Erste Group Bank (EBS) H1 2024 earnings summary

Executive summary

• Net profit for H1 2024 reached EUR 1,629 million, up 9.4% year-over-year, driven by strong operating results, robust top-line growth, and improved other operating result.

• Upgraded 2024 financial outlook, expecting improved NII, fee growth, lower risk costs, and higher return on tangible equity.

• Strategic focus on responsible growth, digital platform expansion, and value creation for shareholders, including share buybacks and dividends.

• Continued commitment to operating efficiency, fee income expansion, and disciplined M&A.

Financial highlights

• Net profit for H1 2024 increased 9.4% year-on-year to EUR 1,629 million, with EPS at EUR 3.73 and ROTE at 17.2%.

• Net interest income up 3.5% to EUR 3,687 million; net fee income up 12.5% to EUR 1,423 million.

• Cost/income ratio improved to 46.1% in H1 and 46.3% in Q2 2024, below 50% guidance.

• Loan-to-deposit ratio stable at 87.9%; NPL ratio at 2.4% with coverage around 80%.

• Assets under management reached an all-time high of EUR 82.2 billion.

Outlook and guidance

• 2024 guidance upgraded: NII now expected flat year-on-year (from -3%), fee income growth ~10% (from 5%), CIR <50%, risk costs <20bps, ROTE >15%.

• Loan growth guidance confirmed at ~5% for 2024, with acceleration expected in H2.

• Dividend payout planned at EUR 3 per share for 2024, subject to AGM approval; payout ratio 40-50%.

• CET1 ratio target >14.0% reaffirmed; CET1 at 15.5% after share buyback and dividend accrual.