Moneta Money Bk

Dear ladies and gentlemen, welcome to the conference call of Monita Money Bank regarding first quarter of the year 2026 financial results. Please note that this conference call will be recorded. This event will have a live presentation followed by a Q&A session. As a reminder, all participants will be in a listen-only mode. Today's speakers are Mr. Thomas Sperney, Mr. Jan Frijec, Mr. Jan Novodny, and Mr. Andrew Gerber. May I now hand the call over to Mr. Thomas Sperney, who will lead you through the conference call. Sir, please go ahead.

Good morning, ladies and gentlemen. Once again, I have the pleasure of presenting our quarterly results. Let's go to the summary of key highlights of our performance for the first quarter of 2026. We've generated net profit of 1.6 billion crowns. This is an improvement against comparable period of 2025 by 8%. The result, the first quarter accounts for 24% of the guidance that we put out in late January. of this year. So I would say that we are performing according to expectations for this year. The result comes on growing operating income. We've generated 3.5 billion of operating income with a nearly 5% improvement against, again, comparable period. We enjoy stable stable cost base, which increased by 1% to a level of 1.5%. So there is really consistency of what we guided at the beginning of the year. With respect to the balance sheet of the bank, we reached $520 billion, expanding by 3.9%. This is on the basis of expanding funding base of the bank which reached $474 billion and increased by 3.9%. And we enjoy strong demand for our great products, namely from small business and SMEs. The portfolio grew 6.8% to the level of $297 billion. Here I would like to underline the fact that we are currently focusing on small business and SMEs due to favorable capital allocation and the margins which will enable us to accomplish the NII target in both in relative terms increasing it to the level of 2.1 by the end of this year. Going to capital we have capital adequacy ratio of 17.9%. This is negatively impacted by one of events which will reverse itself in during the second quarter and Jan Fritschek will give you a little bit more detail. In fact, it's in a magnitude of about 40 basis points and it should be very subtle, as I said, during the second quarter. Year 1 ratio at 13.7% and very comfortable morale position at 27%. exceeding the regulatory requirements which have been levied upon us. We have this Tuesday held a shareholder meeting and approved the dividend of 11.5 pounds per share proposed by the management. In totality this accounts for 5.9 billion pounds of Net Profit of 2025 to be distributed to our shareholders. With respect to the return on tangible equity in the first quarter, we've accomplished 21.6% return, which is 2.1 percentage points better than in a comparable period of last year. Liquidity coverage ratios to that record high 415%, this is due to one of deposits which came in at the end of the quarter and subsequently left the bank. If I summarize the shareholder meeting, we accomplished approvals of several key corporate documents and made the financial statements on both consolidated and individual basis. As I mentioned, we have approved the dividend and we have amended the remuneration policy of Moneta. The amendment concerns improvement or increase of payments to our supervisory board. That increase accounts for about 80,000 euros. annually and it had been in fees as well as the remuneration report of the bank for 2025. We enjoyed strong presence at the shareholder meeting exceeding 73% through physical presence and correspondent role. Now I would like to briefly summarize the operating environment of Czech Republic. Last year we enjoyed better GDP growth than was expected at the level of 2.6%. This year had been predicted at 2.9%. Obviously this prediction was done before the war in Persian Gulf. So we will see what impacts we will have from the higher fuel costs and related inflation pressure, unless so far Czech Republic has been in very good shape. If we go to government deficit and indebtedness, there's nothing to report on indebtedness. It actually decreased slightly. The deficit is projected for this year at $310 billion. and the first quarter had seen deficits of 27.6 billion pounds. Then the last one, unemployment. Year on year you can observe the unemployment increase by 50 basis points. So far we haven't seen any effect on NPL formation, size of NPL portfolio or defaults and such. and we will cover that in the risk section, which due to Norman's absence, I will cover later on in the presentation. If you look at inflation and interest rate environment, inflation seemed to be subdued. Annual inflation stood at 2.2% and month-on-month. at 1.9. So you can see from this that the Czech National Bank is close to the market of 2% and again it remains to be seen what will happen to the inflation due to elevated fuel costs and then the tickle