OTP Bank Nyrt. (OTP) Earnings Call Transcript & Summary

Dear ladies and gentlemen, welcome to the OTP Bank First Quarter and Full Year 2021 Conference Call. This conference will be recorded. [Operator Instructions] May I now hand you over to Laszlo Bencsik, Chief Financial and Strategic Officer. Laszlo, please go ahead.

Okay. I was not -- okay. Sorry. I wasn't unmuted. So thank you. Good morning or good afternoon, depending where you are, and thank you very much for joining us today on OTP Group 2021 fourth quarter and annual results presentation and Q&A, hopefully. Thank you that you dedicate your precious time in these turbulent times of today, especially. And as usual, we have this presentation on the website available. And also, since we are doing it through Zoom app, we can hopefully see it on the screen as well. As usual, I will go through it, but rather briskly, I guess, this case because I'm sure most of your interest today is not around what we did last year. However, performance was really exceptionally good last year, I think, but I'm sure all of our attention now is on the events in -- tragic events in Ukraine and the ramifications with precautions in Russia especially. So obviously, this is where I'm sure most of your attention and certainly our time and effort to spend during the last 2 weeks. And I will try to do my best to give you an update. We have a modest number of slides on this, only one in this bag, but hopefully, I will be, in case you have questions, elaborate a bit more on the situation as of today in these 2 countries. So starting the kind of usual part of the presentation, Page 2, highlights of our result last year. 60% after tax -- for aftertax adjusted profit increase due to 2 factors: very strong operational performance, 23% year-on-year operational profit growth; and the moderation of risk costs after the spike in risk costs, what we had in 2020 due to the COVID situation. And these numbers are not distorted by acquisition so much because we did not acquire anything last year. And there was only a divestiture back in 2020, our Slovenian -- very small Slovenian bank, so pretty much these numbers provide you a good reflection of what happened. Really terrific year, I would say, last year, very strong volume performance. You will see that our performing loans grew 15% year-on-year. And also the margin started to level up, started to normalize. Even if you look at the fourth quarter figures, net interest margin increased group level, so that hasn't happened for -- or had not happened for quite a long years. And now we have a quarter where actually there was an improvement in the NIM. Capital position, I think, highest ever. So we have, at least in terms of common equity Tier 1, 16.9%. Common equity Tier 1 at year-end, obviously, this was boosted by the sale of treasury shares. If you remember, during the fourth quarter, we had a transaction where we sold around 4.5% of our treasury shares to an entity of 4.3, something like that, or to owned by employees, it's a special intro. And liquidity, equally strong. Group level, 75% loan-to-deposit ratio, strong liquidity ratios. In Hungary alone, we are sitting on more than EUR 9 billion equivalent of liquid assets. And you will see that, in fact, last year, not just -- I mean growth rate -- I mean, deposit growth rate was actually higher than loan growth rate. So deposits grew at 16%. And given that there's 75% loan-to-deposit ratio, that meant that we actually generated a lot of excess liquidity last year. In half terms, it was kind of 1 trillion, the difference between deposit growth and loan growth. Going through some of the details, and I promise I'll try to be quick here. So here, you can see the overall consolidated accounting profit and the differences, what we usually make adjustments, this usual item, the bank tax. And then we had this very specific situation to 2020 and '21, the moratorium, especially in Hungary and the accounting adjustment, the loss that we had to book due to these. Obviously, this reflects the time value difference of the cash flows because we do get back these cash flows, what we -- during what -- which we were suspended during the moratorium. And the only difference is that it comes later in time, so therefore primary went down. And this was -- these were one-off adjustments last year and in 2020. And then gradually, we drive back these into NII as if nothing happened. And then some costs related to the mergers and the previously accounted for PPAs in case of acquisitions, which you have to amortize. This is the number what you see here, typically after the acquisition as long as the merger continues and that typically takes 1 or 1.5, 2 years. We have put here for the costs related to the merger and even after the merger, if we have a post-merge project, we typically put the additional cost of the projects on this one. If we look deeper into the adjusted profit, obviously, what you saw on the first slide reflects back here as well. So very strong 23%, but with some adjustments to make it really kind of apple-to-apple comparison is 19%, with 13% income growth and I mean, again, with proper adjustments, 8% operating expenses. And especially, I think the revenue growth is quite strong. And the fourth quarter was especially strong [ served ]. What we saw last year was a kind of quarterly acceleration in revenue growth, which was actually quite good development. And if you look at the entity results one by one, then across the board, we see improvement. I mean it's not surprising, obviously, the economic environment last year was much better than in 2020. But some numbers like stand out, I think, especially Serbia, where we finished the merger and now we started to kind of reap the benefits of the new unified entity and is performing very well. Croatia was particularly strong, Bulgaria, but also Romania, I mean, at least year-on-year. But here, it's the bit for a kind of interim period, the focus here is not the growth and not so much profitability or profits because now we got to execute this organic growth strategy in Romania. We continue on that. And then as you can see, Ukraine and Russia did incredibly well last year, and this makes it for us even more sad and regrettable that these recent events seem to have a very strong negative impact on the earnings potential of these entities. Not so much about general total income, but maybe 