Macquarie Group Limited

Well, good morning, everyone, and welcome to Macquarie's first half 2024 result. Before we begin, I would like to acknowledge the traditional custodians of this land and pay our respects to their elders past, present and emerging. I'd also ask you to turn your mobile phones either to silent or turn them off at this stage. So this morning, you'll hear from our CEO, Shamara Wickramanayake, and our CFO, Alex Harvey. And with us here or online, we've got our group heads as well. At the end of the presentation, we'll have an opportunity for question and answer. With that, I'll hand over to Shamara. Thank you.

Sam and good morning and welcome everyone from me as well. So as usual, I'll just commence by touching on our business footprint across our four operating groups, which have been in place for a long time now. Across those four, as you know, they give us very good diversification in terms of the underlying thematics to which they're exposed. And all four of them are really well positioned for medium term structural growth with the areas they operate in. And those are our Australian Banking and Financial Services Group that is offering a customer experience focused digital banking offering here with a long runway to grow in home loans, business banking and wealth. And then our three global businesses, our asset manager in private markets and public investments, especially with a great real asset, franchise, which is growing a lot in this environment, especially our commodities and global markets, which operates across asset finance and financial markets and commodities, a long runway for that franchise to grow. And then Macquarie Capital, which is our advisory and capital solutions business growing in many regions, as well as bringing the Macquarie balance sheet alongside where we have deep expertise in debt and in equity. And they're supported by our four key central services groups across our risk management group, legal and governance, financial management and corporate operations. Now, turning to this most recent result for the half year, as you saw, we delivered a result of $1.415 billion, which was down 39%. on the prior comparable period last financial year and down 51% on the most recent half. And the return on equity was 8.7%. And given the change to the prior comparable period and the most recent one, I thought I might spend a moment on this next slide dwelling on some of the key drivers. And you can see that the operating group contribution as well was down 38%. on the prior comparable period. The key point I'd note is that the underlying franchise in all four of our businesses continued to grow through this period, and the contributors, there were three large contributors that I'll go through as I speak to each group, but starting with Macquarie Asset Management, you'll see as we go through the presentation that our underlying assets under management are up, equity under management in private markets and the public investments assets, And as a result, our base fees and our performance fees were broadly in line with the prior comparable period. The main contributor to the result being down substantially on the prior comparable period in Macquarie asset management was the timing of the realisation of assets in the green investments group, plus increase in operating expenses. But the prior comparable period, first half last year, we had some material realisations in our green investment assets because it was a very conducive period for realisation. In this first half, we are holding the bulk of those assets for a core renewable fund that we're launching in Macquarie Asset Management, which strategically is a big opportunity for Macquarie Asset Management to go into adjacent real asset businesses. And so important that we have this seed portfolio demonstrating our expertise to launch that well. In banking and financial services, the result was up and we continue to our underlying franchise growth, just like in man with the assets under management growing, the loan books are growing, the platform funds are growing, the deposits are growing. Operating expenses again up, and that's probably the second contributor to the change from the prior comparable period, as well as the timing of green investment realisations. It's that OPEX is up in all four groups. In BFS, we're investing a lot in technology and growing our platform and regulatory compliance. In Macquarie Capital, the franchise again continues to grow. The fee income is broadly in line. but the client base is growing there. And also, importantly, our private credit book continues to grow. So while, again, we had large equity realizations in the first half last year, you may recall the U.S. real estate asset pillar, the European Fiber Network on Avira, a conducive environment for realizations, this time less equity realizations, but more contribution from the annuity-style private credit investment income. And then commodities and global markets, the franchise there again continues to grow. So both in asset finance and financial markets, we had solid contribution. Commodities, you'll see in Alex's analysis, the client numbers continue to grow. The main reason the result was down was because we experienced greater volatility in the first half of last year, particularly in European gas and power and in resources across coal but also gold. This period was a much quieter period in terms of volatility in underlying commodities, but the important thing is the franchise continues to grow. So that was probably the third of the contributors, the timing of asset realisations, especially green assets in Macquarie Asset Management, the OPEX being up and the CGM less volatility in terms of the commodities. And similar contributors when you compare to the second half of last year, although the second half of last year, you may recall, had even greater volatility contribution to commodities and global markets. So with that, as you saw, operating income, profit, EPS, and also the dividend per share, which I'll talk about at the end, were down. Looking at some of the underlying