Alpha Bank's Q4 profit exceeded expectations by 16%, with the dividend payout ratio increased to 55%

Investing.com – Alpha Services and Holdings S.A. (ATSE:ALPHA) announced on Friday that its net profit for Q4 2025 was €237 million, exceeding analyst expectations of €204 million by 16%.

This Greek bank’s pre-provision profit was 5% above expectations, driven by fee income exceeding forecasts by 10%, while operating expenses were 4% lower than expected.

Net interest income met expectations, growing 3% quarter-over-quarter, mainly due to the consolidation of Astrobank.

Core net interest income benefited from increased business volume but was partially offset by lower loan spreads, with Greek corporate loan spreads decreasing by 7 basis points quarter-over-quarter.

Loan growth accelerated in Q4, with normal exposure balances increasing 5% quarter-over-quarter and 10% year-over-year, mainly driven by Greek corporate loans.

Excluding Astrobank, loans grew 3% quarter-over-quarter. Total net credit expansion in Q4 was €1.3 billion, up from €700 million in Q3.

Fee income performed strongly across all categories, with notable growth in issuance fees, real estate, and asset management fees. Asset management fees increased 48% year-over-year, with assets under management reaching €22.4 billion, an increase of €1.1 billion from the previous quarter.

Total operating expenses for the year amounted to €856 million, below the company’s guidance of €870 million. The cost-to-income ratio in Q4 was 29%, aided by lower employee costs and depreciation and amortization expenses.

Loan impairments were higher than expected, with risk costs in Q4 at 58 basis points, compared to the market consensus of 45 basis points. The full-year risk cost was 48 basis points, above the 45 basis points guidance.

The bank’s Common Equity Tier 1 (CET1) capital adequacy ratio stood at 15.0%, down 70 basis points from the previous quarter and 40 basis points below expectations. The decline reflected internal capital generation being offset by trading activities and dividend accruals.

Tangible book value per share reached €3.28, up 9% year-over-year.

Alpha Bank increased its 2025 dividend payout ratio from the previously planned 50% to 55%, exceeding market expectations. The distribution will be split between dividends and share buybacks, including the €111 million interim dividend paid in Q4.

Looking ahead to 2026, the bank expects normalized earnings per share of €0.40, in line with current analyst consensus, which is higher than the €0.36 in 2025. Alpha Bank plans to hold an investor day in Q2 2026 to discuss strategic priorities and targets.

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