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PIRAEUS BANK 9M.2020 FINANCIAL RESULTS 23 November 2020

Transcript of PIRAEUS BANK 9M.2020 FINANCIAL RESULTS/media/Com/2020/Files/...0 500 1,000 1,500 2,000 2,500 3,000...

  • PIRAEUS BANK9M.2020 FINANCIAL RESULTS23 November 2020

  • 01 Executive Summary

    02 Financial Performance

    03 Appendix

    9Μ.2020FINANCIALRESULTS

  • 9Μ.2020FINANCIALRESULTS

    01Executive Summary

  • 0

    500

    1,000

    1,500

    2,000

    2,500

    3,000

    3,500

    4,000

    4,500

    Jan

    uar

    y

    Feb

    ruar

    y

    Mar

    ch

    Ap

    ril

    May

    Jun

    e

    July

    Au

    gust

    Sep

    tem

    ber

    Oct

    ob

    er

    No

    vem

    ber

    Dec

    emb

    er

    2019 2020

    59% of total 12% of total 25% of total (average ‘17-19)

    9M.20 revenues

    €3.5bnor -78% yoy

    GREEK ECONOMY: LATEST DEVELOPMENTS01

    Executive Summary

    Source: ELSTAT, Bank of Greece, European Commission DG-ECFIN, Piraeus Bank Research

    Economic sentiment evolution

    Travel revenues’ distribution across quarters

    • The economy has restarted as of early May post lockdown, butNovember second lockdown has set a pause

    • Unprecedented policy response to address Covid-19 impact

    • Economic sentiment index points to a milder vs Euroarea impact for theGreek economy, but also a slower recovery to-date

    • The development of revenue from tourism is crucial for Greece’s 2020 -21 GDP

    • Fiscal stimulus of €80bn for the period 2021-2027 will support recovery,boosting jobs and growth

    €mn

    Nov.2091.0

    Nov.2087.6

    60

    70

    80

    90

    100

    110

    120

    Jul-

    12

    No

    v-12

    Mar

    -13

    Jul-

    13

    No

    v-13

    Mar

    -14

    Jul-

    14

    No

    v-14

    Mar

    -15

    Jul-

    15

    No

    v-15

    Mar

    -16

    Jul-

    16

    No

    v-16

    Mar

    -17

    Jul-

    17

    No

    v-17

    Mar

    -18

    Jul-

    18

    No

    v-18

    Mar

    -19

    Jul-

    19

    No

    v-19

    Mar

    .20

    Jul.2

    0

    No

    v.20

    ESI - Greece ESI- Εuroarea

    0

    2,000

    4,000

    6,000

    8,000

    10,000

    12,000

    14,000

    16,000

    18,000

    20,000

    Jan

    Jan

    -Feb

    Jan

    -Mar

    Jan

    -Ap

    r

    Jan

    -May

    Jan

    -Ju

    n

    Jan

    -Ju

    l

    Jan

    -Au

    g

    Jan

    -Sep

    Jan

    -Oct

    Jan

    -No

    v

    Jan

    -Dec

    20192020

    Private building activity (number of permits)

    Real Estate FDI in Greece (€mn, annual cumulative flows)

    156239

    153222

    415

    1,128

    1,450

    58115 9190

    148

    379

    737

    371

    0

    200

    400

    600

    800

    1,000

    1,200

    1,400

    1,600

    2013

    2014

    2015

    2016

    2017

    2018

    2019

    H1

    .13

    H1

    .14

    H1

    .15

    H1

    .16

    H1

    .17

    H1

    .18

    H1

    .19

    H1

    .20

  • 201917.3

    18.1

    17.1

    0.0

    5.0

    10.0

    15.0

    20.0

    25.0

    30.0

    20

    012

    002

    20

    032

    004

    20

    052

    006

    20

    072

    008

    20

    092

    010

    20

    112

    012

    20

    132

    014

    20

    152

    016

    20

    172

    018

    20

    192

    020

    (f)

    20

    21 (

    f)

    20191.6

    -8.0

    4.8

    -10.0

    -8.0

    -6.0

    -4.0

    -2.0

    0.0

    2.0

    4.0

    6.0

    8.0

    20

    012

    002

    20

    032

    004

    20

    052

    006

    20

    072

    008

    20

    092

    010

    20

    112

    012

    20

    132

    014

    20

    152

    016

    20

    172

    018

    20

    192

    020

    (f)

    20

    21 (

    f)

    Real GDP growth rate

    PB forecast

    GREEK ECONOMY: CAUTIOUSLY OPTIMISTIC OUTLOOK02

    Executive Summary

    Real GDP % annual change

    Unemployment % of labor force

    Residential Real Estate% annual change

    • Baseline scenario for a total -3%

    contraction in the period 2020-

    2021

    • 9M.20 released data for real GDP

    show a severe recession effect

    • For unemployment and

    residential real estate a

    slowdown effect is likely

    Commercial Real Estate% annual change

    Source: Bank of Greece, ELSTAT, Piraeus Bank Research; 2019-2020 outlook: Piraeus Bank Research

    H1.202.0

    -14.0-12.0-10.0

    -8.0-6.0-4.0-2.00.02.04.06.08.0

    10.012.014.0

    H1

    .11

    H2

    .11

    H1

    .12

    H2

    .12

    H1

    .13

    H2

    .13

    H1

    -14

    H2

    -14

    H1

    -15

    H2

    -15

    H1

    -16

    H2

    -16

    H1

    -17

    H2

    -17

    H1

    .18

    H2

    .18

    H1

    .19

    H2

    .19

    H1

    .20

    9M.20 (actual) -8.5% yoy

    Q3.203.2

    -14.0-12.0-10.0

    -8.0-6.0-4.0-2.00.02.04.06.08.0

    10.012.014.0

    Q1.

    11

    Q4.

    11

    Q3.

    12

    Q2.

    13

    Q1.

    14

    Q4.

    14

    Q3.

    15

    Q2.

    16

    Q1.

    17

    Q4.

    17

    Q3.

    18

    Q2.

    19

    Q1.

    20

    Q2.

    20

    9M.20 (actual) 4.6% yoy

    2019 (actual) 4.1% yoy

    9M.20 (actual) 16.2%

  • FUNDING WORTH ~40% OF GREEK GDP AVAILABLE IN THE NEXT 7 YEARS03

    Executive Summary

    amounts in €bn TOTALNext

    Generation EU (N GEU)

    National Strategic Reference

    Framework (ESPA)

    Common Agricultural Policy

    2021-2027

    National Development Programme

    Competitive economy & digital transition 29 24 4 - 1

    Direct payments 14 - - 14 -

    Environment, energy 10 4 5 - 1

    Infrastructure & transportation 9 3 3 - 3

    Employment, education & social protection 9 1 6 - 1

    Rural development 4 - - 4 -

    Regional programmes 2 - - - 2

    Spatial interventions & urban development 2 - 1 - 1

    Reserve 1 - - - 1

    Market measures 1 - - 1 -

    Total 80 32 20 19 10

    Source: Ministry of Development, Ministry of Rural Development & Food, Piraeus Bank Research

    • The EU Recovery Fund will allow Greece, to cover the ground lost due to the Covid-19 pandemic, and also to lift its long-term growth

    trend, as well to proceed structural reforms, through a specific plan required by EC, and targeted productivity enhancing investments

    • The support can be up to 17%-18% of GDP, approximately €32bn. As this initiates, it will mean that starting from mid-2021 and spreadover the next 4 years, the Greek economy’s public investment resources may expand by more than 4% of GDP per annum

    • Impact to GDP growth for the forthcoming years expected to be 1.5%-2.5% per annum

