KBC to pay coupon on hybrid tier-1 securities, will not call the
outstanding issue on 30 June
In June 1999, KBC Bank issued perpetual non-callable 10-year
preferred securities through KBC Bank Funding Trust II worth 280
million euros (ISIN code XS0099124793). These securities carry a
coupon of 6.875% and qualify as hybrid tier-1 bank capital. Although
KBC did not pay a dividend on its ordinary shares in 2009, it intends
to pay the coupon on the preferred securities on the next coupon date
of 30 June 2009. However, KBC has decided not to exercise its option
to redeem the securities on that date.
In accordance with the offering memorandum, the coupon for the
securities will be adjusted after the call date to a floating rate of
300 basis points above the 3-month EURIBOR, payable in arrears on a
quarterly basis. In light of changing market conditions, KBC intends
to review the possibility to call the securities on a quarterly
basis.
KBC has not yet taken a decision on its call option for two similar
transactions issued by KBC Bank Funding Trust III and KBC Bank
Funding Trust IV and whose first call date is in November 2009.
KBC is fully aware of investors' preferences regarding hybrid
securities and will actively follow up the process of exercising call
options applicable to such securities. The decision to call is
subject to the opinion of the CBFA (the Belgian financial regulator).
Any call notice will be given at least 30 days prior to the call
date.
This announcement was originally distributed by Hugin. The issuer is
solely responsible for the content of this announcement.