Banca IFIS S.p.A. (IF) Earnings Call Transcript & Summary

Good afternoon. This is the Chorus Call conference operator. Welcome, and thank you for joining the Banca IFIS Full Year 2024 Results Conference Call. [Operator Instructions] At this time, I would like to turn the conference over to Mr. Frederik Geertman, Chief Executive Officer of Banca IFIS. Please go ahead, sir.

Thank you, madam, and good afternoon, everybody. Welcome to our full year 2024 results call. It's a special call today. So we also closed the last quarter of our 3-year plan. We have some slides on this. I'm joined by our Chairman, Mr. Ernesto Furstenberg Fassio; and by my team, Martino Da Rio, Roberto Ferrari, Investor Relations and CFO will assist me in this call. And if you agree, I would take you directly to Page 4 and dive right into the presentation. So on Page 4, the results for 2024 in the fourth quarter. We closed the fourth quarter with a net income of EUR 35 million and the full year of 2024 with EUR 162 million net profits, basically up year-on-year despite a more challenging macroeconomic environment. You may recall the first half results of 2024 came out very strong, benefiting from an overall benign macro environment. Second half 2024 results present the usual seasonality. The core business is robust. Price discipline was maintained in a declining rate environment. And as you will see, we further improved asset quality coverage. To mitigate the sensitivity to declining rates, we've strategically extended the duration of our proprietary bond portfolio. And we expanded the share of our fixed rate business, especially in Leasing, preparing ourselves for the environment as it evolves. We have a very robust financial position with EUR 1.4 billion available cash, cash and equivalents that includes the counterbalancing capacity. And we have a CET1 ratio of 16.1%, very solid. The Board proposes total dividends for 2024 of EUR 111.5 million, that's EUR 2.12 per share, of these the EUR 1.20 was already paid on November '24, the 20th November of 2024 and EUR 0.92 per share will be paid on May 25. On Page 5, I mentioned the business plan. We closed it with this quarter. We had 4 key words: digital, open, efficient and sustainable. And we think the business plan was fundamentally delivered and from a financial point of view, exceeded. I will read this slide with you because we think the statements are important. Banca IFIS confirm its track record and reliable execution and value creation by the successful completion of the 22-24 business plan, sustainable recurrent profitability driven by our core business, net profits have been above target every single year of the plan. Very solid capital base and highly prudent liquidity position was maintained throughout the plan. You all recall that we repaid the TLTRO and maintained a higher liquidity position throughout, recognized leadership in ESG, as was testified by numerous external ratings and awards. We believe we currently represent the industry benchmark, especially in the S dimension of the ESG framework. Attractive shareholder remuneration through consistent semiannual dividends. The payout ratio is confirmed very close to 70%, both in '23 and in '24. Digital transformation of the bank is completed. Banca IFIS's new front-end platforms and internal processes have positioned it at the forefront of digital customer service. We believe we have fully accomplished the strategic business plan in terms of platforms and investments. And as testified by these points, Banca IFIS's controlling shareholder has a strategic and industrial vision for the group that presents a long-term value creation opportunity for all shareholders. I'm looking at the shareholder now, I think I can confirm. Page 6. Financial results exceed the business plan targets, just a few financials. We presented these in the last call, but now they are actual numbers and not projections. So let me just very briefly take you through them. Net income accumulated EUR 463 million in the 3 years of the plan, that's plus 11% compared to the target. And having increased with a progressive semiannual dividend policy, the payout ratio to close to 70%, that's more than 20 percentage points ahead of the business plan, leading to dividends of EUR 295 million over the plan, and that's 47% versus the target. The CET1 ratio, even considering this increasing payout ratio and in dividend payment comes out at 16.1%, and that's a full 100% -- 100 basis points north of the target that we had giving us the strategic flexibility to evaluate the growth options that we have shared with the market in the last weeks. Page 7, a few words on the transformation of the banks. I won't read every single word on this slide. We just wanted to share with the market the depth and the scope of the digital transformation that was carried out from origination, where you see some numbers on our multichannel lead generation, the way we attract customers, the numbers you see there have an industrial scale. The onboarding, we are now 100% digitally onboarding customers with remote ID solutions like SPID and others. We also have an instant onboarding process for retail clients, including a credit assessment, especially