Raiffeisen Bk In Unsp/Adr

Good afternoon, ladies and gentlemen. Very warm welcome. Thank you for joining the call today. Talking about first quarter, profit was up 22% year on year, driven to a large extent by lower risk costs. On the revenue side, net interest income was stable compared to the fourth quarter in 2020, and net fee and commission income has now almost recovered to the Q1 level of 2022. We are seeing positive signals in some of our markets as yield curves begin to steepen. While this is unlikely to have a major impact in 2021, it is nevertheless a step in the right direction. Loans to customer grew by 1.3% in the first quarter with some support by FX movements. In retail, loan growth was primarily driven by mortgage loans and to a lesser extent by personal loans. In corporate, New lending was mainly short-term. We expect loan growth to remain modest in the first half of 2021, but for the growth rate to increase in the second half of the year. This assumes primarily organic growth, and there could also be some additional support from exchange rates. This does account for the consolidation of Equibank. With respect to the acquisition, we still expect the transaction to close in the second or third quarter, pending on regulatory approval. The ING transaction in the Czech Republic is also proceeding according to plan with over 75,000 customers recontracted to date. We issued green bonds during the quarter and continuing to do so. You are aware that Slovakia came with 300 million Euro Green Senior Preferred Bond in April and today we had an inaugural Green Senior Preferred Bond in Romania, in RON, if you're also interested in that currency. And we expect more from our Czech entity as well throughout this year. When moving to the next slide, you see a little bit more details to the P&L. I already have mentioned the net interest and fee and commission income. I think I can refer to the costs as overall in a positive development, but here be aware that we have also a new definition of the cost-income ratio. Overall, this leads to an improvement of the operating results on a year-on-year, quarter-on-quarter basis, and a minus 18% on a year-on-year. And to the risk costs, which are substantially improved, Hannes Mersenbacher will give you later on more details. When looking at slide six, some more insights to the core revenue trends. I have mentioned previously that we believe that net interest income has now brought them out, and you see this in the numbers of the last three quarters. The first quarter was somehow impacted by maturing hedges and their repricing. But now most of the structural interest rate positions have been repriced and their contribution to the NII is expected to be stable in the coming quarters. And the rate hikes, what we have seen in Russia and Ukraine, should be supportive. We saw a positive trend in the NI and Net Fee and Commission income in the last weeks of the quarter and this makes us quite optimistic for the rest of the year. You have in the lower right-hand box also a detailed overview of the fee income. You are aware of the seasonality which we have at the end by some of the commissions by card partners being paid always in the fourth quarter of the year when comparing first quarter this year with first quarter last year and considering the substantial restrictions what we still have in movements if we compare the two I think that the number is good and gives room for positive optimism in the course of this year When moving to the next slide, and here before we move, I should say that, and you have heard this also in the last couple of calls, in these days, The net interest margin is not that informative as it usually had been. You know, we are flooded with liquidity and also the central bank supportive measures make their way to our balance sheet and by thus diluting a little bit the net interest margin. When looking at the segments, Yeah, what you see here, as I mentioned already, decrease in the net interest margin in most of our segments. As I said, this comes from the high liquidity in these countries.

Loan growth.