2 sorts about total net interest income. So we can go to Page 7 now. It's a strong growth quarter-on-quarter, especially in Hungary, but roughly HUF 7 billion was a result of kind of ALM transaction, which had one lag here, another lag in other income. If you kind of net the 2, the impact was slightly positive. But you have to keep in mind, as we've said, put it in the tax tier, that part of it was not kind of business-related but more technical. And then I think it's important to note that despite the profit improvement in Russia last year, in fact, revenues, net interest income went down year-on-year because of lower margins of the operation. Maybe if we go to Page 8, we can see the margin. This is what I mentioned at the beginning. So after so many years of declining margins, we had the fourth quarter last year showing some improvement, strongly boosted by the OTP Core, the Hungarian one. And here, as I just said, part of it is actually technical. So it's not going to stay with us. But nevertheless, it's positive. In any case, there's some improvement, which we're quite happy about. Volume-wise, fourth quarter was strong, 4%. And I would say strong across the board, especially Russia, Ukraine, again. Finally, Russia started to grow. And you remember, for quite a long time, I mean, we were -- I was explaining the kind of difficulties we had in terms of our strategic positioning and so on and so on. And I mean the fourth quarter started to show signs of some life in terms of volume development. And Ukraine was just extremely strong. And then the rest of the group was also strong. And with all of this, we ended up last year with 15% group level performing loan growth, which is exactly what our last guidance was. So if you remember after the third quarter, we said that maybe we could expect around 15% and it was exactly 15%, the number. Hungary was a very strong, 19%, consumer lending, housing loans, corporate. And here, there were some bolstering by the moratorium. So basically, there's a technical uplift on the growth rate in Hungary, 3 percentage points in Hungary and then kind of 1 percentage point group level due to the fact that we had this kind of large participation level, high participation level, moratorium -- payment moratorium, and that obviously had a positive technical impact here. But even without that, I think it's quite an outstanding result. And again, Ukraine more than 40%. Last year, Ukraine was showing extreme -- I mean -- I think, not extreme, but very strong overall economic performance and -- okay. So if we go further, you see the deposit growth, and maybe it's better to look at the annual one. So if we move one more -- yes, this slide, yes. 16%, as I said, and then if you -- and ended up almost HUF 3 trillion deposit growth and almost HUF 1 trillion more than loan growth volumes. Our kind of deposit to loans liquidity gap increased group level and some countries was exceptionally strong, especially Hungary here. And I mean, in a way, it wasn't very -- for a number of years, we could not do much with deposits because of the very low yields. But in fact, with this higher rate environment, we started to make considerable money on deposits. So we're actually quite happy to see this deposit increase. And financially, because it's always a good news, it shows we've kind of -- the level of satisfaction of usually of our clients with services of the banks. But now we started to make serious money on deposits, especially in Hungary, which is not the case for many years. So we're particularly happy about this development. On Page 13, you see the net fee income. And again there are 2 events, which technically moved the numbers down and up. The downward was this kind of usual one-off payment, what we have to pay for cashbacks, refunds for credit cards, and we always account for this in the last quarter. It came in as well in Hungary, part of this -- actually, almost all the quarter-on-quarter decline is explained by that. And then the other quarterly development is the Fund Management fee, success fee. They did a good job last year, so they got a success fee, but on a year-on-year basis, granted they had done even better, so kind of year-on-year, there's a decline in the success fee. But overall, I think the net fee income growth was quite strong last year. And that's just a reflection of very, I mean, strong increase in economic activity and increasing inflation and basically fee income is related, in our case, mostly the transactional activity, and transactional activity is typically related to nominal GDP growth. So it's not surprising we had such a good year, especially because 2020, the base was weak due to the first waves of COVID when there were serious restrictions. Other income. Again, as I said, there's this technical kind of other gross lag of the kind of ALM position closing and changing during the fourth quarter. So that's actually counterbalanced by revenues in -- shown in interest income. And other than that, is the Others line, which was strong. We included a couple of entities into the consolidation like we have a travel agency in Hungary and then we were quite happy that the private equity kind of division of OTP, which is called Portfolio Lion (sic) [ PortfoLion ] starting to show very good results. So we have some strong contribution to profits coming from this activity, which was presented in the numbers last year. And then we have other entities which we consolidated back -- at the beginning of last year. Actually, again, we have this cost and revenues, revenues shown here in other income and costs in -- on the operational cost line, which you will see. So that, too, you have to net out in order to get to meaningful numbers. So roughly part of these others -- half of this others growth was due to this kind of gross representation of some activities, which we recently consolidated. Operating costs, I mean, in Hungary, we had a kind of relatively strong year-on-year cost growth, but part of it was due to some technical changes or kind of accounting methodology changes. We increased the provisions for untaken holidays, assuming that everything will be taken out. And we also increased provisions for this kind of expected on the anniversary bonuses. So every 5 years, we pay out kind of 1 month extra bonus to employees who stay with us long. So that will be reflected better in our books and that resulted in