Oversea-Chinese Banking Corporation

Welcome to our first quarter results briefing. So I guess we go straight into it since we're all familiar faces. Let Chini start.

Good morning, everyone. Thank you for taking time to join us today. For the first quarter of 2025, group net profit was S$1.88 billion, up 12% quarter-on-quarter, but down 5% compared to the record quarter a year ago. ROE was 13%, on an annualized basis. Total income grew 7% quarter-on-quarter and 1% year-on-year to $3.66 billion. Net interest income was 4% lower at $2.35 billion against a backdrop of declining interest rates. I will cover more on NII in my later slides. Non-interest income increased 36% QRQ and 10% year-on-year to $1.31 billion, driven mainly by stronger wealth-related fees, trading and insurance. Cost-to-income ratio improved to 38.7%. Against last year, loans and deposits grew by high single digits. Asset quality remained healthy with NPR ratio at 0.9%. Total credit costs were higher at 24 basis points on an annualized basis. We adopted a prudent approach to set aside additional preemptive allowances in view of the current macroeconomic uncertainties and heightened geopolitical tensions. Our capital position remained robust. Transitional common equity tier 1 ratio was 17.6%. Fully face-in CET1 ratio was 15.5%. Moving on to slide 5 for performance highlights of our three key business pillars. The strength of our diversified franchise is reflected in the performance across our banking, wealth management and insurance pillars. Banking operations profit was unchanged queue on queue. Our 15% increase in non-interest income compensated for the lower net interest account. Wealth management income and assets under management were at record highs. Wealth management income was 29% above the last quarter at $1.37 billion. It now contributes more than a third or 38% of our group's total income. AUM rose 2% from last quarter to $306 billion from continued net new money For insurance, its profit contribution from GEH increased significantly to $322 million. This was driven by stronger investment performance as well as underlying insurance business. If you recall, in Q4 of 2024, we recognised a one-off negative impact from the changes in the medical insurance business in GE's key markets, Singapore and Malaysia. Turning our attention to net interest income on slide nine. Net interest income for first Q of 25 was 2.35 billion, 4% lower compared to a quarter ago. While average assets grew by 3%, this was more than offset by a narrower NIM and the effect of a shorter quarter. NIM compressed 11 basis points quarter-on-quarter to 2.04%. This was partly due to the declining loan yields in the first quarter of 2025 after taking in the full impact of the Fed rate cuts in late 2024. Almost three-quarters of our loan books are denominated in Sing Dollar, US Dollar and Hong Kong Dollar. And these are predominantly on floating rates. Notably, the pass-through effect was more pronounced for Seng Dollar and Hong Kong Dollar rates, which experienced much sharper decline compared to the Fed rate cuts. Consequently, the decline in our loan yields outpaced the reduction in deposit costs, which typically reprised much slower than loans. In addition, NIM was NIM also declined as part of our planned effort to defend that interest income as we intentionally deployed deposits to grow our liquid assets. This was part of our active balance sheet management strategy to defend our income over the long run, especially as we expect further Fed recuts in the second half of this year. Our exit NIM for March was 2.03%. As at the end of March 2025, NIMS sensitivity based on one basis point drop in rates across our four major currencies of SingDollar, Malaysian Ringgit, Hong Kong Dollars and US Dollars was around 