Bendigo and Adelaide Bank Limited (BEN.AX) Earnings Call Transcript & Summary

Thanks so much for joining us and welcome, everyone, who's on the conference call, and thanks so much for those who came in person. We really appreciate it. Let me begin today by acknowledging the traditional owners of the lands in which we meet here in Sydney, the Gadigal people of the Eora Nation. I pay my respects to their elders past and present and pay my respects and extend my respects to the Aboriginal and Torres Strait Islander people here today and on the call. So today, we have Richard Fennell, our CEO, who will provide an overview of our strategy thus far and our momentum that we're building. We also have Andrew Morgan. He will look at our business momentum with our normal 3 focus areas of optimized deposits, sustainable growth, productivity, both in the long term and the short term. Richard will include in his section an update on the announced RACQ transaction. We'll then head into Q&A, where Richard will also give a quick overview of our AML announcement last Tuesday. In the Q&A section, we have members of our executive who are here to help with Andrew and Richard and answer questions. Just a few logistics. Our bathrooms are outside to the right. If there is a fire alarm, please follow the instructions from the concierge. I'll hand over to Richard.

Thanks, Sam, and good morning, everyone, and welcome to those joining on the conference call as well. I'd like to begin by addressing the announcement we made last Tuesday. I recognize that as an organization that works hard to deliver on its purpose, we've fallen short of the standards we set for ourselves and that our stakeholders expect. The Board and senior management are fully committed to prioritizing a comprehensive uplift of the program of work required to rectify the AML issues that we announced last week. I'm going to give an overview of where we're at just before the Q&A session. But what has become even more clear through this information over the last week or so is that our key enablers are critical components of our strategy. We had already started an AML uplift program, but we'll need to do more in order to future-proof our risk management. But at the same time, we will continue to pursue the initiatives necessary to deliver on our strategy. So this will require a parallel focus. Our recent progress is the direct result of being patient and deliberate in the foundational work that we've completed over the past 6 years. So what I'd like to do now is highlight some of the progress we've made, in particular, since our full year result announcement. By this time next week, we will have completed our core consolidation program of work, going from 8 core banking systems 6 years ago down to 1 as we finalize the transition from the Adelaide Bank core banking system to our Bendigo Bank platform over this weekend coming. In undertaking these system rationalization programs, we've developed repeatable customer migration capability. We've also deployed our new Bendigo in-app digital onboarding capability for customers, who can then use this to join in a far more efficient way and also able to be used by our frontline staff as a fast and safe method for customers to be onboarded to our bank. Our market-leading Bendigo lending platform is now in use at our over 400 branches right across the country in addition to being used by our broker partners and our white label partners. And our recently announced 5-year partnership with Google is going to ensure that our people and customers have access to the benefits of the latest AI capabilities digital skills and importantly, cybersecurity defenses. And in September, our digital bank, Up, launched a new deposit product structure called GrowFlow and this has resulted in significantly stronger inflows of deposits to Up. And last but certainly not least, our balance sheet remains in a very strong position. Our capital position is well above our Board minimum. And as at 30 September, we have $360 million in excess capital ex-dividend. Our customer deposit funding ratio is 77%, and our loan loss rates remain at historically low levels. So these strengths will continue to allow us to take advantage of strategic opportunities as they arise, build our growth momentum as we, in parallel, address our required AML uplift program. I'll now take you through some specific details relating to the key sources of our strategic momentum, including Up, why customers are continuing to choose Bendigo Bank and how the Up and Bendigo teams have worked together to build new capabilities for the Bendigo offering. So let me start first with our long-term strategic investment in digital innovation, Up. I'm delighted today to confirm that our approach to support Up's independent development and operation is continuing to deliver strong results. And specifically on the back of the Grow Flow initiative, Up achieved its first month of profitability in October, more than 6 months earlier than we had expected. Now over the next few months, Up may move in and out of profitability. But as we continue to see its balance sheet grow strongly, the trajectory is firmly towards consistent positive contribution. Over the past 7 years, we have built Australia's leading digital bank. It now serves well over 1.2 million customers, holds 6.5% market share in the 18- to 24-year-old demographic and continues to deliver strong year-on-year deposit and lending growth. Just in the last couple of days, it ticked over $2 billion in residential loans on its book. So the trajectory for this business is strong and innovation with agile execution remains at the core of how Up goes about its business. Currently, the team are investigating broadening the lending products to include an investor residential loan product to capture a broader range of borrowers in the digital market. Up reaching profitability is an important milestone, and it is tangible proof of our ability to make life easier for our customers with digital capabilities. I now want to talk about the power of the Bendigo brand and its role in supporting our strategy, which has been a frequent point of discussion, since our full year results announcement and how those insights have influenced our work on the Bendigo app. Research shows that when choosing a bank, approximately 70% of customers are driven by rational factors, customer experience like ease of use and channel choice. The remaining 30% of customers are driven more by emotional factors, reliability, authenticity, trust, fairness. At Bendigo, we score significantly higher on those emotional drivers in comparison to the major banks and also the mid-tier banks, and that's our core strength. This demonstrates that we forge a connection with our customers in a way that others often struggle to achieve. But we are also focused on improving our performance on those rational drivers through improved customer experience. Fast digital sign-up, improved digital account management and speed of our lending platform are all tangible examples of the improvements we're making. So when we are asked why do customers bank with us, we know that the customers choose and stay with Bendigo Bank because they have a strong emotional connection with our brand. But our strength isn't just confined to emotional drivers. It's also reflected across other crucial performance metrics like our rep track scores, our overall brand consideration, our status as a trusted brand and our NPS versus market. And we know that it's important that we can correlate that high NPS to deposit gathering strength. And Andrew is going to talk a little bit more about that later. If we take our strong customer connections, NPS and focus on growing lower-cost deposits, we know the Bendigo app plays a vital role in helping us to achieve that. And the app had fallen behind on a number of capabilities, which support those rational drivers. So we use that research to directly inform the app's features and our focus with a clear goal of closing that gap when it comes to customer experience. In addition, we knew with our old online account opening capability, 3 out of 4 customers were dropping out before they'd get through that process. And we've also seen through our experience with the EasySaver product that when we've given our existing customers access to easy-to-use digital capabilities, they will take them up. So Xavier Shay, our Chief Digital Officer; and our new Chief Technology Officer, Kieran O'Meara, they brought their teams together to focus on this challenge. And in doing so, they've been able to rebuild the in-app onboarding capability for Bendigo Bank in just 3 months. And this is a clear demonstration of how our investment in Ferocia, the team behind Up, is now bringing their execution capability and agility into the Bendigo business. And early results are really encouraging. Since the launch of the refreshed app at the start of last month, we've attracted over 1,500 new-to-bank customers, most joining outside normal business hours. And the app is now scoring a rating of 4.8 in the App Store. The early indicators are positive that this channel will be a key driver for growing lower-cost deposits once we ramp up marketing and promotion activity. Turning now to our announcement today of the RACQ Bank acquisition. This transaction represents a compelling opportunity for us to enhance shareholder value. The transaction will result in Ben acquiring approximately $2.7 billion in primarily residential mortgages and $2.5 billion in retail deposits as measured at June 2025. And based on these June figures, we estimate that this book of business will generate approximately $50 million to $55 million in net interest income. We're going to commence integration activities early in the new calendar year, and we estimate post-tax integration costs of $25 million to $30 million. We're targeting completion to be in the first half of financial year 2027 and will be funded by existing capital reserves. The acquisition is highly aligned with our strategic objectives. RACQ Bank, like Bendigo Bank, boasts a strong and loyal customer base and a low-risk lending book. It's going to increase our proportion of lower-cost deposits at a group level by around 20 basis points. And we'll leverage Bendigo's existing infrastructure and capabilities on an ongoing basis. We'll migrate customers directly onto our core banking platform, allowing us to support these customers simply and efficiently, and those customers will be able to use our 75 Queensland branches and the ongoing run costs are going to be modest. The acquisition also provides geographic diversity, expanding our presence in Queensland to around 18% of our consumer lending book. And the mortgage portfolio is sound with a low loan-to-value ratio of 58% and owner-occupied loans representing 79% of the book. Credit quality is excellent with minimal historic arrears. Importantly, the financial benefits are going to be significant. Based again on those 30 June 2025 pro forma financials, we're estimating a 35 to 40 basis point uplift in ROE and about $0.04 to $0.05 of increased earnings per share. This path will support our -- sorry, this acquisition will support our path to enhance shareholder returns through both improved profitability and strategically aligned growth. And today, as we announced this acquisition, we are a much simpler bank, 2 customer-facing brands, leading digital capability and one core system. As this slide illustrates, our ability to migrate the 90,000 customers onto one core system and the Bendigo brand will translate into shareholder value creation. I'll now hand over to Andrew to talk through the momentum in the business.

