National Bank Of Greece S.a. · ATHEX:ETE
National Bank Of Greece — Q3 2023 Earnings Presentation
48 slides from National Bank Of Greece's earnings presentation, Nov 7, 2023
Slide 1: 3Q23 Financial Results
3Q23 Financial Results 7 November 2023
Slide 2: Table of Contents
Table of Contents 1 Key Highlights 2 Macro 3 Financial Results 4 ESG Update 5 Transformation Program Update 6 Appendix
Slide 3: 1 Key Highlights
NATIONAL BANK OF GREECE 1 | Key Highlights
Slide 4: 9M23 Core PAT growth continues reaching €0.9b
9M23 Core PAT growth continues reaching €0.9b 9M23 Core PAT¹ 9M23 Core RoTE 9M23 Core income €855m 3.0x yoy 17.8% +10.9pps yoy €1,913m +59% yoy 3Q23 Core PAT¹ C:CI €346m +20% qoq 31% -17ppts yoy Performing loans Net NPEs €0.1b CET1 FL 2 2 +€1.5b yoy NPEs at €1.1b (€1.7b in 2Q23) 17.9% at €28.0b, +5%
Slide 5: 9M23 profitability outperforming comfortably our FY23 guidance
9M23 profitability outperforming comfortably our FY23 guidance Cost to Core Income | % Core PAT | € m 346 52% FY23 guidance <35% 288 49% 45% 220 43% 31% 190 9M23 actual 142 34% 73 31% 30% 69 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 EPS¹ | € Core RoTE | % 1.51 20.8% 18.0%
Slide 6: Core income momentum drives 9M23 profitability 3x higher yoy
Core income momentum drives 9M23 profitability 3x higher yoy Profitability “jaws” | € m Core profitability | € m 683 646 584 2.1x 1,311 yoy 510 Core 623 436 2.0x PPI 481 yoy 398 448 Core 373 383 Income Loan & other -175 -19% 288 -216 impairments 239 204 Core PPI 181 3.0x 222 855 yoy OpEx 192 194 197
Slide 7: Deposits keep increasing (+€1.1b ytd); Deposit mix remains supportive
Deposits keep increasing (+€1.1b ytd); Deposit mix remains supportive NBG Deposit¹ flows ytd (€ b) NBG Deposit¹ mix (%) +€1.1b Corporate liquidity drawdowns 4% 4% 3% 3% 3% 12% 12% 16% 18% 19% 2 other Time Core 84% 84% 81% 80% -€0.4b 79% +€0.8b +€0.6b Unchanged in October compared 1Q23 2Q23 3Q23 to S
Slide 8: NPE ratio down to 3.6% aided by the latest transaction
NPE ratio down to 3.6% aided by the latest transaction NPE flow¹ (€ b) NPE decomposition¹ (€ b) FNPEs >30dpd & other impaired Reflecting the new NPE FNPE <30dpd cleanup transaction 2 1.8 90+ dpd 1.6 -0.6 1.6 c45% of NPE stock <30dpd 0.1 1.1 0.1 0.2 1.1 0.6 0.1 0.5 1.0 0.5 1.1 0.9 0.5 FY22 Inorganic
Slide 9: Investment grade achievement acknowledges the country's return to normalcy
Investment grade achievement acknowledges the country’s return to normalcy and sustainable growth Rating evolution | Hellenic Republic Credit ratings per agency | NBG vs sovereign Rating Investment Grade scale Investment Grade BBB- Rating BB+ outlook BB Ba1 BBB- BB+ BBB (low) BB- stable stable stabl
Slide 10: 2 Macro
NATIONAL BANK OF GREECE 2\ Macro
Slide 11: Economic recovery on solid footing despite international headwinds and the recent floods
Economic recovery on solid footing despite international headwinds and the recent floods Greek GDP recorded one of the strongest increases Greece’s GDP growth accelerated to 2.7% yoy (+1.3% qoq s.a.) in 2Q23 among euro area economies in 2Q23 from 2.0% yoy in 1Q, outperforming the euro area (EA) by a
Slide 12: Strong labor market conditions, solid profitability and sizeable liquidity buffers
Strong labor market conditions, solid profitability and sizeable liquidity buffers set the stage for sustained investment-led growth Labor income and corporate profits continue to exhibit • Labor income grew by 6.9% yoy in 1H23, supported by increasing real 25 y-o-y solid growth for a 3rd consecutiv
Slide 13: On a resilient growth path with broad-based support from all major activity components
