Alpha Bank Sa

Ladies and gentlemen, thank you for standing by. I am Yoda Yokoro's call operator. Welcome and thank you for joining the Alphabank conference call to present and discuss the nine-month 2025 financial results. All participants will be in a listen-only mode and the conference is being recorded. The presentation will be followed by a question-and-answer session. Should anyone need assistance during the conference call, you may signal an operator by pressing star and zero on your telephone. At this time, I would like to turn the conference over to Alfa Bank management. Gentlemen, you may now proceed.

Hello, everyone, and welcome to the presentation of our third quarter results. I'm Iasson Kepapsovlu, Alfa Bank's Head of Investor Relations. Our CEO, Vassilis Psaltis, will lead the call with a usual summary and a few updates. Our CFO, Vassilis Kosmas, will then go through this quarter's numbers in some detail. 20 will come at the end, and we should wrap up within the hour. Vasilis, over to you.

Good morning, everyone, and thank you for joining our call. Let's start with the usual overview of financial results on slide four, please. As you can see, reported profits for the nine months stood at $704 million, already more than what we have made in the preceding fiscal years. Earnings per share of 27 cents are 73% of the target we have set for the year. This translates into a 13.9% normalized return on tangible equity. We've also accrued $352 million for distribution so far this year, already more than the distributions out of 2024 profits, and we intend to distribute circa $111 million as an interim cash dividend in about a month's time. The main pillars of our performance remain the same. We have defended against the fall of the interest rates, seeing the second quarter of sequential NII growth. We recognize that the decline in interest rates will come less relevant in the coming quarters, but our ability to prudently position the balance sheet to maximize the value we can extract will remain relevant, be it on policy rates or spreads. We see structural tailwinds to our fee income line coming from asset and wealth management alongside lending and transaction banking. Fee income growth is the product of the initiatives we have taken that are now bearing fruit, both on the corporate as well as the affluent side of the business. We continue to position the business to maximize the recurring value we can create for our stakeholders in a sustainable way. Now, allow me to spend some time on the strategic outlook. starting with slide five. Our strategic partnership with Unicredit continues to be a cornerstone of our transformation and growth agenda. As of last week, Unicredit has increased its stake in Alphabank to circa 30%, reinforcing the depth and commitment of our partnership. This is not just a financial investment. As Unicredit CEO, Andrea Orcel, has repeatedly stated, it's a strategic partnership delivering tangible, commercial, operational, and systemic benefits for both institutions. We've cooperated closely and successfully combined our Romanian subsidiaries in a record timeframe, creating a stronger regional footprint and unlocking synergies in cross-border operations. Furthermore, our clients now benefit from Unicredit on European network across 13 countries. This uniquely positions Alphabank as a gateway to Europe and the bank of choice for over 5,000 wholesale clients in Greece. In wealth and asset management, the launch and expansion of the OneMarket fund suite has been a major success with close to 900 million distributed to our customers. In wholesale banking, we have collected over 300 million in letters of credit and guarantees throughout transaction banking business and approved circa half a billion in international syndicated lending since the partnership began. Initially, bilateral FX payment volumes have reached 650 million year-to-date, reflecting strong transactional momentum. In capital markets and advisory, the integration of our investment banking platform is progressing well. Together with Unicredit's advisory franchise, we're targeting joint-deal origination across various sectors. Lastly, beyond commercial gains, we are also leveraging Unicredit's expertise in customer experience, process simplification, upskilling and reskilling programs, compliance, and operational resilience, areas that are crucial to our long-term sustainability. This partnership aligns with Europe's vision for cross-border integration and financial stability. It supports the capital market union and enhances systemic resilience across Europe. Looking ahead, we aim to scale further our syndicated lending, transaction banking, and cross-border advisory, and broaden the distribution