5 million on an annualized basis. Non-interest income grew to reach $1.31 billion. The growth was underpinned by higher wealth-related fees, trading and insurance income. I will elaborate more on our fees and trading income in the next few slides. Fee income for first Q of 25 was up 6% Q on Q and 14% year-on-year, led by higher wealth-related loan-related and investment banking fees. Total fees also reached the highest level since the start of 2024. We continue to see good momentum in wealth management. Both wealth management fees and assets under management delivered double-digit growth year on year. Our AUM rose 12% to $306 billion. led by continued net new money inflows. In first Q of 25, we saw net new money inflow of 5 billion Singapore dollars. About 60% of our AUM are placed into investments across all our world wealth segments. For the first quarter, trading income moved 31% quarter-on-quarter to $396 million. This was underpinned by stronger customer flow and non-customer flow trading income. The rise in our customer flow trading income was contributed by both wealth and corporate segments. Turning on to operating expenses. Operating expenses for the quarter declined 9% from . The reduction is largely attributed to the higher costs incurred in the fourth quarter of last year to fund our strategic initiatives and to pursue loan business growth. Cost-to-income ratio for Q1 of 2005 was below 40%, I mentioned 38.7%. Turning on to portfolio quality, our overall loan portfolio quality remained resilient. NPL ratio was 0.9% lower than a year ago. We have reviewed our portfolio and assessed that trade tariffs have first-order impact on 3% of our loan book. We further stress tested our portfolio for potential vulnerability and assess that our portfolio remains resilient. First Q25, total allowances were $212 million, up from the prior quarter and a year ago. This was mainly driven by allowances for non-impaired assets. Allowances set aside for non-impaired assets was $118 million, comprises mainly the pre-emptive allowances that I mentioned earlier. Total credit costs for the quarter were an annualized 24 basis points within our credit cost guidance of 20 to 25 basis points. Cumulative allowances rose for the first quarter as we continue to prudently set aside allowances. Our group's NPA coverage ratio continued to trend higher to 162% as of March 2025. Allowances for non-impact loans were at 0.9% of total performing loans. Loan portfolio continued to be well diversified across geographies and industries. Our group loans grew 7% year-on-year to $322 billion. We saw increases in residential mortgages and corporate loans led by the transport, storage and communications sector, which is in line with our group's strategic focus to capture opportunities in the new economy sectors and high-growth industries. By geography, the year-on-year increase in loans was led by growth in Singapore as well as in our overseas markets such as the UK and the US. Our group's strong and stable funding position was supported by customer deposits which represented about 80% of our funding base. customer deposits was 9% higher year-on-year at $403 billion from both CASA as well as fixed deposits growth. Over the same period, lower-cost CASA balances grew by 12% while CASA ratio improved to 48.9%. On capital, our group's capital position remains sound with transitionary CET1 ratio at 17.6% up from 17.1% in the prior quarter. The increase was mainly from profit completion. CET1 ratio would be 15.5% on a fully phase-in basis. Proforma CET1 ratio will be at 14.5% after the payment of our final and special dividend for FY24, which will be paid today. That will bring us closer to our target of 14% CET1 ratio. With this, I end my presentation and pass the floor over to Helen.

