Artemiοs Theodoridis - Deputy CEO, Non-Performing Loans and Treasury Management Vassilios Psaltis - General Manager and CFO Panayotis Kapopoulos - Chief Economist Theodoros Athanassopoulos - In-charge, Wholesale NPLs Evangelos Kavvalos - In-charge, Retail NPLs George Michalopoulos - Group Treasurer and Executive General Manager Lazaros Papagaryfallou - Executive General Manager and In-charge, Strategy and Planning Functions

Jose Abad - Goldman Sachs Jonas Floriani - Axia Ventures Ignacio Ulargui - Deutsche Bank Victoria Cherevach - Bank of America Merrill Lynch Angeliki Bairaktari - Autonomous Research Konstantinos Makrydakis - JP Morgan Alexandros Boulougouris - Wood & Co.

Ladies and gentlemen, thank you for standing by. I am Murdough, your Chorus Call operator. Welcome, and thank you for joining the Alpha Bank Conference Call to present and discuss the First Half 2018 Financial Results. At this time, I would like to turn the conference over to Alpha Bank management. Gentlemen, you may now proceed. Artemiοs Theodoridis: Good afternoon. My name is Artemiοs Theodoridis. I’m the Deputy CEO for Non-Performing Loans and Treasury Management. And I have with me Mr. Vassilios Psaltis, General Manager and CFO; and Mr. Panayotis Kapopoulos, our Chief Economist. Also with us are Mr. Theodoros Athanassopoulos, In-charge of Wholesale NPLs; Mr. Evangelos Kavvalos, In-charge of Retail NPLs; Mr. George Michalopoulos, our Group Treasurer and Executive General Manager; and Mr. Lazaros Papagaryfallou, also an Executive General Manager and In-charge for Strategy and Planning Functions. But I would like Mr. Kapopoulos, our Chief Economist, to start with an overview of the current, recent economic development.