of asset management products across Unicredit's network. Our partnership with Unicredit gives us a competitive advantage that differentiates us from the rest of the pack, one that we aim to fully utilize to enhance the value that we can create for the benefit of all of our stakeholders. Our story remains intact, as you can see on slide six. Our strategic actions, alongside our balance sheet tactical positioning, will allow us to maintain an upward trajectory to our bottom line. Our defensive net interest income profile is now evident, as we are amongst the first commercial banks in Europe to see growth in their net interest income line. We continue to dynamically manage our balance sheet, capturing the tailwinds of long growth. The structural growth potential of the regions where we operate will allow us to maintain a pace of net credit expansion above the 2 billion mark. We are stepping up our efforts for incremental fee income generation. Our franchise is strongly positioned to benefit from the long-term uplift in the penetration of fee-generating services. And as mentioned above, we are leveraging the partnership with Unicredit to accrue tangible benefits quarter after quarter. Our profitability is thus on an upward path and we see earnings growing by 12% beyond 2025, still notwithstanding the impact of any share buybacks. Let's now move to slide seven, please. The trends for 2025 and beyond allow us to maintain a differentiating positive EPS growth trajectory in the medium term. This differentiation should now be apparent vis-a-vis our domestic and European peers. EPS is expected to grow by 10% per annum over the planning period, above consensus estimates, even before accounting for the effect of any buybacks. And then on slide eight, please. We have been diligent and clear on how we intend to allocate capital, and our hierarchy remains unchanged. Our first and foremost priority is to fund profitable loan growth and invest in bolstering our capabilities. Our capital generation capacity suggests that we ought to be increasing payout. Lastly, our excess capital provides us with significant firepower to do more. Allow me to provide you with an update on these priorities, starting with loan growth on slide nine. Loan growth in Greece continued to show resilience, with corporate lending continued to lead the way. We are seeing sustained momentum driven by a combination of strong economic fundamentals, a robust investment cycle, and the structural support mechanism in place. Businesses are actively engaging with the banking sector to finance expansion, transformation, and innovation. reflecting a deeper shift in the corporate landscape. We expect this dynamic to persist, fueling high single-digit growth for corporates. The mortgage market presents a more complex picture. Demand is evident, but structural constraints around supply and legacy portfolio dynamics continue to weigh on growth. Government support measures offer some relief, and growth is now turning positive. As a result, lending to individuals will be a growth area in the coming years. We're operating in an environment of hate and competition, particularly in the large corporate segment, which has led to gradual compression and spreads. We're actively defending profitability through prudent underwriting, optimizing risk-weighted assets, and increasing fee and commission income. The commercial book remains resilient, and we are confident in our ability to navigate these dynamics effectively. Overall, the outlook remains constructive. corporate lending will continue to be the engine of growth, supported by a recovering economy and targeted investment flows. Whilst mortgage activity may be slow in picking up, the broader loan book is well positioned to deliver on our expectations. We remain confident in our guidance and continue to expect mid to high single-digit growth over the medium term. On slide 10, you can see the revenue benefits from the investments we have made in growing parts of our core business. Beyond balance sheet growth, we have made important strides in diversifying our revenue streams and enhancing our cross-selling capabilities, which is a key pillar of our medium-term growth strategy. Trade finance and overall transaction banking fees have seen strong growth, achieving an 8% CAGR boosted by our internal efforts to deepen our share of wallet with clients and also thanks to our partnership with New Credit and the larger product palette that they are now able to offer us to our corporate customers. In asset management, fees and assets under management have both doubled since December 2022, with over 60% of this growth coming from net new money, complemented by positive market effect. The former highlights