drivers before going into the numbers group by group, assets under management were up 2%, and that was mostly through investments made in the private markets, managed funds, and favourable FX. offset by a reduction in some co-investment management rights, especially in a European situation, as well as the diversification by business lines and thematics. We're very diversified by region. We now have about two-thirds of our income generated outside of Australia, as you probably know, and the largest regions outside of Australia are North America, as you can see, or the Americas in this, and Europe, Middle East, and Africa. So turning then to looking at each of our four operating businesses, Macquarie Asset Management delivered $407 million. That was down 71% on the year, approximately $1.4 billion last year. As I said, big contributor to that being down with the timing of realisations in green energy assets. In the comparable period last half, Alex will take you through these numbers, we had about $800 million down. of realizations. And in this half, we just had the OPEX and DEVX that we absorbed while we hold those assets, which was about $100 million. So it's about a $900 million turnaround. The underlying business, as I said, the franchise continues to grow. Equity under management in private markets up 2%. Assets under management in public markets up 2%. We had raisings in this half year of about 8 billion. Basically, that's impacted by the lumpiness of what funds are open at the time. So the prior comparable period, we had a particularly large raising of 22 billion, and that was because we had our seventh European fund open, our third Asian fund, and our sixth US fund, the European and North American funds being the really big ones. In this period, we had a North American fund open for raising. We also, you may have seen, have announced that in our energy transition fund, which is newer technologies in the climate response, we've closed on about 1.7 billion US in October, so just after the half-year inclusion. We also invested comparable amount 7.8 billion and have 35.3 billion of dry powder in our private markets at the end of the period. So the underlying franchise continued to grow strongly in public investments. The main drivers there of the movements were the foreign exchange movements and net flows offset by market movements and you'll see there particularly equities, assets under management down 6% despite net flows, mostly impacted by market and also a rotation of the market to fixed income where we were up, sorry, equities were down 3%, fixed income up 6%. with flows to that region globally. Then turning to banking and financial services, the result there was up 10%, $638 million from what I recall was about $580 million first half last year. Ongoing growth, as you can see in our home loan portfolio, Business banking particularly, so in home loans we're just a bit over 5% of the market now. Business banking, we're still about 1%, I think, Greg, of the market there. So long runway to grow and we may talk later about the investment we're doing particularly in that area. Funds on platform also up. supported by 1% growth in deposits. You may recall last year we had very strong growth in deposits, driving the asset growth that we've been able to support with that now. The competition has picked up a bit in deposits, but we're still managing to grow deposits. And we're still very focused on the quality of the credit in that book, so very disciplined growth. So if the markets are... Competing a little too aggressively will pay back, and if there's opportunity, we'll grow at a slightly different pace. Commodities and global markets, down 31% at $1.383 billion. And as I've said, the contribution from the financial markets, so in foreign exchange, rates, futures, and the contribution from asset finance was solid and consistent. The asset finance portfolio, I notice, is up about 8%. And in the commodity markets, where the franchise continues to grow, client numbers are up. The reason the result is down is because, as I said, in our risk management income, we had lower volatility. in a mere gas and power. I think everyone will recall the activity levels going on there. As a result, volatility flowed over into the coal sector as well in resources, and gold was quite volatile. Whereas this half, also in North American gas and power and inventory management and trading, there was volatility that drove the commodities results. This half, a particularly quiet one, but the underlying income is up, particularly on the first half on FY22, if you look at the underlying growth, that was a period also with less volatility. And then Macquarie Capital resolved down 28% at $430 million. It was the high 500s first half last year. The fee and commission revenue is consistent with what it was in the prior comparable period and the most recent prior period and the market activity is picking up a little bit globally but the big thing is that in private credit we're continuing to invest so another one and a half billion deployed with over 20 billion now in that private credit book We're having good experience in terms of the quality of the investment of that portfolio, which is pleasing. Offsetting that contribution is the timing of realisation of assets. As I mentioned, first half last year, some particularly big equity realisations. In this half, less of them. I think we were taking advantage of the environment, particularly in the first half last year, where we had opportunity to realise mature assets. So that's the operating businesses. If I could touch on the capital and funding position, our funded balance sheet remains strong. Our term funding comfortably exceeding our term assets and $8.3 billion of term funding raised in the last half and the deposits now up about 1%, as I said, overall at just over $135 billion. Also our capital position, at $10.5 billion, a strong capital position. That's down from the $12.6 billion at the beginning of the financial year, where we did have the earnings for the first half but offset by the second-half dividend last year, and $1.7 