a one-off in the fourth quarter. But even without that, we had a 9% year-on-year cost growth in Hungary, which is certainly reflecting the high inflationary environment last year plus the tight labor market that we have, and also the strong development, especially in IT and digital, which is always costly. The good thing is that in some countries like Bulgaria, we continue to realize, as you can see from the year-on-year number, the kind of long tail of cost synergies and Serbia started to provide cost synergies and Montenegro started to provide cost synergies. So these are the countries where we have recently completed mergers. And then Romania had a rather high cost growth, but again, this is related to this kind of organic growth strategy. And on the Others line, you see this kind of technical impact to the other -- the negative lag of these other activities, which have some costs. A few words about Hungary and the acquisition in Hungary, and our home market is -- I mean, remains strong, obviously, and we achieved some, especially the year-on-year numbers, which you don't so much see on this chart, but maybe you have to believe me. Cash loans and mortgage loans, I mean, special cash loans market share year-on-year improved a lot. So we were quite happy with our relative performance, not just the absolute performance last year. And again, importantly, I mean, the household savings market share continue to be kind of stable and strong. And as you can see the next chart, we have remained very active in distributing this kind of policy subsidized structures in Hungary for [ OTP ] clients. Obviously, these are very decent profitability products and the market share tend to be higher than some of our -- than in kind of some other products. Really this is a strong focus of us. We always try to be available for the whole network for our clients. They want when they are available and then make it very convenient and easy for clients to use. So maybe that's the reason that we tend have a much higher share. The Green Home program, that's the most recent one, it started in October last year for housing loans, subsidized. Interesting case, the home is energy-efficient. It's very, very popular. So we kind of continue to be very active on this front. In terms of corporate, likewise, last year was, I would say, exceptionally good. I mean you can see our market share improvement in terms of kind of year-on-year growth, this was the strongest. So we went up from 16.6% to 18.6% in terms of market share of corporate loans. And on this chart, you see the long journey where we started back in 2008. So this is -- it's really this kind of redefinition of our footprint or profile in the Hungarian corporate continues and, I mean, quite happy to see that, and it's a very kind of strategic move, from our perspective. This was also supported, this good performance, by being stronger than in some other products and these kind of subsidized schemes, which came from the Central Bank, the Funding for Growth Go! program, which has -- where they're being discontinued, but were still strong last year. And the newly introduced Széchenyi Card Go! structure, which is a kind of SME-targeted, relatively attractive kind of working capital loan type of structure for SMEs. And then Page 19, you see the current status or the year-end status of the moratorium. Moratorium was restructured or the last phase started in October, where clients actually had to apply for the continuation of the moratorium and surprise, surprise, all of a sudden participation rate dropped substantially. So it's not any more a kind of structural element. It's still there, and it's going to expire end of June, but it's no longer kind of factor which strongly influences numbers or something which should be kind of taken into consideration. In terms of development, we have a few slides about digital. Obviously, probably it was very difficult and had negative ramifications, but one aspect where it was, at least from a banking point, the view was positive that clients increased or accelerated their usage of digital channels, and that really in 2 years, we more than doubled our -- for instance, the regular users of the mobile banking application. And it's not just the kind of customer usage profile, which shifted, but we also renewed substantially our services. So last year, we came -- we launched our new Internet and mobile bank. It's completely new platform, new system, in-house developed and kind of practically different client or user experience. And so far, the feedback is overwhelmingly positive. ESG, it really became strategic for us last year, and it was a very concentrated high-level management effort to structure this initiative -- group of initiatives into a very solid and very well represented organizational structure and detailed strategy and very specific actionable initiatives, which should drive our performance on this front for the future. So there's really a lot of commitment and drive in the organization for achieving these goals and then to continue to improve in that front. So I think this was a big push from us and actually the CAR started to draw funds. So I think we will soon see further improvements hopefully in our ratings and what we do will be reflected in this objective measures as well [indiscernible]. I mean, again, last year was good profitability, high nominal profit growth, strong volume growth, very strong -- strongest ever capital position we closed last year and strongest ever liquidity position. And on top of that, we continued our kind of more conservative provisioning approach, maybe more conservative than some of our peers, as you can see, especially for performing loans. Stage 1 and Stage 2 loans, we continue to provision as a percentage of the volumes that we have considerably more like between 4 and 2x more than some of our regional competitors. And we did not last year, release the provisions that we created for kind of in terms of additional conservatism in 2020 when the COVID situation started, kept this kind of higher level of provisioning still. A few words about -- or details about capital and the common equity Tier 1 ratio development. We see the kind of requirements here as well. The requirements increased year-on-year. So we have -- you may remember this other systemically important buffer, which used to be 2% prior to 2020. When COVID hit, it was reduced to 