Athens, Greece. Morgan Stanley expects the Greek banking sector to enter the earnings season with higher profit forecasts, robust credit growth and potential second-quarter upside surprises. The US investment bank said it remains constructive on the sector, citing supportive macroeconomic conditions and attractive valuations.
Preferred stocks and target prices
Morgan Stanley named Piraeus Bank and Eurobank as its preferred stocks ahead of results, saying they have the greatest scope to exceed market expectations and raise full-year guidance.
The bank set target prices of €11.30 for Piraeus Bank, €4.90 for Eurobank, €4.90 for Alpha Bank, €17.20 for the National Bank of Greece and €1.16 for CrediaBank.
It maintained Overweight ratings on Piraeus Bank, Eurobank and Alpha Bank. The National Bank of Greece and CrediaBank were assigned Equal-weight ratings.
Credit growth and funding
Morgan Stanley said credit expansion remains strong, with new loan production in April and May about 40 per cent higher than in the previous quarter and 16 per cent above the same period a year earlier. Business lending was the main driver.
Loan balances are increasing at an annual rate of 7.4 per cent, according to the report. Term deposits account for 23 per cent of total deposits, raising funding costs but not materially changing the overall outlook for the sector.
Piraeus Bank outlook
For Piraeus Bank, Morgan Stanley forecasts second-quarter net profit of €324 million, about 7 per cent above market consensus.
The investment bank expects net interest income and fees to support stronger operating profitability. It sees potential for 2026 net interest income guidance to rise by about 5 per cent and for a significant upgrade to fee targets through 2028.
Morgan Stanley increased its earnings-per-share forecasts for Piraeus Bank for the 2026-2028 period.