our growing distribution capabilities, capitalizing on our affluent and wealthy clientele, whilst the latter demonstrates the outperformance of our products. Mutual funds have taken the lion's share of this growth, with net sales accounting for 75% of the total growth and a continuing bias towards balance and equity funds. These are products that carry higher management fee margins, helping our fee category and asset management reach an impressive 32% since the first quarter of 23. The outlook for these two areas remains very constructive. Our corporate customers, they are increasingly more sophisticated, and their needs are expanding beyond plain vanilla lending. As such, we aim to support them in their growth journey through an expanded palette of transaction banking, trade finance, treasury, and advisory product, the latter with our new, larger business following the acquisition of Axia Ventures. In asset management, Greece is at early stages of a new secular trend. with rising disposable incomes and improving financial literacy among affluent customers, creating long-term tailwinds for AUM growth. Moving on to slide 11. Shareholder remuneration has been on a consistent upward trajectory, reflecting both our strong capital generation capacity and our commitment to sustainable value creation. We reiterated dividends with it, We started again paying dividends with a 20% payout ratio, increased this to 43% of reported profits last year, and we are currently accruing at 50% for 2025. This progression underscores our confidence in the robustness of our capital position and our ability to support higher distributions going forward. Indeed, our capital generation capacity suggests that the payout north of 50% is sustainable, aligning with our strategic objective to deliver predictable and growing returns to our shareholders. Ash dividends have followed a similar upward path, starting with $61 million out of 2023 profits and rising to $70 million for 2024. For the current year, the introduction of an interim dividend of $111 million to be paid in the fourth quarter confirms the positive momentum in our disciplined approach to capital deployments. Now, when it comes to the split between cash dividends and share buybacks, our approach remains balanced and responsive to market conditions. While cash dividends provide immediate and tangible returns, buybacks offer flexibility and accretive value, particularly in periods of market dislocation. We continue to assess the optimal mix guided by our capital planning framework and our overarching goal of enhancing total shareholder return cognizant of the change in the return of investment or future buybacks. Let's now move to M&A and start with slide 12, please. We view M&A as a powerful tool that can accelerate the delivery of our strategy. The three transactions we announced earlier this year, FlexFin, Astro Bank, and Axia Ventures, they are fully aligned with our framework. FlexFin enhances our factoring capabilities and opens access underserved SME segments. Astrobank consolidates our systemic presence in Cyprus, doubling its profitability. Axia Ventures strengthens our advisory offering, elevating our dialogue with corporate clients with additional focus on cross-border capabilities in conjunction with our unit credit partnership. Moving on to slide 13. As we have stated clearly, The financial impact of these transactions with a total 6% accretion to EPS and 60 basis points benefit to profitability in terms of return on time of equity at the cost of circa 60 basis points of capital. Integration efforts are already underway and we're working to work full rollout in line with our strategic roadmap. To ensure seamless execution, we have appointed a dedicated chief of integration and group initiatives officer who oversees all aspects of delivery and sits on the executive committee. This governance structure ensures strategic alignment, operational discipline, and timely execution. We will continue to pursue opportunities that fit our framework and deliver long-term value to our clients and shareholders. And then finally, from my side, I'm pleased to announce that we are planning to host an investor day in the second quarter of 2026. We're close to the end of the period covered by our last event, held in June 2023, so we believe it is time to update the market on the progress we have made across the group and explain our strategic priorities going forward. Planning is already underway, and we will be sharing more details in the coming months. At the four-year result stage, you should expect to receive guidance for 2026, but with a three-year business plan subsequently unveiled during the investor day. And with that, Vasile, the floor is yours.

