Erste Group on the
capital markets

The equity markets covered continued the positive trend from the previous year. Some of the indices posted two-digit gains and new all-time highs in 2025. On the equity markets, the first six months of the year were largely volatile and marked, most notably, by protectionist tendencies and erratic trade policies pursued by the US, including the announcement of an extensive tariff package on imports of goods. Later in the year, markets calmed as trade conflicts eased after a tariff agreement was reached with the European Union and a certain rapprochement was seen in US trade relations with China. Rate cuts by the US Federal Reserve (Fed) and the European Central Bank (ECB), robust economic data and expectations of positive corporate profitability, backed by results released in Europe and the US, provided an extra boost to equity prices.

Equity Market Review

New equity market highs at year-end

In the US, the Nasdaq Composite technology index recorded the strongest gains of all US indices, rising 20.4% to 23,241.99 points. The broader Standard & Poor’s 500 Index was up 16.4% at 6,845.50 points while the Dow Jones Industrial Average advanced by 13.0% to 48,063.29 points. Additional momentum for European markets came from improved earnings forecasts as well as the announcement of EU fiscal policy measures in infrastructure and defence. The Stoxx Europe 600 Index, which reflects the performance of the 600 largest exchange-listed companies in 17 European countries, likewise hit a new record high and, at year-end, was up 16.7% at 592.19 points.

Rate cuts in Europe and the US

In the year that ended, the central banks were once again faced with trade conflicts as well as their impacts on economic growth and inflation. The ECB continued the relaxation of its monetary policy that it had started in the previous year by a total of four rate cuts during the first six months. Against the backdrop of a robust eurozone economy, reduced downside risks on the back of the EU-US trade agreement, and an expected stabilisation of inflation around the ECB’s 2.0% target, the base rate was then left on hold at 2%. The Fed, on the other hand, didn’t start to cut the base rate before September and, in two additional moves, reduced it further to 3.50%-3.75%, even though inflation rates were edging higher, mostly due to tariffs. The cooling labour market was cited as the key reason for embarking on a less restrictive monetary policy.

Robust economic global growth

In 2025, the global economy proved more resilient than expected, supported by improved funding conditions, rising investment and trade activities related to artificial intelligence. Worldwide GDP growth stood at 3.3% in 2025, with 3.3% likewise anticipated for 2026. In 2027, GDP growth is forecast at 3.2%, with emerging markets in Asia remaining the key drivers of global growth. Inflation is expected to subside further, approaching central bank targets. In 2025, GDP growth amounted to 2.1% in the US, with 2.4% being expected for 2026 and 2.0% for 2027. In the euro zone, GDP expanded by 1.4% in 2025, with 1.3% forecast for 2026 and 1.4% for 2027.

Record gains in European bank shares

Along with the technology sector, bank shares were among the favoured segments and hence among the top performers in the equity markets. European bank shares in particular posted an extraordinarily strong performance. These gains were attributable to solid results and projected earnings growth. The Dow Jones Euro Stoxx Banks Index, which had already posted a rise of more than 20% in the previous year, gained 80.3% to 263.27 points in the course of the year, thus outperforming all other sectors in Europe.

ATX at an all-time high

The Austrian Traded Index (ATX), the leading index of the Vienna Stock Exchange, enjoyed an extremely successful trading year, closing at a record high of 5.326.33 points. Having risen by 45.4%, it posted the highest annual gain since 2004. The ATX Total Return (including dividends) grew 52.2% to 12,990.45 points. The Vienna Stock Exchange index thus clearly outperformed the US indices and the European Stoxx Europe 600. In contrast to the preceding year, the rise in the leading index was broad-based – out of the 20 ATX equities, only four registered a negative annual performance. This was supported primarily by Europe-wide tailwinds that drove financial equities, which are heavily weighted in the ATX, and a robust growth outlook in Central and Eastern Europe.

Erste Group Share

Share price exceeds EUR 100

After advancing by more than 60% in the previous year, the Erste Group share continued its uptrend in 2025 and ended the reporting period on a record gain of 72.5%. On 30 December, the last trading day of the year, the Erste Group share closed at an all-time high of EUR 102.90. It had marked its low at EUR 54.95 on 9 April 2025. The key drivers of this extraordinary growth in share value were highly bullish market sentiment, the extremely positive performance of the entire European banking sector, as well as, once again, the strong results reported by Erste Group with strong volume growth, solid capitalisation, a better-than-expected net profit and the announced market entry in Poland. The acquisition of a 49% controlling stake in Santander Bank Polska, announced in early May 2025, and thus access to one of the fastest-growing and most profitable banking markets in Europe was welcomed by investors and analysts, particularly as the transaction was fully funded from internal resources. By taking this step, Erste Group is not only strengthening its presence in Central and Eastern Europe but also improving its profitability profile on a sustainable basis. The transaction was closed on 9 January 2026. The bank will be renamed Erste Bank Polska in the second quarter of 2026.


Performance of the Erste Group share and major indices 
(indexed)

Employee share programme

In 2025, approximately 37,000 employees acquired Erste Group shares under the programme that has been in operation since 2022. The successful continuation resulted in a further strengthening of Erste Mitarbeiterbeteiligung Privatstiftung (Erste Employee Foundation), in which the voting rights of the shares acquired under the employee share programme are combined.

Performance of the Erste Group share versus indices

* A comparison after the IPO would not be applicable as Erste Group has been included in this index only since 16 January 1998. ​​​​​​​​​​​​​​​​
IPO … initial public offering, SPO … secondary public offering

Market capitalisation rises above EUR 40 billion

After the number of shares of Erste Group Bank AG had declined to 410,514,384 upon completion of two share buyback programmes with an aggregate volume of EUR 800 million in 2024, it remained unchanged last year. At year-end 2025, the market capitalisation of Erste Group reached EUR 42.2 billion and was thus 72.5% higher than at year-end 2024 (EUR 24.5 billion).