  • EXECUTIVE SUMMARY

    OUR RESPONSIVENESS TO SUPPORT OUR CLIENTS AND EMPLOYEES04

    Executive Summary

    €5.4bn €4.2bn €2.2bn

    • new loans to clients year-to-date

    • implemented debt moratoria for PEs

    • allocation to client financing programs sponsored by the State

    498100% operational

    • branches fully operational throughout

    2nd lockdown

    5.5mn

    • active customers, with +95k new additions in

    9M.20

    94% digital transactions

    • 600k customers transacting online per week, +26% yoy

    86 TRI*Mindex

    • client satisfaction ranking in the top 10% of European banking benchmark

    81% pulse survey

    • employee satisfaction with Bank’s responsiveness to Covid-19 crisis

    *data as of mid November 2020; TRI*M index measures the strength of the relationship between the customer and the Bank

  • 05 NOTABLE OPERATING & FINANCIAL PROGRESS

    Executive Summary

    Performing Loans Group, €bn

    New Loan Production Group, €bn

    NII & NFI Group-recurring, €mn

    Total Capital Ratio Phased-in, %

    NPEs Group, €bn

    Deposits (private sector) Group, €bn

    Operating ExpensesGroup-recurring, €mn

    Employees Greece, #

    24.2 24.125.8

    9M.18 9M.19 9M.20

    28.5

    25.7

    22.7

    9M.18 9M.19 9M.20

    2.0

    3.2

    4.5

    9M.18 9M.19 9M.20

    38.040.4

    43.8

    9M.18 9M.19 9M.20

    12.3k 11.4k 10.9k

    9M.18 9M.19 9M.20

    1,054 1,0721,10

    7

    215 227 231

    9M.18 9M.19 9M.20

    13.7%15.2% 16.1%

    9M.18 9M.19 9M.20

    765711

    650

    9M.18 9M.19 9M.20

    1,269 1,2991,339

    NII

    NFI

    * 9M.20 OpEx excludes fixed fee paid to NPE servicer; employee number for continued operations

  • 9M.2020 FINANCIAL TAKEAWAYS06

    Executive Summary

    Business Performance

    • NIM of 2.2%

    • New loan production at 3.7% yield

    • Funding costs substantially improved

    • NFI over assets at 0.5%

    • 94% of revenues from NII & NFI

    Cost Efficiency

    • OpEx decrease 9% yoy

    • C:I at 48%

    • 1,000 VES applications received to-date,

    c.€40mn expected

    annual savings

    • c.30 branch closures during 2020 to-date

    Covid-19Impact

    • Covid-19 impairments of €362mn

    • Reflection of the revised macroeconomic

    estimates to IFRS

    impairment assessment

    already booked in

    Q1.2020

    Capital &Liquidity

    • LCR 157%, LDR 81%

    • Capital ratio 16.1%

    • CET1 ratio 14.1%

    • Capital actions of c.€1bn underway to further

    enhance capital position

    and facilitate accelerated

    NPE derisking

    * OpEx decrease on a like-for-like basis, as defined in the APMs section

  • FINANCIAL PERFORMANCE

    07 9M.20 EXHIBITS SOLID OPERATING TRENDS

    Group (€mn) 9M.19 9M.20 yoy

    Net Interest Income 1,072 1,107 3%

    Net Fee Income 227 231 2%

    Core Banking Income 1,299 1,339 3%

    Trading & Other Income 62 79 28%

    Total Net Revenues 1,361 1,417 4%

    Total Operating Costs (749) (686) -8%

    Total Operating Costs (like-for-like) (711) (650) -9%

    Pre Provision Income 612 732 20%

    Pre Provision Income (like-for-like) 650 767 18%

    Impairments (502) (845) 68%

    o/w related with CVD-19 - (362) -

    Associates Income (0) (19) -

    Pre-Tax Result 110 (133) -

    Pre-Tax Result (recurring) 146 229 57%

    Note: like-for-like items are displayed in the APM section of the presentation; recurring pre-tax result excluding Covid-19 impact in 2020 and VES costs in 2019

    Executive Summary

    • Νet interest income at €1,107mn, +3% yoy, mainly on the back of improving funding costs and increased fixed income

    holdings

    • Net fee income at €231mn, +2% yoy, helped by new loan generation, asset management, investment banking and

    bancassurance

    • Operating costs continued their downward trend as per the Bank’s strategy (-9% yoy like-for-like)

    • 150bps of underlying cost of risk in 9M.20

    • 77bps Covid-19 loan impairment (non-annualized) mainly booked in Q1.20, incorporates the impact of the revised

    macroeconomic assumptions

    • Excluding Covid-19 impact of €362mn, pre tax profit amounted to €229mn in 9M.20, while incorporating this, it

    stood at a loss of €133mn

  • FINANCIAL PERFORMANCE

    08IMPROVEMENT IN FINANCIAL KPIS

    WITH NORMALISATION IN NIM AS EXPECTED

    Executive Summary

    Group 9M.19 9M.20

    NIM 2.4% 2.2%

    NFI/Assets 0.5% 0.5%

    Cost/Income 52% 48%

    Pre Provision Income/RWA 1.8% 2.2%

    LDR 84% 81%

    LCR 107% 157%

    Total Capital | phased-in 15.2% 16.1%

    Total Capital | fully loaded 12.5% 13.7%

    RWA Density 78% 64%

    • NIM at 2.2% over an expanded asset base

    • NFI over assets at 0.5% in line with plan for enhanced fee income generating business

    • Significant cost cutting effort displayed in lower cost-to-income (48%), mainly on the back of

    reduced staff costs

    • Pre provision income/RWA enhanced, indicating the strength of core Piraeus Bank

    franchise

    • Positive total capital trajectory on the back of solid operating income trends and RWA

    ongoing optimization, helped by the increasing

    contribution of sovereign fixed income holdings

    from a very low starting point

  • 82

    460

    -234

    22735 262

    -159

    103

    -21

    CoreRevenues

    Operating Costs

    Core PPI OtherIncome

    PPI Impairments Pre TaxResult(rec.)

    Cvd-19Impairments

    Pre TaxResult

    125

    447

    -225

    22263 285

    -143

    142

    -17

    CoreRevenues

    Operating Costs

    Core PPI OtherIncome

    PPI Impairments Pre TaxResult(rec.)

    Cvd-19Impairments

    Pre TaxResult

    80

    367

    09PROFITABILITY IN Q3.20 DRIVEN BY

    IMPROVEMENT IN ALL CORE P&L LINES

    Executive Summary

    Q1.20 Result | €mn Q3.20 Result | €mn

    * includes associates’ result

    -202-340

    431

    -227

    204

    -19

    185

    -16-324

    CoreRevenues

    Operating Costs

    Core PPI OtherIncome

    PPI Impairments Pre TaxResult(rec.)

    Cvd-19Impairments

    Pre TaxResult

    71

    360NII

    NFI

    Q2.20 Result | €mn81

    380NII

    NFI

    NII

    NFI

    Steady increase of core revenues, NII and NFI

    Tight operating costs control to further intensify

    Stabilization of organic impairments post Covid-19 charges in Q1

    qoq impactedby non-core P&L lines

  • (0.5) (0.5) (0.5)

    (0.3) (0.3) (0.2)

    10 CONTAINED NPE INFLOWS LED TO €0.3BN NEGATIVE FORMATION IN Q3.20

    Executive Summary

    10.2

    11.4 collateral

    provisions

    0.2 0.1

    0.2 0.1 0.1

    95%

    37.7 36.5 35.832.9

    27.324.5 24.1

    23.3 22.7

    Sep.15 Dec.15 Dec.16 Dec.17 Dec.18 Dec.19Mar.20 Jun.20 Sep.20

    Group NPE development | €bn

    Coverage

    - €15.0bn

    Bank NPE movement | €bn

    Re-defaults

    Defaults

    Curings,Collections,Liquidations

    Write-offs

    Q1.20

    NPE 23.7 23.0

    Q2.20

    • curings as planned• lower liquidations

    peak€130mn inflows

    0.1

    Q3.20

    22.3

  • 11 PREPARATIONS FOR €7BN NPE SECURITISATIONS

    Executive Summary

    “Vega”

