annual report 2010/2011
DESCRIPTION
Annual Report 2010/2011TRANSCRIPT
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KBC Ancora
Legal form: Civil company having taken the form of a
partnership limited by shares
Registered office: Philipssite 5/10, 3001 Leuven, Belgium
Company number: 0464.965.639
Website: www.kbcancora.be
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C O N T E N T S
letter from the Chairman of the Board of Directors and the Managing Directors 7Declaration by the responsible individuals 9Declaration in connection with risks 9
1 Investor information 101.1 Share price, discount and traded volumes 101.2 Key figures as at the balance sheet date 14
1.2.1 Balance sheet and result 141.2.2 Cash flow table 151.2.3 Dividend 16
1.3 Distribution of KBC Ancora shares 171.3.1 KBC Ancora shareholdership 171.3.2 the road to the market 17
2 Declaration concerning effective corporate governance 182.1 Group structure 18
2.1.1 Almancora ASBl 182.1.2 Almancora Société de gestion SA 192.1.3 Ancora ASBl 192.1.4 KBC Ancora SCA 19
2.2 effective corporate governance 202.2.1 Management structure 202.2.2 Board of Directors of Almancora Société de gestion SA 21
2.2.2.1 Composition of the Board of Directors 242.2.2.2 powers of the Board of Directors 252.2.2.3 Functioning of the Board of Directors 26
2.2.3 Committees appointed within the Board of Directors 272.2.3.1 Day-to-Day Management Committee 272.2.3.2 Audit Committee 272.2.3.3 Appointments Committee 292.2.3.4 Remuneration Committee 30
2.2.4 Auditor 302.3 Main features of the evaluation process for the Board of Directors, its committees
and its individual members 312.4 Remuneration report for the financial year 2010/2011 312.5 Internal control and risk management 362.6 Rotation system 362.7 Code of conduct in respect of conflicts of interest 37 2.7.1 potential conflict of interest with the statutory manager 37 2.7.1.1 establishment of conflict of interest by Board of Directors of
Almancora Société de gestion SA 37 2.7.1.2 Decision of ad hoc representative: Board of Directors of Ancora ASBl 37 2.7.1.3 Cognisance of the decision of the ad hoc representative of the Board of
Directors of Almancora Société de gestion SA 39 2.7.2 potential conflict of interest between directors/members of the Day-to-Day
Management Committee of Almancora Société de gestion and KBC Ancora 39
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2.8 Code of conduct to prevent market abuse 392.9 notification in implementation of Article 34 of the Royal Decree of 14 november 2007
concerning the obligations of issuers of financial instruments that are admitted to trading on a regulated market 40
2.10 Annual notification pursuant to Article 74, §8 of the law of 1 April 2007 on public takeover bids 40
2.11 Guidelines for the exercise of directorships 402.12 openness in investor communication 41
3 Statutory manager’s report 423.1 Balance sheet as at 30 June 2011 42 3.1.1 Assets 42 3.1.2 liabilities 423.2 profit and loss account for the financial year 2010/2011 43
3.2.1 Income 433.2.1.1 Income from financial fixed assets 433.2.1.2 other income 43
3.2.2 expenses 433.2.2.1 Costs within the cost-sharing association with Cera 443.2.2.2 Costs of debt 453.2.2.3 other operating costs 453.2.2.4 taxes 45
3.3 Result and proposed appropriation of the result 453.4 legal proceedings 453.5 Additional information 463.6 no consolidated financial statements for KBC Ancora 463.7 Most recent financial year and available information for 2011 on KBC Group 46
3.7.1 past financial year of KBC Group 46 3.7.2 First half of KBC Group financial year 2011 503.8 outlook for the financial year 2011/2012 52
4 Financial report 544.1 Balance sheet 544.2 profit and loss account 564.3 notes 574.4 Valuation principles 604.5 Auditors’ report 62
5 Colophon 64
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L i S T O f C h A R T S
Chart 1: trend in KBC Ancora and KBC Group share price during the last financial year 10
Chart 2: trend in discount of the KBC Ancora share relative to its intrinsic value over the
last financial year, in relative terms 11
Chart 3: traded volumes of KBC Ancora shares on a daily basis over the past financial year 11
Chart 4: trend in KBC Ancora and KBC Group share prices relative to Bel20 index in the
past financial year 12
Chart 5: trend in KBC Ancora and KBC Group share prices relative to Dow Jones euRo
StoXX Bank index in the past financial year 13
Chart 6: Group structure 18
Chart 7: trend in (underlying) KBC Group profit 50
L i S T O f TA B L E S
table 1: Summary of stock market figures in the most recent financial years 12
table 2: Key figures as at balance sheet date 14
table 3: Results for the most recent financial years 15
table 4: Cash flow table for the most recent financial years 15
table 5: Composition of the Board of Directors of Almancora Société de gestion SA and
overview of individual attendances 23
table 6: Remuneration of non-executive directors of Almancora Société de gestion 34
table 7: Remuneration of Day-to-Day Management Committee of KBC Ancora 35
table 8: trend in KBC Ancora income 43
table 9: trend in KBC Ancora costs 44
table 10: Costs within the cost-sharing association with Cera 44
table 11: profit figures and key ratios of KBC Group for the financial years 2010, 2009
and 2008 49
table 12: profit figures of KBC Group for the first half of the financial year 2011 and 2010 52
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B O A R D O f D i R E C T O R S O f A L m A N C O R A S O C i E T é D E G E S T i O N S A
left to right:
Ghislaine Van Kerckhove
Franky Depickere
Jean-François Dister
Peter Müller
Herman Vandaele
Luc Discry
Cynthia Van Hulle
Johan Massy
Katelijn Callewaert
not on the picture:
Léopold Bragard
Jos Plessers
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L E T T E R f R O m T h E C h A i R m A N O f T h E B O A R D O f D i R E C T O R S A N D T h E m A N A G i N G D i R E C T O R S
KBC Ancora recorded a profit of EUR 30.2 million in the financial year 2010/2011, compared with a loss of
EUR 30.5 million in the preceding financial year.
After two years of not distributing a dividend, KBC Group distributed a dividend of EUR 0.75 per share
in may 2011 in respect of the financial year 2010. As a result, KBC Ancora received income of EUR 61.7
million from its participating interest in KBC Group, which remained unchanged from the previous year
(82.2 million shares, or 23% of the total number of KBC Group shares in issue).
Costs (EUR 31.5 million) consisted principally of interest charges (EUR 29.4 million) and operating costs (EUR
2.1 million).
As already announced, KBC Ancora is not distributing a dividend in respect of the year under review, because
the profit for the year is insufficient to cancel out the entire loss carried forward from previous financial years
(EUR 59.8 million). The remaining loss carried forward at the end of the financial year 2010/2011 amounted
to EUR 29.7 million.
KBC Ancora used the net operating cash flow in the year under review (EUR 30.2 million) to reduce the
financial liabilities.
During an Extraordinary General meeting of Almancora Société de gestion, statutory manager of KBC
Ancora, held on 29 October 2010, Katelijn Callewaert and herman Vandaele were appointed as new
independent directors (C directors).
On 9 August 2011, KBC Group announced results for the first half of the financial year 2011 totalling EUR
1,154 million, compared with EUR 591 million in the same period in 2010. The underlying result was also
higher than in 2010, at EUR 1,186 million versus EUR 1,097 million, confirming the continued robustness of
the business model in the home markets.
During KBC Ancora’s year under review (1 July 2010 to 30 June 2011), KBC Group made major strides in the
implementation of its strategic plan, as regards both the reduction of risk-weighted assets and divestments.
in addition, the KBC group was able to strengthen its capital and reserves as planned through profit
retention.
The strategic plan, which was formulated at the end of 2009, was amended during the year under review,
partly in view of the changed regulatory environment in which KBC Group had to operate. On 27 July 2011,
approval was obtained from the European Commission to sell off the banking (Kredyt Bank) and insurance
(Warta) activities in Poland and to reduce or sell selected ABS or CDO assets. These moves came instead of
the planned stock market introductions of minority participating interests in CSOB Bank (Czech Republic)
and K&h Bank (hungary) on the one hand, and the sale and leaseback of the head office in Belgium on the
other.
On 15 July 2011, it was announced that KBC Bank had come through the EU stress test for 2011, to which 91
European banks were subjected, satisfactorily. The aim of the stress test was to assess the ability of European
banks to withstand severe shocks and to test their specific solvency in response to hypothetical adverse
events in certain restrictive circumstances. The tests were carried out by the European Banking Authority
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in collaboration with the National Bank of Belgium, the European Central Bank, the European Commission
and the European Systemic Risk Board.
Despite the difficult financial and economic context, KBC Ancora is convinced that consistent implementation
of the modified strategy will mean that the KBC group is equipped to face future challenges. KBC Ancora,
together with the other core shareholders, will give the KBC group its full and active support.
Leuven, 29 August 2011
Franky Depickere Cynthia Van Hulle luc Discrymanaging Director and Permanent representative of managing Director Permanent representative of Van hulle & Cie SCS, Almancora Société de gestion Almancora Société de gestion1 Chairman of the Board of Directors of Almancora Société de gestion
1 Almancora Société de gestion is the statutory manager of KBC Ancora (see 2.1.2 Almancora Société de gestion SA)
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D E C L A R AT i O N B y T h E R E S P O N S i B L E i N D i V i D U A L S
Declaration pursuant to the European regulations on transparency as imposed by the Belgian Royal Decree
of 14 November 2007.
“We, the members of the Board of Directors of Almancora Société de gestion2, statutory manager of KBC
Ancora SCA, hereby declare that, as far as we are aware, a) the KBC Ancora financial statements, which have
been prepared in accordance with the financial reporting standards applicable in Belgium, give a true and
fair view of the net worth, financial position and results of KBC Ancora; b) the KBC Ancora annual report
gives a true and fair view of the development and results of the business and of the position of KBC Ancora.”
D E C L A R AT i O N i N C O N N E C T i O N W i T h R i S K S
Certain risk factors can have an impact on the value of the assets held by KBC Ancora and on its ability to
distribute a dividend.
KBC Ancora’s assets consist almost entirely of a participating interest in KBC Group. A fall in the KBC Group
share price will inevitably have a negative influence on the value of KBC Ancora’s assets.
KBC Ancora’s recurrent income consists principally of the dividend it receives from its participating interest
in KBC Group. in the event that KBC Ancora does not receive a dividend from that participating interest
in any given year, KBC Ancora will itself not pay a dividend in that year. if KBC Ancora receives KBC Group
dividend again in a subsequent financial year, its result carried forward from previous years will be taken
into account when determining the profit available for distribution.
if KBC Group distributes a dividend in 2012 in respect of the financial year 2011, KBC Ancora will set off the
result available for appropriation for the financial year 2011/2012 against the loss carried forward as at the
end of the financial year 2010/2011 (EUR 29.7 million) before distributing any dividend itself. This set-off will
enable KBC Ancora to (further) reduce part of its short-term liabilities.
if KBC Group should distribute no (or a very limited) dividend in 2012 in respect of the financial year 2011,
KBC Ancora would close the financial year 2011/2012 with a loss, and would of course not distribute a
dividend itself. in that case, KBC Ancora would probably raise additional debt finance to fund its operating
costs and interest charges.
for information on the specific risks to which KBC Group is exposed, reference is made to the annual report
and press releases of KBC Group, which are available on the website www.kbc.com.
2 The individual members of the Board of Directors of Almancora Société de gestion are listed in section 2.2.2. of this Annual Report.
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15
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25
30
35
40
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5
07-2010 08-2010 09-2010 10-2010 11-2010 12-2010 01-2011 02-2011 03-2011 04-2011 05-2011 06-2011
45KBC Ancora KBC Group
1 investor information
1.1 Share price, discount and traded volumes
As at the balance sheet date, KBC Ancora had a total of 82,216,380 KBC Group shares in portfolio. Debt less
current assets amounted to EUR 597.6 million. KBC Ancora has itself issued 78,301,314 shares. The intrinsic
value3 of one KBC Ancora share as at the balance sheet date accordingly corresponded to the price of 1.05
KBC Group shares less EUR 7.63.
Chart 1 traces the performance of the KBC Ancora and KBC Group shares during the last financial year.
Chart 1: Trend in KBC Ancora and KBC Group share price during the last financial year
Chart 2 shows the trend in the discount of the KBC Ancora share relative to its intrinsic value over the year
under review, in relative terms. This fluctuated between 27.5% and 45.6%.
3 Intrinsic value: value per share calculated on the basis of the stock market price of the underlying listed share, less the liabilities.
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Chart 2: Trend in discount of the KBC Ancora share relative to its intrinsic value over the last financial year,
in relative terms4 (in %)
Chart 3 illustrates the liquidity of the KBC Ancora share.
Chart 3: Traded volumes of KBC Ancora shares on a daily basis over the past financial year
4 Intrinsic value per KBC Ancora share (IV) = (price of KBC Group share x number of KBC Group shares held by KBC Ancora + other assets – liabilities) / number of KBC Ancora shares in issue.