Thank you, Vasile. Hello to everyone from my side as well. Let's start with P&L on slide 16, please. Quite quarterly in terms of one of items this time, we've had the 25 million euro well-publicized donation to the Marietta Janak program for the reconstruction of schools, as well as a huge transformation in NP transaction related costs. As you can see, Trading and other income was also particularly low this quarter, mainly stemming from the liability management exercise we did on our tier two note back in July. That had a 12 million euro impact. As a result, our reported profit is a bit lower this quarter, while on a normalized basis, we're still cruising comfortably above the 200 billion line. Obviously, these do have implications for the full year guidance. Overall, we still expect to beat our original guidance of 850 million Euro in reported profits by a bit over 5%. We're still looking at 2.2 billion of revenues, north of 1.6 billion in NII and north of 460 million in fees. Costs are still expected to be contained at 870 million. We're tracking very well against the improved cost of risk guidance 45 basis points. Assertive income would likely come in at 30 million. Tax, excluding the one of PTA recognition should run about 26%. And finally, in terms of WANOS, we're likely gonna have a couple of negatives in Q4, bringing the total for the year to positive 30 million. All in, that should give a normalized EPS of 35 cents in line with the consensus. With that, let's move to the next slide and talk about the underlying results and the main P&L items. Both net interest income and fees are growing sequentially, so the underlying core revenue picture remains solid. Operating income was down 5% Q&Q, solely attributable to trading, where, as mentioned, this quarter we had a loss on the LME. Costs at $214 million were flat versus the previous quarter, and we're still trading better than expected. We expect a significant uptake in the fourth quarter on account of some seasonality, typical towards year end, and thus retain the full year guidance of circa 870 million euro. Impairments came in at 45 million euro for the quarter, bringing cost of risk at 45 base points, in line with guidance, and reflecting a benign credit environment. Finally, on the bottom line, Reported profit after tax was down 36% as we had a large positive one-off in the previous quarter and a small negative this time. Normalized stood at 217 million, almost flat Q and Q. So I still feel very comfortable with the full year guidance. Next slide on the main balance items. Performing loans are up 2% in the quarter and a 13% jump from last year. Customer funds are also up 4% in the quarter with a year-on-year increase of 9%. Tangible book value up 1.3% in the quarter on goodwill recognition with the annual growth rate of 13% after adjusting for dividends. And then capital with standard 15.7% in terms of fully loaded CP1. But as you might remember, we will have a 60 base point headwind in Q4, a full completion of Astro Bank, already completed, and Axion. Let's move to slide 19, where we discuss the two main components of revenue. NII was up for one more quarter, continuing the upward trajectory. At 42 million, we're still seeing the impact of rate declines, and to a lesser extent, the dollar depreciation. On the commercial side, with average rates still down in the quarter, we're seeing a lower contribution from loans. Even though rates appear to have stabilized, the large effect of repricing means that we'll still have a headwind going into Q4. Deposits and finding costs continue to improve, although the pace of rates decline means that time deposit pass-through are more elevated than expected. With rates now hopefully at the trough, we should see some improvement in time deposit spreads. On the non-commercial side, securities books haven't grown, so there's no material improvement this quarter. On the fee and commission side, we saw a small decline in the quarter. If we exclude the gain from the one scheme partnership with Visa in the previous quarter, third quarter was obviously up 7% on a comparative basis. Yet another quarter, the star performer was asset management at 32 million euro. They were already currently running double the run rate of the 2022-24 three-year average. Business credit fees came up 33 million, up 2.3% versus the second quarter. Fees from cards and payments are seasonally strong in the third quarter. fees are up 10% versus the same quarter last year, and even more if we adjust for the government initiatives, reinforcing the guidance we have given you for the year. Now let's move to slide 20 to look at loans and customer funds. Performing loan balances reached 35.7 billion euros with some 700 million of net credit expansion in the quarter. Another strong quarter with 3 billion disbursements and similar patterns above. Corporates, including SMEs, driving growth evenly spread across sectors. Some small contribution from retail, around about 50 million. Year-to-date, net credit expansion has now reached 2.2 billion euros, while once we account for the negative effects from the weaker dollar and the asset quality flows, performing balances are up 1.6 billion. Net credit expansion is tracking better than expected, and the repayment of a large, circa 300 million corporate exposure we were expecting in Q3 has yet to occur. This repayment has now been rolled into Q4, so do take that into account when forming your estimates. Spreads continue to be under pressure, but we remain disciplined in our underwriting criteria. Such, we will avoid deals or refinancing that do not meet our own credit criteria and are not accretive for shareholders. Turning to customer funds, another quarter of solid growth, with circa 1.6 billion of growth in deposits, almost entirely coming from domestic corporates. Please note that about half a billion relates to bond placement that we led at the end of the quarter, which has quickly reversed in Q4. On NUMs, we continue to see good underlying net sales, 400 million this quarter, with circa three quarters driven by one market. funds this time. Yet today we have had 1 billion net sales, reaching the year end target a quarter earlier. AEMs have grown 17% versus last year. One third, as you can see, attributable to net sales, and two thirds coming from valuation effects, predominantly in equities. Contrary to the local industry, the dominant products we sell are equity and balance funds, with good management transaction fees, of the typical target maturity products that replicate time deposits. The above reflect the strength of the bank franchise. Then to slide 21 on asset quality, NP ratio was at 3.6%, mainly on account of circa 70 million of retail net flows. Coverage ratio has thus edged to 55%. The underlying picture remains solid. We're not particularly concerned with any flows as should be evident by the underlying cost of risk. That's at 26 base points for the quarter. We don't expect any meaningful surprises in the coming quarters and remain on track to deliver the full year guidance of 45 base points. To wrap it up, let's turn to slide 22 on the capital. This quarter we had 38 basis points of capital generation organically, and this includes everything that is business as usual. So P&L, DTAs, as usual, DTC amortization, the semi-annual 81 coupon and RWA growth. Overall, we're still very much on plan for organic capital generation. As mentioned, we have accrued a further 93 million towards dividends, bringing the total year to date to 352 million. whilst 37 basis points of capital you see here includes DTC acceleration. All in, CET ratio stands at 15.7% on a fully loaded basis, or 10 basis points higher if you take into account pending transactions. Note that the transitional CET one ratio stands at some 36 basis points higher at 16.1%. With now, let's open the floor to questions.

