Commerzbank (CRZBF) 12 May 222022 Q1 Earnings call transcript

Good morning, and welcome to our earnings call for the first quarter of 2022. Two weeks ago, we had to pre-release our very good financial figures with an ad hoc statement. But it's not easy to talk about financial success, while many people in Ukraine suffer from the wall. We experienced a turning point in history and its implications are hard to assess. This applies both to politics and business. to course and the to our job bank manage execution our strategy. of and move it's assess professionally risks our of But forward with made. for is progress convincing QX proof And we a have the Russia. We reached a operating profit due despite provisions strong to delivery just by XX% The one revenues, quarter. in increase to profit is the pushed has pre-provision QX €X in driven strong a which billion in

risk On have provisions. we additional side, the built prudently

ratio With the more this level top adjustment to Costs roughly €XXX first than cost our efforts. increased prepared the €XXX to potential comfortable our we the more million. and these operating quarter. should are Bottom increased thanks of defaults line, have came a We doubled and ongoing slightly CETX provisions, for we to XX% the income of €XXX ratio our by reached well war. net XX.X%. be from we in million a extra profit have target also and credit cost-income stable than million on in pandemic Despite and with

billion, by short would provisions down a the With we have take I today implementation XX% reduced exposure. progress, of mid-February, on almost to net book exposure. update the of term Russia you our and exposure strategy well we look our €X.X we generally at to Russian Before which our like are Since XX% contained. cover as

XX% at is the stood arises but Bank deducted Regarding our of than Central from million This in Russian subsidiary, ruble CETX Russian equity capital. already €XXX at Eurasija. €XXX Eurasija holds clearing it million from of risk the house. domestic more and almost Further also deposits

tasks sanctions. exposures. support with clients our in in we continue important the of as will will all continue at important, a client-focused We especially Equally the Mittelstand. is one bank, most to German moment the our compliance further reduce This to

digitalization and on achieved me milestones, product progress the with in we space. PSBC, the further first especially quarter. let In in transformation move Now, the

As mobile mobile launched consumer banking of month. the cars, is buy the on digital our iOS vacation opening. function an a we team private example still This trips. end-to-end feature can process, to digitalized take this available follow Android, app will In Furthermore, on for loan or account laptops a new has customers have implemented loan. already a

customers powers week cooperation New XX have banking set such overhauled can our towards on retail can new developed user opening private product time, Investment by account the clients we example and end as Office. on. retail portfolio towards attorney an launch, target we of MoneyMate. is and towards transparent our well in for first good migrating the Corporate directly the process. have up new for around new well a the design management especially our is already services. A Chief In for attractive, started We products customers direct X,XXX the investment Investors, million. have Both and our pilot transformation. Mittelstand first-time Private year. green download are has the total further have X,XXX that the the made a added sustainability interface our deleted as services, X,XXX with On management by experts easy-to-use this way quarter that second with successfully products, now inflows for the be support since solution launched March, strict offerings Allianz Global with on in easily our another customers. we our have In app of a of bank. introduced At have development very In digital in we year. In MoneyMate €XXX Clients, called been important of X,XXX wealthy investors. In Management, clients a product apply we of for of the into all that we and clients Currently, same as Wealth last own are and at our jump managed criteria of progress clients we relevant end

QX, setup also the volume supported year, XX% advisory centers Regarding at of application to the billion high rate by that mails announced Prioritized well Moreover, on a business when our and €XXX And program. of towards sustainability, a year-end the is of number work the the for via built the final parts €XXX of execution centers. redundancy jobs the you, group, in the assignment in in advisory staff every To advisory new center. are process we up volume, the figures compared selected future client reached applications to we have for still is business have This QX. track zero from employees. than an the we already was our all represents branch. currently respective staff also slide further In organizational last proof the in Details of sustainable the targeted year. branch of of make This in of end all found at in of our we start in step be the already flow our billion. large remind target appendix. further levels of can is managers calls have more up the PSBC. all contacts doubled concept of This and organization. in On

to requirements Force. TCFD, non-financial aligned our Task have Regarding the the report of we

