With all IFRS reports published (finally), we present our sector map for Q4/FY 2023. Our views per bank have already been analyzed in stand-alone notes. In short: if you wish to bet on P/TBV moving towards 1.0x TBV, go with NBG. If you prefer to bet on P/TBV convergence, go with Alpha. To avoid being solely backward-looking, we present an exercise showing the single most important parameter in banks’ 2026 RoTE guidance.

Piraeus just announced FY 2023 results and detailed 2024-2026 business plan targets. Given the HFSF’s stated plan to exit its 27% stake in the bank, we analyze 2024-2026 guidance, to help readers decide what to do with the stock.

Q4 Sector Map confirms NBG as our top pick. Highest NII, NIM, PPPM; RoTE; CET1; S3 covg combined with lowest NPE%, CoR; ECB funding. Additionally, it recorded the biggest increase in S1 loans qoq / decrease in S2+3 loans. The bank benefits from a low time-deposit mix at 18% (vs 24%-34% peers), therefore enjoying a lower deposit beta (10% vs 12%-15% in Q3); We estimate NBG’s RoTE excludes c. E17m (or 100bps RoTE annualized) in opex (one-offs) which does not change the comparison.

What’s new? Piraeus announced very strong Q2 numbers, driven (once again) by higher interest rates (NIM +15bps qoq), specifically the higher pass-through on loans (75%) combined with a lower pass through on deposits (18%). With the latter reflecting the -still- low weight of term deposits (23% from 18% in Q4 2022) despite the 1.0%-1.5% offered since Q1.
Management raised 2023 RoTE guidance to 14% (from 12% three months ago and 10% six months ago) on a combination of stronger NII and fees, plus lower CoR; The 12% RoTE guidance for 2025 was left unchanged, while interim guidance was introduced for 2024 at 14%.

’If you cannot explain it simply, then you do not understand it well enough.’’ Testing ourselves, we share our understanding of each Greek investment case we cover within a few lines.
Conclusions: Our base case scenario is materializing, i.e., Mitsotakis administration renewing its mandate and Greece avoiding a recession. Equities have re-rated and are +36% YTD, so now…