in the tech rental business. Going to risk and credit assessment, the underwriting process and systems were fully redone, including automated decision-making for the easier credit decisions leading to a significant part of our credit decisions, the numbers you see in there being made instantly today and therefore, alleviating the pressure on the underwriters. Time to Cash, significantly reduced. And finally, getting to aftersales, so client development. And here, you see the numbers of our current active SME customers interacting with the bank on these platforms. And I would say that especially on the Factoring side, you will appreciate that digitalizing after sales is a very relevant thing because there's a lot of continuous work, obviously, around the invoices, around better approval and that sort of stuff. So a lot also of time reduction in the sales process. So we wanted to give you a taste on some of these industrial elements, if you will. We could have made a similar slide on the NPL business. And also on certain regulatory investments that we made, where we invested in IT and in systems. We want take additional time. We hope you can take our words from it. But in any case, we are quite proud of the transformation of the bank on these industrial elements. Bringing you to Page 8, back to numbers. The revenues, net revenues in the fourth quarter were at EUR 167 million, was slightly down year-on-year. They're impacted by the rate scenario and the stickiness of the cost of funding, which was partially offset by very nice commercial effectiveness in the fourth quarter, both of commercial banking and in NPLs. Commercial banking revenues at EUR 82 million. The comparison with the third quarter was, you must recall that the third quarter was positively impacted by a one-off in Factoring. NPL revenues, EUR 81 million. The fourth quarter results reflected a very nice, we would say, development in the judicial workout, especially on the Revalea portfolio, which was brought on to our systems, therefore, leading to quite a significant contribution, Non Core and G&S at EUR 5 million. Page 9, we give you an update on the rate sensitivity that came up in the Q&A a few times. So we've devoted a slide to it. You see that by now, the scenario of a 50 basis point decrease in reference rates leads to EUR 6 million to EUR 8 million of net interest margin impact, further reduced compared to a few months ago, it was EUR 7 million to EUR 9 million, I believe, the last time we presented. The way we are going about this increasing duration of the proprietary portfolio and where possible, originate with fixed rate products that don't expose us to the Euribor. You will remember that our book is fairly short. So when we take these policies, these commercial policies, they tend to impact our overall stock rather quickly. Page 10, commercial activity, you can see that we are either in line with the market or better than the market, still maintaining a very, very disciplined approach towards pricing from the left Factoring 4% down turnover year-on-year but with an average spread at 3.5%, excluding commissions. So very profitable business. The market did a bit less, the minus 5%. Leasing overall, the -- we did plus 5% year-on-year, more or less in line with the market, that did 6% on equipment and technology. We see some confusion in the fourth quarter. You see the acceleration to EUR 131 million underwriting. That's also due to tax incentives probably, we still see an underlying trend of some delay of CapEx decisions of the SMEs. So notwithstanding this quarterly effect, which, in our opinion, is probably mostly driven by the tax situation for the SMEs. There's still some caution on CapEx investments on the side of the SMEs. Finally on the right, new Leasing in the Automotive segment, significantly above the market. The market did minus 9%, we did plus 6% year-on-year. And we always reiterate that we have a strategy there. We will focus on premium segments and on margin discipline, and we make sure that we don't have significant risk in terms of the underlying assets that are on our book. We finance businesses that have remarketing agreements in place. Page 11, the NPL business. So quarterly cash collections nicely above EUR 100 million, including Revalea and revenues, as I mentioned, at EUR 82 million. We concentrated, as you all remember, starting early 2024 on the Revalea purchase and integration. So we were quite selective, I should say, on other portfolio acquisitions. Revalea is fully contributing now EUR 8 million in the last quarter of 2024 in terms of revenues and EUR 12 million in terms of cash collection. So that book is behaving slightly better than we had expected very positively. And finally, the fourth quarter and the subsequent quarters will benefit both from the Revalea contribution and from the new NPL acquisitions that have restarted. So we're back in the auctions, and we are winning options in the last weeks, and we've started refeeding -- sorry, for the English, our book again as we did before. So Revalea is behind us and we're back to normal, I would say. Page 12. Costs. The quarterly costs are down year-on-year. That's very nice to see from EUR 112 million