National Bank Of Greece S.a. · ATHEX:ETE
National Bank Of Greece — Q4 2023 Earnings Presentation
57 slides from National Bank Of Greece's earnings presentation, Mar 12, 2024
Slide 1: 4Q23 Financial Results
4Q23 Financial Results 12 March 2024
Slide 2: Table of Contents
Table of Contents 01 Key Financial Highlights 02 Macro 03 BP 2024-26 and Guidance 04 Financial Results in Detail 05 ESG Update 06 Transformation Program Update 07 Appendix 2
Slide 3: Key Financial Highlights
01 Key Financial Highlights 3
Slide 4: Impressive FY23 financial performance across key metrics
Key Financial Highlights Impressive FY23 financial performance across key metrics Core RoTE | % C:CI | % Loan Disbursements, CET1, Core PAT¹ | € b Core PPI | € b Balances | € b Total Capital | % FY23 Core RoTE 18.3% FY23 C:CI 31.6% FY23 €7.0b CET1 change +c220bps Disbursements² yoy³ FY23 Core PAT 1.
Slide 5: FY23 Core PAT reaches €1.2b up by 2.5x yoy, far surpassing our August guidance
Key Financial Highlights FY23 Core PAT reaches €1.2b up by 2.5x yoy, far surpassing our August guidance Core PAT | € m Core RoTE | % FY22 474 FY23 1,200 692 17.8% 18.3% 16.2% 508 14.3% 332 8.5% 142 6.9% 5.1% 5.2% FY23 guidance <15% 1H22 2H22 1H23 2H23 1Q22 6M22 9M22 FY22 1Q23 6M23 9M23 FY23 Cost to
Slide 6: Core income momentum accelerated in 4Q23, pushing FY23 core PPI 2.0x higher
Key Financial Highlights Core income momentum accelerated in 4Q23, pushing FY23 core PPI 2.0x higher Profitability “jaws” | € m Core profitability | € m 732 683 646 584 1,810 2.0x yoy Core 510 PPI 912 +4% 499 qoq 436 481 448 Loan & other Core 398 impairments -280 -241 -14% yoy Income 373 383 288 239
Slide 7: Deposit mix: best in class; deposits increase by +€1.7b yoy
Key Financial Highlights Deposit mix: best in class; deposits increase by +€1.7b yoy NBG Deposit¹ flows ytd (€ b) NBG Deposit¹ mix (%) 4% 3% 3% 3% 3% +€1.7b 12% 16% 18% 19% 19% Corporate liquidity drawdowns >27% mkt share o/w 84% 81% c36% in 80% 79% 79% savings +€0.4b +€1.3b 2 1H23 2H23 other Time C
Slide 8: NPE ratio at 3.7% down by 150bps yoy
Key Financial Highlights NPE ratio at 3.7% down by 150bps yoy NPE stock and flow (€ b) NPE decomposition (€ b) c43% of NPE stock <30dpd 1.8 1.8 -0.7 0.1 International 0.2 1.3 0.2 1.3 0.5 0.1 0.2 FNPEs >30dpd & other impaired 0.6 FNPE <30dpd 0.9 1.1 0.5 90+ dpd FY22 Inorganic organic FY23 FY22 FY23 G
Slide 9: Macro
NATIONAL BANK @ OF GREECE 02 Macro
Slide 10: Outperformance of the Greek economy vs the euro area and a strong start to 2024
Macro Outperformance of the Greek economy vs the euro area and a strong start to 2024 Economic activity remained on a healthy upward trend in 2023 despite the unfavorable Increased 10 contributions yoy 10 external environment, monetary tightening and heightened pressure from natural contribution of
Slide 11: Growth catalysts and reforms bolster economic prospects for 2024 and beyond
Macro Growth catalysts and reforms bolster economic prospects for 2024 and beyond • Growth impact of the RRF set to increase in 2024-2026, as final expenditure (c. 15% RRF absorption at c.50% of total funding Loans 1.7 1.8 1.8 2.0 5.5 of total funding until end-2023) lags behind the rapid absorption
Slide 12: Increasing household income and wealth, support household spending and investment
Macro Increasing household income and wealth, support household spending and investment Unemployment rate at a 14- Labor market conditions year low 20 yoy % 30 support real disposable 10 yoy 10 income and consumption 15 25 5 5 10 20 0 0 5 15 0 -5 -5 Private Consumption (constant 10 Employment (yoy,
Slide 13: Greek corporates outperform EU peers, transitioning to an investment-led model
