KBC Group
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Glossary

Basic earnings per share
[result after tax, attributable to equity holders of the parent] / [average number of ordinary shares less treasury shares]. If a coupon is paid on the additional tier-1 instruments included in equity, it will be deducted from the numerator.

CAGR
compound annual growth rate.

Combined ratio (non-life insurance)
[technical insurance charges, including the internal cost of settling claims / earned insurance premiums] + [operating expenses / written insurance premiums] (after reinsurance in each case).

Common equity ratio
[common equity tier-1 capital] / [total weighted risks].

Cost/income ratio
[operating expenses of the banking activities] / [total income of the banking activities].

Cover ratio
[specific impairment on loans] / [outstanding impaired loans]. For a definition of ‘impaired’, see ‘Impaired loans ratio’. Where appropriate, the numerator and denominator may be limited to impaired loans that are more than 90 days past due.

Credit cost ratio
[net changes in impairment for credit risks] / [average outstanding loan portfolio].

Diluted earnings per share
[result after tax, attributable to equity holders of the parent] / [average number of ordinary shares plus dilutive options less treasury shares]. If a coupon is paid on the additional tier-1 instruments included in equity, it will be deducted from the numerator.

Dividend payout ratio
[amount of dividend to be distributed plus coupon to be paid on the core-capital securities sold to the government and on the additional tier-1 instruments included in equity] / [consolidated net profit].

Equity market capitalisation
[closing price of KBC share] x [number of ordinary shares].

Impaired loans ratio
[amount outstanding of impaired loans] / [total outstanding loan portfolio]. Impaired loans are loans where it is unlikely that the full contractual principal and interest will be repaid/paid. These loans have a KBC default status of PD 10, PD 11 or PD 12 and correspond to the new definition of 'non-performing' used by the European Banking Authority. Where appropriate, the numerator may be limited to impaired loans that are more than 90 days past due (PD 11 and PD 12).

Leverage ratio
[regulatory available tier-1 capital] / [total exposure measure]. The exposure measure is the total of non-risk-weighted on and off-balance sheet items, based on accounting data.

Liquidity coverage ratio (LCR)
[stock of high-quality liquid assets] / [total net cash outflows over the next 30 calendar days].

Net interest margin of the group
[net interest income of the banking activities] / [average interest-bearing assets of the banking activities].

Net stable funding ratio (NSFR)
[available amount of stable funding] / [required amount of stable funding].

Parent shareholders’ equity per share
[parent shareholders’ equity] / [number of ordinary shares less treasury shares (at period-end)].

Return on allocated capital (ROAC) for a particular business unit
[result after tax (including minority interests) of a business unit] / [average allocated capital of the business unit]. The capital allocated to a business unit is based on the risk-weighted assets for the banking activities (under Basel III) and risk-weighted asset equivalents for the insurance activities (under Solvency II).

Return on equity
[result after tax, attributable to equity holders of the parent] / [average parent shareholders’ equity, excluding certain revaluation reserves

Solvency ratio, KBC Insurance
[available solvency capital] / [minimum regulatory solvency capital].