Erste Group Bank AG

Thomas Sommerauer – Head of Group IR Andreas Treichl – Chief Executive Officer Andreas Gottschling – Chief Risk Officer Gernot Mittendorfer – Chief Financial Officer

Pawel Dziedzic – Goldman Sachs Johan Ekblom – BofA Merrill Lynch Gabor Kemeny – Autonomous Hadrien de Belle – KBW Johannes Thormann – HSBC Alan Webborn – Societe Generale Riccardo Rovere – Mediobanca Marta Jezewska – Wood & Company Benjamin Goy – Deutsche Bank Rajesh Kumar – Societe Generale Stefan Maxian – RCB Maria Vasilenko – UBS

Thank you very much, Jeff, and good morning to all of you who are listening in. Today's call is about the first quarter of 2016 and will be hosted, as usual, by Andreas Treichl, CEO, Gernot Mittendorfer, CFO, and Andreas Gottschling, CRO of Erste Group.

They will lead you through a brief presentation giving you the highlights for Q1, after which time we are ready to take your questions. Before handing over to Andreas Treichl, I would like to point you to the disclaimer on page 2 of the presentation.

And with this, I will hand over to Andreas.

Thank you very much, Thomas. Good morning, ladies and gentlemen.

The first quarter in 2016 shows a net profit after tax of EUR275 million. The major items for the improved result vis-a-vis the first quarter of 2015 is, of course, a substantial reduction of risk costs by EUR127 million, or as the operating results were lower than in 2015, due to a small reduction in net interest income, lower fee and trading income and higher expenses.

However, if you look at the expense base in the first quarter of 2016, it included almost the entire deposit insurance for the full year of 2016, with EUR72 million versus only EUR19 million that was booked in the first quarter of 2015. Same, actually, if you look at the other result, which remained stable vis-a-vis the first quarter in 2015.

However, it also included a EUR10 million higher charge for the resolution fund, with a total of EUR65 million. Also, on that front, we booked the full-year charge into the first quarter.

Cost/income ratio, not a very nice development to 61.9%; however, very much influenced by booking the charges for the full year into the first quarter, so we should see that ratio improve throughout 2016. And then, of course, on a quarter-to-quarter or year-to-year basis, a very substantial drop in our risk cost.

If you look at the other results, bank levies are somewhat lower due to the reduction of the bank levy in Hungary, which is a positive, and we might expect some further reductions next year. This year will be pretty much at the same level as in 2015, the overall bank levies.

Return on equity stands at 9.8%. So, actually, looking at most of the cost of capital calculations, we have covered our cost of capital in the first quarter of this year.

And return on tangible equity improved to 11.3%. If you go to page 6, balance sheet, not much to be said.

0.7% loan growth, a total of EUR844 million, coming mainly from the Czech Republic and Austria. And if you look at the components, mainly mortgage lending, so no dramatic effect on the net interest margin since margins on mortgage lending are lower than in almost all other retail lending segments.

Same thing on the deposit side, pretty much the same development as last year, that loans and deposits grow at the same speed, which you can see on page 7, results in our loan-to-deposit ratio staying stable at below 100%. So our lending business is fully funded by customer deposits.

Risk-weighted assets remained flat and the NPL coverage improved to 66.5%. And we see another drop in the NPL ratio, from 7.1% at yearend to now 6.7%, and that ratio you will continue to see dropping throughout the year.

So the NPL ratio at the end of 2016 will look better even than in the first quarter of this year. Capitalization, the CET1 ratio, given that we do not include retained earnings in the first quarter, flat at 12%.

Tangible equity, however, increased to nearly EUR10 billion. Liquidity coverage ratio improved and leverage ratio flat, with a tendency to also improve throughout the year.

If we go to the business environment, actually, it's rather positive in our region. Practically all our countries are growing at a faster pace than the rest of Europe.

We expect that trend to continue throughout 2016 and 2017, my view also in the years thereafter. Positive for us, given the strong retail business that we have, that an increasing part of GDP growth is based on an increase in domestic demand, given that in our region a lot of people have real wage growth as opposed to most other countries in Europe.

The consumer price inflation is higher than in many other European parts, so actually in the Czech Republic they are not in the euro but they would make Mr. Draghi rejoice, because they have actually reached the inflation rate he would like to see.

And Romania is even doing a better job; they're getting to nearly 3% inflation. Unemployment rates are improving throughout the region with the exception of Austria, where you see a negative trend partially based on migration.

