Eurobank raises net interest income growth forecast to 9% after adjusted profit of 1.209 billion euros
Key Facts
Eurobank raised its forecast for 2026 net interest income growth to about 9% year on year, compared with a forecast of close to 7% announced in July, the CFO said on the third-quarter results call. The revision came as the bank reported adjusted net profit of 1.209 billion euros for the first nine months, up 14.3% from the same period. Reported net profit rose 12.4% to 1.161 billion euros, a measure separate from adjusted profit. The results show growth in interest and fee income, alongside continued expansion in lending and deposits. The CFO said the new full-year estimate reflects the trajectory shown by the bank’s results through the third quarter.
Net interest income rose 8.7% year on year to 2.068 billion euros in the first nine months. In the third quarter alone, income increased 5% from the previous quarter to 719 million euros. The bank attributed the quarterly increase to growth in interest-earning assets and an increase in the average European Central Bank deposit facility rate to 229 basis points, from 204 basis points in the second quarter. On the results call, the CFO said deposit spreads improved 46 basis points and the net interest margin reached 253 basis points in the third quarter, rising for a third consecutive quarter. The combination of asset growth and improved deposit spreads points to multiple sources of support for interest income during the period.
But stronger interest income coincided with pressure on lending spreads, particularly in the corporate portfolio. The CFO said competition explained most of the pressure and that corporate spreads had contracted 16 to 17 basis points through the third quarter. He added that the bank expects an annual contraction of about 20 basis points in corporate spreads during 2026. This pressure offsets growth in interest income and improved deposit spreads, putting competition for loans among the factors management is monitoring. The previous forecast for net interest income growth was close to 7%, before it was raised to about 9% in light of performance so far this year.
Alongside interest income, net fee and commission income rose 13% year on year to 630 million euros in the first nine months. The bank said the increase came mainly from higher fees in lending, wealth management and insurance activities. Organic loan growth was 3.8 billion euros, or 10.5% year on year, while customer deposits increased by 4.7 billion euros, or 10.6% since the start of the year. These figures reflect broader activity on both the funding and lending sides, with fee-generating businesses contributing to revenue growth. Operations outside Greece accounted for almost half of adjusted net profit, while Greece recorded 654 million euros, Cyprus 356 million and Bulgaria 182 million in adjusted profit.
Operating income rose 10.8% year on year to 2.776 billion euros, while operating expenses increased at a slower pace, up 6.9% to 995 million euros. The difference between income and expense growth was reflected in the cost-to-income ratio, which improved to 35.8% from 37.1% in the first nine months of the previous year. Loan-loss provisions fell 5.5% to 224 million euros, while the non-performing loan ratio stood at 2.4% on September 30, 2026. These indicators provide additional context for profit growth, combining higher revenue with improved operating efficiency and lower provisions. Expansion was not limited to net interest income, but also included fees and commissions and lending activity.
The bank announced an interim dividend of 5.99 euro cents per share, up 27% from the previous year, with a total value of 214 million euros. It said payment is scheduled for November 26, 2026, subject to the necessary approvals. The CFO also said the bank will update the market at the end of February on its new business plan for 2027 to 2029. The two dates put the dividend and business plan among the next milestones following the nine-month results. The bank is scheduled to present its new plan at the end of February, according to the results call.