% a mortgage loan)

Mortgage volumes growing at double-digit pace (up by 32%, annualized, in 1H05)

Financial sector could grow five-fold if financial assets to GDP were to reach current levels of S. Europe

Solid market position in retail and corporate businesses with nationwide branch networks

Competitive advantage in enhancing cross-selling of asset management and insurance products and well positioned in HNWI and private banking through epb know-how

Availability of capital within the Group for: buy-out of third-party interests or

selective bolt-on M&A more aggressive organic growth in

Poland since immediate M&A opportunies are not expected

Potential entrance into Romanian market

10

Bancassurance fueling CEE earnings

KBCCross-sell

rates2004

CZ HU PL SK BE

Consumer loan

XLife

83% 50% 100% 94% 67%

Mortgage loan

XLife

45% 50% 100% 75% 67%

Mortgage loan

XProperty

insurance

54% 71% 42% 30% 50%

Now the model is in place:

Transfer of know-how and streamlining of business processes and IT systems

Implementation of KBC’s distribution model and setting up of sales incentives and adequate sales approach

Unified management responsibility (joint management committee of bank and insurance)

= competitive advantage relative to other CEE players

Cross-selling results are encouraging:

11

Growth in AM fueling CEE earnings

KBC is well positioned:

Strong appetite for ‘risk-free’ investments in the market, fully in line with KBC’s core competencies and successful track record in Belgium for capital-guaranteed funds

Cost/AUM below average (around 15 bps vs. 20 bps for Europe)

= competitive advantage relative to other CEE players

Results are encouraging:

AUM grew in 1H05 by 40%, annualized. Continued high growth expected in coming years

Via the funds business, new customers are being recruited. Existing customers who use deposits to buy funds replenish their deposit accounts after one year

Market share

2003 2004 1H05 Trend

CZ 19% 22% 26% +++

HU 8% 9% 11% ++

SK 6% 7% 8% +

SLO - 8% 10% ++

PL 3% 4% 4% +

12

Mid-term financial outlook, CEE

RWA CAGR

Net profit CAGR

Loan-loss ratio

Cost/Incomeratio

Banking 10% – 15% 10% – 15% < 0.50% < 60%

Premium income CAGR

Net profit CAGR

Combined ratio

Insurance 15% – 25% 25% - 35% 95%

AUM growth, mutual funds

AUM growth, pension producs

AM 15% – 20% 10% - 20%

13

Topic 3 : value drivers in private banking

Dual brand strategy: network-led vs. ‘independent boutique’

Growth drivers: network trade-up, extension of product offering and hiring of private bankers

Business model: integrated private banking business in selected European markets focusing on clients with >€1m of investable assets. The network has been built over the past few years via separate acquisitions. Operations need to be further integrated. Total assets currently amount to 76 bn (Sep-05)

Integrated network of local pure-play private banking brands (boutique style)

Priority of reducing costs by creating synergies within a central ‘hub’

Growth drivers: increased share of wallets, hiring of PB managers and opportunistic M&A

Low-growth market, focus on profitability (leveraging the hub)

If possible, steer repatriated assets to KBC onshore

Small today, but strong market growth expected (>15% p.a.)

Strengthening a network-led model, leveraging Belgian experience

Belgium W. Europe onshore W. Europe offshore CEE

AUM expected to growth at 9% CAGR on an organic basis.

Opportunistic acquisitions may imply investments of 150-250 m per year

AUM 28 bn

AUM 27 bn

AUM 18 bn

AUM 3 bn

14

€m

* Synergy benefits defined as peak recurring annual increase in pre-tax bottom-line result (2009 - peak level)

16.7

12.6

27.7

74.6

12.6

3.9 1.0

0

10

20

30

40

50

60

70

80

Cross sales

Newbusiness

Optimi-zation

Pro-cure-ment

People

Source of benefits*

Costsavoided

Total

The KBC-Almanij merger enables synergies to be achieved via cost-cutting and cross-selling.The total benefit amounts to 75 m euros (pre-tax) per year (50% will already be realized as of 2006)

Merger synergies in private banking

15

The private banking hub

Centralized global custody services, processing/settlement of international payments and processing of financial market transactions (for all major asset classes i.e., Cash, Bonds, Equities, Funds, Structured Products)

Full harmonization of major IT tools Front-office support: product sourcing and

design capability and ‘Centres of Excellence’

