Almanij Nv

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Almanij Nv

Keizerstraat 8
B-2000 Antwerp
Telephone: ( + 32) 3-202-87-00
Fax: ( + 32)3-23-14-409
Web site:

Public Company
Employees: 42,809
Total Assets: EUR 19.58 billion ($17.33 billion)(2000)
Stock Exchanges: Euronext Brussels
Ticker Symbol: ALM
NAIC: 551111 Offices of Bank Holding Companies

Almanij NVshort for Algemene Maatschappij voor Nijverheidskrediet (General Company for Industrial Credit)is one of Belgiums leading financial and insurance holding companies. Almanij operates in the financial services and insurance sectors through majority and controlling shares in a number of more-or-less independently operating companies. With assets of more than EUR 200 billion, Almanij intends to remain a medium-sized and independent player in the rapidly consolidating European financial industry. The primary components of Almanijs holdings are KBC Bank & Insurance Group; KB Luxembourg; Gevaert; Almafin; and Investco. Most of the companys primary holdings are also publicly listed companies. KBC is one of the leading Belgium companies in its sector, with a 20 percent share of the domestic market, and has also built a strong position in the Central European market, notably in Poland, the Czech Republic, Slovakia, and Hungary. Almanijs position totals nearly 73 percent of KBCs shares. KB Luxembourg is 60 percent owned by Almanij and offers private banking services throughout Europe, notably through such subsidiaries as Henry Cooke Group and Brown, Shipley & Co. in the United Kingdom, Urquijo in Spain, sKempf in France, and Merck Finck & Co. in Germany. Investment company Gevaert, formerly part of Agfa-Gevaert and still a major shareholder in that imaging technology company, is 79 percent-owned by Almanij. Almafin is a 100 percent-owned subsidiary that develops specialty financing products, such as leasing products for the leisure and theme parks industry, and other leasing operations, such as those of modular office space and transportation equipment, such as containers. Lastly, Investco, part of KB Luxembourg, operates lending services to the small- and mid-sized business sector. Almanij is itself owned in large part by banking cooperative CERA Holding, which spun off nearly 30 percent of its Almanij shares as the publicly listed Almancora investment vehicle. Almanij is led by chairman Jan Huyghebaert and managing director Ferdinand Verndonck and trades on the Euronext Brussels stock exchange. In 2001, Almanij acknowledged that it was considering a merger with KBC to aid in simplifying the organizational structure of both companies.

Developing Belgium Banking in the Early 20th Century

The Almanij organization entering the 21st century culminated more than 100 years of Belgian banking and insurance history. The holding company was the product of a series of mergers, and particularly the late 1990s mergers of Algemeene Bankvereeniging and Kredietbank with CERA and ABB Verzerkeringen, which formed KBC Bank & Insurance Group.

Kredietbank had its roots in the late 19th century. The bank, which grew into one of Belgiums largest, was originally founded in 1889 as the Volksbank van Leuven as a cooperative partnership operating in Flemish-speaking Belgium. The bank reformed as a limited company after World War I and began to expand throughout the Flanders region. During this period, the Volksbank created a number of subsidiary banks, including the Bank voor Handel en Nijverheid (Bank for Business and Industry) in Kortrijk and the Algemeene Bankvereeniging (General Banking Association) in Antwerp. The Volksbank, which became part of the Middenkredietkas (Central Credit Fund) was also instrumental in financing the setting up of a number of other banks.

The Middenkredietkas had been set up in 1895 as a central savings and investment fund for the growing numbers of Spaaren Leengilden (savings and loan associations) being formed in Belgium in the early 1890s following the banking model established by FW Raiffeisen of Germany. As part of its investments, the Middenkredietkas began building up a portfolio of banking groups, such as Volksbank and Algemeene Bankvereening.