Thank you. Good afternoon, ladies and gentlemen. Greece exited its third bail-out program having accomplished the 2018 both positive growth and high primary surplus for second consecutive year. As this can be seen in the upper left graph on slide 4, GDP growth is gathering momentum supported by tourism and export-oriented manufacturing sectors. More specifically, real GDP registered positive growth for the fifth quarter in a row and increased by 2.3% year-on-year in the first quarter of 2018, while unemployment rate is declining and standing at 19.5%. However, a significant share of new jobs as part-time are depicted in the right-hand side graph. Moreover, as it can be seen in the left-hand side graph, at the bottom, the housing market starts to recover after residential real estate pricing increased for the first time since 2009 by 0.5% year-on-year in the first half of 2018. The house price Tier 1 ratio, well known as profitability ratio, increased in 2017, but remained well below the 2009 level. Another stabilizing sign comes from the time path of the house price index over the per capita disposable income, well known as affordability rate. It declined in 2017 as disposable income registered a small increase. Commercial real estate prices for both shops and offices have been already turned positive during 2017 as depicted in the graph. In the next slide, we present the evolution of the components of aggregate demand, which are moving upwards. More specifically, exports of goods and services are flourishing due to, firstly, the increase of tourist arrivals by 19.1% year-on-year in the first half of the current year as well as due to improved competitiveness of export-oriented industries. However, the moderate increase in retail trade volumes and the fall in VAT revenues indicated that private consumption is expected to remain weak. On the contrary, new passenger car registration are recording significant increases. Finally, in the right-hand side graph, we can see that the increases of the production of capital goods and the capacity utilization rate in industry, along with the expected speed-up of the privatization program point to the revival of business investment. However, public investment expenditure despite the year-over-year increase in the first half of 2018 still underperformed against the target set. Based on the above analysis, real GDP growth is expected to hover around 2% in 2018 and accelerate modestly in 2019. Investment is expected to provide the largest contribution to growth in the following years propelled by the ongoing privatization program and further strengthening of confidence. This is already evident in the left-hand side graph, on Slide 6. We depict with a light blue color line, the rise of Economic Sentiment Indicator as a result of the remarkable increases in all the sub-indices apart from the business confidence indicator in construction. Accordingly, the gradual return of private sector deposits registering an increase by €5.5 billion in the first 7 months of the year, January-July period, is another encouraging factor. Eurogroup’s decision on debt relief measures is expected to facilitate medium-term market access allowing a significant reduction of the country’s gross financing needs. Although the outlook remains positive, it may be affected by uncertainties originating from the external environment. The Turkish currency crisis and the concerns regarding the fiscal discipline of the new Italian government have caused volatility in the capital markets. Also with delays in implementation of structural reforms and the greater-than-expected growth in Eurozone are also downside the risks for Greece’s future economic outlook. Moreover, factors that may affect the downward move of the 10-year Greek government bond yield are: one, Greece’s rating, which despite the recent upgrades by the agencies, remains well below the investment grade as depicted in the right-hand side graph; two, the ECB’s decision to revoke the waiver on Greek government bonds; and finally, the non-inclusion of Greek government bonds in the ECB’s quantitative easing program. The aforementioned developments exert pressure on the Greek government to meet the policy commitment agreed with its partners and to the proceeds with the structural reforms and privatization program in order to boost confidence in the volatile international environment. Let me now pass the floor to Mr. Theodoridis, for the rest of our presentation. Artemiοs Theodoridis: Let us please move to Page 8 for the key highlights of the results. We can see that our strong operating performance that we have delivered in the first half of the year, while delivering also in our NPE plan commitment. At the same time, we maintained our market leading capital position and improved our liquidity profile and ensuring that the bank is well-placed to lend to businesses as demand for credit is starting to increase. More particularly on the liquidity front, we had the very strong performance in the second quarter of the year, moving closer to the elimination of ELA, who had high deposit inflows of €1.2 billion in the second quarter, a trend that has continued within Q3 with another €1 billion of inflow so far. We also increased interbank repo lines by €2.1 billion since March of 2018. These 2 developments combined led to reducing ELA significantly to €1.1 billion at this date from €4.8 billion at the end of March 2018. Our group loan-to-deposit ratio reached 111% as of June versus 132% a year ago. Moving to asset quality. Our progress on NPE and NPL reduction continues in line with the target. On a yearly basis, we have managed to reduce our NPE stock in Greece by €2.4 billion, and our NPLs by €2.3 billion. As of June, our NPE stock on a solo basis stood at €24.3 billion, in line with the target of €24.6 billion. And our NPLs stood at €16.3 billion, also in line with the respective target. Our group NPE cash coverage stood stable at 50% with total coverage including collateral amounting total coverage to 105%. With regards to the operating performance for the first half of the year, we managed to maintain our pre-provision income at strong levels at €803 million, assisted by trading gains. And total operating income reached at €1.35 billion in the first half. Our recurring OpEx came at €540 million, down by 0.2% versus a year ago, in line with our efforts for cost containment. Impairment losses on loans stood at €650 million in the first half, decline a cost of risk of 2.3% over gross loans. As we continue the implementation of our NPE reduction plan. All in all, the bank reported a profit after tax of €12 million for the first half versus €50 million in the first half of last year. On capital, we managed to maintain our best-in-class quality and quantity of