to EUR 107 million, Q-on-Q, the seasonality you would expect, right? So other operating costs are up EUR 7 million, mainly due to info providers, advisory costs a bit of IT projects that we were finalizing, minus EUR 1.8 million in legal and recovery costs. Then on the green bar, EUR 5 million Q-on-Q, mainly due to the workout seasonality. So that's NPL recovery that's obviously connected to revenues. And finally, cost of personnel, up EUR 2 million Q-on-Q due to the growth in Group employees and to variable compensation. But overall, compared to the fourth quarter of 2023, we are seeing the total cost nicely down by EUR 5 million. Page 13. Risk. Coverage increase, you can see that the total coverage ratio on the right is up to 48% now. Especially, I draw your attention to the UTP segment, 45%. That's also in terms of benchmarking, we believe, a very solid number. The loan loss provisions in Q4 were EUR 9 million. And if you go to the bottom part of the slide, the ratios, you can see that the gross NPE ratio is now 5.4%. If we exclude the loans to the Italian public health system of 0.4%, the gross NPE ratio is 5%. The net NPE ratio 2.9%, excluding those loans, 2.5%. That is a runoff portfolio vis-a-vis the Italian Public Health System, as you know. We've been digesting that over the last quarters. considering that we are an SME-focused bank without, for instance, a retail mortgage book, right, that would reduce the NPE ratio, we think this is an outstanding result to close the 3-year plan with 2.5% or 2.9%, depending how you want to see it, percentage points of net NPE ratio in the SME segment, we think, reflects correctly the prudence of Banca IFIS's approach to credit. On Page 14, an evergreen as you would call it. So we keep this slide in the presentation, although I won't comment on it in detail. You've heard it in the previous quarters. We try to share with the market the forward-looking indicators that might indicate right, a more widespread deterioration in the Italian risk scenario, and we have this quarter as well no indication that things are significantly deteriorating. You can see the payment days in Factoring rather flattish, actually being below what they were in 2022. The rating migration in the credit book is very reassuring. In fact, we have more upgrades than downgrades. No strange developments in the Stage 2 loans and the probability of default is flattish. So once again, a fairly benign, I would say, scenario in the performing book. Page 15, capital ratios. So core Tier 1 in September when we [ lost strength ] was 16.43%, it's down to 16.1% mostly due to very welcome risk-weighted asset increase because we developed some business. So obviously, the size of the book increased. So the denominator increased a bit. You can see the risk-weighted assets growing by about EUR 140 million to EUR 9.836 billion on the bottom of the slide. And therefore, a very nice 16.1% core Tier 1 ratio, which as you will recall from a few slides back, represents 100 basis points excess compared to what the plan was. Page 16, the last slide I will comment before handing over to questions, our expectations for next year. We think we're ready to face Italy's macro environment for 2025. We expect a moderate loan demand as corporates still have quite a comfortable long-term funding position, and we don't see the economy accelerating significantly. And we react to that by being focused on profitability, maintaining the average spread and growing our loans plus 2% year-on-year, where the market reduced them by 1% year-on-year. Then you might expect an interest rate reduction by the ECB as broadly assumed. Starting from the first quarter in 2024, we have significantly decreased our sensitivity to that scenario. In the event of some signs of asset quality deterioration that might happen in specific sectors, we actually also saw that. You may recall, we commented on it in Q3. We have allocated some overlays to specific exposures, and we remind everybody that our asset quality risk is significantly mitigated by diversification across sectors by our small ticket focus by the presence of short-term lending and by a very robust collateral management approach, both in Factoring, which -- where we might consider the invoices as collateral, but also especially in Leasing and in lending. Finally, the market dynamics in the NPL business, it's a well-known fact that there is more competition, slightly less loans are being offered, right? So following our acquisition of Revalea, I already mentioned it, we had reduced our purchases because we were focusing on the integration. We have now restarted acquiring stock, and we are close to activating the structures that we will use to address the impact of calendar provisioning. So overall, on this basis, a challenging environment for the next years, slightly more challenging, but where we can expect broadly a net income performance in line with 2024 results, assuming, this is disclaimer we always need to make, no significant deterioration in the macro scenario and in the geopolitical environment. I would, at this point, hand over to your questions, as we always do. I'm happy to take them, and thank you for your attention thus far.

