National Bank Of Greece S.a. · ATHEX:ETE
National Bank Of Greece — Q1 2020 Earnings Presentation
43 slides from National Bank Of Greece's earnings presentation, May 28, 2020
Slide 1: 1Q20 Financial Results
1Q20 Financial Results 28 May 2020
Slide 2: Table of Contents
Table of Contents 1 Key Highlights 2 Profitability 3 Asset Quality 4 Liquidity 5 Capital 6 Transformation Program Update 7 Macro 8 Appendix
Slide 3: Key Highlights
Key Highlights 1
Slide 4: NBG 1Q20 Group financial highlights
NBG 1Q20 Group financial highlights Profitable with Elevated Resilient PAT (cont. ops) CoR Core PPI €409m €486m €137m Near flat qoq, resulting from Absorbing the total anticipated³ Of which €416m of total anticipated³ lower core income offset by Covid19 related charge-offs already in lower costs Cov
Slide 5: NBG's response to Covid19
Capitalizing on the established transformational capacity of NBG to weather the storm • Ensuring the health and safety of our employees, customers and stakeholders has been our top priority • Rapid and efficient shift to new Work-from-Home operating model: 70% of staff NBG’s response working remotel
Slide 6: Digital activity soared, supported by the acceleration of our utilization efforts
Digital activity soared, supported by the acceleration of our utilization efforts Highlights of digital strategy Digital subscribers (M) Δ Apr-20 INFORM vs. Mar-19 2.62 • Digital & direct marketing 2.52 Registered +26% 2.38 subscribers • Campaigns & digital events 2.16 2.26 2.08 1.74 App +76% 1.57 d
Slide 7: PPI of €912m absorbs total anticipated Covid19 related credit risk charge offs
PPI of €912m absorbs total anticipated Covid19 related credit risk charge offs, resulting into a 1Q20 PAT of €304m P&L Highlights P&L | Group €m 1Q20 1Q19 YoY 4Q19 QoQ 1Q20 Group attributable PAT reached €304m relative to €41m a year ago, NII 277 290 -4% 288 -4% reflecting large one off items and st
Slide 8: Coverage +280bps to 56%; CET1 ratio at 15.5%
Coverage +280bps to 56%; CET1 ratio at 15.5%1 absorbing total anticipated Covid19 charge offs of 143bps non annualized Asset Quality, Liquidity & Capital Highlights Key P&L Ratios | Group 1Q20 4Q19 3Q19 1Q19 1Q.20 Bank NPE stock edges lower to €10.4b NIM (bps) 234 259 270 264 • NPE reduction continu
Slide 9: Profitability
NATIONAL BANK OF GREECE Profitability
Slide 10: 1Q20 Group operating profit at €426m, net of Covid19 charge-offs
1Q20 Group operating profit at €426m, net of total anticipated Covid19 related charge-offs Group operating result bridge 1Q20 (€ m) Group operating margin decomposition2 1Q20 (bps) Reported Core / Underlying Of which Covid19 provisions of Group operating €416m 16 426 67⁴ result (€m) +793 1 1256 Core
Slide 11: 1Q20 domestic NII (-4.4% yoy)
1Q20 domestic NII (-4.4% yoy), mostly due to lower NII from NPEs, but also absorbing lower NII from securities and Tier2 Domestic NIM & CoR (bps) Domestic NII breakdown (€ m) Reflecting GGB sales and 1Q19 2Q19 3Q19 4Q19 1Q20 Includes a €4m swap, the T2 cost and qoq reduction increase in cash reserve
Slide 12: Repricing of time deposits continues; deposit momentum maintained
Repricing of time deposits continues, benefitting 1Q20 NII by +€4m qoq; deposit momentum maintained Greek deposit yields (bps) Greek deposits evolution (€ b) 83 79 80 79 70% 72% Core deposits/total New production 64 at 31bps +6.7% yoy Impacted by 52 one key 64 account Term 44.0 41.6 41.4 42.2 +€2.8b
Slide 13: Corporate performing loans up by 9% yoy
Corporate performing loans up by 9% yoy or €1.1b yoy; 1Q20 disbursements at €1.1b Greek forborne, PE & total lending yields Greek loan evolution (€ b) Performing 3.7% 28.7 28.6 27.8 27.9 27.6 Net loans 3.7% 3.7% -13bps 3.6% qoq 3.4% Performing loans4 3.6% 3.5% Total1 3.6% 3.5% 3.3% 22.6 22.7 22.8 22
Slide 14: Retail fees (+25% yoy) drive domestic fees up
Retail fees (+25% yoy), offset pressure in the corporate business, driving domestic fees up by 14% yoy Domestic fees (€ m) Domestic retail fees decomposition (€ m) 42bps 47bps 42bps Fees/Assets1 YoY 68 YoY 36 +25.0% 33 Intermediation & 63 +13.3% other 29 12 +28.0% 11 Bancassurance 11 10 +3.1% 56 8 +
Slide 15: Cost reduction initiatives lead domestic personnel costs down by 8% yoy