0%. And in 2020-'21, it was 0%, and now it started to increase gradually. So this year, it's 0.5%. Next year it will 1%. And then we go back to 2% in 2024. And our SREP ratio or Pillar 2 ratio also increased to 125% as opposed to the 117%, which we used to have for a couple of years. Okay. So much about last year. And I will attempt to give you a kind of review of the situation in Ukraine and Russia. We were really shocked by what happened, and it's going to surprise us so we were -- it seems unbelievable that something like this could happen and with war in such a large scale and tragic and war can -- broke up in Ukraine. And obviously, the situation is not easy at all. So we have colleagues there who heroically maintain the operations of the bank. Services are available. So whenever a branch can be open, given the security considerations of our clients and employees, they open the branch. And so still roughly half of our branches are open. Cash transactions are kind of available. There are certain limits, daily limits for local currency and foreign currency cash withdrawals established by the Central Bank. Obviously, lending activity froze. Online Internet banking is on and we -- as much as we can, we do everything to service our clients there. Very positive saying that actually deposits, in fact, grew the deposits and retail deposits increased, if we -- as you can see on this chart, from 23rd of February when the broke started -- when the war started and between 3rd of March, 4% increase. And even yesterday, we had an increase in deposit volumes. So we try to do everything to provide -- continue to provide our colleagues there in Ukraine who are working under very difficult conditions to provide services. And so far, it continues. Plus, obviously, we try to do everything as much as we can as an institution and also as individuals to support people who decided to leave Ukraine and the refugees. And there's a large number of refugees already entering the country, and we try our best to support them. In terms of -- in Russia, the kind of operational situation is obviously not under so much pressure. We operate all our branches as usual. Again, deposits are growing since 23rd of February, retail deposits, and lending activity is very limited. We -- first, we stopped and then we restarted our POS lending activity very selectively, but we do provide some POS loans at the moment. It's the previous restrictions, the cap -- the APR cap was released. So obviously, we provide these POS loans at a much higher rate than we used to. This very curative capital regulations were somewhat eased. So the risk weights for our APR, POS and cash loans were reduced. We still -- we are still much higher than like Europe or other parts of the world. But -- and that created actually a considerable excess capital buffer in the bank. So it's like RUB 7 billion more -- RUB 7 billion release in a way of capital requirement happened just because of this, in rubles, in the last couple of days. What makes operations difficult in Russia, is the financial intermediary sector. We -- our primary retail bank there, where we do have a small treasury, and it's very difficult to kind of maintain the treasury operations with a central bank, which only selectively or partially functions, basic kind of instruments are not fully available. So it's a bit of a difficult year and involves extra cost to manage the kind of small treasury portfolio. Where we have, we cope with the situation. But this is -- I mean, that's the operational challenge to say at the moment in our Russia business. If you look at the financials, then I think it's worth to calibrate the size of our exposure to Ukraine and Russia. And on this slide, you can see pretty much every important metrics. Maybe the kind of 2 most important one is the share from the group profits last year, it was 15%. So in a situation where we are unable to conduct business in these 2 markets, and this is the kind of potential profit stream, which we may lose. And then I think it's also quite important and interesting to know that if we -- again, we are unable to sustain our operations and then have to deconsolidate these operations, then the impact on our capital -- common equity Tier 1 capital ratio is what you can see here, so 27 basis points for Ukraine and 116 basis points for Russia. That means basically writing off these operations and also writing off the group funding -- the gross group funding to these 2 countries that we provide. By the way, we don't fund the banks in these countries. In Ukraine, we provide funding to the leasing entity there, and the bank keeps dollar deposits in OTP Hungary. And on this chart, you can see the gross and the net amounts, the kind of end of February figure was HUF 9 billion net. But the gross number is certainly bigger than what we provide to the leasing company, and that HUF 75 billion was included in this calculation, and we calculated the 27 basis point loss. So that was calculated in the assumption that this gross funding will be lost. And in terms of Russia, the total funding, net funding and the -- here, there's no net. So it's just the gross and the net is the same, it's HUF 50 billion equivalent. So that's it, basically, that's the situation today. We do have some more exposure to Russia and Ukraine outside the country. We have some sovereign bonds. So we have on the kind of year-end number basis and exchange rate basis, HUF 88 billion equivalent of Russian sovereign bonds in Hungary and HUF 13 billion of equivalent of Russian sovereign bonds in Bulgaria. These are kind of -- the maturities of these bonds are between 2025 and '28. So kind of longer maturity instruments. And then we obviously have some -- we have clients who have kind of exposure to Russia and Ukraine across the group. Having said that, this is relatively moderate. So all in all, we're kind of screening the portfolio. We found basic -- around EUR 500 million funding or exposure to clients who have strong kind of business-wise connection with Russia that either they are kind of sourcing the -- their raw materials come from Russia or they export to Russia. And so that's the portfolio which we kind of consider at risk. We have very few clients, I mean, maybe 1 or 2 who have kind of strong -- similarly strong exposure to Ukraine and that's a much smaller amount. And then there's obviously another kind of potential spillover