National Bank Of Greece S.a. · ATHEX:ETE
National Bank Of Greece — Debt Investor Presentation (September 2023)
45 slides from National Bank Of Greece's debt investor presentation, September 2023
Slide 1: Fixed Income Presentation Credit Update
Fixed Income Presentation Credit Update September 2023
Slide 2: Disclaimer
Disclaimer Not an Offer for Sale This presentation, which has been prepared by the National Bank of Greece (the Bank), is confidential and is being made available to selected recipients only and solely for the information of such recipients. This presentation may not be published, redistributed, tra
Slide 3: Table of Contents
Table of Contents 1 Key Financial Highlights 2 Profitability 3 Capital, MREL and Liquidity 4 Asset Quality 5 Macro 6 Appendix
Slide 4: Key Financial Highlights
NATIONAL BANK OF GREECE 1 | Key Financial Highlights
Slide 5: All profitability and balance sheet metrics continue to improve
All profitability and balance sheet metrics continue to improve Core income 1H23 €1.230m 1H23 Core PAT1 €508m PE Loans2 +€0,8b Profitability and +60% yoy 3,6x yoy at €27,4b | +3% yoy Operating performance C:CI 32% 1H23 Core RoTE 16,2% Disbursements 2Q23 €1,4b -18ppts yoy +10,9pps yoy +22% qoq CET1 F
Slide 6: Strong momentum for a fifth consecutive quarter in core income
Strong momentum for a fifth consecutive quarter in core income, combined with cost discipline and risk containment Profitability “jaws” | € m Core profitability | € m 646 +57% 584 830 2,2x 510 yoy Core PPI 527 436 +17% 384 448 qoq 398 383 Core 373 Income 288 Loan & other -113 -121 -151 impairments 2
Slide 7: Sustained core income momentum drives 2Q23 RoTE to 18%
Sustained core income momentum drives 2Q23 RoTE to 18%¹ Cost to Core Income | % Core PAT | € m updated <35% 56% FY23 288 52% guidance 49% previous 220 c42% 45% 190 43% 142 34% 73 31% 69 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 EPS² | € Core RoTE | % 1,26 18,0% 0,96 14,3% 13,1
Slide 8: Updated Guidance FY25: targeting a sustainable core RoTE of >13%
Updated Guidance FY25: targeting a sustainable core RoTE of >13% Financial performance metrics Actual Previous Guidance Updated Guidance Group 6M23 FY23 FY25 FY23 FY25 PE loan growth¹ +3% +7% CAGR +7% CAGR NPE ratio² 5,3% c5% c3% c5% c3% S3 coverage 54,5% >50% >50% >50% >50% NIM (bps) 278 >240 >210
Slide 9: Ratings on a clear upwards trajectory
Ratings on a clear upwards trajectory BBB- BB+ Greece’s and NBG’s average ratings evolution BB BB- B+ B B- CCC+ CCC CCC- CC/C D Q4 Q4 Q4 Q4 Q4 Q4 Q4 Q4 Q4 Q4 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Highest ratings and positive outlooks in GREEN Lowest ratings and negative outlooks in RED G
Slide 10: NBG ranks 5th among participating EU banks in EBA's 2023 stress test
NBG ranks 5th among 70 participating EU banks in EBA's 2023 stress test Stress test results highlights FL CET1 evolution (%): ST 2023 vs 2021 Baseline Scenario +580bps 19,80% 21,60% vs ✓ NBG successfully completed the 2023 EU wide stress test 17,70% +271bps conducted by EBA and ECB 15,80% 14,30% 15,
Slide 11: Profitability
NATIONAL BANK OF GREECE 2.| Profitability
Slide 12: A high-quality balance sheet underscores our unique comparative advantage
A high-quality balance sheet underscores our unique comparative advantage Group Assets1 (€b) Group Liabilities1 (€b) Interbank 1,5 Cash & reserves 5,7 Excess liquidity at €7b, factoring in TLTRO repayment and net interbank Interbank 2,7 position ✓ c77,5% Retail ✓ c19,2% Corporate Securities portfoli
Slide 13: 1H23 Group COP is driven by the sharp pick up in NII
1H23 Group COP is driven by the sharp pick up in NII, with the rest of core lines supportive Group core operating profit bridge 1H23 (€ m) Group operating profit decomposition 1H23 (€ b) COP (€m) 234 398 710 3.0x yoy 3,0x yoy COP margin (bps) 152 440 +288bps yoy +€21m yoy excl. impact of merchant ac