Macro Greek corporates outperform EU peers, transitioning to an investment-led model Business profits on the 120 70 Remarkable 70 70 €mn €bn index rise combined with outperformance of Greek 65 65 100 60 increasing stock market manufacturing against 60 60 turnover 50 euro area peers 80 55 55 40 50 50
Slide 14: Impressive fiscal rebalancing and sizeable pools of official financing
Macro Impressive fiscal rebalancing and sizeable pools of official financing 10 pps Sustained fiscal 5 %GDP Impressive decline in overperformance bolstered by 4 public debt / GDP on rapid 0 macroeconomic tailwinds 3 budget rebalancing and GDP growth -10 2 1 -20 0 Cumulative change in -30 -1 gross pu
Slide 15: BP 2024-26 and Guidance
03 BP 2024-26 and Guidance 15
Slide 16: 2023 results outperform our updated targets by a wide margin
BP 2024-26 and Guidance 2023 results outperform our updated targets by a wide margin Guidance Guidance Delivery Financial performance metrics Actual Mar’23 Aug’23 Clean balance sheet, P&L KPIs FY23 FY23 FY23 with normalizing CoR Net Interest Margin (bps) >240 >300 303 Cost to Core Income c42% <35% 3
Slide 17: Targeting >13% core RoTE for 2026 and >500bps of 3-year organic capital generation
BP 2024-26 and Guidance Targeting >13% core RoTE for 2026 and >500bps of 3-year organic capital generation Updated Guidance Financial performance metrics Actual Core income 2024-2026 resilience despite P&L KPIs FY23 FY24E FY26E record high levels Net Interest Margin (bps) 303 <290 <270 Cost to Core
Slide 18: Core PAT in excess of €1.2b in 2026 despite rate normalization
BP 2024-26 and Guidance Core PAT in excess of €1.2b in 2026 despite rate normalization Core PAT evolution (€b) Key drivers Net Interest Income (-) low (+) high (+) low (-) mid CAGR sds sds sds sds • Healthy credit expansion throughout the period, structural hedges in place and fixed rate assets miti
Slide 19: Loan CAGR of c7% driven by Corporates; Retail to support growth from 2025 onwards
BP 2024-26 and Guidance Loan CAGR of c7% driven by Corporates; Retail to support growth from 2025 onwards c9% CAGR c2% CAGR Corporate balances Retail balances c5% c8% c4% Large Mortgages Corporates c5% c10% SMEs Consumer loans 0% Shipping SBL FY23 FY26 FY23 FY26 • Maintain leadership in energy trans
Slide 20: Further increase in already strong capital buffers, bodes well for distributions
BP 2024-26 and Guidance Further increase in already strong capital buffers, bodes well for distributions Group CET1 ratio evolution (%) Key drivers • Common Equity Tier 1 (CET1) ratio: Organic capital generation >500bps Driven by sustainable profitability, comfortably accommodating credit >900bps ex
Slide 21: Investment in IT infrastructure and technology; CBS replacement completion in 2025
BP 2024-26 and Guidance Investment in IT infrastructure and technology; CBS replacement completion in 2025 NBG IT strategy is based on 5 strategic pillars 1 Offer the best digital banking experience to our customers • Provide the best digital experience for our retail customer base as well as SB, SM
Slide 22: Financial Results in Detail
04 Financial Results in Detail 22
Slide 23: FY23 Group core PAT of €1.2b and Core RoTE>18%, driven by core income
Financial Results in Detail FY23 Group core PAT of €1.2b and Core RoTE>18%, driven by core income (+54% yoy) P&L Highlights P&L | Group (€ m) FY23 FY22 YoY 4Q23 QoQ 4Q23 Group core PAT at €345m, on the back of accelerated core income growth (+7% NII 2,263 1,369 +65% 623 +6% Net fee & commission qoq)
Slide 24: Accelerated loan expansion in 4Q23, leads FY23 PEs +€1.3b higher
Financial Results in Detail Accelerated loan expansion in 4Q23, leads FY23 PEs +€1.3b higher, in line with guidance Balance sheet Highlights Key Balance Sheet items & ratios | Group Key Balance sheet items FY23 9M23 6M23 3M23 FY22 Disbursements accelerate to €2.6b in 4Q23 Total Assets (€ b) 74.6 73.
