National Bank Of Greece S.a. · ATHEX:ETE
National Bank Of Greece — Q1 2021 Earnings Presentation
49 slides from National Bank Of Greece's earnings presentation, May 28, 2021
Slide 1: 1Q21 Financial Results
1Q21 Financial Results 28 May 2021
Slide 2: Table of Contents
Table of Contents 1 Key Highlights 2 Financial Results 3 Macro 4 ESG Framework 5 Transformation Program Update 6 Appendix
Slide 3: Key Highlights
NATIONAL BANK OF GREECE 1 | Key Highlights
Slide 4: NBG 1Q21 Group financial highlights
NBG 1Q21 Group financial highlights 1Q21 PAT cont. ops 1Q21 COP CoR €578m €95m €77m up by +42% up by 42% yoy¹, reflecting rigorous cost cutting 114bps (annualized basis) Personnel Costs NPEs €4.3b CET1 2 3 -16.5%yoy 16.1% (FL at 14.0%) Net NPEs at €1.5b NPE ratio 13.1% 3,4 G&A Costs 2 NPE Coverage 3
Slide 5: Extensive digital transformation improves our competitive advantages significantly
Extensive digital transformation improves our competitive advantages significantly New digital functionalities Acceleration of digital transformation • Digital on boarding for legal entities in progress • Digital subscribers reach 3.1m (+24% yoy) • Account aggregation for all customers • Mobile app
Slide 6: Project Frontier: transaction well on track, signing and completion in 3Q21
Project Frontier: transaction well on track, signing and completion in 3Q21 Portfolio attributes Securitization structure HAPS¹ eligible c€5.7b of Gross Book Value Retain 100% of senior notes c€3.0b Senior notes (Residential c75%, Corporate & SBLs c20%, Consumer c5%) c€5.7b c90% secured by rea
Slide 7: Payment performance of ex moratoria clients provides optimism
Payment performance of ex moratoria clients provides optimism Corporate & household support measures Ex-moratoria client status • State subsidy programs: • NBG Payment moratoria have expired in full by YE20 - Gefyra I to primary residence mortgages at €1.4b; • c50% of moratoria clients (€ terms) are
Slide 8: Greece's economy is set to bounce back to growth, starting 2Q21
Greece’s economy is set to bounce back to growth, starting 2Q21 Pandemic impact cushioned by increased fiscal support, >€6.0b in 1Q21 GDP growth: NBG monthly indicator and GDP remains actual data cushioned by Targeted restrictions and strengthening industrial activity and goods exports in 15 y-o-y,
Slide 9: c25% of OpEx has been cut – cost savings will continue
c25% of OpEx has been cut – cost savings will continue Personnel & G&As costs (€ m) | Domestic Headcount & branches | Domestic HR cost FTEs (#) Branches (#) (-27%) -2.0k -130 134 127 117 9.8 486 7.5k at Bank level 461 97 9.2 8.5 389 366 G&As 7.9 356 7.8 (-23%) 54 45 44 42 1Q18 1Q19 1Q20 1Q21 1Q18 1Q
Slide 10: Financial Results
NATIONAL BANK OF GREECE 2.| Financial Results
Slide 11: 1Q21 COP up by 42%, reaching €95m; 1Q21 PAT (cont. ops.) at €578m
1Q21 COP up by 42%, reaching €95m; 1Q21 PAT (cont. ops.) at €578m P&L Highlights P&L | Group €m 1Q21 1Q20 YoY 4Q20 QoQ 1Q21 Group PAT (cont. ops.) up by 42% to €578m, on solid NII 294 278 +6% 314 -6% core operating trends and strong trading income. Excluding Net Fees & Commissions 67 66 +1% 68 -2% t
Slide 12: Balance sheet health improves on all fronts as organic NPE reduction continues
Balance sheet health improves on all fronts as organic NPE reduction continues unabated, PE loans increase strongly and capital rises further Asset Quality, Liquidity & Capital Highlights Key P&L Ratios | Group 1Q21 domestic NPE stock nears €4b 1Q21 4Q20 3Q20 2Q20 1Q20 • Organic formation remains ne
Slide 13: CET1 and Total capital at 16.1% and 17.1% (+40bps qoq)
CET1 and Total capital at 16.1% and 17.1% (+40bps qoq); total CAD at 18.8% including Frontier & Ethniki completion 1Q21 Capital movement 18.8% Upon Frontier & 16.7% +1.1% 17.1% Ethniki Insurance completion +1.7% -0.1% -0.6% 11.0% 2 CAD CAD FL: 15.0% 15.7% CET1 FL: 12.8% CET1 FL: 14.0% 16.1% 2 6.19%