Slide 14: Continued 2Q23 PE NII recovery benefits from base rate driven repricing
Continued 2Q23 PE NII recovery (+12% qoq) benefits from base rate driven repricing; NIM up by c40bps qoq Domestic NII (€ m), Group NIM (bps) Domestic NII breakdown (€ m) +37bps qoq NII 294 328 401 474 529 297 NIM¹ (Group) 260 212 155 173 Loans (PE) 264 336 178 +72bps Loans (NPE) qoq Securities 3M Eu
Slide 15: Disbursements reach €1,4b in 2Q23
Disbursements reach €1,4b in 2Q23; 2H23 pipeline will lead to strong PE expansion during the remainder of the year Greek loan evolution | performing loans (€ b) Bank Loan disbursements¹ (€ b) 0,8 0,4 0,6 27,6 27,6 0,2 27,4 26,5 26,5 +€0,8b 0,3 0,2 +3% yoy 2,7 0,0 0,1 0,1 Apr23 May23 Jun23 +€1,3b 2,1
Slide 16: PE lending spreads lower as pass through of higher ECB rate stands around 70%
PE lending spreads lower as our pass through of higher ECB rate stands at around the 70% mark Greek PE lending spreads¹ (bps) Greek NPE NII%, Loan yield Total 309 295 275 269 260 Performing ² Dom. NPE NII⁴ /Dom. NII % 5,9% 4,4% 3M Euribor -35 50 178 264 336 3,5% (avg) 1,4% FY20 FY21 FY22 1Η23 779 76
Slide 17: Domestic fees grow by +16% yoy
Domestic fees grow by +16%1 yoy, with double digit growth in both the retail and corporate lines of business Domestic fees (€ m) Domestic retail fees decomposition (€ m) Fees/Assets 41bps 47bps YoY YoY 170 +6% +16%¹ 96 +12% 160 86 13 -22% 13 +19% 17 Deposits 11 61 +6% +14%¹ 24 +11% Payments 58 22 Re
Slide 18: Cost discipline intact: C:CI drops to 31% in 2Q23
Cost discipline intact: C:CI drops to 31% in 2Q23; Personnel and G&As at +1% yoy despite inflation and wage increases Group Cost-to-Core Income (%) Group headcount¹ evolution (# k) Cost/ core 19,8 income % 50,1 32,5 58.9 30,7 56.9 55.2 -17,6ppts yoy -3,7ppts qoq 7,8 6,7 at Bank level Personnel cost/
Slide 19: Capital, MREL and Liquidity
3 Capital, MREL and Liquidity
Slide 20: Strong profitability sustains organic capital generation at c80bps per quarter
Strong profitability sustains organic capital generation at c80bps per quarter since the beginning of the year 2Q23 FL capital movement1 Organic capital generation at c80bps in 2Q23 and c160bps in 1H23 18,4% 17,6% +c.0,9% c0,0% 16,8% CCoB – 2,50% CAD FL CCyB – 0,03% -0,1% 14,53% O-SII – 1,00% Includ
Slide 21: NBG is meeting the binding interim MREL target
NBG is meeting the binding interim target – capital trajectory and additional issuance will support a linear build-up Evolution of MREL capacity vs targets (% of RWAs) MREL Target CBR Own funds Eligible Liabilities 27,06% ▪ Single point of entry and issuance from Parent Company National Bank of Gree
Slide 22: Superior net cash position highlights NBG's liquidity advantage
Superior net cash position highlights NBG’s liquidity advantage; TLTRO balance down to just €1,9b TLTRO, Cash & reserves, Net Interbank (€ b) Funding structure (%) TLTRO Group Deposits of Cash & reserves 3% c€56b comprise Net Interbank 3% c98% of total net 17,6 Current,sight & other funding 15,3 5,7
Slide 23: Deposits rebound in 2Q23
Deposits rebound in 2Q23, fully reversing 1Q23 corporate drawdowns Group deposits evolution (€ b) Greek deposit spreads against avg 3M euribor (bps) Group 54,3 55,7 55,2 54,8 55,7 +€1,4b yoy SEE & 1,7 1,7 1,8 1,8 1,9 Demand Other 331 260 176 Average +€1,2b yoy despite balance <€4k 53,9 53,8 Corporat
Slide 24: Deposits substitution eases substantially in 2Q23
Deposits substitution eases substantially in 2Q23; core/total depos still at 80% NBG Deposits¹ flows ytd (€ b) NBG Deposits¹ mix (%) +€0,4b 3% 4% 4% 3% 3% 13% 12% 12% 16% 18% 2 other Time Core 84% 84% 84% 81% 80% -€0,4b +€0,8b 1Q23 2Q23 2Q22 3Q22 4Q22 1Q23 2Q23 & other & other 1. Domestic level | 2.
