National Bank Of Greece S.a. · ATHEX:ETE
National Bank Of Greece — Debt Investor Presentation (December 2021)
46 slides from National Bank Of Greece's debt investor presentation, December 2021
Slide 1: Investor Presentation Credit Update December 2021
Investor Presentation Credit Update December 2021
Slide 2: Disclaimer
Disclaimer Not an Offer to Sale The information contained herein is not and must not be construed to be an offer to sale or to purchase or an invitation or any type of solicitation or a recommendation or an advice to invest in any way on the shares or any other security issued or to be issued by the
Slide 3: Table of Contents
Table of Contents 01 Macro 02 Bank Overview 03 Profitability & Balance Sheet Evolution 04 Asset quality 05 Capital, MREL, Liquidity & Funding 06 Appendix 2
Slide 4: 01 Macro
NATIONAL BANK 01} Macro
Slide 5: Catalysts and challenges for sustainable recovery in 2022
01 Macro Catalysts and challenges for sustainable recovery in 2022 Recovery & Resilience Facility: A unique opportunity for Greece The first tranche of RRF financing – equivalent to 13% of the country's grant & loan allocation – was disbursed in August 2021 amounting to €4,0 bn Up to €5,0 bn in gran
Slide 6: The turnaround in economic activity is strong and widespread
01 Macro The turnaround in economic activity is strong and widespread, with several activity metrics surpassing their pre-pandemic levels Real GDP: Heading to a V-shaped recovery Several activity metrics exceeded their 2Q19 level in 2Q21 48000 y-o-y, % 20 € mn 15 Investments 17,0 46000 10 44000 5 Go
Slide 7: Buoyant exports of goods and services bolstered growth in 2021
01 Macro Buoyant exports of goods and services bolstered growth in 2021 with further upside in 2022 International arrivals at Greek airports closer to 2019 levels Exports of goods (excl. oil) 4,5 y-o-y 40 mn persons €bn 2,5 4,0 30 3,5 2,0 20 3,0 1,5 10 2,5 2,0 0 1,0 1,5 -10 1,0 0,5 -20 0,5 0,0 -30 M
Slide 8: Upward trend continued leading to upward revisions in GDP growth forecasts
01 Macro The upward trend continued unabated until October leading to upward revisions in GDP growth forecasts for 2021 Turnover (total & retail sector), goods exports & Greek GDP growth forecast for 2021 and 2022 manuf. production 50 50 2021 2022 2021 2022 2021 2022 y-o-y 8 40 40 7.5% 7.0% 7.1% 30
Slide 9: NBG's view on Greece's economic outlook
01 Macro NBG’s view on Greece’s economic outlook Table: Key macros for the Greek economy – Consensus view GDP growth decomposition by expenditure component Key macroeconomic indicators of the Greek Economy contributions 16 in pps 2020 2021f 2022f 2023f 2024f 2025f 12 Nominal GDP (y-o-y) -9,8 7,6 6,3
Slide 10: 02 Bank Overview
02 Bank Overview 9
Slide 11: NBG at a glance
02 Bank Overview NBG at a glance Trusted brand 9M21 PAT at €714m¹ Balance sheet metrics with more than (+19%yoy) continue to improve 100 years of history Branches 341 9M PAT €714mn LCR 266% FTEs 8,9k NIM2 215bps NSFR 134% Total assets €81,6bn Cost to core income 50% L:D 52% NPE 70,2%/ Gross Loans €3
Slide 12: Group and Shareholder Structure
02 Bank Overview Group and Shareholder Structure Group Structure (material subsidiaries) Shareholder Structure1 Domestic institutional & retail 15,00% Hellenic Financial Stability Fund; Μarket cap: €2,5bn 40,4% International institutional; 44,6% Ethniki Insurance and NBG Cyprus have been reclassifie
Slide 13: Our Transformation Program underpins a new business and operating model
02 Bank Overview Our Transformation Program underpins a new business and operating model HEALTHY BALANCE EFFICIENCY & BEST BANK FOR SHEET (HBS) AGILITY (ENA) OUR CLIENTS (BBC) • Migration of Frontier portfolio and • Further reduction of staff costs through • Operational setup to support Corporate de
Slide 14: The Bank's Transformation Plan delivers value for its investors
