Alpha Bank Sa

Ladies and gentlemen, thank you for standing by. I am Yota Yokoru's call operator. Welcome and thank you for joining the Alphabank conference call to present and discuss the first half 2026 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 Alphabank Management. Gentlemen, you may now proceed.

Hello everyone and welcome to the presentation of our second quarter results. I am Iason Kepaptsoglou, Alphabank's Head of IR. Our CEO, Vassilios Psaltis, will lead the call with a usual summary and a few updates. Our CFO, Vassilios Kosmas, will then go through this quarter's numbers in some detail. Q&A will come at the end of the call and we should wrap up within the hour. Vassili, over to you.

Good morning, everyone. Thank you for joining our call. Let's start with an overview of our results for the first half of the year on slide four, please. The first half of the year saw us posting close to half a billion in profits. On a normalized basis, this is up 6.5% versus last year. Our net interest income is up 7.3% versus last year, as we continue to benefit from growth in the loan book. Fees are up 34% on a headline basis, or 24%, if one excludes dividends from our participation in ProDea, as we reap the benefits of investments in the business and our proactive M&A strategy. At 39%, our cost-to-income ratio has remained within guidance, showing the operating leverage of our business. Cost of risk continues to reflect the benign environment at 42 basis points, and performing loans have grown at double digits, and we've reached 87%, of this year's target for net credit expansion already in the first half of the year. Customer funds have jumped 7% in this quarter with corporate deposit inflows, stronger EM net sales and valuation tailwinds. And we continue to post good levels of organic capital generation in spite of the quarter specific headwinds. Overall, we have delivered more than half of our 2026 target for net profit with the fundamental drivers of earnings growth and profitability performing better than expected. As a result, we are upgrading our guidance for EPS to 41 cents. We've also accrued 273 million euros for distribution so far this year, and we intend to distribute circa 124 million euros as an interim cash dividend in the fourth quarter. The numbers demonstrate continuous execution. What is perhaps more important is the transformation taking place underneath those numbers. and I would like to take this opportunity to showcase how we have fundamentally upgraded our wholesale franchise starting with slide 5. Historically, Alphabank's wholesale franchise was built around lending excellence. Today, we are evolving towards a universal business bank model. We have deliberately expanded our product capabilities, strengthened specialized coverage and created a platform that allows us to capture a much greater share of our clients' wallets. The objective is simple. Every relationship should generate value beyond lending through transaction banking, investment banking, capital markets, trade finance, foreign exchange, advisory, and cross-border solutions. This is precisely the model we will discuss in more detail at Investor Day, and it sits at the center of our ambition to deliver faster growth in capital light fee income. Turning now to slide six, the first proof point is transaction banking. Over the last three years, we have invested significantly in building dedicated transaction banking capabilities. We established a specialized group, expanded product expertise, and broadened our offering in payments, cash management, foreign exchange, and trade finance. As a result, transaction banking is becoming increasingly embedded into our corporate relationships. Transaction banking specialists are now included in client teams, working alongside RMs with clearer incentives to deepen This is allowing us to capture a larger share of the operating flows of our corporate clients and convert existing lending relationships into recurring capitalized fee income. In trade finance, where data is available for the system, we've increased our share by circa 10 percentage points in import letters of credit and more than 11 percentage points in foreign guaranteed issues. The result? is a staggering 38% increase in the revenue generated by transaction banking. Turning to slide seven, this is the second proof of point in investment banking. A concrete example of how M&A strategy is already translating into tangible commercial outcomes. Axia is a particularly good illustration of the type of platform we set out to acquire. Our objective was to create a leading regional investment banking and capital markets franchise. that would strengthen client coverage, deepen fee generation, and expand AlphaBank's capabilities across the advisory and capital markets value chain, allowing us to complete the wholesale product shelf. The results we are seeing today validate this strategic rationale. During the first half of 2026, Axia advised on 17 transactions across 10 different sectors with a cumulative transaction value exceeding 10 billion. Activity remained broad-based across the market and demonstrates the strength of the franchise, its client relationships, and its ability to originate opportunities in multiple segments of the economy. Importantly, Axia has been active across the full spectrum of investment banking services. It participated both as a trusted financial advisor and as a leading book runner in landmark equity and debt capital market transactions, serving Greek corporates, international issuers, and investors alike. One of the most valuable