Greece's Alpha Bank plans to sharply reduce its reliance on deferred tax credits over the next four years, seeking to strengthen the quality of its regulatory capital while improving profitability and expanding shareholder returns.
Under its 2026-2030 strategic plan, the lender aims to cut deferred tax credits, or DTCs, from approximately 40% of its core Tier 1 capital in 2026 to 19% in 2028 and below 5% by 2030. The planned reduction marks a significant shift in the bank's capital structure and reflects broader efforts by Greek lenders to move beyond the legacy of the country's sovereign-debt crisis.
Deferred tax credits became an important component of Greek banks' regulatory capital following years of heavy losses and restructuring. Although recognized under applicable capital rules, their substantial presence has raised questions about the composition and quality of banks' capital buffers. Chief Executive Vassilios Psaltis outlined the targets during Alpha Bank's investor presentation.
ΔΙΑΒΑΣΤΕ ΕΠΙΣΗΣ
The bank expects to maintain its common equity Tier 1 capital ratio near 13% in 2030, compared with approximately 14% in 2026, while financing loan growth and shareholder distributions.
Alpha Bank also expects the negative impact of deferred tax assets on its return on tangible equity to narrow from approximately seven percentage points to three by 2030.
Its return on tangible equity is projected to reach 16%, up from 11.4% in 2025, while returns on core regulatory capital are expected to approach 24%.
Management estimates that accelerated DTC amortization could generate approximately €200 million in regulatory capital benefits for every €1 billion in profits.
The bank also forecasts an increase in its net interest margin to 2.47% by 2030 from 2.23% in 2026, supported partly by a shift toward income-generating assets.
The restructuring forms part of Alpha Bank's broader strategy to improve capital efficiency and support more than €4 billion in potential shareholder distributions or capital deployment between 2027 and 2030.