    “Phoenix”

    Note: senior tranches estimated based on latest perimeter information, pending rating confirmations

    Retain 100%Senior Note

    Gross Loans~€5.0bn

    Junior

    Mezzanine

    Senior~€1.4bn

    Retain at least 5% of

    Mezz & JuniorNotes

    Retain 100%Senior Note

    Gross Loans~€1.9bn

    Junior

    Mezzanine

    Senior~€1.0bn

    Retain at least 5% of

    Mezz & JuniorNotes

    • The transaction will apply for the HAPS guarantee

    • €1bn relates to mortgages and €4bn to commercial exposures

    • The portfolio securitised in 3 SPVs (Vega I - II - III) to provide flexibility

    • Business plan completed, pre-rating process initiated

    • Targeted signing for transaction within Q1.2021

    • Application for the HAPS guarantee on the Senior Note submitted inearly Aug.20 for the €1.9bn mortgage NPE transaction

    • Commitment letter with Intrum AB for the purchase of 30% of Mezz andJunior notes. Distribution of 65% of the notes to the Bank’s shareholders

    • Legal documentation to be concluded by the end-2020

    • Preparation for dividend-in-kind process

    • Targeted signing for transaction within Q1.2021

  • EXECUTIVE SUMMARY

    CORPORATE HIVE-DOWN PROCESS AT FINAL PHASE

    The corporate hive-down plan includes:

    Piraeus banking operations will be hived-down to a new wholly owned banking subsidiary (“NewCo”)

    Certain non-banking activities will remain with the parent entity, which will evolve into a financial holding company (“HoldCo”)

    In the context of the hive-down, all necessary preparations for €7bn NPE securitizations are taking place

    The NewCo will hold no less than 5% of the Junior and Mezzanine Notes of the securitizations as required

    The transformation balance sheet is based on the 31 July 2020 financial data

    The corporate hive-down plan is subject to all the approvals by the relevant regulatory bodies and the GM of the Bank’s shareholders

    12

    Key steps

    SPV setupJul.20

    Expected demerger date30 Dec.2020

    Derecognition of NPEsQ1-Q2.21

    Executive Summary

    Transformation B/S31 Jul.20

    EGM approved HD10 Dec.2020

  • MEASURES TO SUPPORT COVID-19 IMPACTED CUSTOMERS13

    Executive Summary

    Total client support measures | €bn

    Programme Sponsor Program BeneficiariesPiraeus Bank

    share

    Hellenic Development Bank

    Entrepreneurship Fund II

    (“ΤΕPΙΧ ΙΙ”): Interest rate subsidy

    (“new money”)

    Impacted SMEs

    ~€0.6bnfunding

    Guarantee Fund(“new money”)

    SMEs & Corporates

    ~€1.6bn funding

    Ministry of Development & Investments

    Interest rate subsidy outstanding lending

    facilities

    ImpactedSMEs

    ~€1.8bn under

    subsidy

    Ministry of Finance

    Installment Subsidy (“Gefyra”)

    outstanding primary residence mortgages

    Eligible impacted

    individuals, professionals

    ~€1.7bnunder

    subsidy

    State schemes for financing support to clients

    new loans under State

    schemes

    €2.2bn Total Financing €3.5bn Total subsidized loans

    5.3

    1.7

    1.8

    1.0

    0.4

    Debt moratoria

    Gefyra mortgagesubsidy program

    SME subsidyprogram

    Guarantee Fund

    TEPIX II2nd phase

    €0.2bn

    2nd phase €0.6bn

    underprocessing

    * debt moratoria refer to Bank data as of Sep.20

  • 14 DEBT MORATORIA INFORMATION

    Executive Summary

    Debt moratoria decomposition | €bn

    FNPE

    PE

    SME & SB

    Corporate

    Mortgages

    €5.3bn

    Consumer

    Business PE moratoria per sector | €bn

    0.9

    0.6

    0.3

    0.3

    0.2

    Hospitality and F&B

    Transport & Logistics

    Trade

    Manufacturing

    Real Estate &Construction

    * debt moratoria refer to Bank data as of Sep.20

    €5.3bn

    • Demand for debt moratoria flattened

    €4.2bn PE moratoria, split equally between households (€1.9bn) and businesses (€2.3bn)

    €1.1bn moratoria provided to FNPE customers with

  • 15 Q3.2020 COVID-19 DEBT MORATORIA EVOLUTION

    Executive Summary

    4.8 +0.6

    -2.9

    +0.6

    3.0

    2.3

    ActiveJun.2020

    Granted Expired Expiredopted forextension

    ActiveSep.2020

    Expirednot opted for

    extension

    • Out of the €5.3bn total implemented moratoria, both PE & FNPE, at the end of Sep.2020:

    €3.0bn were active

    €2.3bn had expired and not opted for extension

    • During Q3.2020, €2.9bn of debt moratoria have expired, of which:

    €1.7bn show no arrears

    €0.6bn show early arrears

    €0.6bn have opted for extension

    Q3.2020 implemented debt moratoria evolution | €bn

    * debt moratoria refer to Bank data as of Sep.20

  • 16 COVID-19 DEBT MORATORIA MANAGEMENT STRATEGY

    Executive Summary

    4.2

    0.6

    0.5

    1.4

    0.7

    1.0

    PE moratoria

    GefyraProgram

    State supportschemes

    Banksolutions

    Naturalcurings

    PotentialNPE inflow

    • A bottom-up assessment for loans under debt moratoria has taken place for commercial customers, assuming moratoria expire at the end of 2020, with the exception of hospitality sector

    • Maximization of the utilization of State support schemes funding

    • c.40% of Gefyra program eligible borrowers under moratoria

    • Targeted solutions per industry offered by the Bank for a smooth transition post the expiration of moratoria

    • Actions are expected to reduce potential inflows to c.€1bn, or c.25% of PE debt moratoria (gross figure)

    Performing debt moratoria management | €bn

    Assumedgross inflows

    * debt moratoria refer to Bank data as of Sep.20

    State sponsored schemes

    Bank management

  • 17CREDIT ORIGINATION IN GREECE PICKING-UP

    TO FACILITATE DEMAND

    33.9

    31.7

    26.5

    23.7 23.4 22.621.9

    Dec.16 Dec.17 Dec.18 Dec.19 Mar.20 Jun.20 Sep.20

    27.4

    24.9

    23.9 23.7 24.124.5

    25.4

    Dec.16 Dec.17 Dec.18 Dec.19 Mar.20 Jun.20 Sep.20

    Performing exposures | €bn

    Non-performing exposures | €bn

    14.0 13.7 13.8 14.314.7 15.5

    Dec.17 Dec.18 Dec.19 Mar.20 Jun.20 Sep.20

    PE business loans | €bn PE individuals loans | €bn

    10.9 10.2 9.8 9.8 9.9 9.9

    Dec.17 Dec.18 Dec.19 Mar.20 Jun.20 Sep.20

    * year-end loan figures exclude seasonal agri-loan

    Executive Summary

    • The elevated liquidity demand by the market due to Covid-19 outbreak has been facilitated by the banking sector

    • Piraeus Bank has maintained its leading position with regards to performing loan balances which have increased by €1.7bn year-to-date

  • EXECUTIVE SUMMARY

    STRONG LIQUIDITY & FUNDING POSITION 18

    Executive Summary

    Domestic deposits | €bn

    Interbank funding | €bn

    • Domestic private sector deposit balances increased by €2.3bn year-to-date in 9M.20

