Piraeus Bank Charts Ambitious Course for Growth Through 2028

21:43 15/4/2025 - Πηγή: Dikaiologitika

Over the next four years, Piraeus plans to deliver solid financial performance and return more than €2 billion to shareholders by 2028.

Piraeus Bank is setting its sights on a new era of long-term growth, digital innovation, and shareholder returns, according to CEO Christos Megalou, who addressed

shareholders at the bank’s Annual General Meeting on Monday. He emphasized that the bank's strong performance in recent years was the result of dedicated work by the management team, laying a solid foundation for the future. With that foundation in place, the bank now aims to raise the bar even higher to maximize value for both shareholders and clients.

Building on a strong start in 2024, Megalou said the bank is focused on becoming the leading financial services group in Greece through a strategy of consistent, sustainable growth. Over the next four years, Piraeus plans to deliver solid financial performance and return more than €2 billion to shareholders by 2028. Profitability remains at the core of the strategy, with a target of sustainable annual earnings of €1.1 billion through 2027, rising to approximately €1.3 billion by 2028. Throughout this period, the bank aims to maintain a strong cost discipline, with a cost-to-income ratio held steady at around 35 percent.

Piraeus Bank’s strategy also includes significant investments in its people, technology, and operations. A key initiative is the launch of Snappi, a new digital banking platform designed to drive innovation and expand the bank’s footprint both in Greece and abroad. The bank will continue to focus on digital transformation, artificial intelligence, and cybersecurity, with an estimated €150 million in capital expenditures annually dedicated to technology.

The bank also aims to significantly expand its customer base and product offering. Its financial targets include annual loan growth of approximately 8 percent and a more than €1 billion increase in retail lending over the four-year period. Assets under management are expected to grow by around 8 percent each year, supported by the introduction of new products and a more client-centric approach.
In a move that marks a significant expansion of its business model, Piraeus Bank announced on March 12, 2025, the acquisition of a 90 percent stake in the parent company of Ethniki Asfalistiki, Greece’s leading insurance company, from CVC Capital Partners.

The deal, valued at €600 million in cash on a 100 percent basis, is expected to diversify Piraeus Bank’s revenue streams, enhance its range of integrated banking, insurance, and investment services, and boost value creation for shareholders. According to Megalou, the acquisition will immediately increase earnings per share by around 5 percent and improve the bank’s return on tangible equity by roughly one percentage point. The transaction will also help bring the bank’s fee generation capabilities in line with global standards, while maintaining strong cost efficiency.

The bank expects its pro forma capital position to reach approximately 18.5 percent in 2025, increasing to 19.5 percent by 2027 and around 20 percent by 2028, assuming a 50 percent dividend payout ratio from 2025 profits onwards. Piraeus Bank is also preparing to apply for classification as a Financial Conglomerate under Article 49 of the European Capital Requirements Regulation. This move, which would allow the bank to apply the so-called "Danish Compromise" in the supervisory treatment of its insurance holdings, could further strengthen its Common Equity Tier 1 (CET1) ratio by an additional 50 basis points.

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