The financial crisis of the 1920s, which led to the worldwide depression in 1929, forced the restructuring of much of the Belgian banking industry. The Algemeene Bankvereeniging, which, along with its commercial banking operations, had built up a wide range of financial and industrial assets both in Belgium and abroad, notably in Hungary, restructured its assets into a new holding company, the Algemene Maatschappij voor Nijverheidskredietor Almanij, for short. The new company was incorporated in 1931.

Almanij soon became the parent of its own parent company. Throughout the difficult economic climate of the 1920s, Middenkredietkas had been growing steadily, principally through a long series of mergers and acquisitions of smaller banks facing financial troubles. When Middenkredietkas itself nearly collapsed in the mid-1930s, the Belgian government agreed to a vast restructuring of that holding company. The resulting restructuring created a new, independent bank, Kredietbank. As part of the restructuring process, Almanij sold off its industrial assets and in exchange took up a position as Kredietbanks majority shareholder. Kredietbank saw steady expansion throughout the rest of the decade and into the next, becoming a major fixture on the Belgian banking scene.

An offshoot of the creation of the Kredietbank was the launch of what was to become a primary part of CERA Holding. The restructuring had grouped commercial banking operations under Kredietbank. At the same time, the Centrale Kas voor Landboukrediet was formed to take over the Middenkredietkass central savings and investment fund activities for its network of savings and loan associations. The locally operating Spaar- en Leengilden branches then changed their name to Raiffeisenkassen, and grew to a network of 800 independent branches.

The third member of the later KBC merger, ABB Verzekeringen, also had its start in the early 1890s. Belgiums Boerenbond (Farmers Union) began offering fire insurance to its members in 1892, through Englands Norwich Union. In 1898, the Boerenbond added accident insurance as well, now through La Belgique Industrielle. At the turn of the century, however, the Boerenbond itself entered the insurance business, setting up its own cooperative policies, Ondelinge Belgische Boerenverzekering, which covered work-related accident insurance, and Landbouwverzekering for other accident insurance coverage, in 1905. The Boerenbond extended its insurance operations in 1917 with the creation of its own fire insurance group. In 1922, the unions various insurance operations were combined into a single limited liability company, Belgische

Onderlinge Verzekeringsmaatschappij NV, which was subsequently renamed Verzekeringsmaatschappij van de Belgische Boerenbond to emphasize that the company was part of the farmers union. At the beginning of World War II, the company changed its name again, becoming Assurantie van de Belgische Boerenbond, or ABB Verzekeringen. ABB later came under the control of CERA, which became a major shareholder.

Postwar Growth

ABB, Kredietbank, and Almanij all enjoyed steady growth during the post-war years as Belgiums economy, largely spared the destruction of the World War II, rapidly returned to steady growth. ABB grew from a relatively small insurance company into one of the countrys top four insurers, with more than 1,000 agencies and international activities, primarily in Luxembourg, Hungary and Ireland. Kredietbank expanded to national prominence. Under the motto an independent bank for an independent clientele, The Almanij-Kredietbank consortium moved beyond its Flanders home base beginning in 1958 to build up a strong share of French-speaking Belgium as well to capture the number three position in the countrys banking industry. Kredietbank also turned to the international market, notably with the creation of Kredietbank SA Luxembourg in 1949. That operation, later known as KBL, became one of the four cornerstones of the Almanij group.

Centrale Kas voor Landbouwkrediet changed its name to Centrale Raiffeisenkas in 1970. New legislation at the beginning of that decade, however, led to dramatic changes in the organization. Facing new rules governing the operation of partnerships, the 800 independently operating member partnerships of the Centrale began to reduce their numbers through mergers. This process was stepped up in 1985, and the group changed its name to CERA Bank in 1986.

By then KBL had been launched as an independent company, after Almanij, in part in response to fears that the Belgian banking industry might face a privatization effort akin to its French counterpart, broke off the Luxembourg-based company from Kredietbank in 1978. This move became part of an overall effort to refocus Almanij around three core operations: Kredietbank, KBL, and an increasing interest in insurance companies, notably around subsidiary Fidelitas, and the specialized finance sector.