Ladies and gentlemen, at this time we will begin the question and answer session. Anyone who wishes to ask a question may press star followed by one on their telephone. If you wish to remove yourself from the question queue, then you may press star and two. Please use your handset when asking your question for better quality. Anyone who has a question may press star and one at this time. One moment for the first question, please. The first question comes from the line of Dimitrio Alex with Jefferies. Please go ahead.

Hi, just two questions from me. So next quarter we see the Axia and Astrobink deals close. So if you were to look across your current product offering and income lines, are there any other areas where you see gaps or you'd like to strengthen that could be supported by the bolt-on acquisitions or potentially supported through the partnership with Unicredit? And just secondly... So on loan yields, when should we expect the yields to stabilize if rates were to remain flat from here? And we start to see the end of the replacing lag that we are likely to see continuing to Q4. Thank you.

Well, Alex, it's Vassilios. I'll take the first one. On the area of bolt-on, as we have said in the past, bolt-on has been quite an efficient and effective way of doing two things. Number one is to quickly go to narrower areas where we spotted gaps or where we want to accelerate further our product offering and or geographies. And the second element that we have been fortunate to tie this so far is that we acquired with it excellent human capital, which is, as you well know, currently one of the biggest constraints that we have across the industry or across the industries, I should rather say, for growing further. So this to us being a proven strategy, which we do continue to scan the universe for areas like that. As I said, it's not just about gaps. It is also about progressing faster. There are such and we're actively looking into that.

If I may add, regarding your question for the closing of the announced transactions, Astro has closed. So in the fourth quarter, you will see its numbers in the group numbers. As far as Axia is concerned, we expect closing in the fourth quarter of 2025.

If I can pick up on the second part of your question, if I understand correctly, you tried to assess what's the outlook for the NII? I mean, the first thing to note here that we are still very confident on our total revenue projections for 2026. Now, as regards to the dynamics, you're right to say that some of the pressure that we had on the rates in Q3 versus Q2 will be abated, so you should expect slightly better picture in Q4 versus Q3, so we continue this trend, but most of the growth in NII, we're going to be looking at it in the 2026 numbers, where effectively we expect flat rates and, you know, the impact of volume growth on the loans to come into play.

If I could just follow up. So if we think about the loan yields in a stable environment, when do you expect them to be flat and we no longer see that repricing lag come through and so kind of lower interest income, excluding the volume effect?

I think we need to leave that for the full year stage where we're going to provide guidance for 2026. I don't think we ought to be commenting on that at this point.

No, no, that's very clear. No worries. Thank you.