Slide 14: 1Q21 group core operating profit reaches €95m, up by +42% yoy
1Q21 group core operating profit reaches €95m, up by +42% yoy Group core operating profit bridge 1Q21 (€ m) Group operating profit decomposition 1Q21 (€ b) COP¹ (€m) 67 95 +42% yoy COP¹ margin (bps) 92 142 +50bps yoy OpEx -9% yoy +42% Operating profit²(€) 425 586 +38% yoy yoy +20 +2 NII +6% yoy -3 9
Slide 15: Funding cost benefits offset NPE NII reduction
Funding cost benefits offset NPE NII reduction due to clean up, allowing domestic NII to expand by 7% yoy in 1Q21 Domestic NIM (€ m) & CoR (bps) Domestic NII breakdown (€ m) NIM¹ 232 223 214 220 210 NII 262 259 290 296 280 250 244 97 104 118 CoR Incl. Covid19 Incl. Frontier provisions (€0.4b) provis
Slide 16: PE loan portfolio continues to grow (+€1.1b yoy)
PE loan portfolio continues to grow (+€1.1b yoy), driven by corporate PEs (+€1.6b yoy); retail deleveraging ends Greek loan evolution: performing loans1 (€ b) Loan disbursements (€ b) 27.6 27.6 28.0 25.5 25.6 Net loans2 FY20 Mortgages Consumer €4.7b SBL Corporate 23.8 24.0 +€1.1b 1.6 23.0 23.5 +5% y
Slide 17: Headline PE lending yields remain at satisfactory levels
Headline PE lending yields remain at satisfactory levels; unprovided, non cash NPE NII at c5% of total NII Greek lending yields1 (bps) Greek forborne & PE yields, NPE NII % 5.5% 5.4% 5.1% 5.0% 4.6% Total 346 337 327 324 318 Dom. NPE NII net of Performing cash collected and provisions / Dom. NII % (y
Slide 18: System liquidity remains abundant leading to yield reductions
System liquidity remains abundant leading to yield reductions Greek deposit yields (bps) Greek deposit evolution (€ b) 72% 80% Core deposits/total +€2.7b/+6.1% yoy 52 41 47.0 46.6 31 23 44.0 43.7 16 Term 43.3 Time 53 9.6 9.3 -€3.1b New -25.3% yoy production 12.4 10.5 10.5 at 11bps 36 13.1 12.1 Sight
Slide 19: Despite the 1Q21 lockdown, domestic fees slightly up yoy
Despite the 1Q21 lockdown, domestic fees slightly up yoy Domestic fees (€ m) Domestic retail fees decomposition (€ m) YoY 40bps 35bps 34bps Fees/Assets1 36 37 36 +1% YoY 65 Intermediation & 10 +5% +22% yoy 63 64 +1% other 12 13 adjusting for the Bancassurance 4 -0% impact from 9 +4% 3 3 internationa
Slide 20: Transactions above pre Covid19 levels, digital channels replacing the branch
Transactions above pre Covid19 levels, despite 1Q21 lockdown, with digital channels replacing the branch Transactions per channel (#, m) Transactions per channel (volume, €m) 1st Lock-down 2nd 1Q21/1Q20 1st Lock-down 2nd 1Q21/1Q20 yoy ±% yoy ±% 43.9 47.6 40.9 40.4 44.7 41.5 42.5 Total -2% +8% Total
Slide 21: Domestic C:CI drops to 52.1%, 8.5ppts lower yoy
Domestic C:CI drops to 52.1%, 8.5ppts lower yoy, reflecting strong cost cutting efforts OpEx by category (€ m) Domestic Branch evolution (#) Domestic Group 528 527 -130 branches 1Q21 1Q20 yoy 1Q21 1Q20 yoy 510 486 Personnel 97 117 -16.5% 103 123 -16.3% 461 G&As 42 44 -3.9% 45 47 -4.2% Depreciation 3
Slide 22: Sustained negative formation in 1Q21 supports NPE guidance for 2021-2022
Sustained negative formation in 1Q21 supports NPE guidance for 2021-2022 Domestic NPE stock per category – 1Q21 (€ b) NPE balance change (€ m, Bank) FNPE & other impaired <90dpd o/w: €0.7b 90+dpd o/w: €0.7b <30dpd <30dpd NPE inflows (+) 289 2.1 2.0 264 258 1.5 140 125 1.3 1.0 0.9 0.9 0.8 0.3 0.3 0.5
Slide 23: Formation across LoBs is either negative or immaterial
Formation across LoBs is either negative or immaterial, as curing remains robust Mortgages (€ m) Consumer (€ m) NPE change1 (€ m) 16 8 -52 -3 -7 -70 -127 Organic -173 -184 -26 -132 -205 -161 -158 -316 -242 -4,326 -2 -46 1Q20 2Q20 3Q20 4Q20 1Q21 -57 -16 1Q20 2Q20 3Q20 4Q20 1Q21 -62 1 -5,682 Inorganic
