National Bank Of Greece Stock

Ladies and gentlemen, thank you for standing by. I am Maria, your Chorus Call operator. Welcome, and thank you for joining the National Bank of Greece conference call to present and discuss the second quarter 2026 financial results.

At this time, I would like to turn the conference over to Mr. Pavlos Mylonas, CEO of National Bank of Greece. Mr. Mylonas, you may now proceed.

Good afternoon, everyone, and good morning for those joining from the U.S. Welcome to our second quarter 2026 financial results call. I'm joined by Christos Christodoulou, the Group CFO; and Greg Papagloorres, Group Head of IR. After my introductory remarks, Christa will go into more detail on our financial performance, and then we will turn to Q&A.

So let's begin. On the macro front, we continue to navigate an environment of elevated volatility, yet both the Greek economy and the banking sector have demonstrated remarkable resilience, consistently revealing a capacity to adopt and create value during a highly challenging external backdrop. Recall that at the beginning of the year, the base case scenario envisaged a gradual normalization of the geopolitical environment from midyear, a date already passed.

In fact, the second quarter once again exceeded expectations, particularly the corporate sector, while the fundamental drivers underpinning Greece's growth trajectory remained intact to just -- to mention just a few important ones. Business activity continued on a solid upward trend as evidenced by record gross operating surplus levels, high capacity utilization rates, a strong business investment appetite, and this positive outlook is set to continue as per our PMI of 54.

Tourism continues to outperform and remains on course for another record year. Labor market conditions strengthened in May, June with unemployment declining to an 18-year low and real wages are set to record positive growth for a third consecutive year. The Greek private sector also continues to benefit from supportive financing conditions. Credit expansion remained robust and capital raising in the domestic capital market reached a new record level through July, underscoring both the strong demand for fixed investment as well as sustained investor appetite for Greek assets.

Greece's fiscal position continues to serve as a key pillar of resilience. Following the record primary surplus achieved in 2025, fiscal outperformance continued in early 2026. Consequently, Greece remains one of the few European economies with meaningful fiscal space, providing an important buffer against a prolonged period of heightened external uncertainty and reinforcing confidence in the country's medium-term outlook. This fiscal capacity has already begun to be deployed to mitigate external headwinds. Targeted support measures introduced so far this year reached EUR 1 billion, among the highest in the euro area relative to GDP.

Moreover, more measures are expected to be announced at the time of the Siki fair in September. Looking ahead, investment remains the central pillar of Greece's growth outlook. As the country enters the final stage of RRF implementation, more than EUR 20 billion of available resources remain to be deployed during the second half of 2026 and a couple of years beyond. Combined with a mature pipeline of additional private sector investments already underway, these resources are expected to continue supporting fixed capital formation, productivity growth and the ongoing transformation of the Greek economy.

For the banking sector, the macroeconomic backdrop remains particularly supportive. Strong investment momentum, healthy corporate balance sheets, improving labor market fundamentals and ample liquidity continue to underpin credit expansion, support asset quality and drive increasing demand for more sophisticated banking transaction and advisory services. Consequently, we remain confident that the Greek economy is well positioned to navigate heightened uncertainty, creating favorable conditions for sustainable lending growth and long-term value creation. Now let me turn to our financial results.

The strength of the Greek economy, combined with our comparative advantage and disciplined execution has enabled the delivery of another solid set of results in the first half of the year. Our results are comfortably fulfilling the full year 2026 guidance issued in February, leading us to upgrade multiple 2026 full year targets. Specifically, in the first half, we delivered a profit after tax of EUR 661 million, which implied an earnings per share of EUR 1.45, 3% higher relative to 2025's first half comparable levels.

Our return on tangible equity reached 15.5% or over 20% adjusted for excess capital, leading us to revise our full year 2026 target to over 15%. The key driver in the second quarter has been the strong momentum in our core income generation, underpinned by the strong performance of both our NII and fee lines. Regarding NII, it increased by nearly 3% quarter-on-quarter in the second quarter of 2026, notably stronger than the previous quarter on the back of solid performing loan expansion and a positive trajectory in benchmark rates.

Importantly, NIM has pivoted from the first quarter '26 lows standing at 273 basis points. The current rate trajectory allows us to revise upwards our NII expectation from a low single digit to a mid-single-digit growth rate for the full year 2026 on a year-on-year basis as well as our NIM to circa 280 basis points. With regards to credit expansion, both corporate and retail disbursements accelerated in the second quarter despite geopolitical uncertainty, leading our performing loans to expand by over $2 billion year-to-date, a growth of 13% year-on-year.

Corporate credit, up by 17%, continues to be the key driver with credit demand focusing on large corporates, SMEs and project finance across key sectors, namely energy, infrastructure and shipping, supported also by the approval acceleration linked to RRF that Lance brought forward. Retail performing loans, up 4% year-on-year, continued contributing positively to credit growth with disbursements coming in higher by 20% year-on-year across all segments, resulting in notable market share gains. Turning to commissions.

Our fee income growth picked up in the second quarter, yielding a double-digit growth for the first half of the year, 10% on the back of retail fees fueled by continued strong sales of investment products. Indeed, these led to a 0.5% gain in market share year-to-date despite the market turbulence. The other driver was corporate fees from new originations. Our strong first half performance provides confidence for comfortably achieving our high single-digit full year 2026 guidance.

As regards to costs, we have remained disciplined in our commitment to invest in our people through the onboarding of new talent, higher wages as well as variable pay linked to productivity improvements. In the same direction, our multiyear investments in technology and digital infrastructure provide us with many competitive advantages as regards to commercial effectiveness, digital offerings and cybersecurity.

Notably, we recently completed the largest banking technology project ever undertaken in Greece, the replacement of our core banking system. This 5-year landmark project has been a strategic move that facilitates the bank's transition into the new technological era we are facing by providing modularity for ease of integration and extra functionality, for example, virtual accounts, operative accounts, liquidity management; two, agile product parameterization for faster time to market; three, open architecture to facilitate the delivery of our digital strategy for Banking-as-a-Service; four, cloud-native architecture permitting easy shifts to cloud, which will be the best practice in the future; and five, headroom for a 30% increase in the already market-leading transaction levels, absorbing future growth without the need for replatforming.

Plus the core banking system acts as a cornerstone for our AI strategy. More on that later. It's an appropriate moment to remind you that our early investment in technology has allowed us to: one, renew 80% of our systems, reducing their average age to below 6 years; two, to create a market-leading embedded banking business due to our APIs capabilities as well as bespoke APIs for large corporate customers' payment needs; three, -- last and not least, to totally revamp our digital offering with 3 new mobile apps, 2 new websites and a new youth platform, leading to a market-leading overall number of digitally active customers.

Furthermore, the bank has fully embraced AI usage, where our use cases already span across front, middle and back offices. We have leveraged AI capabilities in many areas, such as the support of corporate business lending underwriting, AML fraud prevention and the creation of an internal knowledge management platform, Athena, to name just a few. We were also the first bank that rolled out a customer-facing agent, our digital assistant Sofia, with our rapidly growing services she offers expanding across all our digital channels, servicing already 200,000 requests per month, i.e., approximately 25 of total requests, a number that's growing. Moreover, we recently added in July a real-time voice capability via in our contact center, already servicing approximately an additional 130,000 calls per month.

These innovative steps open the door to a wealth of new functionalities and opportunities for the bank, putting us at the forefront of European financial services in terms of technology stack and the application of its capabilities. These efforts also provide structural protection and operational resilience in a more challenging world with IA-led cyber risks.

Our capital position remains strong with our CET1 ratio at 17.3%, absorbing the sharp increase in performing loans during the first half of the year, especially in the second quarter as well as superior payout accruals. As regard to capital strategy, our robust capital position, one of NBG's key competitive advantages, provides security during uncertain times while supporting organic growth and superior shareholder returns, which remain our priorities. Importantly, our capital resources offer strategic optionality for growth and value creation for our shareholders.

As you may recall, in the previous quarter, we announced a major step toward enhancing our fee-generating capabilities, forming a partnership with a leading global insurer Allianz. This partnership aims to enhance our offerings of customer-centric insurance solutions while maintaining a capital-light model, thus contributing to sustainable earnings growth and long-term value creation to our shareholders. In the same direction, we are currently proceeding with another strategic transaction, partnering with Rromaz Capital to capitalize on selected real estate investment opportunities.

Our initial investment will be in the area of $400 million, opting to achieve recurring income generation while diversing further our fee structure. The partnership is anticipated to provide a substantial uplift to group fees by circa 3 percentage points during '27, '28 and is our return on tangible equity accretive by over 20 basis points. To close, it is important to reiterate that our strategic priority for growth remains firm to enhance shareholder value by increasing our revenue base on a sustainable basis and in the event of inorganic growth to create tangible value.

With that, I would like to pass the floor to our group CFO, Christos, who will provide additional insights to our financial performance before we return to Q&A. Christos?

Thank you, Pavlos. The first half of 2026 was another period of strong execution for ABG. We delivered robust profitability, accelerated core income growth and also strengthened the foundations for future earnings growth. As illustrated on Slide 21, in H1, we generated a profit after tax of EUR 661 million before one-offs, supported by increased NII momentum and accelerated fee growth.

This translates into a return on tangible equity of 15.7% or 15.5% normalized for the first half trading gains, comfortably above our initial full year '26 guidance of circa 15%, which now we revised upwards to over 15% Importantly, adjusting for excess capital, return on tangible equity exceeds 20%, showcasing the significant upside potential embedded in our balance sheet, which is being released as we progressively deploy our capital resources.

As regards to our earnings per share, we generated an EPS of EUR 1.45 in H1 that led us to upgrade our full year guidance to over EUR 1.4 per share. Going into more detail, our NII momentum strengthened further during the second quarter, increasing by 3% quarter-on-quarter, as shown on Slide 25, primarily driven by volume effects as market rate impact is mostly expected in the second half of the year, given the repricing lag in our loan portfolio.

Performing exposures grew by an impressive EUR 2.1 billion year-to-date, which combined with the improving rate dynamics in the latter part of the second quarter will support NII going forward. Importantly, Q2 marked a turning point for our net interest margin, pivoting from the Q1 trough. Looking ahead, the combination of higher rates and sustained credit dynamics underpins our expectation for a strong second half of the year, leading us to upgrade our full year NII guidance from a low to a mid-single-digit growth.

While NII and net interest margin remain key strengths, fee income is increasingly becoming a powerful growth engine. Our fees gained significant traction in Q2, up by 14% quarter-on-quarter, resulting in a 10% year-on-year growth for the 6-month result with momentum across core businesses, as shown on Slide 32. Retail banking is up by 14% year-on-year, led by investment products, which grew by almost 50% year-on-year on the back of strong cross-selling, leveraging our deposit franchise as we continue to benefit as clients move balances from term deposits into fee-generating investment products, supporting our market share gains in mutual funds.

This trend allowed us for a 50 basis points year-to-date increase in market share in mutual funds, while retail funds under management grew to EUR 10.6 billion in Q2, up by 14% or EUR 1.3 billion year-to-date as illustrated on Slide 33. At the same time, corporate fees also delivered double-digit growth, supported by a 20% year-on-year increase in loan origination fees, also capitalizing a very strong finish in RRF-related contracts.

Beyond the strong underlying momentum, we continue to make tangible progress in building a more diversified core revenue base, focusing on scaling up our fee-based income generation, which will materially support our income growth from 2027 onwards as disclosed in Slides 15 and 16. The Allianz transaction represents a strategically important step in this direction, strengthening our insurance proposition through innovative product capabilities and elevated customer experience.

Along the same lines, the recent agreement with Rome Capital broadens our recurring income opportunities through a disciplined and highly selective real estate investment platform, further enhancing the resilience and diversification of our earnings profile. Both transactions create substantial value, delivering a significant uplift to both our EPS and return on tangible equity and exemplify the type of strategic transactions we seek to pursue. -- value-accretive investments that leverage our core franchise capabilities, strengthening our product offering and customer penetration, enhancing the quality and sustainability of our earnings.

Below our top line, our operating expenses increased by 8% year-on-year, as shown on Slide 34, in line with guidance, balancing cost discipline with strategic investments in technology and people as we strive to offer innovative products and best-in-class service to our clients. Personnel expenses increased year-on-year, primarily due to sector and bank-specific union agreements as well as through performance-based variable remuneration and selective recruitment of new talent and specialist skills, leveraging voluntary exit scheme offerings.