02 Bank Overview The Bank’s Transformation Plan delivers value for its investors Profitability1 Asset Quality, Capital & Liquidity1 2018 2019 2020 9M 2021 2018 2019 2020 9M 2021 Net Interest 272bps 268bps 228bps 215bps NPE Coverage 59,2% 53,4% 63,3% 70,2% Margin Fees / Total 40,4% 31,3% 11,8%5 43bps
Slide 15: NBG credit positioning vs. domestic peers across various metrics
02 Bank Overview NBG credit positioning vs. domestic peers across various metrics1 Liquidity & Capital2 MREL Resources3 LCR 266% 168% 189% 199% MREL 18,3% 18,1% 17,7% 18,0% Total 16,5% Resources 17,0% 15,7% 14,4% Capital (Phased 16,4% 1,3% 1,3% 1,6% -in) 0,7% 2,5% 13,9% 2,6% 1,9% Phased-in 13,3% 2,3
Slide 16: The Bank targets a RoE of c.9% and CET1 of c.16% in YE2022
02 Bank Overview The Bank targets a RoE of c.9% and CET1 of c.16% in YE2022 NPE Organic formation 2021-22 -€0.8b ratio +c€1,4b 13.5% €4,2b NPE ratio NPE ratio Assuming moratoria defaults -c€2,2b c6% up to a max of €0.6b c€1.8b -c€1,5b FY20A NPEs Organic inflows Organic outflows Sales/securitizations
Slide 17: Solid track-record of NPE disposals
04 Asset Quality Solid track-record of NPE disposals Purchaser Servicer Completed: Total c.€6.0bn Signed: c.€6.0bn Project Earth: €2.0b Project Symbol: €0.9b Project Icon: €1.6b Project Marina: €0.3b Consumer / Credit Cards, SBL Secured SME/ SBL Secured Large Corporate, SME Cypriot Corporate, SME &
Slide 18: NBG continues to strengthen its ESG ratings and practices
02 Bank Overview NBG continues to strengthen its ESG ratings and practices ESG ratings ESG recent actions and achievements Latest • NBG’s Climate & Environmental Risk Action Plans ranked among ESG index best in Europe in terms of adequacy by the ECB; implementation rating of action plans is on track
Slide 19: 03 Profitability & Balance Sheet Evolution
03 Profitability & Balance Sheet Evolution 18
Slide 20: 9M21 group COP reaches €341m, up by +49% yoy
03 Profitability & Balance Sheet Evolution 9Μ21 group COP reaches €341m, up by +49% yoy driven by all core operating lines Group operating result bridge 9M21 (€ m) Group operating profit decomposition 9M21 (bps) +49% OpEx COP (€m) 228 341 +49% yoy yoy -8% yoy COP margin (bps) 105 170 +65bps yoy +52
Slide 21: Sustained NII resilience (+5% yoy)
03 Profitability & Balance Sheet Evolution Sustained NII resilience (+5% up yoy), benefits from the expansion of the PE loan book and lower funding costs Domestic NII breakdown (€ m) Domestic NIM & CoR (bps) +5% yoy €811m €853m NIM NII 262 259 290 296 280 283 291 232 214 220 223 210 209 213 250 244
Slide 22: 9M21 Fees grow by 11% yoy
03 Profitability & Balance Sheet Evolution 9Μ21 Fees grow by 11% yoy as retail, corporate and non core banking fees maintain a recovery trend Domestic fees (€ m) Domestic retail fees decomposition (€ m) Fees/Assets 34bps 35bps 35bps 34bps YoY YoY 199 +11% 111 +8% 179 Intermediation 103 26 +35% 19 &
Slide 23: Domestic C:CI drops to 50% in 9M21
03 Profitability & Balance Sheet Evolution Domestic C:CI drops drops to 50% in 9M21, nearly 8 ppts lower yoy Group OpEx by category (€ m) Domestic Branch evolution (#) Domestic Group 527 -48 510 9M21 9M20 Yoy 2y± 9M21 9M20 Yoy 2y± branches 486 Personnel 289 339 -14.8% -22% 306 358 -14.5% -21% 461 G&
Slide 24: Domestic sector-high PE loan additions continue
03 Profitability & Balance Sheet Evolution Domestic sector-high PE loan additions continue (+€0.8b yoy), driven by net loan disbursements of €2.8b Greek loan evolution; performing loans (€ b) Loan disbursements (€ b) 28.0 25.5 25.6 25.7 25.5 Net loans +18% yoy excl Covid-19 Mortgages Consumer SBL Co
Slide 25: Deposit yields near zero levels
03 Profitability & Balance Sheet Evolution Deposit yields near zero levels driven by abundant system liquidity and negative rates Greek deposit yields (bps) Greek deposits evolution (€ b) 32 76% 84% Core deposits/total +€5.9b 49,6 49,6 +13.5% yoy 31 47,0 46,6 Time 43,7 8,8 8,0 -€2.4b 23 9,6 9,3 -23.