On a resilient growth path with broad-based support from all major activity components Greece’s economic recovery outpaces the euro area Shifting towards a more export-oriented model 110 110 €bn The market share of total exports in the EU27 %GDP index, 4Q19=100, 120 50 constant prices has increased
Slide 14: An investment-led growth model buoyed by strong banking system liquidity
An investment-led growth model buoyed by strong banking system liquidity & rising collateral values House prices up by 54% in 2Q23 vs their 3Q17 low, but Over €45b of residential investment will be required still competitively priced compared with the EA average through 2030 to rebalance housing dem
Slide 15: The remarkable fiscal rebalancing underpinned the return to investment grade
The remarkable fiscal rebalancing underpinned the return to investment grade. The ongoing risk re-rating and RRF-induced investments will lead to a sustainable growth paradigm Sustained fiscal overperformance bolstered by efficiency Rapid decline in public debt as % of GDP in 2020-23 on the gains an
Slide 16: 3 Financial Results
NATIONAL BANK OF GREECE 3 | Financial Results
Slide 17: 9M23 Group core PAT of €0.9b, driven by sustained NII momentum
9M23 Group core PAT of €0.9b, driven by sustained NII momentum (+73% yoy) P&L Highlights P&L | Group 3Q23 Group core PAT at €346m (+20% qoq), reflects core income €m 9M23 9M22 YoY 3Q23 QoQ growth (+6% qoq) leveraging tight cost control, thus driving 9M23 NII 1 640 948 +73% 588 +6% Group core PAT to
Slide 18: Buoyant performing loan expansion, sharply rising capital buffers and NPE ratio down
Buoyant performing loan expansion (+€0.6b qoq), sharply rising capital buffers and NPE ratio down to 3.6% Balance sheet Highlights Key Balance Sheet items & ratios | Group Disbursements pick up to nearly €2b in 3Q23 Key Balance sheet items 9M23 6M23 3M23 FY22 9M22 • Disbursements¹ reach €1.9b in 3Q2
Slide 19: Strong profitability sustains capital generation at c60bps in 3Q23
Strong profitability sustains capital generation at c60bps in 3Q23; CET1 up by c220bps ytd 3Q23 FL capital movement1 20.3% 18.3% +c0.8% +c0.0% CAD FL 16.8% -c0.2% Includes DTC amortization 17.3% 17.9% CET1 FL 15.7% 4Q22 2Q23 3Q23 Profitability Credit RWAs Other (incl. FVTOCI) 3Q23 RWAs €36.2b €36.7b
Slide 20: "Fortress balance sheet" is a unique comparative advantage
“Fortress balance sheet” is a unique comparative advantage Group Assets1 (€ b) Group Liabilities1 (€ b) 1.5 Interbank Excess liquidity at €7.4b, factoring Cash & reserves 6.5 in TLTRO repayment and net interbank position Interbank 2.3 15.7 Securities portfolio Securities² • HTC €12.1b (hedged) • HTC
Slide 21: 9M23 Group COP up by nearly 3x, driven by topline momentum and cost containment
9M23 Group COP up by nearly 3x, driven by sustained positive topline momentum and sustained cost containment Group core operating profit bridge 9M23 (€ m) Group operating profit decomposition 9M23 (€ b) COP margin (bps) 176 471 +295bps yoy +€15m yoy incl. impact of merchant 2.8x yoy acquiring decons
Slide 22: Strong NII momentum supported by base rate driven loan repricing
Strong NII momentum supported by base rate driven loan repricing Domestic NII (€ m), Group NIM (bps) Domestic NII breakdown (€ m) +25bps qoq NII 328 401 474 529 563 297 322 NIM¹ (Group) 260 212 173 Loans (PE) 264 336 378 178 +42bps Loans (NPE) 50 qoq 3M Euribor Securities, funding & other (avg) Depo
Slide 23: Disbursements pick up to nearly €2b and domestic PEs expand by +€0.6b qoq
Disbursements pick up to nearly €2b and domestic PEs expand by +€0.6b qoq Greek loan evolution | performing loans (€ b) Bank Loan disbursements¹ (€ b) 9M22 9M23 +9% yoy 4.0 4.4 27.6 27.6 28.0 27.4 +€1.5b 26.5 +5% yoy 2.7 +€2.0b 2.1 +12% yoy 1.9 +40% qoq 16.9 18.0 18.1 18.1 18.9 1.9 Total Corporate 2
