KBC Earnings: Strong Results Ahead of Consensus; Valuation Up 7% on Growing Non-NII Exposure

Narrow-moat KBC delivered decent results for the first quarter of 2024, comfortably ahead of company-compiled consensus. Main top-line items outperformed the previous quarter and the respective period of the last year. The strongest growth was recorded in the fee and commission income of 7% year over year, well complemented by 3% in insurance. Net interest margins showed resilience resulting in net interest income, or NII, growth of 3% year over year. KBC managed to get a record result in assets under management inflows and life insurance sales. This contribution is partially attributed to a market tailwind yet in line with KBC's focus on insurance and fee income products. We applaud the ability of the bank to migrate client base from current accounts to mutual funds adding to sticky and long-lived client relationships.