capital, also tangible equity is standing at €7.8 billion. Our common equity Tier 1 ratio marginally increased within the second quarter to reach 18.5% at the end of the June from 18.4% in the previous quarter. The decrease in the risk weighted assets contributed towards maintaining last quarter’s strong level. If we may now move to Page 9. You can see a table with our basic P&L and balance sheet figures. But in order to go more into details, let us please go on to Slide number 10 and note that our overall liquidity position has strengthened despite the suspension of the ECB waiver that followed the completion of the third Greek economic adjustment program. During the first 8 months of 2018, we’ve managed to significantly reduce our reliance on ELA by €5.9 billion. Primarily on the back of strong deposit inflows, which amounted to €3.2 billion, increased interbank repos by €2.6 billion and through a successful covered bond issuance of €500 million. End of August, ECB liquidity was maintained at €3.1 billion, broadly flat versus December 2017, as we managed to substitute GGB’s and T-Bills with other ECB eligible assets, mainly supranational issuers and European Government Bonds. Meanwhile, as you can see on the bottom left chart, at the end of August, interbank repos stood at €4.8 billion, increased by €1.4 billion versus June, further diversifying our funding profile and mitigating the waiver effect. You may move on to page 11 and look in detail at the components of our improving funding profile. As mentioned, within last year, we’re able to reduce our Eurosystem reliance significantly by €4.3 billion within the first half and another €1.7 billion from June 2018 to date. The chart shows in the granular way that the reduction was driven by the increase of our Greek deposit base and interbank repo transactions. Looking at deposits in particular at the top right-hand chart, as of June, group deposit stood at €37.1 billion, increased by €1.2 billion during the second quarter of the year. This increase was mainly attributed to customer deposits increase with slightly more than half of the inflows coming from businesses and the remaining coming from households. Quarter-to-date group deposits increased further by another €1 billion on the back of domestic inflows. The bottom left chart illustrates the momentum we’re witnessing on deposit inflows, excluding state deposits for the respective years since 2016. 2018 performance is clearly very strong so far. About 60% of the inflows are attributed to businesses, which were accelerated by the group tourist season. Whereas about 30% of the inflows are attributed to individuals denoting an increase of confidence in the market. About 75% of the individual deposit contribution comes from the affluent part of our clientele. Loan-to-deposit ratio has substantially decreased to 111% for the group and 113% for Greece at the end of June, well below the bank restructuring plan commitment of 119% for Greece. To summarize trends in liquidity, please have a look at the bottom right chart, where it is clearly shown that the funding mix is on normalization path with deposits and market funding gradually replacing ELA. Moving over to NPEs on the Page 12. We can see on the top chart that our NPE stock in Greece, in June, stood at €24.6 billion, reduced by €2.4 billion as compared to June of 2017. Looking more specifically at the growth formation of the second quarter, entries came at €660 million, mainly as a result of the already falls in the retail segment, whereas exits stood at €790 million following the increase of restructuring activity in retail as well as increased liquidations and repayments in wholesale. Regarding our NPE reduction plan, we have achieved our target for June. Going forward, the main levers to drive the second half NPE reduction relates to 2 factors: first, the successful completion of the 2 sales transaction that have already been launched; and second, the outcome of the restructuring activity and liquidations. On the net outflow side, we note that within the second half of 2018, in retail, we expect the acceleration of the improvement of the organic formation, which is driven by increased scheduled liquidations and from expected increased curings. Let me also remind you that we have a new retail NPE transformation plan implemented since the beginning of July 2019 -- ‘18, which consists of new, more flexible and targeted products, focused segments and reinforced channels supported by automated tools and flows. Reception by the clients for this new plan in the first months of implementation is producing encouraging signals. On the loan sales side, our loan disposal program until the end of 2018 includes 2 transactions: the first one is Jupiter, a portfolio consisting of approximately €1 billion of SME loans secured by real estate assets. This is already in the binding offer phase; the second one is a Mercury project, an additional transaction in the unsecured space after the one that we did at the beginning of the year with a portfolio a bit less than €1 billion. This was launched at the beginning of August. As shown in the bottom chart, in regards to timeline, our NPE plan is backloaded towards the end of the year, as those 2 portfolio sales are expected to be completed in Q4. Let us now move to Page 13. You can see that the progress we’ve made with the gross NPE formation in Greece in terms of segments across both wholesale and retail. Through successful restructuring of loans to business customers, gross NPE formation in wholesale has continued to fall in the second quarter. We also made considerable progress in the retail, while the formation has turned negative from slightly positive flat quarter with improvements across all segments on the back of greater retraction activity. Small business loans sustained negative formation trend by €110 million this quarter, while mortgages and consumers posted a marginal gross NPE formation of €15 million and €6 million, respectively. Over to Page 14. In the second quarter of the year, the group’s impairment losses on loans stood at €314 million, implying a cost of risk of 2.3% over gross loans compared to 2.4% in the previous quarter. This quarterly impairment stems from charges we took on re-defaults generated mainly in the retail portfolio. Individual impairment from corporates, updated valuation of collateral for 2017 as well as the shift into costlier management actions. As you can see on the bottom left chart, at the end of June 2018, our NPE total coverage stood at 105%, and our NPE cash coverage stood at 50%. Our group NPL total coverage stood at 127% with NPL cash coverage at 73%. I will now ask Mr. Vassilios Psaltis, our CFO, to go through the operating performance and the capital position sections. Vassilios?

