Erste Group Bank (EBS) H2 2024 earnings summary

Executive summary

• Fourth consecutive record annual net profit above €3.1bn; all 2024 financial targets achieved, with organic loan and deposit growth at mid-single digits.

• CEE generated 66% of 2024 net profit, up from 57% in 2023, and drove strong performance.

• Strong revenue momentum kept net interest margin near 2.5% despite falling rates; management expressed confidence in further growth in 2025.

• Strategic priorities include digital advice, efficiency, asset management expansion and selective M&A.

Financial highlights

• Operating income rose 5.9% to €11,178m; net interest income grew 4.2% and net fee and commission income 11.3% in 2024.

• Net profit exceeded €3.1bn; net result increased 4.3% YoY, RoTE was 16.3% and FY24 EPS reached €7.20.

• Operating expenses increased 5.2%, mainly reflecting higher IT and personnel investment; FY24 cost/income ratio was 47.2%.

• Deposits grew 3.8% and net loans 4.9% YoY; Q4 net interest income rose 7.3% YoY to above €1.9bn.

Outlook and guidance

• FY25 targets: RoTE ~15%, loan growth ~5%, flattish NII and mid-single-digit fee growth.

• FY25 operating expenses are expected to rise ~5%; cost/income ratio should remain below 50%, with only a small temporary efficiency decline.

• FY25 risk costs are guided at ~25 bps; NPL ratio and coverage are expected to remain near current levels.

• CEE GDP growth is forecast at 2.6% in 2025; loan growth is expected to remain robust, especially in Romania, Czechia and Croatia.