National Bank of Greece (ETE) Q1 2025 earnings summary

Executive summary

• Q1 2025 profit after tax reached €381m, with normalized EPS at €1.44 and ROTE at 16.5%, both exceeding full-year guidance of over 13%.

• Maintained a highly liquid and well-capitalized balance sheet, with CET1 at 18.7% and total capital ratio at 21.5%, both up 40 bps quarter-on-quarter.

• Performing loans grew 12% year-on-year to €33.6b, with loan disbursements up 41% to €1.6b, mainly driven by corporates.

• Transformation program and digital innovation, including a core banking system upgrade, continue to drive operational efficiency and customer experience.

• Asset quality remains robust with NPE ratio at 2.6% and NPE coverage at 97.5%, among the best in Europe.

Financial highlights

• Net interest income (NII) declined 9% year-on-year to €548m, but net interest margin stayed strong at 291bps, above 280bps guidance.

• Fee income grew 13% year-on-year, driven by investment product cross-sell and strong retail/corporate performance.

• Operating expenses rose 5–7% year-on-year due to higher personnel costs and IT investments.

• Cost-to-income ratio was 30% (33% normalized), outperforming the 35% full-year guidance.

• Cost of risk normalized at 46bps, with NP/NPE ratio at 2.6% and coverage at 97.5%.

Outlook and guidance

• FY25 guidance reaffirmed: ROTE >13%, NIM >280bps, cost of risk <50bps, payout ratio at 60%.

• Performing loan growth expected at ~8% CAGR, NPE ratio to fall to ~2% by 2027, and CET1 to remain >18% post payouts.

• OpEx growth to normalize to 5% year-on-year as voluntary exit scheme benefits materialize.

• Payout levels to remain at ~60% of profits, with double-digit payout yields supported by share buybacks.

• Greek economy expected to grow by 2.5% in 2025, supported by employment, wage growth, and tourism.