    • Domestic private sector deposits grew 9% yoy at the end of Sep.20

    • New time deposit costs

  • 19 IMPROVEMENT IN CAPITAL ADEQUACY

    Executive Summary

    • Post supervisory flexibility provided to

    European banks to operate below combined

    buffers in reaction to Covid-19, the capital

    requirement has been effectively set to

    11.25% until end-2022

    • The change of P2R mix as per CRD V has

    provided European banks with more flexibility

    €bn | % Sep.20 Sep.20

    CET-1 Capital 6.1 4.9

    Total Capital 7.0 5.8

    RWAs 43.6 42.4

    CET-1 ratio 14.1% 11.6%

    Total ratio 16.1% 13.7%

    Capital ratio

    SREP capital requirement

    • Increase of capital ratio by ~13bps in Q3.20 to

    16.1%

    • Significant improvement of RWA density to

    64% vs 78% a year ago

    % 2020 2020

    Pillar 1 CET1 4.50% 4.50%

    Pillar 2 Requirement (P2R) 3.25% 1.83%

    Capital Conservation Buffer (CCB) 2.50% -

    Other Systemically Important Institutions 0.50% -

    CET-1 Requirement 10.75% 6.33%

    Additional Tier 1 1.50% 2.11%

    Tier 2 2.00% 2.81%

    Overall Capital Requirement (OCR) 14.25% 11.25%

    Phased-In Fully Loaded

    reported

    effective requirementpost July 2020

    ECB communication

  • 15.6%

    -0.5% -0.6%

    +1.1% +0.3% +0.6%

    -0.3%

    16.1%

    Dec.19 IFRS9phasing

    Cvd-19impact

    T2issue

    9M.20result

    RWAimpact

    Otheradjustments

    (eg. DTA)

    Sep.20

    RESILIENT REGULATORY CAPITAL LEVEL20

    10.7%12.2% 12.9%

    13.5% 13.7%

    10.2%

    Jun.18 Dec.18 Jun.19 Dec.19 Jun.20 Sep.20

    Total regulatory capital (fully loaded)

    +350bps

    • 9M.20 regulatory capital ratio drivers include (apart from regulatory

    adjustments):

    €0.1bn organic capital generation

    from P&L and reserves

    €0.3bn Covid-19 impact (Q1)

    €0.5bn Tier2 issuance (Q1)

    €1.3bn RWA relief (incl. SME &

    infrastructure lending factors)

    Total regulatory capital (phased in)

    • Capital enhancement plan executed since mid-2018 included internal generating

    actions, NPE servicer deal & Tier 2 issues,

    adding 350bps to capital

    +210bps from T2 issuance

    +140bps from organic actions

    Executive Summary

  • EXECUTIVE SUMMARY

    CONTIGENT CONVERTIBLE SECURITY

    Latest developments & expected impact

    ECB and subsequent Piraeus BoD decisions will lead to non-payment of CoCo coupon in December and conversion of the €2bn CoCo into Piraeus ordinary shares, as per terms of securities

    394mn new shares will be issued based on 2015 recapitalization subscription price (calculated at €6.00 currently)

    HFSF shareholding will increase to 61% from 26% currently

    Tangible book value increase by €2bn

    The fully discretionary non-payment of the coupon and the resulting CoCo conversion do not constitute a default in payment and do not trigger any cross-default clauses

    The enhanced capital trajectory is expected to accelerate the Bank’s NPE reduction strategy in the forthcoming period

    21

    Key steps

    Cancellation ofcoupon

    Introductionof new shares in ATHEX

    Executive Summary

    Conversion & issuanceof new shares

  • EXECUTIVE SUMMARY

    Capital enhancing actions Benefit (est.) Timing (est.)

    A. Cards merchant acquiring business carve-out ~€0.3bn Q1

    B. Performing loan synthetic securitization ~€0.3bn Q1, Q4

    C. Participations portfolio reorganisation ~€0.1bn Q1

    Plus 2020-2021 CoCo coupon savings ~€0.3bn Q4

    Subtotal ~€1.0bn 2021

    E. Unrealized profits in securities portfolio ~€0.4bn

    F. Debt capital markets issuance ~€0.6bn

    Total ~€2.0bn

    Capital position to be strengthened by the end-2021 through a combination of strategic initiatives

    CAPITAL ENHANCING ACTIONS UNDER WAY

    Executive Summary

    Capital actions to provide additional buffer of

    c.€1bn on top of the Bank’s debt issuance plan as

    following:

    • Cards acquiring business carve-out: competitive

    sale process launched, NBOs received, BOs

    expected in Q1.21

    • Synthetic securitization: PE loan size

    corresponding to ~€2bn RWA, execution in 2

    tranches, for the first one VDR opened, NBOs

    expected in late Q4.20

    • Participations portfolio: assignment of c.€0.4bn

    portfolio management to third-party

    • CoCo coupon savings

    Indicatively, such actions could facilitate c.€5bn

    of extra NPE derecognition by the end of 2021

    22

  • 23 PIRAEUS BANK’S TRANSFORMATION PROGRAM

    Executive Summary

    Implementation of a transformation program, capitalizing on the progress of 2017-2019, aiming a fresh & agile business model

    • Step up the commercial proposition,

    boosting origination via digital and

    automation, fully exploiting high-potential

    businesses

    • Become the Bank of choice, through a

    customer centric, digitally enabled and

    targeted segment value proposition

    • Enhance and empower the Bank’s talent

    through a leaner and more rewarding

    staffing profile

    • Promote simplification and end-to-end

    automation across the board to lower cost

    to serve and free-up commercial focus

    Design phase concludedend Sep.2020

    HR and talent management

    Technology and data management

    Funding structure and securities portfolio5

    6

    7

    Efficiency and simplification

    Commercial customer proposition

    Retail customer proposition

    2 3 4Asset quality and

    de-risking

    1

    Strategic initiativesalready under way

  • 24

    Leaner

    >€150mn cost reduction(~20% drop)

    Diversified

    ~30-70% NFI/NII mix (from ~20-80%)

    Productive

    Growth in volumes and core revenues /

    FTE

    Focused

    >50% of branch time dedicated to revenue generating activities

    Digital

    3x increase in remote sales (from ~7% to

    >20%)

    De-risked

    Single-digit NPE ratio (from ~47%)

    Innovative

    increase IT time invested in change initiatives

    by 35%

    Executive Summary

    2020

    • Program kicked-off in May & its design phase concluded in September

    • Bottom-up approach with 17 initiative themes, >200 projects, >100 operational key value

    drivers

    • 1,000 FTEs utilizing VES program; expected savings of c.€40mn per annum

    • Reduction of network by 40 branches

    • New IT sourcing model (“factories”) kicked-off

    • Further footprint rightsizing by 25 branches & operational model revamp

    • Sales capabilities boost (digital & remote sales, commercial time increase, etc)

    • Headquarters & back-office transformation

    • Lending process redesign

    • G&A savings of c.€15mn reallocated towards IT investment

    • IT transformation & factories roll out

    PIRAEUS BANK’S TRANSFORMATION PROGRAM

    Full-scale engagement during the design phase, shaping collectively the underlying strategic directions of the Program

    2021

  • 0.7k 0.9k

    2.5k

    1-year before 2020pre lock-down

    2020 post March lock-

    down to date

    25 DIGITAL BANKING BEHAVIOUR STANDING OUT

    Executive Summary

    Online registrations per week Customers transacting online per week winbank transactions penetration

    89% 90%94%

    1-year before 2020pre lock-down

    2020post March lock-

    down to date

    400k440k

    520k

    1-year before 2020pre lock-down

    2020post March lock-

    down to date

    Increase in winbank online registrations

    3x to 328k ytd

    More people transacting online and more often

    600k users login/week

    Increasing winbank penetration to cash

    transactions

    +21% in payments

  • 9Μ.2020FINANCIALRESULTS

    02Financial Performance

  • 26 ASSETS & LIABILITIES OVERVIEW

    • Loan-to-Deposit ratio at 81% and LiquidityCoverage ratio at 157%

    3.9

    6.5

    0.32.1

    38.3

    1.3

    7.3

    8.0

    2.1

    7.6

    47.1

    1.40.5

    9.0

    Other*

    Cash

    AssetMix

    Total

    Securities

    Net Loans

    Fixed Assets

    67.7

    amounts in €bn

    Total

    ECB

    Interbank Repos

    Deposits

    Total Equity

    Other

    67.7

    FundingMix

    Sep.20 Sep.20

    Debt Securities

    • Funding mix enhanced on the back of thedecision to utilize lower Eurosystem fundingcosts and switch interbank repo positions toECB TLTRO funding