down effect how it will translate into the economy as such. Nothing to report on the key benchmark today. stands at 3.5%. However, if you look at other financial instruments, the probability seems to be skewed heavily towards rate hike. I'm referring to the FI market and the probability seems to be about 70% that we might have 25 basis points rate hike in a relatively short period of time. yield curve. If you look at the yield curve, the short and stable against last year actually decreased against the comparable period of 2025, the first quarter. On the medium to long term, there is evident increase in the expectations of and the swap market the swap market reacted relatively strongly to the conflict in the Persian Gulf and here we have contributors to inflation what is most notable I would say is transport communication category and then restaurants and services seem to be continually So much for the macroeconomic environment and let me comment on our operating platform which consists of four key pillars for our operations. We have a steady situation in terms of client branches and the ATM alliance network. Unemployment against stability, very slight decrease. However, trend of decreasing front-end employees. This is on basis of digitization and changing behavior of our customers as you will see on the digital platform commentary. And we have increase in the middle and back offices of the bank. And here I would comment that it has three components. as we are processing more transactions we need more people on the risk management side and on the back offices this is the first element second element we continually invest into cyber security and crime prevention professionals and third IT we need more analysts we need more solution architects and as we are trying to Keep up the pace on digitization of the bank. This is obviously placing strong demand on the bank in terms of these skills in those three areas. Now, going to digital platform, we have healthy growth of digital users. This namely concerns the increases, namely concerns download and usage of our mobile platform SmartBank. You also see fairly healthy growth on the daily touch points on the given day on average 725,000 touch points. Coincidentally, this is pretty close to how many visits we realized per annum throughout the branch network. Very strong growth on lending volume, plus 20%. We are very happy with how the platform performs, and this is not only SmartBank, but it's also our mortgage platform, Finanso and Refinanso, where we see an increase of interest by customers to refinance their mortgages and to originate primary mortgages through those digital platforms. Strong growth on payment transactions. We have slightly less third-party transactions, and I believe this is due to discontinuation of some auxiliary products. And strong growth on servicing transactions. Servicing transactions are very important. We've got account maintenance management. We've got liability side, balance sheet, third-party products. We are successfully moving these tasks from the realm of physical world into self-service done through the SmartBank application. Going to the branch network, here on the first line you see stability, nonetheless decreasing from office time. However, a headwind or an issue that we struggle with is all of the banks in the market is decreasing level of staffing in our branches. And the way we will deal with it is further optimization of the network in terms of coverage. That's first dimension. Second dimension concerns relocation of branches to high traffic areas. And the third improvement, which we will implement by the end of this year, we will pilot it, is an appointment setting platform in order to utilize the branches and skills residing in them for high value products. We actually already see, I would say, transition from mundane tests into high-value products. The testimony is the more than 13% growth on the sales of insurance and sales of wealth management products. You also see that the network continues to be very material to us in terms of ability to lend. we have originated more than 13 billion through the network with an increase of nearly 32% so it remains to be a strategic asset for the bank and we are very happy with the performance of the network in terms of net promoter score the satisfaction with the network exceeds 90 points and we are at the main guards of the banking sector in Czech Republic in terms of that metric. Now going to the contact center, which is the third pillar of our business model. Last year we saw declining quality and increasing traffic discontinued in the first quarter. We have increased the staff somewhat to a level of 224% which is around about 2% increase against 5% increase in traffic. The bank is seeking to find ways how to prevent calls coming in and we have already taken some measures to manage the cost structure of the contact center. On email we are successful in redirecting these queries onto the