piraeus bank group

Piraeus Bank Group, FY2018 Financial Results: Α Step Forward in Restoring Profitability

Solid Operating Performance, Driven by Cost Efficiency and Cost of Risk Normalisation

  • Pre Tax Profit of €80mn for the year, reversing a period of annual losses.
  • Pre Provision Income of €851mn of recurring nature sets the base forward.
  • New Loan Disbursements of €3.1bn in FY.2018.
  • Net Fees in all business line segments of the Bank displayed positive growth.
  • Operating Cost reduction exceeded targets, down by 8% yoy in FY.2018 (recurring base).
  • Cost of Risk improved to 157bps in FY.2018 vs 479bps in FY.2017.

Balance Sheet Repair, Organic Trends Encouraging

  • Significant NPE reduction over the past year (-€5.5bn).
  • Default rate falling and cure rate improving.
  • Completion of two NPE portfolio sales of €1.8bn aggregated gross book value.
  • Two new NPE sales projects under way of €1.3bn gross book value.
  • Cash coverage of NPLs at 77%, NPE cash coverage ratio at 49% (while adding collateral total coverage increases to c.100%).
  • Conclusion of international divestments in line with the 2015 Restructuring Plan.
  • New updated NPE target for YE 2021 is set at €11bn, reflecting a decrease of €15bn vs Dec.2018 level.

Enhanced Liquidity Profile and Funding Mix, Underpins Healthy Loan Growth

  • Deposits in Greece up by €3.6bn yoy.
  • Zero ELA reliance since mid-July 2018.
  • Gradual shift of covered bonds to zero cost ECB funding from interbank repo utilisation.
  • Net loan-to-deposit ratio down to 85% vs. 103% a year ago.
  • On track to meet LCR target, at 61% in Dec.2018.

Progress in Executing Capital Enhancement Plan

  • 94% of the internal capital generating actions, have been concluded.
  • CET-1 ratio at 14.0% in Dec.2018, pro-forma for asset disposals.
  • 2019 SREP Pillar 2 Requirement reduced by 50bps, a testament to progress achieved.

Athens, March 29, 2019