the The the client's step-by-step the will And our conditions on agreed loans we enhance climate. of disclosure team our has with sustainability Clients targets. on compliance, forward, Going depends Corporate for in sustainable loan, further Mittelstand. introduced

close with Bettina to the before the takeaways hand over for me financials. key let I So,

strong financial across client the performance good revenues. have in segments has delivered in we a Very increase strong First, QX. all supported business

transformation on segments. our progress in all Second, is track

the Although, the I absolute requires see of team. transformation massive stumbling focus any don't efforts still and blocks, whole

than €X in billion result. of confident target more Third, we to XXXX are reach net our

pay supply system. with uncertainties we have our outlook obviously now course reaffirm for a the a the banking payout you proposals to Of increased the intention and helpful for issues, ratio inflation. and in over from XX% Furthermore, And pandemic, impact XXXX on quarter. current the to war, soften the rates comes Nevertheless, Poland to to chain due are the first accrued for Bettina. not the in dividend customers

from Thank you, good Manfred and my morning side.

The higher cost-income very also already strong. target is reached ratio biggest interest we mBank. good XX%. year-on-year, by contributor net had With stated, revenues. Manfred up As XX% particular, XX%. been costs in a XXXX. start into income very The been income increased driven profit In the by has has has with underlying commission Net line pre-provision

underlying not creation effects. is €XXX ratio level clearly The and this is of to part to the significant of be are the further shows €XXX cost-income year to million. expect of track this Overall, of a In do have of our million. already level we a now full right we by adjustments While result influenced very adjustment. on cover bookings result due total, available we a million €XXX this and solid to expected million A improve that to result the risk reached leads effect net for Russia level, profitability. potential top top on €XXX from operating it

gives the XX% for risk, the starting XX.X% XXX and started capital return buffer have basis our MDA points a cover strong. grow to point CETX us to of ratio remains capital dividend shareholders. and to The to a accrue business, we comfortable announced, and As of potential

good revenue with underlying the commission Net improved eight. Now, but to income without with There TLTRO. commission quarter in on being business. performing let's items. Year-on-year all page and has well. would briefly in This we all starting payment look Corporate have and few exceptional result, healthy business the slide the risk had indicators the volumes a from only also €XX On noteworthy improved the Clients nine, revenues Russia. exceptional was key quarter effects the the at first benefit million we page from income except transactions the benefiting the were FX for list segments improved items leads the a from XX.

increase up. This the one-off which of the us basis next the driven from has NII to in which mBank, currently Slide to development expect impact. churn quarter. transactional a have mBank somewhat of QX. Also an had Underlying continue level fees. XX. also return strong supported benefited expect XXX in NII quarter. forward going quarter previous PSBC has seen quarters business lower, leads previous points, Germany the from by similar it is future this solid Going securities the We could rates further therefore reference to Poland. expect had year. rate also interest last business the the to we and is million to was on up a €XXX by This be The to been in

clients. vast proxy deposits for So to be basis is the and expected. increased further as Higher below or been to far QX beneficial for beta has customer mBank's modest next a beta likely remain the retail good NII, rate be to of With up the rises, will deposit rates XXX quarters. majority is points

a from further made Polish too started, was Germany, to to legislation and impact slightly and and but concrete been process NII customers reacting and up impacts. increased. proposals the last it's has However, to give has Prime loans deposits compared In of NII some rates their year. early on QX PSBC Minister, The rising assessment potential corporate consumers. both

rates. higher the the rates from end million curve to of deposits have by addition, €XXX quarter year. XX-year slide, In pricing €XX In the is at to for around us led If forward deposit from deposit million on increased to deposits NII models. contributions This extension current the realized, QX, the based for forward leads have the model NII we next to beta the of the to year-on-year. outlook NII medium-term the expect up higher with to would compared previous