digital platform. nonetheless here we are implementing artificial intelligence in order to sort the emails to provide precise and consistent responses and you will see an impact of that project in the second half of the current year. Increasing the staff enabled us to improve the performance in terms of lowering quite substantially the abandon rate is now is at 6.6% and we decreased the average by 5.5 percentage points so we reacted to that situation which was unfavorable in our view with some marginal cost investments and we improved also the metric on answered costs quite substantially and the client satisfaction improved marginally to 82%. to 82 points on the Net Promoter Score. Now, continuing into the ATM network. On the side of the network, we have stability. As you know, we share this alliance with three competitors, which is CommerciBank, Alnit, Reddit and AirBank. The benefits are quite substantial for us. What we've accomplished with our partners through the first quarter is an expansion of the deposit taking ATMs we now have 957 machines at our disposal this is quite good because we see a rapid increase in usage of those machines in terms of deposits and it enabled Moneta to start the reduction of cashiers and cash desks throughout our network and this process will will be accomplished by the end of the year we will really have majority of the network on cashless basis so this is quite an important benefit the other thing which is worth mentioning here that not only we digitize the service transactions but also the software which is implemented on our network enables clients to perform a fairly significant number of Service Transactions, and these are growing, as you can see, by 6%. So, if I summarize the synthesis, we've generated net profit of 1.6 billion. What is important to us is that this is on the back of improving operating income, and against the background of steady operating expenses. The credit cost or cost of risk at 160 million is according to expectation and at the lower end of the guidance that we have provided. So we consider the quarter as expected and with that I will turn over I appreciate to give you more detailed view of the P&L and I will walk you through the details on that. Thank you for your attention.

Thank you so much. Good morning, ladies and gentlemen. I am now on page 15 and it's my pleasure to walk you through the profits and losses statement section. Let me repeat the key financials. In the first quarter of the year, Moneta delivered net profit of nearly 1.6 billion. representing a year-on-year improvement of 8%. Earnings per share stood at 3.1 crowns and return on tangible equity improved by 2.1%, which goes to 21.6%. Improved profitability was driven by higher operating income. The growth reached 4.8% and the balance generated student 3.5 billion. The improvement was driven by higher net interest income by 7.7% up year-on-year stemming from improved net interest margin by 10 basis points and higher lending income. Net PN commission income line improved by 1.8% supported by ongoing strong performance Cost base came at 1.5 billion, only marginally up year-on-year by 1%, and this amount includes annual contribution into the Deposit Insurance Fund and Resolution and Recovery Fund of 209 million. Broadly stable cost base accompanied by operating income growth of 4.8% resulted in a significant improvement of the cost-to-income ratio, to 38.3% against 40% reported in the first quarter of last year. Credit cost line came at 160 million, or 22 basis points of the average portfolio, which is a low result at the bottom of our guided range between 20 to 35 basis points, and was enabled by persisting benign risk environment, supporting cloud delinquencies, and low NPL costs. Moving forward, on page 16, we report development of the debt interest income line. In the first quarter, we delivered 7.7% growth year-on-year, and as I said, this is a function of increased debt interest margin by 10 basis points, and also supported by higher lending income by 7.3%. which was supported by the loan portfolio expansion of 6.8% accompanied by positive rate pricing within the mortgage book and Andrew will provide you with more details on this in the budget section later. 