A very good morning from sunny Helsinki and welcome to Mandatum's Q1 audiocast. I am Lotta Borgström from Investor Relations, and I am pleased to be joined by our CEO Petri Niemisvirta and CFO Matti Ahokas who will guide you through today's results.

During this audiocast, we will begin by presenting the highlights and key developments of Mandatum's first quarter of 2026. Following this, we will proceed to the Q&A session where you will have the opportunity to dial in with any questions you may have.

Participants can also submit questions through the chat, which we will review within the given timeframe after the dial-in Q&A. With these remarks, I will hand over to Petri.

Please go ahead.

Thank you, Lotta, and now let me walk you through our first quarter of 2026. The start of the year was good in our core businesses, even though the reported result was clearly impacted by changes in interest rates and our discount rate curve.

Market sentiment was mixed in the first quarter. Geopolitical tensions, especially in the Middle East, affected the markets.

Uncertainty increased towards the end of the quarter, resulting in a decline in our assets under management in March. However, market confidence has mostly recovered since then.

Our capital-light business continued to develop very well. Capital-light profit before taxes increased by 35% year on year to €26.8 million.

This shows that our strategy is working and that we continue to grow in the right areas. The fee result increased by 10% year on year to €20.6 million.

The growth was supported by higher client assets under management and good client activity. Client assets under management increased by 10% year on year to €15.4 billion.

Net flow remained strong at €248 million, which shows that our clients continue to trust us and invest with us also in more uncertain market environment. It also shows that our sales perform well in different market conditions.

At the same time, our operational efficiency continue to improve. The cost-income ratio decreased to 49% year on year, which is a clear indication that our business model is scalable and that we can grow income faster than costs.

The reported profit before taxes in the quarter was negative at -€25.9 million. This was mainly due to a more technical change in discount rate curve, which had a negative one-off impact of €30 €36 million on the net finance result and the group profit.

Excluding the impact, our underlying profit before taxes was positive at €10.3 million, which was weighted down by net finance result mainly due to the low investment returns during the quarter. As we have said before, these items can cause volatility in our reported earnings from quarter to quarter.

Our solvency position saw a strong increase to 203% during the quarter as a result of the sale of Saxo Bank shares. This gives us a solid foundation for our business and for future shareholder distributions.

Overall, the first quarter shows once again that our underlying business is developing well, our operations are processing as planned, and that the quality of the result is moving in the right direction. Let me then move onto the client assets under management and net flow.

Client assets under management reached €15.4 billion at the end of the quarter. The year-on-year growth of 10% was supported by strong net flow as well as the market.

A strong net flow of €248 million increased assets under management also from the begin of the year despite negative market movement. When we look at the different business areas, Asset and Wealth Management continue to grow steadily supported by both private wealth clients and institutions.

Corporate net flow also remained strong, with good sales especially in personnel funds. Retail net flow was stable, and we continue to see good customer activity especially in our Pohjantähti distribution partnership.

Overall, the development shows that we are able to generate positive net flows across all market conditions and across all our key customer segments. In Asset and Wealth Management, we continue to see solid growth.

Assets under management in this business area increased by 12% year on year. Growth was supported by positive net flow and good demand across our product offering.

Private Wealth Management continue to develop well. Assets grew by 17% year on year supported by strong sales of discretionary mandates.

International institutional assets also increased by 12% year on year. This shows that our international growth strategy continues to work and that we are able to attract new clients outside Finland.

It is good to know that international investment money moves quickly. When markets are uncertain, this usually leads to more outflows and delayed investment decisions.

On the other hand, when situation improves, money often comes back quickly. When looking at products, most of the net flow was directed to allocation products.

We also continue to see good demand for credit products, which remain an important part of our offering. Overall, the development in Asset and Wealth Management supports our long-term vision of being the fastest-growing asset and wealth manager in the Nordics.

Finally, a few words on profitability and efficiency. Our cost-income ratio improved further year on year and is now 49% on a rolling 12-month basis.

This shows that our focus on cost efficiency is delivering results. At the same time, we have made growth investments in asset management and corporate sales, such as new customer interface software and new requirements.

