National Bank of Greece (NBG) Memo Name: James Zhang Phone #: (757) 788-9962 College/School: CLAS Year: Class of 2017
National Bank of Greece (NBG) Memo Name: James Zhang Phone #: (757) 788-9962 College/School: CLAS Year: Class of 2017 Company Description [NYSE; NGB] is a Greek bank and financial services company that primarily operates in commercial banking, but also has business in retail banking, investment banking, asset management, and insurance. The National Bank of Greece SA previously wrote off huge losses on its balance sheet during the Eurozone debt crisis, it has been on a steady path to recovery since the second half of 2013, and has been expanding its business in various sectors throughout Europe. Specifically, the rise in Greek lending and home loans, diversification by way of improved operations in Turkey and emerging markets, and the general recovery of the Greek economy will propel NGB to huge growth in the long term. Most notably, recent actions by Mario Draghi and the European Central Bank will create a healthy, stable environment for the National Bank of Greece to achieve its upside potential over time. Thesis / Key Points Rise in lending and specific developments in the banking sector in Greece will play to NBG’s advantage As Greece’s largest lender, NBG has acted swiftly in the past year to boost its position financially by increasing loans and retailing banking, as well as increasing capitalization from outside investors and generating domestic confidence. o Its nonperforming loans (NLP) have receded drastically and will contribute to its profitability when compared with its 3 closest rivals, Piraeus Bank, Alpha Bank, and EuroBank, who have all booked operating losses in this field. In addition, NGB now controls a quarter of commercial banking in Greece and 25% of total consumer deposits, and has also proceeded to raise around €2.5 billion in capital to reduce the Greece government’s holding stake in the bank.
[Show full text]