National Bank Of Greece S.a. · ATHEX:ETE
National Bank Of Greece — FY2022 Earnings Presentation
50 slides from National Bank Of Greece's earnings presentation, Mar 14, 2023
Slide 1: FY22 Financial Results
FY22 Financial Results 14 March 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: Key Highlights
NATIONAL BANK OF GREECE 1 | Key Highlights
Slide 4: Group highlights: performance far exceeds 2022 guidance
Group highlights: performance far exceeds 2022 guidance FY22 PATattrib. FY22 COP Core income €1,120m €695m €1,717m up +15% yoy up +29% yoy up +57% yoy vs guidance of c€0.5b C:CI 46.9% -540bps yoy fulfilling already the previous 2024 target Net NPEs €0.2b CET1 FL 1 Performing loans 1 +€2.5b yoy, at €
Slide 5: Overperformance in all key P&L lines..
Overperformance in all key P&L lines.. Key P&L performance indicators Core profitability COP higher by FY21A FY22 FY22A Outperformance >€200m vs guidance Guidance¹ 695 NII +3% -9% +13% >20ppts yoy chn yoy +57% 490 Fees COP 443 chn yoy +10% +c13% +21% +8ppts €m C:CI 52% c52% 47% +5ppts 538 +26% Core
Slide 6: ..reflecting impressive and continuing core income growth
..reflecting impressive and continuing core income growth Profitability “jaws” | € m – 4Q22 Profitability “jaws” | € m – FY22 Core profitability | € m C:CI 48.8% 45.2% 43.5% 57.9% 52.3% 46.9% +27% 510 912 yoy 1,717 Core 715 PPI 436 1,498 1,440 398 Core Income +27% -21% +21% 912 -217 288 qoq yoy CoR
Slide 7: Asset quality and capital improves from best in class levels
Asset quality and capital improves from best in class levels Domestic NPE exposure and coverage Fully loaded capital Coverage% 77.5% >80% 88.4% S3 coverage% 52.9% n/a 57.0% yoy (bps) NPE% 6.9% c6% 5.1% 16.2 16.8 +c120 CAD FL% 15.5 Lowest exposure NPEs €b 2.1 in Greece 1.8 Highest capital 1.6 levels
Slide 8: Guidance 2023-25: targeting a core RoTE of >12% and EPS accretion of >50%
Guidance 2023-25: targeting a core RoTE of >12% and EPS accretion of >50% Core profitability & returns NPE⁵ exposure and coverage S3 coverage 57% >50% >50% FY22 FY23 FY25 NPE ratio 5.1% c5% PE loan +10% +7% CAGR growth¹ c3% NIM bps 213 +40 flat C:CI 47% c42% c40% FY22 FY23B FY25BP Key macroeconomic
Slide 9: Macro
NATIONAL BANK OF GREECE 2\ Macro
Slide 10: Economic growth remained on a robust upward trend in FY22 overcoming inflation-induced risks
Economic growth remained on a robust upward trend in FY22 overcoming inflation-induced risks Resilient activity until 4Q22 with FY22 GDP growth at 6.1% (s.a. Strong consumption and investment offset external data) underpinned by: pressures in 2022 10 contribution y-o-y 10 • Strong labor market, with
Slide 11: Sustainable growth catalysts for 2023 against weakened external conditions
Sustainable growth catalysts for 2023 against weakened external conditions • Inflation pressures are easing, with Greece’s HICP growth slowing to Inflation decelerates as energy price pressures have eased 6.5% y-o-y in February 2023, from 8.6% in 4Q22 and 11.5% in 3Q22, 15 y-o-y 15 due to falling en
Slide 12: Strong labor market and government measures cushioned the inflation shock
Strong labor market, high business adaptability, and additional government measures cushioned the inflation shock in 2022 and will continue to support growth in 2023 The inflation drag on disposable income has been offset by Unemployment at a 13-year low of 10.8% in January 2023, rising labor and no
Slide 13: Credible growth drivers, strong liquidity and encouraging high-frequency indicators