Yet, our cost-to-income ratio has remained stable as we have improved efficiency in other areas. At the same time, the fee margin decreased slightly to 1.12%.

This was mainly due to the changes in the business mix as the share of lower-margin Asset and Wealth Management business continues to grow. It is important to note that our underlying product margins remain stable.

This means that we continue to have good pricing discipline. Overall, we are seeing clear evidence that our business is scalable.

We are able to grow income, improve efficiency, and maintain profitability in our core businesses. I will now hand over to Matti who will go through the finances in more detail.

Thank you, Petri. Let's now take a closer look at the first-quarter result component.

The fee result was up 10% year on year with assets under management up by a similar amount. The fee result is down slightly compared to Q4 as in Q1 fee expenses have increased due to the growth investment within the capital-light area.

Also, there's some seasonality due to the timing of sales commissions mainly in the corporate and and retail segments. Of course, as the day count is is lower in in Q4 sorry in Q1.

Compared to Q4, our AUM was up by 1% or €100 million to €15.4 billion. As we all know, March was a turbulent month in the financial markets with negative returns, but we're still able to grow the AUM sequentially.

Note that the market development has been clearly positive in April-May, AUM has recovered nicely. As Petri mentioned, the cost-income ratio of our client AUM was 49% unchanged quarter on quarter.

Although our income was up, the increased FTE and IT investments in the capital-light business meant that costs in this area increased as well, and this is very much in line with our business plan. It's worth noting that the overall cost control remains good.

Our group total cost-income ratio continued to improve and we're very much in line with our overall annual cost growth target of around 1% until 2028 that we published at the CMD last June. The net finance result was negative in Q1, and the main driver behind this was the discount rate assumption change that we announced earlier.

The mark-to-market return on our own investment portfolio was negative as well, and I'll talk a bit more about this later on. Our result related to risk policies at €6 million in Q1 was a significant improvement compared to last year.

As one of our key financial targets is to grow the capital-light profit before taxes by more than 10% annually by '28 compared to 2024. Looking at the first quarter, the reported profit before tax was €26.8 million or 35% growth versus Q1 '25.

Although we were a bit behind the target in 2025, we are now at an overall run rate well in line with our long-term growth target. If we then look at the different segments, Asset and Wealth Management profit grew by 20% year on year driven by a 16% jump on in the fee result.

Corporate saw a significant profitability increase as the result related to risk policies increased due to a higher CSM release and a favorable claims development. The retail segment grew as well although the fee result was negatively impacted by the AUM development as well as a lower insurance service result.

This was impacted by changes in assumption in the tax deductibility of voluntary individual pension contracts that will be the tax will be discontinued in tax benefit will be discontinued in 2027. Then taking a closer look at the net finance result, it was -€47 million and the earlier disclosed IFRS IFRS-related change in the discount rate assumptions had a negative one-off impact of €36 million.

Despite the positive start of the year, March was a negative month in the financial markets. The with-profit investment return in the quarter at -0.6% was clearly below the expected level.

Worth noting is that the development in Q2 has so far been more positive. Fixed income credit makes up 77% of our own investment portfolio.

In Q1, the return was negatively impacted by mark-to-market adjustments from higher rates and wider spreads. At the same time, the portfolio mark-to-market yield was up by 40 basis points in the quarter to 4.9% or significantly above the cost of liabilities.

This means that the investment returns should also improve going forward. Our equity portfolio had a weak quarter in Q1.

The legacy portfolio consisting mainly of Finnish illiquid small-cap names was down by 9%. However, our private credit portfolio has continued a positive trend and private equity returns were positive in the quarter as well, and both are seeing continued capital distributions.

The other part of the finance net finance result or discounting and cost of liability, as you also we saw market rates increase significantly in Q1. This had a €14 million positive discounting impact, but the impact was maybe a bit muted as the increase in the market rates was mainly in the shorter end of the yield curve where most of our fixed income assets also are.

As you all know, we announced a couple of weeks ago that we'll start using a new discount rate curve for our insurance liabilities. As you can see from the graph, the new rate is clearly lower in the long end and closer to externally observable swap rates and also more in line with industry standards.