Admin expenses growth reflects initiatives aimed at enhancing customer experience. Similarly, depreciation charges reflect our sector-leading investments in technology and digital infrastructure, enhancing productivity, commercial effectiveness, digital offering and cyber security. As our CEO just mentioned, in May, we successfully completed the migration to our new cloud-based core banking system, the largest banking technology transformation ever undertaken in Greece and one of the most significant in Europe.

This milestone places MBG at the forefront of modern banking infrastructure and creates a platform for faster innovation, efficiency and superior customer service. As illustrated in Slide 17 to 19, we are also accelerating the adoption of AI across the organization from the SOPHiA Digital Assistant to the introduction of an AI-powered voice agent in our contact center, the first in the domestic banking sector.

Crucially, these investments are being realized without compromising efficiency with our cost-to-income ratio kept at industry low levels below 35%, supporting another positive full year '26 target revision. As regards credit risk charges, near 0 NPE flows, combined with our leading coverage levels by European standards support the cost of risk below 40 basis points, in line with our full year expectations, displaying consistent normalization despite geopolitical uncertainty.

Turning to Slide 23. Our capital position remains a key competitive advantage. In Q2, we absorbed a pickup in risk-weighted asset growth driven by strong credit expansion as well as superior payout accruals with our core equity Tier 1 ratio standing at 17.3% and our total capital ratio at 21% -- at the same time, our MREL ratio of 28.4% remains well above the regulatory requirement of 26.7%. While these levels provide significant resilience in an uncertain environment, they also create substantial strategic flexibility.

Our capital allocation strategy and priorities as disclosed on Slide 14, remain disciplined and firm, supported organic growth and superior ordinary shareholder distributions while maintaining optionality on extraordinary distributions and value-accretive strategic transactions depending on opportunities. The examples of Allianz and Rome transactions are testament to this. Capital deployment of less than 20 basis points for both transactions, delivering profitability of circa EUR 80 million in 2027 and over EUR 100 million in 2028.

Now let me walk you through the highlights of our standard balance sheet summarized on Slide 22. As referred to earlier, trade expansion accelerated in Q2, driving our performing loan book EUR 2.1 billion higher year-to-date, comparing well to our full year credit expansion target of over EUR 3 billion, as shown on Slide 26. This reflects loan disbursements of EUR 5.5 billion, up by 30% year-on-year, driven by healthy credit demand across customer segments as shown on Slides 27 and 28.

Corporate lending remains a key driver with disbursements up by 33% year-on-year allocated across sectors with emphasis on energy, shipping, tourism and infrastructure. Loan origination dynamics were positive in the retail segment as well as momentum continues to pick up across retail products with disbursements rising by 20% year-on-year to EUR 1.3 billion, driving retail performing exposures EUR 0.3 billion higher year-on-year.

On the liability side, deposits increased by EUR 3.5 billion year-on-year, as shown on Slide 29, driven by pricing elastic core deposit inflows, which comprise more than 80% of our total deposits. Our deposit and total funding cost stood at 27 basis points and 64 basis points, respectively, as depicted on Slide 31, the lowest in the domestic market, evidencing our superior liquidity profile.

Our liquidity coverage ratio stands at 230%, amongst the strongest in the euro area with our loan-to-deposit ratio settling at 67%. A few words on asset quality illustrated on Slides 35 and 36. Our NPE ratio of 2.4% is supported by benign asset quality trends as flows remain unaffected by uncertainty, supporting a cost of risk below 30 basis points as per our guidance.

Our leading coverage levels comprise another strength of MBG's balance sheet, providing cushion against potential risks, reinforcing our resilience. In the first half of the year, we delivered robust profitability, which has led us to upgrade our return on tangible equity and EPS targets for the year, supported by an improved outlook for core income dynamics. Beyond financial performance, our investments in technology have positioned us well ahead of domestic as well as many European peers, establishing a clear competitive advantage as we leverage the capabilities of a modern IT infrastructure, facilitating the deployment of AI across the bank.

At the same time, our strategy sets the foundations for sustainable value creation beyond 2026. Our capital position provides us with a mass strategic flexibility, enabling us to combine organic growth with superior shareholder distributions while maintaining strategic optionality for capturing value-adding opportunities. Long-term value creation for our shareholders is a key priority.

And with that, I would like to open the floor to questions.

[Operator Instructions] The first question is from the line of Benjamin Caven-Roberts with Goldman Sachs.

Two for me, please. First, on NII. Could we please just dig into the NII trends as we move into the second half? And how much of a benefit you'd still expect to see from repricing your book to higher Euribor levels, particularly given the current run rate of 3 months Euribor is close to 2.5%. And then how much of this you'd expect to be eroded by competition on loans and deposit mix? And then secondly, just to drill into the core banking system in more detail, how soon should we see the benefits of those new capabilities from a revenue perspective? And how should we think about the reduction in costs of the completion of that technology project facilitates?

Thanks for the question, Ben. So I'll take the first one. So clearly, I think the basis of our upgrading of the targets is on NII. So we started the year expecting market rates to be a bit lower. Given the developments that we had in the first half of the year, this is materializing at higher levels. And as a result, the key driver for our NII growth in the second half will be market rates. And as a result, we've also upgraded our net interest margin guidance to circa 280 basis points.

Now having said that, we are also experiencing a strong growth in lending in the first half of the year with a pipeline that is very promising for us to deliver the overall growth for the year, which is just over EUR 3 billion. So volumes will also contribute to the NII growth for the year. You mentioned headwinds as well. And indeed, we are still facing a period where spread compressions are materializing at a decelerating rate.

But yet again, we do have to face them. In our expectations, the spread compression for the year is in the area of 15 to 20 basis points. So there is still some coming towards the end of the year. But all in all, as you've seen, we expect a mid-single-digit growth in our NII. And overall, we are very positive about the second half of the year. And Pavlos could...

A difficult question on the benefits of new technology, whether it's the core banking or the digital or the AI. Clearly, the shift to digital, I think you've seen the most tangible reduction in costs by having us reduce the size of the branch network significantly over EUR 150 million of savings over the past few years on that. The revenue benefit from core banking will depend as we put on more applications we generate revenue. That's going to be gradual. It won't be something you'll see big jumps in. AI will certainly lead to reductions in call center costs. I already mentioned 25%. That should increase. That should be tangible in the OpEx line, not the CapEx line.

We will be reducing licensing costs as we decommission more and more of our legacy systems. So it will be continuous and gradual, and I presume it will be accelerating in the outer years. I think these estimates will take more meat on the bones as we progress. So we'll take a stab at it certainly in the business plan for the next business plan, which we will present at the beginning of '27. But I'm sure you understand that it's work in progress. And though they'll be there, the exact time you realize it and create the productivity gains will be more difficult.

The next question is from the line of Mehmet Sevim from JPMorgan.

I was just wondering if you could give a little more detail on the Romeos Capital partnership and the fee impact that you see from there. Is that just plugging the CRE portfolio into your balance sheet and essentially the rental yield? Or how does this number come together? And is the CRE portfolio in Greece? Or is it international? And you mentioned an initial investment of EUR 400 million. Where would you see that growing over the years, if I may ask?

And then could you also please comment on the very strong deposit trends in the quarter, I think 6% quarter-on-quarter. We're seeing this across the sector and how that would help you maybe if you deploy it in higher-yielding assets and essentially how it would help your NII in the remainder of the year beyond the rate impact?

Okay. I'll take the first one, Sir. So the agreement with Rome is for an asset management deal coming in with a portfolio of EUR 0.4 billion, as we said, just a bit over EUR 400 million. That's how the fees will come. That's how the value will come. When we talk about CRE portfolio, we want to be very disciplined. And as we repeated, both Pavlos and I, very selective with strict criteria.

We are talking about buildings in Athens, not anywhere in Greece because you mentioned also if it's outside Greece. So it's -- so far, this is buildings in Athens. And we envisage to grow the portfolio at least to start with around EUR 700 million, EUR 800 million, somewhere there. But that's the aspiration so far and the numbers that we shared up to this point are based on these kind of assumptions. And Pablo?

On deposits, the jump you've seen I think in most of the banks that have announced so far, including ourselves, it's been partially inflated by corporate actions, i.e., equity raisings, PPC raising EUR 4 billion and depositing most of that in the 4 systemic banks or the Greek banks, I should say. That has -- for us, it's been led to inflation of around EUR 700 million in deposits. It will be around for a while until PPC decides to use it for investments. So there is a bit of inflation.

But other than that, clearly, the growth of the economy -- the loans are creating deposits. So there's a lot of the organic loan growth is creating deposits as well. So it is sort of a natural phenomenon of loans creating deposits and deposits creating loans that you're seeing with an add-on of the various corporate actions by 3 or 4 or 5 large Greek corporates.

The next question is from the line of Alex Demetriou with Jefferies.

Just one on capital, please. It was nice to see another strategic transaction announced this quarter. But going forward, if we think about the other uses of excess capital, specifically on the extraordinary payouts, would this be an annual decision made towards the end of each year? Or should we think about it being deployed closer to the end of the current business plan if no inorganic options are found? And just kind of a quick follow-up to that. Are there any other areas you'd like to kind of further strengthen the bank or you focus on here in the inorganic side?

Well, I think you have to be patient, and we'll make announcements as they come on the inorganic. Now on the one-off payment -- dividend payment, the decision will come later in the year as it did and right before the AGM as it did last time. we've described the strategy, our preferences for M&A as the use of the excess capital. And if increasing the annual payment as well and the one-offs are a compromised solution between the 2.

And just to add, we have Slide 14 on our presentation where I think we express our thinking, our strategy with regards to the capital deployment across the next couple of years with the options that we have on our toolkit. And as Pablo said, decisions for finalizing ordinary payouts or any extraordinary payouts are taken towards the end of the year when we complete next year's 3-year business plan, along with the capital planning. So that's more or less the time line that decisions are usually being made.

The next question is from the line of Gabor Kemeny with Autonomous Research.

A quick one from me, please, on loan growth. We saw some of your peers upgrading the loan growth and the disbursement guidance, MBG't. Can you share your thoughts around that, especially in light of the strong finish for the RRF application and the decent H1 dynamics?

Yes, we're sticking with the guidance of slightly over EUR 3 billion net expansion. As you realize, it's the corporate sector that's providing the bulk of the growth. These are bulky. We saw some in Q2, which could have gone in Q3. So it's -- I think we feel comfortable with the slightly over EUR 3 billion guidance. We do have a pipeline. It's a decent pipeline, but there are large corporates which can get hung up on approvals of licensing and other sort of things. So to be maybe a bit conservative, I think we're sticking with the guidance of slightly over 3.5 billion -- slightly over EUR 3 billion...

The next question is from the line of Panagiotis Kladis with Alpha Finance.

Just a quick one on the interim dividend. If I recall correctly, last year, you announced along with the second quarter results. So what we expect for this year? What is the planning?

[indiscernible], we don't have any intention not to do it, but you have to appreciate that we are undergoing our internal as well as discussions with the regulator. So if everything goes according to plan, somewhere in Q4, we intend to reperform what we've done last year with regards to the action of interim dividend.

And I guess the announcement could take place any time. It's not necessary to -- I mean to expect next quarter results, right?

No, I think we are obliged maybe to do a bit sooner. We'll see. We'll see.

The next question comes from the line of Luis Garrido with Bank of America.

I have 2 questions, please. The first one on loan growth. When you look at some of the numbers on loan growth on the back of the pack in structured finance or in shipping, which are smaller portfolios, but nonetheless are growing very fast. Are you embedding assumptions of higher cost of risk in the medium term after that rate of growth and why or why not? And the second question just on strategy and use of excess capital. In your comments earlier, you've linked the changes to the IT system to M&A, which to me seems to point to maybe larger transactions than some of the partnerships that you've done so far. Would that be a correct read?

On the cost of risk, so far, the Greek economy is performing at a rate when you look at the profits of the corporates, their leverage that I don't see an increasing cost of risk. Actually, I think probably the opposite is the way -- the direction of travel. So not -- no, I don't see any conditions here for an increasing cost of risk. I think the underlying credits we're seeing are exceptionally good.

And therefore, we have high coverage as well, which is another reason for -- that would lead to a higher cost of risk, but we have sector-leading or even European sector-leading coverage ratios for Stage 1 and Stage 2 as well as Stage 3, but they're not much Stage 3 left. So that's on the cost of risk. And then on the core banking, clearly, we have a very modern core banking system now that is expandable, okay? Now to link that to M&A is a jump, but it's certainly not a constraint.

Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to Mr. Mylonas for any closing comments. Thank you.

Well, thank you for joining us. I know it's very close to your vacations. Hopefully, we haven't delayed them. So may I wish you all a relaxing summer, and we'll be talking soon and meeting soon in the early fall. So thank you very much.

Ladies and gentlemen, thank you for standing by. I am Yiota, your Chorus Call operator. Welcome, and thank you for joining the National Bank of Greece conference call to present and discuss the first quarter 2026 financial results. At this time, I would like to turn the conference over to Mr. Pavlos Mylonas, CEO of National Bank of Greece. Mr. Milonas, you may now proceed.

Good morning, everyone. Welcome to our first quarter 2026 financial results call. I'm joined by Christos Christodoulou, Group CFO; Greg Papagrigoris, Group Head of IR. After my introductory remarks, Christos will go into more detail on our financial performance, and then we will turn to questions and answers.

I will begin with the description of the macroeconomic backdrop of the Greek economy in view of the recent unrest in global energy markets and their potential repercussions. To start, the Greek economy entered 2026 on a strong footing, bolstered by significant carryover effects from 2025, approximately 1 percentage point of GDP, and solid underlying fundamentals. Moreover, Greece continues to benefit from a set of structural and cyclical buffers, which should offset most headwinds, if the current shock eases by mid-2026, as markets expect.

Specifically, private sector balance sheets keep getting stronger, underpinned by sustained corporate profitability and a robust labor market. In fact, leading indicators of business activity remained resilient through April 2026, while the response of forward-looking survey data has been markedly milder compared with the initial phase of the war in Ukraine.

Following a temporary slowdown in April, tourism activity is expected to gain traction in the core months of the tourism season with flight scheduling and early booking data indicating high single-digit growth in arrivals, though there's a question mark surrounding pricing, which may be soft.

The main growth driver in 2026 will be investment, reflecting high capacity utilization rates across the business sector and a robust pipeline of projects scheduled for completion over 2026, 2028. This momentum is further reinforced by the additional impulse from the historically high inward foreign direct investment and M&A activity recorded in 2025, EUR 12 billion and EUR 24 billion, respectively. Moreover, around EUR 15 billion of RRF resources, both public and private sector use are scheduled to be injected into the real economy over the next few quarters.

An additional important buffer to the current external developments is provided by the high primary surplus of 4.9% of GDP recorded in 2025, the highest in the EU. Indeed, new fiscal measures of EUR 2.5 billion have already been activated for 2026. That's approximately 1 percentage point of GDP. At the same time, structural improvements in the energy mix, including higher renewable usage and a broader fossil fuel supplier base alongside the geographical diversification of tourism and a widening export base further enhance the economy's resilience and security.

Overall, these supportive factors are expected to sustain the economy's positive growth trajectory in fiscal year 2026 with a robust recovery forecast following a crisis-induced slowdown anticipated in the second quarter. In fact, the Greek economy should remain firmly on track for another year of robust growth, albeit slightly slower than 2025, but with a continued outperformance -- strong outperformance relative to the euro area.

In this environment, loan demand from both corporates and households should remain strong in the high single digits in total. The European macro developments may have countervailing impacts on the bank's results as a slightly higher euro interest rates due to inflationary pressures would boost NII, while a sharper GDP slowdown would slow external demand and thus activity.

On that note, let me turn to our financial results. Our first quarter 2026 financial performance has remained solid, underscoring the resilience of the Greek economy as well as the strength of our balance sheet. Based on market expectations for the duration of the geopolitical uncertainty, we expect to achieve our fiscal year 2026 -- our full year 2026 guidance.

Our first quarter 2026 profit after tax amounted to EUR 344 million, up 23% relative to the fourth quarter of 2025 on the back of an accelerating NII recovery, continued strength in fee and noninterest income generation and lower operating costs. As a result, our return on tangible equity stood at 15.3% normalized for high trading or 16.3% on a reported basis, supporting the achievement of our full year expectations.

Adjusted for excess capital, but also the high first quarter 2026 trading income, our return on tangible equity stood at an impressive 20%.

Turning to main drivers of our results. First quarter NII up a solid 2% quarter-on-quarter, reflected recent healthy asset growth, especially in Q4 despite seasonality in Q1 and a notable drag from the lower calendar days. Importantly, net interest margin, NIM, is stabilizing as both spread reduction and the effect of lower benchmark rates are both fading. Upside risks are materializing moreover from the market's projected path for euro area interest rates.

As regards credit expansion, both corporate and retail disbursements accelerated significantly relative to the first quarter of 2025, leading to a double-digit growth rate in loans of 12% year-on-year and a performing exposure expansion of EUR 700 million. Corporate credit continued driving its performance, up 16% year-on-year, with credit demand diversified across a broad range of sectors, energy, shipping, accommodation.

Regarding the retail segments, growth across all segments, consumer, mortgages and small business exceeded that of the market, resulting in market share gains. In the second quarter, we have not observed an impact from uncertainty on credit demand. In fact, we see a mild acceleration in the corporate segment, partly linked to RRF deadlines brought forward, while the pace of retail application remains unchanged.

Combined with our sizable pipeline of approved, not yet disbursed loans of about EUR 2 billion, we can reconfirm our full year target for net expansion of over EUR 3 billion.

Turning to commissions. Our fee income growth continues to be in the high single digits, up 8% year-on-year, with investment fees remaining the most notable contributor, up 60% year-on-year, reflecting sustained and significant gains in mutual fund market shares, about 7 percentage points since the beginning of 2024 and nearly 1 percentage point in just the first quarter of 2026. The evolution of our cost results in a cost-to-income ratio of 34% or 35.7% normalized for the first quarter 2026 trading income. We balance our cost discipline with our commitment to invest in our people through the onboarding new talent, leveraging the cost savings from our recent VES, about 280 departures, as well as some higher wages, partly emanating from the collective agreements and from variable pay linked to productivity improvements.

In the same direction, our multiyear investments in technology and digital infrastructure provide us with competitive advantages as regards to commercial effectiveness, digital offerings and cybersecurity. Special mention, the completion in the next few weeks of the bank's final step to the new cloud-based core banking system, a major achievement, on time and on budget, which opens the door to a plethora of new functionalities and opportunities for the bank, just to name a few, virtual accounts, open up accounts, more efficient liquidity management.

As regards our capital, organic generation before distributions continue to be strong in the first quarter, adding 40 basis points of capital. Post payout accruals CET1 [ hedge ] slightly lowered to 18.4% and to 17.4% pro forma for the EUR 300 million special dividend -- special payout. As in 2025, the final payout level for 2026 will be determined at the end of the year.

This extensive capital position, one of the key competitive advantages, provides security during these uncertain times while allowing for superior shareholder returns and significant strategic opportunity.

In line with the strategic direction, we have taken a significant step toward enhancing our fee-generating capabilities, signing a memorandum of understanding, MOU, with leading global insurer Allianz that sets out our intention to enter into a long-term bancassurance partnership. The rationale of the agreement is to strengthen our ability to deliver enhanced customer-centric insurance solutions while maintaining a capital-light model, thus contributing to sustainable earning growth and long-term value creation for our shareholders.

Specifically, the agreement would establish a 10-year exclusive collaboration expected to commence in the first quarter of 2027 with the potential for an extension and is complemented by the signing of a memorandum of understanding that sets out the intention for NBG to acquire a 30% minority stake in Allianz European Reliance, subject, of course, to regulatory approvals.

This strategic partnership is expected to lead to a meaningful uplift in our fee income, up 4x for insurance fee income. The key drivers will be access to a comprehensive market-leading product suite, leveraging Allianz's expertise in products and sales. Moreover, Allianz's advanced digital capabilities will facilitate a quick transition to the new operating model, but also support the rapid introduction of new product and service offerings.

From a financial perspective, the partnership is set to deliver EPS and return on tangible equity accretion of 4% and more than 50 basis points, respectively, already by 2028.

To close, it is important to highlight that the current environment defined by heightened geopolitical uncertainty, our strategic priority remains firm: to increase shareholder value by increasing our revenue base on a sustainable basis and in the event of inorganic growth to create tangible value through synergies.

And with that, I conclude, and I'd like to pass the floor to our group CFO, Christos, who will provide additional insight to our financial performance. And then we turn to Q&A. Christos?

Thank you, Pavlos. So let me walk you through the key highlights of our profitability, starting with Slide 15. Despite geopolitical uncertainty and Q1 seasonality, we delivered a strong start to the year with key performance indicators supporting our full year guidance.

Profit after tax reached EUR 344 million, up 23% quarter-on-quarter, translating into an earnings per share of EUR 1.52 or EUR 1.43 normalizing for the trading income in the quarter. Our profit after tax in Q1 delivers a return on tangible equity of 16.3% on a reported basis before adjusting for excess capital or 15.3% normalizing for trading income, placing us comfortably on track to meet our full year guidance. Importantly, adjusting for excess capital, return on tangible equity rises to 20%, highlighting the potential [indiscernible] as we utilize our excess capital as well as the significant earnings capacity embedded in our franchise.

Our strong financial performance reflects increasing momentum in net interest income recovery, complemented by continued strength in fee and noninterest income generation.

Going into more detail on Slide 19. Our NII continued to build momentum in Q1, increasing by 2% quarter-on-quarter despite the negative calendar base effect as well as some residual repricing of our interest-bearing assets, reflecting last year's lowering market rates. Growth was primarily driven by healthy net credit expansion of EUR 0.5 billion on a seasonally low quarter, alongside increased exposure in our fixed income securities, providing additional support to our NII.

Notably, our net interest margin has broadly stabilized as spread reduction is easing off. Sustained balance sheet expansion supports a favorable NII trajectory in the coming quarters, reinforcing our confidence in delivering our full year guidance while higher base rates provide upside potential if maintained.

Our fee income remained on a strong trajectory, increasing by 8% year-on-year, driven by retail fees, which are up 20% year-on-year as shown on Slide 25. Growth in the retail segment reflects continued momentum in investment product fees, increasing by nearly 60% year-on-year, evidencing the effectiveness of our cross-selling strategy and increasing customer engagement. We continue to see a structural switch of time depositors to fee-generating mutual funds, supporting mutual fund market share gains of nearly 1 percentage point in the first quarter and 3 percentage points year-on-year.

As shown on Slide 26, our retail funds under management reached EUR 9.6 billion, 26% higher year-on-year. This performance is testament to the growing client confidence in our wealth management capabilities and our cross-selling capacity.

Building on this strong momentum in fee generation, we announced yesterday the signing of an MOU with a leading global insurer, Allianz, setting out the intention to enter a long-term exclusive bancassurance partnership as well as the acquisition of a 30% minority stake in Allianz European Reliance as outlined on Slides 12 and 13 of our presentation. This strategic move, expected to commence in the first quarter of 2027, will bring together NBG's leading distribution platform with Allianz's global expertise, technological strength and innovative products, enabling us to offer a comprehensive market-leading suite of insurance solutions supported by enhanced digital capabilities and superior client experience across channels. The partnership will accelerate our fee growth with our insurance-related income expected 4x higher compared to the 2026 numbers. This will add 6 percentage points of incremental fee growth over and above our guidance for a high single-digit growth on total fees for 2027 and 2028, delivering a return on tangible equity and EPS accretion of over 50 basis points and 4%, respectively.

Overall, this transaction represents a key step in scaling up our fee income and reinforces our strategy to diversify revenues and create sustainable long-term value for shareholders.

Below our top line, operating expenses were up by 8% year-on-year as disclosed on Slide 27. Personnel costs reflect increasing remuneration in line with the sectoral union agreements and the continued investment in our people, including variable pay to incentivize performance and productivity as well as the onboarding of new talent, leveraging voluntary exit schemes to rejuvenate our workforce. Higher G&As are mainly driven by spending that enhances our customer experience, while depreciation charges reflect our leading investments in technology and digital infrastructure. These investments, including the replacement of our core banking system, which reaches completion this month, are translating into tangible gains in our competitiveness, productivity, commercial effectiveness and, as the CEO mentioned, cybersecurity.

Alongside these strategic investments through which we aim to offer innovative products and high-end services to our clients, our cost discipline remains sharply in focus with our cost-to-income ratio kept at sector low levels of 34.3% or 35.7% normalizing for Q1 trading income, comfortably within our full year guidance.

As regards credit risk charges, we have seen no pickup in formation trends, while sector-leading coverage levels provide additional security during uncertain times. Our cost of risk remained below 40 basis points, boding well with our full year guidance.