Good morning everyone again. I think Chien Yeh has delivered quite a lot of information. I just want to maybe add a few points. I think overall, our first quarter results does reflect the strength of our diversified business franchise, which enables us to deliver a very resilient set of results. Total income grew quarter-on-quarter, supported by broad-based non-II, across fees, insurance, trading, etc. This more than offset the lower NII. Wealth management, income and AUM are doing fine, they are record highs. and actually talked about $306 billion and rose $7 billion and actually $5 billion is from net new money inflows both in Bank of Singapore and also our CFS business on Premier, Premier and Premier Private. So cost and income ratio came back down below 40%. but it is important, 40% important that we continue to exercise a very tight cost discipline in view of the uncertainty in the market. Sometimes people always ask me about investment, are you stop investing and all that. I think we have to look at it in two ways. A lot of investments is just is building also for the future. Some are invested to continue to make your BAU or your business as usual better. But there are costs that are variables that we can have more discipline on. It is those costs that we can... I mean, in a worse market, for example, maybe you travel a bit less. Maybe you do less marketing costs, right? You hold a few fewer events, but it doesn't mean that you are not doing things because your clients are expecting you also paying more time, more focus on helping them as well. So we will continue to execute a very tight cost discipline. And with this say, we continue to see deposit and loan inflows as well. Asset quality, we want to highlight NPR ratio at 9%. We always took a prudent approach to look at whether we are comfortable with our allowances. And given the uncertainties in the operating environment, we did say that we put aside more ECR 1 and 2. And we continue to be very vigilant on how we underwrite transactions, how do we monitor our portfolio, doing the right stress test, looking at how we do it and indeed a tariff situation. We're quite prepared for it and indeed has already think about how our portfolio is like. I think Julie talked about first order of impact. Of course, you define, you look at the industry your customers are in and talk about what are the second order. And ultimately, those customers, that is what we call a safer portfolio, which is a predominantly more domestic portfolio. domestic driven. I mean, the demand and the business is more domestic. And this includes utilities, local real estate, digital centers. You talk about financial intermediaries, etc. This would be the sectors with a strong domestic focus that would be much, much less impacted by terror. So we are very prepared and we analyze and do stress tests like this. We also focus on achieving our strategic goals despite uncertainties. So we're saying that performance for the first quarter was resilient, but indeed focus is on the future. On the future is I think you all know we talk about announcing 2023, a three-year plan of bringing incremental revenue, right? So as two years has passed, we say that we overshoot our target a bit. by the end of last year, by achieving close to $2 billion out of the three, was supposed to reach $1.5 billion last year. This year, with what we have done well, exceeding our target last year, I think we are quite comfortable still to deliver the $3 billion this year. But we don't stop there, right? So actually well in advance in last year, we look at what is it? Is our strategy still valid? What else are we doing in order to continue to be able to grow our bank and grow the group and also have our customers going into the future? And you recall last year, we set up a strategy and transformation division as early as in April last year. and we know, I mean, as we look at the world, right, and we're quite well prepared for the type of situation. I talk a lot about being vigilant on your portfolio, but also how do we react and how do we plan, right? And in our strategy, we have a special focus on handling a situation like what we see today, right? Of course, nobody exactly know what Liberation Day means and how much is a tariff that was sort of talked about, right? But what we're seeing is we have been having a strong focus on how we deal with situation like this, So we have a focused team working on situations. So stress testing is one thing, but thinking about how that impacts our customers, how does that impact our own revenues, where we have to tighten and where we have to actually expand to capture more revenues, these are all in the planning. and with a very focus, a special focus on what if the world become like this or what if the world become not like this. So I want to emphasize that. And of course, IMF in reaction to the term situation have also forecast global growth downward, right? And escalating trade tensions as well. So it is indeed a very unpredictable environment, but the whole point is about being nimble to recognize the potential impacts, but also limbo to identify the opportunities that arise and then invest in, plan to invest in the right manner so that we will be able to continue to deliver resilient results. Also actively engaging our customer and preparing them. So just to want to say the first quarter, we did say wealth management fees are fine and stock market was doing not badly, right? and indeed want to just give you a data point. And that particular week of very high volatility, we actually have very low amount of margin calls, meaning we talk to our customers well in advance to prepare for uncertainty. If you're not prepared, maybe there's a lot of customers that suffer, right? So I think we support all of this with a very strong balance sheet, as Chin-Yi presented. our capital position and indeed our well-diversified business franchise has helped us to deliver this balanced earnings throughout the cycles. So flipping the slide, in view of the uncertain macroeconomic backdrop, we're still keeping maintaining our financial targets for the reason that, as we said, we have plans to hopefully to achieve these targets. Doesn't mean that this is set in stone, right? The market is still uncertain, but at this point, we do want to maintain the financial targets. The exit limit in March is 2.03%. We still plan for three rate cuts the rest of the year, but we don't know yet whether that would suddenly come. It looks like that potentially not in the second quarter, but maybe at the end of the second quarter, right? So we have actually attracted more divorces and then invested in liquid assets, as Jeannie has said. The target growth in liquid assets for the first quarter has been achieved. We will moderate the growth of liquid assets in the coming quarters. We have also announced the lowering of some of our deposit pricing. So this will be able to help us to proactively manage our funding costs. So we'll see. We'll continue to be vigilant and look at the situation. Loan growth, we maintain at mid-single digits. Though if you look at these five points, I would think which ones probably see more happens is probably really low growth, especially if the market continues to be very uncertain. Doesn't mean that we don't engage customer and customer don't need money. Refinancing is always there. And we do think that there will be some flag to quality, meaning we probably will be able to continue to keep customer relationships well. and continue to take in more deposits and with customers talking to us about their investment needs. But if the economic situation is going down, meaning economic growth is slower, of course, loan growth will be lower as well. So cost-to-income ratio, we maintain low 40s. and credit costs to remain between 20 to 25 basis points. And I really want to say that we remain committed to deliver the 60% dividend payout ratio, which we have announced, and coupled with our share buybacks over a two-year period, which we have started. So, of course, bearing unforeseen circumstances, right? But it is what we are working towards. So with that, I pass it to Jingjing. Thank you.