25 basis points decline of the 2 week repo rate also resulted in lower treasury income partially mitigated by cost of funds reduction. Moving forward on page 17 we provide development on net fee and commission income in detail. In the first quarter we delivered year on year improvement of 1.8% which is a combination of third-party products by 40 million up and as you can see this was mostly supported by nearly 20% growth of the commissions generated in the wealth management product distribution franchise accompanied by probably stable results in the insurance products distribution franchise. Free income category shows year-on-year improvement of 25 million, supported by both categories higher penalties by 4.1% and higher transactional and servicing fees by 6%. And lastly, free expense line shows an increase year-on-year due to an extraordinary bonus analyzed last year. On page 18 we provide further details about performance in the Health Management Product Distribution franchise as you can see in the 162 million up by 20% year-on-year due to higher trailer fee by 34% reaching 172 million in the first quarter and this was delivered on the basis of the rapid growth of the outstanding amount of distributed wealth management product of 29% reaching 81.4% In the first quarter of this year, our customers invested with us 5.7 billion, which is nearly the same volume as invested a year ago. And this is reflected in the broader stable opening fee, reaching 19 million in the first quarter. Moving forward, on page 19, we provide a detailed view on the performance in the insurance product distribution franchise. In the first quarter we generated 293 million here and this is nearly the same result as delivered last year. And this is also reflected by number of sold insurance products being 45.2 thousand of new insurance policies sold this year against 45 thousand policies sold last year. On the right side of the page you can see that in two areas out of three reported we delivered improvement, we strengthened the performance, namely payment protection insurance went up by 9% expressed gross return premium and also pension insurance performance improved by 12.9% in terms of number of units sold in the first quarter this year against the last year. On the other hand, in the first quarter we suffered a slowdown in the distribution of life insurance by nearly 10%. On page 20, we can continue with the cost base development. As mentioned before, the cost base length at 1.5 billion in the first quarter, only marginally up year on year. And two out of four categories show a cost reduction, namely depreciation and amortization charge is down by 9.2%. resulting from a regular revision of remaining use life of fixed assets, accompanied by 6% reduction in the admin and other cost categories. On the other hand, regular affiliate charges went up by 7.2% year-on-year. This is in line, is broadly in line with the deposit-based expansion. And personal costs are up by 8.5% year-on-year, which is a combination of a higher average salary accompanied by a higher performance driven variable compensation to the front office and to the management. On page 21, we provide further detail to the personal costs. As you can see from the chart, on the recurrent basis, we report 4.9% increase year-on-year, and this is attributable to the 6% increase of the average salary, which is still below the average wage inflation in the Czech Republic, being at 7%. And this is only marginally mitigated by small 0.3% FTEs reduction here. The reported growth of 8.5% is also driven by higher one-offs in the first quarter this year. And this is a combination of higher performance driven annual variable compensation for the management Partially offset by a release of provision for annual vacation and severance. And on page 22, we complete this section with a detailed view on the administrative and other expensive development. As mentioned before, we record a cost reduction in this category of 6%. And this is a combination of lower IT costs stemming from a near completion of the cloud migration in 2025. Together with 24% reduction in other cost subcategories, the most significant saving within this area was achieved in the first stage. On the other hand, in the first quarter, we spent more on the marketing by 15.6% to support the business development. And Andrew will give you more detail on that on the balance sheet section. I hand over now to Andrew Weber. Thank you.

Thank you, Jan, and good morning, ladies and gentlemen. So moving to page 24, we look at some highlights of the balance sheet development, starting with the loan portfolio. Overall, the loan portfolio grew 6.8% year over year, 1.8% quarter over quarter, reaching $200. At the same time, the yield on the portfolio increased five basis points, reaching 489 basis points. And this was driven largely by the continued repricing of the mortgage portfolio as it moves through reputation. The funding base of the bank grew 3.9% year over year, 2.2% quarter over quarter, reaching $473.8 billion, whilst the cost of funds decreased 13 basis points to 211 basis points. And I think this is a pretty strong performance given that in order to keep a lid on the cost of funds, we had to adopt a relatively uncompetitive position in the market. So the fact that we were still able to drive deposit growth in that situation and it deserves a good outcome for us. Moving to page 25, we take a look at the high-level view of the balance sheet. Overall, the balance sheet grew 3.9%, or nearly $20 billion, and you can see that the customer deposits growing 4% are the key driver of the growth. On the asset side, the net customer loans grew 6.7% year-over-year, investment