Belgian bank gets state support

KBC is the third-largest bank in Belgium

Belgian bank KBC has secured a 2bn euros (£1.9bn; $2.58bn) cash injection from the Flemish regional government to help clear its bad debts.

The news saw shares in the lender soar as much as 47%, and KBC chief executive Andre Bergen said the move removed any remaining financial "uncertainty".

The Flemish government has also agreed to give KBC an additional 1.5bn euros over the next five years if necessary.

KBC said it now expects to make a full-year loss of 2.5bn euros for 2008.

This compares with a profit of 3.28bn euros in 2007.

Cutting costs

KBC, which is the country's third-largest bank, had already been given 3.5bn euros from the Belgian federal government in October.

Belgian-French bank Dexia, and Belgian-Dutch bank Fortis also received state financial support last year.

KBC shares had fallen nearly 70% since the start of 2009.

It says it will now concentrate on its home market, cut costs and reduce the number of its riskier investments.

KBC employs around 50,000 people and has 12 million customers.