Congratulations on a nice beat and lowest NPL ratio among the three banks. My first question, could you give some colors about clients' demand for hedging both for interest rates and FX? My second question, I just want to ask Chin-Yi, you said that new money for the wealth management, about $3 billion, $5 billion, wouldn't you give a bit of an alert on where they are from? Third one, why do you not

I'll start with the first one, which is about customer demand for hedging. Customer demand for hedging is always there and I want to say that I think with I think the whole market has been a lot more disciplined after the last financial crisis. When you say discipline, meaning banks are very much there to help customers to manage the currency risk and interest rate risk. A lot of times, hedging doesn't come when we're perceiving a crisis coming or an uncertain situation coming. These days, most of the time, if you look at customers raising money, a hedging proposition always goes along with new borrowings. So, hatching discussion is a day-in, day-out thing. It is really like talking to customers all the time. This is a very strong part of our discipline in our customers planning, helping customers to plan. So, if customers have more a lateral hatch, meaning if they buy and sell in the same market, in the same currency, hatching needs are lower. So, to an extent of domestic customers, hatching needs will be lower. but we are serving a lot of cross-border business of our customers. So that hedging is particularly important, especially if customers are having a longer-term financing, let's say a buy-in financing. They will always look at the currency hedge and also particularly some interest rate hedge as well. So is there a heightened demand for hedging? I wouldn't say so. but it is always, as we said, we want to anticipate what can be coming and advise our customers accordingly. There's certainly more conversation in managing the volatility. Conversation meaning you would tell the customer... I mean, I was just using the margin call as an example. That is not hedging. But if you are financing very actively into investments, meaning you are not hedged now, you're exposed, right? Even financing is definitely a form of exposure. When we think margin call is, there are two ways to make sure your position is safe, right? First is not to take over too much leverage and high risk, right? because otherwise when price come down, you suffer. Similarly, if you're exposed to ethics, if you're exposed to interest rate, you also can consider hedging, which is something we always provide to customer. It's not, let's say it's a hype of it. It's not that it's a hype of it because it is not suddenly where you see perceived as uncertainty, you start to hedge. for normal business, for maybe you can say for individuals, whether they would then actually have a choice of a preference to say that they unwind certain investment. Yes, that can happen. It is a form of hedging as well.

So just to be clear, you are not seeing, I mean, your clients are generally adequately hedged because it's an action taken for all these uncertainties. Did I understand it right? Yes.

You can say that, meaning there would be enough conversation on how they hedge or they protect their exposure. But ultimately, it's client's choice, right? If they don't want to hedge it, it's client's choice. If a certain client decides to take a certain position, it is their choice, right? But when we say we're very diligent with our book, it's you do want to identify what clients are. are less prepared. So that is exactly what we're seeing. And that is why we have stress tests. If this comes, assuming some of our clients are not protected, what's that impact on our book? So when we say tariffs come, it's a form of uncertainty, and we look at first-order impact. First-order impact meaning industries that is more in manufacturing and international trade that is have more relationship in doing business with China and the US. That's what we call first order impact. And this, you know that. I mean, nobody can completely hedge for any uncertainty. So you cannot say, you have to say that they have considered the risks and that everybody is, we are comfortable, that our clients are comfortable themselves, that they have reached a position that even there is uncertain risk coming in, you can breeze through it. Because there is nothing like a 100% hedge. 100% hedge, that means you are not gaining the benefits of that, the upside. I think you're asking about the

why we don't disclose LMS to AUM? Is that your question?