[Operator Instructions] First question is from Irene Rossetto, KBW.

I have a few questions. The first one is in 2024, H1 came in very strong, and the second half was slightly weaker. Can you describe the main trend underlying the results? And shall we expect 2025 to be more like H1 or H2 results? Then in the last conference call, you guided us on a combined net income of around EUR 250 million in 2027? This is the sum of 2024 net income of IFIS and Illimity as synergies. Does this mean that you don't expect further growth? And finally, do you see any sign of a macroeconomic slowdown?

Thank you, Irene. Very clear. Yes, first half 2024 versus second half, there were, I think, 2 effects. The first was the rate scenario developing as it did. The second one was a little bit of increase in risk. And the third one is what you would expect, the classical Q3 seasonality, right? That's always been quite pronounced in Banca IFIS also in previous years, both the Factoring and the NPL business have a summer seasonality, which is quite marked. So as we mentioned on the slide where we gave a bit of an outlook for 2025 that you asked for, there are some effects that will certainly be present in 2025. But on the other hand, you've seen that we've also put in place some reaction with respect to those -- and some management action that we think is effective with respect to those phenomena. So for 2025, can you expect the first half or the second half, you think you should expect the mix, right, on average logical because 2025 will have a seasonality like 2024 will have it, with some headwind, but with our capability to compensate it in the ways that we discussed. And therefore, we gave a guidance broadly in line, considering it's February, right? So we're really at the start of the year, but broadly in line with 2024 in terms of net profit assuming the disclaimer, right, no macro shocks and no geopolitical shocks. We should always underline that. Then the second question was around the combined net income of the 2 companies. Well, it's obvious that we made an offer on the basis of an outside-in assessment. There can't be a detailed due diligence when you do a public tender. So we developed an expectation for our profitability -- of the profitability of the target and the synergies for 2027. So on that basis, we have no elements today that would change that. What you must factor into those numbers is a combination of macro effects, synergies and management action. So we really don't have a lot to add to that today. And obviously, we will monitor how the things develop in the next months. Remind me, please, your third question? The slowdown in the economy...

Yes, macroeconomic slowdown.

Yes. As we mentioned on the last page where we gave some guidance, we don't see a macro risk deterioration today. But we don't see a very strong economic growth either, right? So we expect loan growth to be subdued in the country, and we expect modest GDP growth. And on that basis, we factored in those expectations on the guidance that we gave. So more or less a continuation of what we saw in 2024, keeping in mind that the rate scenario obviously will develop, right? So that's something that's ongoing and that we expect to continue as rates decrease. I hope I answered your questions, Irene.

The next question is from Manuela Meroni, Intesa Sanpaolo.

Actually, I have 4 question on your offer on Illimity. The first question is on the timing. So why did you select this timeframe? Why do you decide to launch this offer right now? The second question is on the exchange ratio. Could you please explain how your exchange ratio will adjust for dividend paid by Illimity and IFIS. Third question is on the acceptance rate. What will you do if the acceptance rate fell below 66%. This is also considering the quite fragmented structure of the shareholding base of Illimity? And last question, what reaction do you expect from Illimity?

Okay. Thank you, Manuela. So well, on timing, it's very simple. We were at the end of our 3-year plan. We were in a good place. We had a significant capital buffer and an opportunity became available. So that's what led to the timing. There's really not a lot to add. It worked very nicely given our own project agenda and given our own 3-year plan, which was close to be completed. And once again, given the capital buffer that we maintain throughout this plan. There's really not a lot to add in terms of timing. In terms of exchange ratio, Yes, we placed a -- which we believe is a market-friendly provision inside the offer, meaning that the exchange ratio will be corrected for dividends, meaning that if one of the 2 banks in a totally symmetric way, right, pays dividends, the exchange ratio will be adjusted. So it's really quite a simple formula for an Illimity share, right? You would have 0.1 IFIS shares plus EUR 1.414 was the offer as it was made, plus 0.1x the dividend paid by Banca IFIS minus 1x dividend paid by Illimity. So it's just a correction in a totally symmetric way of the dividends that will be paid out in the next months. The acceptance rate, well, we are confident that the Illimity shareholders will see the logic of this transaction, will see the potential also of the combined entity given the share component of the transaction. And at this point, we really don't have a lot to say beyond reminding everybody that the synergies obviously require a good degree of integration, but I would not comment anymore. So nothing to add to what we said when we communicated the offer. What reaction do we expect? I already, I think, replied, we think that the offer has a sound industrial logic. We think that the synergies are absolutely reasonable given the fact that the businesses are similar and complementary. There was a slide in the presentation we made that show exactly this concept, right, where you see that in the SME focus, we have slightly different flavors, if you will, and in the NPL business as well. So we have good synergies in a nice complementary business. There is a lot of valuable skills in Illimity. So we think that the industrial logic of this offer is sound, and we believe that rationally Illimity shareholders will appreciate this. So nothing to add on the reactions that we expect except that we have stated our industrial logic. I hope I answered, Manuela?