Discount in relative terms = (IV – KBC Ancora share price) – IV
20%
30%
40%
50%
60%
10%
0%
70%
07-2010 08-2010 09-2010 10-2010 11-2010 12-2010 01-2011 02-2011 03-2011 04-2011 05-2011 06-2011
e
u
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0
100,000
200,000
07-2010 08-2010 09-2010 10-2010 11-2010 12-2010 01-2011 02-2011 03-2011 04-2011 05-2011 06-2011
300,000
400,000
500,000
450,000
350,000
250,000
150,000
50,000
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Table 1 summarises a number of stock market figures and compares them with the performance in previous
financial years.
table 1: Summary of stock market figures in the most recent financial years
Charts 4 and 5 show the trend in KBC Ancora’s share price relative to that of the KBC Group share, the BEL20
index and the Dow Jones EURO STOXX Bank index in the year under review.
Chart 4: Trend in KBC Ancora and KBC Group share prices relative to BEL20 index in the past financial year
(1July 2010 = 100)
FY
‘10/’11
FY
‘09/’10
FY
‘08/’09
Share price High (euR) 17.15 21.74 55.4
Share price low (euR) 11.18 6.08 2.65
Average number of shares traded per day
• period 01.07-30.06 (financial year) 86,369 301,888 283,956• period 01.07-31.12 86,987 415,863 181,782• period 01.01-30.06 85,726 183,390 388,563
0
40
60
80
100
120
140
07-2010 09-2010 10-2010 11-2010 12-2010 01-2011 02-2011 03-2011 04-2011 05-2011 06-201108-2010
20
KBC Ancora KBC Group Bel20
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Chart 5: Trend in KBC Ancora and KBC Group share prices relative to Dow Jones EURO STOXX Bank index in
the past financial year (1 July 2010 = 100)
0
40
60
80
100
120
140
07-2010 09-2010 10-2010 11-2010 12-2010 01-2011 02-2011 03-2011 04-2011 05-2011 06-201108-2010
20
KBC Ancora KBC Group DJeS Bank
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1.2 Key figures as at balance sheet date
1.2.1 Balance sheet and result
Table 2 contains a number of key figures as at the balance sheet date for the most recent financial years.
table 2: Key figures as at balance sheet date
30 June 2011 30 June 2010 30 June 2009
number of shares in issue 78,301,314 78,301,314 78,301,314
number of KBC Group shares in
portfolio82,216,380 82,216,380 82,216,380
Balance sheet total in euR 2,589,828,066 2,589,834,126 2,589,844,752
Market capitalisation in euR (based on share price on balance
sheet date)
995,209,701 1,145,548,224 572,382,605
Book value of capital and reserves
in euR1,992,211,288 1,962,044,290 1,992,505,042
Market capitalisation/book value
of capital and reserves0.50 0.58 0.29
Table 3 recategorises the results recorded in previous financial years in accordance with a schedule
designed for companies whose business operations are primarily defined as ownership of equity holdings.
A distinction is made between financial and other results. The results are also broken down into recurring
and non-recurring elements.
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table 3: Results for the most recent financial years
1.2.2 Cash flow table
Table 4 shows the cash flows of KBC Ancora. it shows that the net cash flow from operating activities in the
financial year 2010/2011, which because of the outstanding loss carried forward was not eligible for distribution
as dividend (see elsewhere in this Annual Report), was used to reduce the financial debt. in the preceding
financial year 2009/2010, in which KBC Ancora realised virtually no income, the interest charges and operating
costs were principally financed through the drawdown of debt. This was also the case in the preceding financial
year 2008/2009.
table 4: Cash flow table for the most recent financial years
Cash flow table
(x euR million)
Financial year
2010/2011
Financial year
2009/2010
Financial year
2008/2009
operating activities 30.2 -30.3 -33.6
Net profit 30.2 -30.5 -1,258.7
Non-cash costs/revenues 0.0 0.0 1,228.4
movement in net working capital 0.0 0.2 -3.3
Investing activities 0.0 0.0 0.0
financial fixed assets 0.0 0.0 0.0
Financing activities -30.2 30.3 30.5
financial liabilities -30.2 30.3 30.5
Distribution of interim dividend 0.0 0.0 0.0
total cash flow 0.0 0.0 -3.1
Result of KBC Ancora
(x euR million)
Financial year
2010/2011
Financial year
2009/2010
Financial year
2008/2009
Recurring financial profit/loss 32.3 -28.2 -28.1
Other recurring profit/loss -2.1 -2.3 -2.1
Profit/loss from capital operations 0 0 -1,228.4
Extraordinary profit/loss 0 0 0
Result before taxes 30.2 -30.5 -1,258.7
Result after taxes 30.2 -30.5 -1,258.7
Result of KBC Ancora
per share (in euR)
Financial year
2010/2011
Financial year
2009/2010
Financial year
2008/2009
Recurring financial profit/loss 0.41 -0.36 -0.36
Other recurring profit/loss -0.03 -0.03 -0.03
Profit/loss from capital operations 0.00 0.00 -15.69
Extraordinary profit/loss 0.00 0.00 0.00
Result before taxes 0.39 -0.39 -16.07
Result after taxes 0.39 -0.39 -16.07
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1.2.3 Dividend
As KBC Group distributed a dividend in 2011 (in respect of the financial year 2010), KBC Ancora was able to
close the year under review with a profit. however, the positive result (EUR 30.2 million) was insufficient to
cancel out completely the outstanding loss carried forward as at the end of the previous financial year (EUR
-59.8 million). As in the two preceding financial years, therefore, KBC Ancora will not distribute a dividend in
respect of the financial year 2010/2011.
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1.3 Distribution of KBC Ancora shares
1.3.1 KBC Ancora shareholdership
There is a statutory requirement to disclose participating interests in listed companies of (multiples of ) 5%.
in addition, KBC Ancora’s Articles of Association stipulate disclosure thresholds of 1% and 3%.
On 26 August 2011 Cera reported (pursuant to Article 74 §8 of the Law of 1 April 2007 concerning public
takeover bids) that as at 30 June 2011 it (still) held more than 30% of the voting rights in KBC Ancora.
Specifically, Cera reported that it held 46,406,639 of the total of 78,301,314 KBC Ancora shares, or 59.27%.
KBC Ancora received no notifications in the year under review pursuant to the provisions of the Law of 2
may 2007 concerning the disclosure of major shareholdings.
A complete list of the participating interest disclosures received in previous financial years can be found on
the KBC Ancora website.
1.3.2 The road to the market
in accordance with the statutory rules governing cooperative societies in Belgium, Cera members are per-
mitted to withdraw voluntarily with their shares during the first half of each financial year. Cera’s financial
year coincides with the calendar year.
members who withdraw with their cooperative D-shares receive a special ‘reimbursement on withdrawal’,
consisting primarily of 4.2 KBC Ancora shares. in other words, members receive 4.2 KBC Ancora shares for
each D-share which they surrender on withdrawal from Cera. They can then choose between keeping the
KBC Ancora shares or selling them on the stock market.
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2 Declaration concerning effective corporate governance
2.1 Group structure
Chart 6 shows KBC Ancora’s group structure within the KBC group. The dotted line indicates the companies
that belong to the Cera/KBC Ancora group.
Chart 6: Group structure5
2.1.1 Almancora ASBL
The object of Almancora ASBL (‘Association sans but lucratif’) is to support the stability and continuity of
the KBC group. As controlling shareholder of Almancora Société de gestion, it plays an important part in the
appointment of the latter’s Board of Directors.
in the same capacity, Almancora ASBL has the casting vote at the General meeting of Shareholders of
Almancora Société de gestion.
Almancora ASBL’s Board of Directors comprises the representatives of Cera members and the managing
directors of Almancora Société de gestion.
5 AVAs: Other Permanent Shareholders MRBB: Maatschappij voor Roerend Bezit van de Boerenbond SCRL These parties together with Cera and KBC Ancora constitute the core shareholders of KBC Group and entered into a shareholder agreement
to this end on 23 December 2004 with a view to supporting the general policy of KBC Group (see 2.1.4 KBC Ancora SCA).
Stock Market
Almancora ASBL
AlmancoraSociété de gestion
SA
KBC Group SA
Ancora ASBL
Cera
SCRL
Based on latest public data as of 30 June 2011* approx. 5% is held by companies within the KBC group.
AVAsMRBBSCRL
StockMarket
Central & EasternEurope
BelgiumMerchant
BankingGroup Centre
KBC Ancora
SCA
approx. 7%
approx. 60%
p.m. p.m.
approx. 23%
approx. 11%
approx. 100%
approx. 13%
approx. 40%
approx. 41%*
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2.1.2 Almancora Société de gestion SA
KBC Ancora does not have a Board of Directors of its own, but is administered by a statutory manager –
Almancora Société de gestion SA – the duties of which include setting out the policy to be pursued by KBC
Ancora.
Almancora Société de gestion’s Board of Directors (see section 2.2.2 Board of Directors of Almancora Société
de gestion SA) is made up of at least four representatives of Cera members, at least two managing directors
and at least three independent directors.
2.1.3 Ancora ASBL
KBC Ancora’s Articles of Association include rules for dealing with conflicts of interest. it was in this context
that Ancora ASBL was founded.
Ancora ASBL acts as ad hoc representative in the event that Almancora Société de gestion has a conflict of
interest with regard to a decision it has to take as manager of KBC Ancora, if Almancora Société de gestion
is prevented from fulfilling its duties or if the statutory manager’s mandate expires before KBC Ancora’s
General meeting of Shareholders is able to appoint a new statutory manager. in such an event, Ancora ASBL
will temporarily assume the management role of Almancora Société de gestion.
The Board of Directors of Ancora ASBL consists of Almancora Société de gestion SA’s independent directors.
2.1.4 KBC Ancora SCA
KBC Ancora’s principal activity is the maintenance and management of its shareholding in KBC Group with a
view to ensuring, in collaboration with Cera, mRBB and the Other Permanent Shareholders, the shareholder
stability and continuity of KBC Group. To this end, KBC Ancora signed a shareholder agreement with these
parties on 23 December 2004, covering 108.8 million KBC Group shares, or 30.40% of the total number
of KBC Group shares in issue. Cera and KBC Ancora are viewed as a single party for the purposes of the
agreement. Together, they have committed 42.7 million KBC Group shares, or 11.93% of the total number of
KBC Group shares, with KBC Ancora committing 32.6 million KBC Group shares, or 9.12% of the total number
of KBC Group shares, and Cera the rest.
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2.2 Effective corporate governance
KBC Ancora attaches great importance to corporate governance.
KBC Ancora applies the Belgian Corporate Governance Code 2009 as a reference code. it is committed to
implementing the 2009 Code as fully as possible.6
KBC Ancora’s Corporate Governance Charter explains the principal aspects of the company’s policy in
relation to corporate governance. it is available on the website www.kbcancora.be.
As KBC Ancora is managed by a statutory manager, the provisions of the Belgian Corporate Governance
Code are applied at the level of the Board of Directors of Almancora Société de gestion SA.
The Board of Directors of Almancora Société de gestion applies the Principles of the Corporate Governance
Code in full. it deviates from the Provisions of the Code where the specific characteristics of KBC Ancora or
its statutory manager or specific circumstances make this necessary. in such cases the deviation is explained
in accordance with the ‘comply or explain’ principle.
KBC Ancora’s Corporate Governance Charter deviates from only two Provisions of the Code.
Contrary to Provisions 5.1. and 5.3./4. of the Corporate Governance Code, the Appointments Committee
of Almancora Société de gestion may submit proposals directly (i.e. without the intervention of the Board
of Directors) to the General meeting of Shareholders of Almancora Société de gestion as regards the
appointment of A, B and C directors. This offers the best guarantee of an independent nominations policy,
in which the focus is exclusively on KBC Ancora’s interests.
in addition, contrary to Provision 7.11 of the Corporate Governance Code, the members of the Day-to-Day
management Committee receive no variable remuneration for their actual and fixed functions within KBC
Ancora, for the reasons explained in section 2.4.
2.2.1 management structure
The statutory manager bears unlimited liability vis-à-vis KBC Ancora’s creditors. KBC Ancora’s other
shareholders are only liable to the extent of their contribution.
Pursuant to the Belgian Companies’ Code (Code des sociétés), the statutory manager’s endorsement
must be obtained before any decision of the General meeting of Shareholders affecting third parties (e.g.
payment of a dividend) or any amendment to the Articles of Association can be ratified or enacted.
The manager was appointed in the Articles of Association for an indefinite period. its mandate may only be
terminated under exceptional circumstances. The manager may, however, choose to resign without having
to seek the consent of the General meeting of Shareholders.
Almancora Société de gestion is authorised as manager to do all that is necessary for or conducive to the
achievement of the company’s object, with the exception of powers that are reserved by law for the General
meeting of Shareholders.
Almancora Société de gestion receives no remuneration for exercising its managerial mandate, but costs
incurred during the exercise of that mandate are reimbursed.
6 The Code may be consulted at www.corporategovernancecommittee.be.
| 2 1 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
2.2.2 Board of Directors of Almancora Société de gestion SA
The following changes took place in the composition of the Board of Directors in the year under review:
At the Extraordinary General meeting of Almancora Société de gestion held on 29 October 2010,
Katelijn Callewaert was appointed as a C director with effect from 29 October 2010 until the General
meeting in 2014.