Thanks very much, Richard, and good morning, everyone, and great to see so many people in the room joining us today. Today, I'm going to cover a few things. So first, I'll talk about business momentum and provide a little bit more color following our first quarter trading update, which was released on the 11th of November. And I'll talk about momentum with reference to our 3 near-term focus areas. Then I'll talk about productivity and how we continue to think about managing our business as usual costs in line with our guidance of no higher than inflation through the cycle. So starting with our deposit franchise and picking up a thread from where Richard was going. You've heard us talk now about the power of rational and emotional drivers in customers' choice of banking. And you've seen that on emotional drivers, we score very strongly relative to the major banks and Tier 2 banks. And through the work that we're doing in digital, we're aiming to close the gap in rational drivers. We believe that our customer-focused model drives that emotional connection and in turn, drives high customer satisfaction and strong Net Promoter Scores in both our Bendigo and Up brands. In our view, this advantage that we have is very difficult for others to replicate. So how does that translate to value? Very simply, there is a strong correlation between Net Promoter Score and the ratio of deposits to loans. We would argue that it's part of the reason why we can gather lower cost deposits at the pace and the price point that we do. Continuing on the theme of deposits and now into business momentum. As you know, building our muscle in digital deposit gathering is key to strengthening our already strong deposit franchise, where today, almost 2/3 of our deposits come from our physical network. As Richard mentioned earlier, about a month ago, we rolled out our refreshed Bendigo app, which now allows customers to join the bank digitally in as little as 5 minutes. Early signs are positive with more than 50 new transaction accounts being opened every day. We're also seeing 1 in 4 customers take a savings account. And some of these new-to-bank customers have also taken out other products, including mortgages. Our growth in savings accounts continues to be strong, underpinned by a combination of Easy Saver through the Bendigo brand and Up savings accounts. Year-to-date, Easy Saver is growing at over 13% annualized, whilst growth in Up Savings is very strong, up 35% year-on-year. With slower lending growth this year, we've been actively managing deposit and funding mix, and this has seen the mix of lower cost to total deposits improve. Moving on to sustainable growth. You've previously heard us talk about the work we've done in the last few years to understand the marginal profitability of our various lending channels and using that as a basis to allocate our capital. For residential lending, in particular, what we do is look for growth opportunities, which also deliver the best combination of margin and return on equity. That means that when our net interest margin and return on equity expectations are not being met, we will reallocate capital using price as our predominant lever. Through the course of this half, we've stayed patient in residential lending markets, being very selective about pricing decisions and trusting that we would see flow into our physical channels once the new lending platform came online. That patience is now being rewarded. For the month of November, applications per day, which are our key lead indicator are the highest that they've been all year and critically important, still within our funding appetite. We expect the book to start growing again in the second half and to be back at or near system annualized during the fourth quarter. This patient approach also means that our margin has been stable through the course of this year. Moving to productivity and cost management. As you'll recall, we announced around 100 redundancies at our full year results. As of November, most but not all of those roles had come out of our FTE numbers and our cost base. In addition to that, we've completed further restructuring and other teams. And as of the end of November, our FTE are down 3.6% year-to-date, which is the lowest level that they've been, since January 2022. What that means is that you will see lower headcount transmit into our cost base, partly in the second quarter and fully in the third quarter. We've seen that play out in our October numbers and our November numbers, which are tracking lower than first quarter average daily costs. We think that puts us on track for a second quarter expense result that is lower than first quarter. In addition, we've been actively reducing contractor numbers down over 30% since the start of the year. This mostly benefits our investment spend and gives us confidence on our full year investment spend guidance. Moving on to productivity longer term. We've previously said that our longer-term business as usual expense guidance is to grow our costs no higher than inflation through the cycle. That guidance remains. What I want to do now is give you a little bit more color on how we think about this long-term cost path. We know today that of our 9 cost pools in our organization, 2 of those will grow faster than inflation, and that is software license and cloud costs and also amortization. Neither of those 2 will be a surprise to you. 3 of our cost pools, we expect to grow around inflation, and that includes, for example, our customer-facing teams. That leaves 4 cost pools where we're actively working to manage the growth in those cost pools to a rate below inflation. Overall, we believe that the benefit will allow us to maintain business as usual cost growth to no higher than inflation through the cycle. So how will we get after those 4 cost pools that I've just described? There are 4 key actions. The first is operational excellence. We established a program in 2022 and now have over 30 practitioners in our central team. That team has been very focused on our operations and contact center teams and has yielded around a 35% reduction in that resource base over the last 3 years. We've also trained around 100 senior leaders in process excellence disciplines. The second is capability building through strategic partnerships. We've previously spoken about our current 60-plus partners that we use today in technology. These partners perform both run and change activity for us. We're actively working through streamlining the number of partners which we use in future, and that number will likely be in the low single digits. We believe that this gives us both access to enhanced capabilities and a much more efficient cost signature in both technology run and change costs. We're also exploring partnerships around some of our other business processes. Again, we see a lot of opportunity to access both new and improved capabilities and cost efficiency in running those processes. And we'll have more to say on this through the course of the next half. The third bucket is AI and automation. And as we said earlier, we recently signed a 5-year deal with Google that will provide enhanced capability around cloud and access to enterprise-wide AI tools. We currently use AI in a number of areas of the bank, and we'll now look to accelerate use cases in other parts of our business. The fourth is refining external spend, including the cost of our corporate property footprint. Our work in this area in the last few years has been substantial and will continue. As one example, in the last 3 years, we've reduced our corporate property footprint and rent expense by 30%, and we can see a path to a further 15% rent reduction in the next 3 years. On all of these items, we'll have more to say through the course of the next half as our plans continue to harden up. I'll now hand back to Richard.