    • Customer deposits comprise 70% of liabilities and equity

    • Customer loans comprise 57% of assets

    (*) Other includes “other assets” (€3.6bn) and “goodwill & intangible assets” (€0.3bn)

    Interbank Loans

    DTA

    Disc’d Ops & Held for Sale

    Financial Performance

    • Increase of ~€3bn ytd in fixed income portfolio; higher GGB holdings post the lift of the 2015 supervisory cap in early Mar.20

    • €0.9bn Tier 2 issued in 2019 & 2020 with afocus on capital enhancement

  • 27 BALANCE SHEET EVOLUTION

    Group, €mn Sep.19 Jun.20 Sep.20 yoy

    Cash/Interbank 3,757 7,267 9,212 >100%

    Net Loans 37,953 37,792 38,280 1%

    Securities 4,334 6,428 7,336 69%

    Other Assets 13,046 12,895 12,865 -1%

    Total Assets 59,089 64,382 67,693 15%

    Interbank 3,032 7,583 9,445 >100%

    Deposits 45,172 45,706 47,088 4%

    Debt Securities in Circulation 925 1,369 1,386 50%

    Other Liabilities 2,202 2,077 2,126 -3%

    Equity 7,758 7,648 7,648 -1%

    Total Liabilities & Equity 59,089 64,382 67,693 15%

    4.9 5.1 5.1 5.2 5.3 5.3 5.1 5.2 5.2

    Sep.18 Dec.18 Mar.19 Jun.19 Sep.19 Dec.19 Mar.20 Jun.20 Sep.20

    Tangible Book Value | €bn

    Liquidity Coverage Ratio | %

    28%61% 67%

    99% 107%117% 131%

    169% 157%

    Sep.18 Dec.18 Mar.19 Jun.19 Sep.19 Dec.19 Mar.20 Jun.20 Sep.20

    Financial Performance

    impacted by Covid-19

    impairments

  • LIQUIDITY

    40.9 +0.5 +0.5 +0.8+1.8 44.5

    -0.9

    +1.1 +0.2+2.2 47.1

    -0.6 -0.9

    +1.4 46.9

    Dec.17 Δ Q1.18 Δ Q2.18 Δ Q3.18 Δ Q4.18 Dec.18 Δ Q1.19 Δ Q2.19 Δ Q3.19 Δ Q4.19 Dec.19 Δ Q1.20 Δ Q2.20 Δ Q3.20 Sep.20

    27% 27%

    73% 73%

    Sep.20 Sep.20

    Business Retail

    34% 30%

    66% 70%

    Sep.20 Sep.20

    Time deposits Savings-Sight deposits

    Domestic deposit mix (%) Deposit movement by segment (€bn)

    Greek market Piraeus - Greece Greek market Piraeus - Greece

    Customer deposit movement in Greece (€bn)

    PiraeusFY.18delta

    FY.19delta

    Q1.20delta

    Q2.20delta

    Q3.20delta

    Sep.20 balance

    Mass|Farmers +1.1 +1.1 - - +0.1 18.0

    Affluent|Private Banking +1.0 - - - -0.1 15.3

    SB -0.1 +0.7 +0.1 +0.3 +0.4 4.6

    SME - +0.2 +0.2 -0.1 +0.3 1.7

    Corporate - +0.1 +0.3 +0.1 +0.3 3.4

    Govt & Other +1.6 +0.5 -1.2 -1.2 +0.4 3.9

    Total +3.6 +2.6 -0.6 -0.9 +1.4 46.9

    28 DOMESTIC DEPOSITS

    Financial Performance

    -€2.4bn ytd from State deposits

  • 29 NET INTEREST INCOME BENEFITING FROM LOWER FUNDING COSTS

    Νet interest income resilient in Q3.20 at €380mn, increase by

    3% qoq. NII, on a yearly basis, also increased by 3% in 9M.20

    Customer deposit costs trending lower, as well as reduced

    cost of wholesale funding (Eurosystem and market repo)

    Improvement mainly from the liability side and funding costs

    Increase of fixed income portfolio in Eurozone sovereign

    bonds supports NII

    Impact from loan portfolio de-risking and mild yield

    compression is reflected in loan interest income, yet front

    book comes at higher rates vs stock

    NIM slightly lower qoq on the back of the inflated asset size

    Q2.20 Q3.20

    Net Loans 395 399

    Fixed Income Securities 25 27

    Other Assets 32 36

    Interest Income 452 463

    Customer Deposits 24 19

    Due to Banks 1 1

    Debt Securities 19 19

    Other Liabilities 42 45

    Interest Expense 85 83

    Net interest Income 367 380

    NIM 1 2.3% 2.2%

    1. on assets excluding discontinued operations

    Net interest income decomposition (€mn)

    Financial Performance

  • FINANCIAL PERFORMANCE

    Q3.19 Q4.19 Q1.20 Q2.20 Q3.20

    Deposits 0.39% 0.33% 0.24% 0.18% 0.15%

    Sight 0.46% 0.44% 0.27% 0.19% 0.18%

    Savings 0.05% 0.05% 0.04% 0.03% 0.03%

    Time 0.65% 0.51% 0.43% 0.35% 0.27%

    avg 3m euribor

    -0.40% -0.40% -0.41% -0.30% -0.47%

    Loans 3.27% 3.29% 3.35% 3.29% 3.24%

    Mortgages 1.97% 1.93% 1.92% 1.91% 1.89%

    Consumer 6.97% 7.33% 7.43% 7.56% 7.30%

    Business 3.46% 3.50% 3.59% 3.49% 3.44%

    Actual rates shown above refer to total Greek banking operations, quarterly averages

    Time deposit rate declines further, resiliency in loan rates

    Loan Rates

    Q3.20 Total Stock Front Book

    Mortgages 1.9% 2.5%

    Consumer 7.3% 9.8%

    Business 3.4% 3.4%

    Total 3.2% 3.6%

    Loan rates: front book rates above legacy book

    Business Loan Rates

    Q3.20 Total Stock Front Book

    Corporate & SME 3.2% 3.0%

    SBL 5.0% 4.8%

    Total 3.4% 3.4%

    30DOMESTIC YIELDS:

    CONTINUOUS IMPROVEMENT IN DEPOSIT RATES

    Financial Performance

  • 31NET FEE & COMMISSION INCOME RESILIENT DESPITE

    TOUGH EXTERNAL ENVIRONMENT

    (€mn) Q2.20 Q3.20 % Assets

    Loans & Cards Business 42 42 0.25%

    Funds Transfer 12 14 0.08%

    Bancassurance 10 11 0.07%

    Letters of Guarantee 8 8 0.05%

    Payments 8 8 0.05%

    Asset Management & Brokerage 8 7 0.04%

    FX Fees 4 4 0.02%

    Other 7 11 0.06%

    Gross Fee Income 99 105 0.62%

    Fee Expense (19) (24) -0.14%

    Net Fee Income 80 81 0.48%

    NFI in Q3.20 increased to €81mn, 1% qoq despite a

    significant fall in transaction volumes during lockdown. In

    9Μ.20 NFI increased by 2% yoy to €231mn

    Fees stemming from funds transfer and bancassurance

    were the key contributors of the increasing trend

    witnessed in Q3.20

    Financial Performance

    Net fee income stable qoq, absorbing external headwinds

  • 32 STAFF COSTS SOLID REDUCTION

    (€mn) 9M.19 9M.20 yoy

    Staff costs 394 319 -19%

    G&A costs 265 280 6%

    Taxes & Duties 55 58 4%

    Fees & Third Parties 52 48 -7%

    Products (cards, insurance, collections, etc.)1 15 43 >100%

    Promotion & Advertising 15 13 -14%

    Rents 6 5 -8%

    Other 123 113 -8%

    Depreciation 91 86 -5%

    Total operating costs (reported) 749 686 -8%

    Total operating costs (like-for-like)2 711 650 -9%

    9M.20 performance in line with Bank’s budget

    Staff costs declined by 19% yoy (-11% yoy adjusted for

    2019 VES), as the Bank realised the benefits of the carve-

    out of the NPE servicing platform and the 2019 voluntary

    exit scheme programme

    Cost to income in 9M.20 stood at 48% vs 52% the same

    period last year

    Efficiencies to be further increased along with ongoing

    digitalisation, as well as the implementation of the new

    transformation plan

    Costs running at -9% rate on a like-for-like basis, supporting the Bank’s efficiency ratio