Thank you. Turning now to Page 15. There you can see that on the top chart, there is a bridge between our reported pre-provision income and the core pre-provision income, including the main component that contributed to its evolution. We delivered the core pre-provision income of €282 million in the second quarter. This is up €13.6 million versus the previous quarter. The main components were, net interest income, and this was the largest positive contributor to the core pre-provision income with €15 million. This was mainly due to the decrease of funding-related interest expense. Reflecting the benefit from the negative rate granted to bank due to the accomplishment of its lending targets set by the European Central Bank targeted long-term refinancing operations. Then, fee and commission income remained stable on a quarterly basis on the back of loan-related commission income and other banking activities. Other income had a positive impact in core pre-provision income, increasing by €2 million on a quarterly basis. And finally, recurring operating expenses had a negative impact of €4 million compared to the previous quarter, and this was mainly due to seasonality effect in the administrative expenses. In the second quarter, reported pre-provision income stood at €351 million due to trading gains of €78 million and a negative adjustment of €9 million for integration and extraordinary costs. The trading result is mostly linked with crystallization of gains from our Greek Government Bond portfolio. As you can see at the bottom center of the page, our unrealized gains from our GGB portfolio, recorded directly to equity, stood at €398 million at the end of the first semester. In the second quarter, we realized €78 million of gains through our trading income line. Moving to the bottom left-side of the page, we see that our total assets have been reduced further by €300 million on a quarterly basis on the back of the net loans decreased by a corresponding number. Let’s now turn to Page 16 to elaborate on the quarterly evolution of our net interest income. Starting on from the top left chart. Our net interest income amounted to €459 million in the second quarter. This is up €16 million compared to the previous quarter, primarily affected by the decrease of funding cost of €25 million on a quarterly basis. Out of this amount, the €20 million relates to the positive effect stemming from the application of a minus of 0.4%, which was granted to the bank by the ECB for delivering on its lending target set under TLTRO II. €16.7 million of this reflects a one-off effect of the retrospective application of the negative rate to date, whereas the remaining €3 million relates to the second quarter’s benefit as reflected in the lower funding cost on the bottom center chart. On the asset side, lower average loan balances and spread reduction in the second quarter had a negative effect of €7 million. The drivers of the lower contribution from the asset side to the net interest income are illustrated in the top right chart, which shows the continued deleveraging in conjunction with the spread growth. We note here that loan balances get reduced due to the implementation of our NPE reduction plan but also due to repayments of our loan portfolio, the bank does extend credit to sectors where healthy loan demand can be recorded. Within the first semester, our new loan disbursement amounted to €1.3 billion, relating mainly to businesses and most specifically to sectors that drive the economic uptick, such as a trade, manufacturing, transportation and sourcing. At the bottom left-side of the slide, we can see the drivers for deposits, which contributed marginally to the net interest income increase. Spread decreased slightly, whereas balances increased on a quarterly basis by €1.2 billion, with the change in the deposit mix towards more core deposits. This could be interpreted as a sign for restoration of confidence. Turning now to page 17. Let’s have a quick look on the evolution of fees and commission income. In the first semester, fees and commission income stood at €169 million. This is up 5% on a yearly basis mainly as a result of the increased contribution from credit cards. In the bottom left chart, we can see that both card turnover and acquiring showed a good performance year-on-year, especially in debit cards. Specifically, cards turnover increased by 13% on an annual basis, while merchant sales by 19% compared to the commensurate, corresponding first half of last year, with debit card increases by 20%. On page 18, we have a look at the operating expenses. Our recurring operating expenses for the first half of the year remained effectively flat compared to previous year and stood at €540 million. Staff cost were decreased by 4.7% to €234 million, while general administrative expenses remained flat. Total operating expenses performance, including one-off expenses, was down by 1.6% year-on-year, while our cost-to-income ratio came to 49.5% at the end of the first half. Our continued efforts for platform rationalization and headcount organization in Greece are shown in the 2 charts at the bottom of the page, where we can see a 2% reduction of our workforce on a yearly basis and also a 5% reduction of branches for the same period. Such efforts are expected to continue and escalate in the upcoming quarters with new initiatives. It has been mentioned that the reduction in workforce shown does not include the impact from the recent voluntary separation scheme program as this was launched in June. All in, if we also account for this, staff in Greece was reduced by 707 employees in 2018, corresponding to an estimated annualized benefit of €27 million. On page 19, on the top chart of the page, you see the evolution of our common equity Tier 1 capital spanning now at €8.9 billion, with core equity Tier 1 ratio at 18.5% as end of June 2018, and this is up 14 basis points on a quarterly level, benefiting from the reduction of risk-weighted assets attributed mainly to lower credit risk. This has more than offset the negative impact from the lower valuation of our fair values with P&L, for OCI reserve and our quarterly results for the period. The bank’s total capital adequacy ratio of 18.5% provides for a €2.7 billion buffer over and above the 12.875% overall capital requirement target set by the regulator for 2018. On a fully loaded Basel III basis, our equity Tier 1 ratio stands at 15.5%, taking into account the 5-year phase-in for the implementation of IFRS 9. On the bottom left chart of the page, you see the bridge from statutory equity to regulatory capital. Our tangible equity as of the end of first half stood at €7.8 billion. Having regulatory adjustment of circa €1 billion, where most of them relate to the IFRS 9, will reach on a core equity Tier 1 capital of €8.9 billion, which is essentially the total regulatory capital of the group as we practically have no hybrids or Tier 2 instruments in our capital base. At the bottom right chart, we can see that our risk-weighted assets at the end of June 2018 amounted to €48.1 billion, and this is down 1.2% on a quarterly basis due to lower credit risk contribution. At this stage, we have concluded our presentation on the first half, and we open the floor to questions.