Thanks, Andrew. I'd like now just to turn briefly to the announcement that we made last Tuesday and to provide a bit of context on that where I can. We identified suspicious activity in one of our branches and self-reported that to AUSTRAC and law enforcement authorities. We then commissioned Deloitte to undertake an independent review of the root cause of those issues. That review, and we received the final report early last week, highlighted deficiencies in our approach to anti-money laundering processes and controls, and we've accepted those findings in full. We've now reengaged Deloitte to help scope the activities to help us to address the identified deficiencies. This work will then be aligned with the existing AML uplift program that was noted in our annual report. The Board and executive of the bank are fully committed to funding this necessary program. And while the specific costs and time lines are not yet finalized, I can assure you this work is critically important to us. But I also understand this results in a level of uncertainty. I can assure you that we are moving with urgency and rigor to develop a comprehensive remediation program. We're committed to achieving full compliance, and we'll update the market as soon as we have a finalized and actionable plan, including cost estimates. But at the same time, we must also continue to deliver on our 2030 strategy. Execution of our strategic initiatives will continue, and we'll make appropriate trade-offs to ensure we can balance both our AML uplift program and our strategic priorities within our funding plans. So we'll now open it up for Q&A, and we'll be joined by Sarah, Kieran, Adam and Xavier as well to answer your questions. Sam, I'll hand over to you.

Thank you, Andrew. I look at the 2 in the front. All right. Jon Mott. Nathan is going to bring the microphone down.

Jon Mott from Barrenjoey. Just a question, a small acquisition, but a bolt-on acquisition today. Can you give us a bit more information? How much did you pay for it would be kind of useful. I hadn't seen those numbers. Was it above book value? Is there goodwill? And also just -- I'll be brutally honest, a lot of the small banks and nonbanks around Australia are really struggling financially. And you heard in Matt [ comment ] talk that there's only 2 banks in Australia covering the cost of capital. With the technology, cyber, AML, risk, compliance costs, they're under a lot of financial stress. Are there additional businesses that you'll be looking to acquire, either they're coming to you or you're going to them as additional bolt-on acquisitions that can grow the bank and provide scale over the coming years?

Yes. Jon, this is -- this acquisition is at book value. So there's no premium. And that was an important part of the consideration about whether to undertake this transaction. We've -- as you know, we've had a lot of experience with goodwill on our balance sheet. We're happy not to have any more. And -- but as well as the compelling financials of this transaction, we think strategically, it's a good fit for us as well. We're delighted to have some stronger presence in Queensland, one of the fastest-growing markets in the country and provides a good balance to the natural strength we've got in the Southern states. As far as -- and look, I saw Matt's comments as well, and it is a challenging industry. We're not out there actively knocking on doors looking for more acquisitions. The reality is this was a conversation that started from the RACQ side of things. And if other opportunities come up, where we think there is a good fit strategically and economically, it's a really good outcome for our shareholders, then we'll consider it. But it's not something we're looking to race around mopping up a lot of these smaller banks. We'll assess them if and when they may come and have a chat to us. But it's not a -- I mean, as we were talking about, I think, last time, our focus is primarily on organic growth.

And what customer losses you are receiving?

We've made -- look, we're not going to announce the actual assumptions we've made, but we've made some attrition assumptions in there. But importantly, there is an ongoing referral agreement in place, Jon. We're bringing across -- or we'll be making offers to their lending staff to bring them across as well. So we're hoping we'll be able to keep those attrition levels to natural levels of attrition. And hopefully, with that ongoing referral agreement, which covers both lending and deposits with -- I think it's 1.7 million members, I think, RACQ has in Queensland, we would hope we'll be able to continue to attract a proportion of those to our bank.

Move to Andy.

Thank you. Andrew Lyons from Jefferies. Andrew, you speak to sub-inflation BAU expense growth over the cycle. Do you realistically think that you can do that in FY '26? You've done 7% expense growth in the first quarter on PCP. Now you have said today that you think you'll get second quarter costs down on the first quarter. But it would appear to get to 3% full year expense growth, you're going to have to reduce cost by 6% to 7% for the remainder of the year versus that first quarter. Like is that realistic to sort of continue to maintain that sub-inflation cost growth in FY '26?

Just to clarify one thing, Andrew, no higher than inflation, not sub-inflation. So the trajectory is very strong, and our FTE is down 3.6% year-to-date. We've got other pieces of work in place at the moment. At this stage, we're still targeting to be around inflation, maybe a little bit higher than inflation. I note as well that inflation is continuing to tick up. There are fewer days. Surely, you expected that. But look, people costs are 60% of our costs. And as I said earlier, our FTEs are as low as they've been in -- since January 2022. And with new leaders, some of whom are sitting to my right here, the work that's being done to restructure to bring capability into the organization to get cost out is as strong as I've seen. So the indicators there are good. Now there are always going to be exogenous factors that might impact. But as we sit here today, the largest driver of our cost base, which is people costs, and that 60% of our cost is down -- is pretty well down year-to-date. And certainly, in the first couple of months of the second quarter, the trajectory is good.