Erste Group is listed on the stock exchanges of Vienna, Prague and Bucharest. Its main stock exchange is Vienna, where in the year ended, its trading volume averaged 442,481 shares per day.

Share and sustainability 

Erste Group has an MSCI ESG Rating of AA, a “Low Risk” score from Sustainalytics and, with a C rating, holds prime status in the ISS ESG corporate ratings. In addition, Erste Group has been part of VÖNIX, the Vienna Stock Exchange’s sustainability index, since its launch in 2008.

Dividend

Erste Group’s dividend policy is guided by the bank’s profitability, growth outlook and capital requirements. The 32nd annual general meeting of Erste Group that took place on 21 May 2025 resolved to distribute a dividend of EUR 3.00 per share for the 2024 fiscal year, which was paid out on 28 May 2025. 

In connection with the acquisition of a 49% controlling stake in Santander Bank Polska announced on 5 May 2025 it was stated that in addition to the cancellation of the share buyback programme with a volume of EUR 700 million announced on 28 February 2025 and the implementation of various balance sheet optimisation measures, the dividend payout ratio for the 2025 fiscal year will be reduced temporarily to a maximum of 10%. For the 2025 fiscal year, the management is proposing a dividend of EUR 0.75 per share.

1 Erste employees private foundation, syndicated savings banks foundations, own holdings of savings banks
2 Unidentified institutional and retail investors
3 Incl. market makers, prime brokerage, proprietary trading, collateral and stock lending positions which are visible through custodian banks

Ratings of Erste Group Bank AG

In November 2025, Moody’s upgraded Erste Group Bank AG’s outlook from stable to positive and confirmed the A1/P-1 rating. Among other aspects, it highlighted the bank’s funding strength. Entering the Polish market will further strengthen the diversi-fication of income flows in Austria and CEE. Fitch left its rating unchanged at A/F1 with a stable outlook, Standard & Poor’s at A+/A-1 with a positive outlook.

Funding Activities

Erste Group was active across all seniorities in the past year. The year began - contrary to previous years - with the issuance of a green senior preferred bond (EUR 750 million, 8NC7, MS+98bps), followed only afterwards by the issuance of a EUR 1 billion 
7-year mortgage covered bond priced at MS+52bps. The first quarter was completed by Erste Group Bank AG with another green senior preferred bond, this time in a 6.25NC5.25 format (priced at MS+88bps).

In the second quarter, following the announcement of the acquisition in Poland, an AT1 issuance took place. The volume was EUR 1 billion, featuring a 6.375% coupon and perpNC7 structure. Also in May, another EUR 1 billion mortgage covered bond was issued; at that time, the 10 year maturity segment was available, and the deal priced at MS+52bps.

In mid August, the subordinated segment was once again addressed with the issuance of a EUR 750 million 10.25NC5.25 tier 2 bond, achieving a re offer spread of +130bps. For the remainder of the financial year, the focus shifted to further issuances by the subsidiaries.

Investor Relations

Open and regular communication with investors and analysts

In the year ended, the management and the investor relations team met with equity investors in 284 one-on-one and group meetings. Questions raised by investors and analysts were answered both at events with in-person attendance and during telephone or video conferences. The presentation of the 2024 annual result was followed by an analysts’ dinner and a road show day with investor meetings in London. After the release of first quarter results, a road show was conducted in Europe, and after the release of third-quarter results in Europe and the US. Erste Group presented its performance and strategy against the backdrop of the current environment at international banking and investor conferences organised by the Vienna Stock Exchange, Unicredit, Kepler Cheuvreux, Morgan Stanley, PKO, Bank Pekao, Concorde, RBI, UBS, Bank of America Merril Lynch, Deutsche Bank, Goldman Sachs, Barclays, Baader Bank, mBank, JP Morgan and Wood. 67 additional meetings were held to intensify the dialogue with bond investors. A large number of one-on-one and group meetings with analysts and portfolio managers were held at conferences, road shows and investors’ days hosted by Intesa Sanpaolo, UBS, HSBC, Bank of America Merril Lynch, Citigroup, Danske Bank, TD Securities, Barclays, Rabobank, Santander, European Covered Bond Council (ECBC). Comprehensive information on Erste Group and the Erste Group share is provided on its website at Investor Relations | Erste Group Bank AG. The investor relations team also provides news through Erste Group’s social media channels on platforms such as LinkedIn and YouTube. More details on the social media channels, the news/reports subscription and reminder service are available at Service for Investors | Erste Group Bank AG.

Analyst recommendations

In 2025, 21 analysts regularly released research reports about Erste Group. The Erste Group Bank AG share was covered by financial analysts at the following national and international firms: Autonomous, Bank of America, Barclays, Citigroup, Concorde, Deutsche Bank, Exane BNP, Goldman Sachs, JP Morgan, JT Banka, KBW, Kepler Cheuvreux, mBank, Mediobanca, Morgan Stanley, Pekao, PKO, RBI, Trigon, UBS and Wood. As of the end of the year, analysts had issued the following recommendations: 10 rated the Erste Group share as Buy, 8 as Neutral, 1 as Sell and 2 did not issue any rating. At year-end, the average year-end target price stood at EUR 95.0. The latest updates on analysts’ estimates for the Erste Group share are posted on Erste Group’s website under Analysts and Estimates | Erste Group Bank AG.

Related topics