Moving to Slide 17. Our capital position allows for a superior shareholder returns, also evidenced in the EUR 1 billion capital distribution recently approved by our Annual General Meeting. Organic capital generation amounted to 40 basis points quarter-on-quarter, absorbing risk-weighted asset growth, driving our core equity Tier 1 ratio to 18.9% in Q1. Factoring in a provisional payout accrual, our CET1 ratio stood at 18.4%. As already mentioned by Pavlos, the level of the 2026 payout will be determined at year-end 2026.

Finally, pro forma for the special buyback of EUR 300 million that will commence in June, our CET1 ratio stands at 17.4%. Our total capital ratio stands at 21.1%, with the MREL ratio at 28.8%, including our inaugural AT1 issuance in February, standing well above our requirement of 26.7%.

As our CEO mentioned, our strong capital buffers provide resilience in an uncertain geopolitical environment as well as significant strategic optionality.

Now let me walk you through the highlights of our balance sheet summarized on Slide 16. As referred to earlier, credit expansion had a good start to the year despite seasonality and affected by geopolitical uncertainty, driving our performing loan book EUR 0.7 billion higher year-to-date, as also shown on Slide 21. This reflects loan disbursements of EUR 2.5 billion, up by nearly 50% year-on-year, highlighting sustained credit demand and our success in capturing high-quality lending opportunities. Corporate lending was a key growth engine with disbursements up by 55% year-on-year, focused on dynamic sectors that continue to benefit from structural growth trends and investment flows, namely energy and renewables, shipping and tourism. Adding to this, the retail segment also delivered a solid performance with disbursements rising by nearly 30% year-on-year, supported by market share gains across small business, consumer lending and mortgages on the back of improving customer penetration and product service offerings.

Encouragingly, momentum has carried into April and disbursements remaining strong, providing comfort towards fulfilling our full year guidance.

On the liability side, deposits remained resilient, up by EUR 2 billion year-on-year, as shown on Slide 22, driven by continued inflows of low-cost sight and saving accounts, comprising more than 80% of our deposit stock. At the same time, the migration of time deposits to mutual funds continued, benefiting our fee generation as well as our funding mix and cost.

With deposits comprising almost 90% of our total funding and term deposit yields 3 basis points lower quarter-on-quarter to 140 basis points, our deposit and total funding costs remained below 30 and 65 basis points, respectively, the lowest in the domestic market as depicted on Slide 24. Evidencing our superior liquidity profile, our liquidity coverage ratio stands at 237%, amongst the healthiest in the euro area with our loan-to-deposit ratio settling at 69%.

Now a few words on asset quality, illustrated on Slides 28 and 29. Our NPE ratio at 2.4% and our NPE coverage of over 100% are supported by benign asset quality trends as net NPE flows came at near 0 levels in the first quarter. At the same time, our leading coverage across stages by European standards comprises another strength of NBG's balance sheet, providing cushion against potential downside risks, reinforcing our resilience.

To conclude, despite uncertainty, we delivered a strong start to the year, confirming the strength and resilience of our operating model and our capacity to create value for our shareholders. Performance across key metrics supports our full year guidance. Core revenues in an upward trajectory, efficiency kept at best-in-class levels despite significant investments in technology and innovation, solid asset quality and the balance sheet that continues to act as a lever for growth. Our strong capital position balances superior shareholder returns with strong capital buffers, providing resilience during uncertain times as well as strategic optionality, allowing us to navigate the current environment with confidence.

And with that, I would like to open the floor for questions.

The first question comes from the line of Ben Caven-Roberts with Goldman Sachs.

Two from me, please. First, on the lending pipeline. Could you just elaborate a little more on the interplay you're seeing between your lending pipeline and the current situation in the Middle East, how that's impacting, for instance, shipping and tourism lending, which I know you mentioned as contributing to the Q1 disbursements? And then where you see upside and downside risks compared with a few months back? And then secondly, just a technical point on Q1 trading, clearly a high income level, as you mentioned in the slides. Anything you would highlight there in particular?

Okay. Thanks for the questions. It's a bit early. I think the disbursement pipeline is still based on approvals that have already occurred, so between sort of time to money -- from time -- from yes to money, it takes almost 2 months, 1.5 months. So you're still seeing approvals of projects which are pretty mature. The key question is on appetite for new projects. And it's still, I would say, a bit early to make a decision. I think most people are still moving forward with their projects. Certainly, on retail, which is more granular, we're not seeing a slowdown in applications. Quite the contrary, they're quite steady at the levels pre end February. So I think the question is, let's see how long the crisis lasts.

Clearly, if there's high uncertainty, I would guess there will be some delays in investments, but I think that this would have to be a much longer period of uncertainty than what is now sort of being bandied about by markets and by investors sort of until the midyear. So I guess the quick answer to the question is, if uncertainty lasts past the midyear, then we would probably see a slowdown in large investment products.

On trading, it was an opportunity in the volatility to -- for trading, let me put it that way. Okay?

The next question comes from the line of Mehmet Sevim with JPMorgan.

I have 3 questions, please. One on NII, which is very strong this quarter, came well above expectations. I was wondering how you're thinking about the coming quarters now considering the strong pipeline as well as the recent moves in short-term rates given your sensitivity?

And my second question is on the Allianz deal, the 6 percentage point incremental fee CAGR that you're guiding. Is this a plug-and-play assumption from day 1? Or do you expect any synergies over the period? And I'm assuming this is a combination of the bancassurance fees as well as the associate income from your stake. So could you please confirm if I'm thinking in the right way?

And finally, on the VES, the EUR 60 million charge, could you please disclose how many FTEs are exiting? And what's the expected annual cost savings and over what period -- time period this will come?

Now indeed, our NII came in nicely in the first quarter despite the seasonal effect of the calendar days. Obviously, this is benefiting from the strong pipeline of disbursements that we had in Q4 and also the fading, let's say, repricing of our back book given the lowering market rates that we had to endure last year. Now going forward, the key lever for growth is what we have discussed also during our annual results and the guidance. Growth of our loan book especially is going to be the driver for growth in our NII. And as we disclosed also on our NII slide, the market rates will also play an effect. So our guidance stands as of now for a low single-digit growth in NII for the year. Given the sensitivity for every 25 basis points for EUR 40 million on an annual basis for an NII, if the current, let's say, view on market rate sustains, there is upside risk for NII going forward.

Having said that, we want to wait until the second half -- the second quarter of the year until things settle down before we update on our guidance. And another point on our net interest margin, given the dynamics we see, we believe that this quarter is probably the trough quarter for our NIM. So from this point onwards, it's going to be an improvement also on NIM.

On the second question with regards to our prospective partnership with Allianz, the 6 percentage points upside on the guidance that we've given on fees CAGR is not assuming any synergies from cost. It's pure income generation based on the strategic partnership. So it's pretty straightforward.

And with regards to our VES, I think the CEO mentioned that this VES was more or less in the area of 280 people. The annual saving will be in the area of EUR 15 million. And in 2026, we will assume about half of that depending on the timing of the exits of our people.

The next question comes from the line of Gabor Kemeny with Autonomous Research.

Further questions on Allianz. Can you give us a sense how this guided 4% EPS accretion compare with Allianz's recent performance, like what they actually delivered in the last year or 2? And just to confirm the numbers, do you mean here about EUR 45 million, EUR 50 million of profit contribution? So that's firstly on Allianz and then I have another question.

Let me start on the first question. So the key driver of the growth in our fees is mostly deriving from the strategic bancassurance agreement. So the performance of the company in Greece so far is not the key driver for growth. And you have to put into the equation that given our partnership, the profits of the company are expected to grow and not be very relative to what they've been doing so far. But I don't want to comment on the profits of Allianz Reliance yet. So that's our view.

Okay. I mean you guide for EUR 40 million, EUR 50 million of earnings accretion as I understand, the 20 basis points of CET1 consumption maybe implies EUR 80 million, EUR 90 million of capital consumption. Am I missing anything there?

Well, that's part of the equation. You need to take into account regulatory filters and any goodwill, which would contribute to that 0.2% capital consumption that you see. But given where we are at the moment, I think you should be okay with the 02%.

And just on -- do you see yourself being a minority shareholder longer term in this surely very capital-effective way of owning the stake? Or do you see a chance of raising your stake?

No, I think we are happy with the 30%. I think you've heard our views on insurance. We prefer to partner with a large European world, in this case, a partner who has expertise and they provide the expertise in the factory, we provide the expertise on the distribution and the combination is a win-win.

The next question is from the line of Robert Brzoza with PKO BP Securities.

I have 2 quick questions. Some of my questions actually have been answered so far. What are your thoughts on the potential increase in the macro overlay given the current situation in the Gulf? That's number one. And number two, on the Allianz acquisition again, I'm just wondering if you could provide any specific examples where you think a new bancassurance offering could add value? Would it be more in the retail lending offering or corporate lending? And in which specific areas of the bank activities you might offer something new for your clients?

Okay. I'll take the first question. So if I understood the question correctly, you were asking whether we have taken into account the macro effect of the volatility and geopolitics in our asset quality and provisioning models. The answer is yes. So what we have come out with takes into account this situation, the current situation. And on the second, Pavlos, we will take it.

Clearly, the bulk of the bancassurance agreement comes from selling to retail. It's not -- so this is a retail model for the most part going mostly to branches, and I'm sure in a second stage through digital channel. But it is a way to reach the very large customer base of National Bank.

The next question is from the line of Alex Demetriou with Jefferies.

Two questions, please. Firstly, on the NIM, could you just unpack how you expect it to grow from here over the coming quarters to reach the full year guidance? And just second question, another one on Allianz, sorry. Just on the fee side, is this purely on the bancassurance side? Or are you also seeing some kind of uptick from investment products as well?

Okay. On the NIM, so as you've seen, we've landed the NIM of 272 basis points for Q1 with all the, let's say, the negatives that we had in Q1. I'm repeating the calendar days and the fact that we still had some delayed repricing in our back book from lowering market rates in 2025. So going forward, given the benefit that we expect from our growing assets, adding to that, the fact that we see the spread compression slowing down. And going forward, as we guided at the year-end results, we expect not more than 15 basis points of overall spread compression in the year.

And also taking into account current market rates, I think we are very well set to meet, if not exceed our full year guidance of over 275 basis points of NIM for this year. And going forward, I think we are very well set again to exceed 290 basis points, which was our target for 2028.

Your second question on asset management, yes, I think what we have pointed out as upside potential from the partnership, the long-term strategic partnership with Allianz is clearly on bancassurance and insurance. But having said that, partnering with a global player like Allianz, we do see upsides in other streams as well. And to be very frank, that could be another lever for growth for us in the future.

Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to Mr. Mylonas for any closing comments. Thank you.

Okay. Thank you all for joining us for the first quarter results despite an exciting day in the markets once again. We're available for further follow-up questions, as always, and we hope to see you in forthcoming roadshows. So have a good day.

Ladies and gentlemen, thank you for standing by. I am Gelly, your Chorus Call operator. Welcome, and thank you for joining the National Bank of Greece conference call to present and discuss the full year 2025 financial results. At this time, I would like to turn the conference over to Mr. Pavlos Mylonas, CEO of National Bank of Greece. Mr. Mylonas, you may now proceed.

Good morning, everyone. Welcome to our fourth quarter 2025 financial results call. I'm joined by Christos Christodoulou, the Group CFO; and Greg Papagrigoris, Group Head of IR. After my introductory remarks, Christos will go into more detail on our financial performance, and then we will turn to questions and answers.

As usual, I will refer to Greece's macroeconomic developments first, then turn to our fourth quarter results. and I will conclude with our guidance for the next 3 years, 2026, 2028. So let's begin. The Greek economy remains on a steady, upward trajectory, notwithstanding persistent global volatility amid intensifying geopolitical tensions with the EU appearing particularly exposed to ongoing structural shifts.

Within this challenging environment, Greece has delivered not only a resilient performance, but also a more balanced and higher quality growth mix. Indeed, the recovery has become more broad-based with manufacturing, high value-added services and construction increasingly complementing tourism. The economy remains attractive to investment as gross fixed capital formation is projected to rise to 18% of GDP in 2025, the highest level since the onset of the Greek crisis. While foreign direct investment inflows also reached a record high EUR 12 billion in full year 2025.