Slide 24: Loan pass through rate remains at 70% driving PE lending spreads lower
Loan pass through rate remains at 70% driving PE lending spreads lower Greek PE lending spreads¹ (bps) Greek NPE NII%, Loan yield Total 295 275 269 260 234 Performing ² Dom. NPE NII⁴ /Dom. NII % 5.9% 4.4% 3M Euribor 50 178 264 336 378 3.5% (avg) 1.2% 761 FY20 FY21 FY22 9M23 715 680 Consumer³ 649 630
Slide 25: Domestic deposits continue strong, up by +€1.1b ytd
Domestic deposits continue strong, up by +€1.1b ytd despite corporate drawdowns in the beginning of the year Group deposits evolution (€ b) Greek deposit spreads against avg 3M euribor (bps) Group 55.7 55.2 54.8 55.7 56.3 +€1.1b ytd SEE & 1.7 1.8 1.8 1.9 1.9 Demand Other 373 331 260 176 Average 54.4
Slide 26: Net cash position of €7.4b underlines NBG's liquidity advantage
Net cash position of €7.4b underlines NBG’s liquidity advantage; MREL capital well ahead of interim target TLTRO, Cash & reserves, Net Interbank (€ b) NBG Funding Cost (bps) TLTRO NBG is a net lender in the 378 3M Euribor (avg) Cash & reserves interbank market Net Interbank 336 17.6 6.9 7.4 264 14.2
Slide 27: Domestic fees grow by +17% yoy on a like-for-like basis
Domestic fees grow by +17% yoy on a like-for-like basis, driven by retail and corporate businesses Domestic fees (€ m) Domestic retail fees decomposition (€ m) Fees/Assets 42bps 49bps YoY +17% yoy YoY +21% yoy ex merchant ex merchant 262 +7% acquiring 146 +9% acquiring 246 134 18 18 +17% 24 Deposits
Slide 28: Cost discipline continues: Personnel and G&As +c1% yoy
Cost discipline continues: Personnel and G&As +c1% yoy; digital transformation drives FTE optimization Group Cost-to-Core Income (%) Group headcount¹ evolution (# k) Cost/ core 19.8 income % 48.3 31.4 58.9 29.6 56.9 55.2 -16.9ppts yoy 7.8 6.7 at Bank level Personnel cost/ 10.8 25.8 10.1 core income
Slide 29: Near zero organic formation complemented by the new NPE transaction drive down gross NPEs
Near zero organic formation complemented by the new NPE transaction drive down gross NPEs to c€1b Domestic NPE stock per category | 3Q23 (€ b) NPE balance change (€ b, Bank) o/w: €0.2b or c40% <30dpd 1.1 o/w: €0.2b or 0.2 0.1 0.1 0.1 0.1 c85% <30dpd NPE inflows (+) 0.7 -0.1 -0.1 -0.1 -0.2 -0.1 Curin
Slide 30: Remaining NPE stock at €1.1b
Remaining NPE stock at €1.1b Domestic NPE ratios and coverage | 3Q23 Domestic forborne stock (€ b) | 3Q23 Collateral 69% 72% 71% coverage1 FNPE<30 dpd 0.5 NPE ratio 5% FPE 1.5 FNPE 31-90dpd 3.6% 3.7% 0.0 3% €2.1b FNPE >90dpd 0.1 NPE 92% coverage2 95% 93.5% 93.1% Retail Corporate Total Domestic Total
Slide 31: 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 2.0 1.8 1.8 1.2 -0.8 o/w: 14.1% €1.5b FPEs 13.8% Stage 2 €1.7b SICR €0.3b +30dpd 12.3% 4.6 4.5 4.1 3.5 -1.0 10.7% Ratio Stage 1¹ 6.2%
Slide 32: 4 ESG Update
NATIONAL BANK OF GREECE 4| ESG Update
Slide 33: 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) 1.8 • Issuance of first Sustainable Bond Framework in Greec
Slide 34: High transparency in measurement and reporting of financed emissions, in line with PCAF
High transparency in measurement and reporting of financed emissions, in line with PCAF1 NBG’s 2022 financed emissions per PCAF asset class • First Greek systemic bank to join PCAF • 94% coverage of total activities eligible under the PCAF methodology measured and disclosed • High level of transpare
Slide 35: Ambitious sector-specific targets for financed emissions
Ambitious sector-specific targets for financed emissions, underpinning our commitment to net zero NBG’s net zero targets • Joined the industry-led and UN-convened Net Zero Banking Alliance (NZBA) • Targets set already achieving 74% coverage of relevant NZBA Scope 1 & 2 emissions perimeter • Frontrun