Slide 24: Domestic NPEs near €4b, while coverage shoots up to 65%
Domestic NPEs near €4b, while coverage shoots up to 65%, with c€1.5b of FNPEs <30dpd Domestic 90dpd ratios and coverage | 1Q21 Domestic 90dpd – NPE bridge (€ b) | 1Q21 Collateral 70% 14% 68% 64% 60% coverage1 25% 106% 16% 90dpd ratio 3 3 109% 7% 7.3% 7.3% 1.5 0.2 4.1 6% 0.1 2.3 90dpd 135% 118.1% 116
Slide 25: S3 loans continue to decline in loan portfolio importance
S3 loans continue to decline in loan portfolio importance Group loan stage evolution (€ b) Group S2 ratio and coverage (%) Group S3 ratio and coverage (%) Δ yoy Stage 3 10.7 10.2 4.4 4.2 -6.5 o/w: €2.5b FPEs €1.8b SICR 30.8% €0.3b +30dpd 29.2% Stage 2 4.8 4.9 4.5 4.6 -0.2 13.7% 14.0% 14.0% ¹ 14.2%¹
Slide 26: Solid track record of transactions of c€12.5b in GBV
Solid track record of 8 transactions of c€12.5b in GBV Jun Jul Nov Jun Oct Nov Jun 2018 2019 2019 2020 2020 2020 2021 Project Earth – Jun18 Project Leo – Nov19 Project Marina– Oct20 Project Frontier • €2.0b • €0.3b • €0.3b • c€6.0b • Unsecured Consumer / • Shipping loans • Cypriot, Corporate, SME •
Slide 27: Funding cost drops to near zero levels
Funding cost drops to near zero levels, reflecting deposit repricing and ECB’s TLTRO funding facility Eurosystem funding (€ b) NBG Funding Cost (bps) 41 31 19 LCR: 250% 12 7 NSFR: 123% 0 2 Repo position : €0.5b Blended -17 -50 -67 -67 -65 ECB² 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 Funding structure (%) 11.6
Slide 28: Domestic deposits are up by 6% yoy (+€2.7b yoy)
Domestic deposits are up by 6% yoy (+€2.7b yoy) Deposit evolution by geography (€ b) NBG domestic deposit flows (€ b) YoY Group 45.5 44.8 45.2 48.5 48.2 +5.9% 4.7 3.4 SEE & 1.5 1.5 1.5 1.5 1.5 +1.5% 1.5 1.1 Other 0.2 0.5 47.0 46.6 +6.1% 44.0 43.3 43.7 Greece -0.3 -2.2 +€11.1b Core: flat Time: -€0.3b
Slide 29: Macro
NATIONAL BANK OF GREECE 3| Macro
Slide 30: Enhanced fiscal stimulus & liquidity support cushioned the hit from the 3rd pandemic wave
Enhanced fiscal stimulus & liquidity support and firms’ adaptability cushioned the hit from the 3rd pandemic wave State primary deficit, tax revenue & primary expenditure Key indicators: Increasing signs of improvement in 1Q21 24 % GDP, 24 18 cumulative 18 31.5% 12 12 State primary expenditure 62,3%
Slide 31: Accelerating vaccinations allowed for the relaxation of restrictions
Accelerating vaccinations allowed for the relaxation of restrictions, bolstering activity and economic sentiment Covid-19 vaccinations in Greece Annual change in turnover of Greek enterprises by sector 150 vaccinations per cumulative doses 7 Health & social work day, in thousands Share of people ful
Slide 32: Greek GDP to rebound in 2Q, strengthened by supportive financial conditions
Greek GDP to rebound in 2Q, strengthened by supportive financial conditions, NGEU inflows and asset price increases Covid-19 Community Mobility: Retail & recreation Effective lending rate, 10yr GGB yield & ASE General Index 60 %, 7day m.a., 60 6 Moody's Fitch S&P index % Ba3 BB BB 40 annual change 4
Slide 33: ESG Framework
NATIONAL BANK OF GREECE 4| ESG Framework
Slide 34: NBG continues to strengthen its ESG ratings and practices
NBG continues to strengthen its ESG ratings and practices ESG ratings ESG recent actions and achievements • Action plan for managing climate-related and environmental Latest risks committed to ECB ESG index rating • E-car financing with 3 new agreements with automotive companies ESG rating BBB • Con
Slide 35: Transformation Program Update
5 Transformation Program Update
Slide 36: Transformation Program supports move towards a new business and operating model
