Erste Group: Strong operating performance, strategic progress in Poland

Erste Group: Strong operating performance, strategic progress in Poland

• Loan volume increased to €282.7 billion in H1 2026, nearly reaching full-year target of €285 billion
• New full-year lending target set at around €290 billion
• Deposit volume rose to €323.7 billion in H1 2026
• Assets under Management up ca. 8% YTD and close to €112 billion (excl. Poland)
• CEE markets remain key profit drivers, with two-thirds of overall net profit
• Capitalisation strong, with CET1 ratio at 15.2%
• Good progress in integration of Erste Bank Polska

In the first six months of 2026, Erste Group Bank AG (“Erste Group”) further strengthened its strategic positioning as Central Europe’s leading financial services provider and improved all its key metrics. The consolidation of Erste Group’s newly acquired Polish bank significantly boosted the banking group’s results in the first half of the year. Even when the impact of this consolidation is excluded, the Group’s figures demonstrate that its organic growth momentum remains strong and intact.

“The strong growth in our lending portfolio these past six months has already placed us near our full-year lending target of 285 billion euros. That’s why we’re now raising that target to 290 billion euros. Our position as the region’s undisputed leading lender is based on this ambition, as well as our unrivalled presence in Central Europe through fully fledged banks in eight countries,” said Peter Bosek, CEO of Erste Group. “Sustaining the region’s growth momentum will require significant investment in future-proof infrastructure across Central Europe. We stand ready to support both businesses and governments and to play our part in driving the region’s continued development and prosperity.”

Core revenues benefit from strong customer business in resilient economies

The organic growth and the resilience of the region’s economies despite the volatility introduced by global geopolitical developments contributed to a 4.0% year-to-date rise in customer loan volumes on a comparable basis (excl. Poland). That growth was apparent across almost all markets, with customer demand for financing particularly strong in the Czech Republic, Hungary, Croatia and Austria. Including Erste Bank Polska’s loan portfolio of 41.4 billion euros, loans increased by 21.9%, with the overall volume reaching 282.7 billion euros (Dec. 2025: 232.0 billion euros). Erste Group subsidiaries excluding Poland concluded 60,000 new mortgage loans, helping to drive higher overall lending in the retail segment, while a net increase of over 4 billion euros in lending in the corporate segment reflected stronger demand for loans for investment.

Customer deposits on a comparable basis (excl. Poland) rose by 4.5% during the first half of the year, with growth within Erste Group’s long-established markets driven mainly by higher deposit volumes in the corporates segment in the Czech Republic and Austria, as well as by a positive foreign currency impact on deposits in Hungary. When including the 59.3 billion euros in customer deposits at Erste Bank Polska, the Group’s overall deposit volume grew by 27.9% to 323.7 billion euros (Dec. 2025: 253.0 billion euros).

Against the backdrop of adjustments in the interest rate environment both in the euro area and beyond, this growth in customer business helped lift core revenues. Without Erste Bank Polska, the net interest income (NII) grew by 6.1%. Including the new Polish entity, NII was 42.3% higher year-on-year at 5.4 billion euros (H1 2025: 3.8 billion euros).

Net fee and commission income (NFCI) rose by 8.8% on a comparable basis, while including Poland led it to rise by 25.1% to 1.9 billion euros (H1 2025: 1.5 billion euros). Beyond the impact of the inclusion of Erste Bank Polska, this increase in NFCI also reflected positive developments in the securities business. Assets under management (AuM) managed by Erste Asset Management were 7.6% higher since December 2025 at almost 112 billion euros. This total does not include around 7.7 billion euros in AuM at the Polish asset manager Erste TFI. Growing customer interest in investments was also apparent in the strong demand for monthly investment plans, which rose 21.4% year-on-year to 2.2 million in total.

These positive developments in core revenues led to a strong 8.3% year-on-year increase in operating income on a comparable basis. Including the contribution from Erste Bank Polska led to a 40.4% increase in overall operating income to almost 8.0 billion euros (H1 2025: 5.7 billion euros).

Operating expenses increased by 3.4% on a comparable basis, in line with guidance and reflecting higher personnel expenses and FX effects. With Erste Bank Polska included, operating expenses amounted to 3.5 billion euros (H1 2025: 2.7 billion euros), an increase of 30.7%. Accordingly, the operating result rose by 12.7% on a comparable basis. Including Poland led the operating result to rise by 49.3% to 4.4 billion euros (H1 2025: 3.0 billion euros). Erste Group’s cost/income ratio stood at 45.6% on a comparable basis or 44.4% with Poland included (H1 2025: 47.7%).

Robust capitalization reflects strong operating performance

In the first half of 2026, risk costs increased to 583 million euros, due to expected one-off effects related to the first-time consolidation of Erste Bank Polska in the first quarter. These one-off effects, recognised in accordance with IFRS 9, amounted to 302 million euros. A further booking of 60 million euros was related to Erste Bank Polska’s existing loan portfolio. Despite volatile markets and geopolitical uncertainties, the risk costs booked for Erste Group’s long-established markets remained at a consistently low level of 221 million euros (H1 2025: 182 million euros). The quality of the loan portfolio remained robust, leading the NPL ratio to remain largely unchanged at a low level of 2.3% (Dec. 25: 2.4%).