effect to other countries where we operate of the situation in Russia and Ukraine. That is obviously much more difficult to assess and calibrate. And naturally, that depends a lot on what the outcome of this tragic situation is going to be. But the very obvious development is increasing inflation. We already see energy prices further increasing and also food and especially kind of grain prices increasing. Ukraine is obviously a large producer of food stuff. So that is -- I think, that's -- absolutely sure I think that we should expect a higher inflationary environment -- even higher inflationary environment this year than in prior years and that might have an impact on the economic environment in the countries [ we're in ]. And then finally, [indiscernible]. First of all, we -- I think we did well on what we promised last year. The ROE, we said would be around -- between 18% and 20%. It ended up 18.5%, with a conservative provisioning, just the footnote. And we indicated maybe 15% growth of loans, and it indeed grew 15%. We started the year, if you remember, with kind of 10% -- around 10% guidance and then we gradually increased it. We ended up 15%. And then this year is obviously difficult and we plan to say more and more concrete -- to share more concrete expectations with you, but obviously, the last 2 weeks changed a lot in this sense. So we would not dare to exactly pinpoint what the end game here is going to be in Russia and Ukraine, we simply don't know, and the range of potential outcomes is huge. So we decided it's better not to try to quantify the potential outcome other than showing you a very bad scenario in the previous page when you kind of lose these operations and the funding to these countries altogether as a one-off. And then the question is what happens to the rest of the group. And again, the ranges of different scenarios is relatively big. And therefore, I don't think it's very responsible to actually tell what the numeric expectation and the most important indicators is for this year even for the rest of the group. I think -- we thought the best approach would be to start from a kind of status quo situation. So assuming that there's no material or negative impact -- negative ramification on the other countries where we operate of Russia and Ukraine. And if that was the case, then we would -- we expected a similar year to -- or we would expect a similar year this year to last year. The only difference is that may be somewhat less loan growth coming, a, from non-moratorium; b, from higher interest environment, which in some cases, especially in corporate lending, may kind of slow down loan growth. Regarding -- and then margin, again, we started to see some stabilization last year, and we believe that this is going to continue. So the margin environment, we expect to stabilize and normalize. And then all the other indicators, our initial expectation was somewhat similar to last year in terms of risk cost rate, in terms of operating cost efficiency ratios and therefore, not surprisingly, all these manifested, then we would have similar return on equity and profitability ratios and overall nominal improvement in profits. Now I'm afraid this is not going to manifest like this. And even if there's kind of -- there's a peace agreement and truce made today, a lot of harm has been done. And as we go -- and if there's no agreement today, then tomorrow, there will be more damage done. And day by day, more physical and kind of structural damage is done. Therefore, there will be obviously negative ramifications for the rest of the countries. But how much and exactly where is kind of hard to tell. If we look at the structure of these economies, I'm talking about OTP Group countries excluding Russia and Ukraine, then the economic links are surprisingly small. So typically, we have like between 1% to 3% share of Russia and Ukraine from the exports of these countries. There are some exceptions like Moldova and Montenegro for instance. But for the rest of these countries, it's typically between 1% to 3% of their exports, which are directed to Russia, Ukraine. So the impact coming from the loss of direct trade to these countries is going to be potentially moderate. Again, there are some countries, especially Moldova, we are quite concerned about. This is a country we recently entered with a -- albeit with a quite small exposure and activity. But nevertheless, we see strong geopolitical risk and large dependence on -- especially Ukraine and of course Russia in terms of economic activity. Then, obviously, overall sanctions and disruption of supply chains and redirection of supply chains and potential kind of losses of other players coming from exposures to Russia and the higher cost of energy and food, and therefore, high inflation, all of these kind of point to a direction of negative impact on the economic development of the countries where we operate. Therefore, I'm afraid we are not going to have exactly as good results as we show on this slide. Once we know the resolution or the lack of resolution of the situation, obviously, we are going to be able to much better quantify and then do a new budget and so on and so on for this year, what we should and can expect. I'm sure you are interested on the dividend. So we have this HUF 119 billion, which we promised many times to pay out. So we definitely would like to pay this amount after '19 and 2020. And we still have not decided on whether we should or should not -- should and how much or should not suggest the AGM to pay dividends after '21. We are going to have a -- in 2 weeks, we are going to have a Board of Directors' meeting and the whole management. And then there, we will carefully assess the developments related to Russia and Ukraine. And then based on that assessment, we are going to formulate our proposal to the AGM. But I think it's fair to say that it's quite likely that at least the HUF 119 billion will be suggested to be paid. I guess that was all. So the last slide is about the usual disclaimer. And I think now, especially this -- it's important because, to be very fair, and I think it's not surprising, but we don't know what the outcome of this situation is going to be. So that was the kind of formal presentation. I'm sure you have questions, and I hope I will be able to give you kind of intelligent answers. Please open the floor for questions from the participants.