Yes, this is the third question, but there was a second question. So then there's another question. That's the third question.

Yeah, okay. So the reason is that I think we also received feedback from the investment community because our other peers are also showing that AUM, including consumer and private bank, we used to only show private bank. So by putting in LMS to a consumer bank, they are able to compare apples to apples in terms of the overall AUM The 5 billion net new money is actually coming from both Premier, PTC as well as Bank of Singapore Business.

Premier Banking, Premium Private Client.

So if you look at it, I mean, it may be easier to see if you look at the Bank of Singapore, if you look at the year-on-year growth, it's actually coming from across. So in the AUM increase will come from Indonesia, Philippines, across ASEAN. Also, if you look at it, year-on-year will be also like Greater China, the markets. So I think it's quite Thank you.

Joby?

So just a few questions here. The first one is just, you mentioned the first order effects of tariffs were effective as a problem book. Could you just provide some colour of that, which sectors and which geographies? I think we have an idea here, just to be sure. And I think following on that, what about supply chain or normal effects, your second and third order risks? You mentioned your portfolio in billions. Could you just provide some figures of factors that may affect that, especially when the tariff course ends? And then I have a few more, but just these two for now.

First order will be manufacture and production of goods, right? But excluding at the moment those that are not in the tariff, right? So at the moment, pharmaceutical, semiconductors and certain integrated circuits, those are not in the tariff yet. Another category is international transport and storage of goods. And then you have more materials and commodities. These are very subject to the tariff impact. So we say that together this is about 3% of our book. And then you have another category, right? What about the next, what can filter through whether there will be tariffs on pharmaceuticals as we said, right? And then wholesale traders, right? So this is what you call the second category. And then you look at the third category that have mostly domestic focus will be less impacted. Yes, maybe the supply chain may be impacted, but those who are very much focused domestically also mainly source domestically as well. And they are, for example, they are the service the service sector, right? The F&B, the service sector. And when you typically, yes, I mean, you buy food import, but that is not so much impact because you are very domestic focused. And then the utilities is domestic focus. And then you talk about local construction, local real estate, residential real estate locally, data center, This will be less subject to tariffs in that sense. Financial intermediaries. So I think if you say geography, you then look back into your loan book. And if you look at our loan exposure, Singapore is still the biggest. And for the Greater China Book, still very little onshore in China, very much comprised of offshore and Hong Kong. actually, of course, again, quite a lot in Singapore. So we do look at it that way and we stress just differently how we stress the different categories.

Can I check your NIMS sensitivity outlook for the year ahead? Is it still going to be 5 million to be 6.5 and 2035? Yes.

Okay, I'll change that.

And then your exit NIMS for March was 2.03. Can you share your exit NIMS for April if we have that? to be looking at other metrics like ROE, for example?

I think when we're ready, but not necessarily a revenue target. I think as we step into the future, of course, trade tensions is one very important thing, right? But we're also looking at something that is, again, also very big. Into the future is the use of technology and AI, right? And what's the nature of your customers maybe changing as well? and I think sustainability is still a topic. Some people said that, oh, the US is not focused on it, but it doesn't mean that the world doesn't need it. The world still needs it. And so I would think we have already, to an extent, come a lot into capital planning as well, right? In the past, we shared maybe a lot less, but today we share a lot about how we plan our capital as well. to face the future. And I think three years back, it is the right time as you know the market interest rate is going up and you know by pulling ourselves together, working as one team, you will have a lot of initiatives that would capture incremental revenue. Into the future, it will be a lot more uncertain. So to an extent, we have to be very vigilant about our capital and I mean treat our shareholders correctly like the share buyback plan and then we need to be able to have a strategy that will be able to keep us resilient, diversified and so that an increased customer flow so that we'll be able to defend our income as interest rate come down further but also to be able to build a lot more into our wealth so that if If we can step in more stable environment and at a low interest rate scenario, customers will invest a lot more again. So it is to make sure that we're resilient enough to have a strong capital, manage our funding costs, expand our customer base, and then devote more and hopefully achieve more contribution by NII going to the next three years. So, but if we do have targets and plans to share, we will share.