Credible growth drivers, strong liquidity and encouraging signs from high-frequency indicators through to early-2023 Buoyant business turnover growth and accelerating bank lending towards an underleveraged corporate sector Further upside potential for tourism in 2023 y-o-y y-o-y 50 35 million 35 12
Slide 14: Greece should maintain a positive growth differential vis-à-vis the euro area
Greece should maintain a positive growth differential vis-à-vis the euro area, on the back of strong investment, slowing inflation and a cyclically-driven fiscal rebalancing, that pave the way for a rating upgrade CPI inflation has decelerated but food and core inflation Outpacing euro area growth o
Slide 15: Financial Results
NATIONAL BANK OF GREECE 3 | Financial Results
Slide 16: Accelerating core profitability reflects core income expansion and contained costs
Accelerating core profitability reflects impressive core income expansion and contained operating costs P&L Highlights P&L | Group €m FY22 FY21 YoY 4Q22 QoQ FY22 Group attributable PAT reaches €1.1b, driven by strong core NII 1 369 1 212 +13% 421 +21% operating profitability, up by +57% yoy to €0.7b
Slide 17: PEs up by €2.5b in 2022, NPE ratio drops to 5.1%, CET1 FL up
PEs up by €2.5b in 2022, NPE1 ratio drops to 5.1%, while CET1 FL ratio increases by >80bps yoy Balance sheet Highlights Key P&L Ratios | Group Domestic PE loan book expands by an impressive +€2.5b yoy 4Q22 3Q22 2Q22 1Q22 4Q21 • Factoring in a very strong 4Q22 with disbursements amounting to €2.7b, d
Slide 18: Strong profitability drives recurring organic capital generation
Strong profitability drives recurring organic capital generation FY22 FL capital movement1 Loan expansion² of €2.5b yoy in FY22, of which €1.2 in 4Q22 +c1.9% 16.8% CAD FL 15.5% -c1.0% -c0.2% CET1 Ph-in: 16.9% CET1 Ph-in: 16.6% 15.7% CET1 FL 14.9% CAD Ph-in: 17.7% CAD Ph-in: 17.5% FY21 FY22 PAT RWA n
Slide 19: FY22 Group COP up by nearly 60% yoy
FY22 Group COP up by nearly 60% yoy reflects accelerating core income while costs remain contained Group core operating profit bridge FY22 (€ m) Group operating profit decomposition FY22 (€ b) COP (€m) 443 695 +57% yoy COP margin (bps) 160 223 +63bps yoy +57% yoy OpEx +21% yoy +3% yoy 291bps in 4Q22
Slide 20: A high quality balance sheet, well positioned in the current choppy environment
A high quality balance sheet, well positioned in the current choppy financial environment Group Assets1 (€b) Group Liabilities1 (€b) Interbank 1.7 Cash & reserves 6.1 Excess liquidity at +€6.7b, factors in full TLTRO repayment Interbank 2.9 Securities portfolio Securities 13.6 ✓ Total €13.3b (excl.
Slide 21: FY22 PE NII grows by 23% yoy driven by higher volumes and rates
FY22 PE NII grows by 23% yoy driven by higher volumes (+10% yoy) and rates (+c30 bps yoy in 2022) Domestic PE loan portfolio evolution | € b Domestic PE NII | € m Disbursements¹ PE yield % 3.1% 3.4% +c30bps +4.9 +6.7 PE loan growth yoy +6% +10% yoy 2.5 PE growth yoy 1.4 FY21 FY22 Domestic PE yield |
Slide 22: PE NII recovery continues stronger in 4Q22 due to base rate loan repricing
PE NII recovery continues stronger in 4Q22 (+22% qoq), due to base rate loan repricing Domestic NII (€ m), Group NIM & CoR (bps) Domestic NII breakdown (€ m) 1 145 1 293 NIM (Group) 259 NII 270 294 328 401 206 213 182 194 50 178 3M Euribor +13% (avg) -57 -53 -35 +22% +11% +9% 962 +23% 303 785 Loans
Slide 23: Domestic PEs grow by +€2.5b yoy to €28b, driven by corporate disbursements