[Operator Instructions] First -- the first question is from Máté Nemes, UBS.

Yes. Máté Nemes from UBS. Thank you for the presentation and thank you for sharing details on Russia and Ukraine, including operations, indirect exposures and so on. That's very helpful. If you don't mind, I would start my questions first, still Russia and Ukraine. I'm just wondering if you could share your thoughts or thought process on what developments or what change in the environment made conclude that you cannot operate in these countries anymore? What would be these conditions? The second question is still related to that. I think the Chairman and CEO, in the morning, the press conference mentioned that OTPC's long-term role in these countries, but wouldn't take the risk of substantial additional exposure in these 2 markets. I'm just wondering if you could clarify what exactly that substantial additional exposure would mean? Would you be willing to put in smaller amounts of additional intragroup funding? Or would you be even willing to recapitalize these businesses if need be? And the last question is on your inorganic expansion strategy. Do you expect an extended pause in line of acquisitions or an outright stop of the expansionary strategy? And in light of this, if you could give us an update also on the potential acquisition in Uzbekistan, that would be super helpful.

So, there is a -- there are scenarios both for Ukraine and Russia, where it's not our decision what we do. But due to sanctions either by EU or by Russia, we basically become unable to operate, and this happened in Ukraine. And in 2014, when Crimea was taken and when the eastern -- Donbas and Luhansk part of these regions were taken, we were not allowed to conduct any business activity in these parts of Ukraine. So we had to write off every exposure day 1. It can happen due to EU sanctions and we will not allow to operate in Ukraine. I hope this is not going to be the case because that obviously assumes a kind of tragic outcome to this situation. Well, I think we have to face reality that this can happen. I mean in Russia, again, it can -- I mean from most probably -- either from the side of the EU or from the side of Russia, I think the relationship can deteriorate further, and that's also a possibility. I hope it won't and I hope -- I still -- maybe I'm just -- I don't know how to rationalize this, but I still see hope for a peaceful solution. There will be so much to gain for both countries from that solution and obviously, rest of the world. But we have to face again the kind of relationship between the EU and Russia can deteriorate to a level where either because of EU or because of Russia, we are not going to be able to operate there. These are the kind of relative -- in terms of our decisions, these are obviously obvious because we don't have really a choice if that happens. Now if there's a peace agreement tomorrow and that peace agreement is recognized by the EU and kind of internationally, then miraculously, everything can turn to very positive. And then we are obviously very, very happy to continue operations in both countries. And then there's in between -- and these are the kind of 2 extreme scenarios. And in between, there are many other scenarios which are very difficult to kind of quantify and describe and pinpoint. Most of these banks are relatively -- I mean, in Ukraine, we have a relatively small kind of leasing, local currency corporate banking and consumer lending business. We don't have any mortgages. If banking is possible in Ukraine and then there's some meaningful economic activity, not to talk about when if it does a peace agreement, then we are kind of happy to continue in Ukraine. I mean Ukraine is -- again, I mean, if you look at last year, Ukraine really very seriously started to grow on a sustainable and very promising path, I think. And that's makes it even, I think, more sad, right? I don't know how to say -- or tragic what happens now. Now recapitalizing Ukrainian operation, again, it depends on the environment. We would obviously not like to do that, but there can be a situation where you want to do it. If there's a tremendous growth opportunity and the situation is clear and the status of Ukraine is clear and there's full kind of international support for Ukraine in that situation, and then we see a large growth potential and value creation potential, then we -- then I'm -- it can be a situation where we would be quite happy to actually increase or recapitalize. But there can be other situations where it's just obvious that we not trade, but [ destroy value ]. But the situation is nothing like that. I mean, again, our bank is very liquid. Actually, liquidity improves. Capital, it's very well capitalized. So the local capital common equity Tier 1 ratio is, if we include last year profits, it's like 17%, 18%. So there's no -- I mean there's no indication that capital would be needed or liquidity would be needed now. Likewise, in Russia, again, our -- we have -- we don't have any -- we don't have a single client on the sanction list. We provide core business, like 80% of the loan book is just kind of subprime consumer loans. We don't do mortgages. We do it in local currency. And then we have a kind of smaller corporate business and an even smaller treasury. Even in harsh and difficult economic environment, this is usually a sustainable business. And we have seen difficult environments in both of these countries, right? And we continue to operate. And in case of -- like in Ukraine, in Russia, again, we don't see any reason to be concerned about potential capital needs or liquidity needs because, as I just said, I mean, the -- basically 1/3 of the balance sheet in Russia is equity. And we used to have excessive -- like the risk rate for our POS loans used to be 388%. It was reduced to 191%, but it's still kind of twice as much as we have in Europe, usually, or the standard rate. And the cash flows, it used to be 338% was brought down to 310% risk-weighted -- risk weight. So this -- and just this change released RUB 8 billion, I mean, RUB 7.5 billion equivalent of capital in the entity access capital. So it's very difficult to see a scenario where we actually have to increase in the foreseeable future, capital or liquidity. Liquidity is improving. Again, we have deposits coming in. So it's kind of hard to answer this question because short term, we -- there doesn't seem to be any need to put their capital or liquidity. And I don't quite understand how, again, short term this would manifest. And if things start to kind of better or improve and this agreement and settlement and there's a bright future, and then we have to put the capital because we are growing and we believe in the future, and then I think that can happen. But if we had to put in capital, let's say, because all of a sudden Russian regulator will decide to kind of double our capital requirements in order to kind of force us to increase capital despite the fact that there doesn't seem to be any need for capital increase, that would be a different situation, right? Then we would understand it is a very hostile environment. So far, I mean, to be objective, we have been -- at least by the Central Bank and authorities in Russia, we have been treated fairly. So we don't see any kind of negative discrimination compared to locally-owned banks. And yes. So I guess that's as much as I can say about this. M&A strategy, we have signed commitments to buy the Slovenian bank and the Albanian bank. So we are going to proceed on our contractual agreement subject to regulatory approval, which we are still waiting for. So these 2 are still likely to happen during the second quarter. Actually, Albania is interesting because they don't need any energy. They have this -- the hydropower generated, and they seem to be -- so that's the country which seem to be, as much as possible, isolated from this situation in Ukraine and Russia. Slovenia, not too much exposure. Uzbekistan, honestly, we haven't thought about that last 2 weeks. This was not -- again, Uzbekistan, there's no agreement yet. We continue discussions, negotiations, but I mean in the last 10 days, this was not highest on our priority list to think about this. So I don't have an answer to that. But there's no commitment whatsoever there.