So we'll go to Richard Wiles.

Richard Wiles, Morgan Stanley. Your capital level at the result was about 11%. Dividend takes off 40 bps. This acquisition takes off another 35%. So we're down to 10.25% and the target is above 10%. You're hoping to improve your loan growth, and I assume you're hoping to hold your dividend. So what makes you think you've got enough capital to do this acquisition, improve growth and keep the dividend where it is?

Yes. So our CET1 was 10.93% in September. That was [ active ], and it's climbed back up to about 11%. So if you do the math on the Board versus the Board target, we're sitting on around about $400 million of capital before we move into this transaction. There's 2 parts to the capital impact of the transaction. 1 is transition costs that we'll incur between now and when the transaction completes, and then we'll step into the risk-weighted assets. That's first half '27 likely impact. Because of the very low marginal costs associated with the transaction, it generates organic capital immediately. So it's -- if you kind of back solve the costs that we've assumed, it's about a 25% cost-to-income ratio. So it's a very low cost to actually run the book. So as we sit here today, Richard, yes, we're comfortable with our capital levels.

And if you've taken into account the potential cost of the uplift program and the potential for your regulators to impose some sort of capital overlay?

Yes. I mean we don't know a bunch of things today, as you would expect. But as you would also expect, we regularly run capital testing and the like. And so as we sit here today, we're comfortable.

And can I ask separately, you've made some comments about your expectations for volume growth in the second half. And Andrew, as you've said before, you're very focused on margin management. Do you think you can grow revenue in 2026?

We'd like to. So the key, as we previously said, is it's a deposit-led approach to lending, and those deposits should be largely through lower cost deposits. Because of slow lending growth this year, we've been able to, for example, manage down more expensive forms of funding like wholesale funding, like term deposits. Some of that might need to lift a little bit as we start to see growth pick up, in particular in the fourth quarter. But as we sit here today, our margin is in pretty good shape, and we'd like to see that balance growth translates into income growth.

Thanks Richard. We now move to Matt Dunger.

Matt Dunger from Bank of America. I wondered if I could ask about the anti-money laundering issues. I know it's too early for you to quantify today, but I'm sure you've looked at Bank of Queensland, who took a $60 million provision back in 2023. Just wondering if you could talk to what sort of allowance you had already made for anti-money laundering and how you would compare Bank of Queensland's uplift program to yours, your own?

Yes. Thanks, Matt. So look, we'd already set aside a number nowhere near $60 million for the uplift program we're planning to undertake. It's a lot less than that. I must admit, I'm not across the scope of exactly the BOQ program of work. And the reality is we don't know yet that the piece of work that we've asked Deloitte to do will help to inform that. And any number I try and pick out of the air now, I know it is going to be wrong. So the reality is I can't give you guidance on that. And -- but once we do have a reasonable guide for that, we will share it with the market. We're not going to try and be perfectly precise on that. But as soon as we know a number based on a reasonable set of assumptions and analysis, then we'll share it.

And should we be thinking about sub-inflation cost growth as being excluding a provision for this program of work?

The reality is we don't know. I'd love to be able to sit here and say this program will work, we'll be able to manage within our future view of our slate and BAU costs. But I just don't know. Again, as soon as we do know, we'll share it with the market.

Thanks, Matt. Tom Strong.

Tom Strong from Citi. Just wanted to go back to Richard's question around revenue growth. I mean coming back to system in the mortgage book really is contingent on these lower-cost deposits coming through. So can you just provide some color around the assumptions you've made to get to that 45% digital deposit target by the end of June '26? And where do you think you can get that to in time?

Yes, I might get Dave shortly to comment on Up in particular. But I'll just give you a couple of data points. So Easy Saver, as you know, and we've talked about Easy Saver for a couple of years now is one of our strongest growing products. It's a lower-cost product. It's a very simple product that our customers love. So that's growing at 13% annualized. We've only just, in the last month, put the new join the bank capability in app and it's very early days, but we see that there's opportunity there. And Sarah might also -- I'm throwing to a few of my colleagues here. Sarah might also want to comment on some of the targeted marketing that we can do to then support the launch of that app. And this is my segue to [ Xavier ]. Up's growth continues to be very strong. And one of the things that Richard talked about earlier was the launch of Grow Flow. This is a different type of Saver product, which customers have responded very well to. And early days, very strong growth, and I can see a changed trajectory, since we launched that product. But [ Xavier ], do you want to talk about that?

Yes, 100%. And That, for me, was almost the missing piece for Up. We knew we weren't getting our share of customer deposits commensurate with the number of customers we had. We're now seeing that starting to come through. And so that's really positive. And I think also noting that our deposit growth in Up has been consistently outpacing our customer growth. So even outside of growth flow, this was still true. And so -- and that's for a few different reasons, where our customers are aging and the average deposits goes up. We're starting to attract some slightly older customers that sort of shifts the balance up. And people are just getting more comfortable with Up as well. So that's working out really well. On the 45% target, you mentioned that's I don't think -- so the assumptions that get us there are pretty much the things that we've just done. But there's no big other major things that I feel like we need to do in order to hit that. We just need to continue to push what we've done to get there. So I'm feeling pretty confident about that target at the moment.

Tom, one of the other things that's interesting with the new join the bank capability under Bendigo, as many of you are aware, we have -- on the Bendigo brand, we have a very strong demographic skew towards older Australians. The customer demographic that's coming through now is more clustered around the mid- to high 30s. And so that's kind of exciting for us to see. Yes, it's early days, but through that capability, we're attracting a customer group that we weren't succeeding in attracting previously largely because we're asking them to come into a branch to open an account. And not many people in the 30s really feel that they want to come into a branch if they want to open a deposit account.

Thanks, Tom. We'll go to Andrew Triggs.

It's Andrew Triggs from JPMorgan. Perhaps one for Richard. Just on the AML issue, can you maybe take us into why it took the reporting of suspicious activity in one branch to do a proper third-party review of your AML preparedness? I mean this has been a topic for regulators and for the market since at least 2018. It strikes me that there wasn't -- this review hadn't already been completed by the group.

