greek banks update jan 2010

8/14/2019 Greek Banks Update Jan 2010

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19 January 2010

Equity Research

Banks GreeceSector Report

UniCredit Research page 1 See last pages for disclaimer.

Greek Banks

Trapped in the Minotaur's maze

The historical correlation between Greek CDS and banks' share prices

suggests, with CDS currently at 313bp, 52% further downside for the

Greek banks. We remain underweight Greek banks, cutting both Alpha

and NBG to Sell and reiterating our Sells on Eurobank and Piraeus. We

cut EPS estimates by 22% p.a. on average, as we believe that reducing

the government deficit will lead to a prolonged Greek recession.

Current CDS spreads imply a 52% further fall in share prices: Wenote the disconnect (see chart below) in the recent movement of Greek

sovereign debt spread vs. banks' valuations. Current sovereign spreadssuggest continuing sharply falling (-52%) banks' valuations, whilst currentbanks' valuations imply spreads of 180bp (currently 313bp).

Greek government bonds: In 3Q09, Greek government bond (GGB)income accounted for nearly 40% of profits on average. Without this,NBG would have been the only bank to cover its cost of equity with plain-vanilla banking business returns.

Prolonged recession highly likely: With the government aiming to cut itsdeficit from 12.7% (2009E) to 3% by 2012, we believe a prolongedrecession in Greece is inevitable, hampering growth and increasing NPLs.

22% average EPS cuts: We lower our EPS estimates on average by 18% in

2010 and 26% in 2011. Key assumptions behind our new estimates are:Greek loan growth 1% in 2010E, 1.5% in 2011E, higher funding costsmeaning lower NIM and rising cost of risk due to a prolonged recession.We are on average 32% below consensus for 2010-11E.

Underweight Greece: We remain underweight Greece, with both Alphaand NBG downgraded to Sell (from Hold), and Eurobank and Piraeus stillSell recommendations. Despite the banks underperforming the sector by19% since our initiations of coverage last August, we see plenty of furtherdownside from current levels.

GREEK BANKS INDEX VS. GREEK 5Y CDS SPREADS

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

0 50 100 150 200 250 300 350

GR CDS

GR

banksindex

2010 2009 2008 2007

Source: Bloomberg, UniCredit Research

AlphaSell(prev. Hold)12M target price: EUR 5.7(prev. EUR 12.0)Current price: EUR 7.15Mcap: EUR 4.1bnFree float: 85%

Eurobank

Sell (prev. Sell)12M target price: EUR 5.6(prev. EUR 8.0)Current price: EUR 7.28Mcap: EUR 4.1bnFree float: 58%

NBGSell (prev. Hold)12M target price: EUR 14.4

(prev. EUR 23.0)Current price: EUR 16.71Mcap: EUR 10.1bnFree float: 100%

PiraeusSell (prev. Sell)12M target price: EUR 5.6(prev. EUR 7.4)Current price: EUR 7.16

Mcap: EUR 2.5bnFree float: 93.5%

Tania Gold, Equity Analyst (UniCredit Bank London)+44 20 7826 [email protected]


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19 January 2010 Equity Research

Greek Banks


Contents

Investment case 3

CDS vs. share price disconnect 4

Greek government bond income one-third of profit 8

Reducing earnings estimates by 22% 11

Company Forecasts

Alpha Bank 18

Eurobank 21

NBG 24

Piraeus 27


3/36


Greek Banks


Investment case

We remain underweight Greek banks, downgrading Alpha and NBG to Sell and reiteratingour Sell recommendations on Eurobank and Piraeus. We cut our earnings estimates by

22% p.a. on average to reflect the deteriorating macro environment in Greece. We also

calculate that only NBG is covering its cost of equity, with returns from plain-vanilla

banking operations, i.e. excluding income from Greek government bonds (GGBs). We

also note the disconnect that has recently appeared between the spread-widening of

5Y Greek sovereign debt and the fall in the share prices of the Greek banks. This leads

us to believe that a recovery in sovereign spreads is unlikely to fuel a large rally in the

Greek banking index and that the risk is more on the downside. Current CDS levels imply

52% downside risk for the Greek banking sector.

Trapped in the Minotaur's maze

The Greek banks could be considered unlucky. Unlike the investment banks, they did notinvest in toxic assets; unlike the Irish banks, they have not been heavily involved in a collapsingarea such as lending to real estate developers. They are somewhat victims of circumstanceand there is little they can do to change the macro situation of their home market.

The Greek government recently announced that it plans to cut the deficit to GDP to 3% by2012, from an estimated 12.7% in 2009. Should they be able to do this without any externalhelp, we would expect to see much fiscal tightening in Greece and a prolonged recession.There is also the risk of social unrest.

Disconnect between sovereign spreads / banks' share prices

Usually, CDS and banks' share prices are tightly correlated, but we have discovered that the

recent widening of spreads in 5Y Greek sovereign debt has not been fully matched by a fall inthe share prices of the Greek banks. Therefore we see it as unlikely that any tightening of thespreads will provide a large rally in banks' share prices. There is the risk of a catch-up inshare prices to where Greek CDS spreads are now, should they remain this high (313bpcurrently), leaving a large 52% downside risk to current prices. At current levels, the marketappears to be pricing in Greek sovereign spreads of 180bp.

GGB income over one-third of 3Q09 profits

We look at Greek government bond exposures and see that in 3Q09 alone it accounted for onaverage nearly 40% of Greek banking sector profits. Excluding this income, NBG is the onlyGreek bank to cover its cost of equity with plain-vanilla banking business returns. Thesepositions are mainly funded by cheap liquidity from the ECB. This will need re-financing withinthe next 12 months and we calculate that for every 50bp extra this costs to refinance, it wouldrange from 2% of NBG's 2010E profits to 20% of Piraeus' 2010E profits.

Cutting EPS estimates on average 22%

We cut our EPS estimates by 22% per annum on average to reflect the continual deterioratingmacro environment in Greece. The main adjustments are:

reduction in domestic loan growth

reduction in domestic NIM

increase in domestic cost of risk

increase in domestic tax chargesWe are now on average 32% below consensus for 2010E and 2011E.


4/36


Greek Banks


CDS vs. share price disconnect

In recent weeks, a disconnect looks to have appeared between the Greek 5Y sovereignspread and banks' valuations, with sovereign spreads having widened much more than

banks' valuations have fallen. Should sovereign spreads stay at the current high levels of

313bp, we believe Greek banks' valuations would have a further 52% to fall. But should

spreads tighten, we see only a minimal rally. It appears the market is currently pricing in

a Greek 5Y CDS spread of 180bp.

Greek CDS currently double that of Ireland

First we look at the CDS spreads of the countries that are popularly considered in the marketto be the "strugglers" in Europe, especially on a macro level: Greece, Ireland, Spain and Portugal.

FIVE-YEAR CDS

0

50

100

150

200

250

300

350

400

450

Jan-08

Mar-08

May-08

Jul-08

Sep-08

Nov-08

Jan-09

Mar-09

May-09

Jul-09

Sep-09

Nov-09

Jan-10

Greece Ireland Portugal Spain


From the chart above, it is clear that Greece has recently overtaken Ireland in the cost of

insuring its debt and therefore the risk perception of the country. This is not really a surprisegiven the admission of the new government that the expected deficit to GDP was much higherthan initially thought. Now Greece takes the spot of worst performer in the EMU when lookingat the government deficit to GDP in 2009 and runner-up for debt to GDP.


5/36


Greek Banks


KEY MACRO INDICATORS

Government deficit to GDP (%) Debt to GDP (%)

-14

-12

-10

-8

-6

-4

-2

0

GR IE UK ES PT FR BE IT NL AT DE FI

0

20

40

60

80

100

120

FI ES NL IE UK AT DE PT FR BE GR IT

Source: Bloomberg, EU Commission, UniCredit Research

52% downside implied in current sovereign spreads

The real question will be where these CDS spreads will settle. Given that Greece on a macrolevel looks riskier than Ireland, in our view, we struggle to see Greece's CDS settling belowthe Irish 150bp mark in the near future.

We are not trying to forecast Greek CDS, but as we show in the charts below, current banks'valuations imply that spreads will tighten or the banks' valuations will continue to fall.

