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%, all 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 40bps quarter-on-quarter.

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

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

• Greek macroeconomic fundamentals remain robust, with GDP growth expected at 2.5% for a third consecutive year.

Financial highlights

• Net interest income (NII) declined 9% year-on-year to €548m, but net interest margin remained strong at 291bps, above 280bps FY25 guidance.

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

• Operating expenses rose 7% year-on-year, mainly from higher personnel costs and IT investments.

• Cost-to-income ratio at 30% (30.3% normalized), outperforming the 35% full-year guidance.

• Cost of risk normalized at 46bps, with 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%.

• Full-year net loan expansion guidance reaffirmed at €2.5b, with strong corporate and improving mortgage pipelines.

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

• 3-year business plan targets NIM >280bps, fee growth >8% CAGR, OpEx growth ~5% CAGR, and ROTE >14% (>18% on internal CET1 target of 14%) by 2027.

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