Katelijn Callewaert (b. 1958) obtained a degree in Law (Licentiaat in de Rechten) at Ghent University, and
also obtained a diploma in fiscal studies at the Fiscale Hogeschool in Brussels.
She has worked at PricewaterhouseCoopers Tax Consultants sccrl-bcvba since 1981, since 1991 as a
director, and currently holds the position of Tax Director Global Compliance Services. She is also a member
of the TLS (Tax and Legal Services) HR Board of PricewaterhouseCoopers Tax Consultants.
She is a member of the Belgian Institute of Accountants and Tax Consultants (IAB-IEC), sits on numerous
committees of the IAB-IEC and is a member of the International Fiscal Association (IFA) and the Association
for Fiscal and Accountancy Professions for the province of Brabant (BAB Brabant). She has also worked as a
lecturer and is a member of the examinations board at the Fiscale Hogeschool in Brussels.
Katelijn Callewaert has been a member of the Board of Directors of Almancora Société de gestion since 29
October 2010.
The directorship mandate of Servus SCRL, with ivo Verhaeghe as its permanent representative, ended
on 26 November 2010 as the permanent representative had reached the age limit stipulated in the
Articles of Association. At the Extraordinary General meeting of Shareholders held on 29 October
2010, herman Vandaele was appointed as a C director with effect from 26 November 2010 until the
General meeting in 2014.
Herman Vandaele (b. 1950) obtained a degree in Applied Economics (Licentiaat in de Toegepaste
Economische Wetenschappen) at the University of Antwerp (UFSIA) and the degree of Master in Treasury
& Banking and Tax Management at IPO Antwerpen (now Antwerp Management School). He also followed
an Executive Management Programme at CEDEP/INSEAD in Fontainebleau and a Leadership Program at
the University of Colorado Denver.
Until the end of December 2010 he was General Manager Corporate Projects at Bekaert SA, and has held
various positions within the Bekaert group since 1975, both in Belgium and abroad. He has many years
of experience in corporate and headquarter responsibilities. His expertise extends among other things to
plant control, corporate finance, audit, personnel management, IT, corporate treasury and banking, M&A,
shared services, investor relations and general management.
In the period 1985-2000 he worked as a lecturer at Ehsal and Vlekho higher education colleges (now
Hogeschool-Universiteit Brussel - HUB) and at IPO Antwerpen (now Antwerp Management School).
Herman Vandaele has been a member of the Board of Directors of Almancora Société de gestion since 26
November 2010.
-
-
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 2 2 |
herman Vandaele resigned as a C director of Almancora Société de gestion on 28 January 2011.
At the Extraordinary General meeting of Almancora Société de gestion held on 28 January 2011, the
private company with limited liability Vandaele herman SCRL, with herman Vandaele as permanent
representative, was appointed as a new C director with effect from 28 January 2011 and for the
completion of the directorship of herman Vandaele.
Table 5 sets out the composition of the Board of Directors of Almancora Société de gestion and
the committees set up under the Board’s aegis. The number of meetings attended by the relevant
Board member are reported for the Board of Directors and its committees. The Board met 11 times
in the financial year 2010/2011; the Audit Committee met four times, the Appointments Committee
four times and the Remuneration Committee twice.
-
| 2 3 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
table 5: Composition of the Board of Directors of Almancora Société de gestion SA and overview of
individual attendancesn
ame
end
of c
urre
nt te
rm
A d
irec
tors
B di
rect
ors
C di
rect
ors
Day
-to-
Day
Man
agem
ent
Com
mit
tee
Aud
it C
omm
itte
e
App
oint
men
ts C
omm
itte
e
Rem
uner
atio
n Co
mm
itte
e
Franky Depickere1 2014 11 11 4
luc Discry(from 13 Aug. 2010)
2014 11 11
Germain Vantieghem(until 13 Aug. 2010)
2010
Jean-François Dister2 2014 9
Johan Massy 2013 11 4
peter Müller 2012 10 2
Jos plessers 2011 9 4
Ghislaine Van Kerckhove 2013 10
léopold Bragard 2012 10 4 2
Katelijn Callewaert3 (since 29 Oct. 2010)
2014 8 2 2
Herman Vandaele4 (from 26 Nov. 2010 to 28 Jan. 2011)
2011 1 1 0
Vandaele Herman SCRl4 (permanent representative: herman Vandaele) (since 28 Jan. 2011)
2014 6 1 1 1
Servus SCRl(permanent representative: ivo Verhaeghe) (until 26 Jan. 2010)
2010 4 2 3 1
Van Hulle & Cie SCS(permanent representative: Cynthia Van hulle) Chairman
2013 11 4 2
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 2 4 |
1 At the General Meeting of Almancora Société de gestion held on 26 November 2010, Franky Depickere was reappointed as an
A director of Almancora Société de gestion for a new term of four years.
2 On 30 August 2010, Jean-François Dister resigned as a B director of Almancora Société de gestion. He was reappointed as a
B director with effect from 29 October 2010 at the Extraordinary General Meeting of Almancora Société de gestion held on that
date.
3 Katelijn Callewaert has been a member of the Board of Directors, the Audit Committee and the Appointments Committee
since 29 October 2010. Since taking up her mandate she has attended all meetings of the Board of Management, the Audit
Committee and the Appointments Committee.
4 Herman Vandaele has been a member of the Board of Management and the Audit Committee, the Appointments Committee
and the Remuneration Committee since 26 November 2010. Since 28 January 2011 he has performed these functions as the
permanent representative of the private company with limited liability Vandaele Herman SCRL. Since taking up his mandate he
has attended all meetings of the Board of Management and all meetings of the Audit Committee, the Appointments Committee
and the Remuneration Committee.
2.2.2.1 Composition of the Board of Directors
The mandate of the statutory manager, Almancora Société de gestion, may only be terminated with its
agreement or by judicial ruling, if there are legal grounds for this. for that reason, a great deal of attention
has been paid to the way in which the Board of Directors of Almancora Société de gestion itself is consti-
tuted. Account was taken when drafting the Articles of Association of KBC Ancora’s anchoring objective,
the principles of effective corporate governance – more specifically recommendations from the competent
authorities – and the legal rules regarding conflicts of interest in listed companies.
The Board of Directors of Almancora Société de gestion consists of three types of directors, each with its
own specific conditions for appointment:
• A directors are those whose directorship forms part of their everyday professional activity.
The individuals in question are managing directors of Almancora Société de gestion, with individual
powers of representation. The two current A directors are also managing directors of Cera Société de
gestion, Cera’s statutory manager. This creates a personal link between KBC Ancora and Cera.
• B directors are non-executive directors who are members of the consultative bodies that operate
within Cera Ancora, as long as the latter does not oppose their candidacy. These directors personify the
institutional link between KBC Ancora and Cera, as also enshrined in the description of KBC Ancora’s
object as set out in its Articles of Association.
• C directors are independent directors. They are appointed because of their independence vis-à-vis the
management of KBC Ancora, Cera and the KBC group.
Directors are appointed for a maximum term of four years.
| 2 5 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
Directorships may be renewed. if a directorship is renewed within the same category, the director concerned
may be reappointed one or more times on expiry of each term of office, though only for immediately
following terms. A directorship may not last for more than a total of 12 years 7.
B and C directorships terminate by law following the Annual General meeting held in the twelfth year of the
directorship. A directorship also ends by law in any event following the General meeting of Shareholders
held in the year following the year in which the director in question has reached the age of 70 years.
A directorships are renewable without limit and end by law in any event at the moment that the director
concerned reaches the age of 65 years.
in the event that there are one or more unfilled directorships, the remaining directors of the same category
are authorised to fill the vacancy or vacancies on a temporary basis from candidates proposed by the
Appointments Committee until the next General meeting of Shareholders.
The Board elects a Chairman from its B and C members.
The A and C directors together constitute the majority on the Board of Directors; there must be a minimum
of three C directors. Persons may only be appointed as A, B or C directors by the General meeting of
Shareholders at the nomination of the Appointments Committee of Almancora Société de gestion.
The C directors constitute the majority of the members of this Appointments Committee.
The company applies strict independence criteria. These independence criteria are set out in Article 9 of the
Articles of Association of Almancora Société de gestion. All C directors also comply with the new statutory
independence criteria as defined in Section 526ter of the Belgian Companies’ Code (Code des sociétés).
2.2.2.2 Powers of the Board of Directors
The Board of Directors of Almancora Société de gestion is authorised to perform all acts which are necessary
for or conducive to the achievement of its object and, in the context of its managership of KBC Ancora, for
the achievement of the object of KBC Ancora.
in exercising its directorship mandate within KBC Ancora, Almancora Société de gestion must pay particular
attention to the object of KBC Ancora; that object is aimed at the maintenance and management of a
participating interest in KBC Group, or of every company and/or group of companies which is a continuation
thereof in order, together with Cera, to achieve and maintain the anchoring of KBC Group as described in
the KBC Ancora Articles of Association.
The Board of Directors carries out all tasks which are assigned to it by law and/or the Articles of Association.
Decisions on the strategy of the company, its values and the focus of its policy take account of the
consultations between KBC Ancora and Cera.
7 The following transitional rules apply in relation to the length of directorships and their possible extension for directors who were incumbent as at 24 October 2003: directorships which were current on 24 October 2003 could be continued until the end of the period for which they (the directors) were appointed. After the ending of these directorships, the terms of office of the directors concerned may be extended by periods of up to six years, until they have reached the age limit of seventy years or have completed three terms of six years. Pursuant to the Law of 17 December 2008 concerning the ‘creation of an Audit Committee in listed companies and financial enterprises’, these transitional rules will not be applied to the independent directors (the C directors) to the extent that the statutory criteria as set out in the new Section 526 of the Belgian Companies’ Code (Code des sociétés) (no more than three consecutive terms of office, with a maximum of 12 years) would be exceeded.
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 2 6 |
The Board of Directors exercises these powers with regard both to the management of Almancora Société de
gestion itself and in relation to the management of KBC Ancora, given the capacity of Almancora Société de
gestion as statutory manager of KBC Ancora, all in accordance with the respective provisions of the Articles
of Association. Where relevant, the Board of Directors also takes account of the cost-sharing association
between Cera and KBC Ancora (see section 3.2.2.1 Costs within the cost-sharing association with Cera).
The Board of Directors is also authorised, in view of the capacity of Almancora Société de gestion as statutory
manager of KBC Ancora, to consult and collaborate with Cera in the light of their parallel anchoring objective.
Almancora Société de gestion is bound to implement its mandate as statutory manager personally.
however, as permitted by the KBC Ancora Articles of Association, the Board of Directors of Almancora
Société de gestion has delegated the day-to-day management of KBC Ancora and of Almancora Société de
gestion, as well as the implementation of the decisions taken by the statutory manager, to two A directors
who together constitute the Day-to-Day management Committee.
2.2.2.3 Functioning of the Board of Directors
The functioning of the Board of Directors is governed by the Articles of Association, supplemented by the
relevant provisions of the Belgian Companies’ Code (Code des sociétés). further details are contained in the
‘Guidelines for Directors of Almancora Société de gestion for the exercise of their directorship’, which form
part of the internal Addendum to the KBC Ancora Corporate Governance Charter.
The Board of Directors met 11 times in the year under review. Each of these meetings was attended by
virtually all members. in addition to its traditional duties (adopting the annual and interim results, proposal
for result appropriation, monitoring the activities of the Audit Committee, Appointments Committee and
Remuneration Committee, approving the budgets, etc.), the Board of Directors also dealt with the following
topics among others in the financial year 2010/2011:
• monitoring the strategy and results of the KBC group
• Risk management within the Cera/KBC Ancora group
• Legal proceedings in relation to the purchase of KBC Group shares by KBC Ancora in 2007
• monitoring mandates (resignation and appointment of a B director, appointment of two new
C directors, reappointment of an A director and appointment of members of the Committees)
• Passing on of the actual costs of the statutory manager under application of Section 523 of the
Belgian Companies’ Code (Code des sociétés)
• Charging on the fees of A directors in connection with the cost-sharing association between Cera
and KBC Ancora
• Amendment of the Corporate Governance Charter
| 2 7 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
2.2.3 Committees appointed within the Board of Directors
2.2.3.1 Day-to-Day Management Committee
• Composition:
The Day-to-Day management Committee is a collegial body that comprises the two A directors.
The mandate of the members of the Day-to-Day management Committee ends on expiry of their term of
office as A directors on the Board of Directors.
• powers:
The Day-to-Day management Committee prepares the meetings of the Board of Directors and forwards
proposals for decisions to the Board.
The Committee exercises its powers autonomously, but always within the framework of the general
strategy as adopted by the Board of Directors.
The Day-to-Day management Committee is authorised to conduct the day-to-day management of both
Almancora Société de gestion and KBC Ancora.
• Function:
The Day-to-Day management Committee has been charged by the Board of Directors with the day-to-
day management of the company. in principle, the Day-to-Day management Committee meets once
a month. The Committee met 11 times in the year under review. in addition, there were of course the
ongoing informal contacts between the managing Directors.
2.2.3.2 Audit Committee
• Composition:
The Audit Committee comprises a minimum of three directors, other than A directors. more than half the
members of the Audit Committee must be C directors.