Next question is from Simonetta Chiriotti, Mediobanca.

A couple of questions on the NPL activity, and in particular, on the restart of the purchasing activity. So if you can elaborate a bit more on what is happening on the market and on the activity that you are doing? And also on the activation of the structures that are needed to face the calendar provisioning, again, you mentioned that you are close to the activation of the structures, if it is possible to elaborate a bit on this. And finally, in Slide 20, in the Factoring segment, there is a release in the loan loss provisions of EUR 5 million. I was wondering what -- why this, so in general, on the loan loss provisions in the last quarter. And finally, on the cost of funding for 2025, if you can share the expected average cost of funding this year?

Yes. So I will take the last question first because it's the easier one. So in Q4, we had an aggregate cost of funding of 3.8% that was down from Q3 in -- that was 3.9%. So you can see the cost of funding decreasing, right? It's going down. We'd like it to go down more quickly, obviously. And we are doing what we can to make sure that the -- it decreases as fast as possible. There's a little bit of stickiness in there, right? So in terms of what we expect for 2025 is we have a target to remain below 3.3% average over the year, okay? I guess that is about as specific as we can be. Back to your question. The first 3 questions, you asked about restarting the activity on the NPL business, what's going on there. Well, it's very simple. We made a transaction with the purchase of EUR 6.8 billion gross book value, it was from Mediobanca. A very significant portfolio, which also requires some integration of the companies because we bought a legal entity, including colleagues that came with it. And so it was quite, first of all, a capital commitment. And secondly, operationally, it was really quite a big onboarding effort, right? In that context, we gave a bit less priority to being present in every auction, to be present at every possible opportunity to acquire NPLs to become a bit selective, if you will. We did some transactions, but smaller ones. So there was never any strategic decision to stop. It was just realistically saying, okay, I completed the acquisition target for NPLs for the plan, let's make sure we do this well before we add further acquisitions. Now obviously, the integration is now behind us. It went rather smoothly. So in Q4, we went back into the market, and we have participated in a series of auctions, both secondary and primary, both banking staff and consumer credit stock and we've been successful in those auctions. So we're very happy to start again, and we're back to normal, if you will. Activation of structure. When we're ready, we will share it with the market, we're just mentioning it so that people don't think we forgot. I wouldn't overemphasize the importance. Given our current capital position, we can quite easily as we are doing, also buy some loans that have calendar provisioning in them and absorb in 2 or 3 years' time when it will come a little bit off capital costs of that. So it's not an on-off switch, it's just something that is going to contribute, I estimate within 2025 to having an efficient NPL business, but in the meantime, we are active on the market. And we are currently buying loans, including also some loans with calendar provisioning, and we will manage that appropriately over time. Then you had a question on loan loss provisions in Factoring, that I'm not sure I really understood but Martino here took it on board. So I'm going to take this question, and direct it for a second unless you want to maybe clarify what you meant, then maybe we can answer. But I'm really not quite sure what you asked us.

Yes. Just looking at Slide 20, the loan loss provisions in Factoring in the last quarter, which are positive.

Okay. We'll take that. We think it's probably an effect where within the segment, there was an adjustment. So one segment having a minus, one segment having a plus. We're going to take a few minutes to work that out and maybe take this offline with you Simonetta and Roberto Ferrari is going to give you a more specific answer than I can give right now.

Next question is from Davide Giuliano, Equita.

I have just 2 today. The first one on Factoring spreads on the base rate. They fell on a sequential basis to 3.5% in the quarter. I imagine this was done to sustain business generation. I was wondering whether you are seeing a shift towards medium to long-term forms of financing given lower rates. And maybe you can provide some color on demand dynamics overall as well? And do you expect spreads to partially recover next year? Or will you continue favoring volumes? And the second one on trading, how replicable is the performance on trading next year? How much do you expect next year from dividends, exit from co-investments with private equity and other more predictable, let's say, sources of revenues.