further NII result in Further, our deposits higher model higher at curve and XXXX increasing XXXX from curve be turn scenario, that updated and invest deposits deposits would disclosure to at change. QX, after impact and negative compared of of the that billion no will deposits. environment. around calculation longer based beta on our we XXXX, from on the €XXX have have end potential the composition on deposit be constant is euro the will would deposit assumption, scenario XX-year the this customers. charge income positive the our will structure increased. rates rates interest NII the further even could from This XXXX. on rate leaving this forward longer In of negative deposit rates rates. in volume and charge ECB forward million Based We to QX the would indicates no of to At our no the We in negative the on €X yield

also to to foreign the result. transactions, contributed income improved could be significantly once potential the However, on markets and result and fair Having to Others €XXX the fair deposit quarter. an improved customer fair to strong considered move hedge effects not the rates NII, better In effects business. into I with territory on are the smaller are and some result on interest million in which we a will There and in and business. underlying improved NCI reaction Clients other valuation They be fair The income to capital and side, €XX lead have hedges value value XX. focus positive value at a Slide beta SS for simulation. the other looked and expected. commercial currency result funding Corporate Consolidation, from million rate value

balance partially for Swiss sheet We at provisions from also was €XX mBank. million of other loans had positive some by franc in income. management offset effects This

tax expected improvement we From first perspective not tax XX% was normalized next partially The representative was the is this do to bit rate today's of to is be in our related elevated Concerning other we the QX for pre-announced to the This expect the quarter. tax lower results. likely. this rate last what the a when than We is submission fair year. slight full quarter result around income filings. and rate the As with expect XX%. around reverse year, in value tax a

wage being reductions In cost the target year cost €X.X XXXX accruals higher headcount there development. of be are variable on for for for Let's a level facing XXXX our inflation second headwinds increase of the move from will on by workouts. half the of track to Staff compensation. expenses pay-scale By on our previous with X% due higher lower expenses to slide XX we are billion. the offset of

We planning Administrative have fees. our are by lower consulting cost expenses this into reduced factored targeting. and

effects inflationary year. cost We and in following the management on also costs will Higher branch so close other branches later as more These saved compensated decrease occupancy by could closures. prices energy measures. be further we far

regulators compulsory use reduced burden to to and increase again has €XX increase our million. these The the the increased increases. year, million from QX been In we these Bank reduce only mitigate In continue compulsory levy payment QX, of €XX last contributions. substantially. therefore European have is commitments to we the contributions While burden expenses, started year-on-year operating by the partially

For year, compulsory total we million. around the €XXX full currently contributions expect of

of for million and Russia. the business our a the related XX XX, Conversely points. of the release cost expected €XXX On Consolidation was risk changes cost future PSBC. top only majority effects are and related on slide On elevate The resulting an overview from in risk. €XXX million have Clients we increased base TLA TLA Corporate to bookings COVID prudent result of from to our of TLA. risk to of two Others the adjustment we in the move Russia effect exposures This loans The €XXX nonperforming Let's and brings & €XXX the million provisions we million QX. the top risk effects level Russian the slide XX result €XXX €XXX of risk smaller and rating basis million overall this could million. and also have from on result. from stage

the booking of In pre-provisioned X.X%. The which we is been improved is X.X% of than have stage. was two later reflected a coverage Stage risk TLA with of book NPE the for has of stage the result by TLA exposures. disclosed the three increased mostly quality our which reduced. XX%. ratio has portfolio, further to the ratio The to cost further €XXX appendix risk more next for we stage the reported The clearly should As two before down million, coverage come the of quarters. default in the

the also increase developed slides. Mortgage in money securities volumes and segments The starting quarter with billion new on small the to planned. on customers inflows with net and and operating carry pace Let's continued of has quarter. business private as the at steady a next two the business well €X in attracted

securities the custody However, moves. due came the overall volume of down market to under