billion of capital absorbed in the businesses. Across the board, pretty much, as you can see here, Macquarie Asset Management drew a couple of hundred million into seed investments and core investments to grow funds, co-investment. BFS, ongoing absorption of capital at the usual run rate for growing the loan books. Macquarie Capital, ongoing deployment in private credit and also some equity investment. CGM returning, releasing a bit of capital because credit exposures were lower, driven by movement in commodity prices. And the Centre, also corporate absorbing capital for regulatory requirements. But with that, we have still very strong capital ratios, well above our BAL 3 regulatory minimums. And given that very strong capital position, our board has approved a buyback of $2 billion, an on-market buyback. And that on-market approach will give us flexibility to be able to respond to market conditions or business opportunities as we see them. The board is comfortable that with the surplus capital that we have, absorbing the capital return, we'll still have a prudent capital position and ability given our conservative balance sheet settings, etc., to navigate the current economic environment and also be able to support business activities as teams see opportunities. And the board has also declared a dividend of $2.55, 40% franked. And there's, under the DRP, not planned to be a discount consistent with the approach of the capital return. And before I hand over to Alex, the last thing I wanted to touch on is that we were very pleased to announce today that our board has appointed Wayne Byers as a bank-only non-executive director, joining Ian Sains, David Whiting and Michael Coleman. And with Michael's expected retirement by mid-2024, he will make the third of the bank-only non-executive directors. And I think you all know Wayne as the former chair of APRA, but also his global experience in his powerful roles. So with that, I'll hand over to Alex to take you through in more detail. I'll come back and speak about Outlook, and then we'd be happy to answer questions.

Thanks, Shamara, and good morning, everyone. As Shamara said, I'll now take you through a little more of the detail of the financial results for the first half, and I'll touch on some other aspects of financial management as we move through the presentation. Starting with the income statement, you can see operating income for the group for the half was down 8% on the first half of last year. As Shamara mentioned, the principal drivers of that were a substantial reduction in investment income, down to $366 million from $1.55 billion in the first half of last year, after a really strong period of realising in the first half of last year. That was partially offset by a $403 million reduction in credit and other impairment charges coming through the group for the first half. And you can see pleasingly net interest and trading income and fee and commission income both broadly in line with where we were for the first half of FY23. Expenses for the first half were up 6% and you can see primarily increases in employment expenses and related expenses from the increase in average headcount across both the central services areas and the operating groups, partially offset by reduced share, profit share expense coming through the group consistent with the underlying performance. You can also see a step up in the other operating expenses and that largely reflects the investment we're making in data and digitalisation across the group coming through those operating expenses for the first half. So operating expenses up 6%. Income tax or effective tax rate at 29.3% versus 24.2% in the prior corresponding period and that reflects the geographic composition of income and the nature of income coming through the group for the first half. That's our bottom line for the group, 1.415, down 39% on where we were this time last year. If I now touch on the operating groups, obviously as Shamara mentioned, there's a little bit of noise coming through the Macquarie asset management panel for the first half. The end result, $407 million down from just over $1.4 billion last year. And you can see the primary movers there in the center of that bar chart. You can see $831 million less contribution from the disposal of green investments through the half. People recall we had a very significant period of divestment in the first half of 23. We just divested some waste to energy assets in the UK, Polish onshore wind assets, and we also divested the first of our wind farms in Taiwan. So that was coming through the first half. We didn't see that repeating in this half. The other thing, consistent with the long-standing practice we've had in relation to this activity, a lot of the expenditure in relation to development and OPEX actually goes through, in terms of those green investments, actually goes through the P&L. And so over the course of the half, we had nearly $100 million step-up in DEVX and OPEX associated with the investment we're making in Corio, our offshore wind platform, and CERO, our global... a European solar platform. So that was coming through the P&L. The other thing you can see is a step up in operating expenses, $103 million. There's a couple of drivers there. FX, as Shamara mentioned, was a headwind with a weakening Australian dollar. The other thing we had in the first half for MAN was a provision associated with a legacy matter that we had to take in the first half. So that's the sort of noise coming through the P&L. On the other side, obviously, from a base fee viewpoint, really pleasingly, we had a 13% growth in base fees on private markets, and that reflects the significant period of raising that we saw in Macquarie Asset Management over the last 12 months. and investing the team's been able to do on a whole range of assets around the world. Partly offsetting that was a $45 million reduction in base fees associated with our public investments business and that mostly reflects the asset allocation that we've seen consistent with other asset managers around the world where people are shifting from equity