Hellenic Bank announced net profits of €365.4 million for 2023, marking possibly the highest profitability in the group's history, surpassing the 2018 profits and the negative goodwill generated from the acquisition of the former Cooperative Bank of Cyprus.

According to the results published by Hellenic Bank, the key driver of profitability was the net interest income, which soared by 78% year-on-year to €563.3 million. This increase was due to higher base interest rates and effective utilization of high liquidity in the bank’s balance sheet, particularly in deposits at Central Banks.

The bank’s Return on Tangible Equity (ROTE) reached 27% in 2023, up from just 2% in 2022. Additionally, the adjusted Total Capital Adequacy Ratio and Common Equity Tier 1 (CET1) capital ratio were 28.4% and 22.8%, respectively. It is noteworthy that Hellenic Bank is subject to a takeover by Eurobank of Greece, which holds 55.3% of its share capital. Under the 2007 Public Offer Takeover Law, Eurobank is required to promptly make a mandatory offer for the entire share capital.

“We achieved remarkable results with profits of €365 million for the year, primarily due to increased interest income from deposits and securities at the Central Bank, as well as reduced expenses following the 2022 Voluntary Early Retirement Scheme (VERS),” stated Antonis Rouvas, the bank’s interim CEO. He added that these results “confirm the progress made on multiple levels, including our transformation into a customer-centric and technologically advanced bank.”

Despite the environment of rising interest rates, Hellenic Bank granted a total of €1.2 billion in new loans in 2023, recording a 2% increase year-on-year in another record year for the group.

The bank's total net revenue amounted to €664 million in 2023, a 65% increase year-on-year. Net interest income saw a 78% annual increase, reaching €536.3 million, while non-interest income rose to €128 million, a 26% increase compared to 2022. The net interest margin was 2.75% in 2023, up from 1.60% the previous year.

The total expenses for 2023 amounted to €259.1 million, a 24% annual decrease compared to €342.5 million in 2022, mainly due to restructuring expenses recognized during 2022. Personnel expenses for 2023 were €119.3 million, a 16% reduction from €141.7 million in 2022, representing 46% of the Group's total expenses. The cost-to-income ratio fell to 39% in 2023 from 85% the previous year.

At the end of 2023, the bank's liquidity stood at €5.8 billion, with the Liquidity Coverage Ratio at 542%, significantly above the regulatory minimum of 100%.

Customer deposits totaled €15.3 billion at the end of 2023, down 4% from €15.9 billion at the end of 2022. The net loan-to-deposit ratio as of December 31, 2023, was 39.4%, compared to 39.1% at the end of 2022.

Gross loans as of December 31, 2023, amounted to €6.166 billion, compared to €6.213 billion as of September 30, 2023, and €6.963 billion as of December 31, 2022, marking an 11% decrease, mainly due to the completion of the non-performing loan (NPL) sale package known as Project Starlight.

The bank's total NPLs decreased significantly in 2023 by over 60% annually, with the balance falling to €464 million from €1.33 billion in 2022, reflecting the completion of Project Starlight. Excluding NPLs covered by the Asset Protection Scheme (APS) provided by KEDIPES, the red loans further reduced to €200 million. The NPL ratio against total loans was 9.5% at the end of 2023, compared to 19.2% at the end of 2022, and excluding loans covered by the APS, the ratio drops to 2.6%.

The Group's NPL coverage ratio was 30% at the end of 2023, and excluding NPLs covered by the APS, the ratio adjusts to 40%, compared to 70% at the end of 2022.

Finally, the bank's real estate portfolio, mostly resulting from debt restructuring arrangements with customers, amounted to €100.4 million at the end of 2023, compared to €130.5 million at the end of 2022. The changes in the inventory in 2023 mainly included additions of €2.2 million and sales of a book value of €24.3 million.