1Q24 Financial Results
PRESS RELEASE
1 May 2024
1Q24 Results
Strong 1Q24 performance across KPIs
Solid 1Q24 results support our guidance
Attributable PAT | Core PAT¹ |
€358m +38% yoy | €320m +45% yoy |
Attributable RoTE | Core RoTE |
19.7% +c280bps yoy | 17.6% +c330bps yoy |
Strong trends in core operating performance
NII | Core income |
€606m +22% yoy | €705m +21% yoy |
Core PPI | C:CI |
€494m +29% yoy | 29.9% -c450bps yoy |
Solid asset quality and performing loan expansion
Disbursements | Net NPEs €0.2b | |||
€1.1b in 1Q24 & €0.85b in April | ||||
NPE ratio 3.7% | ||||
Performing loans | ||||
NPE coverage 86.1% | ||||
+€1.1b yoy at €30.2b | ||||
Class leading capital position
CET12 | Total capital2 | MREL ratio2 |
18.6% | 21.3% | 26.5% |
+80bps qoq | +110bps qoq | Jan25 target at 25.3% |
1 Core PAT excludes trading and other income | 2 Including period PAT and dividend accrual
2
1Q24 Results
Key financial highlights
-
Core PAT +45% yoy drives 1Q24 attributable PAT to €358m, up by +38% yoy and +14% qoq
o NII above €600m off the 4Q23 peak, (-2.8% qoq), reflecting the impact from the hedging cost of carry and higher funding costs, partially absorbed by positive loan volume effects driving our PE loan NII higher qoq; NIM at 326bps, well above our FY24 guidance of <290bps
o Sustained fee income momentum (+15% yoy) following a seasonally strong 4Q23, driven by double-digit growth across retail products, especially in investment products and origination fees (>30% higher yoy); the number of customer transactions grew +13% yoy, on the back of e-banking channels up +26% yoy
o Continued cost discipline, with 1Q24 recurring operating expenses up by 3% yoy (like-for-like), reflecting the collectively agreed wage rises in December and normalized1 variable pay accruals, as well as abating inflationary pressures; 1Q24 C:CI below 30% against an FY24 target of <35%
o CoR at 55bps, well inside our <65bps guidance for FY24, with class leading coverage levels across Stages o Core RoTE at 17.6% in 1Q24 and 19.7% on attributable PAT, before adjusting for excess capital - NBG is the first Greek Bank to regain IG status since the Greek crisis outbreak of 2010
o MDBRS assigned an IG rating on NBG highlighting our strengthened balance sheet, core earnings power, sustained organic capital buildup, as well as strong funding and liquidity position
o PE loan expansion of +€1.1b yoy to €30.2b at the Group level; retail disbursements have gathered pace in 1Q24 reaching €0.4b, driven by SBs and consumer loans, offsetting repayments across the retail book (flat PEs qoq for the first time in many years)
o The approved not yet disbursed corporate pipeline post April currently stands at €2.9b, while April disbursements of €0.85b are already bouncing back from a seasonally weak 1Q24, boding well for our FY24 credit expansion target
o Exposure on fixed rate assets provides a natural hedge against the imminent ECB rate normalization
o Domestic deposits display seasonality as well as cash management optimization by corporates and the turn to asset management products; on a yoy basis, domestic deposits are up +€0.6b reflecting inflows from retail customers
o NBG is the first Bank to have repaid TLTRO exposure in 1Q24; net cash increased further to over €9b in 1Q24, mainly due to MREL issuances - Group NPE ratio at 3.7%, net NPEs at €0.2b
o Group NPE stock at €1.3b; NPE coverage at 86%, with Stage 2 coverage at 8% and Stage 3 coverage at 52% o Non-significantNPE flows in 1Q24 are well inside our FY24 guidance - CET12 at 18.6%, total capital ratio2 at 21.3%
o Strong profitability pushed CET1 ratio2 +c80bps higher qoq to 18.6%; total capital ratio2 at 21.3%, up by +c110bps qoq
o MREL ratio2 at 26.5%, 120bps above the Jan25 requirement of 25.3% - Our Transformation Program provides us with a competitive edge, supporting the rapid achievement of change
o We continue to enhance our revenue generation capacity through service model improvements, cross-selling, strategic partnerships, new business offerings, as well as significant changes to our technology infrastructure and our operating model, including the replacement of our Core Banking System
o Our continued efforts on digital upgrades keep delivering impressive results, with leading market shares in monthly active users (mobile: 32%, internet: 25%) and digital sales (cards: 41%, consumer: 32%, insurance: 55%), while digital sales surged to 1.3m units in 1Q24 from 0.9m units in 1Q23
o We further embed Climate & Environment considerations into targets, business strategy and risk management processes, further automating internal and external ESG reporting and launching flagship social initiatives, including on financial literacy and inclusion
1 Adjusting for the negative base effect from variable remuneration built up in 2H23 vs evenly over 2024 | 2 Including period PAT and dividend accrual
3
1Q24 Results
"Economic activity in Greece is gathering pace in the first months of 2024, displaying dynamism and resilience to geopolitical risks, with most key leading indicators on the rise; notably, labor market conditions are improving further, fixed capital investments show signs of strengthening, and credit demand is increasing.