portfolios to fixed income portfolios. From an asset under management viewpoint, you can see $892 billion, so up 2% on where we were at 31 March. And within that figure is $35 billion worth of dry powder across our real assets, real assets stable of funds. A record level of dry powder, obviously consistent with the significant raising we saw in FY23, $38 billion, and the $8 billion of raising that Shamara mentioned earlier in the first half in the asset management business. Now, we added an additional slide here. There's obviously been a lot of commentary in relation to the economics of renewable asset development around the world. So we thought it would be useful just in the context of these results to actually add an additional slide here to give a little bit of context to what we see going on around the world. So firstly, on the left-hand side, you can see on the bottom of the left-hand side of the graph, you can see what's going on in terms of short-term capital expenditure volatility, particularly in wind. So in recent times, we've seen a step up in the capex associated with wind development. That's largely related to commodity price increases that we've seen through the back end of the last couple of years, together with the supply chain disruptions that emerged through COVID. That's normalising to some extent in a very recent term. You can see solar, by contrast, has basically been continuing its long-term trend. But overall, I guess, in the top left-hand side, you can see the long-term capex, both for wind and for solar development, continuing to head down, which is obviously a reflection of the economies of scale as we start to get more renewable energy assets developed in both solar and wind all over the world. On the right-hand side of that slide, we've got two graphs there that are showing you what's going on with power purchase agreements in the corporate sector, both in relation to solar and in relation to wind. And you can see across a whole range of markets around the world where we're operating, you can see a pickup in PPA prices over the near term. And the reason for that, obviously, they're reflecting inflation, they're reflecting increase in wholesale electricity prices in lots of markets around the world, and they're also reflecting the fact that there's a significant demand for renewable power as lots and lots of commitments have been made by corporates around the world to actually source power from renewable sources. So all that's coming through on the demand side, and you can see that reflected in the prices. Obviously, this price reflection is counterbalancing some of the capex inflation to preserve project economics on transactions. In our own case, we've obviously seen these dynamics play out in a number of markets around the world. One thing I want to draw everyone's attention to in relation to our offshore wind platform, Corio, we were really pleased just recently to be awarded the opportunity to, in partnership with Total and a local investor, to develop a a 1.4 gigawatt offshore wind farm just off the coast of New York in the United States. And indeed in that auction process we're able to secure a material step up in the offtake price from the prices that were available to people who bid in prior rounds. And the contract that we're awarded allows us to adjust the offtake price for the cost increases on certain components that occur between now and when we actually reached the decision to commence the development of the project. So the market is adjusting to the underlying factors to enable the development of renewable energy, and we're seeing that in lots of markets around the world. Obviously, more broadly, there remain significant capital requirements to fund energy transition and really strong demand for investors, albeit The current environment is providing some challenges from, as I said, inflation pressures, increasing interest rates. One of the things we talked about before, the shortage of talent to develop these assets around the world, and obviously the supply chain challenges. We remain confident, obviously, in the significant embedded value in our own portfolio, and we might talk about that over the course of the morning. And as Shamara said, we're really pleased with the progress the team is making in moving this activity from a balance sheet activity, which we've had in Macquarie Capital, toward that fiduciary offering in Macquarie Asset Management, and in particular, reaching the initial close of our energy transition fund in October this year. So turning now to banking and financial services, the second of our annuity businesses, another strong result, up 10% on where we were this time last year. And you can see that coming through all the core verticals, if you like, in BFS. So you can see mortgages up $47 million in terms of the contribution. That reflects a growth of about 14% in average terms in the mortgage book. Business banking up $85 million. You can see a growth in the volume of lending. You can see a growth in the deposits that are supporting the business bank and improved margins that we're seeing come through there. And we're also seeing a growth of $57 million in wealth management, which is both an improvement in margins that we're seeing come through there, together with a growth of funds on platform up about 10% from where we were this time last year. Partly offsetting that is the increase in expenses, and we continue to invest in BFS to improve the customer offering, the digital, the data capabilities to improve the customer offering, and we think that's paying dividends in terms of how the business is developing. And we're also upgrading the system or high-grading the system to ensure that we can meet the important regulatory and compliance obligations that the bank and financial services business face. So we're seeing that come through. That expense is really reflecting of headcount. So the headcount is up and we also had salary increases coming through over that period of time as well. Down to line drivers from a BFS perspective, all basically moving in the right direction. Obviously, car