    Financial Performance

    (1) 9M.2020 including the fee paid to the NPE servicer

    (2) like-for-like items are displayed in the APM section of the presentation

  • 33 GROUP NPE & NPE COVERAGE RATIO

    NPEs (€mn) Sep.20 Mix

    Business 14,909 66%

    Mortgages 5,647 25%

    Consumer 2,119 9%

    TOTAL 22,675 100%

    Group NPE ratio per product category

    Group NPE mix

    48%51%

    42%

    52%47% 48%

    42%

    51%

    Total Business Mortgages Consumer

    Jun.20

    Sep.20

    Financial Performance

    NPE coverage ratio per product

    LLRs (€mn) Sep.20LLR/

    Loans

    Business 6,889 22%

    Mortgages 1,742 13%

    Consumer 1,577 38%

    TOTAL 10,208 21%

    LLRs (€mn) Sep.20LLR/

    Loans

    Greece 9,694 20%

    International 515 44%

    TOTAL 10,208 21%

    Group LLRs at 22% over loans

    45% 46%

    31%

    75%

    45% 46%

    31%

    74%

    Total Business Mortgages Consumer

    Jun.20

    Sep.20

  • 34 CURING POTENTIAL FROM FORBORNE LOANS

    (€bn) 0 dpd 1-89dpd >90dpd Denounced NPEs

    Business 3.5 0.9 2.1 8.4 14.9

    Mortgages 0.6 0.4 0.6 4.0 5.6

    Consumer 0.1 0.1 0.5 1.4 2.1

    TOTAL 4.3 1.4 3.2 13.8 22.7

    NPEs per bucket (Sep.20)

    Forborne loans (Sep.20, €9.0bn)

    NPΕ mix 19% 6% 14% 61% 100%

    [1] [2] [3] [1+2+3+4][4]

    NPEF 0dpd38%

    NPEF 1-30dpd7%

    NPEF 31-90dpd7%

    NPEF >90dpd18%

    PF31%

    Financial Performance

    46%

    46%

    Cash coverage Collateral coverage

    74%

    23%

    Cash coverage Collateral coverage

    * pre-haircut tangible collateral (guarantees not included) capped at loan amount

    Mortgages

    Business

    Consumer

    Total 93%

    Total 101%

    Total 98%

    31%

    71%

    Cash coverage Collateral coverage

    Cash & collateral coverage

  • 35 PRE WRITE-OFF NEGATIVE FORMATION IN Q3.20

    -187

    -740

    -612

    -381

    -247

    -460

    -189-143-124

    -272-381

    -53

    56 31

    -63-9 -55 -28

    -133 -69-149 -91-61 -38

    -2 -21

    18

    -52 -29 -26 -6 -39 -18

    Q1.

    18

    Q2.

    18

    Q3.

    18

    Q4.

    18

    Q1.

    19

    Q2.

    19

    Q3.

    19

    Q4.

    19

    Q1.

    20

    Q2.

    20

    Q3.

    20

    Q1.

    18

    Q2.

    18

    Q3.

    18

    Q4.

    18

    Q1.

    19

    Q2.

    19

    Q3.

    19

    Q4.

    19

    Q1.

    20

    Q2.

    20

    Q3.

    20

    Q1.

    18

    Q2.

    18

    Q3.

    18

    Q4.

    18

    Q1.

    19

    Q2.

    19

    Q3.

    19

    Q4.

    19

    Q1.

    20

    Q2.

    20

    Q3.

    20

    Greek NPE Formation by Segment |€mn

    Business Mortgages Consumer

    NPE Greece | €mn

    NPE formation continued

    its negative pace in Q3.20

    in all segments

    Financial Performance

    24,83826,473

    -238 -215

    26,020

    -567 -211

    25,242

    -246 -176 -658

    675

    -302 -400 -405

    23,730

    -199 -150

    23,381

    -461 -333

    22,587

    -490 -160

    21,938

    Dec.18 NPE formation

    W/Oclean-up

    Mar.19 NPEformation

    W/Oclean-up

    Jun.19 NPEformation

    W/Oclean-up

    Sales (NPE

    portion)

    Technical adjustment

    Sep.19 NPEformation

    W/Oclean-up

    Sales (NPE

    portion)

    Dec.19 NPEformation

    W/Oclean-up

    Mar.20 NPEformation

    W/Oclean-up

    Jun.20 NPEformation

    W/Oclean-up

    Sep.20

    * write-offs related with clean-up actions appear in separate, whereas debt forgiveness write-offs are included in NPE formation

  • 9Μ.2020FINANCIALRESULTS

    03Appendix

  • 36 GROUP RESULTS | QUARTERLY EVOLUTION

    Appendix

    (€mn) Q3.17 Q4.17 Q1.18 Q2.18 Q3.18 Q4.18 Q1.19 Q2.19 Q3.19 Q4.19 Q1.20 Q2.20 Q3.20

    Net Interest Income 415 390 353 352 349 355 360 359 353 363 360 367 380

    Net Fee Income 112 76 69 70 124 76 69 77 81 91 71 80 81

    Net Fee Income (recurring) 77 76 69 70 76 76 69 77 81 91 71 80 81

    Trading & Other Income 24 -1 26 36 26 45 15 13 33 359 (19) 63 35

    Total Net Revenues 551 464 448 458 499 477 445 449 467 813 412 510 496

    Total Net Revenues (recurring) 516 454 448 458 451 477 445 449 467 462 412 510 496

    Staff Costs (128) (153) (259) (125) (117) (114) (120) (139) (135) (110) (107) (105) (107)

    Staff Costs (recurring) (128) (137) (130) (125) (120) (121) (120) (123) (115) (115) (107) (105) (107)

    Administrative Expenses (108) (145) (97) (113) (103) (129) (80) (92) (92) (121) (91) (91) (98)

    Depreciation & Other (24) (28) (27) (25) (26) (26) (30) (30) (30) (32) (29) (29) (28)

    Total Operating Costs (260) (325) (383) (262) (246) (269) (231) (261) (257) (264) (227) (225) (234)

    Total Operating Costs (recurring) (260) (309) (254) (262) (249) (275) (231) (245) (237) (269) (227) (225) (234)

    Pre Provision Income 291 139 64 196 253 208 214 188 210 549 185 285 262

    Pre Provision Income (recurring) 256 144 193 196 203 202 214 203 230 193 185 285 262

    Result from Associates 4 (8) (8) (16) 11 28 (10) (0) 11 5 (16) 0 (4)

    Impairment on Loans* (310) (1,189) (163) (149) (149) (137) (186) (146) (157) (221) (438) (142) (146)

    Impairment on Other Assets (7) (118) (8) 20 (4) (64) 5 (7) (11) (55) (72) (18) (30)

    Pre Tax Result (21) (1,176) (115) 51 110 34 23 34 53 279 (340) 125 82

    Tax 2 1,181 35 (29) (17) 103 (9) (16) (9) (88) 110 (41) (79)