Capitalizing on Greece's growth dynamics, NBG had a strong start to the year, demonstrating solid financial results across all key performance indicators, leveraging our strong balance sheet and decisive transformation. With a noteworthy resilience of core income, we generated an attributable PAT of c€360m in 1Q24, +38% higher yoy and +14% qoq, with the return on tangible equity reaching nearly 20% for the quarter (c18% on core PAT).
Our capital buffers were further enhanced, with CET1 and Total Capital ratios reaching 18.6% and 21.3%, up + 80bps qoq and +110bps qoq respectively --
after accumulating for dividend distribution-- demonstrating our continued strong organic capital generation. Our liquidity profile, deriving from the Bank's strong and stable core deposit base, remains robust, with 1Q24 excess cash increasing further to €9.1b, after fully repaying our TLTRO. Our asset quality remains solid, with non-significant NPE flows in 1Q24.
Our compelling financial performance, underpinned by sustained core profitability, coupled with our solid capital and liquidity profile, have allowed us to become the first Greek Bank to regain investment grade status.
Looking ahead, we remain steadfast in our commitment to foster the economy's expansion, supporting the growth initiatives of our customers, whilst delivering value to our shareholders. With a strategic focus on our technological transformation and with the loyal support of our people, we are continuing to work towards enhancing our customers' experience and future, as the Bank of First Choice."
Pavlos Mylonas
Chief Executive Officer, NBG
4
1Q24 Results
P&L | Group (€ m) | 1Q24 | 1Q23 | YoY | 4Q23 | QoQ | ||||||||||||||
NII | 606 | 497 | 22% | 623 | -3% | ||||||||||||||
Net fee & commission income | 100 | 87 | 15% | 109 | -9% | ||||||||||||||
Core Income | 705 | 584 | 21% | 732 | -4% | ||||||||||||||
Trading & other income | 60 | 50 | 19% | 30 | 99% | ||||||||||||||
Total Income | 765 | 634 | 21% | 762 | 0% | ||||||||||||||
Operating Expenses | (211) | (201) | 5% | (234) | -10% | ||||||||||||||
Core PPI | 494 | 383 | 29% | 499 | -1% | ||||||||||||||
PPI | 554 | 433 | 28% | 529 | 5% | ||||||||||||||
Loan & other Impairments | (55) | (65) | -15% | (66) | -17% | ||||||||||||||
Core Operating Profit | 439 | 318 | 38% | 433 | 2% | ||||||||||||||
Operating Profit | 499 | 369 | 35% | 463 | 8% | ||||||||||||||
Taxes | (119) | (98) | 21% | (88) | 36% | ||||||||||||||
Core PAT1 | 320 | 220 | 45% | 345 | -7% | ||||||||||||||
EPS (core PAT) | 1.40 | 0.96 | 45% | 1.51 | -7% | ||||||||||||||
Attributable PAT | 358 | 260 | 38% | 315 | 14% | ||||||||||||||
Balance Sheet | Group (€ m) | 1Q24 | 4Q23 | 3Q23 | 2Q23 | 1Q23 | ||||||||||||||
Total assets1 | 72,441 | 74,584 | 73,924 | 72,849 | 75,248 | ||||||||||||||
Gross loans | 34,404 | 35,306 | 36,419 | 36,404 | 36,780 | ||||||||||||||
Provisions (stock) | (1,070) | (1,083) | (1,100) | (1,428) | (1,494) | ||||||||||||||
Net loans2 | 33,334 | 34,223 | 35,319 | 34,976 | 35,287 | ||||||||||||||
Performing loans | 30,240 | 30,468 | 29,588 | 28,975 | 29,105 | ||||||||||||||
Securities3 | 17,477 | 17,201 | 15,712 | 15,832 | 15,144 | ||||||||||||||
Deposits | 55,608 | 57,126 | 56,292 | 55,671 | 54,775 | ||||||||||||||
Tangible equity | 7,417 | 7,102 | 6,763 | 6,553 | 6,292 |
