Eurobank Lifts Full-Year Targets as Loan Growth, Fees, and NII Accelerate
Greek lender raises 2026 guidance to RoTE ~17% and NII above €2.7bn, confident despite geopolitical risks
EUROB.AT · Earnings Call · 2026-07-30
A higher bar for 2026
Eurobank is not just beating its own targets — it is lifting them. The Greek lender reported a strong first half 2026, with adjusted net profit of €776 million and return on tangible book value of 16.6%, and management responded by raising its full-year guidance across the board. “We now expect full year 2026 EPS moving higher than our initial estimate, with its growth clearly above the 10% mark, resulting in a return on tangible book value close to 17%, compared with our previous guidance of 16%.” — Fokion Karavias, Chief Executive Officer · 2026-07-30 The optimism is underpinned by accelerating volumes, a resilient fee stream, and benign asset quality — all set against a geopolitical backdrop that would normally warrant caution.
The tourism season both in Greece and in Cyprus is doing very well. In terms of arrivals, we see a very material rebound after a couple of months of moderate pace when the war started.
The macro backdrop remains a push-and-pull. On one hand, geopolitical tensions and persistent inflation keep the global environment fragile. On the other, the economies in Eurobank's core markets have shown remarkable resilience, supported by robust investment and tourism. Greece's recently unveiled €23 billion national development program for 2026–2030 is a tailwind for the banking system, and credit expansion has remained strong across the region.
Volume and fee acceleration
The engine of the beat is balance-sheet growth. Group loans expanded by €1.6 billion in Q2 alone, driving first-half growth to €2.7 billion, a year-on-year pace of 10.5%. Management now sees full-year loan growth of at least €4.5 billion, up from €3.8 billion previously. The increase is broad-based, with Greek corporate lending a key contributor, alongside Bulgaria and Cyprus. Deposit growth was also exceptional, with a €3.1 billion increase in Q2, including €1.4 billion from Greek corporates. This scale of expansion is reflected in the upgraded NII guidance, as the CFO explained: “Based on first half trajectory, we revised upwards our full year NII guidance from EUR 2.6 billion to more than EUR 2.7 billion.” — Harris Kokologiannis, Chief Financial Officer · 2026-07-30 The NIM improved to 248 basis points, and the bank now expects a ~7% year-on-year increase in NII.
Fees were another standout. Group fees rose 13.5% year-on-year, with strength in lending commissions and asset management. The bank revised its full-year fee growth outlook to nearly 10% from 7%. In the Q&A, management noted that the outperformance came from lending fees and AUM, while keeping non-Greek commission income conservative.
Asset quality remains benign
Even as the bank grows, credit costs remain low. The cost of risk was 53 basis points in H1, and the NPE ratio fell to 2.5%. Coverage declined to 82.4%, as expected, driven by the utilization of overlays and a transfer of household loans to held-for-sale. On Swiss franc mortgages, the CEO provided an update: “So far, more than 50% of our balances that are within the perimeter of the law have participated. This is EUR 800 million.” — Fokion Karavias, Chief Executive Officer · 2026-07-30 The average loss is 16-18%, and the bank is fully provisioned for the expected participation.
Capital and returns
CET1 remained steady at 15.4%, with the total capital ratio at 20.3%. The bank continues to execute on its capital return strategy, with payout ratio above 50% and an active buyback. The revised guidance implies a RoTE close to 17%, a clear upward move from the 16% previously. This marks a significant step-up from the prior year's expectations, where the bank was more cautious on NII and growth.
The contrast with prior quarters is instructive. A year ago, the bank was reaffirming a NII target of €2.5 billion, as CFO Harris Kokologiannis stated: “we reaffirm our initial target of EUR 2.5 billion, even assuming the ECB terminal rate reaching 1.5%.” — Charalambos Harris V. Kokologiannis, Chief Financial Officer · 2025-08-01 Now, with rates having stabilized at 2.25%, the bank is raising its target to over €2.7 billion. The loan growth trajectory has similarly exceeded expectations, supported by strong regional demand. The bank's expanding fee base and its progress on the Eurolife disposal — expected to close by end-Q3 — add to the positive momentum. As previously flagged, “We see an envelope of synergies of about €120 million coming from all lines of the income statement.” — Fokion Karavias, Chief Executive Officer · 2024-11-09 That synergy potential, tied to Hellenic Bank, remains a source of upside.
Eurobank's latest results demonstrate that a regional bank can deliver double-digit growth even in a fragile global environment, and the upward revision to guidance is a testament to the strength of its franchise.