New rules governing the Belgian banking industry were laid down at the beginning of the 1990s. CERA, which had operated as a savings institution, was now granted the right to convert to full bank status in 1991. At the same time, the new legislation increased the ability of majority shareholders to guide a banks direction, and Almanij began to take a more active role not only in developing strategy among its banking holdings, but also in raising funds for growth. A primary target for the company became the newly liberated Central European countries.

Company Perspectives:

The companys mission is to focus on profitable growth with stable shareholders fostering long-term value creation while abstaining from operational intervention.

21st Century Belgium Financial Services Leader

Almanij added a new wing to its holdings in 1997 when it acquired a 79 percent position in Belgian investment company Gevaert. That company had formerly been part of the Agfa-Gavaert firm, founded in 1894 and moved to Germany in 1964.

When Bayer acquired the imaging unit of Agfa-Gavaert in 1981, Gavaert was spun off as a separate company, with, Almanij acquiring a strong shareholder position. Gavaert expanded its investment operations throughout the 1980s and 1990s. In 1997, Almanij and majority shareholder Copeba agreed to break up Gavaert into two parts, with Almanij acquiring the Gavaert name and its public listing as well as its expertise in the investment field.

The following year Almanij was catapulted to the top ranks of the Belgian financial world with the announcement of a merger agreement with CERA and ABB Verzekeringen. Almanij joined Kredietbank, as well as Fidelitas and other of its holdings, into the new company, called KBC Bank & Insurance Group, in exchange for a nearly 74 percent share; in return, CERA obtained more than one-third of Almanijs stock. These shares were placed under a newly created entity, CERA Holding. The merger made KBC the leading Belgian banking and insurance group, and a leader in the rapidly expanding Central European market as well.

Almanij now regrouped around three principal holdings, namely Gaveart, KBC, and KBL. As it moved toward a more streamlined organization, Almanij now turned to a number of its smaller holdings, which turned more to specialized finance operations, such as leasing for the theme parks and leisure industries, or the companys specialized Immolease subsidiary. In 1999, these subsidiaries were grouped under a single entity, called Almafin, which remained 100 percent controlled by Almanij.

In April 2000, Almanijwhich had been nurturing acquisition ambitions for French banking group Crédit Commercial de Francewas taken by surprise when HSBC launched an EUR 11 billion takeover of CCF. Almanij, admitting to being disappointed by the move, sold off its own stake in CCF, which included an 18 percent position held by KBC. KBC quickly bounced back, acquiring Keijser Effecten, a securities company based in the Netherlands, in June 2000, then joining with EDS to set up the Fin-Force joint-venture for the processing of international payment transactions in the new European currency.

At the beginning of 2001, Almanijs major shareholder, CERA Holding, moved to increase the liquidity of its holding, spinning off 25 percent of its shares into a newly created, publicly listed entity, Almancora, which listed on the Euronext Brussels exchange. Almanij was also moving toward a more simplified organizational structure, transferring its Investco subsidiary to KBC. By mid-2001, Almanij began to seek means to correct what many saw as the undervaluing of KBCs stocka result of the relatively small proportion of free-float shares available. Almanij acknowledged the potential of a merger between Almanij and KBC, most likely in the direction of Almanij acquiring KBC. Such a move would boost the number of free-float shares in the new company above the 50 percent mark, making the stock a more attractive investment. Whether Almanij intended to go ahead with the plan remained to be seen; nonetheless, as the European financial community underwent a wave of mergers at the turn of the century, Almanij remained committed to remaining mid-sized and independent for the new century.