1 Include held-for-sale assets of €0.3b I 2 Includes the reverse repo facility for the quarters of 2023, as well as senior notes amounting to €2.9b in 1Q24 | 3 Includes investment securities and financial assets at fair value through profit or loss
Key Ratios | Group | 1Q24 | 4Q23 | 3Q23 | 2Q23 | 1Q23 | ||||
Liquidity | |||||||||
L:D ratio | 60% | 58% | 57% | 57% | 58% | ||||
LCR | 249% | 262% | 252% | 254% | 269% | ||||
Profitability | |||||||||
NIM over average assets (bps) | 326 | 337 | 322 | 297 | 260 | ||||
C:CI ratio | 30% | 32% | 30% | 31% | 34% | ||||
CoR (bps) | 55 | 58 | 631 | 66 | 70 | ||||
Core PAT margin (bps) | 385 | 421 | 431 | 360 | 273 | ||||
Core RoTE (%) | 17.6% | 19.9% | 20.8% | 18.0% | 14.3% | ||||
Attributable RoTE (%) | 19.7% | 18.1% | 15.7% | 16.8% | 15.7% | ||||
Asset quality | |||||||||
NPE ratio | 3.7% | 3.7% | 3.7% | 5.4% | 5.2% | ||||
NPE coverage ratio | 86.1% | 87.5% | 93.1% | 82.1% | 87.6% | ||||
Capital | |||||||||
CAD ratio2 | 21.3% | 20.2% | 20.3% | 18.3% | 17.6% | ||||
CET1 ratio2 | 18.6% | 17.8% | 17.9% | 17.3% | 16.5% | ||||
RWAs2 (€ b) | 37.2 | 37.7 | 36.6 | 36.7 | 36.5 | ||||
1 Underlying | 2 Including period PAT and dividend accrual |
5
1Q24 Results
P&L | Greece (€ m) | 1Q24 | 1Q23 | YoY | 4Q23 | QoQ | ||||||||||||
NII | 578 | 474 | 22% | 594 | -3% | ||||||||||||
Net fee & commission income | 96 | 83 | 15% | 106 | -9% | ||||||||||||
Core Income | 673 | 557 | 21% | 700 | -4% | ||||||||||||
Trading & other income | 38 | 39 | -3% | 30 | 26% | ||||||||||||
Total Income | 711 | 596 | 19% | 730 | -3% | ||||||||||||
Operating Expenses | (197) | (189) | 5% | (220) | -10% | ||||||||||||
Core PPI | 476 | 369 | 29% | 480 | -1% | ||||||||||||
PPI | 514 | 408 | 26% | 510 | 1% | ||||||||||||
Loan & other Impairments | (44) | (57) | -22% | (65) | -32% | ||||||||||||
Core Operating Profit | 432 | 312 | 38% | 415 | 4% | ||||||||||||
Operating Profit | 470 | 351 | 34% | 445 | 6% | ||||||||||||
Taxes | (118) | (96) | 22% | (86) | 37% | ||||||||||||
Core PAT | 314 | 216 | 45% | 329 | -5% | ||||||||||||
Attributable PAT | 339 | 246 | 38% | 301 | 13% | ||||||||||||
P&L | International (€ m) | 1Q24 | 1Q23 | YoY | 4Q23 | QoQ | ||||||||||||
NII | 28 | 23 | 21% | 29 | -4% | ||||||||||||
Net fee & commission income | 4 | 3 | 15% | 4 | 11% | ||||||||||||
Core Income | 32 | 27 | 20% | 33 | -2% | ||||||||||||
Trading & other income | 22 | 11 | 98% | - | n/m | ||||||||||||
Total Income | 54 | 38 | 43% | 33 | 64% | ||||||||||||
Operating Expenses | (13) | (12) | 8% | (14) | -5% | ||||||||||||
Core PPI | 19 | 14 | 31% | 19 | -1% | ||||||||||||
PPI | 40 | 25 | 61% | 19 | >100% | ||||||||||||
Loan & other Impairments | (11) | (8) | 35% | (1) | >100% | ||||||||||||
Core Operating Profit | 8 | 6 | 26% | 18 | -57% | ||||||||||||
Operating Profit | 30 | 17 | 73% | 18 | 65% | ||||||||||||
Taxes | (2) | (2) | -32% | (2) | -17% | ||||||||||||
Core PAT | 6 | 4 | 59% | 16 | -61% | ||||||||||||
Attributable PAT | 19 | 14 | 35% | 14 | 39% | ||||||||||||
6
1Q24 Results
Profitability
Greece
Higher core income (+21% yoy), a low single-digit increase in operating expenses on a like-for-like basis (+3% yoy), and a measured CoR normalization drove core PAT +45% higher yoy to €314m in 1Q24. As a result, attributable PAT amounted to €339m, exhibiting a +38% yoy and +13% qoq increase, boding well for FY24 profitability target attainment.