Transformation Program supports move towards a new business and operating model – recent highlights HEALTHY BALANCE EFFICIENCY & BEST BANK FOR SHEET (HBS) AGILITY (ENA) OUR CLIENTS (BBC) • Preparation for Frontier securitization • Granular capacity plan for key Head • Cross-sell campaigns through ne
Slide 37: A digital leap forward creating a new competitive advantage
A digital leap forward creating a new competitive advantage CROSS- ONBOARD ENGAGE SELL Key digital Digital 3.1m Digital 12M 2.2m (+41% Digital ~59k items metrics subscribers (+24% yoy) active users yoy) sales (+79% yoy) Mobile app 2.4m Digital 1M 1.8m (+44% downloads (+54% yoy) active users yoy) New
Slide 38: Appendix
NATIONAL BANK OF GREECE 6| Appendix
Slide 39: Outlook 2022: Reaching a 6% NPE ratio
Outlook 2022: Reaching a 6% NPE ratio on negative formation and transactions of c€1.5b NPE evolution 2020-2022¹ Organic formation 2021-22 -€0.8b +c€1.4b NPE ratio 13.5% €4.2b Assuming moratoria defaults up to a max of NPE ratio €0.6b -c€2.2b c6% c€1.8b 3.4 -c€1.5b 1.9 2 FY20A NPEs Organic inflows Or
Slide 40: Outlook 2022: Organic capital generation yields 2022 CET1 of >16%
Outlook 2022: Organic capital generation and completion of transactions yield 2022 CET1 of >16% • Post Ethniki Insurance and Frontier completion capital ratios will be enhanced by c170bps • 2020-2022 CET1 uplift of c50bps, despite 200bps impact from IFRS9 transitional adjustment Group capital evolut
Slide 41: Outlook 2022: core RoE of c9%
Outlook 2022: core RoE1 of c9% reflects a clean balance sheet and higher efficiency Group core operating profit evolution 2020-2022 CoR of c60bps in FY22 C:CI improvement • NII CAGR -3% c400bps Core RoE • Fees CAGR +10% c9% 1 +c€120m c€490m +c€70m €328m -c€30m • Swift NPE clean up • High coverage •
Slide 42: Group Balance Sheet & P&L
Group Balance Sheet & P&L Balance Sheet¹ | Group P&L¹ | Group €m 1Q21 4Q20 3Q20 2Q20 1Q20 €m 1Q21 4Q20 3Q20 2Q20 1Q20 Cash & Reserves 10,461 9,175 6,750 6,705 5,650 NII 294 314 304 273 278 Interbank placements 2,990 3,440 3,899 3,562 3,794 Net fees & commissions 67 68 65 57 66 Securities 16,833 15,5
Slide 43: Geographical segment P&L: Greece & Other International
Geographical segment P&L: Greece & Other International Greece International¹ €m 1Q21 4Q20 3Q20 2Q20 1Q20 €m 1Q21 4Q20 3Q20 2Q20 1Q20 NII 280 296 290 259 262 NII 14 18 15 14 16 Net fees & commissions 64 65 61 54 63 Net fees & commissions 3 3 3 3 3 Core Income 343 360 351 313 325 Core Income 17 21 18
Slide 44: 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 1Q21 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 2021 and for the year ended 31 Dec
Slide 45: 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 & Reserves -- Cash and balances with central banks Common Equity Tier 1 Ratio CE
Slide 46: Definition of financial data, ratios used and alternative performance measures
Definition of financial data, ratios used and alternative performance measures Net interest income over average interest earning assets. Net Interest Margin equals net interest income divided by the average of interest earning assets (the average of interest Net Interest Margin NIM earning assets at
Slide 47: Important Notice – Disclaimer
Important Notice – Disclaimer The information, statements and opinions set out in the 1Q21 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 48: 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 49: Contact details
Contact details Christos Christodoulou Greg Papagrigoris Group CFO Head of IR +30210 334 3051 +30210 334 2310 cchristodoulou@nbg.gr papagrigoris.gr@nbg.gr Maria Kanellopoulou Panagiotis Alevras Maria Constantinou Investor Relations Officer Investor Relations Officer Investor Relations Officer +30210
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