But I think given Alex's question, just hold on this point, I think it is useful perhaps to give a bit, so sketching a bit on what may come our way for 2026. Because I think the important thing for the market to understand is that for 2026, what we're going to be looking for is to capitalize on the strategic approach that we have taken so far. And as such, I think we're comfortable with market expectation vis-a-vis our total revenues. That is the point I would like to stress that Vasilis also mentioned before. And, you know, so far we have been building on holistic relationships, which are now proven to be the core advantage of our bank, and that allows us to be more adaptable as the demand for non-lending services, including asset and wealth management, et cetera, is picking up. So that, I think, is a key takeaway, and that is what you should expect to hear more from us when we have our full year results looking into 2026.

Mr. Dimitriou, are you done with your questions?

All done, thank you.

The next question comes from the line of Kemeni Gabor with Autonomous Research. Please go ahead.

Thank you. Can I just follow up on NII and specifically on corporate loan spreads? which I believe have been trending down. You showed that on page 29 of the presentation. Is this a trend you would expect to continue? I mean, 2.4% corporate loan spread is still very solid. That's the first one. Second one, you mentioned that the deposit pass-through has perhaps been higher. than you than you expected and indeed you show a 65 deposit pass through um can you elaborate on the dynamics here and how the front book back book of the pricing of the deposit portfolio looks like and just lastly a very comfortable capital position even if we take into account the upcoming transaction closings um how do you think about raising your your distribution above 50 from 25 results thank you

Let me try to pick on this. Thank you for the question. So starting with the corporate loan spreads, you're right to note that there's a bit of a linear, you know, seven or eight basis points tightening on a quarter to quarter basis. You know, as we see the market, we're sort of leading the absolute level compared to our peers. So we're very happy with the mix that we have, that we keep some distance from the tightest situations. And as mentioned several times, we are walking away from situations that don't fit our return on investment criteria. I think it's useful also to keep in mind that the strategy here when we're looking at the corporate relationship is not all around spread, but around the overall relationship. That's why you see much of what we see lower in NII from spreads to be recouped from trade finance. Trade finance for reference is run about more than 30% corporate. Transaction banking fees from corporate is run about 30% higher this year than the previous year. Now on the time deposit pass through, I think you're right to note that, you know, pass-through is pretty much stable at around about 65%. We're sort of tracking the market on that one, to be frank with you. And what we see happening in the market is that as rates stabilize, and mind you that rates practically have stabilized in Q3, the time deposit book takes around about six to seven months in our case to converge. So you should expect in the next couple of quarters, time deposit pass-throughs to go, I don't know, maybe collectively four or five points for the whole market, including us. I wouldn't give you that for the next couple of months, but as I said, it should take a couple of quarters for this to materialize, assuming, obviously, that base rates are going to be at the same rate that they currently are, you know, around about 2%.

On the point of, if I may take it, Vasile, on the point of distribution, I think for 2025, it is clear that we expect to pay 50% of the reported profits, so that's close to 450 million, 111 of which will soon be distributed as an interim dividend. And from where we see it, we clearly have the capacity to grow higher than that, and it's something we intend to do from 26 onwards, both in terms of absolute amount on account of earnings growth and obviously subject to regulatory approval on the back of a higher payout.

That's very helpful. Thank you. Just a small follow-up on the four or five points you mentioned. I'm not sure I got that. What did that refer to, please?

Time deposit pass-through, Gabor.

Understood. Thank you.

The next question comes from the line of Munari Filippo with JP Morgan. Please go ahead.

Yes. Good morning, and thanks for the presentation and taking my questions. So I have two questions. So the first one, I saw that you raised the normalized EPS target. excluding the buybacks to 47 cents in 2027 from 46, I think. So what's driving that? Is it better fees, better OPEX or a combination of things? If you can please give some color and that would be super useful. And then second thing on the trading and other income side, I understand there is a 12 million of negative impact from tier two refinancing in the quarter. But that should explain only part of the weakness because the run rate would be still quite higher than that. So can you please comment if there were other negative factors affecting the trading line in the quarter? Thank you.

