Kas Bank : H1 2019 Report on the first half of 2019

Chairmans statement

'This period marks an important moment in the history of KAS BANK as we concluded that the changing needs of our clients are best served by teaming up with a large and focused industry player, with international presence and a significant balance sheet. On 25 February 2019, this led to the agreement with CACEIS on a recommended public offer in cash for all securities in KAS BANK. On 26 July, CACEIS formally launched the offer.

The Managing Board and Supervisory Board unanimously support and recommend the offer, as we believe being part of CACEIS will be beneficial to our shareholders, our clients and KAS BANK employees. In the past months the preparations for the integration with CACEIS have already started while at the same time we worked hard to maintain high quality service for our clients. Meanwhile we have also seen that the intended transaction led to increased commercial momentum, and we have started discussions with potential clients. However, until CACEIS declares the offer unconditional (expected September/October 2019) we are a standalone organisation and report accordingly.

In 2019 we welcomed several new clients to KAS BANK in the various segments in our three home markets, which we welcomed after losses of (some larger) clients in previous years and the continuing impact of consolidation of the Dutch pension and insurance market. In the Netherlands, growth is generated in several segments like family offices, investment funds and independent asset managers. This change of our profile will provide a better match with the needs of institutional investors. Apart from adding scale and balance sheet power, we can offer them a broader range of services end hope to trigger the interest of larger pension funds and insurance companies that so far have not selected KAS BANK as their service provider. This should help us in achieving market leadership across all institutional segments. In the UK there is an increasing demand for our cost transparency services where we provide insight into all the costs of participating pension schemes. In Germany, we have welcomed several new clients in the Depotbank segment. We see the client wins, the increase of the number of Requests for Proposal and the positive feedback from our (potential) clients as a strong proof that the institutional market recognises the benefits of KAS BANK becoming part of CACEIS. These positive developments form a solid basis for topline recovery in 2020 and beyond.

In H1 2019 our operating net result decreased to EUR 0.6 million. We saw a strong decrease of our topline due to the above-mentioned losses of clients and the divestment in a Dutch Mortgage Fund in 2018. Our operating cost levels have decreased by 10% compared to 2018. Controlling costs remains an important point of attention for the bank. However, performing an integration alongside the business as usual is not possible without additional costs and investments. The integration with CACEIS will have an impact on our cost levels, both structurally and temporarily.

The bank is in one of the most exciting periods of its longstanding history. We look forward to a future as an integral part of CACEIS and becoming CACEIS' global centre of excellence for the pension fund business, where we have many more options to service our (future) clients optimally while maintaining our identity as a local specialist with an eye for all our clients.'