Vassilis Psaltis (Alpha Bank): As a Bank and as a nation we have turned page by drawing a clear path towards development

‘ The year of strong performance for it ” was described in 2023 by Alpha Bank CEO Vassilis Psaltis, adding that “in the last 12 months we improved our profitability while maintaining discipline in costs, ensuring a stronger balance sheet and allowing healthy capital creation. The CEO of Alpha Bank stressed that “We achieved this by focusing with determination on the creation of sustainable value for our shareholders and we are proud that we formed the conditions to propose the restart of dividend payments from the profits of 2023”. He continued commenting on the macroeconomic environment, he referred to the prospects presented by the Greek economy, which developed significantly faster than the Eurozone average in 2023, expressing his optimism that “this trend will continue until 2025”. He even stressed that “Greece’s return to the investment level highlighted the remarkable recovery of investor confidence in the Greek economy. The landmark agreement and our strategic cooperation with UniCredit, constitutes our own evidence in the process of transforming the Greek economy.” “As a Bank, and as a nation, we have turned a page, drawing a clear path towards development,” he concluded in his statement. Profitability record for the fourth quarter The highest profitability (RoTE 14.3%) for the 2023 achieved by Alpha Bank in the fourth quarter, pushing the overall profitability of the year to 12.9% and surpassing the initial management estimates by 4 percentage points. At the same time, the Bank achieved, and in many cases exceeded, its initial targets for 2023, with Profits per Share (EPS) being set at 0.32, from 0.23 euros that was the initial estimate, increased by 91% compared to 2022. The strong economic results also allowed the Administration to announce even more ambitious profitability targets for the coming years, however, taking conservative assumptions as to the course of interest rates. In particular, according to the management estimates, RoTE is expected to reach 14% and EPS at 0.35 euros in 2026, while it is estimated that surplus funds will exceed 1.5 billion euros. The Bank’s ability to significantly increase its profitability in combination with the balance sheet support, as reflected in the further reduction of Unperforming Loans to less than 6% and the capital increase by 237 basis points, consolidate the Bank’s return to normality and pave the way for the return of value to shareholders. In particular, the Administration plans to distribute 20% of the profits for 2023, aiming to increase this percentage over the next few years, distributing more than 1 billion euros in dividends in the 3 years 2024-26, subject to SSM’s agreement. At the same time, the Group’s surplus liquidity, with the Loan to Deposit Index (LDR) being formed at 75%, puts the organization in the right position to further support the country’s development progress. The FL CET1 funds amounted to 15.9%, taking into account the positive impact on Risk-weighted Asset Elements (RWAs) estimated to result from MEA transactions, increased by 3.4 percentage points compared to 2022 and almost 2 a.m. higher than the initial management guidance. The high profitability achieved by the Bank also led to a significant increase in the Group’s Equity Net Position, which was set at 6.4 billion euros, higher than the initial estimates of the Management. It is worth noting that strengthening the Instrumental Clean Position brings even closer to the goal set by the Administration for 2025 at the June Investor Day, abstaining only 9%. The net interest income is expected to be held high – the diversification of income is reinforced, a determining factor in increasing the Bank’s profitability was the growth of 41% of net interest income, with the Net Profit Margin (NIM) becoming 2.2%. In its presentation the Bank estimates that in 2026 net interest income will be 5% higher than 2023 levels. In this regard, the Bank will be able to strengthen: the expected increase in the loan portfolio, the appreciation of the securities portfolio, mainly thanks to the maturation of bonds of EUR 4.5 billion in 2024 – 2026, with the funds reinvesting in higher return securities, the reduction in the cost of financing resulting from the reduction of interest rates expected from the second half of 2024 and the revenue arising from the position taken early by the Bank in derivatives to offset the cost of reducing interest rates. Major progress has been made by the Bank in diversifying its revenue, with Revenue from Supplies increased in the fourth quarter by 8%, representing 18% of its revenue. A decisive role in this direction was played by the increase noted by the Assets under management (AuMs) which increased by 49% (+ 1.3 billion euros), as a result of the 8 new investment products introduced by Alpha Bank in 2023, bringing the Bank back to first place in Mutual Funds with 30% market share. The Bank continues to see the dynamic rise in Revenue from Supplies, which is expected to be set at 470m euros in 2026, representing 20% of total revenue. At 1.1 billion euros the net credit expansion in 2023 of a record expansion of 1.1 billion euros achieved by the Bank in the fourth quarter, thanks to a reduction in the rate of repayment of loans, but mainly thanks to the dynamics of disbursements of 2.8 billion euros, with the largest increase (+3%) in 2023. Engines of this significant credit expansion achieved by the Bank were Wholesale Banking, where Alpha Bank has established its leading position in important sectors such as tourism, with a portfolio of almost EUR 3 billion, but also Shipping with a portfolio of EUR 3.1 billion. Continuous de-escalation of ACEs – less than 4% the Index in 2025 A Scouts continued the consolidation of the Bank’s balance sheet, with Non-Servable Exposures (MEAs) decreasing at a faster rate than expected and eventually becoming 5.8%, while the coverage of ACEs increased by 7 percentage points, reaching 47%. In addition, low ACE inputs, the durability of ACEs with less than 90 days of delay, allowing for a head-up reduction in ACEs, are to lead to a further reduction in ACE Index below 4% in 2025. A significant improvement is estimated to also mark the ACE Covering Index, which is expected to be 50% in 2024 and 60% in 2026, leading to the Cost of Risk at around 75 p.b. and 65 p.b. respectively.