But in the meantime, the Czech Republic actually has taken leadership in the lowest unemployment rate, I think, in all of Europe. Current account balance, nothing much to report.

And if you look at public debt as a percentage of the GDP, Czech Republic, Slovakia, Romania very strong, Austria, Hungary, Croatia not so strong, but with a tendency to slightly improve. On page 10, interest rates remain at a historically low level.

Austria, Czech Republic and Slovakia partially in the negative territory if you look at government yields, but also in other countries, Romania, Hungary, you see interest rates on a downward trend.

On the market share side, where you saw a drop during the last quarters in some of our countries, that seems to be over, market shares are stabilizing and of course can also increase. We would like to see market shares on the lending side to increase slightly.

Our interest in gaining market share on the deposit side is very limited, however. If we look at the performance on page 14 and 15, which is loan stock and customer deposits, you see what I mentioned in the beginning, that we have a flat lending business in Romania, Slovakia, Hungary and Croatia.

Some segments, actually new volumes are growing strongly, but repayments have increased too, so net flat. And a slight increase in net loan volumes in Austria and in the Czech Republic, and they're mainly mortgage lending or corporate fleet.

On the deposit side, basically same story, flat with slight increases in the Czech Republic and in Austria. Net interest margin, if you look at the countries, you see that the only place where we really have a drop in the net interest margin tiers were in Romania, and in Hungary the trend reversed.

It dropped dramatically last year, of course also due to a dramatic change of the portfolio, but now it's picking up again. And on page 17, the operating income, basically you see rather stable in Slovakia, a slight pickup in Hungary and in Croatia.

And due to, of course, also the interchange fee story in the Czech Republic, a reduction of Czech Republic and a slight decline with the Austrian savings bank. I guess that's more or less it from the business performance, and I'd like to hand over to Andreas Gottschling now on the risk side.

And a very warm welcome from my side as well. The risk costs have shown to be benign for the first quarter, reflecting the improved year-on-year state in commercial real estate booked in EGI and better quarter-on-quarter performance in Croatia, Hungary and Slovakia.

The Sparkassen has shown an improvement at a low risk cost level on a quarter-on-quarter basis, but it remains to be seen whether this is not somewhat of a seasonal effect, as there is a tendency of a light first quarter in this sector if we look at the past experience. Two reasons why I would hesitate to call this a new normal yet is there is no corporate default of significance in the first quarter, which is a very rare situation, and also the inflows of the NPLs might be a little lower now, but there's nothing to justify the level of the risk costs booked in the first quarter so far.

Therefore, I would refrain from turning this into any kind of run rate. Turning to page 21, the NPL ratio improved on the back of a significant decrease in the stock of NPLs, some loan book growth, and it's not very likely to be the end of it yet, as the CEO mentioned.

There is another closing of two transactions expected in Q2, with a significant further decrease of the ratio. Then turning to page 22, the coverage level is at a comfortable level, above 60% across the board.

Historical lower levels that we saw in Hungary after the FX conversion and in Croatia some years ago has been remediated; they are now at the level across the Group. And with that, I hand over to the CFO.

Thank you.

Good morning also from my side. We continue on page 26.

As already mentioned, our loan-to-deposit ratio is stable at 98%, slight increase in customer lending and a slight increase in our total assets and total liabilities. If we looking at performing loans on page 27, we saw a 3.1% growth year on year and a EUR1.2 billion increase of performing loans quarter on quarter.

At the same time, I already mentioned the significant reduction in non-performing loans levels. We continue on page 29.

Our liquidity coverage ratio is at a very comfortable level, as we have seen it over the last couple of quarters. The geographical distribution and debtor type distribution, we see a continuation of the trends, and we see the liquidity buffers at very comfortable levels continuing.

This is just reflecting the parallel growth of customer loans and customer deposits. If we look at page 30, by customer type and product type, no significant change, continuation of the trend, and slight growth as we could see in the last couple of quarters.

Page 31, our own funding base, wholesale funding base, we have issued in the first quarter a covered bond of EUR750 million. Going forward, we will most likely take advantage of the LTRO II and cover through this means in the Central Bank our funding needs.

At the same time, you see continuous growth in sub debt and stable and slight growth in covered bonds. Interbank deposits, we saw a quarter-on-quarter increase during the year, a similar development, a smaller increase then on a quarterly basis.

