Belgium’s KBC Group has reported a €601m profit for the third quarter, despite a €319m loss in its Irish arm as it prepares to exit the market here.

The loss includes a one-off impairment charge of €170m and €81m in staff costs, the group said in a statement on its third-quarter results, as well as a one-off loss of €13m related to the tracker mortgage review.

KBC Bank Ireland recently entered into a legally binding agreement to sell €8.8bn in performing mortgages and its €4.4bn deposit book to Bank of Ireland, along with a small number of non-performing mortgages.

That follows a deal this summer to sell its roughly €1.1bn of non-performing Irish loans to US-headquartered investment manager, CarVal Investors.

However, the Group expects to claw back around €200m of its Irish losses once the Bank of Ireland deals close.

The Irish transactions weighed on the bank’s performance in international markets in the three months to September, leading a net result for the group that was €11m down on the previous quarter.

However, KBC said the one-off costs were "more than offset" by the positive impact of a €260m release of previously recorded corona virus-related impairment.

And once the Bank of Ireland deal closes, which is expected in the second half of 2022, the bank’s common equity ratio - a measure of financial health - is expected to improve by 0.9 percentage points.

The legacy of the financial crisis means Irish banks are required to hold more capital against potential losses than their European peers.

Meanwhile, a consumer advisor has said that KBC Bank Ireland borrowers could be left worse off if they try to fix new interest rates with Bank of Ireland after the sale.

Brendan Burgess, founder of the Askaboutmoney consumer finance website, told the Competition and Consumer Protection Commission (CCPC), which is examining the deal, that it will reduce competition in the mortgage market and lead to higher mortgage rates.