RELATIVE PERFORMANCE OF GREEK BANKS VS. EURO BANKS ON PRICE AND CDS

Relative performance of Greek banks vs. Euro banks on price and CDS Relative performance of Greek banks vs. Euro banks on price vs. CDS

50

70

90

110

130

150

170

Apr-05

Jul-05

Oct-05

Jan-06

Apr-06

Jul-06

Oct-06

Jan-07

Apr-07

Jul-07

Oct-07

Jan-08

Apr-08

Jul-08

Oct-08

Jan-09

Apr-09

Jul-09

Oct-09

Jan-10

0

100

200

300

400

500

GR banks vs EU banks price GR vs EU CDS

0

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

1.8

2

Jan-06

Apr-06

Jul-06

Oct-06

Jan-07

Apr-07

Jul-07

Oct-07

Jan-08

Apr-08

Jul-08

Oct-08

Jan-09

Apr-09

Jul-09

Oct-09

Jan-10



6/36


Greek Banks


GREEK BANKS INDEX VS. GREEK 5Y CDS

y = 6881.5e-0.0057x

R2

= 0.8672

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

0 50 100 150 200 250 300 350

GR CDS

GR

banksindex

2010 2009 2008 2007


Looking at the chart above, it appears that recently a disconnect between Greek CDS andbank share price movements has appeared; with the Greek CDS widening whilst the banksshare prices have fallen less than would be implied. This could mean a couple of things. First,

that the market believes the CDS spreads at 313bp for Greece are too high, or second thatthe share prices still might fall considerably further to catch up with the higher CDS.

We are not going to try and forecast CDS spreads for Greece, but we do believe that even ifthere is a tightening of spreads, given that the share prices have not fallen that much incomparison, they will not rise that much in a tightening era. Therefore on this basis there iscurrently limited upside to the banks share prices. But there is the risk that CDS spreads staynear current levels and banks share prices continue to fall. The chart above implies this wouldmean a massive 52% fall in banks' valuations not our base case scenario. Looking at it theother way around, current share prices indicate a CDS spread of 180bp.

We repeat the above chart, but for each individual stock price vs. Greek CDS, and see thatthere is considerable downside risk at each bank.


7/36


Greek Banks


INDIVIDUAL SHARE PRICE VS. GREEK CDS

Alpha Eurobank

y = 22.258e-0.0058x

R2

= 0.8581

0

5

10

15

20

25

0 50 100 150 200 250 300 350

GR CDS

AlphaPR

y = 23.111e

-0.0063x

R2

= 0.8648

0

5

10

15

20

25

30

0 50 100 150 200 250 300 350

GR CDS

EurobankPR


INDIVIDUAL SHARE PRICE VS. GREEK CDS

NBG Piraeus

y = 37.807e-0.0046x

R2

= 0.8249

0

5

10

15

20

25

30

35

40

45

0 50 100 150 200 250 300 350

GR CDS

NBGP

R

y = 24.853e

-0.0063x

R2

= 0.8711

0

5

10

15

20

25

30

0 50 100 150 200 250 300 350

GR CDS

Piraeu

sPR



8/36


Greek Banks


Greek government bond income one-third of profit

Looking at Greek government bonds (GGBs), each bank has a sizeable portfolio with theincome from these bonds generating nearly 40% of 3Q09 bottom-line profit. NBG is the

only Greek bank that covers its cost of equity with returns from plain-vanilla banking

business (i.e. excluding government bond income). These GGBs appear to have been

funded mainly with cheap ECB financing, which matures over the next 12 months. For

every 50bp extra that it costs to refinance this ECB funding, it would range from 2% off

NBG's 2010 profits to 20% at Piraeus.

We cannot write a note on the Greek banks without mentioning Greek government bonds(GGBs) although it is hard to estimate the impact these portfolios will have on earnings dueto a lack of disclosure on duration. NBG is the only bank to have given enough disclosure todetermine the impact for 4Q09. In its 3Q09 presentation, it showed us that for every 1bpmovement in the spread of GGBs there would be up to a EUR -0.5mn movement in the tradingline and EUR -4.7mn movement in the AFS. Given that the spreads tightened 100bp vs. thebund in 4Q09, that will leave us with a EUR 50mn hit to trading and a EUR 470mn hit toequity. It is worth noting that in Greece any movement in the AFS and therefore equity do notflow through to capital, so there will be no impact on the tier 1 ratio.

GREEK GOVERNMENT BONDS AND ECB FUNDING (EUR BN)

ECB funding GGBs

Alpha 9 3

Eurobank 6 5

Piraeus 5 6.2

NBG 9.5 18

Source: Company data, UniCredit Research

What is interesting to note is that both Alpha and Eurobank have more ECB funding thanGGBs, therefore potentially implying they are using some of this funding for the operatingbusiness. Although looking at Alpha's balance sheet, it might have placed this excess fundingin the interbank market. Either way, when this ECB funding rolls off it could lead to a decentincrease in funding costs.

BONDS OUTSTANDING

Bonds outstanding by maturity (EUR bn) Cumulative maturity of debt outstanding (indexed to 100)

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

2010 2011 2012 2013 2014 2015 >2015

Alpha Eurobank NBG Piraeus

0

10

20

30

40

50

60

70

80

90

100

2010 2011 2012 2013 2014 2015 >2015


Source: Company data, Bloomberg, UniCredit Research


9/36


Greek Banks


Range of 2%-22% off profits for every 50bp extra refinancing cheapECB liquidity and wholesale funding in 2010

We look at the impact for each bank on 2010 profit of refinancing this cheap ECB funding withmore expensive funding. For every 50bp extra it costs to refinance, this ranges from 2% offNBG's 2010 profits to 20% at Piraeus.

It would be harsh to assume that as Greek CDS spreads have gone from 50bp a couple ofyears ago to over 300bp in 2010 that the cost of renewing this wholesale funding would beover 250bp higher. Instead we look at the impact that an extra 50bp on the cost of thiswholesale funding would do to profits.

PROFIT IMPACT FROM HIGHER COST OF FUNDING

Profit impact from 50bp higher cost when refinancing cheap ECBliquidity

Profit impact from 50bp higher cost when refinancing maturingwholesale funding

-20

-18

-16

-14

-12

-10

-8

-6

-4

-2

0


-3.0

-2.5

-2.0

-1.5

-1.0

-0.5

0.0


2010 2011

Source: UniCredit Research

3Q09 Greek government bond income nearly 40% of profits

Another interesting angle in relation to Greek government bonds is the amount of earningseach bank would have made in 3Q should they not have owned the GGBs. We therefore stripout the net interest income associated with the GGBs at 3Q and also the trading income. Weassume no costs associated with this income, but a 25% tax rate. For Alpha and NBG, wetake a best guess for the amount of NII and trading for GGBs and they do not disclose thenumbers. As shown in the table below, on average over one-third of 3Q09 profits were fromGGBs on our calculations.

Also, we can clearly see a large drop in the annualized tangible RoE of each bank. We cannotignore the positive effect of this income as it does help to absorb loan loss provisions, but wealso see this as low-quality income and highlight that apart from NBG, none of the banks werecovering their cost of equity with returns from plain-vanilla banking operations (i.e. excludingGGB income) in 3Q09.


10/36


Greek Banks


3Q09 NET PROFIT EXCLUDING INCOME FROM GGBs

EUR mn Alpha Eurobank NBG Piraeus

Net profit reported 130 111 301 90

- less GGB NII -22 -60 -67 -40

- less GGB trading income -30 0 -25 -30

- plus tax on GGB income 13 15 23 18

Total adjustment to profit -39 -45 -69 -53

Adjusted net profit 91 66 232 38

% change in net profit -30% -41% -23% -58%

Annualized tangible RoE (%) 16% 13% 22% 13%

Annualized tangible RoE (excl. GGB income) (%) 11% 8% 17% 5%

Source: Company data, UniCredit Research


11/36


12/36


Greek Banks


Reduced loan growth

Given the current macro picture in Greece, we find it hard to see loans growing at an industry

level above 1% in 2010 and 1.5% in 2011. Greece does have low credit penetration vs. otherWestern European countries at 103% (average in Europe 141%), but we believe continualfalling demand and constricted supply would hamper Greece returning to above-averageEuropean growth levels during this recessionary period.