The first question comes from the line of Abad, Jose with Goldman Sachs. Please proceed with your question.

Yes. Hello, good afternoon. Thank you very much for the presentation. My first question is on the marker side. It has to be with Turkey that you mentioned briefly in the presentation. Could you please give us some data on the exposure of the bank to exporters which are exposed to the Turkish market? As far as I know, actually, Turkey represents north of -- somewhere between 5% and 10% of Greece total exposure, but interesting to know actually what’s your underexposure to Turkey through Greek exporters. Second question has to do with the [Indiscernible]agreement. You may know that actually Germany and France agreed in mid-June on the say compile of the banking union. A precondition for this is actually all European banking sectors reaching a gross NPA ratio of 5% and a net NPA ratio of 2.5% by before 2024. Obviously, I understand that Greece -- even though this was not specifically mentioned, but Greece will be exempted to this. But I would like to know your views on this, and whether -- I mean, any update that you could give us on the new targets for 2020, 2021 basically on your negotiations with SSM or discussions with SSM. And maybe the last question is, if you could actually elaborate a bit deeper on the NPL formation in Q2, which seems to be probably weaker than expected and seem to continue what we saw in Q1. Thank you very much.

Well, hi, this is Vassilios Psaltis. Taking your questions one by one. I think starting on with Turkey, practically, the exposure that we’re having through either our portfolios or to concentrated exposures to funding Turkish -- the trade with Turkey is negligible, so there is no meaningful number there. Going on to your second point, indeed, this is something which we are following very closely, and so this, we understand, is indeed manifesting also with the discussion that it is around the implementation of calendar moving on from the flow, as it is currently implemented from the April 1. Moving onto the stock, we have seen recent decision that the SSM is going to be venturing toward that direction. However, Greek banks, being in a cluster of high NPE banks, obviously, there will be a further closer look before implementing that. Within that context, you are right that Greece is venturing away from the current framework of monitoring of target-setting and monitoring its NPE reduction plan, which was mostly driven by memorandum, and going towards alignment with the framework of the high NPE banks within the SSM. That process is going to get concluded by the end of March 2021, and indeed, there are several steps that the Greek banks will need to accomplish before that, both from a planning and from an overall business point of view. So I think this is something which is too early to give even an indication of where things will be heading towards that direction. But be rest assured that the message that there needs to be a significant decrease in our NPEs by that date is very well understood. Now in terms of the NPE formation, you said that it may have not met your expectation. However, we are still focused in delivering the targets that we have for the end of the year. From where we’re standing right now, there is another €2.9 billion to deliver. However, you have seen that €1.9 billion out of that comes from 2 transactions, which are, one is in a very advanced stage and the other is in an advance stage, and we are confident that we will be able to sign with counterparts on both transactions before year-end, and thus, have them count, as it was the case in last year, towards reaching our targets for this year. The remaining €1 billion is going to be supported by increased liquidation activity as the e-auctions in Greece gain momentum. So we expect to be supported also on that front along with the development, the positive developments that we do expect on the operating front from the new platform that we have launched in early July.

The next question comes from the line of Floriani, Jonas with Axia Ventures. Please go ahead.

