Thus, the object of the transaction consists in all the shares of NN Pension Insurance Company EAD (Bulgaria), as well as all the assets and liabilities of NN Insurance Co. Ltd. - Sofia Branch (Bulgaria).
The transaction is subject to regulatory and antitrust approvals and is expected to close in the course of 2021.
"After careful consideration, we concluded that a divestment of the Bulgarian activities would be in the best interest of our local customers, business partners and employees. We went through a rigorous process to find the right buyer, focusing on a cultural fit and their interest in the continuation of our business. We are confident that KBC is well positioned to further develop the Bulgarian Pension and Life business. This change of ownership is in line with NN's strategy and portfolio review, as announced in June last year", said Fabian RUPPRECHT, CEO of NN International Insurance.
NN Bulgaria has developed its pension and life insurance business since entering the market in 2001. NN Bulgaria has 138 employees, and the customer base consists of over 400,000 individual and 400 corporate clients. The operating result of the Bulgarian business was around EUR 3 million in 2020.
KBC has been present in the Bulgarian financial sector since 2007. In 2009, KBC redefined its strategy to include Bulgaria as one of its core markets - along with Belgium, the Czech Republic, Slovakia, Hungary, and Ireland.
The deal has a total consideration of EUR 77.7 million and will only have an immaterial impact on KBC's solid capital position. Upon closure, KBC Insurance's Solvency II ratio - which stood at an excellent 222% at the end of 2020 - will be reduced by approximately 6 percentage points, but remain well above regulatory requirements, while KBC Group's CET1 ratio will be maintained at an outstanding level (17.6% in 4Q2020, Basel III, fully loaded - Danish compromise).
"I am delighted with this acquisition in Bulgaria. We've become a strong player in this core market, distinguishing ourselves in our banking, insurance, asset management and leasing lines of business. Since our Group's entry in Bulgaria in 2007 our commitment to the Bulgarian market has been firmly stated many times. Today we are taking a next step and adding pension insurance to our already wide-spread presence in Bulgaria. This means that we will be in a position to offer all types of high-end integrated bank-insurance products to our Bulgarian customers. We're extremely happy to acquire a high-quality concern with an excellent reputation and management team, and we are looking forward to developing it in a responsible manner with our other Bulgarian entities, and so affirm our leading position on the Bulgarian financial market", said Johan THIJS, KBC Group CEO.
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