    Net Result Attributable to SHs (18) 6 (79) 24 94 145 14 20 44 192 (230) 85 3

    Minorities (1) (2) (1) (2) (1) (7) 0 (2) 0 (2) 0 (1) 0

    Discontinued Operations Result 5 (119) (3) (310) (27) (4) 5 1 5 (2) (2) (2) (2)

    * for 2019 and onwards loan impairment includes net modification loss

  • 37 PIRAEUS CORE BANK AND PIRAEUS LEGACY UNIT KPIs | 9M.20

    Appendix

    * Legacy includes NPE, international operations, REO, holdings, discontinued operations and non-core Greek assets** Including net modification loss & associates’ income. The illustration refers to underlying impairment, excluding Covid-19 impact of €362mn

    PIRAEUS GROUP

    1,107

    231

    1,417

    (686)

    732

    (503)

    229

    2.2%

    0.5%

    48%

    1.5%

    0.5%

    64%

    LEGACY*

    290

    9

    314

    (90)

    224

    (322)

    (98)

    2.3%

    0.1%

    29%

    3.1%

  • 38 FOCUS ON CORE ACTIVITIES

    Appendix

    * Legacy includes NPE, international operations, REO, holdings, discontinued operations and non-core Greek assets** Including net modification loss & associates’ income. The illustration refers to underlying impairment, excluding Covid-19 impact of €362mnn.m.: non-meaningful

    CORE BANK

    9M.20 | €mn Retail CIB Markets Corp.Center CORE TOTAL Legacy* GROUP

    NII 349 348 104 16 817 290 1,107

    NFI 135 84 4 1 223 9 231

    Other Income 6 2 20 36 64 15 79

    Net Revenues 490 433 127 53 1,104 314 1,417

    OpEx (339) (102) (20) (134) (595) (90) (686)

    PPI 151 331 107 (81) 508 224 732

    Impairment** (55) (58) (21) (48) (181) (322) (503)

    PBT 96 273 86 (128) 327 (98) 229

    NIM over Assets 4.5% 3.2% 0.9% 0.2% 2.1% 2.3% 2.2%

    NFI over Assets 1.7% 0.8% 0.0% 0.0% 0.6% 0.1% 0.5%

    Cost to Income 69% 24% 16% n.m. 54% 29% 48%

    Cost of Risk** 0.8% 0.5% n.m. n.m. 0.6% 3.1% 1.5%

    PPI over RWA 3.6% 4.0% 6.2%

  • 39 LOAN & DEPOSIT PORTFOLIOS

    Appendix

    Gross Loans Evolution (€mn)

    Dec.17 Dec.18 Sep.19 Dec.19 Mar.20 Jun.20 Sep.20 qoq yoy

    Group 58,627 51,475 49,758 48,600 48,676 48,306 48,488 0% -3%

    Business 37,962 32,144 31,369 30,498 30,744 30,489 30,783 1% -2%

    Mortgages 15,183 14,523 14,068 13,914 13,781 13,669 13,551 -1% -4%

    Consumer 5,482 4,808 4,322 4,188 4,151 4,149 4,154 0% -4%

    Greece 56,597 50,382 48,474 47,399 47,481 47,126 47,327 0% -2%

    Business 36,317 31,215 30,235 29,413 29,664 29,423 29,733 1% -2%

    Mortgages 14,973 14,474 14,025 13,879 13,747 13,635 13,519 -1% -4%

    Consumer 5,307 4,693 4,214 4,106 4,069 4,068 4,075 0% -3%

    Int’l 2,030 1,093 1,285 1,201 1,196 1,180 1,161 -2% -10%

    Business 1,645 928 1,134 1,084 1,078 1,066 1,050 -1% -7%

    Mortgages 210 49 43 35 34 33 32 -4% -26%

    Consumer 175 116 107 82 83 81 79 -2% -27%

    Deposits Evolution (€mn)

    Dec.17 Dec.18 Sep.19 Dec.19 Mar.20 Jun.20 Sep.20 qoq yoy

    Group 42,715 44,739 45,172 47,351 46,697 45,706 47,088 3% 4%

    Savings 15,134 15,323 15,522 16,660 17,198 17,705 18,211 3% 17%

    Sight 11,682 12,013 12,513 12,656 12,648 13,402 14,492 8% 16%

    Time 15,900 17,402 17,137 18,035 16,851 14,598 14,386 -1% -16%

    Greece 40,889 44,536 44,916 47,099 46,452 45,504 46,882 3% 4%

    Savings 14,825 15,309 15,508 16,647 17,185 17,693 18,199 3% 17%

    Sight 11,125 11,927 12,376 12,567 12,564 13,311 14,397 8% 16%

    Time 14,938 17,300 17,032 17,885 16,703 14,499 14,285 -1% -16%

    Int’l 1,826 203 255 251 245 202 206 2% -19%

    Savings 309 14 14 13 13 12 11 -6% -20%

    Sight 556 86 136 89 83 91 94 3% -31%

    Time 961 102 105 150 149 99 101 2% -4%

    Notes: loan balances exclude seasonal agri-loan of €1.6bn for Dec.17 & Dec.18 and €1.5bn for Dec.19

  • 40 IFRS9 STAGE ANALYSIS | GROUP

    Appendix

    Gross Loans (€bn)

    Dec.171 Mar.18 Jun.18 Sep.18 Dec.181 Mar.19 Jun.19 Sep.19 Dec.191 Mar.20 Jun.20 Sep.20 Δ yoy

    Stage 1 19.1 18.9 18.6 18.4 17.6 18.2 18.2 18.2 18.4 18.5 18.6 20.1 11%

    Stage 2 6.9 7.0 5.9 5.9 5.9 5.9 5.8 5.2 5.0 5.4 5.7 5.0 -4%

    Stage 3 32.3 31.8 29.3 28.5 28.0 27.5 26.7 26.3 25.2 24.8 24.0 23.3 -11%

    Total 58.3 57.7 53.7 52.8 51.5 51.6 50.8 49.8 48.6 48.7 48.3 48.5 -3%

    Coverage (%) Sep.20 Mortgages Consumer Business Total

    Stage 1 0% 2% 1% 1%

    Stage 2 1% 11% 7% 5%

    Stage 3 29% 67% 44% 42%

    Total 13% 38% 22% 21%

    (1) excluding seasonal agri-loan of €1.6bn for Dec.17 & Dec.18 and of €1.5bn for Dec.19Loans for all periods exclude balances accounted for at FVT P&L

  • GLOSSARY

    GLOSSARY | DEFINITIONS OF ALTERNATIVE PERFORMANCE MEASURES41

    1 Adjusted total assetsTotal assets excluding assets amounting to: 1) €1.2bn as at 31 March 2019 of discontinued operations in Bulgaria and other discontinued operations 2) €1.7bn as at 31 December 2019 of discontinued operations and seasonal OPEKEPE agri-loan 3) €0.1bn of discontinued operations as at 30 June 2019, 30 September 2019, 31 March 2020 , 30 June 2020 and 30 September 2020

    2 Core Banking Income or NII+NFI Net interest income plus (+) net fee and commission income

    3 Cost of Risk (CoR)ECL impairment losses on loans and advances to customers at amortised cost of the period annualised over (/) Net Loans, with the exception of the Covid-19 impact element that is not annualised in the ratio

    4 Cost of Risk UnderlyingCost of risk minus (-) ECL impairment losses due to Covid-19, as per item #6, minus (-) ECL impairments losses corresponding to NPE sales, minus (-) success fee paid to NPE servicer over (/) Net loans

    5 Cost to Income Ratio (C:I)Total operating expenses before provisions over (/) total net income excluding one-off items related to the corresponding period as per item #28

    6 Covid-19 impactCovid-19 impact of €324mn for Q1.2020, €17mn for Q2.2020 and €21mn for Q3.2020 referring to incremental ECL impairment losses on loans and advances to customers and on other assets, to reflect worsening economic outlook as a result of Covid-19