Yes. Look, that's a fair question. I think in hindsight, and hindsight is a wonderful thing that we arguably should have done this earlier. We weren't aware of the deficiencies that were identified. We've been working very closely with the regulator, AUSTRAC over many years. We've been continuing to uplift our AML capabilities over the years. The reality was it took for the identification of a particular issue for us to go, hang on, let's go and do a root and branch independent root cause analysis here. We haven't seen to that point in time, evidence that there were deficiencies. And yes, look, a, that's probably all I can say on it. I'm not -- in hindsight, yes, it would have been nice to have identified these earlier before these issues arose, but the reality is we are where we are.

And for Andrew, just the 10% BAU cost growth in the first quarter, can you unpack that for us? I know some of it was redundancy remediation, but the bulk of it appeared not to be. And if 60% of your costs are fairly predictable being staff related. Could you sort of unpack that big number for us, please?

Yes. So there were some seasonal and some one-off factors, Andrew. So there was a higher days count than the second half average. There were some redundancy costs. There were some remediation costs. And we also do our pay review cycle in the first quarter. And that's -- as I think some of you reflected on in your notes when we published the trading update, this is the first time we've done a quarter 1 trading update. So I think you're all getting used to our seasonal idiosyncrasies, and that is one of them. So the main drivers were those seasonal factors and hence, the reason why -- part of the reason why we're seeing now an appropriate drop in the second quarter. Some were the genuine one-offs, so things like redundancies and remediation.

I'll go to Brendan, please.

Just a question on your longer-term productivity. You did note that you got 60% of your cost is staff related. You've got a cost-to-income sort of over 60%. Now that you're on a single platform and you're developing a lot of these digital interactions with customers, particularly in deposits, what's the latent opportunity for staff reductions here? Like you've taken out 3.5% now. But in the longer term, what would be the ideal sort of target? And where would they be coming from?

Look, we think there are significant productivity opportunities across a range of areas within the organization. Now will they result in direct reduction in FTE like we've seen over the last 3 or 4 months? Maybe in some cases. But if we can get back on to a growth trajectory, some of those resources will be required to support growth. I mean the acquisition we announced today, we've made some assumptions on some additional resources required to support those 90,000 customers. There will be changes, though, in our workforce over time. And that's the reality of all workforces at the moment as new capabilities, new technology and new demands occur. I mean one area that I expect we're not going to be seeing reduction in headcount and probably going the other way is financial crime, not just based on the announcement of last week. So it's hard to give an absolute number. But one thing I will say is we're working really hard to drive productivity in the areas, where that's possible. We're not going to be taking a foot off that pedal. There are other initiatives that are underway that have still got a way to go before completion. And once -- as Andrew, I think, mentioned in his update, in the second half, we'll be able to give you more insight into those. But we don't have a set number that we're targeting. We're looking to drive productivity as hard as we can right across the organization.

Just to build on, Richard, Brendan, FTEs is interesting. FTEs is important as a lead indicator. Ultimately, it comes to cost. And that's why we continue to talk about no higher than inflation, we think, is an appropriate target. And what I talked about in my slide, I can tell you one of those initiatives, particularly around partnering is a piece of work that we've done an extensive amount of work on already, and we'll be ready to talk about that in the second half. And that really underpins that comfort we have around continuing to reiterate that guidance of no higher than inflation. And again, it's really about understanding that there are certain parts of our cost base that will grow above inflation, and you guys know that. So license cloud costs, every bank, a lot of companies across the market are seeing exactly the same thing. Amortization, you know as well because of our higher CapEx. So we've got to do work to stay in front of those costs and then manage the overall to no higher than inflation.

It might be useful to hear from Kieran to some of his observations, particularly around the technology range of platforms we use, et cetera, and how you think about that, Kieran, because to your point, as we simplify and get to one core banking system, that's providing opportunities.

Yes, it's a good point. So I think there's a few dimensions we're looking at. The work is underway. The first one is referenced in the slides before around the partners landscape. So in excess of 60 partners in the organization today. And it's true to say there's nothing particularly unique about any of them. So there's a scale opportunity there to rationalize and that started. I think the second piece after that then is, to your point on one core is where do we take that one core next and what opportunity does that present? And the next immediate push for us will be into more decoupling of that so we can enable more of the front-end work that Xavier's team does that will accelerate the growth. But it will also accelerate the ability to rationalize the amount of technology we manage. And so being relatively fresh to the organization, one of the first observations is there's a lot of discrete technology, and there is an opportunity to rationalize the number of things that we look after, which is the next big push. And my team have started on a point of view for that in the second half that we'd look to execute from FY '27 onwards. And that in itself is fairly significant in addition to looking at FTE numbers and so on. I think third then is the -- for me is the mix of work and who does what work and where that happens and linked to the partnering strategy, we're exploring options there as well.

I got a second question on the AML. You talked about the process from here, getting Deloitte's to scope the changes that you need to make across the organization. How do the regulators get involved in this? Obviously, they would have concerns. Are they doing their own investigation? Or how does that integrate into what you're doing?

Yes. Look, we've kept the regulators fully informed on the process throughout. And from what I can see looking at the process that others have been through, and clearly, we're not the first to stumble into some issues in this area. We'd probably come out earlier. And we've done that out of an abundance of caution in making sure the market is as fully informed as we are around this issue. So we're liaising, as you can imagine, very heavily with the regulators around this issue. They have access to that same report that led to the announcement last week. So they received that last week. I expect they'll be reviewing that before forming their opinion on how they want to work with us to make sure that we get our AML/CTF program to the necessary level of sophistication and maturity.

Thanks, Brendan. I'll work my way down to Ed, please, Nathan, and then BJ.

It's Ed Henning from CLSA. I just wanted to clarify something today, you've talked about committing to your 2030 targets, which is great. But -- and while I understand you don't know the cost of the AML and what's going on, can you just clarify for us, are you thinking about now just ring-fencing that and continuing to work with the growth initiatives to get to your 2030 targets?

Yes. I'd love to be able to ring-fence it perfectly and just say that's going to be over there. But the reality is this is -- we expect this is going to be a pretty significant program that is going to need a fair bit of focus. So the way one probably think about more is running in parallel rather than ring-fencing it. And I don't know whether these are the right analogies to be using. But we will -- what is important, though, is we don't stop the business and say, right, let's all like moths to a flame, focus 100% of our attention over here. We need to absolutely commit the appropriate resources and attention to address the deficiencies that have been identified. But we need to make sure we continue as far as possible to drive the business forward towards that 2030 strategy. Again, hopefully, by the time we're out with the half year results in February, we'll have greater clarity on exactly how that's going to play out. But I mean, there are going to be implications for our consumer bank, where the issue arose. There's going to be implications for our technology and digital areas, I expect. There's clearly going to be implications for our risk management teams, both line 1 and line 2. So there are there's going to be a lot to work on here. But in the discussions we've been having internally, we want to make sure that those that need to be involved at this point of the process are giving the appropriate level of focus to this, but let's not swing the whole organization to be 100% focused on AML because we still got a business to run.

