Eurobank Ergasias Services and Holdings (EUROB) Q3 2024 earnings summary

Executive summary

• Adjusted net profit reached €1,145m in 9M24, up 24.9% year-over-year, with €498m from regional operations and reported net profit at €1,135m, up 15.8% year-over-year.

• Hellenic Bank was consolidated line-by-line for the first time, expanding the group’s balance sheet to nearly €100bn in assets, €50bn in loans, and €75bn in deposits.

• Group profitability was driven by strong net interest income, higher commission income, and disciplined cost control, despite increased group operating expenses due to consolidation effects.

• Geographic diversification: Greece 60% of assets, Cyprus 27%, Bulgaria 11%.

• EPS reached €0.31; ROTBV at 19.2%.

Financial highlights

• Net profit for the nine-month period reached €1.14bn; net interest income rose 14.3% year-over-year to €1,830m; commission income increased 11.8% to €451m.

• Core pre-provision income grew 14.6% year-over-year to €1,526m; core operating profit up 20.5% to €1,297m.

• Operating costs remained flat in Greece and up 1% for the group, excluding Hellenic Bank; total operating expenses increased 12.1% year-over-year to €754m, mainly due to SEE operations.

• Loan loss provisions decreased 10.1% to €229m; NPE ratio dropped to 2.9% with 89.9% coverage; cost-of-risk at 68bps.

• Deposit volumes increased by €2.3bn; managed funds and private banking up by €1.4bn and €1.9bn, respectively.

Outlook and guidance

• Upgraded full-year estimate for return on tangible book value to 17.5%; return on equity expected around 17.5% for 2024.

• Organic loan growth for 2024 expected to reach €3.5bn, exceeding initial targets by over €1bn.

• NIM for 2024 expected at 281bps, about 20bps above budget.

• For 2025, loan growth expected at 6%-7%, with NII and fee growth supported by strong pipeline and RRF disbursements.

• Management expects continued solid growth, supported by robust macroeconomic conditions in Greece and SEE.