loans are down a little bit again, although the decline is slowing, which is really encouraging in terms of what's being done for product development there. I think exciting on this half, we've seen a big pickup in the business banking loan activity up to $14.6 billion from $13 billion at 31 March. That's good to see the work the team's doing in digitising. and upgrading that capability and the offering we have for customers in the marketplace. In terms of maybe turning to the first of our market-facing business and now the commodities and global markets business, another really strong half from CGM. And I guess the point that I'd make here is that we talked a lot about the diversity of the franchise in CGM, and I think the result that we're seeing coming through this half really reflects the diversity or the benefits of the diversity that we've talked about in the past. We talked earlier in the year about the fact that CGM in the first quarter in particular experienced more subdued trading conditions, particularly in our North American gas and power business, albeit the client franchise remained quite solid through the half and market conditions toward the back end of the half have improved. materially from where they were in the first half. In terms of the drivers of the result, you can see commodities income down $421 million. That was down 24% from the first half of FY23. You can see the big driver there, risk management income down $380 million, which is really about 25%. And mostly that's coming through our European gas and power business. and our resources business. Both of those segments of CGM had very strong first half of 23, consistent with the underlying volatility we were seeing in the business. Despite the drawdown in terms of the contribution this half, the underlying client franchises in both of those aspects of CGM continue to perform very well and grow really well into the future as well. The other thing we saw was a $55 million reduction from inventory management and trading. Again, more subdued trading environment, as we talked about, partly offset by the timing of income recognition associated with transport and storage contracts coming through the P&L in the first half. Financial markets down $27 million, or 5%, a really solid contribution, again, against a very strong comp in a comparable period. Of course, people recall that was the big step movement up in interest rates in particular, and the impact that had on both interest rates and currency movements. That obviously was coming through in the first half. We didn't see that in the second half. I think the growth, the improvement in the franchise and the growth of the franchise over the course of the last 12 months. The asset finance business continues to produce a solid result and we've been able to grow our exposure to that market through increased lending to shipping and TMT in a range of markets around the world. As Shamara mentioned, costs were up $302 million for the half, so it's quite a big step up in costs, about 24% step up in cost. That really reflects the investment that the team is making in data to support the business in digitalisation of the business, both to support the growth of the business and the growth of the franchise, but also, again, the investment we're making to support the regulatory and compliance obligations that are associated with a global commodities and markets business. In terms of the underlying drivers, again, this is a slide that hopefully everyone's pretty familiar with now. We've had it for some time. So if you look on the operating income side on the left-hand side, you can see that the vast majority of income coming through the first half of 24 was the underlying client business. Obviously a smaller contribution from inventory management and trading, consistent with the more subdued environment. Interestingly, if you look at that, particularly on the commodity side, if you look at the commodities income coming through for the first half, it's actually up 17% on the first half of FY22, which again is a reflection, I think, of the growing franchise and the customer franchises coming through. And you can see that customer franchise reflected in the client numbers on the top right, which continue to grow. And of course, what we have seen from a capital viewpoint is capital coming back to the group as activity levels have come down and commodity prices have come down. So most of CGM's capital is exposed to credit and you can see that credit capital reducing with both activity and with actual commodity prices. Market risk continues to represent a relatively small portion of CGM's capital and in fact a slightly smaller portion than we saw in 22 and 23, again consistent with the environment that the business has Macquarie Capital down 27%. You can see the drivers there in the middle of the page. Investment-related income down $247 million. Again, the first half of last year was a really strong period of realisation in Macquarie Capital. We were able to take advantage of that. We didn't see that repeat in the first half of this year. That was partly offset by a growth in the contribution from our private credit book. up $195 million. That private credit book in terms of average drawn balances has grown by $3.8 billion. The other thing we didn't see in this half was the losses we took on our DCM underwriting positions that we saw coming through the first half of last year. We obviously didn't see those repeated. So that's coming through that net income line as well. Fee and commissioning come down slightly, down 5% on where we were last year, but quite a solid result, particularly M&A. Capital markets have been a bit weaker, and we've actually seen equity volumes come up in Macquarie Capital, so a little bit lower than where we were last year, but quite a strong result, and the pipeline looks quite good there. And operating expenses, consistent with other parts of the organisation, are largely reflecting the investment the team's making in technology and infrastructure to support the global platform. Now, pleasingly, from a capital viewpoint, you