PIRAEUS FINANCIAL HOLDINGS S.A. 
(MT Newswires) -- Christos Megalou, CEO of Piraeus Financial, sees the sale of the state's stake as a sign of confidence and a success for the bank. He explains that the bank's turnaround is the result of a seven-year journey and an elaborate strategy that addressed key issues and achieved innovative transactions, including the sale of the first package of non-performing exposures in the Greek market, the sale of the management unit of these exposures, as well as debt and equity issues. In 2021, the bank raised capital and managed to reduce its non-performing exposures from 54% to around 3%.
Megalou is targeting an annual profit of €1 billion by 2026, based on a very detailed business plan for the years 2024 to 2026. This plan is based on solid revenue growth, a positive outlook for fees and commissions, a strict programme to reduce and discipline operating expenses, and a rationalisation of the cost of risk. It mentions that Greece is producing fewer new exposures and non-performing loans, which is improving the net result.
Piraeus Bank had its best year ever in 2023 and Megalou expects 2024 to be even better. He sees a recovery in market activities, such as IPOs and mergers and acquisitions, and notes that the Greek economy should continue to grow above the European average. It sees an increase in foreign direct investment and market transactions between Greek entities, supported by net credit growth of 5% to 6% over the next few years.
As far as foreign investment is concerned, the network, digital and renewable energy sectors are particularly attractive, with notable activities in energy storage, energy transition and the pharmaceutical sector. Megalou also highlights Greece's important role in agri-food and its potential to become a regional hub.
As far as monetary policy is concerned, Megalou expects the ECB to cut rates in line with forward curve projections. He expects a first cut in June, followed by two or three more by the end of the year. He is in discussions with the regulators about the dividend payout for 2023, anticipating a positive decision which would be a symbol of a return to normality.