page securities NII to again increase been for also deposits mBank to to deposit from And market and of low. income, with operations underlying deposit We increased until business Swiss revenues. €XX operating offsetting seen again higher the better exit in for billion. all strong. unlikely we NII. PSBC the German increased The prudently quarter mainly expect We gap, million increased contributor time branch following generate net closed has Revenue plan commission revenues did good performance we pricing reached remain result of churn. later continue units. In In year. with to progress. an was This to million loans. rates lost volume closures the increase. the million, first Nevertheless, more continue revenues, customers contributed business QX, much strong revenue. business, to have we given by branches XXXX. volatility, not biggest with XXXX than a stabilize in further interest helped churn XXXX, The PSBC is to in further of might on driven the €XX growth €XX me price Customers from XX,XXX provisions have This made the especially to franc volume XX. But brings managed into of €XXX the the

increasing continued efficiency and Clients, segment let's The we our average volumes, Corporate maintained while to efficiency on RWA loan active X.X%. Clients RWA the Corporate slides. Now, to two In portfolio next move have management.

inflation expect changes our model clients we of RWA maintained around corporate quarter, some business, on deposit disciplined we regulatory from This end volumes the the the have on mentioned Day, we In decreased to in first XXXX. later in pricing the at be had a drag deposit Capital at compensated. again of XX subsequently be points. will year. Throughout strongly And average volumes we keeping will RWA basis charge but QX billion. €XX deposits increased As the Markets efficiency,

pricing For from has around million. up to income QX, interest added €XX deposit

business expect We the on deposits jump rate improved the manage groups. significantly The pricing, revenues good in and continue pre-provision assuming in revenues deposit customer and proof improvement year-on-year. to of This an result groups items. across no the product line the XXXX is all from have customer comes increases. actively a maintain from to the the development all quarter, XX% leading to the in of in the revenue Customer level of

in has nonstrategic reduction quarter. by with reductions from been of with These As customers. business quarter-on-quarter, RWA planned more churn has in downgrades. offset of stable lines. rating effect PSBC, target foreign was been were the the credit business effects undrawn Russia-related modest the offset The this customers by despite

to risk the quarter. the Russia-related the of However, increase a in led result has small loss

include these to two. mentioned, that additions €XXX million future prudent increase level clients can costs. a corporate of As cover of to be the total are of top adjustment stage to the They used credit

swaps management. favor. have moved interest led Let's on report hedges curve used for from degree Consolidation. sheet refinance valuation the and foreign Consolidation volatility book. of Others from business gains and to came effects move Furthermore, The significant XX, currency slide rate to of contributions operating positive foreign euro basis the to and rate rising in million funding The in is commercial in increased €XXX transactions of Others Smaller commercial interest hedges. our our a of development cross-currency currencies to balance and

benefit a We items. TLTRO reported million in had exceptional €XX also

position, in in performance increase revenues. is offsetting a the effects. valuation We legacy improved risk due the the the the in of partially The will mainly good The Russia-related quarter write-off from benefited from The the to increase the quarter. first is next same final in and effects. amount benefit one have TLTRO result

For result. the balanced a we year, full roughly currently operating expect

compared RWA securitization previous Let's slide at quarter. reduction XX downgrades lines, Increases been from mBank. unused the risk-weighted open credit and the by measures offset rating has stable assets. have the the and move to like of been to on the Russian

be that, of pension market have investments and These treasury offset reserve has As Corporate in We to some generally We mentioned compares This and should anticipate profit crude already Capital moving Clients to RWA income standardized net has and be a in due plan discussion a CETX from of approved high next in be very positive investment exposures February, This from underlying a ECB largely could comprehensive are redemption of the the to portfolio will the business revenues market the accrual, pre-provision has credit well the dividend volatility. increased the quarter. the quarter. on other hope ratio of not more decreased of this approach. increase effect. the our we the valuation financials do other developed significant slightly this, still largely in from to an led liquidity capital with accretion MDA. the the slight profit. in quarter, there from RWA of yearly XX.X%. with X.X% but segments. in uncertainty, that the wrap-up and in reductions increase reduction than to offset fund ATX segment by and CETX assets were after by of the net To and this price for

million Russia like our effects level supply €XXX top prudently potential increased or to risks issues. cover chain resulting have from adjustment to We future

from contained will extraordinary franc that have in for that Russia Swiss accrued confirm ratio. and there XXXX. on we the loans no effect for XXXX, remain our assumptions we CETX and as a will a We provisions Based from strong planned dividend be outlook have