    7 Cumulative provisions (LLRs) over gross loans Cumulative provisions over (/) Gross Loans

    8 Cumulative provisions (Loan loss reserves - LLR) Accumulated ECL allowance on loans and advances to customers at amortised cost

    9 Deposits or Customer Deposits Due to customers

    10 Private Sector Deposits Deposits minus (-) Greek Ministry of Finance deposits with the Bank

    11 DTAs Deferred Tax Assets

    12 Gross Book Value (GBV) Gross loans

    13 Gross Loans Loans and advances to customers at amortised cost before ECL allowance

    14 Liquidity Coverage Ratio (LCR) Liquidity coverage ratio is the amount of sufficient liquidity buffer for a bank to survive a significant stress scenario lasting one month

    15Loan impairment charges (Provision Expenses)/impairments

    ECL impairment losses on loans and advances to customers at amortised cost

    16 Loans to Deposits Ratio (LDR) Net loans over (/) Deposits

    17 Net Fee Income (NFI or NFCI) Net Fee and Commission Income

    18 Net Interest Margin (NIM) Net interest income annualised over (/) Adjusted total assets

    19 Net Loans Loans and advances to customers at amortised cost

    20 Net Results or Net Profit Profit / (loss) for the period attributable to shareholders of the Bank

    21 Net Stable Funding RatioThe portion of liabilities and capital expected to remain with the Bank for more than one year over (/) The amount of stable funding that the Bank is required to hold given the liquidity characteristics and residual maturities of its assets and the contingent liquidity risk arising from its off-balance sheet exposures

    22 Net Revenue(s) Total Net Income

    23 New Loan Generation New loan disbursements that were realised after previous end period

  • GLOSSARY

    GLOSSARY | DEFINITIONS OF ALTERNATIVE PERFORMANCE MEASURES (cont’d)42

    24 NFI over Assets Net fee and commission income annualised over (/) Adjusted total assets

    25 NII Net Interest Income

    26 Non Performing Exposures (NPEs)

    On balance sheet credit exposures before ECL allowance for impairment on loans and advances to customers at amortised cost that are: (a) past due over 90 days; (b) impaired or those which the debtor is deemed as unlikely to pay (“UTP”) its obligations in full without liquidating collateral, regardless of the existence of any past due amount or the number of past due days; (c) forborne and still within the probation period under EBA rules; (d) subject to contagion under EBA rules or other unlikely to pay (UTP) criteria

    27 Bank Non Performing Exposures (NPEs) Non Performing Exposures of the parent entity excluding intragroup lending NPEs

    28 Non-Recurring (One-off) ItemsNon Recurring Items for FY.19 include €351mn capital gain from the NPE servicing platform carve-out (included in trading Income), €36mn related with VES costs (out of which €20 mn in Q3.2019) and €5mn other offsetting cost adjustments (both reported in OpEx).

    29 NPE (Cash) Coverage Ratio Accumulated ECL allowance over (/) NPEs

    30 NPE Formation Change of the stock of NPEs after adding back write-downs or other adjustments i.e. loan sales or debt to equity transactions

    31 NPE Ratio Non Performing Exposures over (/) Gross Loans

    32 Operating Costs - Expenses (OpEx) Total operating expenses before provisions

    33 OpEx/Assets Total operating expenses over (/) Adjusted total assets

    34 OpEx (like for like) Operating costs, minus (-) non-recurring VES costs in Q2.2019 and Q3.2019, minus (-) the cost of the assets under management fee paid to the NPE servicer

    35 Performing Exposures (PE) Gross Loans minus (-) Non Performing Exposures

    36 Pre Provision Income (PPI) Profit before provisions, impairments and income tax

    37 PPI, like for likePPI minus (-) non-recurring VES costs in Q2.2019 and Q3.2019, minus (-) assets under management fee paid to the NPE servicer in 9Μ.2020

    38 PPI / RWA Pre Provision Income over (/) Risk Weighted Assets

    39 Pre Tax Results/Pre Tax profits (PBT) Profit / (loss) before income tax

    40 Recurring Operating expenses (Recurring OpEx) Operating Expenses excluding "Non Recurring (One-off) Items“ as per item #28

    41 Recurring Pre Provision Income (Recurring PPI) PPI excluding one-off items related to the corresponding period as per item #28

    42 Recurring Pre Tax Result Pre Tax Results excluding one-off items related to the corresponding period as per item #28 and Covid -19 impact as per item # 6

    43 Recurring Total Net Revenues Total net income minus (-) one-off income related to the corresponding period as per item #28

    44 Return on Assets (RoA) Profit before income tax for the period annualised over (/) Adjusted total assets

    45 RWA density Risk Weighted Assets over (/) Adjusted total Assets

    46 Tangible book value Total equity minus the nominal value of cocos minus intangible assets

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    The accompanying presentation has been prepared by Piraeus Bank S.A. and its subsidiaries and affiliates (the “Bank” or “We”) solely for informational purposes. For the purposes of this disclaimer, the presentation that followsshall mean and include materials, including and together with any oral commentary or presentation and any question-and-answer session. By attending a meeting at which the presentation is made, or otherwise viewing oraccessing the presentation, whether live or recorded, you will be deemed to have agreed to the following restrictions and acknowledged that you understand the legal and regulatory sanctions attached to the misuse, disclosure orimproper circulation of the presentation or any information contained herein.

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    The Bank has included certain non-IFRS financial measures in this presentation. These measurements may not be comparable to those of other companies. Reference to these non-IFRS financial measures should be considered inaddition to IFRS financial measures, but should not be considered a substitute for results that are presented in accordance with IFRS.

    Certain statements contained in this presentation that are not statements of historical fact, including, without limitation, any statements preceded by, followed by or including the words “targets,” “believes,” “expects,” “aims,”“intends,” “may,” “anticipates,” “would,” “could” or similar expressions or the negative thereof, constitute forward-looking statements, notwithstanding that such statements are not specifically identified. Examples of forward-looking statements include, but are not limited to, statements which are not statements of historical fact and may include, among other things, statements relating to the Bank’s strategies, plans, objectives, initiatives and targets,its businesses, outlook, political, economic or other conditions in Greece or elsewhere, the Bank’s financial condition, results of operations, liquidity, capital resources and capital expenditures and development of markets andanticipated cost savings and synergies, as well as the intention and beliefs of the Bank and/or its management or directors concerning the foregoing. Forward-looking statements are not guarantees of future performance andinvolve certain risks, uncertainties and assumptions which are difficult to predict and outside of the control of the Bank. Therefore, actual outcomes and results may differ materially from what is expressed in such forward-lookingstatements. We have based these assumptions on information currently available to us, and if any one or more of these assumptions turn out to be incorrect, actual market results may differ significantly. While we do not knowwhat impact any such differences may have on our business, if there are such differences, our future results of operations and financial condition, could be materially adversely affected. You should not place undue reliance onthese forward-looking statements. Forward-looking statements speak only as of the date on which such statements are made. The Bank expressly disclaims any obligation or undertaking to disseminate any updates or revisions toany forward-looking statement to reflect events or circumstances after the date on which such statement is made, or to reflect the occurrence of unanticipated events.

    9Μ.2020FINANCIALRESULTS

  • Investor Relations ContactsChryssanthi Berbati Antonis Sagris Xenofon Damalas, CFA George Doukas Amalia Missailidi

    4 Amerikis St., 105 64 AthensTel. : (+30 ) 210 [email protected]

    Bloomberg: TPEIR GA | Reuters: BOPr.AT ISIN: GRS014003024 www.piraeusbankgroup.com

    9Μ.2020FINANCIALRESULTS

    mailto:[email protected]://www.piraeusbankgroup.com/

  • PIRAEUS BANK GROUP HEADQUARTERS

    4, Amerikis Str., 105 64 Athens, GreeceT. +30 210 333 5026 www.piraeusbankgroup.com