National Bank records strong performance in all sectors in Q1 2024.

Group organic profit after tax increased by +45% on an annual basis, with an increase of 1.43% in the first quarter, leading to an increase in attributable profit after tax to €358 million, up +38% on an annual and +14% on a quarterly basis.

Net interest income remained above €600 million, -2.8% quarter-on-quarter, compared to a historically high Q4 2023,reflecting the impact of hedging costs and higher funding costs partially absorbed by the positive impact of the increase in average loan balances, which drove net interest income on performing loans higher quarter-on-quarter. Net interest margin was 326bps, well above the <290bps estimate for 2024.

Commission income momentum was sustained (+15% y/y) after a seasonally strong Q4 2023, reflecting double-digit growth across all sub-categories of Retail commissions, particularly in commissions from investment products and lending, where growth exceeded +30% y/y. The number of transactions increased by +13% year-on-year, as a result of a +26% year-on-year increase in transactions on digital channels.

Cost containment continued, with recurring operating expenses increasing 3% year-on-year in Q1 2024, reflecting December's industry-wide wage increases and normalized1 variable pay, as well as inflationary, but declining, pay increases. The cost to organic revenue ratio was below 30% against a target of <35% for 2024

Cost of credit risk was at 55bp, significantly lower than our target of <65bp for 2024, reflecting the high NPE coverage rates across all portfolios (Stages 1, 2, 3).

The return on equity ratio was 17.6% at the organic profit after tax level and 19.7% at the attributable profit after tax level, without adjusting for excess CET1 capital above regulatory limits.

CEO MESSAGE 

Commenting on the financial results, National Bank CEO Pavlos Mylonas said: "Economic activity in Greece accelerated in the first months of 2024, showing increased momentum and resilience against geopolitical risks, with key economic indicators on an upward trajectory. Indicatively, labour market conditions are further improving, inflation is easing, fixed capital investment is showing signs of acceleration, while demand for bank lending is increasing.

Capitalising on Greece's growth momentum, the National Bank of Greece started the year by recording strong financial results across all its business areas, benefiting from its strong balance sheet strengths and its decisive transformation. Demonstrating remarkable resilience in our organic revenues, profit after tax attributable to shareholders reached €360 million in 1Q2024, up +38% year-on-year and +14% quarter-on-quarter, with return on tangible equity approaching 20% for the current quarter (around 18% in terms of organic profit after tax).

Our capital buffers were further strengthened, with the CET1 ratio at 18.6% and the Total Capital Adequacy Ratio at 21.3%, up +80m b.p. and +110bps on a quarterly basis - including provision for dividend distribution - reflecting continued strong organic capital generation.

The Bank's liquidity profile resulting from the large and stable base of demand and savings deposits remains strong, with net cash increasing further to €9.1 billion in Q1 2024, following the repayment of the Long-Term Refinancing Transaction Programme (TLTRO).

The quality of the loan portfolio remains high, with negligible NPL flows in Q1 2024. Our impressive financial performance, with a focus on maintaining high organic profitability, combined with our strong capital position and high liquidity, allowed us to become the first Greek bank to regain investment grade status since the financial crisis in Greece in 2010. Looking to the future, we remain true to our commitment to support the growth of the economy and our clients' growth initiatives, while adding value to our shareholders. With a strategic focus on our technological and digital transformation and with the unwavering support of our people, we continue to work towards enhancing our customers' experience and prospects as the Bank of First Choice."