Okay. And then just the second question, just on the growth you've talked about today, getting back to growth in mortgages and still maintaining some margin management there. But also you mentioned price is part of it as well. Can you just talk about more in the medium term getting to that 2030, how you're thinking about growth? Do you think around system? Or do you think you need to grow above system to get to your targets?

Yes. Look, in the short term, probably the next 12 months or so, we'd like to be growing at around system. As we continue to build our capabilities and drive productivity importantly, so we can see more of the NII dropping to the bottom line, that's when we think we'll hopefully be in a position to start to take some market share again. If you look back over the last 5 or 6 years, we have grown market share. Now there's been ups and downs on margin over that time. We want to try and get a much more steady approach to that margin management. And so over the course of the 4.5 years left of this strategy, we would like to see us grow market share once we make further progress on both the deposit capability and the productivity focus that we've got at the moment.

B.J., please.

Brian Johnson, MST. Richard, a few questions. And I appreciate the fact that there are things that you don't know about the AML. There are things that you do know, but you don't want to answer. And unfortunately, I think there were some questions that you should answer that you probably don't want to answer. So if we ever look at the kind of trajectory of AML problems at banks, it strikes me that if you go back and look at it, CommBank got a pretty big fine. Westpac got a gigantic fine. The Westpac mine was demonstrably bigger because they hadn't kind of seen what had gone at CBA, NAB got a fine of 0 because they were very compliant. So the first question, I'd like the subset of the questions on this, then I have another one on costs. Is that if we have a look at the AML issue, was this just a suspicious transaction identified in one branch? Or was there some money laundering? If there was only a suspicious transaction reported in one branch, but we've found a control deficiency, were there other breaches in other branches? And then coming back on it is the real problem that you've got is that while have you gone, for example, and I apologize for this question, have you gone and had a look at the control environment, for example, in up to make sure that it hasn't got the same dynamic coming through. So can we get some detail on what the actual transactions were? Was there some money laundering involved? Why it only -- did this only happen in one branch? Did it happen across multiple branches? And have you -- have we got the same control risk outside of the branches. And then over and above it, you've got 2 types of branches. You've got corporate branches and community branches. So could you unpack that for us, please?

That's a lot of questions.

How [indiscernible] we got. Look, the actual transactions, I can't comment on because they are still subject to law enforcement activity. So there is law enforcement related to those activities. And because of that, for legal reasons, I cannot comment on that. So that was the initial issues identified. We -- once we identified those and they were escalated, we then let the regulator know and law enforcement. Both of those parties were then involved on an ongoing basis. In parallel, we asked Deloitte to do their review, which that review did not go beyond that branch, but it did identify there are deficiencies in the way we are monitoring and controlling AMLCTF more broadly. Now I'm trying to catch up with that question 5 or 6. At this point in time, I'm not -- we have not done a full review of all branches and all transactions. But to this point in time, that is the only issues that have been identified. I'm not going to sit here and say, if -- once we've addressed those control issues, we may go back and then reassess other transactions there may be identified. I don't know. These are all hypotheticals at this point in time. We've got more work to do before we can give an answer to those questions. From a look, the reality is that the transaction monitoring that goes on in our organization is the same, whether it be through Xavier's Up business, whether it would be through our branch network, through other channels. Those transaction monitoring activities that were being undertaken, we've identified deficiencies. So we need to understand what risk is involved more broadly with those deficiencies. That's part of the work that's going on now and how we can then close the control gaps, whether we then need to go back and reassess historically, I don't know. Again, these are things that are very much in front of us to work through. And I'm sorry, I can't be more definitive than that on this matter. But it is very early days, and this is one of the challenges arguably in us coming out early with this because I know it's going to be frustrating for all of you and others in -- with lots of questions that we're just not in a position to be able to answer yet.

Okay. And historically, Richard, that's a great way to attempt to answer the question. But I look forward to finding out more about this over time. And I would encourage you just come out as you know, tell us. The second question is, Richard, if we have a look at the housing market at the moment, housing lending in Australia, Macquarie is still out there pricing well below the peers and pricing up deposit rates. Of late, we can actually see Bendigo and Bank of Queensland for that matter, have basically repriced home loans up and then recently have cut them back down. But if I have a look at the deposit product at 4.85% against an owner-occupied mortgage of 5.39% and I pay out the mortgage broker commissions more often than not, it doesn't seem to me like there's a lot of margin between the 2. What is the -- are you writing home loans at the moment below the cost of capital?

Short answer is no. I'll let Andrew and unpick some of this a little more in a second. Picking, for example, the highest possible rate through Up is not the weighted average interest rate that Up pays on its deposits. Its spread is well above 2% between its deposit rates and its lending rates. So we're very comfortable. In fact, it's a strong ROE return through the mortgages we write there on the basis they're funded by Ups deposit. The changes we made recently were on the investor side of things. Again, the returns post those changes are above our cost of capital. We deliberately did not go in Owner Occ because that's where the returns are tightest at the moment. So we've been tweaking some rates here and there to generate some -- help support some stronger flow, and we're seeing the benefits of that alongside some stronger flow in our resi -- sorry, in our retail business as we've rolled out the platform there. But Andrew, I don't know, if you want to add to that?

I think you've just answered the question beautifully.

So Owner Occ is below the cost of capital and investors above?

Owner Occ, if we were to cut pricing further in Owner Occ in broker, that would be below cost of capital. So that's deliberately why we've not moved pricing in there. Where we're growing the book is in digital, proprietary to an extent in our community banks and in broker, but investor. And so when we do our calculations of marginal return on equity, we've got a hurdle rate that we want to meet, and we're comfortable meeting that hurdle rate. That's why we're only being very selective, Brian, about the way we price. We're not pricing -- we're not trying to grow volume by cutting pricing across all products. That doesn't work.

But just to clarify, am I right in concluding that Owner Occ is basically below the cost of capital. The front book through the broker channel. Is that...

At our current price point, where we're not writing a huge amount of volume right now, it's around about the cost of capital.

It does depend on the LVR at different point -- price points.