GREECE VS. EUROZONE CREDIT TO GDP (%)

141

81

43

17

103

55

32

16

117

63

38

16

83

45

25

13

0

20

40

60

80

100

120

140

160

Total credit/GDP Corp credit/GDP Mortgage credit/GDP Cons credit/GDP

Euro Area 08 Greece 08 Euro Area 05 Greece 05

Source: Bank of Greece, ECB, UniCredit Research

Reduced NIM

We decrease our domestic net interest margin and therefore net interest income projectionsfor a couple of reasons:

Rising funding costs in 2010, as Greece is now considered significantly more risky acountry than it was six months ago (as evidenced by the rise in CDS spreads), which willpush up the cost of wholesale funding. Also, with higher wholesale funding costs, we believewe might see more competition in deposits and therefore we lower the improvement weexpect to see in both sight and time deposit spreads for 2010 and 2011 (see appendix fordetailed breakdown of domestic NIM forecasts).

2009 asset re-pricing complete. We see little room for further asset re-pricing. Also, whenfor example Eurobank calculates its asset spreads, it does this vs. an internally weightedcost of funding. Some of this will be wholesale funding, so reported asset spreads are

likely to fall here. Should CDS spreads stay at these high current levels, then there is thepotential that some of the higher funding costs may be offset by higher than previouslyexpected assets spreads. But this would then be matched off by higher than expectedprovisions, in our view.

Also, we cannot ignore the level of ECB funding that we believe the Greek banks are currentlyusing to fund their government bond portfolios.

The guidance from management on NIM has been for it to continue rising due to betterdeposit spreads. As we have said, this is not something we forecast to occur as quickly as theGreek banks would like, and therefore we see domestic NIM being at best stable in 2010 forthe majority of the banks. For NBG, we expect it to fall, mainly due to the large GGB portfolionot earning the same spread as in 2009 due to higher funding costs.


13/36


Greek Banks


Although NBG is in a strong position, with a domestic loan-to-deposit ratio of 87%, theseexcess deposits appear to have been used to fund the purchases of Greek governmentbonds. Therefore this benefit is of relatively minimal value unless it were to sell a sizeable

portion of its government bond portfolio.

DOMESTIC NIM

2.0%

2.5%

3.0%

3.5%

4.0%

4.5%

5.0%

5.5%

6.0%

2007 2008 2009E 2010E 2011E


Source: Company data, UniCredit Research estimates

Flat domestic cost of risk 2010

Unlike other European countries, the recession in Greece (along with Ireland and Spain) isexpected to continue into 2010, and in our view even longer. With the macro news continuingto get worse in Greece, unemployment rising (currently 10%), we now believe NPLs will peaktoward the end of 2010/early 2011 rather than in 1H10 and thus raise our cost-of-risk forecasts.

We also try to look at the cost of risk on an underlying basis. All Greek banks (to varyingdegrees) booked collective provisions in 4Q08 (in fact Alpha was very prudent and alsobooked one in 3Q08).

COLLECTIVE PROVISIONS

Alpha Eurobank Piraeus NBG

Collective provision booked in 2008 (EUR mn) 235 240 215 80

Collection provision / av. 2008 gross loans (bp) 50 46 62 1

Source: Company data, UniCredit Research estimates

Alpha did not disclose its collective provision booked, but we calculate what we consider areasonable estimate by using the other Greek banks' 2008 provision charge movement asguidance, normalizing 3Q08 and 4Q08 and assuming that the difference in provisions bookedin the P&L are all collective.

On the 3Q09 conference call, Eurobank told us that it had "used" half of its collective provisionand we use the same assumption for NBG when calculating its underlying cost of risk. ForAlpha and Piraeus, we look at the fall in coverage since 4Q08 and assume this is due to newNPLs which do not need any extra provisioning as they are covered by the collectiveprovision. We accept that this does not take into account any change in mix in NPLs, etc, butbelieve it gives good guidance as to what the banks have been doing.


14/36


Greek Banks


COST OF RISK REPORTED VS. UNDERLYING

Reported cost of risk (bp) Underlying cost of risk (bp)

0

50

100

150

200

250

2005 2006 2007 2008 2009E 2010E 2011E


0

50

100

150

200

250

2005 2006 2007 2008 2009E 2010E 2011E



In our initiation report, "Beware Medusa's stare", published 18 August 2009, we calculate thatboth Piraeus and Eurobank had underprovided to date. We still believe that both banks haveunderprovided and, when looking at their coverage ratios compared with other European banks,they are at the lower end. If using the collective provision continues to reduce coverage, webelieve the market will not react well to this.

COVERAGE (%)

0

10

20

30

40

50

60

70

80

Lloyds

BARC

UBS

Eurobank

BPE

Piraues

RBS

DBK

NBG

UBI

BP

MPS

ISP

Alpha

PMI

STAN

CS

BBVA

SAN

HSBC

Generic portion

av. 53


Target prices cut 36%

We lower our target prices for each of the Greek banks. This is due to three reasons:

1. Reduction in EPS (see above) for an explanation

2. Increased CoE to take into account the higher risk-free rate that Greece now bears vs. sixmonths ago

3. Lower sustainable RoE as we are starting to believe Greece will not return to the growthwe expected previously


15/36


Greek Banks


Sum-of-the-parts (SOTP) models

We value each of the Greek banks using a sum-of-the parts methodology (SOTP);

We roll forward our valuations to use 2011 estimates (rather than 2010)

Allocate RWA to each division if not already done by the company

Allocate capital to each division as a % of RWA; 7% Greece, 10% EME, 12%Turkey

Estimate sustainable ROE for each division and in turn calculate a P/B, with theexception of corporate centers and asset management divisions which are valuedon a P/E multiple basis

Comparing our allocated equity to equity Tier 1 capital, we then add/deduct theexcess/deficit at 1x book.

Alpha SOTP new target price EUR 5.7

ALPHA SUM OF THE PARTS

EUR mn Value Valuation tool Equity2011

Net profit2011

RoE2011 (%)

SustainableRoE (%)

CoE%

Growth%

P/NAV ImplicitP/E

2011E

Retail 1,173 RoE-CoE 1,052 159 15.1 15.5 14 1.0 1.12 6.6

Commercial & corporate 925 RoE-CoE 1,336 110 8.3 10.0 14 1.0 0.69 7.4

SE Europe 866 RoE-CoE 1,237 105 8.5 10.0 13 3.0 0.70 7.3

Investment banking & treasury 288 RoE-CoE 625 33 5.3 7.0 14 1.0 0.46 7.7

Asset mgmt & insurance 55 RoE-CoE 64 5 7.3 12.0 14 1.0 0.85 10.3Total operating business (I) 3,306 4,313 413 7.1

Corporate centre, minorit ies + prefs (II) -454 P/E multiple -64 7.1

Excess capital at 1xP/BV (III) 562 562 6

Group (I+II+III) 3,414 4,875 355

No. of shares (mn) 534

12M target price (EUR) 5.7

Current price (EUR) 7.15

Upside/(downside) -20.4%

Source: UniCredit Research estimates


16/36


Greek Banks


Eurobank SOTP New 12M target price EUR 5.6

EUROBANK SUM OF THE PARTS

EUR mn Value Valuationtool

Equity2011E

Profit2011E

RoE2011E (%)

SustainableRoE

CoE(%)

Growth(%)

P/NAV Implied.target

P/E

Retail 994 RoE-CoE 731 134 18.4 18.5 14.0 1.5% 1.36 6.6

Corporate 1,429 RoE-CoE 1,190 195 16.4 16.5 14.0 1.5% 1.20 6.5

AM, PB, INS 207 P/E multiple 18 17 N/A N/A NA NA N/A 10.7

Treasury & capital mkts 753 RoE-CoE 653 104 15.9 16.0 14.0 1% 1.15 6.5

SEE 869 RoE-CoE 1,737 60 3.4 8.5 13.0 4.0% 0.50 13.0

Total operating (I) 4,251 4,329 510 7.4

Other non operating (II) -667 P/E multiple 140 -80 7.4

Excess capital (III) -135 -135 -1

Group ( I+I I+I II ) 3,448 4,333 428

No. shares (mn) 538

12M TP (EUR) 5.6


Upside/downside -23%


NBG SOTP New 12M target price EUR 14.4

NBG SUM OF THE PARTS

EUR mn Valuation Valuation tool Equity Netprofit

2011E

RoE 11E SustainableRoE

CoE(%)

Growth(%)