Slide 25: Asset Quality
NATIONAL BANK OF GREECE 4| Asset Quality
Slide 26: Small pick up in mortgage arrears in 2Q23
Small pick up in mortgage arrears in 2Q23 Domestic NPE stock per category | 2Q23 (€ b) NPE balance change (€ b, Bank) o/w: €0,3b or c40% <30dpd 1,1 o/w: €0,2b or 0,1 0,1 0,2 c45% <30dpd 0,8 NPE inflows (+) 0,1 0,1 -0,1 -0,1 -0,1 Curings -0,1 0,4 0,5 -0,2 -0,0 -0,0 -0,1 -0,0 0,2 0,2 Debt fgv, recover
Slide 27: Likely to cure FNPEs <30dpd at €0,6b
Likely to cure FNPEs <30dpd at €0,6b on a total NPE stock of €1,7b Domestic NPE ratios and coverage | 2Q23 Domestic 90dpd – NPE bridge (€ b) | 2Q23 Collateral 88% 7% 82% 68% 71% coverage1 1,7 +0,1 +0,6 +0,05 15% 0,9 10% 90dpd FNPE <30 FNPE 31-90 Other impaired NPEs NPE ratio 7% 96% 5,3% 5,4% 112% Do
Slide 28: Sector leading coverage levels across all stages
Sector leading coverage levels across all stages Group gross loan stage evolution (€ b) Group S2 ratio and coverage (%) Group S3 ratio and coverage (%) Δ yoy Stage 3 2,1 1,8 1,8 1,8 -0,3 o/w: 14,4% €1,8b FPEs 13,8% 13,6% Stage 2 €2,1b SICR €0,2b +30dpd 12,3% Ratio 4,7 4,5 4,4 4,1 -0,6 Stage 1¹ 6,4%
Slide 29: Macro
NATIONAL BANK OF GREECE 5 | Macro
Slide 30: Economic activity continues on a resilient growth path
Economic activity continues on a resilient growth path, with signs of acceleration in 2Q23 and 3Q23 Economic activity in Greece remained on an upward trend in 1Η23, exceeding in Greece’s economic recovery outpaces the euro area 2Q23 – for a 9th consecutive quarter – the respective euro area average
Slide 31: Declining inflation, favorable business and labor market conditions
Declining inflation, favorable business and labor market conditions, and backloading in public investment • CPI slowed in 2Q23 and July (to a 1½-year low of 2,5%, on average), on the Manufacturing PMI points to accelerating production in back of declining energy prices, despite the inertia of core a
Slide 32: Solid fixed capital investment and rising real estate valuations
Solid fixed capital investment and rising real estate valuations House prices up by 50% in 1Q23 vs their 3Q17 low, but Fixed capital investment on an upward trend still 14% below their historical high of 2008 30 contributions y-o-y 30 20 20 y-o-y 25 in pps 25 15 15 20 20 10 10 15 15 5 5 10 10 0 0 5
Slide 33: Steadily improving labor market conditions support real disposable income
Steadily improving labor market conditions and lower headline inflation support real disposable income Labor compensation on the rise on the back of increasing Unemployment rate at a 14-year low of 10,8% in July, employment and wages employment up by 71Κ persons yoy in 7M23 24 €bn y-o-y 15 4,5 milli
Slide 34: A services-based performance buoyed by tourism
A services-based performance buoyed by tourism and resilient economic sentiment offsets the drag from monetary and fiscal tightening ESI & sectoral confidence indicators in solid expansion territory International arrivals at Athens International Airport (deviation from 15-year average, Greece & Euro
Slide 35: The Greek economy is expected to remain on a resilient growth trajectory
