Greek banks are turning the page, as the cycle of recapitalizations in the Greek banking system closes.
The banks are moving to the private sector, as there remains on the one hand the sale of the 18% of National Bank owned by the HFSF, which is planned to take place in the summer, and on the other a percentage of around 70% to Attica Bank.
At the same time, the banking sector is entering a period with the prospect of serious profitability and with the promise of a dividend after more than a decade.
The improved resilience of the banking sector, the good performance of the Greek economy and the recovery of investment grade have led to an increase in investment sentiment, allowing the HFSF to almost complete its divestment from systemic banks
The performance of Greek banks attracts high investment interest, with the systemic banks being a “magnet” for international investment funds, having collected offers of more than 25 billion euros through the disinvestment process, but also through bond issues.
The placements in Ethniki and Piraeus gathered the high interest of the international investment community, giving a “vote of confidence” to the Greek banking system and the Greek economy in general.
The success of the sale of the percentage of shares of the HFSF (27%) of Piraeus can now be recorded as a reference point for both Greek and European data.
The total amount collected in the international and Greek book amounted to a total of 10.7 billion. and indeed in the maximum price range of 4 euros.
At the same time, the largest privatization in history is recorded through a secondary placement with the amount of the price reaching 1.35 billion euros.
In the case of Ethniki, the divestment of 22% of the HFSF collected 8 billion with the total price amounting to 1.067 billion.
The successful cycle of disinvestment of the HFSF from the systemic banks started with Eurobank and Alpha Bank.
Eurobank bought 1.4% of HFSF’s participation at a price of 1.80 euros per share, with HFSF’s total gross proceeds from the transaction amounting to 93.7 million.
Alpha Bank became the second bank to be fully privatized, as the HFSF accepted the one and only offer, that of UniCredit for the purchase of approximately 9% for 293.48 million.
The increased interest of foreign portfolios in Greek banks is also reflected by their strong presence in their latest bond issues.
The exit of Ethniki to the markets through the issuance of a 5-year senior preferred bond gathered offers of more than 2.4 billion from more than 200 investors, exceeding by more than 4 times the amount of the issue.
The Piraeus issue (10-year Tier 2 bond) was oversubscribed more than three times having raised over 1.8 billion in capital with the participation of more than 145 institutional investors.
The Eurobank 10-year bond auction was also completed with significant oversubscription, by 6 times, while the bids reached 1.8 billion.
The sizes of 2023
The net profits of the four systemic banks in 2023 amounted to 3.645 billion euros, down 2.38% on an annual basis.
In 2022 the profitability of the four systemic banks was 3.734 billion euros, after taxes, against losses of 4.8 billion euros in 2022.
Ethniki presented in 2023 net profits of 1.106 billion from 1.120 in 2022, Alpha Bank profits of 611.3 million (+65.9%), Eurobank 1.140 billion euros from 1.347 billion and Piraeus profits of 788 million from 899 million in 2022.
The four systemic banks in 2023 presented net interest income of 8.093 billion euros, 2.717 billion euros more than the 2022 fiscal year (+50.54%).
Ethniki achieved net interest income of 2.263 billion (+65%), Piraeus 2.003 billion (+48.04%), Eurobank 2.174 billion (+46.09%) and Alpha Bank 1.653 billion euros ( +40.9%).
At the same time, net commission income for the four banks amounted to 1.845 billion euros from 1.715 billion in the previous year (+7.58%).
Banks continued to reduce the ratio of non-performing exposures (NPEs) in the previous year.
As for the NPEs ratio, National Bank reduced the ratio to 3.7% of loans from 5.2% in 2022, Eurobank to 3.5%, from 5.2%, Piraeus to 3.5% from 6 .8% and Alpha Bank to 6.0% from 7.8%.
The dividends
Banks are now able to reward their shareholders by announcing that they will proceed with a dividend distribution after more than a decade, if given the green light by the SSM, which is expected to happen in April.
Eurobank CEO Fokion Karavias estimated a dividend distribution of around 9 cents per share and a distribution of at least 25% of 2023 profits.
The CEO of Alpha Bank, Vasilis Psaltis announced the distribution of a dividend of 25% on average on an annual basis in the period 2024-2026, while for the current year he reiterated the commitment to distribute 5 cents per share from the profits (20%) of 2023 under subject to the approval of the Supervisor.
In Piraeus, the management “sees” a dividend distribution of 10% of the profits of 2023, 25% of the profits of 2024 and 50% of the profits of 2025 and 2026, while Ethniki will ask the Supervisor for the approval of a dividend of 25- 30% of 2023 profits.
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