Slide 36: 5 Transformation Program Update
5 Transformation Program Update
Slide 37: The Transformation Program acts as a competitive advantage
The Transformation Program acts as a competitive advantage, supporting sustainable change and target achievement 9M23 highlights BEST BANK FOR BEST BANK FOR SPECIALIZED ASSET EFFICIENCY & OUR CLIENTS OUR CLIENTS SOLUTIONS AGILITY (BBC Corporate) (BBC Retail) (SAS) (ENA) • Migration to new centralize
Slide 38: NBG is widely recognised for its digital transformation
NBG is widely recognised for its digital transformation, as our strategy continues to deliver impressive results ONBOARD ENGAGE CROSS-SELL ONBOA RD Mobile app downloads (m) Digital active users1 (m) Digital cumulative sales2 (m) 4.1 Active 3.6 users 12M 2.7 2.8 2.9 2.5 2.1 2.3 1.1 2.3 2.3 2.0 0.8 Ac
Slide 39: 6 Appendix
NATIONAL BANK OF GREECE 6| Appendix
Slide 40: Guidance FY25: targeting a sustainable core RoTE of >13%
Guidance FY25: targeting a sustainable core RoTE of >13%; to be updated upon release of the FY23 results Financial performance metrics Actual Guidance Group 9M23 FY23 FY25 PE loan growth¹ +5% +7% CAGR NPE ratio² 3.6% c5% c3% S3 coverage 55.3% >50% >50% NIM (bps) 292 >300 c250 ECB DFR eop (bps) 400 3
Slide 41: Group Balance Sheet & P&L
Group Balance Sheet & P&L Balance Sheet | Group P&L | Group €m 3Q23 2Q23 1Q23 4Q22 3Q22 €m 3Q23 2Q23 1Q23 4Q22 3Q22 Cash & Reserves 8,400 7,551 9,950 14,226 17,572 NII 588 554 497 421 348 Interbank placements 2,330 2,735 2,731 2,900 3,143 Net fee & commission income 95 92 87 89 88 Securities 15,712
Slide 42: Geographical segment P&L: Greece & International
Geographical segment P&L: Greece & International Greece International €m 3Q23 2Q23 1Q23 4Q22 3Q22 €m 3Q23 2Q23 1Q23 4Q22 3Q22 NII 563 529 474 401 328 NII 25 25 23 21 20 Net fee & commission income 92 87 83 85 85 Net fee & commission income 4 5 3 4 3 Core Income 654 616 557 485 413 Core Income 29 30
Slide 43: ESMA Alternative Performance Measures (APMs), definition of financial data and ratios used
ESMA Alternative Performance Measures (APMs), definition of financial data and ratios used The 3Q23 Financial Results Presentation contains financial information and measures as derived from the Group financial statements for the period ended 30 September 2023 and for the year ended 31 December 2022
Slide 44: 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 45: Definition of financial data, ratios used and alternative performance measures
Definition of financial data, ratios used and alternative performance measures Minorities -- Non-controlling interest MREL -- The minimum requirement for own funds and eligible liabilities under the BRRD. Net Interbank -- Due from banks less due to banks, excluding the TLTRO facility Net Interest Ma
Slide 46: Important Notice – Disclaimer
Important Notice – Disclaimer The information, statements and opinions set out in the 3Q23 Results Presentation and accompanying discussion (the “Presentation”) have been provided by National Bank of Greece S.A. (the “Bank”) together with its consolidated subsidiaries (the “Group”). They serve infor
Slide 47: 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 48: Contact details
Contact details Christos Christodoulou +30 210 334 3051 cchristodoulou@nbg.gr Group CFO Greg Papagrigoris +30 210 334 2310 papagrigoris.gr@nbg.gr Group Head of IR Maria Kanellopoulou +30 210 334 1537 mkanellopoulou@nbg.gr Panagiotis Alevras +30 210 772 7292 Alevras.Pan@nbg.gr George Panagopoulos, CF
National Bank of Greece — Q3 2023 Earnings Presentation on 6ix