Hellenic Bank reports €189 million profit for first six months of 2024, an 18% increase YoY

“Hellenic Bank’s performance for the first half of 2024 was solid. Profit after tax totalled €189 million, mainly due to higher interest income,” Antonis Rouvas, the Hellenic Bank Group’s Interim Chief Executive Officer has stated, commenting on the Group’s financial results for the six-month period ended 30 June 2024.

Rouvas continued, “This performance demonstrates the resilience and robustness of our business model, despite the continuing challenges and uncertainty rising from the geopolitical and economic environment.”

As noted by the Interim CEO, net interest income for the first half of 2024 reached €304 million, up 29% YoY, while non-interest income amounted to €57 million.

“With a pro forma total Capital Ratio of 32,2%, well above the regulatory requirements, and ample liquidity (Liquidity Coverage Ratio of 517%), we are well positioned and fully committed to continue supporting our customers. New lending during the first half of 2024 reached €472 million, as we continue providing competitive, tailor-made credit products,” Rouvas said, before continuing, “At the same time, we remain watchful of potential risks that could adversely affect the Bank's performance, due to the challenging economic and operational environment and elevated geopolitical risks.”

As noted by the Interim CEO, further reduction of the NPE ratio remains a priority for the Hellenic Bank Group.

“In July 2024 we signed a Sales and Purchase Agreement with CNP Assurances to acquire its subsidiary CNP Cyprus Insurance Holdings Limited, operating in Cyprus and Greece. This will allow the Bank to significantly strengthen its insurance operations and become a leading financial services group with a strong presence in the financial and insurance sectors in Cyprus. Upon completion, Hellenic Bank is expected to have a leading position in the insurance market in Cyprus,” he stated.

“At the same time,” Rouvas continued, “we managed to overcome a long-lasting issue with (bank employee union) ETYK by agreeing on a framework for the renewal of the collective agreement. This will allow us to focus on delivering our strategic plan together with our Bank’s transformation plan, prioritising customer-centricity and accelerating digital transformation.”

Rouvas also looked to the Groups future noting, “Moreover, the decision of Eurobank, one of the largest financial organizations in Greece to invest in Hellenic Bank, constitutes a vote of confidence in our business model and franchise and as a result in our country’s economy. With the successful conclusion of the mandatory takeover bid procedure leading to a total direct participation of 55,9% a new era starts for Hellenic Bank.”

“The significant strengthening of the Bank’s fundamentals has been recognised by major credit rating agencies,” he continued, elaborating, “In July 2024 Fitch Ratings upgraded the Bank’s Issuer Default Ratings to an investment grade rating of BBB-, while in June 2024 Moody’s Ratings initiated a review for a possible upgrade of the Bank’s ratings.”

Rouvas went on to talk about the Group’s approach to ESG, saying, “Our strong commitment towards corporate responsibility, sustainability, and green growth is reflected in the revised ESG Strategy, which became integral part of the Bank's Strategic Plan, incorporating specific objectives at all levels of our operations. Our goal is to further enhance our loan book through healthy and sustainable growth with a strong focus on ESG. The Bank's Annual ESG Impact Report for 2023 was recently published incorporating our pledge and efforts for a more sustainable economy.”

Key highlights from the Group’s financial results for the six-month period ended 30 June 2024:

• 6M 2024 profit of €189 million, increased by 18% YoY
• Solid Capital Position: Pro forma CET1 ratio of 26,55% and pro forma Total Capital ratio of 32.19%, well above minimum regulatory requirements
• De-risked balance sheet: NPE (excluding the NPEs covered by the APS agreement) ratio at 2,4% with NPE provision coverage at (excluding the NPEs covered by the APS agreement) 39%
• Agreement with CNP Assurances on CNP Cyprus Insurance Holdings to create the largest insurance operator in Cyprus
• Framework agreement for the renewal of the staff collective agreement
• 6M2024 new lending of €472 million
• Retail focused, with a solid customer base and major market shares in households (36% in deposits and 33% in loans)
• Following the completion of the mandatory takeover bid, Eurobank becomes majority shareholder with a 56% stake
• 6M2024 Net interest income of €304 million, up by 29% YoY, benefitting from high interest rates and liquid balance sheet
• 99.7% of new lending exposures post 2018 are performing
• 6M2024 Cost to income ratio Adjusted for the Deposit Guarantee Scheme contribution, Special Levy and Transformation costs) of 35%
• Ample liquidity, with an LCR of 517% and with €5.3 billion placed at the ECB, benefiting the Bank from current interest rates
• Net loans to deposits ratio of 39.8% on 30th June 2024, enabling further business expansion.