Jefferies has reaffirmed its positive outlook on Greece’s two largest banks, the National Bank of Greece (NBG) and Eurobank, ahead of their upcoming third-quarter 2025 financial results.

The investment firm raised its price target for NBG to €15.50 from €13.55 and for Eurobank to €4.15 from €3.70, maintaining a “Buy” recommendation on both lenders.

Jefferies said the two banks are entering the final quarter of 2025 with strong momentum, underpinned by robust capital adequacy, predictable profitability, and improved funding conditions.

The firm added that lower financing costs are enhancing shareholder return potential, as both institutions continue to demonstrate resilience and operational strength.

Eurobank is scheduled to announce its third-quarter results on October 30, 2025, while NBG will follow on November 6, 2025.

Jefferies expects these announcements to confirm “the continued resilience of the Greek banking system.”

For Eurobank, Jefferies anticipates another solid quarter, with a return on tangible book value (RoTBV) of 15.3 per cent, despite mild pressure from lower interest rates.

Net interest income is expected to edge slightly lower as lending yields decline following an approximately 10-basis-point drop in Euribor, though this is partially offset by new loan expansion of around €0.9 billion.

The report stated that fee income will moderate compared with the exceptionally strong second quarter, due to normalised contributions from CNP, though the positive trend in lending and wealth management fees remains intact.

Operating expenses are forecast to rise by 2 per cent quarter-on-quarter, in line with annual guidance, while the cost of risk (CoR) is projected to remain steady at 60 basis points.

The CET1 ratio is expected to stay at 15.3 per cent, with organic profitability gains of 60 basis points offset by an increase in risk-weighted assets (RWA) stemming from loan growth and deferred tax credit adjustments.

Jefferies also foresees a €25 million extraordinary charge from Eurobank’s participation in the school infrastructure programme, alongside a €15 million accounting gain from the CNP acquisition, similar to the previous quarter.

The firm has lifted its net profit forecasts for 2026–2027 by 2 per cent, incorporating a higher ECB deposit rate of 2 per cent instead of 1.75 per cent and a lower cost of capital.

The new €4.15 price target implies a 23 per cent upside potential and supports Jefferies’ continued “Buy” rating.

For NBG, Jefferies expects steady profitability and a strong capital base to remain key investment drivers.

The bank’s net interest income is seen declining slightly, owing to a slower repricing of loan rates and more moderate credit expansion during the quarter.

However, this is balanced by stronger fee income from investment and asset management products, where NBG continues to gain market share.

Lower deposit costs, as time deposits are repriced downward, are also expected to support net revenues.

Loan activity is projected to pick up in the fourth quarter, keeping NBG on track to achieve its annual net credit expansion target above €2.5 billion.

Operating costs are anticipated to increase marginally by 4 per cent year-on-year, reaching €227 million, leading to a cost-to-income ratio of 35 per cent.

Loan loss provisions are expected to remain stable at a CoR of 0.40 per cent.

Jefferies estimates that NBG’s CET1 ratio will rise to 19.0 per cent, well above its 14 per cent internal target, reinforcing its position as Greece’s best-capitalised bank.

The firm also said that NBG combines a high return on tangible equity (ROTE) of 19 per cent with a low non-performing exposure (NPE) ratio of 2.5 per cent, making it “the highest-quality play in the Greek banking sector.”