The Greek banks they successfully crossed one long phase of profound renovation, parallel to that started by the country after the well -known sovereign debt crisis of 2009. Underlines it Marco Mencini, Head of Research of Plenisfer Investments Sgr, commenting on the prospects of the Greek banking sector. In the face of this renovation, in the last ten years the banks, towed by the four main players – NBG, Piraeus, Alpha and Eurobank – “They recorded exceptional growth e higher than market expectations, in terms of margins, profits and patrimonial solidity. In the period, bank securities have almost always overperformed their homologues of the euro1 area until about a year ago, when the market has started to believe that the banks had now entered one normalization phase “.
In Plenisfer We think, however, that the phase of the sector re-rating is destined to continue: the banks have just started to transform the excellent results of the process of rationalization in remuneration of shareholders and will be able to benefit not only to further processes of efficiency, but above all, of an economic context in strong improvement, with growth rates higher than those of the eurozone. These conditions, combined with still compressed assessments, make the sector an opportunity to look carefully at.
Strong economy below to support the sector
The Geditor It is not only the most important case of renovation at the sovereign level of the last 15 years, it is above all the most successful case. After draconian interventions on the budget and a decisive reform plan, today the Greece highlights largely higher growth rates to the rest of the eurozone, a debt in strong decline and a strong ability to attract investments from abroad.
On the GDP front, passed from -2.5% (2013) 2 to +2.5% (2024) 2, Greece has continued to overperform the Eurozone in the last twelve consecutive quarters and hypothesized a growth of 1.9% for 2025. If made, the economic growth of Greece would be equal to about the European one that according to the Consent estimates will touch 1% in 2025.
THEThe public debt/GDP ratio reached about 150% at the end of 2024 and is expected in additional drop to 132.8% by 2029, in decisive improvement compared to the peak of 207% in 2020.
Trust in the economy and the positive economic context -characterized by an unemployment rate dropped in ten years from 28% to 9.7%, consumption from -3.4% to +2.5% and real estate market with growing prices of 12% in 20242 -led to an increase in gross fixed investments, an engine of the growth of GDP, also supported by the loans and subsidies of the Fund for the recovery and the EU resilience.
Re-rating is halfway
The institutes Greek credit they will be able to benefit from growth dThe economy having ample margin to provide funding, given the low levels of the relationship between loans and deposits. The sector is also characterized by patrimonial solidity, expected profitability in further improvement and quality of active recovery assets. Following aggressive cleaning, devaluations and removal operations, NPEs have gradually decreased by 6% in 2024 (from 49% in 2017), an impressive improvement even if the figure remains higher than the EU average (1.9%). We believe that this positive trend can continue in the two-year period 2025-2026.
will resume at the end of the ongoing break
In plenisfer we also estimate that In the coming years the main banks will maintain CET 1 (Common Tier Equity 1, or the ratio between the primary capital and the complex of weighted risk activities) significantly above 13%, while the margin of net interest should remain stable despite the cutting of European rates, thanks to further possible improvements in operational efficiency. The Greek banks they have already started to transform the excellent results of the rationalization process into a remuneration of shareholders equal to over 10% in 2024 and, also in light of the rEccenti Guidance communicated by the main institutes, we foresee a gradual increase in payout ratio from 20% to 40% on average in 2025, with dividends yields that will increase from 4% of 2023 to 8% in 2025, Given higher than the average 2024 yield of EU banksequal to 7%.
Complaces, multiples growing?
Despite the scenario described, Greek bank securities deal with about 6 times G todayThe profits expected for 2025 compared to the 9 times the expected profits of the Eurozone, with underground levers compared to European competitors (less than 9x against a European average of 12-13x). In plenisfer “we believe that the re-rating of the sector is still incomplete and that, while the Greek banks, supported by the solidity of the budgets, they will ride economic growth stronger than the eurozone, Multiples can progressively rise towards the level of European competitors “.