Carlos Cacho from Macquarie. On your -- your productivity agenda, we've recently seen one of your peers announce for the first time an offshoring of some more basic customer-focused roles. Do you have any plans to do similar, whether it's accessing more technology talent like peers have done or the lower-hanging fruit of customer service, like it seems like some easy ways to potentially reduce costs over the medium term.

Yes. I'll get Kieran to speak a little bit about the tech side of things in a moment. I think it would be an unusual action for our business and with our culture to put customer-facing activities offshore. Now I'm not saying that's an inappropriate thing to do. But culturally, that's not something that's on our agenda at this point in time. But we already use offshore-based skills in the tech space. But Kieran, do you want to add what your thinking is there?

Yes. So again, we touched on this a little bit earlier. And so we've been quite transparent on this point with the partners. So for the 60 we referenced before, one thing that's interesting here is the majority of those partners' resourcing is here is actually resident in Australia. And so that is an immediate opportunity. And so a feature of that rationalization down to the low single digits that Andrew talked about earlier will mean that more of that work that those partners do today will move overseas. We are in the process right now of looking at various options on what that might look like, and we'll look to execute on that in the second half.

And just around, I guess, back to the mortgage kind of margin discussion. Given -- as you noted, the mortgage growth and margins have had some ups and downs over the last few years. How can we be confident that getting back to system growth isn't going to come at material cost to margins? I guess, can you share us what your learnings have been over the last few years and how you will do things differently? It's all well and good to say it will be deposit driven. But if the deposits aren't there, does that mean the mortgages aren't going to be there? How do you balance those 2 things? Because from the outside looking in, it has appeared at times like it's been a very difficult balance to get right.

Yes. I think -- thanks, Carlos. I think the lessons of the first half '25 have stuck with the organization. And we had a rollout of a platform, which was very successful, more successful, I suspect, than probably what we had anticipated, and that required a funding response. When we got to the point where we said we're growing too fast, we made then pricing changes in a couple of tranches, and then that slowed the volume down. That gave us a few key lessons. 1 was around the volatility in our margin, which was not what we wanted. The second was it gave us a clear sense as to where we needed to price the book to grow. And I've mentioned this before. So we've got a pretty clear sense as to the price point at which we need to set our mortgages to grow at a certain level. And so the way we construct our plans, and I referenced this earlier, is we've got a number of applications per day that we target. And the way that we think about that number is we figure out what that means in a volume sense. And if we feel comfortable that we can then fund that as much as possible with lower cost deposits, then we say, okay, that's the number we go for. And so what we're doing is using price as a lever to control the flow, taking into account how much flow will move to a settlement, we'll move to then a loan on the balance sheet. That's why we do it.

Is that, I guess, a new initiative looking at that applications per day? Or is that...

No. No, I think they are connecting Up of funding and making sure that we support lending growth with as low-cost deposit funding as possible. And then some of the more recent digital work we've done to build our lower-cost deposits, so transaction accounts is helping to underpin that. But it was a critical part of the strategy that we -- that Richard took to the Board back in June of last year.

Next question. Christian?

Christian [ Mazer ], Jarden. Just back on deposits and with Up, you mentioned the strong growth that you've had and the new grow and flow offering that you have. How exactly does that interest rate structure work? And is -- are you attracting those new customers through price? Or is it more the offering that you have?

So I think it's the offering we have. Like if you want to get the highest interest rate in market for your deposits, that's not us. We're pretty competitive versus the majors, but we're not sort of total best in class. That's a deliberate pricing strategy for us. So I don't -- it's not 100% price driven. I think previously -- so sorry, what is it? That will help. So we sort of have a 2-tiered interest system. If you don't withdraw, you can get the growth rate, which I think is about 4.6% at the moment. And if you do withdraw, you get a lower flow rate, which is 1.25. This matches up with how a lot of customers use save. A lot of saves are actually used in a more transactional sense and they're the sort of flow savers and then sort of nest eggs or emergency funds, that's sort of what tends to attract the grow rate. Previously, we didn't have this sort of -- and you also need to be doing 5 qualifying transactions as well. Previously, we only had the qualifying transactions criteria, but our headline rate was sort of high 3s. And so what we're finding is sort of in this middle ground where for people who wanted a higher interest rate for their [ NestJS ], we didn't have a product for them. And then for people who are really using it for sort of financial funds, we were probably overpaying. So sort of in this middle area. So now we split those 2 and that's provided a much more suitable product for a lot of people who were keeping a lot of their deposits elsewhere, but also just made the whole offering a bit more compelling for people. So I will say we do have some customers, who don't like it, like it's not a slam dunk, and we knew that going in. We did a lot of research into this. But sort of on net, we -- more customers were interested in it than not, and that's come through in the numbers.

Second, Brian, just let Christian finish if that's okay.

Is it one product that flips between 2?

Yes.

So it's still an underlying just Up Saver product. And then depending on your activity for the month, it qualifies for the different rates.

Yes.

There's a really good explainer on the website. If you link through to growth flow, it's got a really good -- that sort of lays it out really nicely.

Next question [indiscernible].

So can I ask about your digital onboarding? So first, you talk about 50 transaction accounts per day. How do we benchmark against the current onboarding without the digital capability? And then secondly, you're talking about increasing marketing expense. What kind of magnitude are we thinking about? And what type of marketing campaign? And is the customer acquisition cost at a similar level at ARPU, which is you mentioned $50? Or is it significantly different?

So I'll just quickly answer the first bit and then -- so we were really just not seeing much at all previously through the prior onboarding that we did have. So it did technically exist, but like we were seeing a handful of day that. So it was basically nothing, and now we're seeing quite a lot more. So that's sort of the first part. And then second part...

Yes. From a marketing perspective, we've been increasing our support for low-cost deposits in the run-up to digital onboarding. And now we'll start to build that. So the way that we work in marketing is we optimize the activity to where we're seeing performance. So you'll see our marketing of the digital onboarding product, or fast sign-up for customers build into the new year, and then we'll trial campaigns if we need to. But I think previously, when we think about kind of we've talked previously about the demand we've driven, we've got a lot of latent demand there anywhere. So the brand connects with customers. It drives demand. And when they were coming to us, they couldn't sign up through the app to onboard. Customers can now. So we really need to get that balance right of what do we need to actually market versus optimize the demand that was already there. But yes, you will see it still build next year.