If I quickly take the guidance, the 47 cents is something that we have disclosed back in August with the second quarter results. And it's mainly on account of a lower cost of risk. Hopefully you remember the discussion we had back then about the improvement we've been able to produce on the guidance with cost of risk sustainably. So that's the only reason behind the 47 cents in 2027. And then the other question, Vasily.

Sure. I mean, if you turn to page 16, your question, you're asking us around the Q2, 30 million of trading and other income versus the Q3, 1 million. You're right to point out that around about 12 million is the LME. The other element which is not worth it here is rental income, to be frank with you, which is classified as other income. This is the dividend from our 10% shareholding in Rodea. This was a $12 million dividend which was paid out in June, and obviously they don't pay such a dividend every quarter. I think more importantly, it's important, you know, for people to consider, and I think some of that is due on us too, that when the bank is reporting around about, you know, 460 plus net fee and commission income, we're missing around about another 25-ish currently on an annual interest-based rental income, which, you know, other people used to report in this line, so I think, you know, In the coming quarters, we should make this more clear because this is a recurring line coming in. On top of this, our risk appetite for real estate is growing. This is an investment that we are continuously stepping our feet, so we expect more to come in Q4 in terms of investment and more investment recurring income to come out of these investments in 2026. But obviously, hopefully, you have make some patience to give you a bit of a full picture around that in February.

Very clear. Thank you.

The next question comes from the line of Kantarovits Alexander with Roma Capital. Please go ahead.

Yes, thank you. Hello, hello. My question would be on unique credit participation, clearly a major factor affecting the evaluations, and now that they have reached 29% and possibly going higher, Surely this partnership is having big strategic implications for Alpha. So my question is, how do you see this participation progressing in the near future in 2026, if possible?

Well, I think for something that you implied about the evolution of the stake, since we are not the owners of the stake, I think I'm simply going to echo what Andrea or Sal has said on that. Now, the way he and we view it is that we have an outstanding relationship at all levels with Unicredit, and this is not just the top management team, but a wide array of people at Unicredit that are regularly involved with people on our sites as we're doing so many things together. We and they, we're all excited to do it because it is truly a mutually beneficial relationship, both in terms of commercial activity as well as exchange of know-how, and the partnership is outstanding, and this is progressing well on all fronts. And thus, as a result of that, both as Alpha Bank, but I think also as a country, we have welcomed Unicredit to Greece. And as the saying goes, if it works, I mean, don't fix it. There is nothing more at the moment beyond the current state. All I can reaffirm is that we are deepening and broadening the things that we are doing together. And there's going to be more on that that we will be able to report quarter by quarter.

Okay, okay, thank you. Let's call it deepening, yes. My second question is on the effect of FX on loans. I think you used the phrase FX headwind in one of your slides. Can you elaborate?

Sure, yeah, I'm happy to take that one. Effectively, what we're saying is that the bank, I mean, rough numbers, has 36 billion loan book in terms of euro. On that, you should include something that's, you know, 3.2, 3.3 billion of USD denominated shipping loans. And obviously, interest starts in USD. So these two metrics stemming from the balances, right, and the NII do have an impact when the dollar has weakened some 15%, 16%, if I remember the numbers correctly, from the beginning of the year. So that is the impact that we're discussing here. Does that make sense?

Yes, total. Thank you very much. That's all I have.

As a reminder, if you wish to register for a question, please press star and one on your telephone. Ladies and gentlemen, we have another question from the line of Novoselsky Elia with Bank of America. Please go ahead.

Hi. Hi. Thanks for taking my questions. I have two, please. investor day that should come in Q2. If you can just give us maybe a sneak peek of what would be the main topics that would be subject to discussion. And I also wanted to ask the reasoning behind the timing of the investor day, because your previous one, which was in 2023, was at the time when there was a lot of change in rates, macro and so on. Well, now we are entering arguably a place of stability, and you also tend to give three-year targets on your Q4 results. I just wanted to ask about the reasoning for the investor day. And second, maybe if you can comment a bit of your loan pipeline for Q4, if you can say whether it should be stronger, weaker compared to this quarter, and whether it should be large corporates or there's some movements more into SMEs. seeing on slide 40, which is showing your disbursements versus repayments, that this quarter you had rather solid disbursements, but you had an increase of repayments, and if there's a reason for that. Thank you.