Good afternoon, guys. Thanks for the call. I have a few questions. The first one, can you just please update us on your latest guidance on NII and cost of risk for the year, given the, if there is any change because of the one-off in NII and the €3 million per quarter going forward? But also on your cost of risk side, it looks like from what you previously were guiding in Q1 from the, around the 200 bps of cost of risk, you’re going to need to do a bit of a catch-up and the trend needs, really needs to accelerate now in the second half as I can see, so this is the first one. Second is, if you can develop a bit on your policy behind the unrealized trading gains. I considered you have quite a considerable amount of trading gains related to GGBs. So how do you approach that amount that in a way is available for you to just move into the P&L? Can I see that as a way that you’ll protect your bottom line no matter what for full year ‘18? Or even use part of it to maybe if you are aggressive on write-offs, so have like a likely higher cost of risk in light of improving your asset quality? Third question is on your retail efforts on your NPL side, I understand that you have started your efforts quite recently, but when will you be able to see material or substantial effects on your formation? As mentioned now in the previous question, I mean, we have some positive uptick. I mean, is this going to be like a Q3 event that your efforts are going to be yielding some better control on the formation side? Or it’s like a late 2018 event or even like a 2019 event? So I think I’ll stop here.

Jonas, thank you. This is Vassilios. I’ll pick up on your first couple of questions. The guidance on net interest income has been for quite some time, but for this year we expect to have a high single-digit to low double-digit reduction on net interest income as a function of the IFRS 9 impact at the introductory balance of this year, counterbalanced by some positive effect from the mix effect in the liability side. These are all valid trends, which are getting a bit of one-off support, as we have seen from €17 million by being able to hold on our TLTRO II target. So that would entail about €3 million going forward. But that is not a significant change in order to alter that guidance. We actually can confirm that guidance. Now on the impairment line, indeed, the guidance that we had given was around the 190 to 210 basis points. And this is now expected to get an uptick by roughly 30 basis points over our previous guidance. And at this relates, as we have mentioned in the presentation, to higher re-defaults and less curings that we have experienced in the retail portfolio, but also in the upsizing of required provisions for specific corporate cases. That is something that we expect that it would be, it would suffice to deal with those trends, as we have evidenced in the second quarter, and rolling them forward for the rest of the year. Now on your second question on the unrealized trading gains, this is pretty much a conscious decision. I mean, indeed, this is a buffer which we put it to work, as you have seen very consciously both in the first and the second quarter, and we retain all the optionality to continue to do so until year-end. Artemiοs Theodoridis: In terms of the retail NPE transformation that we’re implementing, we invested a lot in that during the first quarter and second, and we put it into actual operation on the 2nd of July. We expect results in terms of our final numbers to become evident by the fourth quarter of the year, however, because it is too early now to talk about results since this is a new plan. However, the first indication that we have as far as the reception by the clientele of the new product mix goes, are very positive. So we do have an optimism that the way that this plan is going to move the numbers is going to be definitely in the right direction.

The next question comes from the line of Ulargui, Ignacio with Deutsche Bank. Please go ahead, sir.

Hi. I just have 2 questions. One on NPEs, trying to come back here, but I mean, in terms of organic reduction, what should we see to perform better into the second half of the year? Is it going to be faster write-off policy or clearings? Because, I mean, you have a reasonably half of the grant right so far. So just if you can provide any more color there. Secondly, on the cost side, I mean, when would we start to see the benefits of these annualized €27 million? Will it be in 4Q or it will be more into 2019? Thanks. Artemiοs Theodoridis: In terms of the NPE policy, what we expect to increase with the policy is not write-offs. It’s curings and liquidations. This is where this is targeted. And liquidations will increase because of the change in the environment, which has allowed us to program a lot more liquidation for the next few months. And curings will hopefully increase because of our change in the mix of products as I described previously.

Ignacio, it’s Vassilios. Now for your second question about the one-off benefits from the VSS going to be start getting visible, they’re going to start from -- essentially from the third quarter onwards. This €710 million number that we gave, it comprises of €620 million that participate at the VSS, and another attrition that we had since the beginning of the year, which happened more gradually. The VSS-related number, they’re going to be mostly leaving at the end of the third quarter, and thus, this is a bit the cycle that you should expect to see until they get -- we see the fully phased-in benefit.