Domestic PEs grow by an impressive +€2.5b yoy to €28b, driven by corporate disbursements Greek loan evolution | performing loans (€ b) Bank Loan disbursements¹ (€ b) 38% yoy (+29% retail, 28.9 28.8 29.8 29.7 30.8 Net loans² +40% corporate) 4.9 6.7 27.7 26.5 26.5 +€2.5b 25.5 +10% yoy 2.7 25.2 +€2.9b
Slide 24: PE lending yields gradually reprice, reflecting rising ECB rates
PE lending yields gradually reprice, reflecting rising ECB rates Greek PE lending yields (bps) Greek NPE NII%, forborne & PE yields Total 308 306 307 326 407 Performing ¹ Dom. NPE NII³ /Dom. NII % 5.9% 3M euribor -57 -53 -35 50 178 4.4% 3.5% 850 FY20 FY21 FY22 798 771 772 772 Consumer² 4.3% 646 595
Slide 25: Time deposit yields gradually increase reflecting liquidity abundance
Time deposit yields gradually increase reflecting liquidity abundance Greek deposit yields (bps) Greek deposit evolution (€ b) 86% 88% Core deposits/total +€1.8b 53.9 53.4 +3.5% yoy 52.6 51.5 51.3 6.6 6.6 6.9 Time 7.3 7.1 Mar23 new -€0.7b production at -9.7% yoy 29 51 c130bps. c45% 8 7 11 pass throu
Slide 26: Domestic fees grow by +23% yoy, driven by strength across businesses
Domestic fees grow by +23% yoy, driven by strength across retail, corporate and non core banking businesses Domestic fees (€ m) Domestic retail fees decomposition (€ m) Fees/Assets 35bps 43bps YoY YoY 330 +23% 179 +25% 34 +14% 19 +30% 269 Deposits 143 30 +22% 15 47 +21% 117 Payments 39 Reflecting 96
Slide 27: C:CI drops to 43.5% in 4Q22 as costs remain contained
C:CI drops to 43.5% in 4Q22 as costs remain contained (+2.8% yoy) despite inflation and an ongoing IT CapEx plan Group Cost to Core Income (%) Group headcount² evolution (# k) Cost/ core 19.8 Successful income % 52.3 46.9 58.9 43.5 56.9 55.2 completion of VES for c460 FTEs -540bps yoy -170bps qoq in
Slide 28: FY22 organic flows at -€0.3b, with no signs of pick up in early arrears
FY22 organic flows at -€0.3b, with no signs of pick up in early arrears Domestic NPE stock per category | 4Q22 (€ b) NPE balance change (€ m, Bank) o/w: €0.3b or FNPE & other c30% <30dpd impaired <90dpd 1.2 90+dpd NPE inflows (+) 108 479 0.9 91 132 97 343 o/w: €0.2b or 0.5 >50% <30dpd 0.4 Curings -9
Slide 29: Circa 1/3rd of gross NPEs are FNPEs <30dpd with a high chance to cure
Circa 1/3rd of our gross NPEs are comprised of FNPEs <30dpd with a high chance to cure Domestic 90dpd ratios and coverage | 4Q22 Domestic 90dpd – NPE bridge (€ b) | 4Q22 Collateral 87% 5% 83% 73% 68% coverage1 11% 8% 90dpd 133% ratio 1.6 148% +0.5 +0.1 +0.03 2% 2.9% 3.1% 0.9 2% 90dpd coverage 176% 1
Slide 30: Loan exposure mix has changed favorably as S1 growth offsets S3 reduction
The mix of our loan exposure has changed favorably as continuous S1 loan growth far offsets S3 reduction Group gross loan stage evolution (€ b) Group S2 ratio and coverage (%) Group S3 ratio and coverage (%) Δ yoy Stage 3 2.2 2.1 2.0 1.8 -0.4 14.9% o/w: 14.4% 14.1% Ratio €2.1b FPEs 13.8% Stage 2 €2.
Slide 31: Favorable liquidity position is a strong competitive advantage
NBG’s favorable liquidity position is a strong competitive advantage. €6b TLTRO balances repaid since November TLTRO, Cash & reserves (€ b) NBG Funding Cost (bps) 17.6 TLTRO at €6b 15.8 as of March23 178 15.3 3M Euribor 14.5 14.2 (avg) 11.6 11.6 11.6 11.6 50 30 8.1 -2 -2 1 CoF (Blended) 4 -35 -57 -5
Slide 32: Deposit flows remain supportive with no signs of a change in mix
Deposit flows remain supportive with no signs of a change in mix Deposit evolution by geography (€ b) NBG domestic deposit flows (€ b) YoY Group 53.5 53.1 54.3 55.7 55.2 +3.2% 4.7 4.6 3.4 1.5 1.8 1.1 0.2 0.5 SEE & 1.8 1.7 1.7 1.8 -5.4% 1.9 Other 53.9 53.4 +3.5% 51.3 52.6 51.5 -2.2 -3.6 -€10.6b +€17.
