Strong Income Growth Boosts NBG's Earnings

Along with cost controls, income growth was a factor in the fourth quarter earnings growth posted by the National Bank of Greece.
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On March 17, 2009, the

National Bank of Greece


reported that its Q4 FY08 earnings increased 6.3% year-over-year, as strong income growth and tight cost controls offset higher charges for bad loans. Net income attributable to shareholders stood at EUR 332.05 million compared to EUR 312.49 million in the prior year's quarter.

The group's net interest income was EUR 945.00 million, up 14.0% from EUR 829.00 million in Q4 FY07, reflecting loan book expansion in the Greece and Southeast European markets. Total group loans increased 17.4% to EUR 66.10 billion from EUR 56.30 billion, reflecting growth of 190.0% in Greece, 27.0% in Turkey, and 37.0% in Southeast Europe. Group deposits grew 12.0% to EUR 67.70 billion. Consequently, its loan-to-deposit ratio stood at 95.0% as of December 2008 compared to 90.0% in prior year's quarter. Moreover, net interest margin remained unchanged at 4.25%.

The ratio of non-performing loans to total loans stood at 3.3% compared to 3.4% a year earlier. However, the group increased its provisions for credit risk more than two folds to EUR 228.00 million from EUR 82.00 million. The bank is well-capitalized by having Tier-I capital adequacy ratio of 10.4% and total capital adequacy ratio of 10.9% at the end of Q4 FY08.

In January 2009, NBG increased its share capital by EUR 350.00 million through the issue of 70.00 million redeemable preference shares with par value of EUR 5.00 each.

Net income attributable to NBG shareholders for FY08 decreased 4.9% to EUR 1.55 billion from EUR 1.63 billion in the previous year. Interest income grew 17.0% to EUR 3.60 billion, reflecting growth of loan book in Greece and abroad.