Piraeus Bank is planning a high shareholder reward, as the bank's CEO, Christos Megalou, told analysts. With a mix of cash and share buybacks, a dividend of more than €350 million from 2024 earnings is planned. In particular, the new dividend targets call for a 35% distribution rate from 2024 earnings, compared to an initial estimate of 25%. For 2025, the distribution rate will be 50%, while management's intention is to distribute the dividend earlier.  

DEFERRED TAX

The analyst briefing was dominated, as BnB Daily had already informed you, by the issue of deferred tax. As the management pointed out, the DTC amount is €3.2 billion, and with a linear depreciation of about €200 million per year, it will reach zero in 2041. "However, we are accelerating, with a supervisory provision of €150 million per year, i.e., a total of €350 million, in order to reach zero in 2034."  The bank's CFO, Theodoros Gnardellis, stressed that "this is the last vestige of the crisis" and added that this plan "is being implemented by Piraeus Bank without the green light from the SMM, as it is the institution that is responsible for compliance, not responsible for drawing up the business plan." 

GOALS

Mr. Megalou also referred to the new goals of Piraeus Bank. Specifically for this year:

• Earnings per EPS share above €0.90
• Return on capital on tangible book value above 17%
• Revenue to assets around 2.7%
• Cost to core revenue around 30%
• Operating risk costs around 0.60%
• Red loans below 3% - Red loan coverage at 60-65% - Healthy loan portfolio around €33bn. with annual growth of about 10% - CET1 capital ratio of 15%
• Total capital ratio of about 20% with annual growth of 220 basis points - Estimated ECB deposit rate on the basis of which the above 3% from initial estimate of 3.75%

ACQUISITIONS

The response of the bank's management to a question about possible acquisitions was surprising. The management stressed that the areas of interest to the bank are asset management and leasing, with synergies within the euro zone being considered. In the nine-month period, the bank recorded a credit expansion of €1.9 billion, beating the performance and the 2023 target (€1.6 billion). Of the €2.8 billion of disbursements in the third quarter, around €1.3 billion was channelled to small, medium-sized enterprises and individuals, and €1.3 billion to large enterprises.  As regards the Recovery Fund, Piraeus loans amount to €1.5 billion, of which €600 million have been contracted