Moreover, the economy remains highly competitive. Exports of goods, excluding fuels, have withstood global tariff uncertainty, increasing in real terms by almost 5% in the 12 months, while tourism reached a new record high in the full year 2025, both gained market shares. Looking forward, economic growth and banking activity will maintain their positive momentum driven by: one, private sector balance sheets that keep getting stronger, underpinned by sustained profitability and a robust labor market.

Two, a more supportive policy mix, particularly on the fiscal side, the substantial fiscal overperformance with a primary surplus significantly above 4% of GDP in 2025 sets the stage for a stronger fiscal stimulus in '26 and '27, mainly in the form of tax reductions. Three, approximately EUR 12 billion of RRF funds is scheduled to be injected into the real economy over the next few quarters, while up to another EUR 12 billion can be accessed from the remaining RRF funds. This influx is expected to boost public investment to record levels.

Four, ongoing revaluations and collateral values with real estate prices currently 5% above their pre-crisis peak in nominal terms support private sector spending as well as investment. It is important to note that despite the large increase in real estate values, they are still 15% off their pre-crisis peak in real terms in contrast to European developments. All of the above catalysts are expected to enable the Greek economy to sustain solid growth even in an inherently volatile international landscape, growth that will be, for the most part, bank financed.

Now let me turn to our financial results. Our full year 2025 financial performance has showed significant strength, having exhibited impressive resilience to sharply lower benchmark interest rates, which came down by almost 200 basis points from their peak. This performance has been the result of the confluence of a positive macroeconomic environment, our robust balance sheet characterized by superior capital and liquidity as well as our multiyear transformation with strong investment in human capital, technology and digital services.

Despite positive revisions to our guidance in July, especially in the area of credit growth and fee income generation, we outperformed the revised targets. Specifically, our full year 2025 profit after tax before one-offs was EUR 1.3 billion, resulting in a return on tangible equity of 15.5%. Before adjusting for excess capital buffers, return on tangible equity would be 20% on a normalized capital base of 14%.

Turning to the main drivers of our results. Net interest income resilience was reflected in the net interest margin remaining above 280 basis points, down by less than 40 basis points from its peak, benefiting from solid liability management and robust lending. It is important to note that net interest income troughed in the third quarter and is now on a steady upward trend. As regards to credit expansion, our performing exposures grew by a noteworthy EUR 3.5 billion, recording a double-digit growth rate on a year-on-year basis, far exceeding the upgraded guidance of greater than EUR 2.5 billion.

Corporate credit continues to be the main driver of loan growth, up by 13% year-on-year. Moreover, corporate credit demand was diversified across a broad range of sectors, predominantly energy, transportation, shipping, accommodation and light manufacturing. A final point on the composition of credit. Encouragingly, the retail segment also offered support with solid growth recorded in small business lending, up 16% year-on-year and consumer lending up 7%, resulting in noteworthy market share gains in both sectors -- segments.

Also, mortgage credit closed the year with a positive result on a net basis for the first time in 15 years, following a strong pickup in disbursements where we hold a 28% market share.

Turning to commissions. Our fee business recorded double-digit growth despite the impact of government measures. The most notable contributor was a cross-sell of investment products to our large depositor base, resulting in strong mutual fund market share gains of circa 6 percentage points over the past 2 years and impressive investment fee growth of 70% year-on-year.

It is noteworthy that despite these flows, household deposits maintained their high market share. On the cost side, we have kept a balanced approach, weighing efficiency as evidenced by a cost/income ratio of 34% with judicious sector lending investments in technology and people, which will provide relative advantages going forward. The completion of the bank's full migration to the new cloud-based core banking system marks a defining milestone in our multiyear transformation and growth journey, providing a modern technological backbone that enhances our agility and productivity, elevating our customers' experience.

Despite impressive credit growth and the highest payout accruals in the sector, our capital position strengthened further throughout 2025, up by 50 basis points to 18.8% at the end year. The 60% payout equates to an ordinary distribution of EUR 0.7 billion, implying a total payout per share of EUR 0.77. On top of the EUR 700 million ordinary distribution, we intend to propose an additional capital distribution of EUR 300 million in 2026, which adds up to a total capital distribution of EUR 1 billion. The above proposals, subject to 2026 AGM and regulatory approvals, reaffirm our commitment to deliver superior returns to our shareholders.

Turning to the business plan. We constructed our 2026-'28 business plan factoring in the favorable economic conditions, our inherent competitive advantages and our strong track record in transformation implementation. The resulting guidance is to attain a return on tangible equity of 17% in 2028 and enhance our earnings per share from the current EUR 1.38 to over EUR 1.70 in 2028. These achievements are based on a solid recovery in our profitability as we put benchmark rate normalization behind us, permitting credit and fee generation dynamics to lead top line expansion.

Specifically, we anticipate robust and healthy credit net expansion of over EUR 10 billion over the next 3 years, complemented by a sustained high single-digit fee growth based on our improving cross-sell dynamics across investment, treasury and bancassurance products. The fee targets do not factor in any imminent developments in our bancassurance business. And to preempt your questions, I would like to ask you to have a bit more patience on what is happening on bancassurance. We're in the process of choosing a new partner and should have tangible news in a few weeks' time.

Turning to operating costs. They will benefit from CapEx having peaked and FTE rejuvenation through the implementation of voluntary exit schemes. In fact, we are announcing a new VES in the next few days. As a result, the cost/income ratio will be 36% in 2028. And the final point, the cost of risk will continue to converge to European levels during the 3-year period as the outlook for asset quality remains benign.

The 2026-'28 business plan also contains accelerated capital utilization while maintaining satisfactory capital buffers. During the 3-year period, capital generation from increasing profitability and existing capital buffers will comfortably support accelerated organic growth as well as higher shareholder returns. To that end, our capital plan targets a CET1 ratio of below 16% in 2028. These targets clearly indicate that our capital plan contains sizable distributions going forward while preserving our strategic optionality.

To close, I strongly believe that 2026 is a year of great opportunity for NBG. The successful execution of our strategy during the past several years has been the main reason for our outperformance. To describe all the achievements of the past years, even in summary, would take too long, so I urge you to look at the relevant pages of the presentation on our transformation.

However, it is very important to understand that significant necessary conditions have now been met which permit us to focus on reaping the advantages provided by these accomplishments. Indeed, significant costs, a concomitant management focus and operational risks are behind us.

To this end, our goal has always been to increase shareholder value, which in the long run requires increasing our revenue base and in the event of inorganic growth, the creation of value through synergies. We have shown tight discipline in the use of our excess capital during the past several years and always search for the optimal choice to increase shareholder value, which includes increasing our distributions to shareholders.

And with that, I would like to pass the floor to our group CFO, Christos, who will provide additional insight to our financial performance before we turn to questions and answers. Christos?

Thank you, Pavlos. Starting with the key highlights of our profitability on Slide 22. In 2025, we delivered another strong set of results, comfortably meeting or even exceeding our upgraded financial targets. Our profit after tax before one-offs reached EUR 1.3 billion, translating into an earnings per share of EUR 1.38, absorbing nearly 200 basis points of benchmark rate normalization from peak levels.

As a result, we delivered a solid return on tangible equity of 15.5% or over 20%, adjusting for excess capital, outperforming our full year guidance target. Key contributors to this performance have been the resilience of our income, supported by solid credit expansion and efficient liability management as well as double-digit growth in fees, while strong trading income and steadily normalizing cost of risk also contributed positively.

Going into more detail, our net interest income declined by 9% year-on-year, in line with our expectations and planning. Strong credit dynamics and our effective liability management initiatives, including deposit hedges and MREL instrument refinancing absorbed most of the negative impact of base rates on our NII, sustaining a class-leading net interest margin above 280 basis points, in line with our guidance.

Most importantly, the last quarter of the year marked a turning point in our NII, which edged higher quarter-on-quarter, as shown on Slide 26, aided by the accelerated loan disbursements, which led to an impressive loan expansion of EUR 3.5 billion for the year, far exceeding our upgraded guidance of over EUR 2.5 billion. The completion of our NII normalization cycle paves the way for lending dynamics to become the key net interest income driver going forward.

Our fee income remained on a solid growth path, increasing by 10% year-on-year. This performance was driven by the corporate segment fees, up by 16% year-on-year, as shown on Slide 32, supported by strong loan origination. Retail fees absorbed the negative impact of state measures on payments as successful cross-selling yielded an impressive 70% year-on-year increase in investment product fees, becoming the key contributor to our fee income growth.

As shown on Slide 33, our market share in mutual funds increased by 3 percentage points year-on-year and 6 percentage points over the past 2 years as we continued cross-selling fee-generating mutual funds, driving our retail funds under management up by EUR 2.3 billion, 35% higher year-on-year to EUR 9.3 billion.

Below our top line, operating expenses were 7% up year-on-year as disclosed on Slide 34, balancing high efficiency with strategic investments in technology and in our people as our priority is to offer innovative products and high-end services to our clients. The increase in personnel expenses is driven by increased wages, variable remuneration to incentivize performance and productivity as well as the onboarding of new talent and skills rejuvenating our human capital.

Our depreciation charges derived from our strategic capital expenditure in class-leading IT and digital infrastructure, spearheaded by our new cloud-based core banking system, already delivering results in our productivity, commercial effectiveness, digital offering and cyber risk security. Our G&As affected by seasonality in Q4 are primarily driven by spending that goes to improve our customer journeys and experience.

Factoring all that in, our cost-to-income ratio settled at 34%, well within our annual target, also absorbing interest rate normalization. As regards credit risk charges, benign asset quality conditions throughout the year, complemented by sector-leading coverage levels across stages allowed our cost of risk to continue lower in Q4, settling at 40 basis points for the year, well inside our guidance, reaffirming our expectation for further normalization.

Our robust capital position, as shown on Slide 24, was supported by strong earnings generation and forms a key comparative strength for MBG. Our core equity Tier 1 ratio increased by 50 basis points year-on-year to 18.8%, comfortably absorbing the increase in credit risk-weighted assets as well as our class-leading payout accrual of 60%, which implies an ordinary distribution of EUR 0.7 billion out of 2025 earnings, equating to a payout of EUR 0.77 per share.

Our total capital ratio stood at 21.5% or 22.7% pro forma for our AT1 issuance in early February 2026, while our MREL ratio stands well above our MREL target of 26.7%. Reflecting our capital strength and our confidence in the bank's outlook, on top of accruing the highest ordinary payout in the sector, we intend to propose an additional capital distribution of EUR 0.3 billion in 2026, subject to regulatory approval in the April 2026 AGM.

This decision reaffirms our commitment to keep delivering class-leading shareholder returns while maintaining strategic optionality for future growth opportunities. Now let me walk you through the highlights of our balance sheet summarized on Slide 23. As referred to earlier, we grew our performing loan book by EUR 3.5 billion year-on-year on the back of approximately EUR 8 billion corporate disbursements allocated across multiple sectors with a strategic emphasis on energy and renewables, tourism, shipping, manufacturing and construction as shown on Slide 28.

Adding to this, retail lending continued to gain momentum throughout 2025, increasing by 3% or EUR 0.3 billion year-on-year. We experienced solid growth in small business and consumer lending at 16% and 7%, respectively, with both segments consistently gaining market share, while mortgages are also showing encouraging signs of growth. On the liability side, deposits remained on an upward trend in 2025, as shown on Slide 29, increasing by EUR 2 billion year-on-year on sustained inflows of low-cost retail core deposits, while time deposit migration to mutual funds continued, benefiting our funding mix and cost.

Improving deposit mix with core deposits comprising 81% of the total stock and the drop in term deposit yields by 10 basis points quarter-on-quarter to 144 basis points in Q4 drove our overall deposit cost below 30 basis points, the lowest in the domestic market. As regards our superior liquidity and funding profile illustrated on Slide 31, our net cash position comfortably facilitates our balance sheet expansion and supports our NII and NIM.

Our liquidity coverage ratio at nearly 240% stands amongst the healthiest in the euro area with our loan-to-deposit ratio settling at 66% at the end of the year. Moreover, we retained the lowest funding cost in Greece at around 60 basis points with deposits comprising more than 90% of our total funding.

Now a few words on asset quality on Slides 35 and 36. Our group NPE stock of EUR 0.9 billion translates into an improving NPE ratio of 2.4% with NPE coverage exceeding 100%. At the same time, our leading coverage across stages by European standards comprises another strength of our balance sheet, providing a cushion during uncertain times.

Supported by favorable asset quality trends, net NPE flows came at 0 levels in 2025, driving cost of risk gradually lower. Capitalizing a strong performance in 2025 and the proven track record, our 2026-2028 3-year business plan sets out a clear and disciplined strategy to accelerate growth, enhance profitability and increase shareholder returns with our key business plan targets disclosed in Slides 10 to 20.