Back office: great majority of local back-office costs eliminated

Dealing rooms: a minimum level of local market activities will remain

IT: only local IT support will remain

Significant reduction in other overheads

Organizational impactOur endgame vision of the hub

Cost/income ratio to be improved from 67% (2004) to 55%

16

Mid-term financial outlook, private banking

AUM growth Net profit Cost/Income

Private Banking 9% CAGR * 10% CAGR < 55%

*14% Belgium, 15% CEE, 0% offshore and 10% W. Eur. onshore

17

Topic 4: valuing excess capital

Capital position

Available capital 1

Surplus capital 2

Immediatefree surplus 3

Total 14.7 bn 4.3 bn 2.3 bn

Internal capital budget requirements

Deleveraging of the holding company 0.4 – 0.6 bn

Buy-out of 3rd parties in CEE 0.8 – 1.3 bn

External growth in CEE 1.0 – 2.0 bn

Total 2.2 – 3.9 bn

1 Regulatory capital under Basel I/Solvency I (incl. hybrids and minority interests, after elimination of intangibles and goodwill), based on capital position as at 30/03/20052 Difference between available capital and internal minimum level3 Surplus capital excl. expected adverse IFRS impact on Tier-1 banking as of 2006 (ca. 0.6 bn), unrealized gains on tied-up assets (insurance, 0.8 bn) and value of Agfa-Gevaert

Immediate free surplus capital amounts to 2.3 bn, primarily to be spend in CEE

KBC currently conducting ‘due diligence’ for BCR in Romania. Outcome expected to be known in the coming months

18

Conclusion: growth and value proposition

LO

W

Market growthLOW HIGH

PrivatebankingBelgium

RetailBelgium

Commercial banking Belgium

Slovenia

Czech Rep.

Hungary

Poland

HIG

H

Slovakia

Ma

rke

t s

ha

re

Internationalcommercial

banking

Europeanprivate banking

Based on KBC estimates

Selective approachEfficiency enhancement

Third-party buy-outsAcceleration of bancassurance/AM

Assessment of entrance into Romania (by end 2005)

Higher share of walletHigher margin products

Organic growth accelerationM&A (mid-term)

Attractive growth and value proposal within current franchises.

Main focus is on execution - shift to completely new markets/business lines unlikely

Use of excess capital highly dependent on outcome of privatization round in Romania

19

Conclusion: growth and value proposition

The ‘growth and value’ outlook is reflected in ambitious mid-term financial targets:

Outlook for 2005: On the basis of the solid 1H 05 earnings and the prevailing view regarding the relevant economic and financial parameters, KBC’s 2005 net profit isexpected to exceed the10% growth level, amounting to more than 2 bn euros

Efficiency: Cost/income, banking

Combined ratio, non-life

max. 58%

max. 95%

Financial strength:

Tier-1, banking

Solvency margin, insurance

min. 8%

min. 200%

Value creation: Adjusted ROE

EPS growth (CAGR)

min. 16%

min. 10%

AppendicesFoto gebouw

21

Market cap ranking in Euroland

1 BSCH (63 bn)2 BNP Paribas (53 bn)

3 BBVA (47 bn)

4 Deutsche Bank (39 bn)

5 Société Générale (39 bn)

6 ABN AMRO (37 bn)7 Crédit Agricole (33 bn)

8 Fortis (31 bn)9 Unicredit (29 bn)

10 KBC (25 bn)

11 Intesa BCI (23 bn)

12 Dexia (20bn)

13 San Paolo IMI (18 bn)

14 HVB (17 bn)

15 Allied Irish Banks (16 bn)16 Bank Austria (13 bn)

17 Commerzbank (13bn)

18 Mediobanca (12 bn)

19 Bank of Ireland (12 bn)

20 Bco Popular (12 bn)

August 2005

DJ Euro Stoxx Banksconstituents

22

Shareholder structure

CERA/Almancora27.1%

(own shares: 2.3%, including ESOP hedge)

Other committed shareholders 11.7%

MRBB11.6%

Free float47.3%

KBC is majority-owned by a group of committed shareholders, thereby providing continuity for the pursuit of long-term strategic goals

Core shareholders include the Cera/Almancora Group (co-operative investment company), a farmers’ association (MRBB) and a syndicate of industrialist families