capabilities that Axia brings to the group is its ability to mobilize international institutional capital. Across multiple transactions, Axia has broadened investor participation, attracted foreign demand, and contributed to stronger execution outcomes for clients. This directly supports our ambition to become the preferred financial partner for Greek corporates seeking access to international capital markets. We are also beginning to see the benefits of combining Axias expertise with Unicredit's international footprint. Together, through the Alpha Bank Group platform, we have already participated in cross-border transactions such as Allwind's 550 million senior secured notes and Zegona's 1.1 billion senior secured notes. These transactions demonstrate how this partnership extends our reach beyond our traditional markets and creates opportunities that neither institution could capture as effectively on a standalone basis. Axia has already strengthened our competitive position, accelerating the development of our investment banking platform and providing clear evidence that our disciplined approach to M&A is creating value for our shareholders. And then finally on slide eight, the third proof point, and this is the partnership with Unicredit. Unicredit extends the reach of everything that we have built. It gives our clients access to an European network while giving Alpha Bank access to additional product capabilities, expertise and transaction opportunities, from lending to trade finance to cash management, instant payments, markets and investment banking. The partnership has now moved decisively beyond its establishment phase and is delivering benefits across lending, transaction banking, trade finance, treasury products, cross-border lending, investment banking and client services. A good example is the launch of European Gate. In practical terms, European Gate gives Alphabank clients with subsidiaries abroad a seamless transaction banking presence in key unicredit markets, allowing them to more easily access cash management services and manage liquidity, mass payment execution, and cost border account visibility through a more integrated network. This is particularly relevant as instant payments become a more important part of corporate treasury and day-to-day liquidity management. and as a key challenge for treasury departments is the handling of multiple banking relationships for mass payment execution across different countries. By combining Alpha's client relationships with Unicredit's infrastructure and local market presence, we are broadening the solutions available to Greek corporates with international operations and reinforcing our position as the banking partner of choice for companies with international ambitions. At the same time, Trade finance activity continues to grow strongly, with more than 100 million of guarantees and letters of credit exchanged in the first half of the year, while joint financing opportunities are gaining momentum across both international and domestic clients. More importantly, we're now moving from product by product cooperation to jointly targeting client flows. Alpha and Unicredit teams are increasingly coordinating around specific client opportunities, including through roadshows in the countries where the two groups have a presence so that we can originate more cross-border business, capture a greater share of operating flows and convert our combined network into tangible commercial outcomes. These efforts have already included joint client engagements in Bulgaria, a strategically important market for Greek businesses with more than 5 billion in bilateral trade flows and Greece ranking as the second largest source of foreign direct investment. focuses on supporting our customers in one of their key markets while capturing trade flows and increasing client access for both Alpha Bank and Unicredit through an enhanced cross-border offering in transaction banking, financing and investment banking. In the coming months, we will continue such joint initiatives, supporting our clients' cross-border ambitions and expanding our collaboration into other CE markets. We are now seeing increasing benefits from our collaboration in markets, treasury and client risk management. where Unicredit has become one of our key counterparties across a range of products including derivatives, foreign exchange and fixed income activities. These partnerships expand the solutions available to our clients while supporting the continued development of our own product capabilities. In investment banking, the cooperation has accelerated materially following the integration of Axia into our platform. We have jointly participated in prominent transactions and we are building a growing pipeline of cross-border advisory and financing opportunities. This collaboration enhances our ability to support Greek corporates as they increasingly pursue international growth strategies. Finally, for individuals and wealth clients, Unicredit strengthens our investment proposition by expanding our product offering, including through their one-market fund pallets. Since the launch of our partnership, we have distributed circa 1.8 billion of these products, demonstrating the strong client appetite for our enhanced investment solutions. Overall, The partnership with Unicredit continues to create a meaningful competitive advantage for Alphabet. It expands our product capabilities, deepens our international reach, strengthens our dialogue with clients, and reinforces our ability to generate sustainable growth. We remain confident that the commercial