As already stated by Pavlos, we aspire to attain a sustainable return on tangible equity of 17% in 2028, driven by higher profitability and increased capital utilization, targeting an EPS of over EUR 1.7 per share in 2028 versus EUR 1.38 in 2025. This performance hinges on strong NII dynamics anticipated higher by 7% on a 3-year CAGR basis as well as fees growing in the high single digits even before factoring the positive impact from the prospective new bancassurance agreement, which we will communicate in a few weeks.

Specifically, as regards to NII, it is expected to start recovering this year, even though the average Euribor is expected at circa 25 basis points lower year-on-year. With the full rate normalization impact behind us in 2027, credit growth should accelerate the NII recovery, driving it over the EUR 2.5 billion mark in 2028 with NIM settling over 290 basis points.

Credit expansion is expected to exceed EUR 10 billion in the next 3 years, driven by corporates anticipated to grow by a high single-digit CAGR in the 3 years, led by large corporates, SMEs and shipping, as shown on Slide 15, complemented by international syndicated lending and structured finance transactions, diversifying further our loan portfolio.

Retail loan expansion is seen picking up further through to 2028, contributing positively to credit growth and spreads, fueled by stronger market dynamics in mortgages as supply side issues are gradually addressed alongside further market share gains in consumer and small business lending. Fee income is expected to maintain the strong momentum, increasing at high single-digit rate throughout the period, supported by the cross-selling of products and services.

In the corporate segment, loan origination fees will be topped by non-lending fee growth on the back of enhanced product offerings supported by our digital channels, delivering incremental product penetration. Retail fee growth will be supported by our strategy in investment products in line with wealth initiatives as well as continuous growth in card fees. As mentioned earlier, our bancassurance strategy, which will further support our fee growth is not yet implemented in the business plan numbers.

Operating expenses are expected to grow by circa 6% on a CAGR basis in the next 3 years, balancing cost discipline with investments in technology and human capital with our cost-to-income ratio settling at 36% in 2028, comparing favorably with most EU peers, which have a large technology investment gap to cover versus NBG. Given high profitability levels, capital generation will remain strong, supporting accelerating organic growth and superior shareholder returns. As Pavlos stated, our intention is to utilize capital created from increased profitability as well as part of our existing capital buffers to consistently increase cash payouts using share buybacks as an additional shareholder remuneration tool.

Our capital plan targets a CET1 ratio of below 16% in 2028, also preserving our strategic flexibility. Leveraging this solid performance and the strength and resilience of our business model, we intend to deliver a disciplined and value-enhancing capital deployment path, balancing superior shareholder distributions with maintaining the capacity to capture growth opportunities, positioning the bank for sustainable growth, greater innovation and long-term value creation. And with that, I would like to open the floor to questions.

The first question is from the line of Benjamin Caven-Roberts with Goldman Sachs International.

Just a few questions from me. Firstly, on loan growth. Could you just comment if there are any particular areas where you're seeing more upside risks and then also any downside risks? And then secondly, on capital, a very clear message around below 16% CET1, which gives strategic optionality. Could you just recap where you're currently seeing your internal CET1 target against which you're measuring that excess capital? And then what your order of priority is within your capital allocation framework between any extra M&A and further payout increase?

Okay. On upsides in loan growth, I think it's the big infrastructure projects of -- in Greece that are the upside risk. If they move faster and given the size of their tickets, I think that's on the upside. I really don't see any sector with downside risk in view of the economic developments that we're observing in Greece right now. So probably more upside risk than downside risk. On your second question on the internal -- our internal CET1, it's 14%. If we utilize the full AT1 capacity that we have, that could go down. Now between M&A and payouts, clearly, it's a bit of a question because it's the question is the quality of the M&A. If you have a high-quality M&A, which creates value, clearly, that would be the preferred way to go. If that doesn't appear, then it's the higher payouts.

The next question is from the line of Mehmet Sevim with JPMorgan.

I have just a couple of questions from my side. One on the NIM outlook. You're assuming a notable increase in NIMs through 2028. And I see that you're using also an assumption of a higher Euribor about 40 basis points average. I just wanted to check why that's the case? And secondly, how would this outlook change if Euribor were to stay flat and basically no changes in the outlook there? And would you expect NIM to decline? Or would you expect it to remain stable?

And my second question is on the payout. Now obviously, it is higher than expected initially and that you've guided previously with the EUR 300 million special distribution. But at the same time, you have now issued an AT1 of EUR 500 million. So if I look at it, it seems like you haven't really decreased your total capital position. You've just replaced one with the other, at least partially. So can I ask what your thinking is when it comes to this?

Now I understand your 16% or below CET1 guidance. But are you still quite conservative for the time being? And what's the rationale otherwise behind the AT1 issuance that you've done earlier this year? And maybe finally, the AT1 issuance as of the first quarter, will it bring down your target CET1 from 14% to 13%, given now that you've done it?

Okay. Let me start from the NIM question. So just to clarify on the Euribor outlook, you use, I think, the graph on Slide 20, which has one decimal. Actually, our outlook for Euribor from '26 onwards is up in the area of 30 basis points. So a point to make there.

Clearly, the dynamics for NIM and NII going forward, starting with 2026, firstly have to do with -- the average Euribor expected to go down by about 25 basis points. But the tailwinds that we have from credit expansion, a slight increase in our debt securities and to a lesser effect, the improvement -- the further improvement of our deposit mix and deposit costs will support NIM, which is expected to marginally go down in '26.

And then given the full effect of the rate normalization ending in '26 with the average Euribor then picking up, we expect NIM to go up to over 290 basis points in 2028. And with regards to our NII sensitivity, our sensitivity is at EUR 35 million for every 25 basis points on an annualized basis. So that's the dynamics. With regards to the payout, yes, you are right that we've issued an AT1 at the beginning of February. Clearly, AT1 was an instrument that we haven't utilized so far.

The decision to issue an AT1 was in line of us optimizing our capital structure, especially at times of favorable spreads and base rate conditions. So that was one of the drivers. And the other was to strengthen our position in rating agency assessments, especially in the context of Moody's CMDI application as well. With regards to our internal core Tier 1 target, yes, we are conservative. But as Pavlos said, to the extent that we are -- we have started to utilize this instrument and to the extent that we will go to the full effect of our budget, then absolutely, that 14% will go below 13.5%...

The next question is from the line of Gabor Kemeny with Autonomous Research.

My first question would be on your capital deployment plans, please. You're below 16% CET1. Can you please clarify what payout assumption is that based on? Is it the ordinary? Or do you include anything above that? That's the first one. The EUR 300 million, would you have a preference here between cash dividends or buybacks? That's the other one.

And I would like to follow up finally on the NII outlook, which I believe is pretty backloaded. So low single digits in '26, 7% CAGR. Altogether, this implies more like 9% CAGR, I believe, more than 9% for '27 and '28. So just based on the rate sensitivity you mentioned, Christos, I'm not sure I would get to that sort of delta. So maybe you could elaborate a bit further. I believe you mentioned the securities income and some other drivers, which you expect to influence your NIM, please.

Let me take the buyback question for the EUR 300 million extraordinary. It will be solely buyback, okay? And it will be part of the -- it will be integrated into the normal buyback program that we have. Now the other 2, I'll let Christos.

With regards to capital deployment, I think we have a Slide 18, where we suggest that we expect to generate profitability of around 10 percentage points over the 3 years. We are going to use that through -- for growth in the area of 350 basis points. And then our intention, including the EUR 0.3 billion that we are expecting to use through share buybacks in 2026 to go down to less than 16%, which implies use of capital for distributions north of 9%. So that's how we view our capital deployment going forward.

And with regards to interest rates, I think I've implied that, yes, the growth in our NII in 2026 will be more modest compared to the outer years. That is solely affected by the fact that we expect Euribor -- the average Euribor to go down in 2026. So our guidance is for low single-digit growth of NII in 2026. And then, of course, it will accelerate so that we deliver the 7% CAGR that we are guiding in our pages.

And just to add on what Chris said about the capital deployment, you need to -- not to forget that there is an agreement for the regulatory overlay on the DTC of about 30% of the payout. So we think that as NBG, we are -- we have the capital depth to be able to handle the payouts that we're describing.

Just a small follow-up, please, on the capital deployment point. So you have the EUR 300 million in there, obviously, but no more special distributions for the next 2 years. Is that correct?

We don't define that in our waterfall. So any decisions for one-offs will be taken on an ad hoc basis every year when we update our business and capital plan.

The next question is from the line of Robert Brzoza with PKO BP Securities.

Just a couple of them, but really quickly. The EPS guidance for 2028, does it incorporate the potential impact of buybacks on the share count? That's number one. Number two, the custody loan-related verdict, if you treat it, say, retrospectively, do you see any impact from that? Going next, the NPL Stage 2 size, it did bump up a bit quarter-on-quarter. Should we observe it?

What are the trends here? And finally, your OpEx guidance of, if I'm not mistaken, 6% CAGR. Of course, you are starting from a very low base, low cost to income. But I'm just curious what's driving this? Is it more wages or still administrative and general spending?

Okay. So I have 4 questions noted. So the first one is pretty straightforward. Yes, our EPS of over 1.7% obviously take into account the buybacks that we'll execute. Your second question on the custody law, I think we will not differentiate from what you've heard yesterday from the other 2 Greek banks. While we still wait for the script of the law to become available, given that we've disposed nearly all our exposure to this perimeter, this is -- even if the law has a retrospective effect, we don't expect this to be of any issue to our bank.

With regards to the question on the Stage 2, you should not expect anything there. I think what we had this quarter, we had one account that was flagged as a significant increased credit risk, but there is no forbearance, any delays there. So we expect it to go back to Stage 1. So no trend there to be concerned of. And then your question on OpEx, I think we've tried to explain that in our remarks. Where we are spending money is investing in 2 things, in our technology. We've been doing that for the past 5 years.

And as a result, you see the effect of that in our depreciation. So while our capital expenditure in technology has peaked, we are still seeing the effects of that in our depreciation. So that's one line that is affecting, let's say, the growth in OpEx in the next 3 years. And the other one, as we repeated quarter after quarter, is our people.

We are investing in people, not just on wages, but also trying to increase productivity through schemes of variable remuneration. And also, we're trying to bring new talent to, let's say, fill in the gaps, given that it's a changing world, especially with regards to areas like technology and digital.

Don't underestimate also things like cloud licenses, which are also affecting our OpEx through G&A. But I have to reassure you that especially with regards to the line of admin expenses, we are very disciplined, and we don't overspend in that line. It's just staff cost and depreciation. We believe that the 6% is a fair growth rate given the growth that we envisage to achieve as well as the spending in technology that we've been doing for the past 5 years.

The next question is from the line of Ilija Novosselsky with Bank of America.

So I have one question on your NII assumptions with 4 components. Can you take me what do you bake in, in your estimates for, number one, the hedges. So do you expect that your hedges would be lower in the future? And do you expect that your NII sensitivity might increase as Euribor increases?

Number two, do you expect that there is going to be any NPEs that have become reperforming entering your balance sheet? Number three, I can see in your NII breakdown that deposit costs has picked up a bit by EUR 1 million in Q4. Do you expect that your deposit costs in the future -- in the next 3 years are going to be stable or down or up? And number four, can you tell me what do you expect for MREL expenses? So do you think that your MREL expenses should be higher in 2028 compared to 2025 or lower?

Okay. So let me start with the hedges. So clearly, it's a dynamic exercise. We've been repeating that every quarter. The way that we envisage rates to evolve in the future, the base assumption is that NMD hedges will go down gradually in the future. And with regards to your question on our sensitivity on NII, whether it will increase or go down, I would say that, that's mainly a subject of our balance sheet size.

Other than that, we are always trying to optimize and reduce our sensitivity as we go along. With regards to RPLs, the answer is no. We have not implemented in our business plan anything with regards to reperforming loans, either on our loan book or on our NII. We will only do that once we have a tangible transaction ahead of us. With regards to your question on the NII deposit cost pickup in Q4, that was, I think, EUR 1 million is a rounding, but it's solely volume-driven nothing else.

You've seen that our deposits picked up in Q4, and I think that's the reason for that. And with regards to the effect of our NMD hedges, Q3 versus Q4, we are at the same level. And lastly, on your question on MREL expenses. For us, the MREL instruments are something that will support the balance sheet growth going forward. So if you take out some opportunities we have for optimizing costs because of refinancings of existing MREL instruments towards the end of our business plan horizon, I think the expectation is that MREL costs, yes, will go up.