NII increased by +22% yoy to €578m in 1Q24, reflecting positive rate effects, a healthy PE expansion of +€1.1b yoy in Greece, as well as an increased contribution from securities, driving NIM higher to 321bps. On a quarterly basis, NII settled 2.8% lower compared to its peak in 4Q23, due to the impact from the hedging cost of carry and higher wholesale funding costs, partially absorbed by positive loan volume effects.
Net fee and commission income increased by +15% yoy to €96m in 1Q24 following a seasonally strong 4Q23. Main contributors to this compelling performance were retail fees, with double digit growth across products. The most notable movements were witnessed in investment products (+38% yoy), driven by increased bancassurance and mutual funds volumes, along with corporate bond issuances, as well as lending fees (+30% yoy). Importantly, our digital transformation continued unabated producing impressive results, with e-banking transactions up by +26% yoy in 1Q24, driving the total number of customer transactions +13% higher yoy.
Operating expenses increased by +3% yoy on a like-for-like basis to €197m in 1Q24, supporting a C:CI of 29.3% (31.4% in 4Q23). The increase in costs reflects the collectively agreed wage rises in December and normalized1 variable pay accruals, as well as abating inflationary pressures.
Loan impairments normalized further to €38m in 1Q24, with provisioning rate dropping below the 50bps mark, at 47bps over net loans. Our sector low CoR is a function of non-significant NPE formation in the quarter and our class leading coverage levels across stages.
Domestic NII breakdown (€ m)
Domestic operating profit (€ b) | 1Q23
563 | 594 | 578 | ||||
529 | ||||||
474 | ||||||
Loans | 443 | 450 | ||||
(PE) | 429 | |||||
414 | ||||||
Loans | 367 | |||||
(NPE) | ||||||
20 | 20 | 18 | ||||
Securities, | 23 | |||||
19 | ||||||
funding & other | 194 | 187 | ||||
114 | 133 | 166 | ||||
Non core income
Core PPI
351
39
369
445
30
480
470
38
476 | Core PPI |
+29% yoy |
Deposits | ||||||||
-25 | -41 | -52 | -63 | -77 | ||||
1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 |
CoR
Other impairments
-48 | -46 | -38 |
-8 | -19 | -7 |
1Q23 4Q23 1Q24
International
In International operations, 1Q24 attributable PAT increased by 35% yoy to €19m, reflecting higher NII (+21% yoy), strong fees (+15% yoy), as well as higher trading and other income (€22m in 1Q24 from €11m in 1Q23).
1 Adjusting for the negative base effect from variable remuneration built up in 2H23 vs evenly over 2024 | 2 Including period PAT and dividend accrual
7
1Q24 Results
Asset Quality
Group NPE stock remained flat qoq at €1.3b in 1Q24, or €0.2b net of provisions, with non-significant organic formation in the quarter, well inside our FY24 guidance.
Group NPE ratio stood at 3.7%, with NPE coverage of 86%. International NPE ratio declined to 4.3%, with coverage settling at 103%.
NPE ratios and coverage | 1Q24 | Group NPE stock evolution (€ b) |
Collateral | 74% | 66% | 70% | |
coverage1 | ||||
NPE ratio | 5.1% | |||
3.7% | 3.7% | |||
3.1% | ||||
NPE | 75% | |||
coverage2 | 92% | 85% | 86% | |
Retail | Corporate | Total | Total Group | |
Domestic |
NPE ratio | 5.2% | 5.4% | 3,7% | 3.7% | 3.7% |
1.8 | 1.8 | |||||||
International NPEs | 0.1 | 0.1 | 1.3 | 1.3 | 1.3 | |||
0.5 | 0.6 | |||||||
0.1 | 0.1 | |||||||
Domestic FNPES <30 | 0.2 | 0.1 | ||||||
0.2 | 0.4 | |||||||
dpd | 0.5 | 0.6 | ||||||
Domestic FNPEs >30 | 1.0 | 0.1 | 0.2 | 0.2 | ||||
0.9 | ||||||||
dpd & other impaired | 0.5 | 0.5 | 0.6 | |||||
Domestic 90+dpd | ||||||||
1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | ||||
1 Collateral coverage at the Bank level | 2 NPE coverage incorporates additional haircuts on the market value of collateral
Domestic NPE stock per category (€ b) | 1Q24 | Domestic forborne stock (€ b) | 1Q24 |
o/w: €0.3b or | |||||||
c40% <30dpd | |||||||
o/w: €0.1b or | FNPEs <30 dpd | ||||||
c50% <30dpd | |||||||
0.4 | |||||||
0.9 | |||||||
0.7 | 1.8 | FNPEs 31-90dpd | |||||
FPEs 1.2 | |||||||
0.4 | 0.1 | ||||||
0.3 | 0.1 | 0.2 | 0.1 | FNPEs >90dpd | |||
0.1 | 0.1 | ||||||
1Q23 1Q24 | 1Q23 1Q24 | 1Q23 1Q24 | 1Q23 1Q24 | ||||
Mortgage | Consumer | SBLs | Corporate |
8
1Q24 Results
Capital Adequacy
Strong organic profitability pushed CET1 ratio2 +c80bps higher qoq to 18.6%. Total capital ratio2 settled at 21.3%, +c110bps higher qoq. Our MREL ratio2 reached 26.5%, exceeding the Jan25 requirement of 25.3% by 120bps.