Although the change resulted in a fairly large accounting impact in the quarter, it's important to note what Petri also said that this impact will be offset over time. It has no impact on our cash flow, solvency, nor dividend capacity.

We believe there's other benefits, as you can see from the from the slide as well, compared to the very volatile old IFRS curve that we used. We consistently continue to generate capital.

Organic capital generation was €50 million positive in Q1 despite the negative IFRS result. The strategic asset de-risking of the with-profit portfolio continues and and is expected to further support the capital release going forward.

Q1 was the second quarter in the history of Mandatum when the SCR from the with-profit business was smaller than the capital-light SCR. This also supports our transformation journey towards a high-ROE capital-light group.

The fully loaded group solvency ratio stood at 203% up from 169% in Q4 and is clearly above our target range. The main drivers behind this increase were the completion of the sale of the Saxo Bank shares and a lower symmetrical adjustment factor.

Finally, we paid back in March the €200 million loan that we used to finance the Saxo Bank shares, the financial leverage decreased to 17.5% from 23.8%. Now back to you, Lotta.

Thank you, Matti. Now let's move on to the Q&A.

Please dial in or submit your questions via the chat. If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue.

If you wish to withdraw your question, please dial pound key six on your telephone keypad.

Hi, thank you for taking my questions. I have potentially three questions.

The first one just on your investment results, and apologies if I missed this, but you have certain losses, or the miss was driven by movement in listed equities. Can you just help us understand what is the composition of the portfolio there and is it essentially something that you expect to recover relatively soon or is there something else going on there?

The second one just on Saxo Bank and dividends. Just trying to understand the dividends for the year.

Last year you upstream somewhere between €300 and €315 million combined from your life and asset management entities, but with the net €100 million from Saxo, how should we think about dividends for this year? Is it a special that we can expect or would you prefer to then just upstream lesser this time?

Then the third one was just on your fee margins. Could you help us understand how your fee margins compare to your competitors?

What you charge versus what competitors in the market are charging?

Great, I'll take the first two ones and Petri, if you take the last one. Hi, Vash.

Obviously, yeah, the equity portfolio of that we still have of around €100 million is very much a legacy portfolio consisting of fairly illiquid small-cap names. I think it's important to take also a bit of a longer-term view on this when we started our journey as a listed company, we had around €1.2 billion in equity, most of the liquid names have been sold.

As back in our capital market day, we've shown that we also have a clear path to have the kind of strategic asset allocation with around over 90% in fixed income instruments, and the alternative part should be gone. There's nothing funny going on.

The liquid small-cap names have been hit quite badly and they're quite illiquid, their positions are quite difficult to get around. That said, remember we're talking about a €100 million portfolio roughly, where the illiquid part is maybe half of it, and in the big scheme of things in our total even our own investment portfolio, this is a small thing.

Negative development in Q1 for sure, and the long-term solution is to get rid of this, but we, of course, are not selling it at any prices. Then regarding the dividend upstreaming, if we look at it, I think we've been very very clear on what we expect on things, and the Saxo Bank net €100 million is something that we did not pay out obviously in or is not part of the dividend proposal for 2025.

We have our AGM next week obviously, and then of course that means that is additional potential for the board to decide on the regarding the 2026 dividend. That is not included in the proposal as we mentioned in conjunction with the Q4 report.

Yes, and about the fee margins compared to other players in the market, of course in an effective market, it's hard to charge much more than any other player in the market. Having said that, once you have really good products like we have in high-yield side, especially our Nordic high yields, you might get some extra fee for that.

You have been the number one in that segment, but of course not that much. Investors are not willing to pay that much.

Having said that, why our margins are quite high compared to industries that we are in those asset classes where you traditionally can charge higher margins than in plain vanilla equity investments. It's more or less the areas of asset classes where we act and work.

Those are traditionally with higher margin levels than, for example, investment grade or government bonds and so on.

Maybe one could also add that if we look at the net flow that we also were able to produce in Q1, if the margins were significant different to our competitors, I don't think that would really work. The market is what it is, and that I think is important to note.

Got it. Thank you so much.