Cost reduction initiatives lead domestic personnel costs down by 8% yoy – with the FY impact at c.€40m Group OpEx by category (€ m) Domestic Branch evolution (#) Domestic Group 528 527 1Q20 1Q19 yoy 1Q20 1Q19 yoy 510 -72 branches Last leg of 2019 VES of c300FTEs 486 not fully Personnel 117 127 -8.2%
Slide 16: Asset Quality
NATIONAL BANK OF GREECE Asset Quality
Slide 17: NPE reduction is maintained in 1Q20
NPE reduction is maintained in 1Q20, moderated by Covid19 uncertainty in March but excluding moratorium impact Domestic NPE stock per category – 1Q20 (€ b) NPE balance change (€ m, Bank) Will be offset 6.2 by moratoria FNPE & other introduced 1.7 NPE inflows 406 395 332 254 289 in early 2Q impaired
Slide 18: 1Q20 NPE reduction benefits from mortgage restructurings
1Q20 NPE reduction (excl. moratoria), benefit from mortgage restructurings involving substantial debt forgiveness Mortgages (€ m) Consumer (€ m) NPE change1 (€ m) Does not include impact of -8 -31 -4 -33 moratoria introduced in early 2Q -40 -149 -179 -173 NPL sale (€0.7b) c1/2 due to debt -304 -214
Slide 19: NPE coverage increases further by 280bps qoq to 56%
NPE coverage increases further by 280bps qoq to 56% providing strategic flexibility Domestic 90dpd ratios and coverage | 1Q20 Domestic 90dpd – NPE bridge (€ b) | 1Q20 Collateral 71% 23% 66% 64% 66% coverage1 42% 0.3 10.6 2.2 0.7 90dpd 33% 7.5 24% 102% ratio 22.4% 21.8% 115% 10% 90dpd 58% 79.2% 79.3%
Slide 20: Loan portfolio quality improves as S3 loans are substituted by S1
The quality of the Bank’s loan portfolio improves as S3 loans are substituted by S1; S3 coverage +190bps qoq Group loan staging and evolution (€ b) Group Stage 2 ratios and coverage (%) Group Stage 3 ratios and coverage (%) Δ qoq Stage 3 16.1 13.6 38.9% 10.9 10.7 -0.2 36.4% o/w: €2.6b FPEs Ratio 31.
Slide 21: Less than 20% of corporate clientele highly affected by Covid19
Less than 20% of NBG’s corporate clientele is estimated to be highly affected by Covid19 Portfolio¹ concentration Corporate clientele affected by Covid192 3 Manufacturing 16.3% • accommodation (54%) Shipping 12.9% • services related to air transportation (18%) Highly affected • media (TV, press) (6%
Slide 22: Liquidity
NATIONAL BANK OF GREECE Liquidity
Slide 23: Domestic deposit momentum maintained in 1Q20
Domestic deposit momentum is maintained in 1Q20 benefitting by State deposit inflows Deposit evolution by geography (€ b) NBG domestic deposit flows (€ b) YoY 3.4 Group 42.5 42.9 42.8 43.6 45.4 +6.7% 1.7 1.1 1.5 0.2 0.5 -2.2 -3.6 SEE & 1.4 1.4 -4.8 1.3 1.3 1.4 +6.3% Other 44.0 4Q14 1Q15 2Q15 2H15 FY
Slide 24: ECB exposure to TLTRO/LTRO facilities increases
ECB exposure to TLTRO/LTRO facilities increases, fueling credit extension Eurosystem funding (€ b) Repo funding (net, € b) 27.6 24.0 ELA¹ 17.6 11.5 3.6 3.4 12.3 5.6 1.9 1.6 Funding cost at -73bps 12.5 ECB 10.0 0.9 0.9 6.7 5.0 0.3 3.4 0.2 2.8 2.2 2.2 2Q15 4Q15 4Q16 4Q17 4Q18 4Q19 1Q20 May20 4Q17 4Q18
Slide 25: Capital
NATIONAL BANK OF GREECE Capital
Slide 26: CET1 and Total Capital ratios at 15.5%/16.4%
CET1 and Total Capital ratios at 15.5%/16.4%, absorbing Covid19 total anticipated provisions² 1Q20 CET1 ratio movement Total Capital ratio at 16.4% 16.0% +0.15% 15.5% +0.18% 1 15.6% -0.41% -0.12% -0.14% CET1: CET1: €5.7b CET1: €6.0b €5.7b CET1 FL: 12.8% CET1 FL: OCR: 12.8% CET1 FL: 11.5% 12.6% CET1
Slide 27: Transformation Program Update
Transformation Program Update 6
Slide 28: Transformation Program acts as a robust mechanism to respond to the crisis
Transformation Program acts an established, robust mechanism to respond to the crisis PURPOSE, VALUES & CULTURE (PVC) Strong governance and cadence, with full Covid19 sponsorship of management team and Board HEALTHY BEST BANK EFFICIENCY RESPONSE BALANCE SHEET FOR OUR CLIENTS & AGILITY (HBS) (BBC)
Slide 29: Organisation mobilized swiftly across all workstreams
Organisation mobilized swiftly and effectively across all workstreams Highlights of efforts in last 3 months HEALTHY BALANCE • Finalization of Icon, Cyprus and Romania transactions; preparation of Frontier securitization SHEET (HBS) • Implementation of payment moratoria across all segments, in line
Slide 30: Macro
NATIONAL BANK OF GREECE Macro
Slide 31: Increasing fiscal and liquidity support to assist post-lockdown recovery