1Q24 capital2 movement
20.2%
CAD
CET1 | 17.8% |
+c1.0%+c0.0%
-c0.2%
21.3%
18.6%
RWAs: €37.7b
RWAs: €37.2b
4Q23 CET1 | 1Q24 PAT | RWAs | Other | 1Q24 CET1 |
(incl. DTC amortization) |
Liquidity
Seasonally lower corporate deposits as well as cash management optimization by corporates and the turn to asset management products pushed domestic deposit balances to €53.6b in Mar24, -€1.5b lower qoq. Importantly, deposit mix remains best in class, as time deposits represent just 19% of total deposits. Compared to Mar23, domestic deposits increased by +€0.6b yoy, reflecting inflows from retail customers, with international deposits also up by +€0.2b yoy to €2.0b. As a result, Group deposits amounted to €55.6b in Mar24, +€0.8b higher yoy, comprising c95% of NBG's total net funding.
Our liquidity profile remains robust, manifested by our LCR of 249%, the highest in Greece and among the highest in the Euro area, our class-leadingnet cash position of €9.1b, c€1.1b higher qoq, on zero TLTRO exposure as of Mar24, as well as a L:D ratio of 60% at the Group level (59% in Greece).
TLTRO III, cash & reserves and net interbank (€ b)
Group deposit evolution (€ b)
TLTRO III
Cash & reserves | NBG is a net lender in | TLTRO fully | |||||
Net interbank | |||||||
the interbank market | repaid in 1Q24 | ||||||
8.0 | 9.1 | ||||||
9.9 | |||||||
9.0 | 8.3 | ||||||
54.8
1.8
53.0
8.4
8.8
5.6
55.7
1.9
53.8
9.6
8.6
5.9
56.3
1.9
54.4
10.2
8.4
6.3
57.1
2.0
55.1
10.5
8.3
6.2
55.6
2.0
53.6
10.2
7.6
6.1
Group
Intr'l
Greece
Time
Sight & other - Corporate
5.0 | |||||||||||||||
0.8 | 1.9 | 0.8 | 0.8 | ||||||||||||
0.0 | |||||||||||||||
1Q23 | 4Q23 | 1Q24 |
30.2 | 29.7 | 29.6 | 30.0 | 29.7 |
1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 |
Sight & other - Retail
Savings
2 Including period PAT and dividend accrual
9
1Q24 Results
ESMA Alternative Performance Measures (APMs), definition of financial data and ratios used
The 1Q24 Financial Results Press Release contains financial information and measures as derived from the Group financial statements for the period ended 31 March 2024 and for the year ended 31 December 2023, which have been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting" and International Financial Reporting Standards ("IFRSs"), as endorsed by the EU respectively. Additionally, it contains financial data which is compiled as a normal part of our financial reporting and management information systems. For instance, financial items are categorized as foreign or domestic on the basis of the jurisdiction of organization of the individual Group entity whose separate financial statements record such items.
Moreover, it contains references to certain measures which are not defined under IFRS, including "pre-provision income" ("PPI"), "net interest margin" and others, as defined below. These are non-IFRS financial measures. A non-IFRS financial measure is one that measures historical or future financial performance, financial position or cash flows but which excludes or includes amounts that would not be so adjusted in the most comparable IFRS measure. The Group believes that the non-IFRS financial measures it presents allow a more meaningful analysis of the Group's financial condition and results of operations. However, the non-IFRS financial measures presented are not a substitute for IFRS measures.
10
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National Bank of Greece SA published this content on 01 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 02 May 2024 09:35:45 UTC.