We have a follow-up question from Mehmet Sevim with JPMorgan.

I just wanted to ask one on the buyback. So I understand the EUR 300 million will be in the form of a buyback and then you have the other EUR 200 million in the form of a buyback. So basically, that is EUR 500 million announced for this year. Just wanted to confirm. And given that you're still running the buyback from last year, I think there is a residual amount left. And so far, the daily purchases are below EUR 1 million. So how comfortable are you that you can do that in the open market this year? Or is there maybe another methodology there?

Okay. So first of all, the current program is running well. I think it's approaching 80% to completion. So we're nearly there. And the new buyback programs will start after the AGM of April, so sometime in June, I suppose. And we are comfortable having looked at the numbers with our consultants that, yes, it's without new, let's say, methodologies, as you suggested, we'll be able to tackle this.

Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to Mr. Mylonas for any closing comments. Thank you.

Okay. Thank you all for joining us for this full year and fourth quarter financial results call. Any further questions you may have, we're on standby. And I guess we'll see you in London in the big conference that's occurring there in March. So thank you all, and see you soon.

Ladies and gentlemen, thank you for standing by. I am Jota, your Chorus Call operator. Welcome, and thank you for joining the National Bank of Greece conference call to present and discuss the third quarter 2025 financial results.

At this time, I would like to turn the conference over to Mr. Pavlos Mylonas, CEO of National Bank of Greece. Mr. Mylonas, you may now proceed.

Good morning, everyone. Welcome to our 9 months 2025 financial results call. I'm joined by Christos Christodoulou, Group CFO; Greg Papagrigoris, Group Head of IR. After my introductory remarks, Christos will go into more detail on our financial performance, and then we will turn to questions and answers.

Before we turn to our presentation on the 9-month financial results, let me briefly describe our operating environment, a key driver of our performance. Greece's economy remains on a superior growth trajectory, displaying resilience and adaptability in a highly uncertain external environment with geopolitics, protectionism and fiscal challenges in several countries to name just a few sources of uncertainty.

Moreover, I am confident that the positive momentum of the Greek economy will continue, reflecting both fiscal and monetary policy support and solid corporate and household fundamentals, leading to increasing fixed capital formation and buoyant exports on the one hand and healthy private consumption and demand for housing on the other. In fact, leading indicators are overwhelmingly aligned in this regard.

Let's turn briefly to the fundamentals of the corporate and household sectors, starting with corporate. Business turnover and profits remain on a steady upward trend with gross fixed capital formation, excluding construction, reaching an all-time high, indeed, near European levels, reflecting high capacity utilization rates in both services and industry as well as favorable credit conditions. Indeed, in the first 9 months of 2025, net credit to enterprises has expanded by about EUR 6 billion and is set to accelerate considerably into the fourth quarter, aided by positive seasonality.

As regards service and goods exports, tourism is on track to hit a new record high this year while goods exports have held up well despite external headwinds, evidencing the competitiveness of the Greek corporate sector.

Turning to households. Labor market conditions remain robust with rising employment supporting household income and consumption and the reduction in the unemployment rate to a 17-year low, boosting consumer confidence. Furthermore, real wages have surpassed pre-COVID levels and continue to grow.

Looking forward, an additional boost to activity will arise from the normalization of Greece's primary surplus from last year's 4.7% of GDP to an expected 3.6% in 2025 and a budgeted 2.8% in 2026, mainly through tax cuts to the middle class.

Furthermore, public spending through the RFNs and the public investment budget is expected to reach 6.5% of GDP in 2026, from nearly 6% this year with the related CapEx remaining close to all-time highs for the next couple of years. I believe the above described an economy with sound fundamentals, able to overcome external headwinds and result in GDP growth exceeding 2% for the next couple of years, thus requiring significant financing from the banking system.

Now let me turn to our financial results. Against the backdrop of sharp benchmark rate normalization, 200 basis points off from the peak and 150 basis points lower in average terms in the first 9 months of 2025, we continued to deliver a solid financial performance in line with our recently upgraded full year 2025 financial targets. Specifically, our profit after tax in the 9 months reached EUR 1 billion. And our return on tangible equity for the same period stood at 16.1% or 15.6% if we normalize for trading income. And if one adjusts for our large capital buffers, return on tangible equity increases to over 20%.

I would like to focus on 5 noteworthy points regarding our P&L. First, the NII was broadly flat quarter-on-quarter in Q3, and this quarter should be considered the trough with NII gradually picking up from the fourth quarter unless there's a further ECB rate cut. Key to the success has been the strong loan expansion combined with the reduction in our cost of funding.

As regards to the former and the second point I want to emphasize, our stock of loans has expanded by 12% year-on-year or EUR 1.8 billion since the beginning of the year.

Factoring in a strong pipeline of over EUR 2 billion of corporate disbursements, which have been approved and a good amount is expected to be disbursed by year-end as well as a sizable pipeline of not yet approved projects, we are confident that we will exceed our recently revised target for a net loan expansion of over EUR 2.5 billion for this year, moving closer to the EUR 3 billion mark rather than the EUR 2.5 billion mark.

Third point, fees. They turned in a strong performance despite the impact of state measures. A key driver was a successful distribution of investment products, resulting in continued mutual fund market share gains, executing effectively on our plan to increase fee income to support our core income overall as market rates decline.

The highlight in corporate fees is the increased sale of treasury products. An overall observation is that cross-sell efforts for both retail and corporate sides of the business has been steadily improving.

Fourth point, our costs, which reflect continued investment in human capital and our goal to be technological and digital leaders at a pan-European level.

Regarding the former, we are onboarding new talent as well as rewarding our people with remuneration to match productivity and to provide appropriate incentives. Regarding technology, investment reflects the depth, breadth and speed of change, including the replacement of our core banking system.

OpEx also reflects the delayed impact of inflation, the shift to cloud services, the extra burden from regulatory requirements and the care we take with cybersecurity and a tightening labor market for skilled services. Nevertheless, we're achieving a cost-to-income ratio in line with our guidance and one that remains at the low end of the European banking spectrum.

Finally, as regards to credit quality, our cost of risk comprising purely of credit risk charges stood at 41 basis points in the 9 months against a revised target of 45 basis points for the full year, reflecting extremely benign asset quality trends. Our goal in this area is to have prudently attained class-leading coverage ratios across stages while at the same time gradually normalize our cost of risk. On this front, there is clearly upside.

A few words on another competitive strength of NBG, our capital buffers. Our CET1 ratio reached 19% in September, up by 70 basis points year-to-date, the highest capital creation among our peers despite accumulating for a 60% payout.

It is important to remind the investment community of our strategy regarding this excess capital. First, it enhances our strategic optionality as regards to incremental organic growth, including participations in international syndicates in areas of our comparable expertise.

Second, it allows us to search for value-accretive opportunities. Third, it allows us to enhance distribution to our shareholders. In this context and in view of a sector-leading payout ratio in the domestic market of 6%, we are distributing EUR 200 million in the form of an interim dividend, again, the highest among Greek peers. The distribution will take place on November 14.

A final point, at the time of our full year 2025 results and following the completion of our business and capital plans, we will announce our final payout ratio.

Looking ahead, we are well positioned to build further on our strong momentum. Our focus remains on building the foundations for sustainable growth through continued investment in technology and human capital, enhancing the banking experience for our customers through digital transformation and building a stronger and more innovative bank for the future.

Our solid capital base, disciplined execution and clear strategic vision give us confidence in our ability to deliver continuous value for our shareholders, supporting Greece's energy transition, infrastructure development and innovation ecosystem.

With that, I would like to pass the floor to our Group CFO, Christos, who will provide additional insight to our financial performance before we turn to questions and answers.

Christos, over to you.

Thank you, Pavlos. Let me start with the key highlights of our profitability on Slide 13. Our profit after tax for the 9 months of 2025 reached nearly EUR 1 billion after having absorbed the bulk of benchmark rate normalization in our net interest income. This produced a return on tangible equity of 16.1% before adjusting for excess capital or 15.6% normalized for the strong trading gains in the first half of the year, boding well with our full year guidance of over 15%. This performance demonstrates the resilience of our top line to lower interest rates, underpinned by solid loan growth and the sustained momentum in fees. From an earnings per share perspective, we generated an EPS of EUR 1.4 on a normalized basis, aligning with our full year guidance.

Going into more detail on Slide 17. Our net interest income came in at EUR 527 million in the third quarter of the year from EUR 531 million in the previous quarter, with the 9-month NII standing at a solid EUR 1.6 billion, down 9.8% year-on-year, reflecting market interest rates moving lower by more than 150 basis points year-on-year.

Our net interest margin for the 9 months stood at 284 basis points, comfortably supporting our full year target of 280 basis points.

Encouragingly, net interest income in Q3 was only marginally lower quarter-on-quarter as rates normalization decelerated, likely denoting the trough, assuming market rates stabilized at current levels. Quarterly net interest income evolution was supported by the sustained loan growth, the ongoing repricing of our time deposits as well as by the positive contribution of deposit hedges.

As shown on Slide 19, term deposit yields dropped by 11 basis points quarter-on-quarter to 154 basis points, leading our total deposit cost to 29 basis points and the total funding cost to just 59 basis points, both at the lowest level in the Greek space.

As regards to fee income on Slide 22, year-on-year growth stood at 8% or 14%, excluding the negative impact from state measures on payments. Corporate fees were up by 13% year-on-year, led by lending fees increasing by 30% on the back of strong loan origination. Retail fees were also up by 11% year-on-year on a like-for-like basis, spearheaded by the strong momentum in investment products, up by an impressive 74% year-on-year, driven by strong mutual fund inflows and reflecting our successful cross-selling.

Notably, as shown on Slide 8, our market share in mutual funds increased by 3 percentage points year-on-year as time depositors continue to switch towards fee-generating mutual funds, driving our retail funds under management up by EUR 2.2 billion or 34% year-on-year to EUR 8.6 billion.

Moving to operating expenses on Slide 23. Costs were up by 6.5% year-on-year, normalizing for variable pay accruals in 2024, allowing for continued investment in human capital through the onboarding of new talent and skills as well as rewarding performance and productivity.

Our depreciation charge reflects our sector-leading investments in IT and digital infrastructure, including the replacement of our core banking system with nears completion, delivering multiple benefits in our efficiency, commercial effectiveness, customer experience and cyber-risk security.

Moving to G&A. This reflects higher customer experience-related costs and delayed impact from inflationary pressures. All in all, the resilience in our top line, along with our discipline in costs kept our 9-month cost-to-income ratio at low levels by European standards just over 33%, well within our full year guidance of circa 35%.

As regards credit risk, benign asset quality trends continued in the third quarter of the year. Our cost of risk dropped further to 37 basis points in Q3, reaffirming our strategy for gradual normalization and limited volatility while we maintained leading coverage levels across stages by European standards. Cost of risk for the 9 months of 2025 came in at 41 basis points, well inside our full year guidance of less than 45 basis points.

On Slide 15, our sector-leading capital position, a key comparative strength of NBG enhances our strategic optionality. In the 9 months, our strong profitability drove our core Tier 1 ratio to 19%, 70 basis points higher year-to-date post a payout accrual of 60%, implying a capital surplus of 500 basis points over our internal core Tier 1 capital target of 14%.

Similarly, our total capital ratio stood at 21.8% with our MREL ratio at 28.5%, 170 basis points above our MREL target of 26.8%.

Factoring in our strong capital generation in the 9 months, we are distributing an interim dividend of EUR 200 million on November 14, the highest in the domestic market. And as Pavlos mentioned earlier, we will be finalizing the payout level for 2025 with our full year financial results.

Now let me walk you through the highlights of our balance sheet summarized on Slide 14. Our performing loan book was up by a solid 12% year-on-year, up EUR 1.8 billion year-to-date. This strong performance reflects loan disbursements of EUR 5.7 billion during the first 9 months of the year, 10% higher year-on-year, mainly driven by corporates allocated across key sectors of the economy, including energy and renewables, infrastructure projects, hotels, shipping and transportation.

Loan origination dynamics were positive in the retail segments as well with disbursements up by 14% year-on-year to EUR 1.2 billion, driving retail performing exposures 3% higher year-on-year, putting an end to a long period of retail disintermediation as shown on Slide 18.