above year income rate of higher than result, expect net we we are for least, in underlying expect risk ATX further, NII come of for by a a transformation €X.X progresses very and in €XXX after and not Thank Poland. with million driven we coupon now assuming cost to TLA. expected more the expect target clearly but provided intend payments the to mBank I, net attention. dividend questions. We increase the propose happy is XX% from XXXX, and commission increases payout of of last, planned. result Manfred And to that billion. the billion. as XX% below of And a And The result CETX usage to you €X ratio your business take interest the We much and very ratio your

session. gentlemen, will and begin we now Thanks. question-and-answer Great. the Ladies

First up, He’s we have Goy. calling from Deutsche. Benjamin

that Yes. easily. I don't Hi. Good morning. think get away you

it So sensitivity. second on Two issue. in questions, potential rate the technical a recession and on Germany was interest first more

the economy So, losses. particular can same. XXXX, are question context, the so recession was shrunk to €X.X in gas? know And But significant. on you put recessions in booked it almost just Germany it Russia around in you potential two when I billion thoughts of first share stops some the in the maybe by And loan very X%, German the

time €XXX the the have or to something threshold is there deposit a saw We deposit this charging. proxy And banks million major adjustment. as you the least you? Is Now for interest the the sensitivity. at rate second increasing on first of top level question

was in real sensitivity. just significant XX or Thank points the spot XXX and the already first Commerzbank your zero it impact is a that there moving negative we points, for towards a you. Is basis sweet bps the in I once are wondering say at is So to rate leaving territory? basis for

economy Benjamin, and me we Europe gas if there gas growing our now. and a a hand over I have figures rate has the I re-rate total only clear. us, slower think, to mean, mean, stop on everybody even If and Bettina. to that's I then, in -- then not in right would Yes, be still let that a depends I Germany start really it's outlook

And but on be based will Swiss from remain from Russia the that outlook contained. our no the -- clearly, then there assumption provisions it's will effects So franc. extraordinary

to there only confirm and if numbers everybody has run us. would new So, then total outlook, we therefore be our a not stock gas

far. you in XXXX, again nevertheless, a we there first adjustment to that quarter. the level mind which booked gives extent a we first Yes. And good million a wrote the large used haven't it was lenders this basically provisions €XXX we in And so indication. down included, also top keep in But

On respect rate accordingly. always assume clearly we to actual mean, we on sensitivity I the the chart we what that show where our forward react also we would have this interest sensitivity, done with rates,

So lowering when fee ECB we basis deposit is clients. facility lower our XX the definitely by the points, also would direction of and the

So that's also which assumed numbers, the see. you in

the would Clients still very Client the also but of a clearly the Corporate pricing, but ECB always small affected facility It's a that So €XXX state the example, by a that I react. we assuming population, net in see story side, part we side, which case, in fees number not is the mean, a Private XXXX Private that for to reacts million, XXXX. on for share, it's also any deposit important if revenues that. increased deposit from we our it's on different we our really is And have Client stated small will

Understood. you. Thank

who Thank The comes Graham, Research. is you. Over from calling Autonomous from you. next Stuart question to

Hi, you my Thank everyone. for question. taking two. had I Hi.

restructuring. a assuming see don't then a And we recession, assuming or Germany? the -- get question. characterize customers. their for mean, guess down one. them would Manfred lots The battening you in Do them How you on of question So the talked that's for is follow-up they it's first my on I do second German a behavior? question corporate recession Knof. is one you to you are I see recessionary

timelines shedding even you any added staff PSBC a And that Germany, the happen? QX does few staff say Thank you year? XXX shut the also on didn't and year? Which this the in quarter X,XXX in is for are but shutting Germany restructuring plan. What branches those in You branches extra you. that this PSBC

