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Hellenic Bank's profit of €365.4 million for 2023

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ΚΕρδος €365.4 εκατ. για το 2023 η Ελη&nu ;ικor Τραπεζα

In 2023 Hellenic Bank had profits of €365 million for the year mainly due to increased interest income from deposits and securities at the Central Bank, as well as due to reduced expenses after the 2022 Voluntary Early Retirement Plan (VEPS).

Financial Highlights

• Strong Capital Position: Common Equity Tier 1 (CET1) 22.8%1 and Regulatory Total Capital Ratio 28.4%1 , well exceeding minimum supervisory requirements

• Reduced balance sheet risk : The NPE Index adjusted for portfolio held for sale was 7.5% while excluding NPEs covered by the Asset Protection Program (APP), it was 2.5%

• The completion of Project Starlight in 2023 marked a new era for the Bank with the sale of NED worth approximately 0.7 billion and APS Debt Servicer

• New borrowing of €1,204 million for the year 2023 , up 2% YoY in line with the target for the year

• Retail focused bank with a solid customer base and significant household market share (37% in deposits and 33% in loans)< /p>

Commenting on the Group's results for the year ended 31 December 2023, Mr. Antonis Rouvas, Interim Chief Executive Officer of the Group, stated:In 2023, Hellenic Bank proved its resilience, with strong results despite the challenges and uncertainty stemming mainly from the geopolitical and economic environment. We achieved remarkable results with profits of €365m for the year mainly due to increased interest income from deposits and securities with the Central Bank, as well as reduced expenses following the 2022 Voluntary Early Retirement Scheme (SEP). The results these confirm the progress that has been made on multiple levels, including our transformation into a customer-centric and technologically advanced bank.

The resilience of our business model was also recognized by international rating agencies, as both Moody's and Fitch upgraded the Bank's long-term deposit rating to Baa3 and BBB- respectively, placing it in investment grade for the first time since the 2013 crisis Furthermore, the decision of one of the largest financial organizations in Greece to invest in Hellenic Bank is a vote of confidence in our business model and franchise, and consequently in the economy of our country.

New lending in 2023 reached €1.2 billion, up 2% year-on-year, marking yet another record year for Hellenic Bank. Funding sectors such as health, education, energy, technology, shipping, hospitality and transport remains a high priority for us, contributing to the competitiveness and productivity of the economy.

Including anticipated earnings for the 1st half of 2023, after approval given by the Supervisory Authorities in accordance with the submissions of regulatory reports, as well as the unaudited profits for the 2nd half of 2023 for which the Bank has not yet received approval from the Supervisory Authorities .

Net Interest Income was €536m, up 78% year-on-year, while non-interest income for 2023 reached €128m, up 26% year-on-year. With an Adjusted Total Capital Ratio of 28.4%, significantly higher than regulatory requirements, and excess liquidity (Liquidity Coverage Ratio at 542%), we remain very well positioned and fully committed to continuing to support our retail and corporate customers in the future.

At the same time, we remain alert to possible risks that could negatively affect the Bank's performance, due to the challenges in the financial and operational environment and the increased geopolitical risk.

Further reducing our NPL ratio remains a top priority for us. Despite the shift of most non-performing loans outside the banking sector, the level of problem loans in Cyprus remains one of the highest in Europe, affecting the country's credit ratings. We welcome the Rent for Rent scheme, which is a favorable arrangement, ensuring housing for vulnerable households and we reiterate our commitment to support our customers in genuine need.

Other highlights of 2023:

• Project Starlight completed as planned. The transaction significantly de-risked the Bank's balance sheet by around €0.7bn, with the NPL ratio, excluding NPLs covered by the Asset Protection Scheme, falling to a low of 2.5% in December 2023 .

• Issuance of Tier 2 Subordinated Notes in the amount of €200 million with a rate of 10.25% in March 2023.

In 2023, our transformation journey to address structural challenges and unlock our full potential remained on track. Decisive steps have been taken towards digitization, further upgrading our digital channels by offering mobile loan products, as well as streamlining our branch network, processes and cost management.

Reaffirming our commitment that corporate responsibility, sustainability and green growth are fundamental pillars for the overall operation of Hellenic Bank, the revised ESG Strategy has become an integral part of the Bank's Strategic Plan, incorporating specific objectives at all levels of our operations. Our aim is

to further enhance the profile of our loan portfolio with healthy expansion and emphasis on ESG (Environment, Society and Corporate Governance).

I want to sincerely thank the Board of Directors and our shareholders for their continued support and assure them that the Hellenic Bank team remains fully committed to achieving its strategic goals. I am also very grateful and proud of the colleagues who remain focused and committed to supporting our customers, executing our challenging transformation plan and continuing to create value for all affected.

Other Keys figures:

• Net interest income for the year 2023 of €536.3 million, up 78% year-on-year

• 99.7% of of new borrowing after 2018 is serviceable

• Cost-to-income ratio2  for the year 2023 at 34% due to higher net interest income and reduced staff costs due to SEPA in December 2022

< p>• Comfortable liquidity, with a Liquidity Coverage Ratio (LCR) at 542% and with €5.8 billion placed at the ECB3, allowing the Bank to benefit from the increase in interest rates

• Net loans ratio to deposits to 39.4%, allowing further business expansion.

Source: www.philenews.com

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