securities up 3.7%, while the cash and balances at the central bank decreased 21%, if we look to see productively in the market. Moving to page 26, we take a look at the new business development. Overall, new business lending volumes grew 27.3% year over year, reaching 20.9 billion, with strong performance in consumer lending, which is up 22.9% year over year, small business up 20%, and SME up 66.8% year over year. On page 27, we see how the new business lending performance translated into portfolio growth. Overall, the portfolio grew 6.8% year-over-year, reaching $296.9 billion, with strong growth in SME up 14.2% and small business up 25.7%. The growth in retail was more rooted, 1.9%, and if you move to the next page, you see that this was driven by consumer loans with solid growth of 8.3%, but much more modest growth in mortgages, just 1.2%. However, as Honda mentioned with the marketing costs, We ran a very successful mortgage campaign in March and the first half of April, and we now have a very strong pipeline in mortgages, which I think will come through in the numbers during the remainder of the second quarter and into the third quarter. So we should see better performance in the mortgage portfolio going forward. The category Other Loans decreased 12.8%. As I've mentioned in the past, this is predominantly a result of the bridging loan portfolio, which is a legacy product you need to distribute through the building savings entity, and which is now essentially a runoff portfolio. So we continue to see the decline of that portfolio. On page 26, we look at the commercial loan portfolio. Overall, the portfolio grew 16.3% with strong growth in investment loans up 20% year over year and small business up 25.7%. I think what's important here is that the majority of this growth is driven by secured lending, which is a product where we're very well differentiated in the market. It's well-priced, and due to the collateralization, the profitability is very good. So this is a very positive development for the bank, as Tomek mentioned earlier. On page 30, we take a look at the yield development. Overall, the yield on the loan portfolio has been stable with slight increase in retail. As I said, this is driven by the repricing of the mortgage portfolio as it moves through re-fixation. In the last 12 months, we saw nearly 24 billion of mortgage volume repricing through the refixation process. And at the same time, the commercial loan portfolio yield is broadly stable as the floating rate part of that portfolio is basically unstable due to the market rates being unstable. So overall, I would say solid start to the year from a lending point of view. Very good performance, obviously, in commercial. Solid performance in consumer loans. And as I said, with mortgages, thanks to the campaign, we now have a solid pipeline, which is just through the remainder of the second quarter and into the third. And I think for now, we're well-placed to keep up Thank you very much, Andrew, and good morning, ladies and gentlemen. Now we are on the page 31, where we are showing the growth of the funding base throughout the last four quarters.

We have grown by almost 4% to 473.8 billion cheque rounds. You can also see the split-pair segment and its year-on-year growth on the right side of the page, where both segments contributed to the strong funding-based expansion. Starting on the next page, page 32, we move to a specific segment development starting with retail. The combined position of retail deposit and wealth management grew by 7.3% year-on-year, while we know that 65% of the investments are funded from the existing deposits. The overall balance ended up with Q1 2026 at 422 billion checkouts, which represents almost 30 billion growth year-on-year. Next page, page 33, shows the evolution of the virtual deposit base, which grew up from 330 billion check rounds in Q1 2025 to 341 billion in Q1 2026. This represents a very good growth rate of 3.2%, and you can see that in fact the growth was accelerated following the introduction of the competitive retention interest rate in Q1 2020. On the page 34 is the same space for the commercial segment. We have achieved a growth of 6.5% year-on-year and the balance of commercial customer deposits stood at 109.3 billion checkouts at the end of Q1, while a big part of the growth comes from current accounts products. And now let's move to the last page of the balance sheet section, which is the evolution of the funding costs. We have ended the Q1 at 2.11% overall cost of funds average, with a very little change quarter on quarter due to the fact that competitive market situation does not allow for further increase yet. However, in year-on-year comparison, you can see that we were successful in further improving our funding grade positions. And with that, thank you very much for your attention, and please let me hand over back to Thomas to walk us through the next section of today's presentation.