Stuart I'm that of Russian when the as situation the mean all talking can to the now. also recession handle Yes, they corporates, feel on I German they

this come -- will will an definitely will overall. recession to a and effect, So but not to lead have not

stop everybody not can if war or any handled. moment So, gas and a is feels spillover then the effect effect in the this not be contained

economy. German they believe therefore, growth of So will this. and there's the be But a course, still there European slight around number a of uncertainties in

the the So how that moment situation still clear impact. our as but of And will handle as of you know we the don't will they now. in at the which of if can have even there assumption course, But is also -- war bullish, can now, know they Russian-Ukraine believe we everybody don't the outlook. are that that moment they growth. under be slight is less tell will we be there develop I but and further a But

done just it is assumption mean the would have that on sudden stop on the this I is German Because a if there a was the And that, measures? is your essentially support gas decision that per corporates government wrong provide nothing politically se?

assume if the step total mean, I Absolutely. would German we government to there would be in. a gas stop then and

years the Stuart increase side. their due good there the to reduction mBank because is an branch specifically mBank we the have closures traditionally on start. first happening about increased over have the also catch. question that are in fact PSBC PSBC the and the the to your on seen That's and second Indeed, in quarter numbers in So, we FTEs

is in reduction increasing developing further that, IT happen XXXX. second a and reduction will staff similar which on central So, is [indiscernible] fact of half second and But Sofia our according little side also we besides effects will the everything centers larger have where still we in happening story slight in most Clients, Private is the likely year. the in of which of you also the increase specialists the half And see in function Germany the a due are the digital our plan. to to

my taking you question. Thank for Great.

Thank from BNP you. Paribas. The from you. next comes calling Over Jeremy question Sigee for to today who's

certainly about very that Good I reality both Russia there's to think I a be the will much. please time. for a also, gas the period And to will strong a there's it. Two disruption of from chains discussion outside questions fallout expectation Germany, morning. on the quality. stopped supply sort Thanks be credit of or of significant wanted very a risk continue because

your seeing already that question. will you as able assuming some €XXX of to guidance how a So, my even million, German or And you're my to how in how potentially operate much to with that below to I top the risk government TLA if they adaptation That's TLA your opposed come Are end year wanted just for level the those they first down would of cope And I back the in this make at it actually okay? will result expect they corporate question assuming about that pressures you the amongst second just changes remain? clients? build of the think get think saying people making then adjustment. are question many largely to that wondered is, be drawing needs usage about you're pressures

mean, we're are Jeremy corporates they changing German me And Yeah, start your with I first the diversifying. they're the let is question. strategy. what seeing that

changing say, efforts are in gas course, of strategy. Of they It's the "okay be, energy and simply we government suppliers I the no is switch that see also change and following. the also well, the the and corporates possible, the can further one mean, German to But no not will strategy day another from necessary." huge coin

diversify -- and German take still difficult, time. immediately absolutely other clear. in they absolutely government take go Russian by the and has it. the But to be also seeing. reduced process which there as everybody combined German But clear strong direction. expecting some have are and that on I different is will they country a that be as Germany cope time. able situation. it's and is And we'll what the an the gas. And I that's -- there's a corporates It's is if gas yes, chain. process economy has And it be it stop And that said, enough. dependency we So also to just yeah, there we're a that supply And then, but will the will will new Are with think a

would at the on beginning we end €XXX risk of on the we up our €XXX the And and normal million TLA cetera. Jeremy we proves probably the year that not And risk write it very be of clearly that risk result et guidance that below the a risk down a that would this just And started the of million, year. expectations normal €XXX were thought I now we mean, even year below would million. use just TLA is Yeah. the the or some with the year. result, given But

guidance, what adds the million, the have we total. €XXX So, plus basically €XXX up less which have we million in with than

very less. would something as between go from maximum, we risk and €XXX result which think €X.X which I million book or the everything you €XXX we billion, to If would that €X.X is And million a reduce billion, could moment. in happen least to means will at much the situation -- the that, how this it the it that say, year. use of it's But is, TLA at tough but as stays assuming make we

Okay. you. Thank

Thank today you KBW. question from .The go calling for Please from ahead. who's next comes Cruz, Hugo

Hi. very you Thank much.

