Piraeus Financial Holdings SA (BPIPF) Q1 2025 earnings call Highlights: strong profit growth …

Appearance date: May 06, 2025

You can find the complete copy of the earnings call in the complete earnings call.

• The Piraeus Financial Holdings SA (BPIPF) recorded a strong net profit of EUR 284 million for the first quarter of 2025, which marked an increase of 22% compared to the previous year.

• The company achieved a return with an average concrete book value of 14.7%and exceeded the target of 2025 of approx. 4%.

• With an NPE ratio (non-performance exposure), the quality of the assets remains solid at 2.6% and a historical low risk costs at 35 basis points.

• The loan book was expanded by EUR 1.1 billion in the first quarter of 2025 and continued the strong dynamics of 2024.

• Piraeus Financial Holdings SA (BPIPF) increased his managed assets to EUR 12.5 billion and already exceeded the target of 2025.

• The net interest rate income fell by 7% annually due to a material interest system.

• The company is exposed to the potential capital volatility from its securities book, which was not booked in amortized costs.

• There is uncertainty about the effects of Basel 4 and other regulatory changes on the capital relationships.

• The growth of the mortgage market is expected to be moderate, with some initiatives being slower than expected.

• Due to the normalization of the principles in the upcoming quarters, a further reduction in the net interest rate is expected in the upcoming quarters.

Q: What is the reason behind the choice not to book the increase in the securities book in amortized costs, and how do you manage the potential capital volatility from these positions? Could you also clarify the capital effects from the acquisition of an ethnic insurance? A: The decision was to book the new additions as part of the OCI book with appropriate hedging instruments in order to avoid volatility. The capital effects of the acquisition of ethnic insurance are likely to be between 150 and 160 basis points, with the potential application of Article 49 of CRR3, but not in the main plan.

Q: How should we think about the seasonality of the credit expansion over the year, and can you give insights into the current loan pipeline or changes in customer behavior? A: The first quarter was particularly strong because significant transactions set the sound for the year. We are not yet improving all -year instructions, we remain vigilant. The consumer market for retail is positive and we expect moderate growth of the mortgage market by the end of the year.

Q: How does business prospects change when the tariffs are subject to certain levels, and what are the drivers behind the increased NII sensitivity in this quarter? A: The increased sensitivity is due to the expression of mortgages, which are now sensitive to installments. The assumed passage of the interest rate in time deposit costs is 60%, currently 52%. We assume that the NII guidelines even applied with rate reductions, as it is expected to reduce growth a potential waste.