Okay. This has been very helpful. If I could just have one more follow-up related to capital in Russia. You mentioned that one hypothetical scenario where you would not be committed to recapitalize would be a regulatory imposed one should risk rates double or increase significantly. What about the situation then loan losses increase very significantly and then perhaps that would eat into -- start eating into capital. What would be your thinking in that scenario?

Now we would have to make a decision. And that decision will be based on the future potential of the business and the amount which have to be committed and the environment in which locally and internationally, the Russian banking sector operates.

The next question is Hai Thanh Le Phuong, Concorde Securities.

Just a couple of questions from my side. The first one would be on a happier topic. I was wondering if you could repeat your Hungarian interest rate sensitivity now and I am curious whether it changed compared to your last call. Or is it the same considering the higher levels of you are now? And also, if you could tell us your expectation on Hungarian loan growth for this year, obviously, assuming no material harm stemming from Ukraine and Russia. And my second question would be on -- I think you mentioned during your press conference that you may be interested in Sberbank assets. And I was wondering if this is only true for Hungary? Or would you consider other operations in the region as well? And my third one, if you could repeat your Russian bond exposure, that would be helpful because I wasn't following.

So the interest rate sensitivity or our earnings sensitivity to the rate environment, now that actually the BUBOR is about 5 and the 2 weeks deposit rate is about 5, the best guess that it's close to 0. So we don't expect further gains from further increases because deposit prices will start growing as well. In terms of loan dynamics in Hungary. We shared with you this kind of 10% group average. And in our -- without Russia and Ukraine, in our kind of initial or original budget for this year, Hungary was somewhat higher, so kind of low teens. Again, it's likely that the events are a negative impact on the potential loan growth. But I would be hopeful that we still can do at least 10%. Sberbank is gone. It went into default into administration. I think it was today or 2 days ago. So they are bankrupt, and the -- in Hungary, the deposit insurance fund is going to pay to depositors. Typically -- it was a kind of retail and SME bank. So I think a large share of the deposits will be compensated and paid from the deposit insurance fund. So it's over now here. And I think they were -- I think in Croatia, they were bought by -- I don't know, but all of their assets were either sold or discontinued. In fact, this was, at least the Hungarian event, was triggered by the liquidation of the Austrian holding company. So that kind of -- that triggered at least the collapse of the Hungarian entity because the Hungarian entity had its liquidity in the Austrian holding company, which is also a bank -- used to be a bank, and that went under administration first and they didn't pay back the deposits. So that triggered a large capital loss in Sberbank Hungary and they went default. It's a small entity, it's like 1%. Still obviously painful and it didn't come in the kind of right time, but it's over now.

Okay. And on your Russian bond exposure, again, in total?

Bond exposure, sorry. Yes, it was 88 -- outside Russia, we have -- I mean this is kind of year-end exchange rates, so HUF 88 billion equivalent in our Hungarian books and HUF 13 billion equivalent in our Hungarian books. And we have some in Russia as well, but it's in the Russian banks, all right?

The next question is from Gabor Kemeny, Autonomous Research.

One other question on Ukraine. Can you remind us if there are any credit and capital forbearance measures in place in Ukraine? And if there are, do these Ukrainian and the Russian forbearance measures you mentioned, do these impact your group consolidated financials? Or are these just relevant for the local entity? And then the other thing is on the -- just on the crisis again. Can you comment on the refugee situation? I mean we see broadcasts. We hear anecdotes about many refugees arriving to Hungary and some neighboring countries. I wondered how this may impact the economic environment and the business environment for OTP. Yes. And just finally on -- a bit technical one on NII. You may have mentioned this, but an impressive growth in Hungary in Q4. And I think you are flagging that half of this came from a swap result. So was this a one-off actually?

So in Ukraine, the February loan repayments and interest payments they --- were kind of delayed to March. So in a way, it's an overall moratorium service side on every credit. I don't know how long it's going to be the case, but so far it's just 1 month. In Russia, I'm not aware -- I mean the only thing I'm aware of is kind of system-wise, is that they put a 3 years moratorium on foreclosures, but we virtually don't have any mortgages. So it does not apply to us, but it applies to those banks who have mortgages. I'm not aware of any policies regarding kind of restructuring, kind of policy level restructuring in insurance, so we have not applied any. In Russia, life seem to go on, right? So the sanctions so far have had a very immediate and direct impact on the financial intermediary sector, right? So stock exchange, central bank, clearing house, basically treasury, special money market instruments, but so far, the kind of real economy impact is, at least from our perspective, related to our client service side, especially our retail, again, fundamental retail bank, our retail clients have not experienced any shock because we are -- I mean the exchange rate -- I mean our loans are in local currency. And in fact, now that the base rate is like 20% and the -- and typically, the kind of better clients have lower than 20% consumer loan rates. They seem to be -- I mean we don't see worsening to -- in delinquencies or collection as usual. Yesterday, we looked at the kind of daily collection numbers and portfolio quality numbers, and so far we haven't seen any deterioration in the Russian business. In terms of NII, fourth quarter, yes, I tried to -- maybe I wasn't clear enough. So in Hungary, we had this -- we had -- we kind of closed some of the ALM positions and swaps, and they had an impact -- a small positive impact, but it was -- the accounting was in a kind of gross way. So we had a positive NII and a negative in other income. So if you look at -- the magnitude is roughly HUF 7 billion. So -- and this is a one-off. But if you net the 2, then it's somewhat positive, a few hundred million positive, right? So you should look both NII and other income in Hungary, fourth quarter, you can see NII went up. Half of that increase was due to this transaction. And then you see a drop in other income and most of the drop was -- like HUF 6 billion was related to this. And if you net the 2 out, it's less than HUF 1 billion gain on that. So that's -- it's clearer now. And it was a one-off. But again, it creates a somewhat bigger movement in these 2 lines. But if you kind of net the 2 together it's somewhat positive, but a rather small number. Refugee situation, we have more than -- already more than 100,000 refugees from Ukraine who entered the country and roughly 20,000 per day. There's a very strong effort and a lot of activity going on to try to help these people and this is done by the government, this is done by NGOs and this is done by just individuals. So, I mean, I think we have 2 families in our -- which will kind of -- my -- I mean, personally, we accommodated 2 Ukrainian families. Typically, families mean a mother and kids because men are not allowed to -- so between age of, I don't know, so 18 and less than 60, so the kind of military age, they are not allowed to leave the country. So we typically have women and children coming. And a lot of people are trying to help and a lot of people are actually going to the border and -- because one problem is that they don't have transportation. So it's basically housing and transportation. These are the first 2 immediate needs. What they have is a -- I think there's a kind of broad response from the society and from the government to do as much as we can. And as far as we understand, most of these people don't intend -- they don't intend to stay, right? They either want to go further west or obviously, they would love to return because, typically, these are, again, not full families, but -- so -- and I don't know what the implications will be. So honestly, I think it's -- I mean what we, again, focus on is trying to provide as much help as possible. So the bank itself -- I mean whatever we -- I mean we are providing housing for the refugees and putting together a package -- a financial support package to try to help them. So that's our focus at the moment. In a way, obviously, we -- there are Hungarian-speaking people living in Ukraine and I think a big share of those who so far entered the country are coming from that part of Ukraine, the Western part immediately bordering Hungary. So for them, it's much more easier to work in the country or to actually settle if they wanted to. For those who don't speak Hungarian, obviously, it's not a very easy kind of language for a kind of long term. But if -- I mean they are more than welcome, I think, given the -- from a kind of practical business point of view, one of the biggest problems, structurally of Hungary is demographics and decreasing demographics. So if the kind of skilled labor increases, it's potentially positive. But this is, I think, a side issue or a side consideration, and certainly, that's not what we are thinking about now. We are thinking about how much we can help as organizations and as individuals. Again, most of the people I know either helped or actually accommodated people, refugees from Ukraine at the moment.