Slide 25: FY23 CET1 increases by a record +220bps yoy post dividend provision
Financial Results in Detail FY23 CET1 increases by a record +220bps yoy post dividend provision for a 30% payout FY23 FL capital movement1 20.2% +c3.6% +c0.0% CAD FL 16.8% -c0.7% -c0.7% 90bps (or 30% payout) accrued from 4Q22 to 4Q23 Organic capital generation of 290bps 18.6% 17.8% CET1 FL 15.7% FY2
Slide 26: A unique comparative advantage is our Fortress balance sheet
Financial Results in Detail A unique comparative advantage is our “Fortress balance sheet” Group Assets1 (€ b) Group Liabilities1 (€ b) Cash & Interbank 2.0 Excess liquidity at €8.0b, reserves 7.2 factoring in TLTRO repayment and net interbank position Interbank 2.8 Securities² 17.2 Securities portf
Slide 27: FY23 Group COP up by nearly 3x, on strong core income momentum and cost control
Financial Results in Detail FY23 Group COP up by nearly 3x, on strong core income momentum and cost control Group COP (€ m) Group operating profit (€ m) 1,662 +70% yoy +€55m yoy excl. impact 2.8x yoy of merchant acquiring deconsolidation 93 1,569 +35 +39 +894 -11 -3 -16 975 CoR at 64bps in FY23 vs 7
Slide 28: NII momentum in 4Q23 is aided by higher average base rates
Financial Results in Detail NII momentum in 4Q23 is aided by higher average base rates Group NII (€ m), Group NIM (bps) Domestic NII breakdown (€ m) +125bps 322 337 yoy 297 260 NIM¹ (Group) 212 396 +218bps 401 474 529 563 594 378 336 264 yoy 3M Euribor (avg) 178 623 588 29 554 25 497 25 443 23 429 4
Slide 29: Disbursements accelerate to €2.6b in 4Q23 (€7.0b in FY)
Financial Results in Detail Disbursements accelerate to €2.6b in 4Q23 (€7.0b in FY)¹; Group PEs up by +€1.3b yoy Group loan evolution | PE loans (€ b) Loan disbursements¹ (€ b) Additional €0.7b extended by subsidiaries +€1.3b Group 29.2 29.1 29.0 29.6 30.5 +5% yoy FY22 FY23 Int’l 1.6 1.6 1.6 1.6 1.6
Slide 30: Loan pass through rate of 73% in 4Q23, underpins a healthy lending spread normalization
Financial Results in Detail Loan pass through rate of 73% in 4Q23, underpins a healthy lending spread normalization Greek PE lending spreads¹ (bps) Greek NPE NII | % Total Performing 275 269 260 234 229 Dom. NPE NII³ 3M Euribor /Dom. NII % 5.9% (avg) 178 264 336 378 396 4.4% 3.5% 1.2% Consumer² 715
Slide 31: Domestic deposits, up by +€1.7b in 2023 reflecting retail customer dynamics
Financial Results in Detail Domestic deposits, up by +€1.7b in 2023 reflecting retail customer dynamics Group deposits evolution (€ b) Greek deposit spreads¹ (bps) Group 55.2 54.8 55.7 56.3 57.1 +€1.9b yoy Demand Average savings 373 390 balance c€4k Int’l 1.8 1.8 1.9 1.9 2.0 331 260 176 54.4 55.1 +€
Slide 32: Strong net cash position of €8.0b; MREL resources already ahead of Jan25 target
Financial Results in Detail Strong net cash position of €8.0b; MREL resources already ahead of Jan25 target 396 TLTRO, Cash & reserves, Net Interbank (€ b) NBG Funding Cost (bps) 378 3M Euribor (avg) 336 NBG is a net lender in the interbank market 7.4 8.0 264 14.2 10.0 178 8.4 9.0 TLTRO 8.1 7.6 58 6
Slide 33: Domestic fees +17% yoy, driven by lending, trade finance and investment products
Financial Results in Detail Domestic fees +17% yoy, driven by lending, trade finance and investment products Group fees (€ m) Domestic retail fees (€ m) Fees/Assets 43bps 51bps ΥοΥ ΥοΥ +22% yoy ex 382 +10% 203 +13% merchant 347 15 acquiring 25 179 22 +16% 17 +17% yoy ex 34 Negatively Deposits 19 aff
Slide 34: Cost discipline continues with transformation driving FTE optimization
