2 0 0 3

Andre Bergen, Deputy Group CEO

Strategy update and mid-term value drivers

2

Investor Day

2 0 0 3Overview

KBC, 5 year after take-off : Merger synergies in Belgium Expansion in Central Europe

Going forward : Drivers of future profit growth Mid-term financial objectives Conclusions

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Investor Day

2 0 0 3KBC, 5 year after take-off

We clearly benefited from the synergies of the merger in Belgium

0

500

1000

1500

2000

2500

3000

3500

1998 1999 2000 2001 2002

Life

Non-life

Gross premium income for life and non-life

Revenue synergies : the bancassurance model bearing fruit

In m EUR

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Investor Day

2 0 0 3KBC, 5 year after take-off

We clearly benefited from the synergies of the merger in Belgium

12 000

12 500

13 000

13 500

14 000

14 500

1998 1999 2000 2001 2002 2003 2004

FTE KBC NV, Belgium

Cost synergies accelerated as of end 2001

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Investor Day

2 0 0 3KBC, 5 year after take-off

Highlights, Belgium :

Additional revenue generation from cross-selling of insurance products, mostly to private individuals

Stable to increasing market shares in banking (post-merger emphasis on customer retention)

Since 2001, cost synergies thanks to integrated IT infrastructure and reduction of branches(target of -1 650 FTEs, currently 78% realized)

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Investor Day

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Poland:banking: no 6insurance (L/NL): no 10 / 2

Czech Republic:banking: no 1insurance (L/NL): no 4 / 5

Slovakia:banking: no 4insurance (L/NL): no 7 / 7

Hungary:banking: no 2insurance (L/NL): no 14 / 6

Slovenia:banking: no 1insurance (L): start-up

KBC, 5 year after take-off

We've put ourselves on the map in Central Europe

Market positions for banking and insurance

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Investor Day

2 0 0 3KBC, 5 year after take-off

We've put ourselves on the map in Central Europe

CE: share in group profit and share in allocated capital (excl. group items)

-5%

0%

5%

10%

15%

20%

25%

30%

1998 1999 2000 2001 2002

Share in profit

Share in capital

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Investor Day

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Highlights, Central Europe

We developped solid customer franchises in the 5 ‘main’ countries (worth 1/3 of our market cap)

We introduced gradually the bancassurance modelin each of the countries

We built high-performance IT systems, which are almost completed in the main companies

Earnings accelerated (although 2002 was an adverse year in Poland)

KBC, 5 year after take-off

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Investor Day

2 0 0 3KBC, 5 year after take-off

We gradually adapted the group risk profile

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1998 1999 2000 2001 2002

Corporate and markets

Central Europe

Retail (Belgium)

Allocated capital (excl. goodwill) : share per area of activity

5.4 6.3 6.2 6.7 6.6 bn EUR

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Investor Day

2 0 0 3KBC, 5 year after take-off

Financial track record 1998-2002

0

1 000

2 000

3 000

4 000

5 000

6 000

7 000

1998 1999 2000 2001 2002

Gross revenues

Operating result

Net profit

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Investor Day

2 0 0 3KBC, 5 year after take-off

Financial highlights :

Robust revenue growth 1998-2002 : 13% p.a.

However : slowdown in cost efficiency Since 2001, impact of the adverse economic and

financial climate (cost of risk, value impairments)

As a balance : earnings up 6% p.a.

Sustained rise in DPS, even in difficult market situations (up 8% p.a.)

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Investor Day

2 0 0 3Going forward, earnings drivers

Going forward, investors rightly ask usabout the catalysts for future growth

The right question :

13

Investor Day

2 0 0 3Going forward, earnings drivers

from a mid-term perspective, the best way to secure the highest level of shareholder value

is to intensify the current strategic approach

The clear answer is :

(strategy horizon : 2003-05)

14

Investor Day

2 0 0 3Going forward, earnings drivers

Independent, how should we allocate our resources to earn the highest return? Strengthen current market presences? Develop new markets in (Central- or) Eastern-Europe? Develop new markets in Western-Europe? Develop new markets elsewhere?

To our analysis, building on our current market presences

is the option with the highest yield potential. In this regard, we feel confident that the current allocation of capital and management resources is the right way forward.

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Investor Day

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Main assets for revenue enhancement :

In Belgium : Developing the untapped cross-selling potential

of insurance products (primarily for SMEs and non-life)

Going forward, earnings drivers

Market share insuranceMarket share bankingNon-life: 8%Non-linked life:- individual: 12% - group: 4%Unit-linked life: - individual: 21% - group: 2%

22% 11%

Market situation as of Dec 31, 2002

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Investor Day

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Main assets for revenue enhancement :

In Central Europe : Deepening product penetration of banking and asset

management products (cards, mortgages, funds, etc.)

Leveraging the bancassurance business model (increased sales of insurance products)

If acquisition opportunities arise, e.g. meeting the 10% market share objective in Hungary (insurance) and Poland (banking)

Going forward, earnings drivers

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Investor Day

2 0 0 3

Milestones in productivity enhancement and cost control :

In Belgium (mainly in banking) :

Completing the bank merger> By 2004, downsizing will equal 12 % of the 2001 headcount

Optimizing the branch network concept (clustering)

Rolling out efficiency-improvment programs (back offices)

Going forward, earnings drivers

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Investor Day

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Milestones in productivity enhancement and cost control :

In Belgium (cont’d):

Intensively marketing e-bancassurance

Going forward, earnings drivers

0

50 000

100 000

150 000

200 000

250 000

300 000

350 000

2000 2001 2002 2003

Active subscribers to KBC's internet and PC banking facilities (Belgium)

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Investor Day

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Milestones in productivity enhancement and cost control :

In Central Europe: Reorganizing business processes

(front-end automation at advanced stage) Cross border cost-sharing projects

(payments systems, IT procurement, etc.)

> By 2005, we expect 2002 headcount could be reduced by 10-15 %

Going forward, earnings drivers

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Investor Day

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Milestones in productivity enhancement and cost control :

In general : Enhancing portfolio quality and controlling cost of risks

Going forward, earnings drivers

50%

52%

54%

56%

58%

60%

62%

64%

66%

68%

1999 2000 2001 2002 Benchmark

Loss ratio non-life (*) Loss ratio credit portfolio

0.00%

0.10%

0.20%

0.30%

0.40%

0.50%

0.60%

0.70%

1999 2000 2001 2002 Benchmark

* excl. reinsurance

Poland

21

Investor Day

2 0 0 3Mid-term financial objectives

Targets unchanged, although ambitious and highly sensitive to the uncertain economic environment

Achieved2002

Minimumtargets 2005

ROE, Group 13% 13% 16%EPS growth (4y CAGR) 6% 2% 10%

Cost/income ratio, banking 71% 65% 58%

Combined ratio, insurance (excl. re-insurance)

100% 101% 95%

Tier-1, banking 9% 9% 8%

Solvency, insurance 504% 320% 200%

Achieved2001

22

Investor Day

2 0 0 3Mid-term financial objectives

Share incapital 2002

Minimum return 2005

Retail bancassurance 34% 13% 16%

Central Europe 27% 5% 17%

Asset management - - -

Services to corporates 25% 9% 12%

Market activities 14% 7% 18%

Achievedreturn 2002

Return on allocated capital

23

Investor Day

2 0 0 3Conclusion

Course set for the mid-term future :

> In order to enable our shareholders to benefit from solid EPS growth and a robust ROE level : Concentrating (even more) on the bancassurance

potential in Belgium and Central Europe Heading for lower level of expenses and cost of risks