Yes. Good morning and thanks for taking my question.

I have two if I may. The first question is on the P&L this quarter and the fee result relating to investment services where you have the step down from Q4 to Q1.

I appreciate the comments that you had, Matti, and just kind of trying to dig into the growth investments into the asset-light business that you mentioned. Could you elaborate a little bit on that?

I see on your employee side that you have sort of four new employees in Mandatum Asset Management? Is that what you're speaking about?

Then the second question is on net flows this quarter, just looking at the personnel funds where you've established one new personnel fund this quarter versus you had I think 44 in total last year. How should we think about the kind of growth trajectory there for the rest of the year?

Is there any kind of seasonality here? Would you characterize one new personnel fund as sort of normal or could it in theory have been higher and therefore also higher net flows?

Those are my two questions.

Hi, Hans. I'll take the first, the kind of the fee result development, Petri can talk about what the investments in practice have been, but looking at the numbers, obviously there is volatility between quarters in terms of especially sales commissions which is affecting the retail and the corporate part both internally paid and externally paid.

Q4 was probably a bit low in the terms of sales commission and now Q1 is more on the normal side. Then as I mentioned, we did make a change in what we believe that the individual pension insurance policies customers will pay since the tax benefits will end now starting next year.

They will continue to pay, but we expect it's going to be a bit less than what we have estimated in our actuarial assumptions, so that also had a negative impact. This altogether was maybe around half a million in the retail segment altogether.

The investments we've made in the capital-light area.

Yes. Investments we have done in a capital-light area it's let's say two areas: people.

Last 6 to 8 months, we have recruited a little bit more than 10 people both in corporate segment and wealth management segment. Especially in wealth management segment really high-level people to support our growth in wealth and asset management side.

Of course, quite pricey in that sense. It's like in any other investments.

First, you do investment and it takes a while to get the benefits of that. We are living in some kind of transition time with those investments that we have invested, but not yet get that much back of that.

Of course, new people coming to new house, new products, and so it takes for a while to really get business going. Another area is investments to software supporting to our sales in both corporate and asset and wealth management side.

That's something we have also invested. Not very heavy investment, more like a support tools and not very expensive one, but investments anyway.

Those are the investments we have done, and in order to cover that because we are more or less during this strategy period, we have a plan and we have introduced that in last June that we are keeping our cost base more or less the same, only small growth in our cost base. What we have done in order to cover these investments, we have streamlined our operations in support functions.

In all in all, it's not that heavy investments in a group level. About the net flow and a personal funds, yes, there's only one personal fund, but it's seasonality.

It's the business goes so that during the Q1, Q2 especially, but also Q3, you build up the momentum for that. You have negotiations.

It's building up the new personal fund, it takes quite a while because it's all employees in the company. There's a certain regulatory framework how you can do that, it takes some time.

Q4 is the where you close those deal really. It's always so that Q4 is main part of the new deals during the year, and you try to close those before year-end in order to pay the bonuses in next spring to those personal funds.

It goes like that. One one closed personal fund doesn't tell anything about our activity really.

There's a huge activity behind it and there's a lot of prospects going on, and there will be a good year as well on that side. It's normally you close those in a latter part of the year.

How would you characterize the activity on the personal funds compared to last year? Is it sort of fair to assume that it's the same or?

It's more or less the same. Last 3, 4 years, it has been more or less the same amount of personal funds.

We have a little bit changed our way of working, we are concentrating a little bit bigger ones and not taking every personal fund because the legislation goes so that it has been that the requirement for how many employee company can establish personal fund has come down every second year, and now it's very small. I think it's 10 people only companies, and that means also that the size of the personal fund will stay very small in very long time.

We are a little bit concentrating more the bigger ones and to be very competitive on those cases.

It might be so that in number-wise, it will be the same or a little bit less, but money-wise, no changes compared to other years. That's our plan at least.

Got it. That's clear.

Just finally, is it then fair to assume that the majority of net flows is coming from the private wealth side? I take sort of your comments on the last question there.

Even though corporate, especially personal fund, net flow has been really good especially in H1 during the years, of course the fastest-growing area of our net flow and business and assets under management is coming from Asset and Wealth Management side. That will be the case this year as well.