Financial Results in Detail Cost discipline continues with transformation especially digital driving FTE optimization Group C:CI (%) Group headcount¹ (#k) Optimization supported by digital strategy 19.8 implementation Cost/ core income % 46.9 31.6 31.9 -15.3bps yoy 7.8 6.5 at Bank level Personnel co
Slide 35: Organic formation €0.2b for FY23 remained well inside our expectations
Financial Results in Detail Organic formation €0.2b for FY23 remained well inside our expectations Domestic NPE stock per category | 4Q23 (€ b) NPE balance change (€ b, Bank) o/w: €0.3b or c43% <30dpd 0.9 0.2 o/w: €0.2b or NPE inflows (+) 0.1 0.1 0.1 0.1 c72% <30dpd 0.7 -0.1 -0.1 -0.1 -0.1 Curings -
Slide 36: NPE ratio at 3.7%, coverage at 88%
Financial Results in Detail NPE ratio at 3.7%, coverage at 88% NPE ratios and coverage | 4Q23 Domestic forborne stock (€ b) | 4Q23 Collateral coverage1 73% 69% 71% FNPE<30 dpd 0.6 NPE ratio 5.2% FPE 1.3 3.7% 3.7% €2.0b 3.0% FNPE 31-90dpd 0.0 NPE coverage2 82% FNPE >90dpd 87.2% 87.5% 0.1 91% Retail C
Slide 37: Sector leading coverage levels across stages
Financial Results in Detail Sector leading coverage levels across stages Group gross loan stage evolution (€ b) Group S2 ratio and coverage (%) Group S3 ratio and coverage (%) Δ yoy Stage 3 1.8 1.8 1.3 13.8% 1.3 -0.5 12.3% o/w: €1.3b FPEs €1.4b SICR 10.7% €0.4b +30dpd 9.3% Ratio Stage 2 4.5 4.1 3.5
Slide 38: ESG Update
05 ESG Update 38
Slide 39: Committing to net zero following a rigorous science-based target-setting process
ESG Update Committing to net zero following a rigorous science-based target-setting process “Science-based” target-setting Net-zero target-setting at NBG Value creation potential for NBG • Clearly-defined pathways for companies to • Baselining of financed emissions in full • Clear understanding of G
Slide 40: Ambitious emissions targets substantiate our net zero commitment
ESG Update Ambitious emissions targets substantiate our net zero commitment NBG is the first Greek systemic bank to join PCAF and first to join the NZBA with declared emissions reduction targets Sector/ Scopes Unit of Reference Scenario / 2022 Baseline 2030 2030 2050 Portfolio Covered Measurement Pa
Slide 41: Net-zero targets underpinned by our business and value-creation strategy
ESG Update Net-zero targets underpinned by our business and value-creation strategy C&E strategic themes and 2023 highlights Corporate financing 2.0 Lead the market in sustainable energy financing 1.6 to RES producers (€ b) • Leading franchise in Greece for RES large projects and small-scale solar s
Slide 42: ESG governance structure has been further strengthened
ESG Update ESG governance structure has been further strengthened 1 2 3 Board & Board Committees Top Executives & Management Committees 1st & 2nd line functions • Incorporation and oversight of ESG considerations • Definition and oversight of ESG strategy as integral • C&E Strategy and Social Strate
Slide 43: Broad recognition of our ESG activity and best practices
ESG Update Broad recognition of our ESG activity and best practices NBG upgrade ESG ratings and indices 2021 2022 2023 Years of coverage MSCI ESG rating BBB BBB A 10 ISS ESG score (E | S | G) 2|2|2 1|2|2 1|1|2 6 CDP Carbon disclosure score C C C1 17 35.1 25.8 16.4 Sustainalytics ESG score 12 (Core)
Slide 44: Transformation Program (TP) Update
06 Transformation Program (TP) Update 44
Slide 45: Our TP is a competitive edge, supporting change and target achievement
Transformation Program Update Our TP is a competitive edge, supporting change and target achievement 12M23 highlights BEST BANK FOR OUR BEST BANK FOR OUR SPECIALIZED ASSET EFFICIENCY & CLIENTS (BBC Corporate) CLIENTS (BBC Retail) SOLUTIONS (SAS) AGILITY (ENA) • Migration to new centralized • Impleme
