Eurobank Ergasias Svcs

Ladies and gentlemen, thank you for standing by. I'm Konstantinos, your course call operator. Welcome and thank you for joining the Eurobank Holdings Conference call to present and discuss the first half 2025 financial results. At this time, I would like to turn the conference over to Mr. Foukion Karavias, CEO. Mr. Karavias, you may now proceed.

Ladies and gentlemen, good afternoon and welcome to the Eurobank first half 2025 results presentation. Together with me is our CFO, Mr. Haris Vakologiannis, and the investor relations team. We are starting with some key recent developments, then presenting our results and answering your questions. Global economic conditions are normalizing, overcoming any concerns related to tariffs and geopolitical events. In Europe, A more relaxed fiscal policy adopted by some countries, combined with increased investments in infrastructural defense, may provide sustained economic stimulus and strengthen resilience. The region we operate in, Greece, Bulgaria and Cyprus, continues to grow faster than the EU. In Greece, fiscal discipline remains strong, are seen in primary surplus figures in the first five months of the year, and the debt-to-GDP ratio improved the most among EU countries. These trends were reflected in sovereign bond spreads, as GDPs are trading through Italy and at part with Spain. Taking advantage of the favorable market conditions, Eurobank proceeded to its first 81 issuance in May. Trade expansion continues to demonstrate strength, supported by sustained business lending in Greece and solid growth across all loan categories in Bulgaria. The forthcoming euro adoption in Bulgaria, scheduled for early next year, is anticipating to be a significant milestone towards further economic convergence with Europe. Now let's move on to our financial results as highlighted on slides 5 to 10. Eurobank reported robust financial performance in the first half of 2025, achieving an adjusted net profit of 711 million euros and the return on tangible book value of 16.6%. In more detail, Net interest income rose 12% year-on-year, as the quarter-on-quarter drop decelerated to less than 1%. Fees and commissions were up by 29% year-on-year, supported by a strong second quarter. As a result, corporate provision income was up by 7% year-on-year, to over 1 billion euros. The cost of risk ratio remain at 60 basis points in line with our full year guidance. Asset quality remain resilient for another quarter with the NP ratio decreasing to 2.8% and coverage exceeding 90%. As a result, core operating profit reached 866 million euros. This is more than 6% higher year on year. Regional operations performed strongly, netting 374 million euros, highlighting the group's franchise trend. Cyprus' net profit reached 250 million euros and Bulgaria's 110. Now on volumes, lower growth continued unabated with a quarterly net increase of 1 billion euros. This is 11% up year on year. The strong pipeline allows us to revise upwards our full year loan growth target from 3.5 to 4 billion euros. Deposits returned to growth in the second quarter, increasing by 1 billion. Wealth management performance was also strong, with managed funds and private banking customer asset liabilities moving up by 26 and 11% year-on-year, respectively. The total capital ratio was further enhanced by the 81 issuance to reach almost 20%, while the Set 1 ratio stood at 15.5, absorbing the impact of the CNP acquisition in Cyprus. In conclusion, the first half results were in line with our plan. notwithstanding a more rapid decline in ECB interest rates. Consequently, we anticipate that the return on tangible book value will exceed the initial annual target of 15%. The strong first half performance allows us to align with other European banks' policy by introducing for the first time a 2025 interim cash dividend of 170 million euros. This is 4.7 cents per share to be distributed in the fourth quarter. At this point, I would like to ask our CFO, Kharis Mokologiannis, to present 2025 first half results before opening the Q&A session.

Thank you, Fakion. Prior to commencing, I would like to highlight that this quarter marks the first time consolidation of SEMPE insurance. In this context, we have provisionally recorded negative goodwill of 38 million euro, with the final figure to be determined by year end. Let's now provide more insight into the second quarter results. Starting on page 21, on lending volumes. For another quarter, the group experienced strong organic growth with an increase of 1 billion euro in the second quarter and 2.2 billion the first half of the year. This growth was primarily driven by corporate lending in Greece and mortgage lending in Bulgaria. Based on these trends and the current pipeline, the full year long growth target was raised from 3.5 to 4 billion euro. Group deposits on page 22 recovered in the second quarter, rising by €1 billion, or €1.5 billion excluding FX effect, mainly due to retail deposits in Greece, with positive contributions from PostBank and Hellenic Bank. The net loan-to-deposit ratio remains stable at 6-7%, while the LCR ratio improved to 191%, following the issuance of 81 capital, as shown at the left of page 23. As regards managed funds, on page 25, in the second quarter, the wealth sector continued and abated its growth pace. Quarter on quarter, managed funds increased by 450 million euro, and year on year, are higher by 1.7 billion or 26%. Private banking customers' assets and liabilities reached 13.5 billion euro, increased by 11% year-on-year.