Yes. Thank you for your question. So yes, on Factoring, we have 3.5% that spread on top of the base rate, and there's also a commission component. What we expect, we expect, obviously, the base rate to decrease further. We don't think we will significantly increase spreads, though if we have the opportunity, we will do it. Sometimes when the base rate decreases, you can create a bit of space with the client to increase the spread a little bit as the overall cost for the client will come down. What we, on the back of that, expect to shift towards medium- to long-term lending, not really, the core of this bank and its core skill has always been in Factoring. We love Factoring as a business. It is a very good risk return profile, and it keeps the balance sheet short. If we wanted to give a lot of medium- to long-term lending in the last years, especially with government guarantees, it would have been possible to do it. It was a conscious choice not to go there. We like the product. We have about EUR 1 billion of medium- to long-term lending to small businesses and SMEs with -- mostly with government guarantees. We do medium to long-term lending, but we stayed away from a mix of products that will need the balance sheet to become so rigid, so long and also so much exposed to the deterioration of the macro environment without being able to react. So we think the relatively short balance sheet of Banca IFIS, especially in the Leasing -- also in the Leasing segment, not only in the Factoring segment is one of our strengths. And so no, I wouldn't expect a shift towards medium- to long-term lending. In terms of market dynamics, we expect the next couple of years to be actually quite nice for Factoring because we come out of a situation where the market was, how should I say, inundated with cheap long-term lending. And that is typically difficult if you're selling short-term lending, right, difficult to keep your volumes up, right? So we come out of a very challenging couple of years where the corporate had access to long-term lending at very cheap rates that were offered by many banks, and they used it to finance not just investments, but generally cover their financing needs. This will be absorbed in the next couple of years. And you can see the overall loan stock in the country declining. So we think that we will go back to a more normal situation, and that will be, we think, beneficial to our Factoring business. With respect to your question about the sustainability of the trading and the equity business, I give the floor to Roberto Ferrari, who will take your questions.

Thank you, Davide. Good afternoon. Yes, actually, on trading, we marginally increased our risk return profile. We reckon we can perform a similar return in 2025 compared to 2024, also thanks to the increase in duration that we built. At the same time, we also consider current our private equity return. So we do expect and we have a budget where our return on private equity investment is similar to 2024. And the dividend in our budget will be a bit higher than 2024, I would say, in a range of 20%, 25% higher than last year. Thank you for asking, Davide.

So I take the opportunity to come back to Simonetta's question, Martino will take your questions on the loan loss provisions.

Okay. Good morning, Simonetta. So the numbers you see is just a sum of 2 different items on -- partially is due to the allocation of overlays. As we mentioned in the previous 2 quarters, we are allocating overlays against specific risks. The, let's say, other part of that figure is explained by the recalibration, the annual recalibration of the models, the risk model between Stage 1 and Stage 2. Thank you very much.

Davide, are we okay?

Fine, thank you.

The next question is from Luigi Tramontana of Banca Akros.

One question left regarding your delays. How much of the lease do you still have available? Where have you allocated them, I mean, in which sectors, where do you see most pressure on the asset quality? And when do you think to use the remaining ones all this year or spread over time?

Yes. So on overlays, we gave the following information in the last quarter, and we're not -- we don't have anything additional to say. So we've started allocating them, that is using them, in the middle of 2024 as was expected. You will remember that we had them against concentration risks, against certain sector risks, mostly. And so we've started consuming them and we believe that they will be more or less fully absorbed, except maybe for some floor that we will retain by the end of 2025, okay, maybe early 2026. We have not given a detailed update on the single overlays line items to the market as we actually think it's more material for a credit committee than for an earnings call. It's very detailed information. And we won't give a quarterly update on exactly, right, where did it go? How much was released, how much was taken back? How much was moved maybe to another segment or sector? Where they were used in terms of sector? We had, I think, 2 macro areas, one being steel and especially the SMEs that work with the Italian steel sector and especially one as you can imagine, very significant steel company in the South of Italy. And the second one is automotive, where we've had quite a slowdown in demand and production from the various automotive players, leading to some stress especially in their supply chain and the smaller companies of the supply chain. So no issues with the large automotive players at all, but some issues in the supply chain. And those were the 2 areas where some overlays went to. The second question is, I didn't fully get, Luigi. Can you repeat it, please?

No, you responded to all my questions.

[Operator Instructions] Mr. Geertman, there are no more questions registered at this time.

Thank you very much, Madam. And thank you, everybody, for your time and attention this afternoon, and we will be talking to the market in the next couple of months, I'm sure, as the quarters of 2025 start, and as the offer matures. For now, thank you very much.

Ladies, and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones.