Piraeus Bank announced today net profits of 800 million euros in 2023 and credit expansion of 1.6 billion euros.

As announced, customer deposits continue to grow, reaching €59.6 billion at the end of December 2023, up 2% both year-on-year and quarter-on-quarter. Overall, the Group’s diversified and stable deposit structure is a key advantage, with broad retail base deposits making up 51% of the total deposit base, it noted.

NPEs (non-performing exposures) fell to 1.3 billion euros at the end of December 2023, compared to 2.6 billion euros a year ago. The decrease came from the front-loaded and accelerated NPE liquidation transactions, but also from the positive results of the organic effort. Accordingly, the NPE ratio fell to 3.5%, from 5.5% in the previous quarter, and 6.8% a year ago.

As the president of Piraeus Bank Giorgos Khandzinikolaou pointed out: “In 2023, the global economy moved steadily amid a challenging macroeconomic environment with geopolitical turbulence, which was caused by the conflict in the Middle East and the ongoing impact of the invasion of Ukraine. However, with energy prices decelerating, supply chains normalizing in Europe and the latest coronavirus restrictions being lifted, the economic environment has shown resilience.

The Greek economy continued to grow, mainly due to increased international and domestic investment, strong tourism, strong exports and the implementation of the Recovery and Resilience Plan, as Greece has committed resources equivalent to 17% of its GDP in grants and loans, of which 41% have already been disbursed. In addition, the upgrade of the Hellenic Republic’s credit rating to investment grade, after more than a decade, the prudent fiscal policy and the declining fiscal deficit, as well as the consistent implementation of structural reforms, have created a favorable environment for attracting foreign investment .

As the Bank with the largest footprint in the Greek economy, Piraeus Bank has benefited from the positive economic environment, continuing to create value for the economy and society as a whole. Armored with strong liquidity, a robust balance sheet and adequate capital reserves, Piraeus Bank is ready to finance our country’s path towards sustainable development and create value for its shareholders.

In this context, 2023 was a pivotal year, with the implementation of initiatives such as the measures to support flood-affected Thessaly, the developments in digital banking with an emphasis on new payment and financing functionalities for our customers, the development of the new model of our stores focusing innovation and seamless service, and the creation of synergies with Greek organizations within the social responsibility initiatives of the Piraeus EQUALL program.

Above all, Piraeus Bank will continue to transform, incorporating all the latest developments in digital technology and beyond, with the aim of safeguarding the interests of its employees, customers and investors.”

Piraeus Bank CEO Christos Megalou states: “The Greek economy maintained its growth momentum in 2023, with GDP growth estimated at around 2.5%, significantly exceeding the Eurozone average. The main growth drivers are the utilization of the Recovery and Resilience Fund, the improvement of the labor market and the inflow of foreign investments. In 2023, the Greek republic regained the investment grade, marking another milestone for the country and the banking sector, while the possible upgrade of Greece to developed market status will be another catalyst in the convergence process with the corresponding European economies.

Piraeus delivered its strongest set of financial results on record in the 4th quarter, generating Euro0.25 earnings per share and a 20% return on equity, driving the corresponding 2023 annual figures to Euro0.80 and 17%. Piraeus Group continued to improve all key financial indicators, with an emphasis on sustainable profitability taking into account the risks assumed, and the accumulation of supervisory capital, through the diversification of revenue sources, discipline in operating costs and careful management of credit risk. Our strategy to strengthen fees is paying off, as we increased net fee income to assets to 74 basis points for the year 2023, while our pursuit of further operational efficiencies drove the cost-to-core income ratio to 31%, the historically lowest on an annual basis.

Accelerating organic capital generation drove the CET1 ratio to 13.3%, up 1.7 percentage points year-on-year, while also incorporating provision for a dividend distribution to shareholders. The NPL ratio fell to 3.5%, while the Group’s loan portfolio grew by 5% year-on-year, leveraging our leadership in the management of the Recovery and Resilience Fund resources.

Building on its 2023 performance, Piraeus today announces its new financial targets for 2024-26. Key points include recurring net profitability of around €1 billion per year, further increase in CET1 ratio to around 15% in 2026, rise in current loans of at least 5% per year and NPL ratio of around 2.5% in 2026. Also , marking the transition to a new era for the Group, we now aim for a 50% profit distribution rate from 2025 onwards, subject to the fulfillment of the necessary conditions. We continue to raise the bar of our pursuits and be committed to creating value for the benefit of our shareholders, while offering continuous support to our customers and the wider Greek economy.”