On the asset quality front, organic NPE reduction was notable – down almost 1 percentage point in the quarter – with
a negligible impact from clients in default 11 months after the end of the Covid-19 moratoria; in contrast, curings
continue unabated.
As a result, provision coverage increased to a more than comfortable 70% in view of the solid underlying, mostly real estate, collateral. And this despite the continued gradual reduction in the cost of risk to 94bps in 3Q21. Overall, the domestic NPE ratio stood at 11.9%, with the NPE stock settling at €3.7billion and €1.1billion net of provisions. Regarding transactions, Frontier is expected to close in a couple of weeks.
Turning to profitability, the progress achieved in the first half of the year accelerated in 3Q21, with core operating profit up c20% for a second consecutive quarter to €134million, with strong improvements in the top line as well as operating and provision costs. Thus, the 9M21 core operating profit was up by 50% yoy to c8% of tangible equity.
Notably, net loan expansion so far in 2021 nears €1billion – among, if not, the best performance of the sector – with high disbursements offsetting unprecedent refinancing from the bond market.
The capital accretive NPE performance, both organic and inorganic, combined with the strong profitability has led the capital ratios higher, to 17.8% and c19% for the CET1 and total capital ratios, pro forma for the closing of Frontier and Ethniki Insurance.
Looking forward, the substantial results from our transformation effort, the revamping of our service and operating
model, including the impressive digital turnaround, are coinciding with a unique economic conjuncture, with the
confluence of several positive forces: the decade long efforts to restructure the economy along with a global macro
rebound and the inflow of significant Recovery and Resilience Funds. We are, thus, well placed to support and advise
our clients in achieving their future plans, including through the NBG platform for the RRF “Ethniki 2.0”, with NBG as
their partner: the bank of first choice.