you see is in all the markets somehow visible, but as I said, modest at the beginning of the first quarter, but it's visible now. Now, quite a lot of contact with customers, quite a lot of interest. Maybe there's still more discussion than real drawing on investment loans, but we believe a pickup will come also in the unsecured loan in the second half of next year. You still see on slide eight, you see the volatility in the various loan products. You see the stabilizing in the retail area. and the volatility in the long-term corporate spot. Moving to slide number nine, we have almost stable CET1 ratio. You see that the ratios in comparison to the requirements, a very stable picture on slide nine. And the impacts of the development of the first quarter is visible on slide 10. So minus 18 basis points impact from the credit risk. Some additional impact from market and operational risk effects not visible and retained earnings are compensating for that so that we almost end just seven basis points below what we had at year end. You are aware that the dividend was paid out in, so not had been reflected and is not relevant the way we handle it for the CD1 ratio. The 48 cents had been paid out on the 30th of April and we keep the intended dividend of 19 for the business year 19 still in the profit carried forward so that this gives us another opportunity maybe by the end of the year in the fourth quarter for another dividend payment when talking about liquidity you see that the on slide 11 you see that the Huge liquidity, this enormous liquidity is dominating everything in our balance sheet. And of course, the offer from the TLTRO finds its way also in the balance sheet. Currently, we have drawn around $8 billion, $5 billion on head office level, and Tatra Panka took another $3 billion. If we move then to the next slide, which is Poland, and I'm aware that currently there is a communication by the Supreme Court, the Senate of Seven Judges, on the question of statute of limitation and the theory of two convictions. Here I rather give and I cannot in detail comment on that. We will have to look it up. We also had a ruling by the European Court of Justice on the 29th of April to request of the PPH case. I find this ruling very informative, very clear. After our Tupiak case, the direction for legal experts was set rather clear. For non-legal experts like me, it still was difficult to fully understand the intention and the ruling of the European Court of Justice. I think the The very good thing of this ruling now is that it's very clear stating that indexation is not something which is unfair or abusive or whatever. It's one way to create the Swiss franc loan. We also understood that there is a clear declaration that invalidation of contract is only the last resort to resolve case. But the main goal should always be the reestablishment of a balance between the consumer and the bank. And even more so that it's not up to the customer's wish to decide whether a contract shall be invalidated or not, but it's an objective court decision. depending on which parts of a contract might be ruled as unfair. It was again a strong statement that for the consumer there is some support by the court, or putting it in other words, the court has the obligation to inform the customer in detail about the consequences. Following the public discussion, I think it's also important to read in that resolution that invalidation of a contract cannot constitute a sanction against the bank, but it's just, as I said at the very beginning, the last resort to resolve the issues. Personally, I'm I also think that the statement on the blue pencil roll might also create quite a lot of certainty for all this. What does it mean for us? We have a portfolio, just an update for you, of around 2 billion euros in Swiss francs, 31,000 loans. Amortization in the range of 100 to 110 million, so very long-term. High RWA weightings of 118%. Huge number of cases pending at courts, more than 4,700. Recently, we had an inflow of 250 to 300 cases per month. We will see if the ruling what we have seen today in combination with the ECJ ruling, and there's another one announced by the full, by the Supreme Court and the full civil chamber to the six questions which had been asked by the president. And then we will see if this changes anything in the inflow. Coming to the future. Macro outlook, of course, this is on slide 13. It had been, of course, adjusted quite frequently depending on the restrictions from the pandemic. The overall picture is very optimistic. I think everyone is seeing now that vaccination, which compared at least to our expectations probably, started relatively slow. Maybe we were just having too high expectations. But what we see now is that the speed is picking up substantially so that in the second quarter, I believe that many, many people in most of our countries will be vaccinated, at least those who are willing. And with that, I think normal life is back in the service industry, consumption, hotels, restaurants, and we anyhow have seen a strong growth in industry output and also in trade. We always see the headlines that many big markets were recovering very well. So we have a nice forecast for 2021 and a very strong forecast for 2022. If asked, What would it mean in terms of loan growth? We had been asked several times this question in the past, so we added an additional slide, slide number 14, where, based on Raiffeisen research, you see a split between retail and corporate forecasted loan growth in our countries in local currencies. And not to a surprise, I think what you see here is that Hungary, having a different way by the government to deal with the crisis, will keep a double-digit loan growth. Others more, but every, in all the markets, I think it's nice. It are nice growth numbers. And this year, as well as next year, only Croatia, which suffered because of the tourism impact, the structure of the industry substantially last year, and there is a question mark this year. But what we hear is that the country is getting ready to host quite many tourists. Some of the hotels are Of course, we've reduced capacity already open. Those who go there enjoy it very much. Everyone feels safe, handled in a very careful way. Our colleagues in Croatia are very kind. very optimistic and what I report about spending sometimes at the sea does not come from the Croatians, but from people coming from abroad, because tourists from abroad is very important for Croatia. So overall, a very nice picture and And of course, if it comes in the second half of the year in the NII, we will not see the full impact as this is only pro rata, of course. But we are very optimistic that it builds a nice long book until the end of the year and also in the coming years. Coming to our targets on slide 15, I can repeat what I said, modest loan growth in the first half of 2021, accelerating in the second half of the year. To the provisioning ratio, we keep the 75 basis point at the moment, as we have to understand what is the impact of expiring moratoriums and government support programs, but Hannes will talk on that in more detail. Cost income ratio, I mentioned before that we have adjusted the way of calculation. Some have asked, would you then also bring it down a little bit? Not at this point in time. So we keep the 55. Profitability confirmed again that we expect an improvement compared to 2020. We will not reach in 2021 the target of 11%. See at the one ratio, I confirm the 13%, as I mentioned before, the equity acquisition is not in the 13.6 included as of now, as the closing will only be in the second or third quarter. And I confirm also the payout ratio. And with this, I hand over to Hannes.