P/B (x) Implied10 P/E

Retail 1,241 RoE-CoE 1,152 172 14.9 15.0 14.0 1.0 1.08 6.4

Corporate, Investment banking & Insurance 1,603 RoE-CoE 906 224 24.7 24.0 14.0 1.0 1.77 6.3

Global mkts & asset mgmt 577 RoE-CoE 577 434 75.2 14.0 14.0 1.0 1.00 1.2

S&EE (excl FB) 1,276 RoE-CoE 1,276 159 12.5 13.0 13.0 3.0 1.00 7.2

Finansbank 4,577 RoE-CoE 2,397 591 24.6 25.0 15.0 4.0 1.91 6.8

Total operating business(I) 9,274 6,309 1,580 5.2

Other -1,601 P/E multiple 272 (273) 5.2

Total group (I+II) 7,672 8,899 1,307

Excess equity (III) 2,319 2,319 23

Total (I+II+II) 9,991 8,899 1,330

Shares (mn) 607

12-month target price (EUR) 14.4


Upside/downside -14%



17/36


Greek Banks


Piraeus SOTP New 12M target price EUR 5.6

PIRAEUS SUM-OF-THE-PARTS

EUR mn Value Valuationtool

Equity2011E

Net profit2011E

RoE2011E

(%)

SustainableRoE (%)

CoE % Growth%

P/NAV ImplicitP/E

2011E

Greece 576 RoE-CoE 1,497 79 5.3 6.0 14 1.0 0.38 6.5

SE Europe 1,433 RoE-CoE 1,837 190 10.3 10.8 13 3.0 0.78 6.8

Total operating business (I) 2,008 3,334 268 6.7

Excess capital at 1xP/BV (III) 40 40 0

Group (I+II+III) 2,048 3,374 269

No. of shares (mn) 325

12M target price (EUR) 5.6


Upside/downside -22.3%



18/36


Greek Banks


Financials Alpha Bank

ALPHA P&L

2007 2008 2009E 2010E 2011E

Net interest income EUR mn 1,605 1,799 1,779 1,822 1,847

as a percentage of total revenues % 72 77 73 76 76

Net fees & commissions EUR mn 465 464 387 403 419


Net trading income EUR mn 82 -7 181 76 80


Other operating income EUR mn 84 82 75 84 88

Total revenue EUR mn 2,236 2,339 2,422 2,385 2,434

Personnel expenses EUR mn -559 -700 -673 -670 -667

Other operating expenses EUR mn -361 -390 -421 -455 -492

Depreciation & amortization EUR mn -78 -88 -98 -110 -123Total expenses EUR mn -998 -1,178 -1,193 -1,235 -1,282