The burden from banking levies nearly doubled in the first half of 2026 to 392 million euros (H1 2025: 197 million euros). This increase was driven by higher charges in Hungary (up from 109 to 189 million euros) and Romania (up from 20 to 39 million euros), as well as by the first-time recognition of banking taxes in Poland (98 million euros). In addition to these banking levies, the Group booked banking taxes of 33 million euros in Slovakia (H1 2025: 32 million euros) as taxes on income.

Erste Group’s net profit rose by 7.6% on a comparable basis. The increase was 18.6% including Erste Bank Polska and one-off effects, reaching 2.0 billion euros (H1 2025: 1.7 billion euros). Despite the effects associated with the first-time consolidation of the Polish subsidiary, Central Europe continued to clearly be the profits driver for the Group, accounting for two-thirds of its total net profit.

The strong development in the Group’s core business boosted its capitalization, with the common equity tier 1 capital ratio (CET1) coming in at 15.2% (Dec. 25: 19.3%).

“Consolidating our new Polish subsidiary provided an obvious boost to our reported numbers. But we’ve also posted strong growth in our core business in the markets in which we have a long-established presence,” said Erste Group CFO Stefan Dörfler. “Our consistent delivery of solid results allows us to continue investing in our platform to make us more efficient, faster and more scalable across the group. That enables us to serve our 23 million customers and Erste Group’s investors in the best possible way.”

Erste in Poland: Brand-building on track, loyalty remains high

Erste Group’s acquisition of a controlling 49% stake in Erste Bank Polska was successfully completed in January 2026. Since then, the integration of the Polish subsidiary into Erste Group has progressed according to plan. Following a comprehensive rebranding campaign in April 2026, Erste Bank Polska is successfully introducing the Erste brand in the Polish market. The more than 300,000 new customers Erste Bank Polska acquired during the first half of 2026 underline the trust Polish customers place in Erste’s customer-centric banking approach. Building on Erste Bank Polska’s strong position among retail and corporate clients, Erste sees particular opportunities to further strengthen its offering in the corporate business in the region.

With the rebranding on track, the integration of Erste Bank Polska has entered its next phase, which focuses on the bank’s full technical integration into Erste Group’s infrastructure. At the same time, the legal and organizational integration of Erste’s subsidiaries in Poland is progressing, including the integration of Erste TFI into Erste Asset Management and Erste Securities Polska into Erste Bank Polska.

 2026 Outlook raised on comparable basis excluding Poland

Erste Group’s business in its seven long-established core markets (Austria, Czech Republic, Slovakia, Romania, Hungary, Croatia and Serbia) is projected to experience healthy loan volume growth of 6-8% (versus more than 5% in the previous guidance). Operating performance as defined by operating result is expected to improve year-on-year: net interest income is projected to grow by about 5%, fee and commission income should increase by 7-9% (versus more than 5%). Operating expenses are projected to grow on the order of 3%. Consequently, the cost/income ratio is expected to improve from the level of about 48% in 2025 to less than (versus about) 47% in 2026. Risk costs, at 20-25 basis points, are expected at a similarly benign level as in 2025.

 2026 Outlook including Poland raised

Erste Group in its now eight core markets (including Poland) expects an increase in the customer loan volume to approximately 290 billion euros (versus around 285 billion euros in the previous guidance). It now projects a return on tangible equity (ROTE) of above 20% (versus about 19%) and an increase in earnings per share (EPS) of more than 20% based on 2025 net profit adjusted for one-off items compared to the reported 2026 net profit.

Financial ambition to 2030: aim of doubling of EPS to above 15 euros

In addition to upgrading its 2026 guidance, Erste Group has announced its financial ambition to 2030. The Group aims to double earnings per share (EPS) by 2030 to above 15 euros per share, with an adjusted 2025 EPS of 7.72 euros serving as the baseline. This implies a compound annual growth rate (CAGR) of approximately 15% in the 2025-2030 timeframe, while maintaining a return on tangible equity (ROTE) of more than 20% throughout the forecast period.

Erste Group’s financial ambition is built on the following key assumptions: sustainable organic growth in lending, deposit taking and asset management on the back of superior economic growth in Central Europe; inorganic optionality in Poland and across Central Europe; better operating efficiency driven by larger scale; a continued solid credit risk environment; and, meaningful capital return including regular dividend payments and share buybacks.

All assumptions are predicated on a reasonably stable geopolitical environment over the forecast period, an interest rate backdrop broadly comparable to current levels, and no further material increase in the banking levy, regulatory and general tax burden.

About Erste Group

Erste Group is the leading banking group in Central Europe. Since its founding as the first Austrian savings bank in 1819, Erste has stood for financial inclusion and the promotion of economic prosperity.

Today, the banking group serves more than 23 million customers through fully-fledged banks in eight core markets: Austria, Croatia, the Czech Republic, Hungary, Poland, Romania, Serbia and Slovakia. Erste Group offers private, corporate, and institutional clients a broad range of banking and financial services – from retail and private banking to corporate and transaction banking, as well as asset management. In doing so, the Erste Group combines digital innovation with a strong branch network.

For the first half of 2026, the group reported a net result of 2.0 billion euros, while its CET1 ratio stood at 15.2%. More than 55,000 employees contribute to the banking group’s success. Its total assets amounted to 461.1 billion euros.

You can find more information on Erste Group at: http://www.erstegroup.com