The CEOs of systemic banks presented their business plans and their objectives to the investment community during the Morgan Stanley roadshow. The shared message was that the domestic banking system has made significant progress and is now optimistic about the future, armed with a well-defined plan for the upcoming day. Dividends, profitability, faster amortization of deferred taxes, and credit expansion are some of the areas that caught the attention of investors.
EUROBANK PLANS
Fokion Karavias, the CEO of Eurobank, emphasized the importance of mortgage loans and the prerequisites for their successful launch. As he explained, mortgage loans are not yet moving sufficiently as there is a housing supply problem. In Attica, many of the old properties remain closed, and there are not enough new ones to meet the existing demand for housing. When questioned about the potential for a special tax, Mr. Karavias reaffirmed the Prime Minister's denials.
EXPANSION ABROAD
According to statements made in London, Eurobank's strength lies in its growth abroad. As Mr. Karavias said, 100% of the Greek Bank in Cyprus will offer significant synergies. In 2024, loans in Greece and abroad will reach €3.5 billion. Mr. Karavias announced a review of the banks' business plans early in the new year, based on the results of the second quarter of 2024.
ACCELERATING DIGITAL TRANSFORMATION
In addition to growth, increased dividends, and growth prospects, National Bank CEO Pavlos Mylonas spoke about the need for digital transformation in the banking industry. He mentioned artificial intelligence and the investments the bank is making in this area, as well as the new cloud-based information technology system of Ethniki that will be ready in a year. "The aim is to use technology to reduce costs and improve the customer experience," he said.
PIREAUS BANK
The position that Piraeus' strategic priority is to increase lending to the Greek economy, promoting sustainable growth and diversifying revenue sources for the bank, the group's CEO, Christos Megalou, expressed from London. Piraeus expects loan growth of 10% in 2024, driven by strong demand for business loans, €2.1 billion in net interest income (NII), and a net interest margin (NIM) of 2.7%, which is one of the highest in the EU. They have been able to keep loan margins and cost of deposits the same.
CREDIT EXPANSION
Moreover, referring to Piraeus Bank's credit expansion and net interest margin (NIM), he pointed out that "maintaining NIM is important with a cycle of interest rate cuts and consensus for a 2% or even lower ECB rate by the end of 2025. For 2025, the goal is to continue to grow our loan portfolio, leveraging strong demand from corporations as well as the funds coming from the RRF, while working hard to revive retail operations. Piraeus anticipates the creation of opportunities in SMEs and retail, among other factors, to offset the pressure on NIM.
THE ROLE OF ASSET MANAGEMENT
Asset management will replace the reduction in interest income in the context of falling interest rates, as noted by Alpha Bank CEO Vassilis Psaltis. "The penetration of these financial products in Greece is still at a relatively low level compared to countries such as Portugal and the EU average, but several factors are driving a change. Greeks have historically relied heavily on health services and pensions provided by the state, but recent reforms have created space for the development of the private insurance sector," Psaltis said.