The Audit Committee elects a chairman from among its members, who may not also be the Chairman of
the Board of Directors, and appoints a secretary.
The Audit Committee has sufficient relevant expertise in the fields of accounting and audit. Léopold
Bragard, Katelijn Callewaert and herman Vandaele (as permanent representative of Vandaele herman
SCRL) were designated as the Audit Committee members with specific experience in relation to
accounting and audit.
Léopold Bragard obtained a doctorate in mathematics from the University of Liège (1973) and a ‘Certificat
d’études statistiques et opérationelles’ (1972) from the Institut de Statistique de Paris. From 1980 to 1997
he was a professor at the Faculties of Law, Economics and Social Sciences and later at the Faculties of
Economics, Business Administration and Social Sciences at the University of Liège. He was Dean of the
latter Faculty from 1990 to 1997, General Administrator of the University of Liège from 1997 to 2005,
and in September 2005 was appointed Honorary Administrator of this university in September 2005.
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 2 8 |
Katelijn Callewaert obtained a degree in Law (Licentiaat in de Rechten) at Ghent University in Belgium,
and also obtained a diploma in fiscal studies at the Fiscale Hogeschool in Brussels. She has worked
at PricewaterhouseCoopers Tax Consultants sccrl-bcvba since 1981, since 1991 as a director, and
currently holds the position of Tax Director Global Compliance Services. She is also a member of the
TLS (Tax and Legal Services) HR Board of PricewaterhouseCoopers Tax Consultants. She is a member
of the Belgian Institute of Accountants and Tax Consultants (IAB-IEC), sits on numerous committees
of the IAB-IEC and is a member of the International Fiscal Association (IFA) and the Association for
Fiscal and Accountancy Professions for the province of Brabant (BAB Brabant). She has also worked
as a lecturer and is a member of the examinations board at the Fiscale Hogeschool in Brussels.
Herman Vandaele obtained a degree in Applied Economics (Licentiaat in de Toegepaste Economische
Wetenschappen) at the University of Antwerp (UFSIA) and the degree of Master in Treasury & Banking
and Tax Management at IPO Antwerpen (now Antwerp Management School). He also followed an
Executive Management Programme at CEDEP/INSEAD in Fontainebleau and a Leadership Program at
the University of Colorado Denver. Until the end of December 2010 he was General Manager Corporate
Projects at Bekaert SA, and has held various positions within the Bekaert group since 1975, both in
Belgium and abroad. He possesses years of experience in corporate and headquarter responsibilities. His
expertise extends among other things to plant control, corporate finance, audit, personnel management,
IT, corporate treasury and banking, M&A, shared services, investor relations and general management.
In the period 1985-2000 he worked as a lecturer at Ehsal and Vlekho higher education colleges (now
Hogeschool-Universiteit Brussel - HUB) and at IPO Antwerpen (now Antwerp Management School).
• powers:
The Audit Committee supports the Board of Directors in the performance of its supervisory tasks in res-
pect of audit in the widest sense.
The Audit Committee’s tasks relate in particular to:
• Financialreportingandcommunication
• Internalcontrolandriskmanagement
• Overseeingtheeffectivefunctioningofthecompany’sinternalcontrolsystem
• Theexternalauditfunctionperformedbytheauditor
• Additionalauditduties
• Function:
The Audit Committee meets as often as necessary for its proper functioning, and at least four times a year.
The Audit Committee’s activities are governed by the internal Rules of the Audit Committee, which are
incorporated in the Corporate Governance Charter.
The managing directors are not members of the Audit Committee, but are invited to attend its meetings.
This arrangement guarantees the necessary dialogue between the Board of Directors and the executive
management.
The Audit Committee met four times during the year under review. Among the topics discussed at these
meetings were the following:
| 2 9 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
• DraftfinancialstatementsanddraftannualreportofKBCAncoraforthefinancialyear2009/2010
• Budgetsforthecost-sharingassociationbetweenCeraandKBCAncora
• Auditplanningbytheauditor
• InterimfiguresofKBCAncora
• AppointmentofanewchairmanoftheAuditCommittee
• Statusofevaluationandfurtherdevelopmentofinternalcontrolandriskmanagementsystems
• CompositionoftheAuditCommittee/designationofmemberswithspecificexpertiseinrelationto
accounting and audit
• EvaluationoftheeffectivenessoftheAuditCommitteeandtheadequacyofitsInternalRules
• Budgetsforthenextfinancialyear
2.2.3.3 Appointments Committee
• Composition:
The Appointments Committee comprises a minimum of three directors. The C directors together consti-
tute the majority of the Appointments Committee.
The Appointments Committee is chaired by the Chairman of the Board of Directors of Almancora Société
de gestion, except where the choice of his or her successor is being discussed.
• powers:
The Appointments Committee submits proposals directly (i.e. without the intervention of the Board
of Directors) to the General meeting of Shareholders of Almancora Société de gestion as regards the
appointment of A, B and C directors. The Appointments Committee nominates at least two candidates
for each vacancy.
As the majority of the Appointments Committee consists of independent, non-executive directors
(C directors), the direct nomination of candidate directors offers the best guarantee of an independent
nominations policy, in which the focus is exclusively on KBC Ancora’s interests.
No directors may be appointed who have not been nominated by the Appointments Committee.
• Function:
The Appointments Committee meets as often as necessary for its proper functioning, and at least twice
a year.
The Appointments Committee’s activities are governed by the internal Rules of the Appointments
Committee, which are incorporated in the Corporate Governance Charter.
The Appointments Committee met four times during the year under review. Among the matters discussed
at these meetings were the following:
• ResignationandappointmentofaBdirector
• AppointmentoftwonewCdirectors
• ReappointmentofanAdirector
• AppointmentofmembersoftheCommittees
• EvaluationofthecompositionandsizeoftheCommittees.
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 3 0 |
Whenever necessary or appropriate, joint meetings were organised between the Appointments
Committee of Almancora Société de gestion and the Appointments Committee of Cera Société de
gestion.
2.2.3.4 Remuneration Committee
• Composition:
The Remuneration Committee comprises at least three directors, other than A directors, of whom the
majority are independent directors.
The Remuneration Committee is chaired by the Chairman of the Board of Directors of Almancora Société
de gestion.
• powers:
The Remuneration Committee:
• makes proposals regarding the remuneration policy for B and C directors
• makes proposals regarding the remuneration policy for members of the Day-to-Day management
Committee (A directors)
• makes recommendations concerning the individual remuneration of B and C directors and members
of the Day-to-Day management Committee
• makes proposals regarding the remuneration policy for management members other than the
members of the Day-to-Day management Committee of Almancora Société de gestion
Where relevant, this is discussed with the Remuneration Committee of Cera Société de gestion
• Function:
The Remuneration Committee meets as often as necessary for its proper functioning, and at least twice a
year. The Remuneration Committee met twice in the year under review.
The Remuneration Committee’s activities are governed by the internal Rules of the Remuneration
Committee, which are incorporated in the KBC Ancora Corporate Governance Charter.
The activities of the Remuneration Committee in the year under review are discussed in the Remuneration
report (see section 2.4 of this Annual Report).
2.2.4 Auditor
The General meeting of Shareholders of 31 October 2008 appointed KPmG Réviseurs d’entreprises, repre-
sented by Erik Clinck, as auditor for a period of three financial years.
KPmG Réviseurs d’entreprises received an annual fee of EUR 16,303 (including VAT) in the financial year
2010/2011 for the performance of its normal auditing duties.
| 3 1 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
2.3 main features of the evaluation process for the Board of Directors, its committees and its individual members
The Board of Directors discusses and evaluates its size, composition and activities on a regular basis, and at
least once every three years, as well as the functioning of the Board and its committees and the interaction
between the Board of Directors and the Day-to-Day management Committee. This evaluation is performed
by the Board of Directors on the initiative of the chairman and assisted by the Appointments Committee. in
addition, each committee tests and assesses its effectiveness each year and submits a report on this to the
Board of Directors. Where necessary, the committee in question proposes changes to the Board of Directors.
The contribution of each member of the Board of Directors is periodically evaluated in order to be able to
adapt the composition of the Board of Directors to take account of changing circumstances. The evaluation
takes into account their general role as directors as well as their specific roles as chairman or member/
chairman of a committee, respectively. in the event of a reappointment, the commitment and effectiveness
of the director concerned are assessed in accordance with a predetermined and transparent procedure.
The Board of Directors acts on the basis of the results of the evaluation by identifying its strengths and ad-
dressing its weaknesses. Where appropriate this means that new members are proposed for appointment,
that it is proposed that existing members should not be reappointed or that measures are taken that are
deemed conducive to the effective functioning of the Board of Directors.
B and C directors meet at least once a year in the absence of the A directors in order to evaluate their inter-
action with the Day-to-Day management Committee.
2.4 Remuneration report for the financial year 2010/2011
Description of the procedures for the development of the remuneration policy of individual directors
and members of the Day-to-Day Management Committee
As KBC Ancora is managed by a statutory manager, the corporate governance provisions of the Belgian
Corporate Governance Code are applied at the level of the Board of Directors of Almancora Société de
gestion SA. The same applies for KBC Ancora’s remuneration policy. Almancora Société de gestion receives
no separate remuneration for performing its mandate as a statutory manager. it does receive payment for
the costs it incurs in respect of the actual remuneration of the directors (fixed and variable) and for the
reimbursement of expenses for B and C directors.
The Board of Directors of Almancora Société de gestion has appointed a Remuneration Committee which
advises the Board of Directors on the remuneration policy and individual remuneration of B and C directors
and of members of the Day-to-Day management Committee (A directors) and makes proposals for the
remuneration policy for the other Board members.
The Remuneration Committee monitors trends in legislation, the Corporate Governance Code and market
practices, paying particular attention to developments in the remuneration policy at KBC Group SA.
The Board of Directors may also instruct the Remuneration Committee on its own initiative or at the proposal
of the Day-to-Day management Committee to investigate possible changes to the remuneration policy and
to advise the Board of Directors accordingly.
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 3 2 |
The Remuneration Committee met twice in the year under review. Among the matters discussed at these
meetings were the evaluation of the functioning of the Remuneration Committee, the remuneration
package for the new A director and the variable remuneration of the Chairman of the Day-to-Day
management Committee in the context of the cost-sharing association between Cera and KBC Ancora.
Whenever necessary or appropriate, joint meetings were organised between the Remuneration Committee
of Almancora Société de gestion and the Remuneration Committee of Cera Société de gestion.
Declaration concerning the remuneration policy pursued during the year under review with respect
to the members of the Day-to-Day Management Committee
The Remuneration Committee hereby declares the following:
Principles of the remuneration policy with due observance of the relationship between remuneration and
performance
The Day-to-Day management Committee is a collegial body comprising two managing directors (the A
directors) and is charged with the day-to-day management of both Almancora Société de gestion and KBC
Ancora.
The A directors of Almancora Société de gestion are currently also the A directors of Cera Société de gestion,
statutory manager of Cera.
As members of the Day-to-Day management Committees, A directors are charged among other things
with the day-to-day management of Cera and KBC Ancora, respectively. Their remuneration package is
fixed contractually. With the exception of the variable remuneration of the chairman of the Day-to-Day
management Committee (which is paid in full by Cera), 20% of their remuneration is charged on to KBC
Ancora in the context of the cost-sharing association between Cera and KBC Ancora (see section 3.2.2.1
Costs within the cost-sharing association with Cera).
The remuneration of the members of the Day-to-Day management Committee, 20% of which is paid by KBC
Ancora, consists of a fixed remuneration, the use of a company car or travel allowance and a competitive
insurance package, which among other things includes a supplementary retirement or survivor’s pension,
hospitalisation insurance and emergency assistance insurance.
The amount of the fixed remuneration is determined on the basis of the individual responsibilities and
powers of the A directors, taking into account the remuneration paid for comparable functions in the
marketplace.
During the year under review, Cera opted to bring the variable remuneration of franky Depickere more
into line with the objectives of Cera and to decouple that portion of the variable remuneration which is
assessed on the basis of criteria specific to Cera from the results of the KBC group. The statutory manager of
KBC Ancora – at the proposal of the Remuneration Committee and after following the applicable procedure
in relation to conflicts of interest as set out in the KBC Ancora Corporate Governance Charter - decided on
the one hand that it was no longer appropriate in the circumstances to continue passing on part of the
variable remuneration via the cost-sharing association with Cera, and on the other hand that it would not
be desirable to allocate a variable remuneration of its own.
| 3 3 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
The ultimate objective of KBC Ancora, namely the anchoring of KBC Group, is predicated on a very long-term
vision. in the light of this, it is not entirely appropriate to formulate performance criteria, the assessment of
which will inevitably be based on a relatively short-term perspective. moreover, variable remuneration which
is based solely on individual performance criteria pertaining to the A director concerned within KBC Ancora
will inevitably be limited in scope compared with the fixed remuneration. Bearing in mind the modest share
taken by KBC Ancora in the fixed remuneration (20%), the benefits of this limited variable remuneration
are not sufficient to justify the administrative complexity it involves, because it would bring the personal
financial interests of the A directors and the interests of KBC Ancora into line to only a limited extent. for
this reason, KBC Ancora decided to deviate from Provision 7.11 of the Corporate Governance Code, which
recommends that an appropriate portion of the remuneration package of the executive management be
linked to the performance of the company and to the performance of the individuals concerned.
for these reasons, the statutory manager - again at the proposal of the Remuneration Committee and after
following the applicable procedure in respect of conflicts of interest as set out in the KBC Ancora Corporate
Governance Charter - decided that no variable remuneration would be allocated to the members of the
Day-to-Day management Committee. for the sake of completeness, it should be stressed that the decision
no longer to provide variable remuneration is not offset by any increase in the other remuneration elements.