Slide 26: 04 Asset quality
NATIONAL BANK 04 | Asset quality 25
Slide 27: The Bank has decreased its stock of NPEs by ~€18,2bn since 2015
04 Asset Quality The Bank has decreased its stock of NPEs by ~€18,2bn since 2015 -€18,2b NPE 49,0% Ratio 44,9% 43,9% 40,9% 2,8 1,5 32,2% 2,1 NPEs 22,0 (€bn) 4,8 19,2 17,7 15,6 13,6% 11,8% 10,8 6,0% 6,4 0,6 4,4 3,8 2,0 1,8 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 Q3 2021 FY 2022E 26
Slide 28: Formation remains negative, supporting 2021-22 NPE reduction guidance
04 Asset Quality Formation remains negative, supporting our 2021-22 guidance for cumulative organic NPE reduction of €0.8b Domestic NPE stock per category – 3Q21 (€ b) NPE balance change (€ m, Bank) o/w: €0.6b or 82% <30dpd o/w: €0.5b or 91% <30dpd 2,0 1,9 NPE inflows (+) 264 258 1,2 125 166 159 1,0
Slide 29: Domestic NPEs drop further to €3.7b in 3Q21
04 Asset Quality Domestic NPEs drop further to €3.7b in 3Q21, with nearly 1/3 being FNPEs <30dpd; coverage exceeds 70% Domestic 90dpd ratios and coverage | 3Q21 Domestic 90dpd – NPE bridge (€ b) | 3Q21 Collateral 79% 14% 73% 58% 60% coverage1 23% 15% 104% 90dpd ratio 3 3 112% 7,2% 7,2% 6% 6% +1,2 +0
Slide 30: S3 loans continue on a declining trend
04 Asset Quality S3 loans continue on a declining trend with their coverage increasing to 59% Group loan staging and evolution (€ b) Group Stage 2 ratios and coverage (%) Group Stage 3 ratios and coverage (%) Δ yoy 10,2 Stage 3 4,4 4,1 3,8 -6.4 o/w: €2.6b FPEs €1.8b SICR €0.2b +30dpd 29,2% Stage 2 4
Slide 31: 05 Capital, MREL, Liquidity & Funding
05 Capital, MREL, Liquidity & Funding 30
Slide 32: CET1 and Total capital at 16.4% and 17.0%
05 Capital, MREL, Liquidity & Funding CET1 and Total capital at 16.4% and 17.0%; total CAD at c19% including Frontier & Ethniki Insurance completion Capital evolution - bridge Regulatory capital requirements Frontier and Ethniki Insurance closing c19% +1,7% 16.7% Total Capital Total Capital 17.0% -0
Slide 33: Sovereign, bank and debt ratings on upwards trajectory
05 Capital, MREL, Liquidity & Funding Sovereign, bank and debt ratings on upwards trajectory Greece’s and NBG’s ratings Greece’s and NBG’s average rating evolution Next scheduled update - - - for the sovereign Hellenic Ba3 BB BB Republic BB+ (stable) (stable) (positive) (outlook) BB National BB- Ban
Slide 34: NBG MREL Requirements vs Capacity
05 Capital, MREL, Liquidity & Funding NBG MREL Requirements vs Capacity (as per Q3 2021) Considerations Interim binding MREL Target (01/01/2022) 18,04% 18,34% ➢ SRB has set the binding interim MREL Senior preferred 1,3% target for 1st January 2022 at 14,79% of 3,25% CBR RWAs (18,04% incl. applicable
Slide 35: Sound liquidity profile provides strong foundation for creditors
05 Capital, Liquidity & Funding Sound liquidity profile provides strong foundation for creditors Liquidity Coverage Ratio Net Stable Funding Ratio Bank(%) (Bank, %) 266% 140% 280% 240% 130% 134% 200% 120% 160% 110% 120% 80% 100% 40% 90% 0% 80% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q1 Q2 Q3 Q4
Slide 36: Funding cost at zero levels