as a percentage of total revenues % -45 -50 -49 -52 -53

Operating profit before risk EUR mn 1,237 1,160 1,229 1,150 1,152

Loan loss provisions EUR mn -227 -542 -680 -662 -606

Net operating profit EUR mn 1,011 619 549 487 545


Non operating income (net) EUR mn -2 7 -4 0 0

Profit before tax (PBT) EUR mn 1,011 619 549 487 545


Tax expense EUR mn -215 -112 -112 -117 -131

Profit after tax (PAT) EUR mn 796 506 437 370 414

Exceptional items EUR mn 55 0 -13 0 0Minorities (equity) EUR mn -2 -1 -1 -1 -1

Preference dividends EUR mn -51 -59 -104 -87 -59

Net profit attributable to common equity EUR mn 798 447 319 282 355


UCG adjusted EPS EUR 1.66 1.00 0.69 0.53 0.66

Source: Alpha, UniCredit Research estimates


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Greek Banks


ALPHA KEY RATIOS

2007 2008 2009E 2010E 2011E

Per share data

Reported EPS EUR 2.10 1.26 0.69 0.53 0.66


Book value per share EUR 8.20 7.35 8.31 8.60 9.02

Tangible book value per share EUR 7.87 6.96 7.99 8.28 8.70

Dividend per share EUR 0.90 0.00 0.24 0.24 0.31

Year end shares in issue (Million) mn 411 411 534 534 534

Valuation ratios

P/E (UCG adjusted EPS) x 13.0 15.7 11.2 14.7 11.7

P/BV x 2.6 2.1 0.9 0.9 0.9

P/tBV x 2.8 2.3 1.0 0.9 0.9

Dividend yield % 4.1 0.0 3.0 3.1 4.0

Payout ratio % 43 0 34 46 47

P&L data


Total expenses EUR mn -998 -1,178 -1,193 -1,235 -1,282




UCG adjusted net profit EUR mn 741 454 328 282 355

Profitability ratios

Adjusted return on average risk weighted assets % 1.8 0.9 0.7 0.5 0.7

Adjusted return on average assets % 1.4 0.8 0.5 0.4 0.5

Adjusted return on average shareholders' equity % 24.3 14.2 8.8 6.3 7.5

Adjusted return on average tangible shareholders' equity % 25.3 14.9 9.2 6.5 7.8

P&L ratios

Net interest income / average total assets % 3.1 3.0 2.7 2.6 2.6

Cost income ratio % 45 50 49 52 53

Compensation expenses to total revenue % 25 30 28 28 27

Loan loss provisions / average customer loans % 0.61 1.17 1.33 1.27 1.13

Tax rate % 21 18 21 24 24

Capital ratios

Equity Tier 1 ratio % 6.0 6.5 8.9 9.0 9.0

Tier 1 ratio % 7.8 8.3 12.0 10.1 10.1

Total capital ratio % 10.1 10.1 9.7 9.7 9.7

Assets / shareholders' equity x 16 22 15 15 15

Assets / tangible shareholders' equity x 17 23 16 16 15

Assets / Tier 1 capital x 14 16 11 13 13

Structural data

Total assets EUR bn 55 65 68 70 72

Customer loans EUR bn 42 51 51 52 54

Customer deposits EUR bn 35 43 43 44 45

Loan/deposit ratio % 121 119 121 120 120

Shareholders' equity EUR bn 3.4 3.0 4.4 4.6 4.8

Tangible shareholders' equity EUR bn 3.2 2.9 4.3 4.4 4.6

RWA EUR bn 50 50 51 52 54



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Greek Banks


ALPHA DOMESTIC NII

EUR mn 1Q09 2Q09 3Q09 4Q09E 2009E 2010E 2011E

Domestic NII 304 346 350 357 1,357 1,394 1,381

Spreads

Mortgages 143 167 171 175 164 150 125

Consumer 784 842 859 875 839 775 725

SBL 690 733 737 740 728 700 650

M&L corporate 193 228 233 240 225 200 175

Sight & savings 112 79 52 30 71 50 100

Time (112) (92) (90) (80) -92 (10) 0

Balances

Mortgages 11,186 11,184 11,191 11,191 11,191 11,303 11,462

Consumer 4,972 5,031 5,127 5,165 5,165 5,216 5,290

SBL 5,063 5,122 5,119 5,119 5,119 5,170 5,243

M&L corporate 18,254 18,344 18,329 18,329 18,329 18,513 18,774

Total 39,475 39,681 39,766 39,804 39,804 40,203 40,769

Sight & savings 12,400 14,014 14,400 15,209 15,209 15,196 15,470

Time 22,100 22,000 20,900 21,213 21,213 21,730 22,664

NII earned

Mortgages 40 47 48 49 183 169 142

Consumer 97 105 109 113 424 402 381

SBL 87 93 94 95 369 360 338

M&L corporate 88 104 107 110 409 368 326

Total 312 350 358 366 1,385 1,300 1,188

Sight & savings 35 26 18 11 91 76 153

Time -59 -51 -48 -42 -200 -21 0

Total -24 -25 -30 -31 -109 55 153

Total NII from loans & deposits 288 325 328 335 1,276 1,354 1,341

Other NII 16 21 22 22 81 40 40

Total NII 304 346 350 357 1,357 1,394 1,381

NIM (%) 3.09% 3.50% 3.53% 3.59% 3.44% 3.48% 3.41%



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22/36


Greek Banks


EUROBANK KEY RATIOS

2007 2008 2009E 2010E 2011E

Per share data

Reported EPS EUR 1.60 1.20 0.49 0.49 0.80






Valuation ratios


P/BV x 3.0 2.1 0.9 0.9 0.8

P/tBV x 3.6 2.7 1.1 1.0 0.9

Dividend yield % 3.4 0.0 0.0 1.8 2.9

Payout ratio % 51.3 0.0 0.0 28.0 28.0

P&L data


Total expenses EUR mn -1,354 -1,566 -1,477 -1,510 -1,583

Loan loss provisions EUR mn -401 -886 -1,166 -1,141 -932









P&L ratios


Cost income ratio % 48.1 47.8 48.6 48.5 49.8

Compensation expenses to total revenue % 25.8 25.7 26.1 26.0 26.8


Tax rate % 18.9 17.2 11.3 22.0 23.2

Capital ratios


Tier 1 ratio % 9.2 8.0 11.4 9.6 9.7





Structural data







RWA EUR bn 46 48 49 51 54

Source: Eurobank, UniCredit Research estimates


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EUROBANK DOMESTIC NII

EUR mn 1Q09 2Q09 3Q09 4Q09E 2009E 2010E 2011E

Domestic NII 362 399 408 416 1,585 1,631 1,581

Spreads

Mortgages 122 125 130 135 127 125 100

Consumer 980 981 985 980 975 925 850

SBL 504 514 520 525 512 475 425

Wholesale 217 237 240 245 234 225 200

Sight & savings -6 -24 -24 -10 -16 15 65

Time -102 -90 -75 -50 -79 -10 0

Balances

Mortgages 10300 10300 10410 10410 10,410 10,514 10,662

Consumer 8000 8020 7570 7570 7,570 7,646 7,754

SBL 7000 7000 7080 7080 7,080 7,169 7,270

Wholesale 16600 16683 17420 17420 17,420 17,595 17,842

Total 41,900 42,003 42,480 42,480 42,480 42,924 43,528

Sight & savings 12,000 12,434 12,319 12,830 12,830 12,919 13,962

Time 25,000 25,000 25,000 25,000 25,000 25,125 25,251

NII earned

Mortgages 32 32 34 35 133 131 106

Consumer 200 196 192 185 774 704 654

SBL 89 90 92 93 363 338 309

Wholesale 90 99 102 107 398 394 354

Total 410 417 419 420 1,667 1,567 1,424

Sight & savings -2 -7 -7 -3 -20 19 87

Time -64 -56 -47 -31 -198 -25 0

Total -66 -64 -54 -34 -218 -6 87

Total NII from loans & deposits 345 354 365 386 1,449 1,561 1,511

Other NII 17 46 43 30 136 70 70

Total NII 362 399 408 416 1,585 1,631 1,581

NIM (%) 3.43% 3.81% 3.86% 3.92% 3.73% 3.82% 3.66%

Source: Eurobank, UniCredit Research estimates


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Financials NBG

NBG P&L

2007 2008 2009E 2010E 2011E

Net interest income EUR mn 3,050 3,580 3,897 3,889 4,145




Net trading income EUR mn 277 407 446 240 240


Net insurance income EUR mn 93 123 101 108 112

Other operating income EUR mn 217 68 -33 102 115


Personnel expenses EUR mn -1,388 -1,378 -1,446 -1,496 -1,581

Other operating expenses EUR mn -745 -805 -845 -874 -924Depreciation & amortization EUR mn -147 -163 -172 -177 -188



Operating profit before risk EUR mn 2,130 2,603 2,640 2,533 2,722


Net operating profit EUR mn 1,800 2,083 1,644 1,550 1,873


Non operating income (net) EUR mn 17 0 0 2 4

Profit before tax (PBT) EUR mn 1,817 2,083 1,645 1,552 1,877



Profit after tax (PAT) EUR mn 1,578 1,711 1,305 1,211 1,464

Exceptional items EUR mn 105 -126 -36 0 0

Minorities (equity) EUR mn -19 -39 -38 -39 -47

Preference dividends EUR mn -92 -100 -110 -102 -93

Net profit attributable to common equity EUR mn 1,572 1,447 1,120 1,070 1,324



Source: NBG, UniCredit Research estimates


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Greek Banks


NBG KEY RATIOS

2007 2008 2009E 2010E 2011E

Per share data

Reported EPS EUR 3.23 2.93 2.10 1.76 2.18






Valuation ratios


P/BV x 2.8 2.4 1.3 1.2 1.1

P/tBV x 5.1 4.3 1.9 1.7 1.5

Dividend yield % 3.7 0.0 3.6 4.0 5.5

Payout ratio % 43.3 0.0 28.7 37.9 42.4

P&L data




Profit before tax (PBT) EUR mn 1,817 2,083 1,645 1,552 1,877

Net profit attributable to common equity EUR mn 1,572 1,447 1,120 1,070 1,324

UCG adjusted net profit EUR mn 1,467 1,573 1,157 1,070 1,324






P&L ratios


Cost income ratio % 52 47 48 50 50

Compensation expenses to total revenue % 31 28 28 29 29


Tax rate % 13 18 21 22 22

Capital ratios


Tier 1 ratio % 9.2 10.0 12.2 12.0 12.2





Structural data







RWA EUR bn 53 63 68 72 77

Source: NBG, UniCredit Research estimates


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27/36


Greek Banks


Financials Piraeus

PIRAEUS P&L

2007 2008 2009E 2010E 2011E

Net interest income EUR mn 917 1,160 1,105 1,161 1,189




Net trading income EUR mn 81 8 155 80 80


Other operating income EUR mn 256 243 176 185 207


Personnel expenses EUR mn -379 -459 -456 -466 -482

Other operating expenses EUR mn -299 -362 -360 -368 -382

Depreciation & amortization EUR mn -66 -80 -80 -81 -70Total expenses EUR mn -744 -901 -895 -915 -935