Maggie, one of the things that -- I mean, I'm a bit of a junky for the dashboards on these things. I probably hit refresh too often to watch how the numbers are flowing on a daily basis, but they have been growing since we launched quite nicely. And so I think Tuesday, we had 70 new accounts. So it's -- on average, it's been about 50. But in the first few days, it was 30, 40, and it's continuing to grow. Look, first, I want to get to 100 a day. And that's probably going to be I mean, 30,000 customers we wouldn't otherwise have had. And then if we can really start to ramp up the digital marketing and from a marketing perspective, it's not like we're going to go and spend an extra $5 million if it were otherwise. It's about -- Sarah doesn't get that much from me to play with. So she has to put it where we think we can get the best value. But I don't know, where the potential ceiling is on this. I mean we have a long time, I think, before we get to Xavier's 500 a day. Cost of acquisition actually is probably actually lower than Up because we're not paying referral dollars on this. So it will be a very low cost of acquisition at the moment.

James, do you have any media questions?

It's David Ross Australian. Richard, I had a question for you around AML. Can you tell us specifically which was the branch affected that you've referenced? I mean Bendigo has released a closures impact statement for every branch it's closed apart from the Pinewood community branch in Mount Waverley in Melbourne. Why was the Pinewood Community branch closed suddenly on 9 September and the franchise agreement terminated with no reason provided?

As I said before, with legal activity underway, there are certain things we can and can't disclose. And we're not, at the moment, in a position where we can identify the branch that was the source of those transactions.

I just also wanted to ask, obviously, Bendigo has had it community branch model for a while. In your view, I know everything is preliminary and the final Deloitte report is still yet to come. But has there been any indication if that model exposes you to more risks, particularly on AML?

So I think the community bank model is 28 years old now, and it's been a wonderful supporter of our ability to grow our business and also to grow our deposit base. The reality, as we do this review, we'll look at all aspects of our business. But over that 28 years, there has not been a particular skew that I'm aware of between community banks versus company-owned branches from a risk perspective. They all have to meet the same policies and procedures, whether it be a community bank or a company-owned branch. And so I wouldn't expect there would be a particular skew there, but we haven't done that work yet.

Nicholas?

Nicholas Sobolev, UBS. Just regarding the RACQ book, are these loans predominantly owner-occupied? And once they're brought on to the balance sheet, how are they going to impact NIM for the group?

Yes. So 79% Owner Occ. The margin on their loans is comparable -- or sorry, the rate on their loans is very comparable to ours. So they'll be transitioning across to a Bendigo product at time of completion. There is only one deposit product, where there is any significant variation between any terms and conditions, and we'll work through how we might grandfather some of those terms and conditions for those customers. But when it comes to the lending book, that will be a straight transition. They will continue to get the rate they have. And as rates move up and down, it will be from that rate. But there's no -- we're certainly looking through the book, we're very comfortable with the rates being offered on both sides of the balance sheet.

Okay. So for that 79% roughly would be written above cost of capital from your point of view or at like the rest of the...

Look, the reality is where those loans are coming on to our book with the only acquisition cost being the transition costs. So I mean, you could do a range of different ways of working out that cost of capital. But at the rate they are, we're certainly very comfortable that they'll be paying their way. And as I said, more generally, the -- when you look at the acquisition, it's going to be strongly accretive from an ROE perspective and also generate up to $0.05 per share on an EPS basis.

Thanks, Nicholas. Time for 2 more questions. I can see Sally's hand up.

It's Sally Hong from Morgan Stanley. So you noted that Up Bank is becoming profitable today. Can you talk to me about how does Up Bank's like cost-to-income ratio compare with the broader group? And can you give us a sense on how Up Bank will contribute to taking Bendigo's ROE above 10% by 2030?

So maybe I'll start and then Andrew, if you want to comment on some of the longer term, how it fits in. So I mean, we've just hit profitability. So right now, the income is 100% right. But I think if you look -- if you sort of extrapolate out in terms of our -- the number of humans and technology costs we need to support the business, the marginal cost of adding growth, our expense profile is pretty flat. And so the -- I expect that, that will continue to improve. And if you -- and long term or even medium term, we'll get under the sort of group CTI like relatively quickly. I'm not looking at -- like if I sort of look out in the next couple of years of growth, I don't need to drastically change my expense base to support that. So that's kind of how I'm thinking about that. And then do you maybe want to speak to the longer term, how...

Is the absolute key is that we are putting capital to work in that business. It's fully funded or more than fully funded from a deposit perspective today. The cost of that deposit stack is attractive. So hypothetically, Dave could grow his book by double and the marginal costs are pretty small because of the efficient platform that he's built. And so the way that we think about that business is we'll continue to allocate capital to it whilst it's delivering such attractive returns while it continues to gather customers at the pace that it does. So that's how it contributes. It's a very low additional marginal cost as we bring more assets on the balance sheet.

Thanks, Sally. We'll finish with Richard.

You've talked about some of your productivity initiatives, your headcount reduction, your outsourcing initiatives and rent are good examples. Can you quantify the cost savings that you expect to get from these initiatives? And if you can't do that today, do you have any plans to quantify the cost savings perhaps at the first half result?

Yes. So again, what we think is most important here is what it actually means from an overall cost perspective because I could give you a number. But if I don't give you a reference with that number, then you might say, okay, well, what's happening with the rest of your cost base? And so the way that we've described it, Richard, is to say that those costs and the savings in those 4 cost pools that I referenced earlier will help us to manage our overall cost growth, our business as usual cost growth to now higher than inflation. Inside that, yes, we know what the number is. We'll take it on notice as to whether we quantify that or not. But what you will see over time is as we execute on those 4 key initiatives, it will translate then into the cost base, whether that's through FTEs, lower rent, whatever it might be.

Andrew, there's an alternative way to look at that. We could say if you do nothing, your costs are going to grow 5%, 6%. We know your amortization is going up. So we want to know what cost savings you expect to deliver to get to that BAU within inflation. So I think it would be helpful if you disclose some expected cost savings. You have done it in the past. Other banks do it. So I think it would be helpful if you disclose that at the first half result or when you're ready.

Sure. We'll take it on notice.

Thanks, Richard. Thanks, everyone. I'll hand back to Richard for final comments.

Thanks, everyone, for the questions and some really good questions there. Based on what we know today, we do remain committed to our target of achieving an ROE above 10% by 2030. This is a goal that drives our business priorities and decisions, and we will keep you informed with our progress on that as we continue to drive our strategy forward. So thank you for coming along today. We appreciate the time you've taken and look forward to joining you for some refreshments, if you got time now that we finished the formal part of the day. Thank you.