Thanks.

The next question comes from the line of Cherevach, Victoria with Bank of America Merrill Lynch. Please go ahead.

Hello good evening. Thank you for taking my questions. Four from me. Could you give us some sort of visibility on where you expect headcount reduction to sort of go from here? I think I heard you say that you’ll continue, and you’ll escalate with some new initiatives, so it would be good to just hear a bit more about what those will be. And my second question is on your NPE targets. From what I understood, there was supposed to be conversations taking place in the full with the supervisor. Could you just give us some color about how that is going? I hear you’re on your new policy sort of more curing, more liquidations, but is the supervisor sort of tightening these NPE targets as well? My third question is just a clarification. Did I hear you correctly that your cost of risk guidance went up by 30 bps? So that would be 220 to 240 bps guidance for the year. And my last question is around the sale of properties that you have on your books. Could you give us an idea of what sort of haircuts you’re taking, if any, sort of the levels below market value? Just some color on pricing would be very helpful. Thank you.

Victoria, it’s Vassilios. Let’s quickly try to address the first 3 of your questions. As far as the headcount reduction is concerned, one key point to remind you is that all the related costs have been taking upfrontly in the fourth quarter of 2017 to an amount of €93 million. And that amounts to a multiple of the number that we have achieved with the current first budget, if you would want, from the VSS. We can go into much higher numbers, and we’re only going to be seeing the benefit in our numbers going forward. However, when is going to be the next effort? Practically this is something that we have to be very careful. Therefore, we’re not going to be announcing that in advance. Secondly, as far as the NPE target is concerned, you’re right. There’s going to be a discussion starting on from late September with our supervisors, with our regulator in Frankfurt, and that will be on the basis of an updated rolling forecast for Greece that we’re going to be giving for 2019. That dialogue, we expect to continue throughout the year and until the end of the first quarter, when we’re going to be having the submission that I referred to before under the new regime. That will go up until 2021. So there is more to come on that one. On the cost of risk clarification, I confirm the numbers that you have said. And with that, let’s go on the first, on the fourth question. Artemiοs Theodoridis: Right. With regards to your question on property sales, we have been selling properties predominantly through the retail network within the first half of the year above book. And we’re now focusing on certain portfolio transaction. One of which is included in the Jupiter project is a €55 million portfolio, a mixed bag of commercial properties and residential. The first price indications are positive with regards to the pricing of such portfolio. And we’re also planning further portfolio sale of commercial properties to a tune of €70 million by year-end or so. And again, pricing indications are quite positive with regards to where we stand in our books.

The next question comes from the line of Ms. Bairaktari, Angeliki with Autonomous Research. Please proceed.

Hello. Thank you for taking my questions. I have 2 questions, please. The first one, on your NPE plan update. If I understood correctly from what you’ve mentioned already, is it true that you will effectively update your plan for 2019 now in September, and then in March of next year, you will submit a plan until 2021, which will be along the lines of other European banks with high NPEs? And should we expect any sort of different approach or any change when you submit your updated plan next March? We recently saw, for example, that Bank of Cyprus did quite a transformational deal with regards to sort of NPE reduction. Would it be possible to imagine something similar for you as well in the future? That would be my first question. And my second question, we still don’t know how the regulator is going to factor in the stress test result in the SREP. When should we expect this discussion to start? And when do you think we will have indications on the SREP for next year?

Angeliki, it’s Vassilios. Well, essentially, I confirm what you said. It’s pretty much reflecting what I said before. Now on the different approach and on the example of the Bank of Cyprus transaction, indeed, the Greek market and the Cypriot markets, they may have things in common, but they are also different in a number of things. I think what was encouraging from this transaction is that there was an evidence of a significant wallet that were at the, we understand, at the final stage, the very visible, very strong bidders. And they had, which have the firepower to conduct those vast transactions. Well, this is clearly one of the things that we will need to consider along with many other things as we’re going to be expanding the planning horizon to deliver our plan. On the stress test and how it’s going to be a deal in the SREP, essentially, this is a discussion that is going to be towards the year-end with our regulator, and we will need to see if and what sort of change it may have both at an absolute level, like if you compare to how we fared last year, as well as on a relative basis, how our very good strong performance in the stress test that may give us some brownie point in our discussion.