Operating profit before risk EUR mn 736 750 749 725 763


Net operating profit EUR mn 620 362 290 214 330


Non operating income (net) EUR mn 17 24 15 16 16

Restructuring charges EUR mn 0 0 0 0 0

Goodwill impairment EUR mn 0 0 0 0 0

Profit before tax (PBT) EUR mn 637 386 305 230 346



Profit after tax (PAT) EUR mn 534 331 250 184 277

Exceptional items EUR mn 118 0 0 0 0

Minorities (equity) EUR mn -29 -16 -8 -6 -8

Preference dividends EUR mn 0 0 -21 -7 0




Source: Piraeus, UniCredit Research estimates


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PIRAEUS KEY RATIOS

2007 2008 2009E 2010E 2011E

Per share data

Reported EPS EUR 2.14 0.97 0.74 0.51 0.83






Valuation ratios


P/BV x 2.7 1.9 0.8 0.8 0.7

P/tBV x 3.0 2.1 0.8 0.8 0.8

Dividend yield % 2.9% 0.0% 1.7% 1.7% 2.6%

Payout ratio % 34% 0% 17% 26% 24%

P&L data


Total expenses EUR mn -744 -901 -895 -915 -935


Profit before tax (PBT) EUR mn 637 386 305 230 346








P&L ratios


Cost income ratio % 50.3 54.6 54.4 55.8 55.0

Compensation expenses to total revenue % 25.6 27.8 27.7 28.4 28.4


Tax rate % 16.2 14.1 18.0 20.0 20.0

Capital ratios


Tier 1 ratio % 9.8 8.0 9.6 8.7 8.9





Structural data







RWA EUR bn 31 38 37 38 40



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Greek Banks


PIRAEUS DOMESTIC NII

EUR mn 1Q09 2Q09 3Q09 4Q09E 2009E 2010E 2011E

Domestic NII 162 173 176 182 694 741 746

Spreads

Mortgages 203 211 220 225 213 200 175

Consumer 804 810 820 825 805 775 675

SME 336 342 345 350 341 325 275

M&L 176 177 175 175 174 150 130

Sight & savings 37 23 0 0 15 15 65

Time -117 -109 (90) (75) -97 (35) 0

Balances

Mortgages 5,920 5,855 5,939 5,969 5,969 6,029 6,114

Consumer 3,387 3,334 3,267 3,267 3,267 3,299 3,346

SME 6,307 6,293 6,352 6,384 6,384 6,448 6,539

Corp 14,039 14,006 14,139 14,209 14,209 14,352 14,554

Total 29,653 29,488 29,697 29,829 29,829 30,129 30,553

Sight & savings 6796 7499 7451 7490 7,490 7580 7938

Time 19417 19283 19159 19417 19,417 19491 20411

NII earned

Mortgages 30 31 32 33 127 120 106

Consumer 69 68 68 67 272 254 224

SME 53 54 55 56 217 209 179

Corp 62 62 62 62 248 214 188

Total 215 215 216 219 865 797 697

Sight & savings 6 4 0 0 10 11 50

Time -57 -53 -43 -36 -189 -68 0

Total -51 -49 -43 -36 -179 -57 50

Total NII from L&D 164 166 173 182 686 740 747

Other NII -2 7 3 3 11 0 0

Total NII 162 173 176 185 697 740 747

NIM (%) 2.17% 2.35% 2.38% 2.49% 2.33% 2.47% 2.46%



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UniCredit Research page 30

Notes


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Notes


32/36


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Key 3: UniCredit Bank AG, UniCredit Bank AG London Branch, UniCredit CAIB AG, UniCredit Bank AG Milan Branch, UniCredit CAIB Securities UK Ltd., UniCredit Securities,UniCredit Menkul Deerler A.., Zagrebaka banka and UniCredit Bulbank and/or a company affiliated (pursuant to relevant domestic law) administers the securities issued bythe analyzed company on the stock exchange or on the market by quoting bid and ask prices (i.e. acts as a market maker or liquidity provider in the securities of the analyzedcompany or in any related derivatives).

Key 4: The analyzed company and UniCredit Bank AG, UniCredit Bank AG London Branch, UniCredit CAIB AG, UniCredit Bank AG Milan Branch, UniCredit CAIB Securities UK Ltd.,UniCredit Securities, UniCredit Menkul Deerler A.., Zagrebaka banka and UniCredit Bulbank and/or a company affiliated (pursuant to relevant domestic law) concluded anagreement on services in connection with investment banking transactions in the last 12 months, in return for which the Bank received a consideration or promise of consideration.

Key 5: The analyzed company and UniCredit Bank AG, UniCredit Bank AG London Branch, UniCredit CAIB AG, UniCredit Bank AG Milan Branch, UniCredit CAIB Securities UK Ltd.,UniCredit Securities, UniCredit Menkul Deerler A.., Zagrebaka banka and UniCredit Bulbank and/or a company affiliated (pursuant to relevant domestic law) have concludedan agreement on the preparation of analyses.

Key 6a: Employees of UniCredit Bank AG Milan Branch and/or members of the Board of Directors of UniCredit (pursuant to relevant domestic law) are members of the Board ofDirectors of the Issuer. Members of the Board of Directors of the Issuer hold office in the Board of Directors of UniCredit (pursuant to relevant domestic law).

Key 6b: The analyst is on the supervisory/management board of the company they cover.

Key 7: UniCredit Bank AG Milan Branch and/or other Italian banks belonging to the UniCredit Group (pursuant to relevant domestic law) extended significant amounts of creditfacilities to the Issuer.

RECOMMENDATIONS, RATINGS AND EVALUATION METHODOLOGYCompany Date Rating Currency Target price

Alpha Bank 19/10/2009 HOLD EUR 12.00Alpha Bank 13/10/2009 HOLD EUR 13.00Alpha Bank 18/08/2009 SELL EUR 8.80EFG EUROBANK ERGASIAS 18/08/2009 SELL EUR 8.00

National Bank of Greece 12/11/2009 HOLD EUR 23.00National Bank of Greece 18/08/2009 HOLD EUR 20.50Piraeus Bank 18/08/2009 SELL EUR 7.40

Overview of our ratings

You will find the history of rating regarding recommendation changes as well as an overview of the breakdown in absolute and relative terms of our investment ratings on ourwebsites www.research.unicredigroup.eu and www.cib-unicredit.com/research-disclaimer under the heading Disclaimer.

Note on what the evaluation of equities is based:

We currently use a three-tier recommendation system for the stocks in our formal coverage: Buy, Hold, or Sell (see definitions below):

A Buy is applied when the expected total return over the next twelve months is higher than the stock's cost of equity.A Hold is applied when the expected total return over the next twelve months is lower than i ts cost of equity but higher than zero.A Sell is applied when the stock's expected total return over the next twelve months is negative.

We employ three further categorizations for stocks in our coverage:

Restricted: A rating and/or financial forecasts and/or target price is not disclosed owing to compliance or other regulatory considerations such as blackout period or conflict of interest.Coverage in transition: Due to changes in the research team, the disclosure of a stock's rating and/or target price and/or financial information are temporarily suspended. Thestock remains in the research universe and disclosures of relevant information will be resumed in due course.Not rated: Suspension of coverage.

Company valuations are based on the following valuation methods: Multiple-based models (P/E, P/cash flow, EV/sales, EV/EBIT, EV/EBITA, EV/EBITDA), peer-groupcomparisons, historical valuation approaches, discount models (DCF, DVMA, DDM), break-up value approaches or asset-based evaluation methods. Furthermore,recommendations are also based on the Economic profit approach. Valuation models are dependent on macroeconomic factors, such as interest rates, exchange rates, rawmaterials, and on assumptions about the economy. Furthermore, market sentiment affects the valuation of companies. The valuation is also based on expectations that mightchange rapidly and without notice, depending on developments specific to individual industries. Our recommendations and target prices derived from the models might thereforechange accordingly. The investment ratings generally relate to a 12-month horizon. They are, however, also subject to market conditions and can only represent a snapshot. Theratings may in fact be achieved more quickly or slowly than expected, or need to be revised upward or downward.

Note on the bases of evaluation for interest-bearing securities:

Our investment ratings are in principle judgments relative to an index as a benchmark.

Issuer level:

Marketweight: We recommend having the same portfolio exposure in the name as the respective reference index (the iBoxx index universe for high-grade names and the MLEUR HY index for sub-investment grade names).Overweight: We recommend having a higher portfolio exposure in the name as the respective reference index (the iBoxx index universe for high-grade names and the ML EURHY index for sub-investment grade names).Underweight: We recommend having a lower portfolio exposure in the name as the respective reference index (the iBoxx index universe for high-grade names and the ML EURHY index for sub-investment grade names).

Instrument level:

Core hold: We recommend holding the respective instrument for investors who already have exposure.Sell: We recommend selling the respective instrument for investors who already have exposure.Buy: We recommend buying the respective instrument for investors who already have exposure.

Trading recommendations for fixed-interest securities mostly focus on the credit spread (yield difference between the fixed-interest security and the relevant government bond orswap rate) and on the rating views and methodologies of recognized agencies (S&P, Moodys, Fitch). Depending on the type of investor, investment ratings may refer to a shortperiod or to a 6 to 9-month horizon. Please note that the provision of securities services may be subject to restrictions in certain jurisdictions. You are required to acquaintyourself with local laws and restrictions on the usage and the availability of any services described herein. The information is not intended for distribution to or use by any personor entity in any jurisdiction where such distribution would be contrary to the applicable law or provisions.

The prices used in the analysis are the closing prices of the appropriate local trading system or the closing prices on the relevant local stock exchanges. In the case of unlistedstocks, the average market prices based on various major broker sources (OTC market) are used.

The MSCI sourced information is the exclusive property of Morgan Stanley Capital International Inc. (MSCI). Without prior written permission of MSCI, this information and anyother MSCI intellectual property may not be reproduced, redisseminated or used to create any financial products, including any indices. This information is provided on an as isbasis. The user assumes the entire risk of any use made of this information. MSCI, its affiliates and any third party involved in, or related to, computing or compiling theinformation hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability or fitness for a particular purpose with respect to any of thisinformation. Without limiting any of the foregoing, in no event shall MSCI, any of its affiliates or any third party involved in, or related to, computing or compiling the informationhave any liability for any damages of any kind. MSCI, Morgan Stanley Capital International and the MSCI indexes are services marks of MSCI and its affiliates.

The Global Industry Classification Standard (GICS) was developed by and is the exclusive property of Morgan Stanley Capital International Inc. and Standard & Poors. GICS is aservice mark of MSCI and S&P and has been licensed for use by UniCredit CAIB Group.

Coverage PolicyA list of the companies covered by UniCredit Bank AG, UniCredit Bank AG London Branch, UniCredit CAIB AG, UniCredit CAIB Securities UK Ltd., UniCredit Bank AG MilanBranch, UniCredit Securities, UniCredit Menkul Deerler A.., Zagrebaka banka and UniCredit Bulbank is available upon request.