I'm going to take the first one. I'm sorry, I'm afraid I'm going to have to disappoint you. Unlike movies, we're not going to be producing trailers for the investor day. You need to hold your breath until then, and hopefully it's going to be a nice show. so no color whatsoever on what we're actually going to be publishing with the investor. In terms of timing, this has to do with investor relations planning and how we work internally. There's a specific cadence of events that's leading us towards the second quarter of next year, also taking into account the busy schedules that investors and analysts like yourself have. On the second question, Vasili?

Thank you, Yasaman. I mean, On the loan growth, if we start with Q3, as you rightly say, it was another strong quarter. Seasonally, Q3 is a good quarter because of the footprint of the bank. The bank typically has a much larger footprint in tourism and accommodation and both hospitality projects and trade. around these areas is picking up in the summer. Hence, we had another good quarter. To a lesser extent, just for the quarter numbers, it was construction and energy, you know, very typical drivers of our Q3, of our quarterly evolution. Now, when it comes to Q4, first of all, important to note that we have guided the market on around about a 2.2 billion net credit expansion for the year. We're already there in the first three quarters. Now, when it comes to Q4, you know, it's fair to say that we're going to be crossing our annual number, but I would be hesitant if I were you to put another, you know, 600, 700 million into this. The reason has to do with what we mentioned during the presentation, that there is a couple of large refinancings coming in Q4. This is a couple of transactions linked to M&A, where some of our competitors opted to go a bit more aggressively in credit terms. didn't want to go there, so I would say you wouldn't expect, you shouldn't be expecting any fireworks in Q4. Still some positive, mild positive growth. Then on retail, what we have seen, which is pretty much in line with the market, is that from quarter after quarter that we had negative inflows, Q3 was the first not the first, but one of the quarters that had positive inflows in all segments, both SVs, which is typically a stronger product line, but also mortgages and consumer loans. We expect this to continue as retail is turning corner. I mean, hard to imagine, you know, half a billion out of retail in the coming quarters, but, you know, still having like 50s or 60s. The negatives is a good number for us. I'll have to disappoint you on why the repayments in Q3 are in the tune of 2.1 billion. Let's take it offline because honestly, I don't have it on the top of my head.

Thank you.

We have another question from the line of Negro Alberto with Mediobanca. Please go ahead.

Yes, thanks for taking my question. Good morning all. Very two quick questions. One is on the bond portfolio. This quarter seems that the repricing of the bond portfolio has been very minimal. Can you help us to understand when we should see the better yields coming through the NII? And the second one, if you can help us to understand the impact of Astrobank in Q4 for the P&L lines? and if this is included in the full year guidance.

Thank you. I'll take the second one on Astrobank. We're only talking about a bit under two months, so there's not a very big impact, and it's already included in the guidance that we have provided to the market for this year. So minor impact from Astrobank. Obviously, we're going to be extracting some synergies next year, and you will see more material impact thereafter in line with the guidance that we have provided for a 5% uplift to EPS. On the first question you had on the repricing of the bond portfolio and when we expect yields to improve there, we have yet again with us our CIO, Konstantinos, here to answer.

Hi. You've already seen the impact from Q4 and Q1. on the repricing of our bond portfolio and you should continue to see that all the way into 2026 not only from the investments happened this year but the upcoming maturities which again are going to be reinvested that 1% or higher than the current back book yields. Obviously on the last quarter we didn't make any significant investments or lower maturities and that's why we haven't seen any significant impact on quarter-on-quarter on that book. Thank you.

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

Thank you very much for your participation. We're looking forward to welcoming you again at the very last week of February where we're going to be releasing our full year results. Thank you very much.

Ladies and gentlemen, the conference is now concluded and you may disconnect your telephone. Thank you for calling and have a pleasant evening.