can see the capital we have alongside Macquarie Capital up from 4.2 to 4.7. It's good, obviously, in this cycle, you know, we're pretty encouraged by the investment the team's making. We've been able to grow the private credit book, and you can see that coming through the investments over the period. The other areas where the team has seen opportunities really in relation to digital infrastructure, things like fibre networks that the team's been able to grow over the course of the last... The last six months, government service in the United States, business services, those areas that have been a core component of Macquarie Capital's activities for a long period of time, we saw the teams for opportunities to grow our exposure. And obviously that capital, both in the private credit book and the equity book, underpins, we think underpins the story going forward for Macquarie Capital. So we're really pleased with how that book's actually performing. Now turning to some of the other aspects of the financial management of the group, turning to the cost of regulatory compliance and technology spend, another chart that hopefully people are familiar with. Just a few things to point out here. In terms of the reg and compliance spend, you can see that $622 million in the first half Now that's up 31% on where we were for the first half of 2023. Interestingly, it's only up 9% on the expenditure incurred in the second half of 2023. So you can see the growth rate actually slowing. And so we pointed out one of the things that was a significant piece of work in the Australian marketplace was the introduction of the unquestionably strong regime, the New Basel III regime. That's obviously now happened. So that project has drawn to a successful conclusion. Some of that's starting to play its way through into the cost of regulatory compliance. The other piece on this page, which is worthwhile drawing out, is the technology spend. I've mentioned it a couple of times on the way through. Technology spend's up about 18% on the prior comparable period. Interestingly, one of the things that is happening, though, is that the proportion of our technology spend that we're spending on change the group. has actually increased from 22% back in FY18, right up to 35% today. And a lot of that change is obviously improving the capabilities of the organisation, which we think will pay benefits into the future. The balance sheet continues to be strong. We raised just over $8 billion in the half. Most of that raising was done in the bank. And the wide average life of the funding out of 4.4 years, I guess, consistent with the approach we've taken for a long period of time. And we've continued to try and diversify the owners of our paper all around the world. And we've been successful over the course of this half in doing that. From a deposit view, deposit growth, obviously this half was a little less than we've seen in prior halves. I mean, people recall, I think in FY23, we had, we grew deposits by $33 billion. So we're obviously ahead of the curve in terms of the competitive environment for deposits. It is very competitive out there. We obviously slowed our growth in deposits over the course of the half, consistent with the slowing growth that we've seen on the asset side in BFS. The one thing I would say is that the team continues to broaden and diversify the deposit products in the market and continues to upgrade our capabilities, particularly our digital capabilities, to capture those deposits for customers and make sure the experience is as good as it possibly can be. The loan books for the period were up 6%, mostly that's BFS on both the business loans and the home loans, and you can see at the bottom of that page the growth in Macquarie Capital's private credit book. On the equity investment side, you can see up from $9.6 billion at March up to $11.4 billion. The main driver there is the green energy movement you see in the middle, and there's a couple of things going on there. uh firstly um we're able to complete our our project up one of our offshore wind projects in in asia so uh we're able to complete that investment um which was which was good so that's now reflected on the uh the carrying value of the uh out in the balance sheet we're also continuing to grow we have a significant solar platform in uh again in asia in india that we've been able to develop over the course of the half and and money's gone in there and as i said before we're really delighted in partnership with total and the local partner to be awarded the opportunity to develop a large offshore wind fund in the US. And again, the seabed lease for that is coming through that value at the half. We also saw opportunities for Macquarie Asset Finance, the Air Finance at least, was able to acquire a portfolio of aircraft and some of that's coming through in this half. And as I said before, Macquarie Capital growing its investments in digital and technology investments in a number of markets around the world. From a regulatory viewpoint, the Australian regulatory environment continues to evolve. The main focus over the next little while will be in relation to liquidity, interest rate risk, and obviously the consultation paper that APRA's released in relation to additional tier one capital. Obviously we will participate in those consultation processes and we think are well equipped to manage any changes that might arise from any of that. There's obviously no update to the disclosure in relation to Germany. The CET1 ratio for the bank continues to be very strong at 13.2%, as does the LCR position and the liquid asset position. And finally, just in relation to capital management, as Shamara mentioned, the board has elected to leave the dividend reinvestment plan on at no discount and will be buying shares on market to satisfy any applications under the DRP. In relation to the on-market share buyback, we'll go through a process of getting the docks cleared by ASIC, and then we'd anticipate that we'll be in the market buying shares toward the end of the month. So with that, I'll hand back to Sumara. Thanks very much.