Fitch Ratings has upgraded National Bank of Greece S.A.'s (NBG) Long-Term Issuer Default Rating (IDR) to 'BB-' from 'B+' and Viability Rating (VR) to 'bb-' from 'b+'. The Outlook on the Long-Term IDR is Stable. The upgrade reflects NBG's structural improvements in profitability as a result of its de-risking and restructuring, which is also supported by rising interest rates and economic growth in Greece.
Buffers over regulatory capital requirements have increased and we expect internal capital generation to continue to grow. The upgrade also reflects the improved funding and liquidity profile following consistent deposit growth and recent debt issuances. The resilience of the Greek economy in 2023, even in light of prevailing uncertainty further underpin the upgrade.
The rating agency has also upgraded Piraeus Bank S.A.'s Long-Term Issuer Default Rating (IDR) to 'B' from 'B-' and Viability Rating (VR) to 'b' from 'b-'. The Outlook on the Long-Term IDR is Positive.
The upgrade reflects Piraeus's continued progress in reducing its stock of non-performing exposures (NPEs) and strengthening its regulatory capital ratios through structurally improving profitability and capital management actions. This has led to improved buffers over regulatory requirements and a material reduction in capital encumbrance by unreserved problem assets (which include NPEs and unreserved foreclosed assets).
For Alpha Bank S.A.'s (Alpha) and Alpha Services and Holdings S.A.'s (HoldCo) Long-Term Issuer Default Ratings (IDR) has been upgraded to 'B+' from 'B' and Viability Ratings (VR) to 'b+' from 'b'. The Outlook on the Long-Term IDRs is Stable. A full list of rating actions is below.
The upgrade reflects Alpha's stronger capitalisation as a result of structurally improved profitability, expected capital accumulation, and reduced capital encumbrance by unreserved problem assets. This is the result of Alpha's progress in reducing its legacy non-performing exposures (NPE) through disposals and organically. The resilience of the Greek economy in 2023, even in light of prevailing uncertainty further underpin the upgrade.
Eurobank S.A.'s and Eurobank Ergasias Services and Holdings S.A. (HoldCo) Long-Term Issuer Default Ratings (IDR) was upgraded to 'BB-' from 'B+', and Viability Ratings (VR) to 'bb-' from 'b+'. The Outlook on the Long-Term IDRs is Stable.
The upgrades reflect the structural improvements to Eurobank's profitability as a result of its successful de-risking and restructuring, supported by rising interest rates and economic growth in Greece. Buffers over regulatory capital requirement have strengthened and we expect internal capital generation to continue supporting metrics.