Slide 33: ESG Update
NATIONAL BANK OF GREECE 4| ESG Update
Slide 34: Pushing forward with our climate & environment strategy within our ESG agenda
We are pushing forward with our climate & environment (C&E) strategy, within our broader ESG agenda C&E strategic themes and recent efforts Examples of impact achieved 1 Lead the market in sustainable energy financing Corporate RES PEs (2022) Green bond indicators • Utilisation of green bond at 100%
Slide 35: We baselined our GHG emissions and gained insights on our impact
We baselined our GHG emissions and gained valuable insights on our direct and indirect impact on the environment Non-financed emissions (tCO2e) Financed emissions – selected intensity metrics 2020 2021 lower emissions higher emissions 245 = same level emissions -30% D35 – Electricity generation 134
Slide 36: Strengthening our ESG governance framework, with focus on C&E matters
We are strengthening our ESG governance framework, with focus on management of C&E matters Governance for C&E matters 1 Board & Board Committees • Incorporation and oversight of ESG considerations (incl. C&E) in the Bank’s risk appetite, business strategy, business model and processes (incl. remuner
Slide 37: Strong participation and recognition of our ESG activity
Strong participation and recognition of our ESG activity ESG ratings & indices Year of inclusion/ ESG ratings & indices 2020 2021 2022 participation ESG rating BBB BBB BBB 9th Environment score 2 2 1 5th Social score 2 2 2 Governance score 2 2 2 Carbon disclosure score C C C 16th ESG index ✓ ✓ ✓ 17t
Slide 38: Transformation Program Update
5 Transformation Program Update
Slide 39: Transformation Program acts as a competitive advantage
Transformation Program acts as a competitive advantage, supporting sustainable change and target achievement Transformation structure for 2023 Key highlights • Increased focus on commercial effectiveness (Corporate, Retail, Special Assets Solution) BEST BANK FOR BEST BANK FOR SPECIALIZED ASSET EFFIC
Slide 40: Transformation supports move towards a new commercial & operating model
Transformation supports our move towards a new commercial & operating model Selected metrics 2018 2019 2020 2021 2022 YoY Commercial Retail disbursements market share (%) effectiveness • Mortgages n/a n/a 17.0% 19.5% 25.0% +5.5pp • Consumer loans n/a n/a 20.2% 21.9% 23.9% +2.0pp • Small business loa
Slide 41: NBG is widely recognised for its digital offering
NBG is widely recognised for its digital offering, as our strategy continues to deliver impressive results ONBOARD ENGAGE CROSS-SELL ONBOA RD Digital subscribers (m) Digital active users1 (m) Digital cumulative sales2 (m) YoY YoY YoY 91% of users rate Registered their experience on subscribers NBG d
Slide 42: Appendix
NATIONAL BANK OF GREECE 6| Appendix
Slide 43: Group Balance Sheet & P&L
Group Balance Sheet & P&L Balance Sheet | Group P&L | Group €m 4Q22 3Q22 2Q22 1Q22 4Q21 €m 4Q22 3Q22 2Q22 1Q22 4Q21 Cash & Reserves 14,226 17,572 15,261 14,530 15,827 NII 421 348 312 288 308 Interbank placements 2,900 3,143 2,711 3,715 3,639 Net fee & commission income 89 88 86 85 74 Securities 13,5
Slide 44: Geographical segment P&L: Greece & International
Geographical segment P&L: Greece & International Greece International¹ €m 4Q22 3Q22 2Q22 1Q22 4Q21 €m 4Q22 3Q22 2Q22 1Q22 4Q21 NII 401 328 294 270 292 NII 21 20 18 18 16 Net fee & commission income 85 85 80 80 70 Net fee & commission income 4 3 5 5 4 Core Income 485 413 375 350 362 Core Income 25 23
Slide 45: 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 FY22 Financial Results Press Release contains financial information and measures as derived from the Group financial statements for the period ended 31 December 2022 and for the year ended 31 December 2021
Slide 46: Definition of financial data, ratios used and alternative performance measures
Definition of financial data, ratios used and alternative performance measures Name Abbreviation Definition Assets held for sale -- Non-current assets held for sale Balance Sheet B/S Statement of Financial Position Cash and Reserves -- Cash and balances with central banks Combined Buffer Requirement
Slide 47: Definition of financial data, ratios used and alternative performance measures
Definition of financial data, ratios used and alternative performance measures Loan / Lending Yield Annualized (or annual) loan interest income over gross performing exposures Loans and advances to customers over due to customers at year/period end, excluding the short term reverse repo facility of
Slide 48: Important Notice – Disclaimer
Important Notice – Disclaimer The information, statements and opinions set out in the FY22 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 inf
Slide 49: 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 50: 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
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