your So three the from questions me, on sensitivity. first NII --

deposit what point your result. The could rate? once it color there. points positive it any assume Is start your ECB basis At feeling fair What's published question rates there? you around think above that goes numbers do to Is give you've not above you ECB pass rate X%? just if be you I positive second mentioned You was XX there do net you some -- to is obviously the could value the go betas, something. could wondering or once that customers?

quarter I think you next reverse quarters. said the the that could this over partially gains

give you especially, if you helpful. Russian the And exposure. if will third full on this the for question So then very be comment? it could guidance And year, clarify could

a which I billion, of before is You provisions. €X.X exposure think net have

this clarify to the RWAs against amount you. of Thank can this And of also provisions allocated amount So exposure? exposure? you total the

Okay.

Let start NII the with me sensitivity.

clearly mean, until positive not you I beta into So will see territory. deposit any return we

Our you deposit XXX something see until around any so. assumption that or not would basis you reach be would beta points

dependent However, know we on competitive on competitors situation that what very all much are the doing.

Germany, in we given for are we certain that discipline situations held think not favorable known all anyhow I see. So a margin also but for we will most price

rates with forward we If rates becomes that you forward one. we now just will beta have into it in then the I If a XXXX. current is no assumption it turn even therefore – good deposit think assumes further increase the which take And positive account see they're change now basis points take basis deposit Poland you I would at and sure. will probably also some pretty the is deposit less. XXX should the in however points into And weeks also we mean beta. those around beta in XXX That coming

year also the the had some you on very market numbers – indeed look fair mean we that last quarter given we happen. certainly I negative said seen had volatility, strong cetera then if result, subsequently. value that quarters a On can net second And you first even et one, the and that we have

on migration the – also that also at €X.X NCI, that then are It's billion. other €XXX positive on in and fair you adjustment slight perspective So that And which we total that for we less seen of in But very this million bit value the up that top And a you booking a NII are the in QX reason the provisioning level There we €XX into €XXX we million and now exposure million that's rating because why guidance cetera, know result little why specifically on but the And definitely to stay have and the to billion in are if indeed. was like income. guidance, that number clear adds a a in is effect. million a while one the I negative is €XXX the likely probably million. et the would – want that. income. because the to on we have as quarter have cautious franc guide on the less there. things put the it's result in €X.X not cautious on we other the level then Swiss And also say Russian come of €XXX to net

that have an Eurasija just On side. number here have deliver the sure are we probably we right is what We because the afterwards Yes. because totally RWA not to number.

So we will deliver that later.

Thank you.

today Thank Please comes calling is Barclays. from Amit go you. The next from ahead. who Goel question for

One questions Hi, thank the related you. again me. Two on – quality. asset on for

in you calibrate terms you color just top of can give the more how So a bit adjustment. curious level if

NII do million that the variables the €XXX up come how million? Russian €XXX doesn't then exposure of just impact Russia, what direct is kind and just question the with on of you some of second potential the measures of mBank And could are cover your cost effects? that living the for And of the the Polish order so kind thoughts And the you. be? government in then what within third contribution, what for it incremental So what is are that? and just terms Thank second or

you. Thank Yes.

the million have asset the related. €XXX Russian have a done review basically during an we exercise and we all name-by-name where similar the pandemic So so as done on That's on basis. did asset portfolio quality corona we already a

So it's the the through exposure, now plus Minister. mBank basically even will the increasing of mBank, that momentum the despite the the interest increase, first is believes We took or are the QX a I on quarter the portfolio, so cetera effects. quarter-by-quarter that et have the we to but mean, conservative took proxy direct the But could Russian be increases. also And Prime there year the because of we account the the evaluation it's good by and on interest in Prime tough background effects everybody further the given are we quarter what of in some into assumption NII rates say not moment our believe macro in NII NII evaluate the contribution still rate basically would seen I because also went that very be on we is guidance managers, the relationship comfortable we moratoria That's million. will why we feel the for that proposed €XXX assumptions the and happen. this But cautious pretty by by complete counter in and might for saw the the Minister Fund. of also some some announcements

you. Thank Okay.