Page 32, funding profile, no big changes. This year is the last year where we have above EUR3 billion funding retentions, and maturities are stretched out through our issuance activities.

In general, the maturity profile is reflecting valuations activities over the last couple of years. Page 33, we saw a stable risk-weighted assets development and credit risk and an increase quarter on quarter on the operational risk side.

This is driven by the up-drift through the conversions that were taking place in Hungary and Croatia and are what's causing this jump in the operational risk charge. Nevertheless, risk-weighted assets pretty flat, and this resulting in a Basel 3 fully loaded ratio of 12% at the end of first quarter.

This is not including first-quarter profits, but we've changed the treatment of the haircut in the AfS reserves, because from the latest ABA publication it's clear to us that our original haircut assumptions were too conservative, and this led to a stable CET1 ratio fully loaded in the first quarter 2016. And with this, I hand over to Andreas Treichl for the outlook and the conclusion.

Okay. If you look at the first quarter, there basically are four items worth mentioning.

One, the net interest income is slightly better than we expected. The fee income, however, is lower than we would have expected, and we're hopeful that we can reverse that trend this year.

If you look at the risk costs, they are lower than what we would expect the quarterly charges to be this year. And if you take operating expenses, they are higher than what we would expect the quarterly charges to be, due to the upfront booking of charges in the first quarter.

But all in all, there is nothing that happened in the first quarter that would make us to deviate from the outlook that we gave to you when we presented to you our full-year results for 2015. So, in short, with some diverting trends in some of the line items, overall, we see zero reason why we should change our outlook for 2016.

Therefore, we stick to the expected return on tangible equity of between 10% and 11% for 2016, allowing us to continue a dividend payout policy. Thank you very much.

That's our presentation and we're now ready to take any questions you have.

Good morning, everyone, and thank you for the presentation. I have three short questions.

The first one is on asset quality. So I think you mentioned previously that, political issues aside, we should expect a flat cost of risk or flattish cost of risk in 2016, and obviously performance in the first quarter was much better than that.

You mentioned we should not extrapolate the cost and probably that's fair, but could you give us some indication how do you think about run rate for this year given the trends that you are seeing in the first quarter? You mentioned in your report that you're seeing a better recovery rate and so on, on the existing NPLs.

The second question that I have is on fees. Obviously, you mentioned there's some additional pressure this quarter in particular on security business and payment services, but could you help us understand how much of the decline is seasonal and to what extent we should expect this pressure to continue this year?

And also, you mentioned that part of that decline you hope to recover throughout this year. Could you perhaps quantify how big portion do you have in mind?

And last question is on Austrian bank levy. Can you just update us on the potential impact of the changes that the Finance Ministry is now considering?

If you have any more clarity on the timing of those changes and scale, that would be very helpful. Thank you.

Maybe I can start with the last point. It's very, very clear that any remark from my side now on what I would expect the result of the negotiations with the Ministry of Finance would be negative to our cause, so I'd rather refrain from giving an answer to that for the moment.

Just let me say a few words on the fee side, and then I'll hand over to Andreas and Gernot. So one of the things that we are, of course, dealing with the most is trying to limit the inflow of retail, of deposits, and trying to convert as much as we can into asset management products that offer at a low risk level a return that is more attractive than what we could pay to our clients on the deposit side.

That's our main goal.

On the asset quality, we see the situation split in the following dimensions. With this ultra-loose monetary policy, it's a very strange situation in the commercial real estate and the large corporates in the sense that it's quite possible to get refinanced on loans if you shop around just about anywhere.

Therefore, you've got a situation where the large defaults that we did not see don't come completely unexpected. However, this is a situation which will not go on forever, especially in industries that have something to do with oil, given the oil price development.

On the retail side, you've got, of course, a slight improvement, but there the early indicators such as the 30-day and 60-day delinquencies are pretty much in line with our expectations, slightly improved, but nothing to give us an indication that we need to fundamentally change our run rate on the retail portion, which is still the most significant part of our portfolio. And this extends all the way to micros and small SMEs.

Therefore, I would hesitate to call this a new normal and give you an indication of the run rate. I'd also expect, given what I mentioned before, on the large corporate side, that there will be some developments in the course of the year and that just a few large chunks at this low level will make quite a percentage difference in the allocated provisions.

Thank you.

That's very clear. Thank you.