Got it. Thank you very much for the answers.

That's all from my side.

Thank you.

Good morning. Just wondering about the unwinding rate for the year.

That's unchanged at €10 million per quarter as the first question. Then I was just wondering about the 60 bps mark-to-market yield increase in the original portfolio.

Just thinking about the unwinding rate next year, how much of that 60% 60 bps increase is spreads versus base rates?

Hi, Ulrik. Yes, you're correct that the unwinding rate for '26 is set and then next year we will have a different rate.

Of course, it depends on how the market rates move all together, it's too early to say exactly where we're going to end up. It's true that now last year we've seen a decrease in the mark-to-market yield as well as the discount rate.

Now with the kind of change we made, that's one one structural change, but then of course it depends also where the rates are going to be at the end of the year. I think it's fair to say that what we look at it is of course the spread between the mark-to-market yield and the discount rate, and that has improved a bit, and which is of course positive, and that's what is really driving the results.

The rate is not set for next year.

I'm just wondering because, yes, you definitely have a higher expectation for a result this year, but I was just wondering about bit of the long-term spread because I just noticed you took a bit surprisingly big loss on the fixed income portfolio. I'm thinking that was a lot of spreads.

I'm just trying to figure out the underlying spread between your liabilities and your assets.

I think there will be a small positive, but nothing dramatic. As we've said, it's around 200 basis point the spread, but of course that can move 10, 20 basis points to either direction from that side.

If you look at the kind of portfolio, of course, one of the main things if you look at in absolute terms, on the original portfolio, the fixed income portfolio had a negative €10 million mark-to-market impact. There you can see obviously what the kind of rest of the portfolio did.

Actually the positive discounting effect was, as I mentioned, probably a bit more muted given the fact that rates in the really long end didn't change that much even though they increased a lot in the short end. There are kind of hedge ratio because most of the assets are also there, they kind of offset each other.

Then just lastly, I was just wondering if you have an update on the de-risking of the portfolio. Do you think it will happen this year or is it more likely next year?

Of course, the biggest thing of that where we're in the portfolio, as you can see, is that the alternative weight is very high. There we have kind of three different asset classes.

We have the real estate portfolio, which has come down already, which around at the moment around €70-80 million. Then, of course, you have the private equity and private credit.

The private credit, as I mentioned, has been distributing capital all the time and is performing very well. Private equity is the big question mark, and I think there's kind of positive signs regarding that as well if you look at the portfolio.

I think we're quite constructive, but it's out of our hands, and I think hopefully we will start seeing things during the remainder of the year and then, of course, continue there as well. It's for sure no changes there, and I think we're pretty constructive on the remainder of the year.

All right, great. Thank you.

Hello. A few questions from my side.

Regarding your international sales, in this quarter, was it more from Central Europe or still from the Nordics?

Hi, Antti. It's Petri here.

It was more from the Nordics.

Okay. Okay.

Then, what about the private credit market? In US, it's pretty volatile, but not that much in Europe, but have you seen the US development to affect your clients' appetite for private credit products in Europe?

Nope, not really. Let's say so that they have a more deep conversation about this issue and the market as a whole, but once we have had those discussions and open up really how we are doing our private credit strategies, I would say that we haven't seen any loss of appetite to that asset class.

Then I would like to continue about the discounting. The €36 million loss that now booked, you will get it back.

I understand that, but what about the pace? Let's say that everything else, interest rate and everything else remains the same, how much would be the positive income impact of that in the coming years?

Can you give any kind of hint for that?

It's a very good question. Hi, Antti.

If you look at it, the maturity of the portfolio is very very long, and that means that so if it's €36 million, it won't be 10 years, might be 20 years or something like that, you can calculate what the impact. It's not huge, but that, of course, Remember, this is a discounted figure as well, it depends although so the interest rates, but probably a couple of million a year if you do the math that way.

That depends also Remember, The €36 million is a discounted figure, it depends also on the rate development, etc. It will take a long time to come back, but it will definitely come back.

That's all from my side. Thanks.