If I may just follow up on one thing that was also asked previously, but I’m not sure I fully got the answer. If you could just, you plan €1 billion of net outflows outside of sales, including liquidations now. When I look into your Q1 presentation, I think you had group sales together with liquidations to be around €2.1 billion. I’m just wondering, have you now shifted from cures as you see less cures, into more liquidations? And maybe in other words, would it be possible to split this expectation for €1 billion organic reduction in the second half into expectation for cures as opposed to expectation, as opposed to a reduction from liquidations, please?

Angeliki, you’re reading to the numbers is correct. Indeed, however, we want to retain the flexibility in the second half of the year to try and max out whatever we can. But indeed, compared to the performance that we had so far in that particular element, first half versus the second half, but we have the targets. This is really an area that we understand that we need to make a significant improvement. And on that one, there are certain risks entailed in achieving that. We understand that.

The next question comes from the line of Mr. Makrydakis, Konstantinos with JP Morgan.

I have 2 quick questions. The first one is more on the generic macro outlook regarding credit growth. We see the loan book, the net loan book sort of declining quarter-on-quarter and year-on-year. So given that Greece is now out of the program, what are your thoughts on credit growth? And do you see it picking up in the second half of 2018 maybe early 2019? And if so, if you can, of course, comment by what advancement rate? And the second question I have is on the auctions. I see on Slide 28 in the presentation that they have increased significantly. I was just wondering whether you can provide some metrics on that in terms of actual revenues made from the 996 auctions completed in the period from March until July? And also, what are the expectations, again, for the remaining of the year? Thank you. Artemiοs Theodoridis: Look, our expectation for the credit expansion in 2018 is that it will be almost zero because there will be stabilization during 2018. We expect that we will see both the figures in credit expansion in 2019 and 2020, especially coming from the area of corporate portfolio, not so much in the retail area.

Coming to auction activity -- this is Lazaros. Coming to auction activity in the first half of the year, we have a significant hike of auction activity in the second quarter for the system as a whole. Auctions in the second quarter have been almost 4 times what we have seen in the first quarter of the year. And obviously, Alpha was following that path. During July also, we have seen an increase of conducted auctions. Overall, within the first 7 months of the year, for Alpha, we had 700 conducted auctions, some of them successful, some of them unsuccessful. Whereas, we expect a significant increase of activity from September onwards, as more than 1,000 auctions have been scheduled to take place by year-end.

And would you be able perhaps to comment on what your income or what sort of numerical value do you expect for these auctions to generate?

For the first few months of the year, the value of the properties that have been auctioned is to the tune of €300 million. Now obviously, we’re participating in these auctions as a bidder. For some properties, we provide a bid; for some others, no, we do not. However, we expect that in the following few months, we’re going to see more successful auctions, with the bank participating with an increased pace.

The next question comes from the line of Mr. Boulougouris, Alexandros with Wood & Co. Please proceed.

I just have a very quick question on -- technical question on the €35 million losses on modifications of contractual terms that you mentioned in the second quarter. Could you clarify a bit further to help us model it a bit going forward as you may separate from the guidance on cost of risk and because it goes on the other impairment line? And also just to clarify a bit on the questions previously. We saw that the write-offs were very few in the second quarter. This should be a run rate that we should see in the remainder of the year? Is that correct? Thanks

Alex, it’s Vassilios. Starting off from the latter indeed, accounting write-offs, those that are not timely and directly linked with management. Actually, they were very few and this should be the expectation until year-end. In terms of modification losses, I think in the second half, probably, we may see a level of activity that may be around the first half, which would take the overall number into low triple digit, I mean, something to the €110-ish million, €120-ish million for the year, something like that.

And this should continue going forward then?

Well, that is very closely related to the type of restructuring activity. So along with the new plan, obviously, this is something that will need to be reexamined, but this is pretty much reflecting the work that we have been conducting this year, not just us, but the whole system. This is an IFRS 9 requirement.

Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to management for any closing comments. Thank you. Artemiοs Theodoridis: This is Artemiοs Theodoridis again. I think a few takeaways from this presentation. One, we have no surprises on PPI. Basically, no negative surprises. We just have the sort of one-off item on trading, which helps our result. Second, that we have an improvement, above-expectation improvement in our liquidity position. And third, that we still have an issue with NPE formation and impairment, which we are tackling with a combination of operational improvements and increased sales. Thank you very much for attending.