Helen, you mentioned that the bank has commenced share buybacks. Can you get a bit more colour on the 2.5 capital distribution plan? How much shares have they bought back and also the special figures as well?

Actually, share buyback is distributed every day on the stock exchange and we will go steadily. So we have a target, but it doesn't change our plans. I mean, the capital planning includes the dividend. That's why we committed for both years we would have a special dividend of 10%, right? So that plan doesn't change. But share buyback, you don't time the market to an extent. and there are also stock exchange rules on how much you can how much you can acquire you know say any single day.

Hi Helen, can you please give us a

I wouldn't say this is a worst-case scenario because we say the market is uncertain. So I think we are prudent because if you look at the book, you don't need to set aside that 82 minutes, right? Actually, if you entirely base on economic factors based on your loan pool, what we call an overlay is because of the uncertainty. So if the uncertainty persists, let's say the second quarter, something very different happened. I mean, you still count towards that end of the 90 days, right? and the negotiation between countries, right? So if there is more clarity, you may not need to put up more. But if the uncertainty even worsens, that is no one can predict, then yes, we may actually provide more. The important thing is we have to be comfortable at a level based on how we test our book that we think this is the right amount that we are taking. Another impact is what we call the macroeconomic factors that may actually impact how we make our provision. Of course, that is according to market. And then the overlay is according to uncertainty. So I hope we'll be less uncertain. Indeed.

Hi, Alan.

Thank you so much for the sharing. And I have two questions. One is about the trade shifts. and another one is about your outlook for the SME. So the first question would be, are you seeing any changes or opportunities or challenges in terms of the trade shift soon caused by the Paris chaos, maybe like intra-ASEAN or from China with other ASEAN countries or the rest of the world? And the second question is, Can you give us more of your thoughts or your assessments in terms of the SMEs, the banks SMEs customers? Because we know like maybe the SMEs, they don't have as much as of resources like the big companies to cope with those scales and the challenges ahead.

Yeah, thank you. The first one, trade ships is a very interesting topic and very important topic. Just have to say that customers, if you think about the first The first Trump administration. There was also a lot of discussion on tariffs, right? But even before that, I think trade tension between China, predominantly China and US, actually started way back, I think, around 2015, 2016. So the China plus one story has been true for many years. and you already see China's plus-N story happening, meaning they try to prepare, not just focus on a factory in China and a factory in Vietnam. And if you see China business going out, they have already diversified, not just in manufacturing. They have diversified in tapping the ASEAN market and a lot go for other resources in ASEAN or go for the population in ASEAN as they go out to try to sell the products as well. So if you talk about manufacturing, it cannot happen in a day. You cannot say that because now the temperature is high in Vietnam and a bit lower in Singapore. I then try to build a plan in Singapore because that's not going to happen because you still always have the cost concern, right? But the other thing is, what if the tariff is changed after another quarter? So you don't plan it like that because manufacturing cannot be shifted in a month's time or you want to build something that has to be built in a year or two years or etc. But what most bigger customers, bigger corporates have done is they prepare for the future. So having a diversified manufacturing base is important, and where you source your materials is also important. But over the past few years, obviously, you see a lot more intra-Asia flow. And that is why ASEAN becomes the largest trading partner for China and vice versa. So in a way, a lot of times when people talk about China facing the tariff, it's always reflected that actually China's exports to the US is only 2% of the GDP. In that sense, so you can imagine China over the years have also been shifting their trade partners as well. So would there be some shift? I think yes, supply chain is always easier to shift. When you say I tend to buy more from this country, but if any good business, if they do plan correctly, they always have options which they can switch from time to time. So would trade shift happen? Yes, it will. It will continue to shift, but it would not happen in a day or in a quarter. But as likewise, because we're a regional bank, we look very closely at all our customers and engage them in conversation even more intensely in a period like this. Then your second question is about SMEs. SMEs in general, unless you are very trade-oriented SMEs, where you actually buy from selling countries and sell to very different countries. If you're talking about domestic SMEs, they are more subject to local economic growth situation. So this is what we, day in day out, have our SMEs to face. How to strengthen them, have them to do business, make sure that they are easy in dealing with their money, make sure that the banking services to them and the advice to them is there all the time. Where SMEs are more impacted, like what we say the first order impact would be on international transport, storage, etc. This will impact those SMEs that are servicing this industry. So we have to be careful and look at them, see how we continue to help them. actually shrink some of their investment plan so that they preserve some of their resources when the market returns, they may have to do that. So this is something we engage the customers all the time.