Okay, let's go to the risk. If we summarize the situation, the credit cost ratio at 22 basis points, as I said, this is the lower end of the guidance that we've provided and this is driven really by our ability to successfully manage the portfolio. Payment Discipline of the portfolio is good and the second factor is our ability to decrease the P&P level as well. in the second. Loan loss provisioning decreased by 24 percentage points due to the fact that we have A. decreased the level of non-performing receivables and B. we have updated the IFRS 9 model and the scenarios work positively for the bank from this perspective. If you look at the non-performing loan coverage, this actually improves by 12 percentage points and it's fairly sturdy. And lastly, non-performing loan ratio at a historical level of 1%. And if we go to the segment view of the cost of risk in the first quarter of this year, we've incurred cost of 160 million on retail 182 million which is in line it's nearly identical to the first quarter of last year and we have released some commercial exposure related provisions on I would say half a dozen of names where the performance of those exposures warranted additional decreases And all in all, as I have mentioned, we disposed 10 PLs with a write-back of nearly 40 million crowns, 79 million, which is higher than what we had accomplished a year ago. If we go then to the formation, sorry, if we go to the provisioning again, the portfolio, the gross portfolio grew by 6.4%. The overall loss provisioning decreased by 12% and the decrease is attributable mainly to the reduction of management overlays. The overlays were placed there with the intent to cover risks arising from repricing of mortgages. Nonetheless, these risks have not materialized during past 12 months. the position has been decreased by 200 billion crowns and we still have this potential benefit should the repayment performance on the repriced mobis continue to be favourable and in absolute amounts we carry 2.9 billion of non-performing receivables roughly 50% of those receivables are under regular repayments. So they are, again, assuming continued good performance on those, we have some potential for updates. And now we go to the formation view, formation of MPLs at 953 on broadspaces. The few rates at 8.09. You can see that this is pretty much stable compared to the last three quarters. And the 262 write-off is representing the volume that we took off the books through the sales. So on the net basis, the formation had been actually positive. increasing the overall level of the non-performing receivables to the 2.9 billion. So the benign situation continues to prevail so far. And if you go on the next page, this is also evidenced by the SDU rates, which if you look at the 30 days, hours around 0.3% if you look at the 60 plus we also have stability on that figure and the 90 plus decrease and this is again attributable to our efforts to continually crystallize crystallize the risk dispose of the FPLs and the right backs in the first quarter in the amount of 39 trillion against the net book value. The carried net book value testifies the sufficiency of provisioning policies that the bank issued. Thankfully, we continue on this front to be in a good position, in position that we expected at the end of last year. And with that, liquidity and capital will be covered by Hansa Fletcher.

Thank you so much. Ladies and gentlemen, I am now on page 43. Let me continue with the liquidity management section. Throughout the period of last four quarters, Moneta maintained robust and stable liquidity position, which is demonstrated across all ratios on the page. Namely, loan-to-deposit ratio being at 66% and share of high-quality liquidation from custom deposits to get 39% at the end of March. Below that, we report regulatory ratios. Both are significantly above the regulatory minimum limit of 100%. And on page 44, we report the development of the high-quality liquid assets. The position at the end of March stood at $176.7 billion. The year-on-year decline of 2.4% is fully attributable to the loan portfolio growth of Swiss. and you may notice that in the first quarter of the year we continued to invest excess liquidity into predominantly Czech government bonds. And with that let me move forward to the Capital Management section, starting on page 46. Moneta maintains a solid capital position demonstrated by capital adequacy ratio of 17.88% against the management's target of 15.25%. And also tier 1 capital adequacy ratio of 13.72% against the management's target of 12.5%. The excess capital in absolute amount stood at 4.5 billion. and out of that the distributable tier 1 excess stood at 2.1 billion. Requested assets went up by 4.6% since beginning of the year and I will provide you with more detail in a minute. Moving forward on page 47 we provide the detail about the capital position on the consolidated level. The regulatory capital and absolute amount stood at 30.8% stable since beginning of the year, risk-weighted assets density also stable at 32.7%. And in the chart with the excess capital development in the bottom right corner, you can see that on top of the excess capital, Moneta holds accrual for the future dividend distribution of 1.4 billion, representing 90% of the consolidated net profit. And we complete this section on page 48, with the capital position on the individual level. Here the position stood at 45.6 billion in absolute amount, up by 1.2 billion since beginning of the year. And this represents MRL adequacy ratio of 26.97%, significantly above MRL management target of 22.05%. And as I promised, the risk-rated assets went up since beginning of the year by 7.8 billion or 4.8%. And this is a combination of 3.3 billion of incremental RWA's attributable to the loan portfolio expansion, 2.8 billion due to temporarily higher euro liquidity, and 1.1 billion is driven by annual update of the operational risk requirements. It is important to mention that 3.2 billion of increase of RWA is only temporary and will be released in the second quarter as Tomas Pudil already indicated at the beginning of his presentation. So this was my last comment to the Capital Management section and I will now hand over back to Tomas for guidance and final remarks. Thank you.

