“The Greek economy sustained its growth momentum in 2023, with an estimated GDP increase of around 2.5%, significantly exceeding the Eurozone average. The main drivers of the expansion are the execution of the Recovery and Resilience Fund (RRF), a recovering labor market and an influx of foreign investments to Greece. In 2023, the Greek sovereign regained its investment grade status, signifying another milestone for the country and the banking sector, while the potential upgrade of Greece to developed market status will be another catalyst towards the convergence with our EU counterparts.
Piraeus Group delivered its strongest ever set of financial results in Q4, generating €0.25 normalized earnings per share and 20% RoTBV, bringing the 2023 annual figures to €0.80 and 17% respectively. Piraeus Group continued improving all key financial indicators, focusing on sustainable risk-adjusted profitability and capital accumulation, through diversified revenue sources and cost discipline, while maintaining prudent credit risk management. Our strategy to boost fees is working, as we increased net fee income to a market leading 74bps over assets in full year 2023, while our pursuit of further operational efficiency, has driven our cost-to-core income ratio to 31%, the lowest ever on a yearly basis.
The accelerated organic capital generation has driven our CET1 ratio to 13.3%, up by 1.7 percentage points year on year. We achieved this while at the same time accruing for planned shareholder distribution and bringing down our non performing exposure ratio to 3.5%. Our Group’s performing loan portfolio grew 5% year on year, leveraging on the Group’s market leading position in RRF programs take-up.
Capitalizing on 2023 performance, Piraeus Group, today, announces its new financial targets for 2024-26. The key elements comprise net recurring profitability of approximately €1bn per year for 2024-26, further growth of CET1 ratio to approximately 15% in 2026, expansion of performing loans by at least 5% per year, and non performing exposures ratio of approximately 2.5% in 2026. Also, marking the transition to a different era for the Group, we now aim at a distribution ratio of 50% out of 2025 onwards, subject to the necessary conditions being met.
We continue to raise our aspirations and focus on creating value for our shareholders, as we ensure Piraeus continues supporting its customers and the broader Greek economy.”