**Goldman Sachs Anticipates €220 Million Interim Distribution from National Bank of Greece**
Goldman Sachs has projected that the National Bank of Greece (NBG) will announce an interim distribution of approximately €220 million in the third quarter of this year. This expectation comes despite the bank's management neither confirming nor denying the likelihood of such a distribution. The insights were shared in a recent report by Goldman Sachs, which was highlighted by the Greek business outlet Insider.
The anticipation of this interim distribution follows the bank's second-quarter results, which suggested the possibility of returning capital to shareholders. Goldman Sachs has incorporated this expected interim dividend into its forecasts, indicating a strategic shift by NBG towards enhancing shareholder returns.
In terms of future dividends, Goldman Sachs forecasts a gradual increase, projecting a dividend of €0.59 per share for 2026, which is expected to rise to €0.76 in 2027 and further to €0.90 in 2028. Excluding share buybacks, the dividend payout ratio is anticipated to increase from 45% this year to 48.2% in 2027 and 51.7% in 2028. This upward trend in dividend payouts reflects NBG's ongoing commitment to rewarding its shareholders.
However, Goldman Sachs has adjusted its earnings outlook for NBG, reducing its earnings-per-share estimates by 3% for 2026, 1% for 2027, and 2% for 2028. Despite these revisions, the investment bank has acknowledged the bank's continued strength in revenue generation and credit expansion. The updated earnings per share projections are €1.31 for 2026, €1.58 for 2027, and €1.74 for 2028. It is important to note that these figures refer to reported earnings per share and should not be directly compared with NBG's guidance for adjusted earnings per share, which is expected to exceed €1.40 this year.
Goldman Sachs remains optimistic about the overall momentum of the banking group, maintaining that NBG is on track to achieve its target of over €3 billion in credit expansion. The bank's revised guidance for net interest income indicates growth in the mid-single-digit range, with potential for further increases as a portion of the deposits has yet to be transformed into lending.
The investment bank also forecasts that NBG's Common Equity Tier 1 (CET1) capital ratio will be 17.2% by the end of 2026, gradually decreasing to 15.8% by 2028. This projected decline is attributed to rising shareholder distributions alongside organic growth in risk-weighted assets. Goldman Sachs characterizes NBG as the best-capitalized bank within the Greek banking system, predicting that it will leverage its surplus capital for higher distributions and robust credit expansion, while still maintaining a capital buffer for potential strategic opportunities.
In light of these developments, Goldman Sachs has raised its price target for NBG from €18.50 to €18.75, while maintaining a neutral rating on the bank's stock. This adjustment reflects the investment bank's recognition of NBG's improving profitability and its increasing ability to return capital to shareholders, while stopping short of a more aggressive upgrade to its earnings forecasts.
As the third quarter approaches, market participants will be closely watching for any announcements from the National Bank of Greece regarding the anticipated interim distribution and its broader financial performance.