As I said at the beginning, with respect to the guidance, the minimum target of 6.6 has now been achieved at the level of 24%, and obviously the first quarter is impacted by the full amount of mandatory charges. So from that perspective, we stand exactly where we should be. I think if you look at the medium term, our aspiration over the medium term is to increase the five-year profitability of the bank by $10.4 billion. This assumes or is necessitated by generating a profit of $37.1 billion, which if we are Successful in doing so will improve the forward five-year cumulative earnings of the bank by nearly 40% compared to the last five years. What we are doing in order to achieve this target, so first on the capital side, we are currently evaluating some options how to further optimize the capital structure and the assessment should be completed by the end of May. And I believe that we still have quite sufficient room to improve, optimize the capital structure in favor of keeping perhaps exceeding the target of the 90% payout. is the first I mentioned. Second I mentioned on the revenue front I mentioned it at the beginning the lending policy of the bank is now focused with a lot of precision on high margin low capital allocation products that we are able to place into the market. We are successful in that if you look at the growth of consumer lending, we exceed 7%. If you look at growth of the small business franchise loans, we exceed 25% growth rate. And on SMEs, if you're lending investment loans, plus 20%. So we are very focused on this. Second thing, we are focused on improving the wealth management distribution by addition of new products. by continuously reviewing incentives and trying to withstand whatever uncertainties or volatilities appear as we go through the year. And with the expansion of the bank, we also see a stronger intermediation in terms of payments and this was demonstrated in the first quarter by the 6% growth on the transactional fees, accompanied by lower cost loads that we have to put into the intermediation as such. In terms of cost base, we show unfavorable development in the personal expenses, 8.5%, but this goes upside. to a level, I would say, between 4% and 5% during the next three quarters as we absorb some of the one-offs that came in from improved commercial performance of the bank and so on and so forth. So we are not particularly worried about this. Nonetheless, we have a challenge of reevaluating the physical coverage of the network, of the branch network, to deal with this continuously. Ten years ago I said when we had more than 250 branches, I made a commitment to shareholders that this would be 120. We are at that level. Nonetheless, we will have to, again, re-evaluate, optimize, reallocate the coverage into places where we can partner and generate additional revenue. additional business volumes. On the overall efficiency front, we are employing artificial intelligence with the view that the payback should be below four years and so far we are in experimental phase as I said on the AML, on the cybercrime prevention Now we are moving into back offices and contact center and we are discussing with some strategic partners how to do a more focused AI driven transformation of the bank. Should we decide to do that, we will absorb it into the regular investment budget and we will realize Realize the program over the next 12 months. I think assuming we can start in the summer, we should continuously harvest some fruit that will come out of that. The management team is stable, motivated. We are all in good mood that we survived the first quarter. And with those words, I will turn it to Q&A.

Thank you. We will now begin the Q&A session. If you would like to ask a question and you have joined the call via Zoom, please write into the Q&A chat box or use the raise hand function on your screen. Before speaking, please make sure that your device is unmuted. Once your question is answered, please cancel the raise hand function. If you've joined via the phone, please press star followed by one on your telephone keypad to enter the queue. One moment please for the first question. Our first question comes from Thomas Unger. Please state your company name and proceed with your question.