Principal Subsidiaries

Almafin NV; Gavaert NV; Incestco NV; KBC Bankverszekeringsholding NV; Kredietcorp SA; Via KBC Bank: Antwerpse Diamantbank NV (59.11%); Assurisk SA (Luxembourg) (67.81%); CBC Banque SA (67.81%); Centea NV (67.51%); Krefima NV (67.46%); â eskoslovenská Obchodní Banka AS (SOB) (Czech Republic)(55.30%); KBC Finance (Ireland) (67.81%); IIB Bank Ltd. (group)(Ireland)(67.81%); KBC Asset Management NV (67.81%); KBC Asset Management Ltd. (Ireland)(67.81%); KBC Bank NV (67.81%); KBC Bank AG (Germany)(67.36%); KBC Bank Funding LLC & Trust (group) USA 67.81 KBC Bank Nederland NV (Netherlands)( (67.81%); KBC Clearing NV (Netherlands)( 50.87%); KBC Exploitatie (67.81%); KBC Financial Products (group) (67.81%); KBC International Finance NV (Netherlands Antilles)( 67.81%); KBC Lease NV (group) (67.810%); KBC Securities NV (67.81%); KBC Securities France SA (France) (67.81%); KBC Securities Nederland NV (Netherlands)(67.81%); Kereskedelmi és Hitelbank Rt. (K&H Bank) Hungary (49.69%); Patria Finance AS Prague (Czech Republic (62.32%); Kredietbank SA Luxembourgeoise (Luxembourg)(57.55%); Brown, Shipley & Co. Ltd. UK (57.55%); Henry Cooke Group plc UK (57.55%); KB Luxembourg Finance Dublin Unltd. IE (57.55%); KB Luxembourg (Monaco) SA (57.55%); Banque Continentale du Luxembourg SA (Luxembourg; 57.55%); Banque Continentale du LuxembourgRoyal (Private) (Luxembourg; 57.55%); KBL France (57.55%); KBL Beteiligungs AG (Luxembourg)(57.55%); Merck Finck & Co (Luxembourg; 57.55%); Banco Urquijo SA (Spain;40.56%).

Key Dates:

Founding of Volksbank van Leuven, which later becomes part of Middenkredietkas.
Boerenbond (Farmers Union) begins offering fire insurance to its members, forming basis of later ABB Verzekeringen.
Formation of Middenkredietkas as central savings and investment fund.
Middenkredietkas subsidiary Algemene Maatschappij voor Nijverheidskrediet (Almanij), restructures as holding company.
Restructuring of Middenkredietkas creates Kredietbank with Almanij as parent company and spin-off of Centrale Kas voor Landboukrediet.
Almanij forms Kredietbank luembourg (KBL).
Centrale Kas voor Landboukrediet becomes Centrale Raiffeisenkas.
Almanij spins off KBL as independent company.
Centrale Raiffeisenkas becomes CERA Bank.
CERA takes on full bank status.
Almanij, CERA, and ABB Verzekeringen merge to form KBC with Almanij as major shareholder.
Almanij begins considering merger with KBC.

Principal Competitors

Berkshire Hathaway Inc. (BRK); Ifi Istituto Finanziario Industriale S.p.A.; Investor AB; Cobepa S.A.; Fortis; ING Groep N.V.

Further Reading

Bollen, Nadine, Almancora druk verhandeld op eerste beursdag, De Tijd, April 4, 2001.

Buckley, Neil, KBC Puts a Brave Face on CCF Setback, Financial Times, April 14, 2000.

Dombey, Daniel, KBCs 20% Increase Matches Expectations, Financial Times, March 6, 2001.

Fusie Almanij-KBC brengt free float van bankgroep boven 50 procent, De Financieel-Economische Tijd, July 6, 2001.

Mann, Michael, KBC Confident of Profits Increase, Financial Times, September 4, 2001.

Putman, E., J. Daniëls, and I. Van Thielt, ABB, een Geschiedenis van Verzekeren. Leuven, ABB Verzekeringen, 1997, 173 p.

Van Der Wee, H. and M. Verbreyt, Mensen maken geschiedenis: de Kredietbank en de economische opgang van Vlaanderen: 1935-1985. Brussel, Kredietbank, 1985, 356 p.

M.L. Cohen