Relative weight of the different remuneration components
During the year under review, the fixed portion of the remuneration and the pension contributions were
the most important components.
features of the performance bonuses in the form of shares, options or other rights to acquire shares
Not applicable.
Remuneration of individual non-executive directors of Almancora Société de gestion SA
As a basic principle, non-executive directors (B and C directors) of Almancora Société de gestion receive
a fair level of remuneration which is proportionate to their contribution to the policy of KBC Ancora, as
follows:
• TheremunerationofBandCdirectorstakesintoaccounttheirresponsibilitiesandtimeinvestment.
• BandCdirectorsreceiveafixedannualremunerationplusanattendancefeeforeachmeetingofthe
Board of Directors attended. The remuneration of B directors also takes into account the remuneration
they receive for their membership of the Board of Directors of Cera Société de gestion.
• Giventhelargeamountoftimehe/sheinvestsinKBCAncora,theChairmanoftheBoardofDirectors
enjoys a deviating remuneration regime. he or she receives a higher fixed remuneration, but no
attendance fees.
• BorCdirectorswhoaremembersoftheAuditCommitteealsoreceiveanattendancefeeforeach
meeting of the Committee they attend. The chairman of the Audit Committee receives a fixed
remuneration.
• ThemembersoftheAppointmentsCommitteeandtheRemunerationCommitteedonotreceive
attendance fees, but merely a mileage allowance.
• Finally,BandCdirectorsareentitledtoreimbursementofexpensesincurredinexercisingtheir
function as directors.
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 3 4 |
table 6: Remuneration of non-executive directors of Almancora Société de gestion
Information on the remuneration that members of the Day-to-Day Management Committee who are
also members of the Board of Directors would have received in that capacity
Neither fixed remuneration nor attendance fees were paid to the two members of the Day-to-Day manage-
ment Committee for the performance of their mandate as directors.
evaluation criteria based on the performance of the company
Not applicable in view of the non-payment of variable remuneration.
Remuneration of the members of the Day-to-Day Management Committee
The Day-to-Day management Committee is a collegial body that comprises two managing directors acting
jointly. The company is therefore not led by a CEO in the sense of a sole operational and responsible repre-
sentative of the enterprise. Nonetheless, in implementation of the provisions of the Corporate Governance
Code and the Law on reinforcing corporate governance in listed companies, the individual remuneration of
the Chairman of the Day-to-Day management Committee (franky Depickere) is disclosed.
Board of
Directors
(fixed)
Board of
Directors
(attendance fee)
Audit Committee
(fixed)
Audit
Committee
(attendance fee)
total
léopold Bragard 4,000 6,000 - 2,400 12,400
Katelijn Callewaert 2,667 4,800 - 1,200 8,667
Jean-François Dister 2,400 2,700 - - 5,100
Johan Massy 3,200 3,600 - 2,400 9,200
peter Müller 3,200 3,300 - - 6,500
Jos plessers 4,800 3,000 - - 7,800
Servus SCRl 2,017 2,904 - 1,452 6,373
Vandaele Herman 333 600 - - 933
Vandaele Herman SCRl 2,000 3,600 3,200 - 8,800
Van Hulle & Cie SCS 27,000 - - - 27,000
Ghislaine Van Kerckhove 3,200 3,300 - - 6,500
totAl 54,817 33,804 3,200 7,452 99,273
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table 7: Remuneration of Day-to-Day management Committee of KBC Ancora
* The pension contributions take the form of fixed contributions to fund a supplementary retirement or
survivor’s pension.
** Other remuneration comprises the use of a company car and a disability insurance, hospital insurance and
emergency assistance insurance package.
Shares, share options and other rights to acquire KBC Ancora shares granted, exercised or lapsed
during the year under review, on an individual basis
No shares, share options or other rights to acquire KBC Ancora shares were granted or exercised during or
before the year under review.
provisions on severance packages for the members of the Day-to-Day Management Committee
The terms and conditions governing the employment of members of the Day-to-Day management
Committee are set out in individual employment contracts agreed between Cera and the parties concerned.
20% of the cost price of these contracts (with the exception of the variable remuneration – see above) is
passed on to KBC Ancora in the context of the cost-sharing association between Cera and KBC Ancora (see
section 3.2.2.1 Costs within the cost-sharing association with Cera). The employment contract agreed with
franky Depickere took effect on 1 September 2006, well before the new Corporate Governance Code and
the Law on reinforcing corporate governance in listed companies came into force. it provides for a severance
package equivalent to 24 months’ fixed remuneration, and the company is bound to meet this contractual
obligation should the situation arise. The employment contract agreed with Luc Discry took effect on
13 August 2010 and provides for a severance package equivalent to 12 months’ fixed remuneration.
fixed pension* other**
Day-to-Day Management Committee 132,742 17,911 2,447
of which the Chairman 114,750 15,067 1,582
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 3 6 |
2.5 internal control and risk management
Since KBC Ancora is a single-asset holding company whose sole asset is a substantial participating interest
in KBC Group, the operational activities of KBC Ancora are fairly limited. KBC Ancora employs no staff.
The operational activities are in the hands of joint staff of Cera and KBC Ancora (with costs being charged
by Cera to KBC Ancora via the cost-sharing association; see section 3.2.2.1 Costs within the cost-sharing
association with Cera).
The budgets are prepared by the Day-to-Day management Committee and are explained and discussed
in the Audit Committee before being submitted for approval to the Board of Directors. The Day-to-Day
management Committee periodically monitors the budgets and submits a detailed report on them to the
Audit Committee and the Board of Directors.
The system of internal control and risk management is characterised by the following elements:
• sufficient information is made available to the Audit Committee to enable the costs of debt as well as
the direct operating costs of KBC Ancora to be discussed and monitored in depth
• the other operating costs are shared costs of KBC Ancora and Cera, which are borne by Cera and
which to the extent that they relate to KBC Ancora are subsequently charged on to KBC Ancora.
The Audit Committee of Almancora Société de gestion is closely involved in the following aspects of
the discussion and monitoring of the budgets relating to the shared costs:
- organisation of an annual joint meeting of the Audit Committees of Cera Société de
gestion and Almancora Société de gestion to discuss the budgets and cost-
sharing association between Cera and KBC Ancora
- discussion of the audit cycle during this joint annual meeting
• the provision of transparent and regular information to the Audit Committee of Almancora Société de
gestion concerning the operational activities and controls in place at Cera, in so far as these are relevant
for the cost-sharing association between Cera and KBC Ancora
• taking cognisance and discussion of the annual audit report by the auditor and of the specific activities
of the auditor.
During the year under review, the Audit Committee of Almancora Société de gestion evaluated the
adequacy of the present system of internal control and risk management. Based on this evaluation, the Audit
Committee judged that there is currently no need to install additional control measures or to initiate an
internal audit function.
2.6 Rotation system
Directors were appointed for a maximum six-year term on the foundation of Almancora Société de gestion in
2001. To ensure the necessary continuity of management, the Articles of Association provided for a rotation
system under the terms of which a number of directorships lapse every two years. The rotation system is an
optional system, which Almancora Société de gestion applies whenever it deems this necessary to ensure
the continuity and proper functioning of the Board of Directors. The rotation system was applied for the first
time in 2003.
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Since a natural spread in the expiry dates of the directorships arose in 2009, the rotation system was not
applied in the financial year 2010/2011.
2.7 Code of conduct in respect of conflicts of interest
The statutory provisions concerning potential conflicts of interest with a director or with a major shareholder
(Sections 523 and 524 of the Belgian Companies’ Code (Code des sociétés)) are incorporated and elaborated
in Articles 20 and 21 of the Articles of Association. in addition, the Board of Directors of Almancora Société
de gestion has formulated rules for dealing with potential conflicts of interest between directors/members
of the Day-to-Day management Committee of Almancora Société de gestion and of KBC Ancora. These rules
are incorporated in the KBC Ancora Corporate Governance Charter.
No incidents occurred in the year under review which warranted application of the rules in respect of
conflicts of interest with a major shareholder.
The procedure in relation to a potential conflict of interest with the statutory manager did need to be
applied on one occasion in the year under review.
2.7.1 Potential conflict of interest with the statutory manager
Almancora Société de gestion acts as the statutory manager of KBC Ancora. Pursuant to Article 19 of the
Articles of Association, Almancora Société de gestion is not remunerated for exercising this management
activity. The normal costs incurred in exercising this mandate are however reimbursed. These costs consist
primarily in the remuneration of the members of its Board of Directors. The charging on of these costs falls
within the scope of the rules in respect of conflicts of interest.
2.7.1.1 Establishment of conflict of interest by Board of Directors of Almancora Société de gestion SA
On 17 December 2010, the Board of Directors of Almancora Société de gestion established that there would
be a potential conflict of interest within the meaning of Section 523 of the Belgian Companies’ Code (Code
des sociétés)8 if Almancora Société de gestion were to charge on the actual costs incurred in the current
financial year (2010/2011) (including the costs incurred in relation to the selection of two new C directors)
to KBC Ancora SCA, because those costs would exceed the maximum amount approved in 2008.
The Board of Directors decided to apply the procedure as set out in Article 20 of the Articles of Association
of KBC Ancora SCA. Specifically, this means that both the ad hoc representative Ancora ASBL and the auditor
had to be informed of the conflict of interest.
2.7.1.2 Decision of ad hoc representative: Board of Directors of Ancora ASBL
On 17 December 2010 the Board of Directors of Ancora ASBL, ad hoc representative, reached the following
decision:
8 The procedures described in this Section were written for public companies limited by shares. Since KBC Ancora is a partnership limited by shares (Société en commandité par actions), a modified procedure is incorporated in Article 20 of KBC Ancora’s Articles of Association.
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 3 8 |
“Application of Article 20 of the Association of KBC Ancora SCA
On 17 December 2010 the Board of Directors of Almancora Société de gestion established that the decision which
it was required to make in the context of the passing on of the costs of its management of KBC Ancora gave rise to
a conflict of interest as referred to in Article 20 of the Articles of Association of KBC Ancora SCA.
Pursuant to the aforementioned Article 20, the existence of this conflict of interest was reported to the ad hoc
representative and to the auditor.
As ad hoc representative, the Board of Directors of Ancora ASBL is required to record the following in the minutes
of the meeting at which its decision was taken: the nature of the decision or act with which it was charged; the
proprietary consequences of the decision for the company; and the substantiation of the decision taken.
1. Nature of the decision
The charging on of costs to KBC Ancora SCA by Almancora Société de gestion gives rise to a conflict of interest
within the meaning of Article 20 of the Articles of Association of KBC Ancora SCA.
This procedure was last applied in 2008 in relation to the charging on to KBC Ancora SCA by Almancora Société de
gestion of the costs associated with its management activities. The Board of Directors of the ad hoc representative
decided at that time to establish the maximum amount of the costs to be so charged on at EUR 160,000 (to be
adjusted annually on the basis of the consumer prices index as this applied in Belgium on 1 July 2008).
During the current financial year (2010/2011), two new C directors were appointed to the Board of Directors
of Almancora Société de gestion. A vacancy for a C director will also arise in each of the next two financial
years (2011/2012 and 2012/2013). Given the decision to use the services of an Executive Search agency for the
nomination of new candidate C directors, the costs associated with the management activities of Almancora
Société de gestion will increase from the current financial year.
If all costs associated with the management activities for the current financial year (2010/2011) were to be
charged on, this would cause the approved maximum amount to be exceeded. The Board of Directors of the ad
hoc representative is therefore required to take a decision in relation to the charging on of the costs associated
with the management activities.
2. Proprietary consequences of the decision
Based on the detailed summary of the actual and substantiated costs as supplied by the Board of Directors of
Société de gestion, the costs to be charged on in respect of the management activities of Almancora Société de
gestion for the financial year 2010/2011 can be estimated at a maximum of EUR 200,000.
Since this is merely an estimate, it is advisable to build in a margin. Moreover, in order to avoid the procedure as
set out in Article 20 having to be applied frequently, scope has been created for adjustment of the amount on the
basis of the consumer prices index.
3. Verantwoording van het genomen besluit
The Board of Directors of Ancora ASBL, ad hoc representative, has established that the costs associated with
the services of an Executive Search agency brought in during the selection process of candidate C directors
are justifiable costs which are incurred by Almancora Société de gestion pursuant to its mandate as statutory
manager of KBC Ancora SCA, and are therefore eligible for reimbursement pursuant to Article 19 of the Articles
of Association of KBC Ancora SCA. The maximum amount should therefore be increased to take account of these
| 3 9 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
costs. In order to avoid the need for frequent application of the procedure set out in Article 20 and at the same
time to make allowance for the market conformity of the costs incurred by Almancora Société de gestion, the
Board of Directors has accordingly decided to approve the charging of the actual costs, up to a maximum of EUR
200,000, to be adjusted annually on the basis of the consumer prices index as this applies on 1 July 2011 (start of
new financial year).”
