Greek Banks Post Robust Profit Growth, Upgraded Forecasts

08:49 12/8/2024 - Πηγή: iEfimerida

Greek banks are riding a wave of success in the first half of 2024, exceeding initial expectations and prompting an upward revision of their annual profit forecasts.

The industry is now anticipating a combined net profit of approximately €4.5 billion for the year, driven by robust performance in key areas.

Resilient

Performance

A report by Morningstar DBRS points to several factors behind this better-than-expected performance. Strong net interest margins, fueled by slower interest rate declines, an improved deposit mix, and increased credit expansion, have contributed to the banks' robust results.

Strong Profits

The four major systemic banks (Eurobank, National Bank of Greece, Alpha Bank, and Piraeus Bank) collectively reported profits of €2.3 billion in the first half of 2024, a significant 25% year-over-year increase.

Key Metrics

Interest income for the sector surged, reaching €4.197 billion. Fee income also saw a notable increase, totaling €1.010 billion. Asset quality improved significantly, with the average gross non-performing exposures (NPEs) ratio falling to 3.5% by the end of June 2024.

Positive Outlook

Analysts from DBRS note that higher net interest and fee income, coupled with effective cost management, have contributed to the positive results. Risk costs have also decreased, further improving the risk profile of Greek banks.

NBG Securities highlighted the strong second quarter performance, driven by higher loan disbursements, robust fee income, and reduced trading income.

Conclusion

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