Psaltis to Investors: “Alpha Bank’s Hidden Strength Is Only Now Emerging”

Alpha Bank CEO Vassilis Psaltis delivered a clear message to investors during the bank’s earnings call: the real investment story lies in stronger-than-expected core profitability, accelerating loan growth, and an increasingly diversified fee-income base. While the CET1 capital ratio remains the market’s main concern, management believes the bank’s organic capital generation will ultimately support both growth and higher shareholder returns.

The real Alpha story goes beyond interest rates

Alpha Bank used its latest earnings presentation to shift investors’ attention away from one-off charges and legacy issues, emphasizing instead the strength of its underlying business model.

CEO Vassilis Psaltis argued that Alpha’s competitive advantage now rests on four pillars:

• accelerating organic earnings,
• stronger loan expansion,
• higher recurring fee income,
• strategic partnerships that reshape the bank’s long-term growth profile.

Management upgrades guidance

The bank raised its outlook, reflecting stronger operating momentum:

• EPS guidance increased to €0.41
• Normalized earnings expected to grow 13% in 2026
• Reported net profit target maintained at €950 million

Management stressed that stronger operating performance is expected to absorb the impact of legacy cash-flow hedge costs, mortgage-related legal provisions, and extraordinary government levies without changing the bank’s long-term trajectory.

Loan growth is outperforming expectations

One of the strongest messages from the conference call concerned credit expansion.

Alpha Bank has already achieved close to 90% of its full-year net loan growth target, while:

• performing loans increased 5% quarter-on-quarter,
• net loan expansion reached €1.6 billion,
• total performing loans are approaching €40 billion.

Management also highlighted that growth is no longer driven primarily by Recovery Fund lending, indicating broader demand from the real economy.

Fee income is becoming the new growth engine

Alpha Bank is increasingly diversifying revenue sources beyond traditional lending.

Fee income is now supported by:

• investment banking,
• transaction banking,
• payment services,
• card business,
• trade finance,
• cash management,
• capital markets,
• wealth management.

Management’s strategy is straightforward: deepen relationships with corporate clients by offering a full spectrum of financial services rather than relying solely on loan origination.

The acquisitions and partnerships announced over the past year are now starting to translate into financial results.

The Axia platform participated in transactions worth more than €10 billion during the first half of the year, while the strategic alliance with UniCredit is expanding opportunities across:

• cross-border corporate financing,
• trade finance,
• treasury products,
• investment services,
• wealth management.

These initiatives are expected to increase recurring revenues while strengthening Alpha Bank’s position as a regional financial services platform.

CET1 remains the market’s key concern

The principal issue raised by analysts during the Q&A session was capital.

Alpha Bank’s CET1 ratio declined to 14.3%, reflecting:

• rapid loan growth,
• acquisitions,
• shareholder distributions,
• real estate investments,
• higher risk-weighted assets.

Management argued that the decline includes several temporary factors and emphasized that organic capital generation remains healthy, supported by future synthetic securitizations and the gradual conversion of deferred tax assets into regulatory capital.

Vassilis Psaltis sought to reassure investors that Alpha Bank has entered a new phase of sustainable growth. Stronger earnings guidance, robust loan expansion, rising fee income, and the strategic contribution of Axia and UniCredit strengthen the bank’s long-term investment case. The only meaningful constraint remains capital generation, with the CET1 ratio becoming the market’s primary valuation metric.

If management succeeds in demonstrating over the coming quarters that organic capital creation can comfortably finance business expansion, acquisitions, and rising shareholder distributions, Alpha Bank could be well positioned for a further market re-rating. For investors, the upcoming Investor Day in November is expected to be the next major catalyst, providing measurable targets for capital efficiency, fee growth, cross-selling opportunities, and long-term shareholder returns.

Source: pagenews.gr