05 Capital, Liquidity & Funding Funding cost at zero levels, benefits from all time low deposit rates and ECB’s TLTRO facility Funding Cost Evolution (bps) Eurosystem funding (Bank, €bn) TLTRO III 41 31 19 12 7 0 2 1 0 -17 Blended 11,6 11,6 11,6 10,5 10,5 10,5 -50 -67 -67 -65 -65 -64 ECB1 3,4 2,3 Q4
Slide 37: 06 Appendix
NATIONAL BANK 06 | Appendix 36
Slide 38: Group Balance Sheet & P&L
06 Appendix Group Balance Sheet & P&L Balance Sheet | Group P&L | Group €m 3Q21 2Q21 1Q21 4Q20 3Q20 €m 3Q21 2Q21 1Q21 4Q20 3Q20 Cash & Reserves 11,464 10,802 10,461 9,175 6,750 NII 306 297 294 314 304 Interbank placements 3,114 2,875 2,990 3,440 3,899 Net fees & commissions 73 69 67 68 65 Securities
Slide 39: Geographical segment P&L: Greece & International
06 Appendix Geographical segment P&L: Greece & International Greece International €m 3Q21 2Q21 1Q21 4Q20 3Q20 €m 3Q21 2Q21 1Q21 4Q20 3Q20 NII 291 283 280 296 290 NII 15 15 14 18 15 Net fees & commissions 69 66 64 65 61 Net fees & commissions 4 3 3 3 3 Core Income 360 349 343 360 351 Core Income 19 1
Slide 40: Covered bonds reintroduced NBG to the capital markets
06 Appendix Covered bonds were utilized as the instrument to reintroduce NBG to the capital markets Summary Terms Allocations Issuer National Bank of Greece S.A. Issue Ratings B / B3 (Fitch / Moody’s) Geography Investor Type Other Issuer Ratings RD / Caa2 positive / CCC+ Stable (Fitch / Moody’s / S&
Slide 41: NBG's inaugural Tier2 issuance in 2019
06 Appendix NBG’s inaugural Tier2 issuance in 2019 signaled continued market access Summary Terms Allocations Issuer National Bank of Greece S.A. Issuer Rating Caa1 (Moody’s) / B- (S&P) / CCC+ (Fitch) Geography Investor Type Issue Rating Caa2 (Moody’s) / CCC (S&P) / CCC- (Fitch) Other; 5% Notes Subo
Slide 42: Inaugural Green Senior Preferred EUR500m issuance
06 Appendix NBG’s inaugural Green SP EUR500m 6NC5 marks the first MREL senior issuance and first issuance in green format from a Greek bank Summary Terms Allocations Issuer National Bank of Greece S.A. Issuer Rating Caa1 (Moody’s) / B- (S&P) / CCC+ (Fitch) Issue Rating Caa1 (Moody’s) / B (S&P) / CCC
Slide 43: ESMA Alternative Performance Measures, definition of financial data
06 Appendix ESMA Alternative Performance Measures (APMs), definition of financial data and ratios used This presentation contains financial information and measures as derived from the Group and the Bank financial statements for the period ended 30 June 2020 and for the year ended 31 December 2019,
Slide 44: Definition of financial data, ratios used and APMs (continued)
06 Appendix Definition of financial data, ratios used and APMs (continued) Name Abbreviation Definition Balance Sheet B/S Statement of financial position Third covered bond CBPP3 ECB Covered Bond Purchase Programme purchase programme Common Equity Tier 1 CET1 ratio CET1 capital as defined by Regulat
Slide 45: Definition of financial data, ratios used and APMs (continued)
06 Appendix Definition of financial data, ratios used and APMs (continued) Net interest income over average interest earning assets. Net Interest Margin equals net interest income divided by the average of interest earning assets Net Interest Margin NIM (the average of interest earning assets at the
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