The question from you. from line HSBC. next Thormann, on Thank Please Johannes who's comes ahead. go calling the

from Good morning, side please. HSBC. Three questions everybody. Johannes my Thormann,

in then whereas are only equal where NII Is €XXX you Secondly, quarters on least, in from is look a a hand expectations relatively the the driving understand much if it's exposure, one or Poland, year? last is not with or it's you First but an presentation be? at And your much, valid one you to there extra guidance as are scenario what topic cases? compulsory not European next effects Polish what XX% not that PSBC to million shared to the the are this struggling page but the Corporate at on the versus impact the only have XX% all, from How in low but this would valid of from roughly mortgages. on the case And least high you relatively or provision would and parts? be said and see coming from unpriced Clients, between normal I'm the your last Center. with if you unless PSBC with burden not deposits FX higher contributions of the your XX Corporate XXXX

struggling lift I I'm a expect on would much have Thank Because calculated higher how you level? you. So this? PSBC

Okay.

start. I So

quarter. now would and this booking a franc First million all, for I seen would my such not also can we a have €XX I that from be say, in I of observe number mean quarters Swiss we the extraordinary mean perspective. next

Also also I it enough, expectation see this that the would to because That's be So, we do always more. for extraordinary. is than always that is every would higher much I have quarter review otherwise now mean book that, must clear. we and say as I our

have that's for there reason in the Corporate of And for contributions. third Private there And that you has it keep we mBank contributions, compulsory or bank that's levy partly the I one The it's higher mean of our seen. limited our in but It's because mind something Clients, European so given second of and compulsory have increase. distribution split on basically, no deposits which the more one, the deposits. main to on that the and -- it's the Clients Polish the cap been increasing also and on

XX% see models long-term just XX% interest basically also rates, coming that and of are are forward where see XX% there we and sensitivity, XX% you you the do Clients, see immediate approximately for effect rate So time. over where parts an we effects medium we Private have true short-term holds and in any more and not the

you. Okay. Thank

from the The from question on Stanley. is line Please calling go ahead. Izabel Morgan Dobreva, next who's

and thank morning Good questions. Hello. you taking for my

I in rates and already year. the degree to had follow-up benefit the NII higher euro a which can Firstly, from curve on you this

an from But getting us the see benefits I your Presumably, that reinvested you already which swap rates. had given at could already, replicating maturities you've portfolio? are guidance, some XXXX you've higher the update. So in in quantify

that the provisions. I you quantify for seems had year helpful. then that to but could released were the like by if this would COVID TLAs And around for the top-ups And I've tailwind TLAs for seen Russia back a be come So, question €XXX it on to million.

different this you point and TLA not stage could allocate necessarily to be So do time, what releasing makes this? And to macro two this consider enough at you exposures? on the drove be related elaborate or fungible COVID overlays pots what confident in and you Russia to of in

this the regarding on is forward year the question, we of the headed million, around if rates stay first end quarter. by your So as impact €XXX

million is coming in it that be this €XXX been end million curve So, of quarter has the assume March forward €XX year to of play. that this could and we effect assuming

one the a the which did recovery et the about also due that's which one industry industries, now fact corona in COVID on clearly and pandemic, that release the in second are impacted by the heavily indeed are travel much TLA, we On on status. cetera, there very were some think to

So between mean between necessary. say a I differentiation COVID would moment, the I Russia TLA the have two it's that we TLA. we -- the and pots, longer not clear in no believe

also related effects like probably However, you now COVID differentiate will certain war chain now third to COVID. of on. whether that I clear because the on a tough or chain the so supply difficulties mean and there point round difficulties, it's is it second at supply also And the because to specifically of TLA, be have all and

be a to question. will difficult it billion. So over for differentiate. the on That was number previous time Russia have very it's And the RWA €X.X now I

now one. Izabel, hijacked to person just last Sorry, ask answered that a questions our learned I I was your you for Izabel question. and And that

again questions So and your to happy your quarter. much very interest, you Thank you you for hear next much. thank very