Slide 46: Transformation supports our move towards a new commercial & operating model
Transformation Program Update Transformation supports our move towards a new commercial & operating model Selected metrics 2018 2019 2020 2021 2022 2023 YoY Commercial Corporate PE market share (%) 24.7% 26.0% 26.6% 26.4% 26.1% 26.6% +0.5pp effectiveness Retail disbursements market share (%) n/a n/a
Slide 47: We are widely recognised for impressive results in our digital transformation
Transformation Program Update We are widely recognised for impressive results in our digital transformation CROSS- ONBOARD ENGAGE SELL Mobile app downloads (m) Digital active users1 (m) Digital cumulative sales2 (m) 4.3 Active users 12M 3.6 2.9 2.7 2.9 2.5 2.1 1.2 2.3 2.4 2.3 2.0 Active 0.8 1.4 user
Slide 48: Appendix
07 Appendix 48
Slide 49: Balance Sheet & P&L
Appendix Balance Sheet & P&L Balance Sheet | Group P&L | Group €m 4Q23 3Q23 2Q23 1Q23 4Q22 €m 4Q23 3Q23 2Q23 1Q23 4Q22 Cash & Reserves 9,015 8,400 7,551 9,950 14,226 NII 623 588 554 497 421 Interbank placements 2,792 2,330 2,735 2,731 2,900 Net fee & commission income 109 95 92 87 89 Securities 17,2
Slide 50: Geographical segment P&L: Greece & International Group
Appendix Geographical segment P&L: Greece & International Group Greece International €m 4Q23 3Q23 2Q23 1Q23 4Q22 €m 4Q23 3Q23 2Q23 1Q23 4Q22 NII 594 563 529 474 401 NII 29 25 25 23 21 Net fee & commission Net fee & commission 106 92 87 83 85 4 4 5 3 4 income income Core Income 700 654 616 557 485 Co
Slide 51: ESMA Alternative Performance Measures (APMs), financial data and ratios definitions
Appendix ESMA Alternative Performance Measures (APMs), financial data and ratios definitions The 4Q23 Financial Results Presentation contains financial information and measures as derived from the Group financial statements for the period ended 31 December 2023 and for the year ended 31 December 202
Slide 52: Definition of financial data, ratios used and alternative performance measures
Appendix Definition of financial data, ratios used and alternative performance measures Name Abbreviation Definition Assets held for sale -- Non-current assets held for sale Cash and Reserves -- Cash and balances with central banks Combined Buffer Requirement CBR Total CET1 capital required to meet
Slide 53: Definition of financial data, ratios used and alternative performance measures
Appendix 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 In
Slide 54: Important Notice – Disclaimer
Appendix Important Notice – Disclaimer The information, statements and opinions set out in the 4Q23 Results Presentation and Performance Measures (“APMs”), definition of financial data and ratios used” and may not accompanying discussion (the “Presentation”) have been provided by National Bank of be
Slide 55: Important Notice – Forward Looking Information
Appendix Important Notice – Forward Looking Information The Presentation contains forward-looking statements relating to management’s intent, Forward Looking Statements are provided for illustrative purposes only and are not belief or current expectations with respect to, inter alia, the Bank’s busi
Slide 56: Contact details
Contact details Christos Christodoulou Group CFO Greg Papagrigoris Group Head of IR +30 210 334 3051 +30 210 334 2310 cchristodoulou@nbg.gr papagrigoris.gr@nbg.gr Maria Kanellopoulou Panagiotis Alevras +30 210 334 1537 +30 210 772 7292 mkanellopoulou@nbg.gr Alevras.Pan@nbg.gr Marios Deportou George
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