JP Morgan characterizes the Q2 2026 results of Greek banks as strong, highlighting dynamic loan growth, resilience in net interest income and fee revenues, as well as management target upgrades, but estimates that the positive outlook appears to be largely already priced into the equities.
The US bank maintains an Overweight stance on Eurobank, Alpha Bank, and National Bank of Greece, estimating that strong credit expansion, revenue improvement, and new strategic agreements create scope for further upgrades to estimates.
The target prices mentioned in JP Morgan's analyses are as follows:
1) Eurobank Target price Dec. 2027: €4.40
Rating: Overweight
2) Alpha Bank Target price Dec. 2027: €4.40
Rating: Overweight
3) National Bank of Greece Target price Dec. 2027: €16.00
Rating: Overweight
Eurobank: €425 million profits and strong target upgrades
Eurobank reported adjusted net profits of 425 million euros in the second quarter of 2026, 11% higher than market estimates and 9% higher than JP Morgan's forecasts.
The quarterly return on tangible equity (ROTE) reached 18%.
According to JP Morgan, the beat on estimates came mainly from higher trading income, which reached 37 million euros compared to a forecast of 18 million euros, but also from lower operating costs, reduced provisions, and a lower tax burden.
Loan dynamics were particularly strong, with gross loans increasing by 2% quarter on quarter and by 8% year on year. Deposits strengthened by 5% in the quarter and by 11% year on year, creating additional support for net interest income in the second half of the year and 2027.
Net interest income (NII) increased by 3% quarter on quarter and stood at 685 million euros, while the net interest margin (NIM) strengthened to 248 basis points. Fee income increased by 4% quarter on quarter and by 8% year on year, while the completion of the agreement with Eurolife is expected to offer an additional boost.
The management of Eurobank upgraded its forecasts for 2026, now expecting an increase in net interest income of about 7%, compared to a previous estimate for a rise of 2.5%. At the same time, it raised the forecast for organic fee growth to about 10%, from 7% previously, while predicting core operating profit of about 2 billion euros compared to a previous target of 1.9 billion euros.
JP Morgan estimates that the market has already largely incorporated the new guidance, however it sees scope for further upgrades in net interest income estimates due to strong volume dynamics.
The stock of Eurobank has strengthened by 29% since the beginning of the year and trades at a P/E ratio of 9.6 times for 2027 and P/TBV 1.5 times. JP Morgan maintains an Overweight rating.
Alpha Bank: Strong operational picture and Investor Day as catalyst
Alpha Bank reported adjusted net profits of 275 million euros in the second quarter of 2026, 17% higher than market estimates.
JP Morgan highlights the significant improvement in the bank's core figures, with net interest income increasing by 5% quarter on quarter to 436 million euros and the interest margin strengthening by 4 basis points to 2.16%.
Gross loans increased by 4% in the quarter and by 12% year on year, while deposits strengthened by 6% quarter on quarter and by 14% year on year.
Fee income stood at 187 million euros, up 34% quarter on quarter and 38% year on year.
However, performance was boosted by a dividend of 40 million euros from Prodea.
Excluding this effect, fees increased by 5% in the quarter and by 9% year on year, thanks to the performance of investment banking, brokerage services, and cards.
Operating expenses stood at 240 million euros, while the cost to income ratio remained at 38%. Cost of risk fell to 39 basis points, with the non performing exposure ratio (NPE) standing at 3.6%.
The CET1 capital adequacy ratio reached 14.3%, after the impact of the acquisition of Alpha Trust.
Alpha Bank increased its earnings per share target for 2026 to 0.41 euros from 0.40 euros previously, while announcing an interim dividend of 124 million euros, which will be paid in the fourth quarter.
JP Morgan considers the Investor Day in November 2026 a key catalyst, where management is expected to present its long term strategy and new targets.
The stock has strengthened by 19% since the beginning of the year, compared to a 30% rise in the banking index, and trades at a P/E of 9.2 times and P/TBV 1.1 times. The rating remains Overweight.
National Bank of Greece: Strong quarter, Dromeus and Allianz bolster outlook
National Bank of Greece reported adjusted net profits of 317 million euros in the second quarter of 2026, 2% higher than market estimates.
Return on tangible equity (ROTE) stood at 15.6%, up 30 basis points compared to the previous quarter.
Net interest income reached 555 million euros, up 3% quarter on quarter and 4% year on year, while the interest margin strengthened to 273 basis points.
Credit expansion remained strong, with gross loans increasing by 3% in the quarter and deposits by 5%. Fee income stood at 129 million euros, up 14% quarter on quarter and 12% year on year.
Asset quality remained top tier, with the NPE ratio at 2.4% and coverage at 105%. The CET1 ratio stood at 17.3%.
JP Morgan places particular emphasis on National Bank of Greece's strategic agreement with Dromeus Capital Group for investment in a commercial real estate portfolio of 400 million euros.
The agreement is expected to boost fee income, with management estimating an increase of 3 percentage points annually in the period 2027-2028, a rise in earnings per share of over 1%, and a ROTE boost of more than 20 basis points.
Combined with the bancassurance deal with Allianz, JP Morgan estimates that the two moves can add about 80 million euros to 2027 profits and 100 million euros in 2028.
Management of National Bank of Greece upgraded its forecasts for 2026, now expecting net interest income growth in the mid single digit range, an interest margin of about 280 basis points, earnings per share over 1.40 euros, ROTE over 15%, and a cost to income ratio of about 36%.
The stock of National Bank of Greece has strengthened by 26% since the beginning of the year and trades at a P/E of 10.7 times for 2027 and P/TBV 1.4 times.
JP Morgan maintains an Overweight rating, estimating that Greek banks are in a phase of strong growth, driven by credit expansion, improving profitability, and strategic partnerships that strengthen long term prospects.
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