This excerpt taken from the NBG 6-K filed Mar 1, 2006.
18% growth in loans, spearheaded by mortgages
At 31 December 2005, total Group lending stood at 30.6 billion, up 18.4% y-o-y. Retail loans are providing the driving force behind this growth. To illustrate, at 31 December, retail loans outstanding amounted to 18.6 billion, up 26% y-o-y, as a result of which retail loans now represent over 61% of the total loan book.
Mortgages posted spectacular growth of 31%, leading mortgages outstanding at the end of 2005 to over 11.8 billion, or 38.6% of total Group lending. Mortgage disbursements topped a record 3.5 billion in 2005, up 34% y-o-y. In the second half of the year, the Bank implemented a far-reaching sales programme aimed at tapping the surge in demand for housing loans. Thus, in 2005, NBGs market share of new mortgages rose sharply to 26%. The sustained strong demand for mortgage packages in the first month of 2006 suggests that growth will continue in the year ahead.
At 31 December 2005, consumer loans outstanding stood at 3.2 billion, up 23.7%. The revolving credit facility product was a key component in this performance, as it posted annual growth of 35% and contributed decisively to commissions generated by consumer credit, which grew by 80% y-o-y. Moreover, credit cards outstanding grew by 6.3% to 1.5 billion.
This growth in credit card and consumer lending is especially encouraging in view of the credit discipline that the Group has been applying as a strategic policy in this loan segment. The level of discipline is reflected by the high level of rejections, ranging from 39% to 47%, depending on the type of loan.
Loans to small businesses with turnover below 2.5 million also posted satisfactory growth of around 20%, with loans outstanding totalling 2 billion at 31 December 2005. The Bank is also making strong progress in its efforts to broaden lending to medium-sized businesses
(with annual turnover of 2.5 to 50 million), as loans in this segment grew to over 3.2 billion, up 13%.
Non-performing loans declined to 4.7% of the aggregate loan book, compared with 5.3% at the end of 2004. After provisions for bad and doubtful debt, net non-performing loans today account for just 1.1% of the total loan book. The healthy growth in lending in recent years has been made possible by the application of state-of-the-art controls and credit risk management throughout the Group.