The banks’ net interest income (NII) rose quarter on quarter, mainly thanks to higher lending volumes, higher interest rates, income from bond portfolios and a favourable deposit mix, together with the supportive effect of deposit beta. All these factors more than offset the mild — and expected — pressure on loan margins, an NBG Securities analysis of the sector notes. As a result, the system’s net interest margin (NIM) widened quarter on quarter.
- Fee generation across the system remained strong. However, fee income fell quarter on quarter, reflecting the high level of activity (e.g. investment banking – IB) and exceptional income (dividends received, non-recurring fees, etc.) in the previous quarter, which had set a high comparison base.
- Non-core income was mixed, with significant differences among the systemic banks amid considerable volatility in bond markets during the period under review. National Bank of Greece and Eurobank posted positive results, Alpha Bank recorded a result close to zero, while Piraeus Bank reported trading losses. Performance also reflected the composition of each bank’s investment securities portfolio.
- Growth in core revenue offset the decline in non-core income, leaving total operating revenue almost unchanged quarter on quarter.
- System operating expenses (OpEx, recurring) were slightly lower quarter on quarter, reflecting cost rationalisation and targeted investment in staff and technology.
- Despite persistent global geopolitical uncertainty, the asset quality of Greece’s systemic banks remains strong and unaffected, with the system’s non-performing exposure (NPE) ratio unchanged quarter on quarter, lower new NPE inflows and provisions remaining at adequate levels. The cost of risk (CoR) edged up quarter on quarter, in line with each bank’s forecasts.
- Credit growth was driven largely by the corporate sector, while deposit growth significantly outpaced loan growth. As a result, the system retains ample capacity to provide further financing.
- Greece’s systemic banks continue to have strong capital adequacy, with capital ratios comfortably above regulatory requirements and supervisory guidance. This is supported by steady organic capital generation, driven by recurring profitability and the high quality of their loan portfolios. By comparison, National Bank of Greece retains a substantial capital surplus, giving it flexibility in its strategic choices, followed by Eurobank, Alpha Bank and Piraeus Bank.
- A consistently strong capital base and resilient recurring profitability once again enabled Greece’s systemic banks to announce interim shareholder distributions totalling around €692 million.
Alpha Bank reported high-quality results for the third quarter of 2026, exceeding market expectations and our estimates (consensus and NBG estimates).
Strong growth in lending and deposits, a favourable interest-rate environment and rational pricing contributed to robust growth in net interest income (NII). At the same time, previous investments in businesses generating non-interest income supported growth in fee income, with further gains expected to come through in results in the periods ahead as the acquired entities begin to contribute fully to earnings.
Despite higher revenue, operating expenses remained under control. Asset quality was also not sacrificed in pursuit of growth (excluding non-recurring events), with impairment charges therefore coming in at expected levels. In this context, management selectively upgraded certain income statement items while leaving other 2026 targets unchanged. Overall, Alpha Bank delivered a strong set of results for the third quarter of 2026.
Eurobank: A good set of results, slightly ahead of market expectations and our forecasts. Positives included strong growth in net interest income (NII), with a significant increase in Greece followed by satisfactory growth in international markets.
Higher lending volumes in both domestic and international markets, higher interest rates, improved deposit margins and bond income offset pressure on loan margins, lifting the Group’s NIM. Fee income growth was less pronounced because of seasonality, but remained satisfactory, while the completion of the Eurolife acquisition paves the way for faster growth from the fourth quarter of 2026 onwards.
Trading income was lower quarter on quarter amid global volatility in bond markets, slowing growth in total revenue. Operating expenses remained under control. Meanwhile, resilient asset quality was reflected in CoR, which was in line with management’s forecasts amid heightened geopolitical risks.
Capital ratios remain strong, supported by organic capital generation from improved profitability. This gives management the ability to pursue organic growth, consider opportunities for inorganic growth and reward shareholders. Management also remains confident of achieving its full-year targets, based on the good performance in the third quarter and first nine months.
Piraeus Bank: A mixed set of results, below market expectations and our forecasts. The shortfall, however, was due to volatility in fee income arising from one-off factors related to lending fees, a higher comparison base for investment banking (IB) fees following stronger activity in the second quarter, and underperformance in non-core activities, which led to trading losses amid volatility in bond markets.
CoR was also higher because a portfolio was classified as held for sale, leading to higher impairment charges. By contrast, net interest income (NII) rose satisfactorily, pointing to an improvement in NIM thanks to higher interest rates, growth in lending and deposit volumes, and income from the bond portfolio. These factors more than offset mild margin compression.
Operating expenses also remained under control, offsetting the relatively flat performance of core revenue quarter on quarter and improving the C:CI ratio. Despite subdued performance in the third quarter, management reaffirmed its full-year 2026 targets, also noting scope to exceed its NIM and fee margin targets.
In addition, 2027 targets were revised upwards, underscoring management’s confidence in its ability to meet them. Despite a more cautious initial assessment of the third-quarter 2026 performance, given the effects of market volatility and non-recurring items, Piraeus Bank’s results were satisfactory, while its outlook is now more positive.