2.7.1.3 Cognisance of the decision of the ad hoc representative of the Board of Directors of Almancora Société de gestion SA
On 17 December 2010, the Board of Directors of Almancora Société de gestion took cognisance of the fact
that Ancora ASBL had decided to approve the charging on of the actual costs, up to a maximum of EUR
200,000, to be adjusted annually on the basis of the consumer prices index as this applied on 1 July 2011.
2.7.2 Potential conflict of interest between directors/members of the Day-to-Day management Committee of Almancora Société de gestion and KBC Ancora
The procedure for dealing with potential conflicts of interest between directors/members of the Day-to-Day
management Committee of Almancora Société de gestion and KBC Ancora as set out in the KBC Ancora
Corporate Governance Charter was applied on one occasion, following the decision concerning the passing
on (via the cost-sharing association) and separate allocation of variable remuneration to the members of
the Day-to-Day management Committee (see above).
2.8 Code of conduct to prevent market abuse
The Board of Directors of Almancora Société de gestion has drawn up a code of conduct intended to prevent
market abuse. The principles of the code of conduct have been incorporated in the KBC Ancora Corporate
Governance Charter.
The code of conduct to prevent market abuse provides among other things for the drawing up of a list
of insiders, the setting of annual prohibited periods, the reporting of trades by directors and employees
involved to the compliance officer, the reporting of trades by management to the Belgian financial Services
and markets Authority (fSmA).
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 4 0 |
2.9 Notification in implementation of Article 34 of the Royal Decree of 14 November 2007 concerning the obligations of issuers of financial instruments that are admitted to trading on a regulated market
On 30 June 2011 the capital of KBC Ancora was represented by 78,301,314 shares without nominal value,
each representing an equal portion of the capital.
There are no restrictions imposed by law or by the Articles of Association to the transfer of securities, nor to
the exercising of the voting right.
The majority of the shares are held by Cera SCRL. On 30 June 2011 Cera held 46,406,639 KBC Ancora shares
(59.27% of the total number of shares).
KBC Ancora is managed by a statutory manager appointed pursuant to the Articles of Association. At the
Extraordinary General meeting of Shareholders held on 12 January 2001, Almancora Société de gestion
was appointed as statutory manager for the duration of the company. The management mandate of the
statutory manager may only be terminated with its agreement or by the courts if there are lawful reasons
for doing so. Decisions of the General meeting which concern the interests of KBC Ancora vis-à-vis third
parties, and decisions to amend the Articles of Association9, take effect only when and on the condition
that the statutory manager gives its consent thereto.
2.10 Annual notification pursuant to Article 74, §8 of the law of 1 April 2007 on public takeover bids
On 26 August 2011 Cera reported (pursuant to Article 74 §8 of the law of 1 April 2007 on public takeover
bids) that as at 30 June 2011 it still held more than 30% of the voting rights in KBC Ancora, specifically
holding 46,406,639 of the total of 78,301,314 KBC Ancora shares, equivalent to 59.27%.
This notification was made with a view to retaining the exemption from the obligation to issue a bid for the
entire body of securities with voting rights of KBC Ancora SCA.
2.11 Guidelines for the exercise of directorships
The ‘Guidelines for directors of Almancora Société de gestion for the exercise of their directorship mandates’
form part of the ‘internal Addendum to the KBC Ancora Corporate Governance Charter’. They were most
recently updated on 21 December 2007.
The Audit Committee oversees compliance with the ‘Guidelines for directors of Almancora Société de
gestion for the exercise of their directorship mandates’.
9 To which the statutory attendance and majority requirements as set out in Section 558 ff. of the Belgian Companies’ Code (Code des socié-tés) also apply..
| 4 1 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
2.12 Openness in investor communication
in fulfilling its duty to inform, KBC Ancora focuses on natural communication opportunities at which it not
only provides accurate information but also strives to convey that information in a comprehensible manner.
for that reason, KBC Ancora communicates about its operations in several ways, including:
• Providing access to its Articles of Association and prospectus
• Publishing interim statements
• Publishing an interim financial report
• Publishing an annual press release
• Publishing the annual report
• its website www.kbcancora.be
These communications are disseminated using the usual European media and the KBC Ancora website.
in addition, every interested party has the opportunity to subscribe to the electronic mailing list of KBC
Ancora free of charge via the website.
Since KBC Ancora’s principal asset is a major participating interest in KBC Group, specific information –
which frequently relates to the underlying group results – can also be found in the KBC Group annual report
and website and those of its subsidiaries.
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 4 2 |
3 Statutory manager’s report
3.1 Balance sheet as at 30 June 2011
KBC Ancora’s balance sheet total stood at EUR 2,589.8 million on 30 June 2011, virtually unchanged from
the previous financial year.
3.1.1 Assets
The assets consist almost entirely of a participating interest in KBC Group.
The number of KBC Group shares held by KBC Ancora remained unchanged in the year under review. As at
the balance sheet date, KBC Ancora had 82,216,380 KBC Group shares in portfolio, with a book value of EUR
31.5 per share.
The Board of Directors decided to maintain the value of these shares as at 30 June 2011, in view of:
• the long-term nature of KBC Ancora’s participating interest in KBC Group, given its key role in the
shareholder stability of the KBC group
• the fact that the underlying results of the KBC group remain satisfactory despite the difficult market
conditions
3.1.2 Liabilities
Capital and reserves amounted to EUR 1,992.2 million, an increase of EUR 30.2 million, or 1.5%, compared
with the previous financial year.
The profit for the year under review (EUR 30.2 million) has been added to the profit/loss to be carried
forward, with the result that KBC Ancora closed the year under review with capital and reserves consisting
of capital totalling EUR 2,021.9 million and a carry-forward loss of EUR 29.7 million.
Amounts owed to credit institutions reduced by EUR 30.2 million to EUR 593.5 million. Of this total, EUR 550
million related to long-term loans carrying fixed rates of interest, with repayment dates in 2017 (EUR 175
million), 2022 (EUR 100 million) and 2027 (EUR 275 million). The remainder (EUR 43.5 million) consisted of
short-term drawdowns.
Other amounts falling due within one year amounted to EUR 0.2 million.
Accruals and deferrals on the liabilities side of the balance sheet (EUR 3.9 million) relate to interest charges
recognised on a pro rata basis.
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3.2 Profit and loss account for the financial year 2010/2011
Given the nature of KBC Ancora’s operations, the same profit and loss account scheme has been used as was
customary for portfolio companies10.
KBC Ancora recorded a profit for the financial year 2010/2011 of EUR 30.2 million, equivalent to EUR 0.39
per share.
3.2.1 income
KBC Ancora realised income of EUR 61.7 million, or EUR 0.79 per share, in the year under review.
Table 8 summarises the movements in the various income categories within KBC Ancora in recent financial
years.
table 8: Trend in KBC Ancora income
3.2.1.1 Income from financial fixed assets
On 6 may 2011, KBC Group distributed a dividend of EUR 0.75 per share in respect of the financial year
2010. KBC Ancora accordingly received a total of EUR 61.7 million in respect of its participating interest of
82,216,380 KBC Group shares.
3.2.1.2 Other income
There was virtually no other income in the year under review.
3.2.2 Expenses
KBC Ancora’s total costs amounted to EUR 31.5 million, or EUR 0.40 per share, an increase of EUR 1.1 million
compared with the previous financial year.
Table 9 summarises the movements in the various cost categories in recent financial years.
10 On 29 October 2004 KBC Ancora obtained the permission of the competent minister to continue using the non-consolidated financial statements model as formerly included as an annex to the Royal Decree of 1 September 1986 concerning portfolio companies.
(x euR million)Financial year
2010/2011
Financial year
2009/2010
Financial year
2008/2009
Income from financial fixed assets 61.7 0.0 0.0
other income 0.0 0.0 0.1
totAl 61.7 0.0 0.1
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 4 4 |
table 9: Trend in KBC Ancora costs
3.2.2.1 Costs within the cost-sharing association with Cera
KBC Ancora set up a cost-sharing association with Cera in 2001 in order to enhance the cost-efficiency of
both parties’ operations. A budget is drawn up annually, setting out the different costs within the cost-
sharing association. KBC Ancora reimburses Cera for part of these budgeted costs every six months on a pro
rata basis. Settlement then occurs at the end of each calendar year based on the actual costs.
The costs in connection with the cost-sharing association amounted to EUR 1.61 million in the year under
review, EUR 0.09 million less than in the previous financial year.
Table 10 summarises the various cost categories within the cost-sharing association with Cera and the cost
allocation percentage as this has been applied since 1 January 2006.
table 10: Costs within the cost-sharing association with Cera
(x euR million)Financial year
2010/2011
Financial year
2009/2010
Financial year
2008/2009
Cost-sharing association 1.6 1.7 1.75
Costs of debt 29.4 28.2 28.2
other operating costs 0.5 0.55 0.4
taxes 0.0 0.0 0.0
Write-down in value of financial fixed assets
0.0 0.0 1,228.4
totAl 31.5 30.5 1,258.8
Cost-sharing associationCost allocation
percentage
Amount
(x euR million)
Administration/management/advice 20% 0.43
Support 20% 0.50
Financial unit 50% 0.31
Membership and capital administration 10% 0.20
Communications 20% 0.18
totAl 1.61
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3.2.2.2 Costs of debt
The costs of debt amounted to EUR 29.4 million in the year under review, EUR 1.2 million more than in the
previous financial year.
3.2.2.3 Other operating costs
Other operating costs amounted to EUR 0.5 million, EUR 0.05 million less than in the previous financial year.
The principal operating costs incurred related to:
• stock exchange listing: EUR 0.19 million
• management activities: EUR 0.17 million
3.2.2.4 Taxes
KBC Ancora has no corporation tax liability in respect of the year under review.
3.3 Result and proposed appropriation of the result
The loss to be appropriated amounted to EUR 29.7 million as at the end of the year under review. This
figure is the product of the profit recorded in the year under review of EUR 30.2 million and the loss carried
forward from the previous financial year amounting to EUR 59.8 million.
As stated earlier, KBC Ancora will not distribute a dividend in respect of the year under review. The General
meeting of Shareholders of KBC Ancora is invited to carry forward the remaining loss to be appropriated
(EUR 29.7 million) to the next financial year.
3.4 Legal proceedingsfour KBC Ancora shareholders filed a minority claim in December 2008 against Almancora Société de
gestion and its permanent representative. The proceedings, in which KBC Ancora was also involved, were
also filed against Cera.
The plaintiffs are contesting the purchase of 2.3 million KBC Group shares by KBC Ancora in march 2007,
which was effected in the context of the splitting of the KBC Ancora share. The plaintiffs are also contesting
the purchase of 3.9 million KBC Group shares by KBC Ancora which was effected in mid-2007 in order to
ensure that, together with Cera, its shareholding in KBC Group would exceed the 30% threshold as set
out in the Law of 1 April 2007 on public takeover bids, which came into force in Belgium on 1 September
2007. The main objective of their claim is that the defendants should acquire the purchased shares at the
acquisition price.
The statutory manager is convinced that the transactions in question were decided upon and executed
correctly, and accordingly looks forward to the outcome of the proceedings with every confidence.
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 4 6 |
3.5 Additional information No significant events need to be reported which took place after the balance sheet date.
No activities were carried out in the area of research and development.
The company has no branch offices.
KBC Ancora’s principal asset is a participating interest in KBC Group. The value of KBC Ancora’s assets, as well
as its results, are therefore largely influenced by developments relating to the KBC group.
Pursuant to Section 96, §1, 6° of the Belgian Companies’ Code (Code des sociétés), a company whose
balance sheet reveals a carried-forward loss or whose profit and loss account shows a loss for the year
during two consecutive financial years is required to justify the application of the valuation principles on
the presumption of continuity. KBC Ancora closed the financial year 2010/2011 with a carried-forward
accounting loss.
The Board of Directors believes that application of the valuation principles on continuity of the activities is
justified. Particular reference is made in this context to a) the fact that the KBC group continued to achieve
reasonable underlying results even during the financial crisis, indicating that its business model in the
home markets is robust; b) the recovery plan approved by the EU, which is intended to lead to a substantial
lowering of the risk profile of the KBC group and repayment of the government within a reasonable period;
and c) the fact that KBC Group once again distributed a dividend in 2011 (in respect of the financial year
2010).
3.6 No consolidated financial statements for KBC Ancora
KBC Ancora has only one equity holding in another company, namely its participating interest in KBC Group.
KBC Ancora has no control over that company, either legally or in practice. Consequently, KBC Ancora is not
obliged to produce consolidated financial statements.
KBC Ancora shareholders who are interested can however find additional useful information in KBC Group’s
consolidated annual report, which can be consulted on the KBC Group website (www.kbc.com). The annual
report may also be requested from: KBC Group SA, investor Relations, havenlaan 2 SEE, 1080 Brussels or by
e-mail from [email protected].