Hi, all. My first question is what was the new MAMCO fund included in the AUM at the end of Q1 at all, and when will this fully show in your AUM?

It was not, zero. As we have stated that we have already used some dry power because of the market changes, and that it has been a really good timing for us to collect that commitments and deploy the money.

In Q1, there is no net flow related to that. How it will come to our net flow, it's really difficult to say, but it comes at the speed that we invest the money and we call the money from investors.

It will take a while.

All right, yeah, that's clear. I just wanted to know if it's based on deployment.

Of course, it's clearly supporting our net flow in coming quarters.

Of course. You stated that fee profit from private clients was impacted negatively by the tax changes.

Could you clarify a bit what this means in practice?

What it means obviously is that in Finland now the tax benefits for individual pension savings, and this was announced already a year and a half ago, 2 years ago, will end starting '27, and we believe that this will impact that people will pay less premiums to their policies. Of course, that means that the CSM will be lower, and that's what we did this change now in Q1, and that actually also meant that the insurance service result coming from the CSM release was lower as well.

Nothing too dramatic, but yes, in one did have an impact on our numbers. Especially on the retail side, the sales commissions make a much bigger role, and especially in the beginning of the year, we make an assumption on how it was, and last year it was lower than maybe normal especially in Q4, so that kind of evened it out.

This is something the tax change was announced a long time ago, and we believe People will continue to pay in these policies, but probably a bit less than or somewhat less than with the tax benefit.

All right, the effect on your P&L is structural and not one-time expense.

That's correct. The CSM is lower, the CSM release will be lower in the retail area as well.

Especially, as I said, that this maybe is €500,000 in the quarter, all in all That change is one, but now we had the kind of more normal sales commissions, and that may vary during the quarters, which is kind of impacting the fee profit there.

All right. Fee result from investment and asset management services also decreased compared to Q4, which to me at least was a bit surprising given that your average AUM was higher.

Could you describe the relevant drivers behind this a bit more, for example how significant was the cost effect related to international expansion?

I think in international expansion less so, but in general the expansion did have an obviously impact as Petri very well described both in terms of IT and FTEs. Remember, however, that Q4 or Q1 is a shorter month in terms of day count that has an impact quite significant actually if you then do the math that there's 2 days less, so that had an impact as well and other items.

Those are probably the kind of items I would single out on that line.

In the income side no meaningful one-time items other than the day count, which of course is recurring year on year.

Correct.

That's it from me. Thank you very much.

Thank you.

Hi, it's Jaakko from SEB. Still a couple of questions left.

First one, follow-up on the international business. Petri, you mentioned that the money there is much more rapid in its moves.

Does this imply that you probably see a bit abnormal outflows during the quarter? I.e., how strong was the kind of a gross inflows overall during the quarter and should we expect based on what you said that the money could be returning during the second quarter already?

That's something of course we have noticed already during the previous quarter. Part of the money we are getting internationally outside of Finland is based on platforms and that kind of distribution channels, which we don't have the let's say deep connections or any connections to end client.

Once there's a turbulence in the market, money is not that sticky like it is if some pension fund has invested €10 million, €20 million after long decision-making process and a meeting our portfolio managers and so on. That kind of money it's more in and out in crisis situations, and that's what we are referring to.

Like you mentioned, it's also when the market normalize, it's comes back quite soon as well.

Good, thanks. Then on the strong risk result during the quarter, Petri, you already touched on the factors behind, but could you wrap up the kind of a key drivers for the strong Q1 level and should we continue to assume kind of a so-called normalized level a bit below what we saw now in Q1?

Yes, absolutely. If you look at it last year and we discussed this a year ago and also in Q2 that we believe that the risk result was lower than what you should expect for a couple of reasons, and now I think the CSM release is kind of on a normal level.

The claims development, however, was a bit more favorable, from the €6 million probably 1, 1 and a half million was kind of potentially recurring. We obviously don't know, it depends on the development.

I think we've kind of outlined on a run rate somewhere between €15-17 million could of course hopefully be better, but I think that's the best guess we still have at the moment. Kind of 4, 4 and a half, 5 per quarter is probably a good estimate here.