Just on asset quality, if I may continue, when you look at the last year versus this year, you mentioned that of course in 1Q there is seasonality but overall the trends are better than before. Is it fair to assume that if that continues, the cost of risk should be at least not higher or probably lower than in the last year?

Well, that is fair, and that is something that we currently would assume too, that we're definitely unlikely to be significantly higher than the costs last year. This is also with the disclaimer, of course, that there is no political interference with implicated credit risk costs such as a forced conversion that appears out of nowhere in this year.

That's very clear. Thank you.

Thank you very much. Just if we can stay or go back to the revenues a little bit, on the net interest income, I think last quarter you stated that in order to maintain flat NII you needed to grow your loan book by 4% or 5%.

Can you just give us an update? Do you still see the same headwinds from the lower reinvestment yield or is that gap shrinking?

And then you also commented that you will take advantage of the TLTRO II. Would you expect to see any positive financial impact from that?

Yes, the base line is still the same as the last quarter. And the TLTRO, if we can take advantage and get the benefits of negative refinancing, then it will have a positive impact.

But I think that most of the advantage will be given to the customers by the competition and I think we cannot exclude ourselves in going in a similar development.

So if we add that together with the loan growth you're seeing in Q1, the fact that we had fewer days in Q1, we should expect a pretty stable NII going forward?

Maybe just a quick follow-up. In Slovakia, you had very, very strong growth last year.

It appears that at least quarter on quarter it slowed down dramatically. Is that a new trend, or should we still expect pretty healthy growth there?

Thank you.

And just to follow up on credit quality, you mentioned you expect to complete two major NPL transactions I think in Q2. Do you see any significant P&L impact from this?

And also, staying with credit quality, in other Austria, in the other Austria segment, I guess this is related to CRE and real estate, you had a very decent risk cost performance. Can you give us a sense which geographies drove this improvement?

On the credit quality, you're correct with assuming that the other Austria part has to do with the commercial real estate. The number decrease actually reflects the activity in the last year to roll up or sell the EGI subsidiaries in countries where we don't have a bank and roll them up into the bank where we are present with a subsidiary bank.

And therefore, the conclusion of this activity has reduced the marginal outlay for EGI related loans significantly in the first quarter this year. On the NPL sales that will come to closure in Q2, with all likeliness, one of them was signed before Christmas.

So any P&L effect, and actually the P&L effect there was positive, was already included in the full-year results of the previous year. The other one was signed in the first quarter of this year, will also likely be closed in the second quarter and also had a positive P&L effect.

Thank you.

Thank you.

Hello. Thanks for the presentation.

I just wanted to follow up on this Czech fee and commission trend. We've seen since Q1 last year an 8% to 10% decline run rate, and it is continuing at this pace in the first quarter of 2016.

When and if are we going to see that this year? Do you expect a slowdown in the fee erosion in the Czech market?

That would be my only question. Thank you.

In Q3 this year, we expect the trend to reverse, actually.

Okay. Thank you.

Morning, everybody. Johannes Thormann, HSBC.

Three questions, first of all a follow-up one on the asset management. Have you any measures already planned for the reversal of fee income, probably also not only on asset management but also on foreign payment and so on, which could drive and return this business to positive growth?

Secondly, just a question on your capital, can we still expect the same effect in H1 as we've seen last year? And last but not least, do you have any US high-yield energy exposure?

Thank you.

On the US high-yield energy exposure, there we have nothing to speak about.

Okay.

The capital effect of the first quarter, if we've done a review of the numbers, would be 30 basis points. So the clean fully loaded CET1 ratio would be 12.3% at the end of the first quarter.

Okay.

We don't know whether we're going to do it, whether we do it always for the --

We will do it.

If we do it, then you will have the same effect as last year.

Okay. And then on the fee income, any program started or you want to just do it out of the running business?

We are trying to mitigate all the negative developments. But as we indicated already in the last two conference calls, an effect that we have seen in the Czech Republic, that the interchange fee has more or less imposed on us a reduction of 70% cannot be made up by additional business in other areas.

So when this base effect is coming in, that's the reason why in the third quarter we should see a stabilization in the Czech Republic, because third quarter last year was the first quarter where we were missing the interchange fee that historically we had. In addition, we are trying to grow our fee business and mitigate the negative effects here, because we have limited opportunities or zero opportunity on the deposits to make some money and create some additional income.

Okay. Thank you very much.

Hi. Good morning.