3.7 most recent financial year and available information for 2011 on KBC Group
3.7.1 Past financial year of KBC Group
KBC Group’s most recent financial year (2010) was discussed in the financial press release on the financial
year 2010 and in its last annual report. The main company developments and financial highlights are set
out below.
| 4 7 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
KBC Group closed the financial year 2010 with a profit of EUR 1.86 billion. The underlying profit amounted
to EUR 1.71 billion.
The financial highlights of KBC Group in the financial year 2010 can be summarised as follows:
The net result for 2010 amounted to a positive EUR 1,860 million, as opposed to a net loss of EUR 2,466
million in 2009, which was heavily impacted by losses related to CDOs and shares, among other things.
Excluding exceptional items, the underlying net result for 2010 totalled EUR 1,710 million, almost equal to
the figure for 2009.
Net interest income amounted to EUR 6,245 million, up 7% year-on-year. On a comparable basis, credit
volumes contracted, in line with the intention to scale down the international loan book. The loan book in
Belgium grew by 5%, reflecting the gradual economic recovery. Customer deposits were up by 6%, with
Belgium posting 8% growth and CEE 3%. The net interest margin increased from 1.84% in 2009 to 1.92% in
2010.
Earned insurance premiums, before reinsurance, stood at EUR 4,616 million, 5% lower than in 2009. Net of
technical charges and the ceded reinsurance result, technical insurance income came to EUR 347 million.
2010 was characterised by a relatively high level of claims, due to factors such as flooding in Central and
Eastern Europe and adverse weather conditions in Belgium. The combined ratio for the group’s insurance
companies came to 100.3% for the year, compared to 100.1% for 2009. There was a vast improvement in the
after-tax result for the insurance business, turning a loss of EUR 140 million in 2009 to a profit of EUR 675
million for 2010, primarily because of good financial results.
Net fee and commission income amounted to EUR 1,224 million, up 8% year-on-year. in 2010, sales of
commission-based products were higher than in 2009, which was still very much impacted by the adverse
effects of the financial crisis. Assets under management grew from EUR 205 billion to EUR 209 billion over
the year on account of positive net entry effects.
The net result from financial instruments at fair value (trading and fair value income) came to EUR -77
million, compared to EUR -3,485 million a year earlier. On an underlying basis (i.e. excluding exceptional
items such as value adjustments on structured credits, losses related to activities of KBC financial Products
that are being wound down, and after shifting all trading-related income items to this income statement
line), trading and fair value income amounted to EUR 855 million, down 9% year-on-year.
The remaining income components were as follows: dividend income from equity investments amounted
to EUR 97 million (compared to EUR 139 million in 2009), the net realised result from available-for-sale
assets (bonds and shares) stood at EUR 90 million (EUR 224 million a year earlier) and other net income
totalled EUR 452 million (EUR 427 million a year earlier).
Operating expenses amounted to EUR -4,436 million in 2010, 7% lower than in 2009. The cost decrease
is clearly related to the strategic refocus programme where non-core activities are being wound down,
as well as to the continued effects of rigorous cost control measures throughout the group. The 2010
figure included negative items such as the hungarian bank tax and Belgian deposit guarantee scheme.
The underlying cost/income ratio for banking – a measure of cost efficiency – stood at 56%, in line with last
year’s number.
impairment charges stood at EUR -1,656 million, down a substantial 39% year-on-year. This decrease was
most pronounced in relation to loans and receivables, which came in at EUR -1,483 million, compared to
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 4 8 |
EUR -1,901 million in 2009. As a result, the annualised credit cost ratio for 2010 amounted to 0.91%, down on
the figure of 1.11% for 2009. Other impairment charges totalled EUR -173 million in 2010 and related mainly
to available-for-sale assets (shares and bonds) and goodwill on subsidiaries and associated companies.
income tax amounted to EUR 82 million, payable in the year under review. This figure includes a positive
deferred tax asset of EUR 0.4 billion booked in the second quarter of the year.
The net post-tax result from discontinued operations amounted to EUR 254 million negative. This comprises
the results and impairment related to the sale agreement for KBL EPB, which are regrouped in this single line
under ifRS accounting rules (reference figures were adjusted accordingly).
At year-end 2010, total equity came to EUR 18.7 billion, an increase of EUR 1.5 billion compared to the
start of the year, due predominantly to the inclusion of the positive result for 2010 and to a decrease in
the revaluation reserve for available-for-sale assets. The group’s tier-1 capital ratio – a measure of financial
strength – stood at a sound 12.6%.
The profit figures and key ratios in table 11 give an impression of the result of KBC Group in the financial year
2010 and a comparison with the financial years 2009 and 2008.
| 4 9 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
table 11: Profit figures and key ratios of KBC Group for the financial years 2010, 2009 and 2008
* Underlying group profit means the net profit excluding exceptional items falling outside the normal business operations. The coupon payable on the core capital securities issued to the Belgian and flemish governments is deducted on a pro rata basis from the earnings in the ‘earnings per share’ calculation.
(x euR million) 2010 2009 2008
net group profit 1,860 -2,466 -2,484
underlying group profit* 1,710 1,724 2,270
Belgium Business Unit 1,051 1,150 1,080
Central and Eastern Europe Business Unit 406 161 469
merchant Banking Business Unit 133 300 461
Group Services and Operations 120 213 258
net earnings per share (in euR) 3.72 -7.26 -7.31
Dividend per share (in euR) 0.75 0.00 0.00
Shareholders’ equity per share (in euR) 32.8 28.4 31.5
Costs/income ratio, banking activities 56% 104% 104%
Credit cost ratio, banking activities 0.91% 1.11% 0.70%
Combined ratio, non-life insurance 100% 101% 95%
Solvency (tier 1) of KBC Bank and KBl epB (Basel II) 12.6% 10.8% 8.9%
Return on equity 12% -23% -18%
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 5 0 |
Chart 7 shows the trend in the (underlying) profit of KBC Group over the last five financial years.
Chart 7: Trend in (underlying) KBC Group profit (x EUR million)
3.7.2 first half of KBC Group financial year 2011
KBC Group published its results for the first half of 2011 on 31 August 2011. KBC Group closed the first half of
the financial year 2011 with a profit of EUR 1.15 billion, a substantial improvement over the EUR 591 million
recorded in the same period in 2010. The underlying profit amounted to EUR 1.19 billion.
The financial highlights can be summarised as follows.
Net interest income amounted to EUR 2,801 million in 1h2011, down 9% on its 1h2010 level. On a
comparable basis, credit volumes contracted by 8% year-on-year in merchant Banking and by 11% in the
Group Centre, in line with the intention to scale down the international loan book. On the other hand,
the loan book in Belgium grew by 4% year-on-year, with mortgage loans up by as much as 7%, while loan
volumes in CEE were up by 1% (sizeable increases in the Czech Republic and Slovakia), with mortgage loans
going up by 4%. year-on-year, customer deposits rose by 6% in Belgium, remained flat in CEE and decreased
significantly in merchant Banking and the Group Centre. The net interest margin widened from 1.84% in
1h2010 to 1.95% in 1h2011.
Earned insurance premiums, before reinsurance, stood at EUR 2,115 million in 1h2011, 12% down on the
figure for 1h2010, due to life insurance. Net of technical charges and the ceded reinsurance result, technical
insurance income came to EUR 238 million, up 62% on the year-earlier figure. The first half of 2011 was
characterised by a relatively low level of claims. The combined ratio for the group’s insurance companies
came to an excellent 87% for 1h2011, compared to 100% for fy2010.
2,500
3,000
3,500
2,000
1,500
1,000
500
0
2006 2007 2008
3,430 3,281
-500
-1,000
-1,500
-2,000
-2,500
-2,484
2,548 3,143 2,270
2009-2,466
1,724
4,000
-3,00020101,860
1,710
profit
underlying profit
| 5 1 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
Net fee and commission income amounted to EUR 597 million in 1h2011, down 9% on its 1h2010 level.
Sales of commission-based products were subdued in the first half of 2011. Assets under management
stood at EUR 203 billion at the end of June 2011, 3% down on their year-earlier level on account of negative
net entry effects, though partly mitigated by a positive investment performance.
The net result from financial instruments at fair value (trading and fair value income) came to EUR 279 million
in 1h2011, compared to EUR -733 million in 1h2010. On an underlying basis (i.e. excluding exceptional items
such as value adjustments to structured credit, results related to the activities of KBC financial Products that
are being wound down, and after shifting all trading-related income items to this income statement line),
trading and fair value income amounted to EUR 361 million in 1h2011.
The remaining income components were as follows: dividend income from equity investments amounted
to EUR 53 million, the net realised result from available-for-sale assets (bonds and shares) stood at EUR 76
million and other net income totalled EUR 202 million. When aggregated, this figure was 14% lower year-
on-year.
Operating expenses amounted to EUR 2,224 million in 1h2011, 5% higher than in 1h2010. The cost
comparison is distorted by the booking (in 1Q2011) of the hungarian bank tax for fy2011 (EUR 62 million).
Excluding this item, costs increased by a mere 2% year-on-year. The underlying cost/income ratio for
banking – a measure of cost efficiency – stood at 56% in 1h2011, in line with the figure recorded for fy2010.
impairment stood at EUR 437 million in 1h2011. impairments on loans and receivables amounted to EUR
260 million, significantly less than the EUR 633 million recorded in 1h2010. As a result, the annualised
credit cost ratio for 1h2011 came to a favourable 0.32%, down on the figure of 0.91% for fy2010. Other
impairment charges totalled EUR 176 million in 1h2011 and relate mainly to Greek government bonds (EUR
139 million, pre-tax).
income tax amounted to EUR 411 million for 1h2011.
At the end of the first half of 2011, total equity came to EUR 19.0 billion, a EUR 0.3-billion increase compared
to the start of the year, due mainly to the inclusion of the positive result for the period under review (EUR
1.2 billion) and partly offset by the dividend and state coupon paid (EUR -0.9 billion, combined). The group’s
tier-1 capital ratio – a measure of financial strength – stood at a sound 13.9% at end-June 2011. including the
effect of sale agreements announced to date (Centea), the pro forma tier-1 ratio amounts to approximately
14.3%.
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 5 2 |
Table 12 compares the profit trend in the various KBC Group Business Units in the first half of 2011 with the
first half of 2010.
table 12: Profit figures of KBC Group for the first half of the financial years 2011 and 2010.
* Underlying group profit means the net profit excluding exceptional items falling outside the normal business operations. All planned divestments of group companies are included under Group Services and Operations, and all reference figures have been adjusted retrospectively. The changes to the strategic plan announced in mid-2011 have not yet been incorporated in the distribution across the business units.
3.8 Outlook for the financial year 2011/2012
Income
KBC Ancora’s principal source of income is the dividend it receives from its participating interest in KBC
Group. forecasts of KBC Group’s future dividend rely heavily on factors such as the projection of KBC Group’s
future earnings.
On 9 August 2011, KBC Group announced an interim result of EUR 1.15 billion for the first half of 2011.
The underlying profit in the first half of 2011 amounted to EUR 1.19 billion.
Costs
Costs within the cost-sharing association with Cera are expected to be approximately EUR 1.8 million.
Total interest charges for the financial year 2011/2012 are estimated at approximately EUR 30 million.
Other operating costs are likely to be around EUR 0.5 million.
it is likely that that KBC Ancora will have no corporation tax liability in the financial year 2011/2012.