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Frequency of reports and updates

It is intended that each of these companies be covered at least once a year, in the event of key operations and/or changes in the recommendation. Companies for whichUniCredit Bank AG Milan Branch acts as Sponsor or Specialist must be covered in accordance with the regulations of the competent market authority.

SIGNIFICANT FINANCIAL INTEREST:

UniCredit Bank AG, UniCredit Bank AG London Branch, UniCredit CAIB AG, UniCredit Bank AG Milan Branch, UniCredit CAIB Securities UK Ltd., UniCredit Securities, UniCreditMenkul Deerler A.., Zagrebaka banka and UniCredit Bulbank and/or a company affiliated (pursuant to relevant national German, Italian, Austrian, UK, Russian and Turkishlaw) with them regularly trade shares of the analyzed company. UniCredit Bank AG, UniCredit Bank AG London Branch, UniCredit CAIB AG, UniCredit Bank AG Milan Branch,UniCredit CAIB Securities UK Ltd., UniCredit, UniCredit Menkul Deerler A.., Zagrebaka banka and UniCredit Bulbank may hold significant open derivative positions on thestocks of the company which are not delta-neutral.Analyses may refer to one or several companies and to the securities issued by them. In some cases, the analyzed issuers have actively supplied information for this analysis.

ANALYST DECLARATION

The authors remuneration has not been, and will not be, geared to the recommendations or views expressed in this study, neither directly nor indirectly.

ORGANIZATIONAL AND ADMINISTRATIVE ARRANGEMENTS TO AVOID AND PREVENT CONFLICTS OF INTEREST

To prevent or remedy conflicts of interest, UniCredit Bank AG, UniCredit Bank AG London Branch, UniCredit CAIB AG, UniCredit CAIB Securities UK Ltd., UniCredit Bank AG MilanBranch, UniCredit Securities, UniCredit Menkul Deerler A.., Zagrebaka banka and UniCredit Bulbank have established the organizational arrangements required from a legaland supervisory aspect, adherence to which is monitored by its compliance department. Conflicts of interest arising are managed by legal and physical and non-physical barriers(collectively referred to as Chinese Walls) designed to restrict the flow of information between one area/department of UniCredit Bank AG, UniCredit Bank AG London Branch,UniCredit CAIB AG, UniCredit CAIB Securities UK Ltd., UniCredit Bank AG Milan Branch, UniCredit Securities, UniCredit Menkul Deerler A.., Zagrebaka banka and UniCreditBulbank and another. In particular, Investment Banking units, including corporate finance, capital market activities, financial advisory and other capital raising activities, aresegregated by physical and non-physical boundaries from Markets Units, as well as the research department. In the case of equities execution by UniCredit Bank AG MilanBranch, other than as a matter of client facilitation or delta hedging of OTC and listed derivative positions, there is no proprietary trading. Disclosure of publicly available conflictsof interest and other material interests is made in the research. Analysts are supervised and managed on a day-to-day basis by line managers who do not have responsibility forInvestment Banking activities, including corporate finance activities, or other activities other than the sale of securities to clients.

ADDITIONAL REQUIRED DISCLOSURES UNDER THE LAWS AND REGULATIONS OF JURISDICTIONS INDICATED

Notice to Austrian investorsThis document does not constitute or form part of any offer for sale or subscription of or solicitation of any offer to buy or subscribe for any securities and neither this documentnor any part of it shall form the basis of, or be relied on in connection with or act as an inducement to enter into, any contract or commitment whatsoever.This document is confidential and is being supplied to you solely for your information and may not be reproduced, redistributed or passed on to any other person or published, inwhole or part, for any purpose.

Notice to Czech investorsThis report is intended for clients of UniCredit Bank AG, UniCredit Bank AG London Branch, UniCredit CAIB AG, UniCredit CAIB Securities UK Ltd., UniCredit Bank AG Milan Branch,UniCredit Securities, UniCredit Menkul Deerler A.., Zagrebaka banka and UniCredit Bulbank in the Czech Republic and may not be used or relied upon by any other personfor any purpose.

Notice to Italian investorsThis document is not for distribution to retail clients as defined in article 26, paragraph 1(e) of Regulation n. 16190 approved by CONSOB on 29 October 2007.In the case of a short note, we invite the investors to read the related company report that can be found on UniCredit Research website www.research.unicreditgroup.eu.

Notice to Russian investorsAs far as we are aware, not all of the financial instruments referred to in this analysis have been registered under the federal law of the Russian Federation On the SecuritiesMarket dated April 22, 1996, as amended, and are not being offered, sold, delivered or advertised in the Russian Federation.

Notice to Turkish investorsInvestment information, comments and recommendations stated herein are not within the scope of investment advisory activities. Investment advisory services are provided inaccordance with a contract of engagement on investment advisory services concluded with brokerage houses, portfolio management companies, non-deposit banks and theclients. Comments and recommendations stated herein rely on the individual opinions of the ones providing these comments and recommendations. These opinions may not suityour financial status, risk and return preferences. For this reason, to make an investment decision by relying solely on the information stated here may not result in consequencesthat meet your expectations.

Notice to Investors in JapanThis document does not constitute or form part of any offer for sale or subscription for or solicitation of any offer to buy or subscribe for any securities and neither this documentnor any part of it shall form the basis of, or be relied on in connection with or act as an inducement to enter into, any contract or commitment whatsoever.

Notice to UK investorsThis communication is directed only at clients of UniCredit Bank AG, UniCredit Bank AG London Branch, UniCredit CAIB AG, UniCredit CAIB Securities UK Ltd., UniCredit Bank AGMilan Branch, UniCredit Securities, UniCredit Menkul Deerler A.., Zagrebaka banka or UniCredit Bulbank who (i) have professional experience in matters relating toinvestments or (ii) are persons falling within Article 49(2)(a) to (d) (high net worth companies, unincorporated associations, etc.) of the United Kingdom Financial Services andMarkets Act 2000 (Financial Promotion) Order 2005 or (iii) to whom it may otherwise lawfully be communicated (all such persons together being referred to as relevantpersons). This communication must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this communicationrelates is available only to relevant persons and will be engaged in only with relevant persons.

Notice to U.S. investorsThis report is being furnished to U.S. recipients in reliance on Rule 15a-6 ("Rule 15a-6") under the U.S. Securities Exchange Act of 1934, as amended. Each U.S. recipient of thisreport represents and agrees, by virtue of its acceptance thereof, that it is such a "major U.S. institutional investor" (as such term is defined in Rule 15a-6) and that it understands

the risks involved in executing transactions in such securities. Any U.S. recipient of this report that wishes to discuss or receive additional information regarding any security orissuer mentioned herein, or engage in any transaction to purchase or sell or solicit or offer the purchase or sale of such securities, should contact a registered representative ofUniCredit Capital Markets, Inc. (UCI Capital Markets).Any transaction by U.S. persons (other than a registered U.S. broker-dealer or bank acting in a broker-dealer capacity) must be effected with or through UCI Capital Markets.The securities referred to in this report may not be registered under the U.S. Securities Act of 1933, as amended, and the issuer of such securities may not be subject to U.S.reporting and/or other requirements. Available information regarding the issuers of such securities may be limited, and such issuers may not be subject to the same auditing andreporting standards as U.S. issuers.The information contained in this report is intended solely for certain "major U.S. institutional investors" and may not be used or relied upon by any other person for any purpose.Such information is provided for informational purposes only and does not constitute a solicitation to buy or an offer to sell any securities under the Securities Act of 1933, asamended, or under any other U.S. federal or state securities laws, rules or regulations. The investment opportunities discussed in this report may be unsuitable for certaininvestors depending on their specific investment objectives, risk tolerance and financial position. In jurisdictions where UCI Capital Markets is not registered or licensed to trade insecurities, commodities or other financial products, transactions may be executed only in accordance with applicable law and legislation, which may vary from jurisdiction to

jurisdiction and which may require that a transaction be made in accordance with applicable exemptions from registration or licensing requirements.The information in this publication is based on carefully selected sources believed to be reliable, but UCI Capital Markets does not make any representation with respect to itscompleteness or accuracy. All opinions expressed herein reflect the authors judgment at the original time of publication, without regard to the date on which you may receivesuch information, and are subject to change without notice.UCI Capital Markets may have issued other reports that are inconsistent with, and reach different conclusions from, the information presented in this report. These publicationsreflect the different assumptions, views and analytical methods of the analysts who prepared them. Past performance should not be taken as an indication or guarantee of futureperformance, and no representation or warranty, express or implied, is provided in relation to future performance.UCI Capital Markets and any company affiliated with it may, with respect to any securities discussed herein: (a) take a long or short position and buy or sell such securities; (b) act asinvestment and/or commercial bankers for issuers of such securities; (c) act as market makers for such securities; (d) serve on the board of any issuer of such securities; and (e) act aspaid consultant or advisor to any issuer.