contribution of the partnership will continue to increase in the years ahead, creating further value for our customers, our shareholders, and all of our stakeholders. Taken together, These initiatives represent a fundamental transformation of our wholesale franchise. We have upgraded the product shelf. We have strengthened specialist capabilities. We have expanded our international reach. We are now evolving our coverage model to ensure clients are served holistically rather than product by product. Under the new leadership structure, we are bringing together relationship management, specialized product expertise, and cross-border capabilities around a single client view. The objective is straightforward. Higher product density, greater share of wallet, stronger fee generation, and deeper client relationships. This is the next chapter in Alphabank's wholesale banking story and one of the most important drivers of our future and its role. I would like to take this opportunity to thank Ioannis and Miris for leading our wholesale division, reestablishing it as the leading franchise in the country at a critical moment when the market returned to growth. Iosif Kiroukoglou, that has officially joined us as of yesterday from Bank of America, brings with him a wealth of international experience and has the right skill set to take this franchise up a level and lead the change in the coverage model. Let's now turn to the outlook, starting with slide 9. We have mentioned before that 2026 is a transitional year for us. We are razor focused on integrating the acquired entities, but quite reasonably, We will not see the full benefit of the expected synergies from year one. Commercial trends during the first half of the year have proven to be stronger than what we were originally expecting, strengthening the case for better core performance. But at the same time, we have been burdened by a number of extraordinary events. Vassilios will give you more detail on 2026 later on, but the bottom line is that we now expect to deliver 13% growth in normalized earnings. Credible recurring earnings growth is the natural outcome of our strategy and what we believe will continue to differentiate us going forward. We will be sharing more with you at our upcoming investor day in November. For now, on slide 10, we present the model that is driving this credible recurring earnings growth. We've gone through this with our first quarter results, but it's worth repeating the main points. The model rests on four mutually reinforcing pillars. Alphabank now combines deep client relationships with advisory, capital markets, and transaction banking capabilities in a way no domestic peer can replicate. Our advantage is that we capture a larger share of wallets. We are no longer just a lender. Through investment banking, transaction banking, trade finance, and corporate solutions, we convert existing relationships into recurring capitalized fee income. Second, we are moving retail banking beyond transactions and towards financial planning at scale. We have built a single wealth platform serving all client segments combining asset management, structured products, discretionary mandates, pensions, bank assurance and international wealth capabilities. Third, the Unicredit partnership accelerates both growth engines and provides a permanent structural advantage. And finally, all of this is supported by a performance-led operating model. Our investments are focused on delivering measurable commercial outcomes while our people model directly links development and incentives to performance. Taken together, these four engines create a self-reinforcing system for earnings growth, deeper client coverage, capital life fee expansion, structural acceleration from unit credit, and disciplined execution. This supports faster compounding of EPS, tangible book value and shareholder distributions, while delivering greater diversification with a larger distribution from fees and from our international insurance and real estate businesses. And lastly, on slide 11, we've been deliberate and consistent in how we think about capital location and our framework and the hierarchy within remains very clear and unchanged. Our first priority is to fund profitable loan growth. Loan demand in Greece remains resilient, led by corporates and supported by a strong investment cycle. We continue to deploy capital where returns are attractive while maintaining strict underwriting discipline and balance sheet optimization. At the same time, we're expanding transaction banking, trade finance, asset management, advisory activities, increasing the quality and durability of earnings through more diversified revenue streams. Second, our capital generation supports growing shareholder distributions. Strong earnings growth gives us confidence that payouts can continue to rise over time, supported by sustainable capital generation. This is already reflected in our actions. We restarted dividends conservatively, increased them as confidence strengthened, and have now embedded a higher payout in our capital planning. The interim dividend further underlines our commitment to predictable and growing shareholder returns, while buybacks remain an important complementary tool. Our excess capital provides strategic flexibility. So far, this has been deployed through highly selective, value-accretive acquisitions. Going forward, we will continue to balance shareholder distributions with opportunities to deploy capital into earnings-enhancing growth initiatives, ensuring we maximize long-term value creation. And with that, Vassili, over to you.