The Greek economy is expected to remain on a resilient growth trajectory Table: Key macros for the Greek economy (annual data) GDP growth projections Key macroeconomic indicators of the Greek Economy 10 y-o-y 10 2020 2021 2022 2023f 2024f Nominal GDP (y-o-y) -9,8 9,8 14,5 7,3 4,8 5 5 2,4 1,9 1,6 Rea
Slide 36: Appendix
NATIONAL BANK OF GREECE 7 | Appendix
Slide 37: Climate & environment strategy, fully embedded into our business strategy
Climate & environment (C&E) strategy, fully embedded into our business strategy C&E strategic themes and recent efforts Examples of impact achieved 1 Lead the market in sustainable energy financing Corporate financing to RES producers (€ b) 1,5 1,6 • Development of new Sustainable Bond Framework 1,1
Slide 38: Continuous reduction in non-financed emissions footprint and energy consumption
Continuous reduction in non-financed emissions footprint and energy consumption Non-financed emissions – market based (ktCO2e) Purchased electricity (MWh) -41% reduction in total non-financed emissions in 2 years -18% reduction in purchased electricity in 2 years 2020 2021 2022 -18% 53.378 49.296 53
Slide 39: Group P&L and key ratios
Group P&L and key ratios P&L | Group Key Ratios | Group €m 1H23 1H22 YoY 2Q23 QoQ 2Q23 1Q23 4Q22 3Q22 2Q22 NII 1.052 600 +75% 554 +11% +14% yoy NIM over avg total assets (bps) 297 260 212 173 155 Net fee & commission income 178 170 +5% 92 +6% excl. impact of merchant Core Income 1.230 770 +60% 646 +
Slide 40: Group Balance Sheet & P&L
Group Balance Sheet & P&L Balance Sheet | Group P&L | Group €m 2Q23 1Q23 4Q22 3Q22 2Q22 €m 2Q23 1Q23 4Q22 3Q22 2Q22 Cash & Reserves 7.551 9.950 14.226 17.572 15.261 NII 554 497 421 348 312 Interbank placements 2.735 2.731 2.900 3.143 2.711 Net fee & commission income 92 87 89 88 86 Securities 15.832
Slide 41: Geographical segment P&L: Greece & International
Geographical segment P&L: Greece & International Greece International €m 2Q23 1Q23 4Q22 3Q22 2Q22 €m 2Q23 1Q23 4Q22 3Q22 2Q22 NII 529 474 401 328 294 NII 25 23 21 20 18 Net fee & commission income 87 83 85 85 80 Net fee & commission income 5 3 4 3 5 Core Income 616 557 485 413 375 Core Income 30 27
Slide 42: ESMA Alternative Performance Measures, definition of financial data and ratios used
ESMA Alternative Performance Measures (APMs), definition of financial data and ratios used The 2Q23 Financial Results Presentation contains financial information and measures as derived from the Group and Bank financial statements for the period ended 30 June 2023 and for the year ended 31 December
Slide 43: Definition of financial data, ratios used and alternative performance measures
Definition of financial data, ratios used and alternative performance measures Na me Ab b re via tio n De fin itio n Assets held for sale -- Non- c urrent assets held for sale Cash and Reserves -- Cash and balanc es with c entral banks Combined Buffer Requirement CBR Total CET1 c apital required to
Slide 44: Definition of financial data, ratios used and alternative performance measures
Definition of financial data, ratios used and alternative performance measures Minorities -- Non-controlling interest Net Interbank -- Due from banks less due to banks, excluding the TLTRO facility Net Interest Margin NIM Net interest income over average assets Net Loans -- Loans and advances to cus
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