BAWAG Group (BG) Investor Day 2025 (Q&A) summary

Financial guidance and profitability outlook

• Confident in maintaining 20%+ RoTE even if rates fall below 100bps, and 25%+ in current rate environment, driven by structural profitability and asset margin focus.

• NII growth in 2025 is mainly from two acquisitions, with further growth from asset mix and margin recovery through 2027.

• OPEX in 2027 expected to be lower than in 2025, supporting earnings growth to over €1.4 billion.

• Cost of risk guided at ~40bps, with mix effects from acquisitions and normalization post-COVID.

• Tax rate assumed at 26% on average, reflecting geographic mix and recent acquisitions.

Strategic priorities and business development

• Focused on retail and SME, now representing 90% of revenues and franchises, with growth driven by organic expansion and recent M&A.

• Corporate real estate and public sector lending remain niche, with no volume growth assumed in plans.

• Digital distribution exceeds 90% for core products, with most offerings fully digitized end-to-end.

• Consumer growth in Germany will come mainly from the Barclays acquisition, with strong advisory and consumer lending performance across core geographies.

• M&A activity paused for 12-18 months to focus on integration, with future deals considered from 2026 onward.

Capital management and deployment

• Annual excess capital generation of 375bps is based solely on earnings, with SRTs used opportunistically.

• Capital distribution policy prioritizes organic growth and M&A; excess CET1 above 13% distributed via buybacks or special dividends.

• €175 million buyback planned post-Barclays integration, with future distributions dependent on capital position and opportunities.

• €18 billion surplus cash to be deployed patiently, targeting better spread environments and potential securities or lending opportunities.

• Willing to use equity as M&A currency if valuation supports it, but disciplined approach to deal selection remains.