This excerpt taken from the NBG 6-K filed Nov 30, 2006.
Strong core income leads profitability to historic highs
The improvement in the Groups core income reflects consistent growth in interest income as well as commission income. The Groups net interest income for the 9-month period amounted to 1,365 million, up 17% y-o-y. This increase reflects an improvement in the asset mix via the continued expansion of the retail loan book, which now represents over 63% of the total loan book.
The dynamic improvement in interest income is reflected also in the 4% growth posted from Q2 to Q3 2006, leading net interest income in Q3 to a record high of 478 million. Despite the upward climb of ECB interest rates, the Groups sound asset structure contributed to a further improvement in net interest margin to 3.50% in Q3 2006 from 3.16% in 2005.
In the first 9 months of 2006, net commission income rose to 350 million. While intense and generalized competition caused retail commissions to remain unchanged, other sources of fees and commissions offset the drag, pushing up overall commission income by 15% y-o-y.
Income from the insurance business also improved, rising to 80 million compared with 74 million during the same nine months of 2005, up 8%. If the requirement for the formation of extraordinary insurance reserves of 13 million during the year is not taken into account, the rate rises to 26% on a comparable basis relative to Q3 2005. This positive development reflects the ongoing restructuring in the Groups
operations and the growing contribution of the life and group insurance segments due to the promotion of new Bancassurance products to NBGs broad customer base. Indeed, it is notable that for the first time in the history of the business, the production of life insurance premiums in 9-month 2006 exceeded the corresponding production of the general insurance segments.