Thanks for the call. Now you know what it looks like, could you just update us on your view of the Romanian mortgage law and what you're doing in terms of how your business offering or, sorry, your offer's going to look like going forward and whether you feel that will have any impact on the underlying business?

Secondly, you commented that clearly what happens to the margin will depend on the mix of business, and I wondered whether you could give us some metrics in terms of what things like new sales of unsecured lending in the key markets are looking like. Because clearly in the first quarter it seems to be mainly mortgages that have given you some loan growth, but one of the things that you've talked about frequently is getting the Romanians to do more unsecured lending, the Czechs feeling more confident and so on.

Is there any evidence within the business that that area, that higher-margin area, is actually improving in terms of new sales? That would be interesting.

And then thirdly, a small point of detail, was there something specific in the Croatian cost of risk? Was that again just commercial real estate write-backs?

That would also be useful. Thank you.

On the Romanian mortgage directive, I think the datio in solutum that you're referring to, in which case we have, A, changed our offering in terms of what is the necessary equity and the conditions on which we finance. To reflect that, some of our competitors have done so too, because of the state guarantee and the program is of a different value now than it was before.

In terms of the impact as a one-off on us, this is within our risk cost budget. So there is nothing that this brings for this year that we can see which would require us to have some additional change in our risk cost there.

In terms of ..

I think in terms of how it would affect the loan volume, I guess in Romania you will definitely see mortgage lending coming down because we need to change pricing. And of course, loan-to-value requirements will increase dramatically, making it a lot more difficult for low income or young people to provide the necessary equity for lending.

So we don't expect that to have a positive effect on mortgage lending at all. What could happen in Romania, actually, is that given real wage increases and further reductions on the tax side actually will have somewhat negative effects on budget deficit development in Romania but positive effect on consumption.

We could see part or even more of the drop in mortgage lending being offset through consumer lending if we do a good job on that, and therefore that should have a positive effect on the margins. But loan growth overall, of course, will be somewhat lower, I expect.

And finally, the question regarding Croatia, you're right; this was the difference of the cleanup act in the fourth quarter versus the first quarter, mainly in commercial real estate but also some corporate.

And could you just come back on the unsecured lending new sales trends, please?

Overall in the Group or just in Romania?

As I said, it's growing a bit in Romania and in the Czech Republic. In Hungary, new volume is quite substantial, actually, but you don't see much of that through as repayments have accelerated also dramatically.

So there is a chance that later on this year we can see reasonable loan growth in most of our markets.

Okay. Thank you.

Last year, if I'm not mistaken, you paid a big payout of 25%, kind of 25%. Consensus 10 days ago was going for, over the next three years, anywhere in the region of 30% payout for Erste.

But given that you are already above the requirement including the full phasing of the systemic buffer of the 200 basis points, how should we think about your payout ratio in the coming years? Is there any risk out of that that could prevent you from going well above what you paid last year in the foreseeable future?

This is the first question.

Okay. Let me start with that.

First of all, the numbers was higher. It was EUR730 million that we booked last year, not EUR660 million.

Number two, this was in the risk line and there was a significant portion booked in the other operating, which we mentioned because this had to do with the forced conversion and how these things have to be booked. This is similar to the Hungarian effect, which the accountants argued forwards and back between the risk lines over the quarters several times.

The total risk costs that we associated with risk last year were above EUR1 billion. They were about EUR1,037 million, if I recall right.

So with the risk guidance that we gave originally from EUR1 billion to EUR1,200 million, which we then modified from EUR900 million to EUR1,100 million, we were both times within the guidance. So we have to separate the issues between where we have to book it and whether it is intellectually risk cost.

I think we are now definitely lower, there's no doubt about it, from our expected outcome. But the comparison of EUR1,200 million to EUR600 million is somewhat out of range.

So that's it.

The reversal in trends is, as I mentioned earlier in the presentation, it's split in two ways. On the retail side, the trends and the forecasts that we have pretty well match up with what we see as inflows, as early delinquencies, and those are the best indicators that you have on these.

So I would expect that for 70% of the business at least, the running costs will be quite what we'd expect them from previous experience. On the large exposures, on large corporates and commercial real estate, I mentioned why it's a very volatile environment, with probably a few things to happen this year but not in a very conceivable, predictable fashion.

