National Bank of Greece (ETE) Q2 2024 earnings summary

Executive summary

• Core PAT reached €646m in H1 2024, up 27% year-on-year, with attributable PAT at €670m, reflecting strong core income and operational discipline.

• Core ROTE improved to 17.4% in H1 2024, exceeding initial guidance, supported by robust NII and fee growth.

• Loan disbursements hit a multi-year high of €2.8b in Q2 2024, with performing loans up 8% year-on-year.

• CET1 ratio increased to 18.3%, total capital ratio to 20.9%, with a 40% dividend payout accrual for 2024 profits.

• Moody’s upgraded the rating by two notches to BBB, above investment grade, reflecting balance sheet strength and recurring profitability.

Financial highlights

• Net interest income rose 13% year-on-year to €1,192m; fee income up 15% to €205m; cost-to-core income ratio at 30.1%.

• Core pre-provision income increased 18% year-on-year to €976m; core operating profit up 22% to €869m.

• Loan disbursements reached €3.9b in H1 2024; performing loans at €31.4b (+8% yoy); deposits at €57.1b (+€1.4b yoy).

• NIM at 323bps in H1 2024, above previous full-year target.

• NPE ratio at 3.3%, with cash coverage at 86%.

Outlook and guidance

• Upgraded FY24 core PAT guidance to approximately €1.3b, with EPS target at €1.4 and core ROTE above 16%.

• FY24 NII expected to slightly exceed 2023 record, with new guidance at €1.5b.

• Cost of risk revised to below 60bps for 2024; NIM guidance raised to over 300bps.

• 2026 targets: core PAT above €1.3b, NIM above 270bps, normalized ROTE above 18%, CET1 above 14%.

• Dividend payout to increase steadily, with >900bps excess capital providing optionality for shareholder returns.