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Greek Banks


The information contained herein may include forward-looking statements within the meaning of U.S. federal securities laws that are subject to risks and uncertainties. Factorsthat could cause a companys actual results and financial condition to differ from expectations include, without limitation: political uncertainty, changes in general economicconditions that adversely affect the level of demand for the companys products or services, changes in foreign exchange markets, changes in international and domesticfinancial markets and in the competitive environment, and other factors relating to the foregoing. All forward-looking statements contained in this report are qualified in theirentirety by this cautionary statement.

This document may not be distributed in Canada or Australia.


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Greek Banks

UniCredit Research*Thorsten Weinelt, CFAGlobal Head of Research & Chief Strategist

+49 89 [email protected]

Dr. Ingo HeimigHead of Research Operations

+49 89 [email protected]

Equity Research

Mark Robinson, Head+44 20 7826-7960, [email protected]

EUROPEAN SECTOR ANALYSTS

Aerospace & Defence/Airlines/Industrials

Uwe Weinreich+49 89 378-12640Gabriele Parini+39 02 8862-8587

Automobiles & Parts

Georg Strzer+49 89 378-18252Christian Aust, CFA+49 89 378-11394

Gabriele Parini+39 02 8862-8587

Banks

Stefan-M. Stalmann+44 207 826-7703Eugenio M. Cicconetti+44 207 826-7972Tania Gold+44 20 7826-7946James Invine+44 20 7826-7975Gyorgy Olah+44 20 7826-7968

Marketing AnalystJoseph Champion+44 20 7826-7887

Capital Goods

Alessandro Falcioni+39 02 8862-2242Peter Bauernfried

+43 5 05 05-82368Katherina Kastenberger+43 5 05 05-82367Peter Rothenaicher+49 89 378-18718Antonio Vizzari+39 02 8862-2597Harald Weghofer+43 5 05 05-82355

Chemicals & Health Care

Andreas Heine+49 89 378-16921Markus Mayer+49 89 378-18670Dr. Silke Stegemann+49 89 378-17101

Construction & Materials

Peter Bauernfried+43 5 05 05-82368Maurizio Moretti+39 02 8862-2715Kerstin Vitvar+49 89 378-11392

Consumer/HPC

Nicolas Sochovksy+44 20 7826-7885Christian Weiz+49 89 378-15229

Marketing AnalystRupert Trotter+44 20 7826-7890

Fashion & Luxury Goods

Davide Vimercati+39 02 8862-2456

Volker Bosse+49 89 378-11398

Insurance/Financial Services

Dr. Andreas Weese+49 89 378-12561Enrico Mattioli+39 02 8862-8108Bernd Mller-Gerberding, CFA+49 89 378-18706

Marketing AnalystJoseph Champion+44 20 7826-7887

Media

Maurizio Moretti+39 02 8862-2715Friedrich Schellmoser+49 89 378-11396

Metals & Mining

Christian Obst

+49 89 378-15117Alexander Hodosi+43 5 05 05-82359

Mid & Small Cap

Roberto Odierna+39 02 8862-8912Pierluigi Amoruso+39 02 8862-2007Peter Bauernfried+43 5 05 05-82368Alessandro Falcioni+39 02 8862-2242Katharina Kastenberger+43 5 05 05-82367Maurizio Moretti+39 02 8862-2715Peter Rothenaicher+49 89 378-18718Friedrich Schellmoser+49 89 378-11396

Antonio Vizzari+39 02 8862-2597Harald Weghofer+43 5 05 05-82355

Oil & Gas

Sergio Molisani+39 02 8862-2339Stefano Vitali+39 02 8862-2003

Real Estate

Andre Remke, CFA+49 89 378-18202Pierluigi Amoruso+39 02 8862-8586Alexander Hodosi

+43 5 05 05-82359Renewables

Michael Tappeiner+49 89 378-14163Friedrich Schellmoser+49 89 378-11396Kerstin Vitvar+49 89 378-11392

Retailers (Food)

Volker Bosse+49 89 378-11398

Semiconductors/Telecom Equipment/Technology Hardware

Guenther Hollfelder, CFA+49 89 378-18776Software & IT Services

Knut Woller+49 89 378-11381

Telecommunications

Thomas Friedrich, CFA+49 89 378-12798Giovanni D'Amico+39 02 8862-2007Harald Weghofer+43 5 05 05-82355

Tourism, Leisure & Services

Christian Obst+49 89 378-15117Jonathan Schroer, CFA+49 89 378-12416

Utilities

Lueder Schumacher+44 20 7826-7967Vincent Ayral+44 207 826-7891Roberto Larotonda+39 02 8862-2383Javier Suarez

+39 02 8862-8183Marketing AnalystJenny Ping+44 207 826-7966

REGIONAL RESEARCH

AustriaPeter Bauernfried, Head+43 5 05 05-82368Alexander Hodosi+43 5 05 05-82359Katharina Kastenberger+43 5 05 05-82367Harald Weghofer+43 5 05 05-82355

ItalyRoberto Odierna, Head+39 02 8862-8912Pierluigi Amoruso+39 02 8862-8586Giovanni D'Amico+39 02 8862-2007Alessandro Falcioni+39 02 8862-2242Roberto Larotonda+39 02 8862-2383Enrico Mattioli+39 02 8862-8108Sergio Molisani+39 02 8862-2339Maurizio Moretti+39 02 8862-2715Gabriele Parini+39 02 8862-8587Javier Suarez+39 02 8862-8183

Davide Vimercati+39 02 8862-2456Stefano Vitali+39 02 8862-2003Antonio Vizzari+39 02 8862-2597

GermanyAndreas Heine, Co-Head+49 89 378-16921Georg Strzer, Co-Head+49 89 378-18252Christian Aust, CFA+49 89 378-11394Volker Bosse+49 89 378-11398Thomas Friedrich, CFA+49 89 378-12798Guenther Hollfelder, CFA+49 89 378-18776

Markus Mayer+49 89 378-18670Bernd Mller-Gerberding, CFA+49 89 378-18706Christian Obst+49 89 378-15117

Andre Remke, CFA+49 89 378-18202Peter Rothenaicher+49 89 378-18718Friedrich Schellmoser+49 89 378-11396Jonathan Schroer, CFA+49 89 378-12416Dr. Silke Stegemann+49 89 378-17101Michael Tappeiner+49 89 378-14163Kerstin Vitvar+49 89 378-11392Dr. Andreas Weese+49 89 378-12561Uwe Weinreich+49 89 378-12640Christian Weiz+49 89 378-15229Knut Woller+49 89 378-11381

ESG Research

Patrick Berger, CFA+44 20 7826-7952

Equity Strategy

Gerhard Schwarz, Head+49 89 378-12421Volker Bien

+49 89 378-18148Dr. Tammo Greetfeld+49 89 378-18361Christian Stocker+49 89 378-18603

Research MarketingStephanie Ruehl+44 207 826-7957

EQUITY SALES

Equity Sales London+44 207 826-6949

Equity Sales Milan+39 02 8862-0643

Equity Sales Munich+49 89 378-14129

Equity Sales New York

+1 212 672-6140Equity Sales Vienna+43 5 05 05-82976

Equity Derivates+44 207 826-6444

Publication Address

UniCredit ResearchMoor House120 London WallLondon, EC2Y 5ETUnited Kingdom

BloombergUCGR

Internetwww.research.unicreditgroup.eu

*UniCredit Research is the joint research department of UniCredit Bank AG (UniCredit Bank), UniCredit CAIB Group (UniCredit CAIB), UniCredit Securities (UniCredit Securities),UniCredit Menkul Deerler A.. (UniCredit Menkul), Zagrebaka banka and UniCredit Bulbank.

greek banks update jan 2010

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