(x euR million) 1H2011 1H2010
net group profit 1,154 591
underlying group profit* 1,186 1,097
Belgium 518 577
Central and Eastern Europe 239 222
merchant Banking 240 206
Group Services and Operations 189 93
net earnings per share (in euR) 2.52 0.86
Shareholders’ equity per share (in euR) 33.8 30.2
| 5 3 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
f i N A N C i A L R E P O R T
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 5 4 |
(in euR) note 30 June 2011 30 June 2010
ASSetS 2,589,828,066 2,589,834,126
Fixed assets 2,589,815,970 2,589,815,970
financial fixed assets 5.4/ 5.5.1 2,589,815,970 2,589,815,970
Companies with which there is a
participatory relationship5.14 2,589,815,970 2,589,815,970
Participating interests 2,589,815,970 2,589,815,970
Current assets 12,096 18,156
Cash at bank and in hand 8,104 14,826
Accruals and deferrals 5.6 3,993 3,331
4 financial report
4.1 Balance sheet
Balance sheet after profit appropriation
| 5 5 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
(in euR) note 30 June 2011 30 June 2010
lIABIlItIeS 2,589,828,066 2,589,834,126
Capital and reserves 1,992,211,288 1,962,044,290
Capital 5.7 2,021,871,293 2,021,871,293
issued capital 2,021,871,293 2,021,871,293
Reserves 0 0
Statutory reserves 0 0
Result carried forward -29,660,005 -59,827,003
Creditors 597,616,779 627,789,837
Amounts falling due after more than one year 5.9 550,000,000 550,000,000
financial creditors 550,000,000 550,000,000
Credit institutions 550,000,000 550,000,000
Amounts falling due within one year 43,694,381 73,863,732
financial liabilities 43,451,958 73,639,983
Credit institutions 43,451,958 73,639,983
Trade creditors 174,559 143,637
Suppliers 174,559 143,637
Other creditors 67,864 80,112
Accruals and deferred income 5.9 3,922,398 3,926,105
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 5 6 |
(in euR) 30 June 2011 30 June 2010
ReSultS 30,166,998 -30,460,752
expenses 31,525,430 30,461,781
A. Cost of debt 29,410,767 28,203,261
B. Other financial expenses 106 106
C. Services and sundry goods 2,113,330 2,257,183
E. Sundry current costs 1,227 1,231
Income 61,692,428 1,028
A. income from financial fixed assets 61,662,285 0
1. Dividend 61,662,285 0
B. income from current assets 25 24
E. Other current income 30,118 1,004
treatment of results
Profit (loss) balance to be appropriated -29,660,006 -1,288,264,965
Profit (loss) to be appropriated for the year 30,166,998 -30,460,752
Result brought forward from previous financial year -59,827,003 -1,257,804,213
Withdrawal from capital and reserves 0 1,228,437,962
from capital 0 1,167,982,710
from the reserves 0 60,455,252
Addition to capital and reserves 0 0
Addition to statutory reserve 0 0
Result to be carried forward -29,660,006 -59,827,003
Profit to be distributed 0 0
Capital remuneration 0 0
4.2 Profit and loss account
| 5 7 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
4.3 NotesCoMpAnIeS WItH WHICH tHeRe IS A pARtICIpAtoRY RelAtIonSHIp – pARtICIpAtInG InteReStS
AnD SHAReS (5.4.2)
Financial year previous
financial year
Acquisition value at end of year 3,818,253,932
Movements during the year
Acquisitions 0
Transfers and decommissioning 0
Acquisition value at end of year 3,818,253,932
Value write-downs as at end of financial year 1,228,437,962
Movements during the year
Recorded 0
Value write-downs as at end of financial year 1,228,437,962
net BooK VAlue At enD oF YeAR 2,589,815,970
noteS on tHe pARtICIpAtInG InteReStS (5.5.1)
pARtICIpAtInG InteReStS AnD oWneRSHIp RIGHtS In otHeR CoMpAnIeS
The table below sets out the businesses in which the company has a shareholding (included in items 280
and 282, Assets) and the other businesses in which the company holds ownership rights (included in items
284 and 51/53, Assets) amounting to at least 10% of the issued capital.
Name, full address of the
registered office and, in
the case of companies
under Belgian law, the
Company Number
Ownership rights held byData drawn from most recently available
financial statements
DirectlySubsid-
iaries
fina
ncia
l
stat
emen
ts a
s at
Curr
ency
cod
e Capital and
reserves
Net
result
Number % %(+) of (-)
(in currency units)
KBC Group SA
consolidated
havenlaan 2
1080 Brussels 8, Belgium
BE 0403.227.515
31.1
2.20
10
EUR
11,1
47,2
13,3
31
1,88
8,23
9,31
9
including treasury shares
Excluding treasury shares
82,216,380
82,216,380
22.97
24.20
0.00
0.00
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 5 8 |
StAteMent oF CApItAl AnD SHAReHolDeR StRuCtuRe (5.7)
Financial year previous financial year
StAteMent oF CApItAl
Authorised capital
Issued capital
- at end of previous financial year 2,021,871,293
- at end of financial year 2,021,871,293
Amount number of shares
Capital composition
Types of shares
Ordinary shares 2,021,871,293 78,301,314
Registered 39,803,524
Bearer and/or dematerialised shares 38,497,790
SHAReHolDeR StRuCtuRe oF tHe CoMpAnY At YeAR-enD ACCoRDInG to notIFICAtIonS
ReCeIVeD BY tHe CoMpAnY
Cera SCRl 59.27%
Notification pursuant to the Law on public takeover bids dated 26 August 2011 – shareholdership as at
30 June 2011
Gino Coorevits/portus SA 1.49%
Transparency report dated 9 December 2009 – shareholdership as at 30 October 2009
StAteMent oF lIABIlItIeS, ACCRuAlS AnD DeFeRReD InCoMe (lIABIlItIeS) (5.9)
SpeCIFICAtIon oF lIABIlItIeS WItH An oRIGInAl teRM oF MoRe tHAn one YeAR,
BY ReMAInInG teRM
Financial year
liabilities with a remaining term of more than five years
financial liabilities 550,000,000
Credit institutions 550,000,000
total liabilities with a remaining term of more than five years 550,000,000
ACCRuAlS AnD DeFeRReD InCoMe
Specification of item 492/3 of the liabilities, if a substantial amount falls into that category
Attributable interest 3,922,398
| 5 9 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
opeRAtInG ReSultS (5.10)
opeRAtInG CoStS
other operating costs Financial year previous financial
year
Other 1,227 1,231
tAXeS (5.12)
tAX on tHe ReSult
Main reasons for the differences between the profit before tax as per the financial statements
and the estimated taxable profit
Definitive taxed income and dividend received 58,579,171
VAlue ADDeD tAX AnD tAXeS In ReSpeCt oF tHIRD pARtIeS
Financial year previous financial
year
Value added tax charged
By the company 771 2,022
RelAtIonSHIpS WItH ASSoCIAteD CoMpAnIeS AnD CoMpAnIeS WItH WHICH tHeRe IS A
pARtICIpAtoRY RelAtIonSHIp (5.14)
CoMpAnIeS WItH WHICH tHeRe IS A pARtICIpAtoRY RelAtIonSHIp
Financial year previous financial
year
Financial fixed assets 2,589,815,970 2,589,815,970
Participating interests 2,589,815,970 2,589,815,970
FInAnCIAl RelAtIonSHIpS WItH (5.15)
tHe AuDItoR(S) AnD tHe peRSonS WItH WHoM He/tHeY IS/ARe ASSoCIAteD
Financial year
Remuneration of the auditor(s) 13,474
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 6 0 |
4.4 Valuation principles
The financial year runs from 1 July to 30 June inclusive.
Formation expenses
formation expenses are stated at acquisition value and are amortised on a straight-line basis at a rate of
20% per year.
Intangible fixed assets
intangible fixed assets are stated at acquisition value and are amortised on a straight-line basis at a rate of
20% per year.
tangible fixed assets
Tangible fixed assets are stated at acquisition value.
Financial fixed assets
financial fixed assets consist of ownership rights (shares) held in other businesses with a view to creating
lasting and specific ties with those businesses, so as to enable the company to influence their orientation
and policy.
financial fixed assets are stated at acquisition value, applying the weighted average prices method.
in accordance with the principle of accounting continuity, historical book values have been retained for
participating interests obtained through the contribution of sectors and/or a totality of assets.
financial fixed assets may be revalued in the event that their value, determined in accordance with their
utility to the company, comes to exceed their book value in a clear and lasting manner.
Downward adjustments in value may be effected in the event of a lasting decrease in value or depreciation,
justified by the circumstances, profitability or prospects of the company in which the shares are held.
Additional acquisition costs are charged directly to the results.
Amounts receivable and creditors
Amounts receivable and creditors are stated at nominal value.
Downward adjustments in value are effected if uncertainty exists as to the payment of all or part of an
amount receivable on the due date.
Investments
investments are stated at nominal value where they comprise a positive balance at a financial institution,
and at their acquisition value in the case of securities.
Acquisition value is determined using the individualisation method.
Additional acquisition costs in the case of securities are charged directly to the result.
in the case of fixed-income securities, where the acquisition value differs from the redemption value, the
difference between the two is included in the result in proportion to the securities’ remaining term to
| 6 1 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
maturity as an element of the interest income on the securities in question, and is added to or deducted
from the acquisition value of the securities, as the case may be. inclusion in the results occurs on an up-to-
date basis, reflecting the actuarial return on purchase.
in the case of non-fixed-income securities (primarily equities), downward adjustments in value are effected
if the sale value as at the balance sheet date is lower than the acquisition value.
Cash at bank and in hand
Cash at bank and in hand (current account balances) is stated at nominal value.
Capital, revaluation gains and reserves
Capital, revaluation gains and reserves are stated at nominal value.
Revaluation gains are transferred to taxed reserves in the event that the asset in question is realised.
provisions and deferred taxes
The purpose of provisions is to cover, according to their specific character, clearly defined losses or costs
which, as at the balance sheet date, are likely or certain to be incurred but the amount of which has yet to
be determined. Provisions are withdrawn if they cease to be fully or partially necessary.
Other asset or liability elements are stated at acquisition value.
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 6 2 |
4.5 Auditors’ report
Statutory auditors’ report to the General Meeting of Shareholders of KBC Ancora SCA on the financial
statements for the year ended 30 June 2011
in accordance with legal and statutory requirements, we hereby report to you on the performance of our
audit mandate. This report includes our opinion on the financial statements together with the required
additional comments.
unqualified audit opinion on the financial statements with explanatory note
We have audited the financial statements of KBC Ancora SCA for the year ended 30 June 2011, prepared in
accordance with the financial reporting framework applicable in Belgium, which show a balance sheet total
of EUR 2,589,828,066.09 and a profit for the year of EUR 30,166,997.67.
The management of the Company is responsible for the preparation of the financial statements. This
responsibility includes designing, implementing and maintaining internal control measures relevant to the
preparation and fair presentation of financial statements that are free from material misstatement, whether
due to fraud or error; selecting and applying appropriate accounting policies; and making accounting
estimates that are reasonable in the circumstances.
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted
our audit in accordance with legal requirements and auditing standards applicable in Belgium, as issued by
the ‘institut des Réviseurs d’Entreprises/instituut der Bedrijfsrevisoren’. Those standards require that we plan
and perform our audit so as to obtain reasonable assurance as to whether the financial statements are free
from material misstatement.
in accordance with these standards, we have carried out procedures to obtain audit evidence about the
amounts and disclosures in the financial statements. The procedures selected depend on our judgment,
including the assessment of the risks of material misstatement in the financial statements, whether due
to fraud or error. in making those risk assessments, we have considered internal control measures relevant
to the Company’s preparation and fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on
the effectiveness of the Company’s system of internal control. We have also evaluated the appropriateness
of the accounting policies used, the reasonableness of accounting estimates made by the Company and the
presentation of the financial statements, taken as a whole. finally, we have obtained from management and
responsible officers of the Company the explanations and information necessary for our audit. We believe
that the audit evidence we have obtained provides a reasonable basis for our opinion.
in our opinion, the financial statements as at 30 June 2011 give a true and fair view of the Company’s net
worth, financial position and results in accordance with the financial reporting framework applicable in
Belgium.
Without prejudice to our opinion as set out above, we would draw attention to the fact that the value of the
assets of KBC Ancora SCA, as well as its results, are largely influenced by developments in relation to KBC
Group, and therefore also by the specific risks to which KBC Group is exposed.
| 6 3 | A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1
Additional comments
The preparation of the management report and its content, as well as the Company’s compliance with
the Belgian Companies’ Code (Code des sociétés) and the Company’s Articles of Association, are the
responsibility of the management.
Our responsibility is to supplement our report with the following additional comments, which do not
modify our audit opinion on the financial statements:
• The annual report includes the information required by law and is consistent with the financial
statements. however, we are unable to make any pronouncement on the description of the chief risks
and uncertainties confronting the Company, nor about its position, its foreseeable development or
the material influence of certain facts on its future development. We can nevertheless confirm that
the matters disclosed do not present any obvious inconsistencies with the information of which we
became aware during the performance of our audit.
• Without prejudice to formal aspects of subordinate importance, the accounting records have been
kept in accordance with the statutory and administrative rules applying in Belgium.
• No actions have been performed or decisions taken of which we need to inform you that contravene
the Articles of Association or the Belgian Companies’ Code (Code des sociétés). The treatment of the
result proposed to the General meeting of Shareholders corresponds with the provisions of the law
and the Articles of Association.
Kontich, 29 August 2011
Klyveld Peat marwick Goedeler Bedrijfsrevisoren
Auditors
represented by
Erik Clinck
Auditor
A n n u A l R e p o R t 2 0 1 0 / 2 0 1 1 | 6 4 |
5 ColophonKBC Ancora SCA
Registered office
Philipssite 5/10
B-3001 Leuven
Belgium
Tel.: +32 (0)16 27 96 72
fax: +32 (0)16 27 96 94
Website: www.kbcancora.be
Editorial staff
Jan Bergmans
Luc De Bolle
franky Depickere
Kristof Van Gestel
Coordination of figures
Ann Thoelen and Els Lefèvre
Design, printing and finishing
Lannoo Drukkerij, Tielt
Cover photo and layout
Raf Berckmans
Translation
Julian Ross
Coordination
Jan Bergmans and fran De Cock
final editing
Jan Bergmans
Responsible publisher
KBC Ancora SCA
hilde Talloen, Philipssite 5/10, B-3001 Leuven
Company number RPR Leuven VAT BE 0464.965.639
KBC Ancora’s annual report is available in Dutch, french and English from the company’s registered office or
on its website www.kbcancora.be. Conformity between the translations and the original annual report has
been checked by KBC Ancora, which assumes responsibility in this regard. in the event of discrepancies or
differences of interpretation, the Dutch version alone shall be legally binding.
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