Shares in Eurobank, one of the country’s top four lenders, are standing out in the Athens bourse, outperforming bank and blue-chip indices as the company announced strong earnings earlier this week. After jumping 39.5 percent in the first eight months of the year, the share got off to a strong start in September, adding 2.5 percent to 0.8272 euros on strong volumes.
Eurobank is now in 4th largest company on the bourse in terms of market capitalization, behind Coca Cola HBC, OTE and OPAP. Eurobank is valued at 3.068 billion euros, compared with Alpha Bank's 2.7 billion euros, National Bank's 2.33 billion euros and the 1.75 billion euros of Piraeus Bank.
On Tuesday, the bank announced good results, with CEO Fokion Karavias opening the discussion for the resumption of a dividend distribution from 2022, through consultation with the competent bodies.
A development that, if it goes ahead, will mean a further return to normality for the whole financial system. The main goal is for Eurobank to achieve total profits of 500 million euros in 2022, of which 200 million euros will come from abroad. In the first half of the year, net profits amounted to 195 million euros (+ 10.7%), meaning that in 2021 they may reach 390-400 million euros. Eurobank seems to be one step ahead of the other banks, having moved faster in efforts to consolidate its balance sheet and reduce NPEs. At the same time, it is the Greek bank that maintains a significant presence at an international level, maintaining contact with the markets of tens of millions of potential customers.
In July, Eurobank acquired 9.9% of Hellenic Bank of Cyprus from the Third Point Hellenic Recovery Fund, while it will acquire the additional 2.7% and thus will hold 12.6%. Hellenic Bank is the second largest bank in Cyprus, after Bank of Cyprus, and is active in private, corporate and international banking. Hellenic Bank of Cyprus has 16 billion euros in assets, with 1.12 billion in capital.
In 2020 it achieved profits of 50 million while in the first quarter of 2021 it had profits of 12.9 million euros. Eurobank believes that the Cypriot bank can achieve - in the not-too-distant future - a profit of 100 million euros. At the same time, sources say, the goal is to acquire 20% of Hellenic Bank of Cyprus, if given the opportunity through the departure of other shareholders.
According to the management of Eurobank, this investment is in line with the strategy of further strengthening its presence in key markets in which it maintains strategic interest. For the acquisition of 12.9% of Hellenic Bank of Cyprus, Eurobank will invest a total of about 40 to 43 million euros.
It was the first expansionary move of a domestic banking institution in the last 15 years, during which Greek lenders were forced to liquidate all international holdings due to the financial crisis. Eurobank has also strengthened its presence in Serbia, after acquiring Alpha Bank Bulgaria in 2016 and Piraeus Bank Bulgaria in 2019. Eurobank now has a presence in five countries outside Greece (Bulgaria, Cyprus, Serbia, Luxembourg and the UK).
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