Situation as at 30 June 2005

23

2005 H1

25%

KBC’s presence in CEE

CEE profit contribution to KBC Group

Retail 57%

Other22%

SME/Corp 21%

Share of business segments in gross income, CEE Banking

Profit contribution, CZ + SK

2003 2004

143 m 162 m

Czech Republic

Total assets, bank: 18 bn EURMarket share, bank: 21% (No. 2)Market share, life: 8% (No. 5)Market share, non-life: 4% (No. 6)

Profit contribution, Poland

2003 2004

-295 m 25 m

Total assets, bank: 5 bn EURMarket share, bank: 5% (No. 8)Market share, life: 3% (No. 7)Market share, non-life: 11% (No. 2)

Profit contribution, Hungary

2003 2004

11 m 31 m

Total assets, bank: 7 bn EURMarket share, bank: 11% (No. 2)Market share, life: 4% (No. 7)Market share, non-life: 4% (No. 6)

Slovakia

Total assets, bank: 2 bn EURMarket share, bank: 6% (No. 4)Market share, life: 4% (No. 8)Market share, non-life: 2% (No. 7)

Profit contribution, Slovenia

2003 2004

10 m 26 m

Minority stake (34%)Market share, bank: 41% (No. 1)Market share, life: 6% (No. 5)

24

Group income statement, 1H 2005

(in m euros) Banking Insurance AM KBL epb Gevaert Holding Group

Net interest incomeGross earned premium, insuranceDividend incomeNet gains from FI at FV Net realised gains from AFS assetsNet fee and commission incomeOther income

1 8070

67121

63605223

2661 707

864

144-148

29

-10781

1841

7907

8221

20633

-203

1437

049

-3000

-40

-2235

2 1221 707

169225265839330

Gross income 2 887 2 088 199 429 101 200 5 660

Operating expensesImpairments - o/w on loans and receivables - o/w on AFS assetsGross technical charges, insuranceCeded reinsurance resultShare in results, associated companies

-1 685-34-34

100

17

-254-20

-1-18

- 1464-33

0

-30000000

-287-501002

-4211100

15

-257000000

-2 313-57-34-16

-1 464-3333

Profit before taxes 1 185 316 169 137 75 -57 1 826

Income tax expense

Minority interests

-306-96

-66-4

-430

-39-4

-12-1

-20

-469-104

Net profit 784 246 126 94 63 -59 1 253

Excl. intrasegment eliminations

25

Areas of activity overview, 1H 2005

(in m euros) Retail CEE SME/Corp.

Markets KBL epb Gevaert Total

Banking and AM

Gross incomeOperating expensesImpairmentsIncome tax expenseMinority interestsNet profit – group share

1 288-734

+7-178

0383

925-526

-7-71-41282

508-183

-34-84

0208

410-235

-2-67

0106

429-289

-5-39

-494

3 515-2 004

-39-415-100

1 003

Insurance

Gross income (- tech. chg.)Operating expensesImpairmentsIncome tax expenseMinority interestsNet profit – group share

373-156

-15-46

-1155

131-83

-1-10

-730

47-15

-4-10

017

591-254

-20-66

-4246

Holding Co

Net profit – group share 63 3

Group total

Net profit – Group shareShare in group resultROAC

53943%29%

31225%54%

22518%20%

1068%

28%

948%

16%

635%

11%

1 253

20%

Excl. non-allocated results

26

Valuation

weighted P/E 2005-06

unweighted P/E 2005-06

CEE banks 2 15.0 15.1

CEE-exposed banks 3 11.6 12.4

Euro-zone banks 4 11.5 12.4

KBC 1 10.9 10.9

BEL banks 5 10.3 10.4

Key figures: Share price: 66.6 euros Net asset value: 40.0 euros 1H 2005 EPS: 3.50 euros

Analysts’ estimates: 1

2005 EPS consensus: 5.97 (+33% y/y) 2006 EPS consensus: 6.24 (+4% y/y) 2005-06 P/E: 10.9

Recommendations: Positive: 42% Neutral: 42% Negative: 16%

Valuation relative to peer group:

Weighted and unweighted averages of IBES data :2 OTP, Komercni, Pekao, BPH PBK, BRE3 BA-CA, Erste, Unicredit, Soc. Gen., Intesa BCI4 Top-20 DJ Euro Stoxx Banks 5 Fortis, Dexia

Situation as at 18 August 2005

5 Smart consensus collected by KBC (18 estimates)

27

Contact information

Investor Relations Office

Luc CoolNele KindtMarina Kanamori

investor.relations@kbc.com

Surf to www.kbc.com for the latest update.