Yes. Hi. Hello. This is Thomas Unger from Yes Group. I have a couple of questions. The first one and the main one is on the conflict in the Middle East and the impact that you see on your outlook. Obviously, there's a different kind of inflation pressure now from energy prices that we've seen in recent weeks that will affect interest rates and also macro assumptions. So how does that affect your – what does that mean for your outlook 2026 and maybe beyond in terms of costs, net interest margin, risk costs? Are you – Anticipating any changes in the forward-looking element of your risk costs management overlays in the coming quarters. I'd be interested in that. Then secondly, the loan portfolio composition. Obviously, loan growth is largely driven by the commercial segment, and you mentioned the a very good pipeline in mortgages. In terms of loan growth and composition, what can we expect for Q2 and Q3? And then lastly, on your capital, capital structure, that you have measures or might decide on measures to come to optimize the capital structure. is an extra dividend as you've paid it in the past in the cards for the second half of 2026? Thank you.

Okay, so let's take it from the back, from the easiest to the most difficult one. On the capital measures, I said we are assessing them. We are assessing them. We should finish the assessment by the end of May. and decide which way to proceed. I'm not really at liberty to explain exactly what we want to do because the telephone will start ringing. So Thomas let us go through the homework and we will report this on the 24th of July what we have decided to do. Obviously all of the optimization is to accommodate number one growth of the bank number two maintain potentially strengthen distribution of funds to our shareholders as long as we believe that the cost of distribution of excess capital can be outperformed by investments of our shareholders so should it cost 15% For us to optimize the capital on the released capital, we will not do it, obviously. So we are looking for some reasonable equilibrium in what cost it brings and what benefit it might provide to the shareholders. Mentioning the capital, you should expect growth at a similar pace, slightly improving. As we have drawn the performing portfolio at the level of 6.3%, 6.8%, I'm sorry, I always underestimate us. This is the growth of the performing portfolio. portfolio and gross portfolio 6.4% I think in your assessment of the bank the safest way is to assume this on Sateros Paribas basis but the main the improvement that will come is on the mortgage book as we currently have pipeline of about 23 billion in transactions and we have currently 3.3 billion of balance sheet commitments. So we are confident, I'm trying to say we're confident, that we will fulfill with some peace the operating plan of the bank for the 2026. Nonetheless, it is not in our interest to rapidly grow the mortgage book. If you look at the guidance, and the portfolio shape is visible from, I hope it's visible from that. We see it as a retention product for our customers, number one. Second, we want to be competitive in the market of refinancing transactions which are 55 LTV and below, and we are very successful with that because if you look at the pipeline structure, about 50-55% of that constitutes refinancing of our competitors and we are able to create value on the refinancing transactions particularly as they have low LTV established repayment history and some credit strength so we are focusing on the subsequent of the market, which is irrelevant. It is the totality of production of mortgages in the Czech Republic. So this is on the long road. On the Middle East, the short answer is that we are not at the point of creating overlays at this moment. We do not want to overreact to it. I'm sure that we will have a discussion about that. But currently, as the markets in the U.S. are shrugging off the war, we want to see what will be the development of growth and inflation numbers during May, June, and obviously April, because April will be partially impacted by that. and then come July we will assess that situation and decide whether we need to do something on overlays or not so I will hope I'm not promising this but I will hope we will have a very clear answer on this part of the question on the 24th of July Super, thank you very much

Thank you. As a reminder, if you did want to ask a question and you have joined us on Zoom, please use the Q&A function or raise your hand. If you've joined us on the telephone lines, please press start followed by one on your telephone keypad. We currently have no further questions, so I'll hand back to Mrs. Burney for closing remarks.

Well, we are tremendously grateful for your participation. We are grateful for the attention you pay to Moneta and we are committed to deliver not only the minimum target, but as I said in the very beginning of the presentation, our aspiration is to work as we have done in previous years and with that we wish you a successful rest of the day and very good weekend and we are looking forward to seeing you either at one of the events that we plan in terms of Roadshow and other events or at the next management conference call which will take place on 24th of July 2026 and with that thank you very much and good night

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