I think it's important to note that now there's no funnies here, this is a much more stable development. We've been still able to grow the CSM, it's not that we are releasing much more.

I think now it's kind of more normal development what you should expect going forward.

Excellent, thank you. Then final one, a bit technical.

On the net proceeds from the Saxo exit, where is this capital sitting? Should we assume that I assume that it's in the parent company and invested in short papers, and where should that small interest on that short papers be visible in your P&L?

Is it on the other row?

Very technical question indeed, Jaakko. It's other, it's where it stands, and you are correct that we got the €300 million a bit more, and then we repaid the €200 million loan, so that money is invested in fixed income short-term instruments.

That's clear. It's not visible in the with-profit segment.

Hi, thanks for taking my questions. Just one more maybe on the net flows.

If we look at your net flows during the last 12 months, would you say that you're happy with the current level as it has been decelerating a little bit over the last few quarters?

Yes, I would say of course as a CEO, I always want to have more, but having in mind the circumstances especially now in Q1, especially in March, I'm happy with our net flow also during last 12 months. Of course, once we have already discussed today, we have invested to our distribution in order to get more.

Of course, that's our target, and that we will like to see bigger net flows in coming months and coming years. Of course, it's also true that we have a bigger assets under management portfolio now, and there is a natural outflow also from your portfolio.

We have to run faster and we have to sell more in order to create the same amount of net flow, and of course our targets are higher than what we have seen in the past.

If I understand correctly, you're increasing investments and recruiting more people to in the long term accelerate further the net flow-driven growth.

Exactly.

That's all from me. Thank you.

Thank you.

Yes, thank you for taking my questions. I have two questions.

The first, sorry if I missed it, but can you maybe give a little bit more color on the dynamic of the organic capital generation in the quarter? Is there a normal quarterly run rate of capital generation maybe that then you can talk about?

This is the first question. The second question is about capital management.

You mentioned considering the level of solvency now you may do more in terms of distribution. Does it mean a higher dividend, or you're also contemplating share buybacks or special dividends?

How should we look at that? Thank you.

Yes, hi, Michele. Regarding the capital generation, of course there's two parts to it.

One of course is the capital-light profitability. That was maybe a bit higher than what you should expect going forward.

The capital-light profits were €27 million and it was €50 million positive all together. If you look at our kind of investor presentation, there was a €2 million negative impact from the with-profit portfolio, obviously the kind of capital release from the portfolio de-risking was zero to negative, and of course the IFRS results were negative as well.

Important to note, though, however, that the discount rate change has no impact on the OCG, so that also is important to kind of I think single out there. Overall, the OCG is driven by two factors: own funds generation and SCR.

Now the SCR especially in the retail segment went down because of first of all the symmetrical adjustment, but also the slightly lower AUM. That helped the situation all together.

The building blocks are capital-light profits and then with-profit profits, and then the own fund generation and the SCR, which typically would not be positive, but it was positive now in Q1. A bit more positive all together than one should expect.

At the same time, as you can see, the with-profit contribution was negative, so that should be actually positive there as well. Higher than the IFRS result typically, and then there's other moving factors all together.

I think the €50 million is probably a run rate slightly higher than maybe one should expect. As I mentioned also, the with-profit contribution was negative, and that's lower than what you should expect.

Thank you.

Then you were asking about the capital distributions. I think our board has been quite explicit that the current structure of dividends is the preferred way forward, and at least I haven't heard of any changes on that point.

We don't look at the dividends as extra or recurring. It's more what is driving it is the liquidity in the holding company.

Solvency is more than enough. Now, of course, as mentioned in the previous question, we do have a lot of cash in the holding company as well, and then the rest of the dividend capacity is coming from upstreaming dividends from the life company and the asset management company.

Those are the building blocks here all together. I think the board will decide then for '26 sometime in the beginning of '27.

Remember, our AGM is next week, we haven't even paid the dividend for '25 out yet, and that's going to happen next week.

Thank you.

That concludes today's audiocast. If you have any further questions, please feel free to reach out to us at Investor Relations.

Thank you for joining us today, and goodbye.