The chief executive of KBC Ireland, Wim Verbraeken, told the Irish Independent that he agreed with a warning from the Central Bank’s Sharon Donnery against so called “write backs”.

Economically, things are improving on the ground here, but trends have yet to be proven over the longer term, he said.

House prices have risen faster than anticipated in 2014 but the retail and hospitality sectors are struggling, Mr Verbraeken said.

KBC has taken a conservative approach to the impact of rising asset values, he added.

The bank took €47m in impairments – money set aside to cover losses – on its boom-era business and home loans in the three months to the end of September.

That compared to €98m in the same period last year.

Two-thirds of the write downs related to business loans and one third is connected to mortgages, Mr Verbraeken.

KBC Ireland will launch a new suite of personal investment products on Monday, as the bank seeks to broaden its retail offering here.

The plan is to use KBC’s existing network of branches, digital outlets and call centres to distribute products linked to parent KBC Group’s €100bn asset management business.

KBC Ireland reported a loss after tax and impairments of €14m for the three months to the end of September, compared to a loss of €51m in the same period last year.

Mr Verbraeken said its new investment products are being introduced in part as a response to the low interest rate environment, which are pushing down returns on ordinary savings.

KBC Group, based in Belgium, reiterated yesterday that a decision on the future of its Irish unit will be taken after the return to profit, which is expected to be in 2016.

In the meantime, its new investment products will be aimed at the broad market, rather than targeted at specific investor types.

KBC has opened new branches in Maynooth, Co Kildare, and Dundrum in Dublin with more expansion planned for next year.

Customers opened 30,000 new accounts in the nine months to the end of September and retail deposits rose to €3.3bn from €2.7bn, the bank said yesterday.

KBC said it had €14.6bn of Irish loans and mortgages at the end of September, down from €15bn at the end of the second quarter.

The bank said it expects loan losses of €150m to €200m in 2014, and of between €50m and €100m in 2015 and 2016.

Excluding losses on historic lending, KBC Ireland would have made a €477m profit in the three months to the end of Septmber.

Profits at KBC Group were €477m in the three months to the end of September.