Why don't you refer to our course, our events and our course?

You said more on the course. Can you expand more on what some of these examples on the sort of events you're looking at or and then also on the course, right, on operating experience, 5% year-on-year and part of the reason was on salary adjustments. So staff costs would be something that the bank looks at in the coming quarters when you talk about financial discipline and things like that.

I think looking at improving staff productivity is an ongoing thing, right? If you can, the flip side of a managing course is you improve productivity. And earlier on, I talked about use of AI, that's something very important. That's what I'm saying. Actually, that was what I'm referring to as well. Profitability and what's the opportunity AI can bring as to new products and new way to serving customers. A course is, yes, is the highest, but surrey costs always reflect the market. If that is economic weakening, then of course, I mean, the whole world will reduce the surrey increment. So that is a natural response to what is happening in the market now. But I think that one of the things that if you can improve your productivity, then you don't need to hire as many. You can slow down your hiring plans, for example. or if there is natural attrition, you may not need to hide to be placed. When we say discipline, you have to watch this very closely. I did mention traveling. Yes, we travel a bit less. COVID taught us to be able to talk to everybody online. So, of course, in a very rapid growing market, you tend to actually travel more to see your team and then You organize things for your clients. So in the market that is shrinking, there is in a way no need to do that. Or you would actually apply more discipline in doing that as well. It's how we spend our money, I think so to say.

Shania, your last question. At fully loaded CET1 ratio, 14, right? How much is your excess? 14.5. What's the excess capital that you have? Excess. Shania, have a good answer on that. Yeah. Suppose you can work it out mathematically. We don't really disclose like excess capital.

to say that we announced our $2.5 billion capital return plan. That takes you to income, how we look at excess capital, what are the excess needed to navigate uncertainties, so on and so forth, and support business franchise growth, and come up with the $2.5 billion.

More than $2.5 billion in excess capital. Mathematically, you can also work that out. The PBOC is encouraging all the Chinese banks to lend and you've got this 19% stake or is it 20% stake? Is that included in those banks that the PBOC is encouraging to lend? Because some of them have raised China regulators in period of economic situation always have certain guidance

for banks, right? And the biggest influence is on the centrally owned, the larger banks. So Bank of Ningbo is not owned centrally. Bank of Ningbo is also a listed bank in China, and it has a range of different challenges. Yes, of course they have to do their part in support the economy, but they also have a very, I would say they have There are things you generally follow. For example, regulators sometimes will give you a target that your lending to SME cannot be slower than your loan book growth. Is that right? Sometimes there's guidance like that. I'm just giving you past examples, right? Past examples. Many of them you don't choose to support only one sector of the economy. So banks in general, you have to follow. But it doesn't take away how you judge your customers and who to lend to. Lending doesn't mean that you just have to lend regardless, without putting in your risk management parameters. So Bank of Ningpeng, I want to say...

I think just to be mindful, Bank of Ningpeng is an associate company, so there are

What I'm trying to say is they also apply good business principles and risk management principles.

Are they likely to raise capital? If they need to raise capital, will you support them? If not, thank you very much.