Now, with regard to the dividend payment, all we're saying is that we reaffirm our belief that we will pay a dividend also for 2016, but we're not mentioning what the payout ratio actually will be and I think that would be really premature. We now have the first-quarter results.

We will have in the summer, according to what we hear, a lot more clarification on future SREP ratio requirements. And we all expect that we will get, in addition to a core equity tier 1 ratio, a total capital ratio.

We hear some indications that the final SREP ratio will not be substantially different from what we saw last year.

It does, yes.

Okay. Thanks.

Good morning, everybody. Thank you for the presentation.

I have one question concerning the bank levy discussion in Austria. We've been hearing some government officials discussing it recently.

Could you share your thoughts about what can be the outlook and what is being discussed these days? Thank you.

Actually, I said that before. I'm surprised, but happy if government officials talk about it.

We don't want to talk about it for the moment, quite frankly, because I think it would be negative to our cost. We are in negotiations.

They are friendly. There could be a solution.

But since I'm leading those negotiations on the bank side, I have been specifically asked by my counterparties not to make any comment and I'd like to stick to that.

Okay. Thank you.

Yes. Good morning.

Benjamin Goy from Deutsche Bank. One question, please.

Obviously you have signed the two NPL sales in the last month, but I was wondering how you think about asset sales going forward given you would benefit from recovering markets and potentially see more releases in the loan loss line and also provide a better net interest income, so arguably of lower quality. Is there a change now as your asset quality is not really an issue any more and even Romania is below 20% NPL ratio?

Well, I don't think I would fix it to the ratio. I think it's more driven by what we consider core and going forward relevant, plus how fast can it be worked out on the recovery side.

You're perfectly right; the markets are pretty hot, both for the NPL sales but also for individual recoveries. At each individual sale and packaging, we're considering that tradeoff, and that's a matter of release the net present value of what we expect to recover through a sale much quicker than through the individual workout, where also the cycle might change.

But it's likely to have less speed in the future from now on than it is in the past two years. Thank you.

Okay. Thank you.

Hi. Good morning, all.

Just one question for me. Can you please provide some color on 2016 issuance plans, especially around AT1?

Last quarter, you said that you're still looking at market developments to get some clarity on your capital composition. Any update on that or is there any plan to issue AT1 any time soon?

Thank you.

Okay. Thank you.

Good morning. Thank you.

Three questions, if I may, one on OpEx. Last year you stated that in the first half of the year you might have some extra costs on the headquarter relocation and the double burden that you have still existing rents.

Could you roughly give us an indication how much is that in the first quarter? The second one, on the fee and commission, you have impact of interchange fees, and I assume in the Czech Republic.

And I assume you said the change of the trend or the trend reversal should be in 3Q. That would be the time when these interchange fees had been also booked, I think, last year for the first time.

Could you give us an indication how much these interchange fees are right now per quarter? And lastly, last time you said you expect a signing of Erste Bank Hungary and the acquisition of the government and EPRD probably on June 14.

Can you give us an update on that, especially having in mind last week's comments by the government being again a bit cautious in that direction? Thank you.

So the cost for the headquarter in the first quarter, the additional cost was EUR6 million. The missing revenues and the missing fee income from interchange fees in the Czech Republic is a little bit more than EUR30 million.

And so this is the resetting of the baseline, and the first quarter where we applied the low interchange fees was third quarter 2015. So you are right then that this negative impact should be disappearing.

And Austria is still positive about the football development on June 14.

Yes. But I guess what is very important for us now is that the deal will be signed before June 14.

Actually, it's very likely that it will be signed before June 14, because after the dramatic defeat of Hungary, they might be too upset to sign it.

Got it. Thank you.

Hello. Thank you very much for the presentation.

Actually, my questions were answered mainly. Just maybe some clarification on OpEx side.

Could you please tell me what is the exact amount of different deposits and other insurance fees planned for this year? And how do you see the development of your cost/income ratio in the coming quarters?

Thanks.

The total deposit fees for this year will be around EUR80 million, and we have booked in the first quarter of this year EUR71.7 million. So about EUR8 million left to be booked in the remainder of the year, whereas last year we had booked about EUR19 million in the first quarter.

Okay. Thank you.

Just a very brief follow-up question. I think I misunderstood.

Did you specifically link provision decline to NPL sales during this year, or that were two separate comments? Just for me to make sure.

Thank you.

Two separate comments.

Two separate comments. Okay.

Thank you.

All the best. Enjoy your jobs.