As regards to the fourth quarter of the year, our strong corporate pipeline of approved yet to be disbursed credit in excess of EUR 2 billion, coupled with additional credit coming in, are set to accelerate performing loan expansion considerably, allowing us to exceed our full year target for a loan expansion of over EUR 2.5 billion, moving closer to the EUR 3 billion mark.

That, along with positive dynamics on time deposit and repricing and mix will allow Q4 net interest income to edge higher quarter-on-quarter, assuming no further rate cuts. In any case, net interest income recovery will be more evident starting 2026.

On the liability side on Slide 19, deposit balances increased by EUR 1.4 billion year-on-year, mainly driven by deposit inflows in low-cost core deposits, up by EUR 1.8 billion year-on-year, leading to a positive mix effect with 81% of our deposits being core. Our class-leading liquidity and funding position, as shown on Slide 21, manifests in a liquidity coverage ratio of 249%, among the highest in Europe, complemented by a loan-to-deposit ratio of 64%, while our ample net cash position is set to fund increasing exposures in interest-bearing assets.

Turning to asset quality on Slides 24 to 26. Our group NPEs amounted to just EUR 0.9 billion, reflecting marginal NPE inflows, translating into an NPE ratio of 2.5%. Our leading coverage levels across stages comprise yet another strength of NBG's balance sheet.

Summing up, in the 9 months of 2025, we delivered a strong performance with net profit of nearly EUR 1 billion, equivalent to a return on tangible equity of 15.6% before adjusting for excess capital.

Looking into the last quarter of the year, we are set to deliver a set of results that comfortably fulfill our targets, putting the theme of lower interest rates behind us as we enter 2026. Leveraging this solid performance and the strength and resilience of our business model, we intend to continue on a disciplined and value-enhancing capital deployment path, balancing increased shareholder distributions with capturing growth opportunities, maintaining strategic optionality and positioning the bank for sustainable growth, greater innovation and long-term value creation.

And with that, I would like to open the floor for questions.

The first question comes from the line of Kemeny Gabor with Autonomous Research.

Two questions from me, please. Costs, I believe your recurring cost growth of 6.5% is towards the high end or just above the high end of the range you indicated in your midterm strategy. I would be interested to hear your thoughts on the trajectory from here. If there are any incremental spending -- if there's any incremental spending left on the core banking system or in turn, if you expect any savings from the new system to become visible?

And the other point on capital deployment, yes, 19% CET1 ratio, very strong. You are running with close to EUR 2 billion of excess capital by my estimate. So how long would you be willing to run with such very strong excess capital -- or ask the question differently, come Q4, the end of year results, would you consider any action beyond a slightly higher ordinary payout depending on your M&A pipeline?

Okay. Thanks for the questions. You're right on costs. It's on the high end of the range we gave. Q4 will probably be the same. Just keep in mind that 2025 was the first year, a long time, we didn't do a voluntary exit scheme. We plan to do so in early 2026. So that will offset some of these trends that you're seeing.

Capital deployment. In my remarks, I said that we will tell you any changes in our payout use of excess capital at that time. So please -- until then, there is no change to what we said.

The next question comes from the line of Novosselsky Ilija with Bank of America.

So two for me, please. So first, there seems to be a bit of a wave of bolt-on acquisitions within Greece. So some of your peers have been quite active in that space. So I just wanted to ask you, especially given that you have a large capital buffer, are you thinking in that direction? So do you think there are some meaningful targets? And if yes, what are you looking for?

And number two, if I look at Page #17, and I see your components of NII. So there's been two components of NII increases, which are, number one, your securities; and number two, your deposits, including your NMD hedges. So your securities portfolio, I see is now 28% of your assets. So do you have scope to increase it further? And how should we expect NII from securities to perform from here?

And two, your deposits, your term deposits, you stated the new production is at 120 basis points, and there's 16% of your domestic deposits total. So can we expect that you'll get much more benefit in 2026 as well?

Let me start with the first question. Christos will take the second. Bolt-on acquisitions, clearly, we're looking for value creation, not transactions for transaction's sake. So within the space of Greece that there are not that many potential. And I clearly will not talk about the bancassurance space, given what's going on there with us there. So within Greece, there isn't that much of a bolt-on acquisition that would require any meaningful capital requirement. Christos.

Okay. I'll take the second question, Ilija. So on NII. So first of all, let me repeat what I said in my remarks that we were happy to see a deceleration in the decrease of the NII reduction quarter-on-quarter, just EUR 4 million in absolute terms from Q2 to EUR 527 million.

Securities has been supporting our NII for a long time. So we are currently at around EUR 21 billion in terms of volumes. Opportunistically, we could be seeing to increase a bit more. But I would say if you want the ball figure, what you see currently of an NII from securities in the area of EUR 160 million is a good point of reference.

And with regards to deposits, we are enjoying on that front, an improvement in our NII costs. It's EUR 14 million improvement versus the previous quarter. It's about half and half from time deposit repricing and mix. And the other one is coming from our deposit hedges. So there is still some upside to be seen. You picked it nicely. Our new production is coming in at 120 basis points. So from the levels that we are here, which is a blended mix, of course, of also foreign time deposits as well, there is some upside to be seen in the next quarters and in 2026 as well.

The next question comes from the line of Butkov Mikhail with Goldman Sachs.

I have a question on provision releases in this quarter. I think based on page -- on one of the page in the appendices, yes, Page 45, you had likely a significant provision release this quarter. We calculate EUR 51 million on profit before tax basis in this quarter. Can you maybe elaborate on what this was related to? And also considering your high NPE coverage ratio of over 100% now, which is well above, I think, the averages in Europe?

Do you see scope for more provision releases in the next quarters, considering healthy asset quality position? And what is your strategy and policy related to that?

Okay. So on the first of your two questions on the provision releases. So what we had this quarter, we recognized a benefit from a sale of an NPE portfolio that we closed in Q3, Project Etalia, about EUR 200 million GBV of NPEs. That resulted in a result that was better than the provisions that we had accumulated. So that led to the release that you see, and we included in one-offs so that we don't create any volatility in our cost of risk. That's it.

On the second question with regards to our coverage levels. So yes, you see us strategically normalizing our cost of risk in an efficient and timely manner. There is upside, as the CEO said in his remarks, to be achieved there as well. What we are doing is we are trying to have high provision coverage, not only in our Stage 3 loans, which, as I said, are just below EUR 1 billion as we speak. We're trying to be prudent in our new generation of loans, and that's how we preserve this high level of coverages. But yes, the strategy is to lower our cost of risk going forward because the coverages that we enjoy can come a bit down.

And may I also follow up on your one-off cost in this quarter? Maybe could you unpack the key items there since you, I think, didn't release the detailed financial statements yet just for us to have the full color on what is included in that line?

Yes. As you can see, it's mostly 0. We don't have any deviation between profit before and after one-offs. The fact is that the benefit that we have from this NPE portfolio sale is effectively counter affected by the donation that we had for the Marietta Giannakou school donation, which is in the area of EUR 25 million. So that effectively cancel out the positives with the negatives.

The next question comes from the line of Demetriou Alex with Jefferies.

So just on NII, if we think about the asset side and lending yields, with rates now stabilizing, how much longer will it take the repricing lag to come through and we start to see stable loan yields? And just secondly, on the retail side, could you provide any color you're seeing on the mortgages and disbursements at the moment?

Okay. On the first question, while we believe that the trough quarter for NII is Q3, we have to say that there is still some repricing coming in from the lowering market rates, but that is counter affected by the loan growth. So I would say, assuming that the average Euribor will be some basis points lower in 2026, you will continue to see some pressure on the loan spreads going forward and the loan yields in general.

With regards to mortgages, we've been experiencing an increase in our disbursements. And given the fact that the repayments that we had to realize from the disbursements that we had in the early 2000s was effectively up the growth. For a few quarters in a row now, we've been seeing mortgages growing as a portfolio, and we expect that this is going to be the trend going forward as we are optimistic about the growth in this sector of retail.

The next question comes from the line of Garrido Luis with Bank of America Merrill Lynch.

Two questions from me, please. One, on your senior preferred debt. Is it reasonable to assume that the stack of senior preferred debt will increase meaningfully as you reduce your CET1 ratio towards your target? And if so, how quickly do you think that will happen?

And secondly, just to come back to the securities book and the growth in non-Greek government debt. Can you give a bit of color on what type of assets you've been investing in to fuel that growth? And what are the criteria that you think about when growing that book?

Okay. On the first question, as you may have seen from the presentation in the remarks, we are currently enjoying 170 basis points of excess versus our MREL target of 26.8%. Our MREL issuance plan has to do with two things. First of all, refinancing existing instruments and the second, obviously, supporting our growth. So the way that we use issuance of MREL instruments, senior preferred bonds going forward has to do with our capital deployment strategy to answer to your -- the second part of your first question. So that's to be seen in the following quarters and years.

On the securities book, we are quite prudent, I would say, in where we invest. So whatever is not Greek sovereign bonds, it's EU sovereign bonds. We are mostly positioned in held to maturity in terms of accounting recognition. And to the extent that we invest in shorter-term bonds like T-Bills, then we also accounting-wise, classify them under our head to collect and sell portfolio. But we don't have any exotic, let's say, bonds in our securities book.

The next question comes from the line of Boulougouris Alexandros with Euroxx Securities.

Just a quick question regarding the strong pipeline of disbursements you mentioned in the fourth quarter. Could you give us a bit more color? Is it -- I assume it's mostly large corporates, maybe a bit the sectors. You already mentioned about mortgages, a gradual improvement, but if you give us a bit more color on the corporate side?

Yes, I'll take that one. The loans that are approved and disbursing are mostly requiring construction and we disburse as the construction occurs. It's certainly mostly in the project finance space. Energy, various construction projects, building of hotels, hospitality, I think those are the ones that are ones that are taking more time to fully disburse the approved credits.

Okay. Is there any maybe color on how you see 2026 in terms of credit growth, I mean, similar trends as we are seeing in 2025 could continue?

Absolutely. Good question. I give a macro introduction every time because the bank does well when the macro is good. And the macro is very good. So I think that there will be continued investment. And in a bank-centered system like Greece, there will be loan growth, again, similar strong strength in the corporate. And there will be additional support coming from, as I mentioned earlier, and Christos has just mentioned from retail. So I think that 2026 will see similar strong growth -- very strong growth as we saw in 2025.

The next question comes from the line of Skhirtladze Salome with Bloomberg.

I have two questions on the IT expenses. As long as you are almost near end of your IT system upgrade, shall we expect lower IT-related spending next year? And how would you break down the major digital-related spending?

And on the assets under management side, if you could summarize your strategy, how you envision gaining market share in this space and whether the asset under management rising trend is pressuring the deposit growth or could pressure deposit growth going forward?

Okay. On the first question on the IT expenses. So first of all, as we said, the core banking system upgrade is coming to an end in the early months of 2026. So we've recognized the bulk of the burden from the IT expenses there. We see that we've reached, let's say, the peak of our IT expenses. But nevertheless, we should not underestimate the need for keeping up to standard with the technological advancements that are taking place. That includes cybersecurity, as the CEO said, AI as well and trying to find ways to improve customer experience and also be more efficient. So while we are disciplined on cost, we are trying to spend EUR if we can make EUR 3 out of this.

On the assets under management, we've been recognizing, as we said in our remarks, about 3 percentage points of market share increase as we speak. We have been revamping our offering as well as our operating model. We are also making investments in terms of our digital offering in AUMs. And despite the fact that we've been transitioning a lot of our time depositors to mutual funds, we still see a growth in our deposit franchise.

To give you some more color with regards to our AUM flows, about 90% of the flows have to do with pure net flows. 55% of that is from our own depositors and the rest are from the market and about 10% from growth comes from revaluation. So the strategy is paying off, and we'll continue on that front as well.

And I think it's also important to note that in terms of the core savings franchise for retail, that has not been affected by this strategy on mutual funds.

The next question comes from the line Nigro Alberto with Mediobanca.

One quick one on potential capital allocation. What do you think about Cyprus and if you see some opportunities there? And the second one, what kind of bancassurance reorganization you are thinking going forward?

Clearly, on the second question, you'll have to wait. We are in a situation right now where we cannot discuss bancassurance, as you can well imagine. And also on Cyprus, I think there's no comment to be made on that either.

Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to Mr. Mylonas for any closing comments. Thank you.

Thank you all for joining us for the call. I think there's a trip to London to meet investors in the next few weeks. So we look forward to meeting you in person and having further conversations. So thank you very much for joining us, and we are available for questions or clarification that you may have.