Increasing fiscal and liquidity support to assist post-lockdown recovery • Pre-emptive lockdown measure enforcement, allows Greece to lift restrictions early, Greece to capitalize ranking among the best EU performers in controlling the pandemic spread on the successful • Mobility indicators show ear
Slide 32: COVID-19 interrupted the economic recovery
COVID-19 interrupted the economic recovery, hitting key areas of Greece’s services-based economy Economic sentiment & Greek GDP growth ESI, indicators of confidence, PMI & GDP growth forecast 6 y-o-y index 133 120 forecasts 12 123 3 80 2.3% 8 113 40 4 0 0 0 103 -40 -4 -3 93 -80 -8 index -120 -9.7% -
Slide 33: Successful crisis management permits timely lifting of restrictions
A successful crisis management permits a timely lifting of restrictions, with some sectors showing resilience to the downturn Covid-19 deaths in European countries Covid-19 Community Mobility: Retail & recreation 10000 Belgium 20 20 Deaths: 9,186 | Population: 11.5 mn 8000 Base 0 Base 0 Netherlands
Slide 34: Fiscal flexibility and supportive monetary policy provide a safety net
Fiscal flexibility, favorable debt characteristics and supportive monetary policy provide a safety net, with more than €6b of EU funding & loan guarantees expected in H2:2020 Fiscal stance & GDP growth State budget revenue, expenditure & primary balance 6 -6 12 y-o-y 1,2 y-o-y 4 -4 8 0,8 2 -2 4 0,4
Slide 35: Appendix
NATIONAL BANK OF GREECE Appendix
Slide 36: Group Balance Sheet & P&L
Group Balance Sheet & P&L Balance Sheet | Group P&L | Group €m 1Q20 4Q19 3Q19 2Q19 1Q19 €m 1Q20 4Q19 3Q19 2Q19 1Q19 Cash & Reserves 5,634 3,502 2,958 1,839 2,570 NII 277 288 299 309 290 Interbank placements 3,754 2,974 3,295 3,054 3 072 Net fees & commissions 66 71 64 61 59 Securities 11,537 9,352 8
Slide 37: Regional P&L: Greece & Other International
Regional P&L: Greece & Other International Greece International €m 1Q20 4Q19 3Q19 2Q19 1Q19 €m 1Q20 4Q19 3Q19 2Q19 1Q19 NII 262 271 284 293 274 NII 15 17 15 16 16 Net fees & commissions 63 68 60 58 56 Net fees & commissions 3 3 4 4 3 Core Income 325 339 345 351 330 Core Income 18 20 19 19 19 Trading
Slide 38: ESMA Alternative Performance Measures (APMs)
ESMA Alternative Performance Measures (APMs), definition of financial data and ratios used The 1Q20 Financial Results Press Release contains financial information and measures as derived from the Group and the Bank financial statements for the period ended 31 March 2020 and for the year ended 31 Dec
Slide 39: Definition of financial data, ratios used and alternative performance measures
Definition of financial data, ratios used and alternative performance measures Name Abbreviation Definition Balance Sheet B/S Statement of Financial Position Binding Offers / Non Binding Offers BOs / NBOs Common Equity Tier 1 Ratio CET1 Ratio CET1 capital as defined by Regulation No 575/2013, with t
Slide 40: Definition of financial data, ratios used and alternative performance measures
Definition of financial data, ratios used and alternative performance measures Name Abbreviation Definition Net interest income over average interest earning assets. Net Interest Margin equals net interest income divided by the average of interest earning assets (the Net Interest Margin NIM average
Slide 41: Important Notice – Disclaimer
Important Notice – Disclaimer The information, statements and opinions set out in the 1Q20 Results Press Release and accompanying discussion (the “Press Release”) have been provided by National Bank of Greece S.A. (the “Bank”) (together with its consolidated subsidiaries (the “Group”)). They serve i
Slide 42: Important Notice – Forward Looking Information
Important Notice – Forward Looking Information Forward Looking Statements reflect knowledge and information available at the date of the Press Release and are subject to inherent uncertainties and qualifications and are based on numerous assumptions, in each case whether or not identified in the Pre
Slide 43: Contact details
Contact details Pavlos Mylonas Christos Christodoulou Grigoris Papagrigoris CEO CFO Head of IR +30210 334 1521 +30210 334 3051 +30210 334 2310 pmylonas@nbg.gr cchristodoulou@nbg.gr papagrigoris.gr@nbg.gr Panagiotis Alevras Maria Kanellopoulou Maria Constantinou Investor Relations Officer Investor Re
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