That's a very commendable support effort.

The next question is from an attendee joined via phone. [Operator Instructions]

Hello. It's Andrzej Nowaczek of HSBC. Laszlo, what would you say the difference is between the 2014-2015 situation in Russia and Ukraine and the current situation could be in terms of impact on OTP financial? I mean, I guess, more likely to be more severe now than then, right, but possibly also a bigger impact of the Russian business than 8 years ago. I wonder whether you agree.

Certainly. I mean, again, it depends what the outcome is going to be. Certainly, the magnitude of damage so far has been higher, much higher than -- physical damage, I mean, in Ukraine than in '14, '15. Then, it was very kind of local in a way or contained in certain parts of the country. So if you expect or if you assume a negative scenario that this is going to continue and there's no resolution, which is kind of globally accepted by all the parties involved and not involved, then obviously, this is going to have a much bigger effect and the kind of longer-term effect. And again, we try to present the potential financial implication of a scenario like that. On the other hand, if this is -- in a way, this is how this situation is going to be resolved, which has been there unresolved now for 8 years, and still, I think there's a chance for everything to turn for better. And let's say there's a ceasefire tomorrow, and then the parties agree and then a peaceful resolution is achieved and Ukraine can continue to grow and all parts of Ukraine -- which are -- I mean or kind of -- how to say -- so every territory involved will have a legal status acknowledged and accepted internationally, it can -- it could create a much better growth platform for the country or the countries involved. I don't know how remote that option or possibility is given the current situation. But if you believe in that scenario like that, then it could even improve, right? And then the outcome should be not as bad as it was in '14, '15. But again, I don't know how much we hope we can put into that scenario. What happened so far is much worse obviously. I mean the magnitude of -- the scale of the war is uncomparably bigger than what was happening in '14. And then also the sanctions on Russia are more -- a couple of magnitudes bigger than they were -- or rather, which were introduced in '14, '15. So in that sense, this is certainly a worse situation.

[Operator Instructions] The next question is from an attendee who joined via phone. [Operator Instructions]

Hello. This is Robert Brzoza from PKO BP Securities. Can you hear me?

Yes. Loud and clear.

Great. It's on the cost of risk guidance that you had given for '21, of course, without considering Russia and Ukraine. You expect more or less the same cost of risk in '22 as in '21. And here goes my question, because to my understanding, if '21 was burdened with a one-off related to the extension of moratoria which I would be expecting to reverse at some point once the moratoria expires, so does it imply that taking this into consideration, you actually expect on the remaining portfolio, some deterioration in the provisioning outlook? And secondly, if you could comment very briefly on the leasing subsidiary in Hungary, where you were making, I think, NPL sales, et cetera, which was also on Hungary factoring unit where we've seen in the past, a positive contribution to the cost of risk because as I understand from the report, this has changed regarding 2022 outlook.

I mean risk was straight last year, it was 30 basis points. And if you take out Russia and Ukraine, it was 19. Similar levels at 19 basis points. I don't think this is like kind of high, even plus and minus the [ term ] on the moratorium-related provisioning because, indeed, that's the case. So we had to provision extra fourth quarter for those loans who exited, who kind of remained in the moratorium after the last extension because there the client -- those clients, actually, they declared that they had payment problems. So we had to worsen the stage buckets they were in and that created the one-off provisioning. And we, in fact, expect the opposite in the second quarter this year, where we hopefully will be able to take out clients who can participate in [indiscernible] the moratorium and who pay regularly for 6 months. We will reclassify them to Stage 1 and we'll certainly use a one-off release. So that's one technical impact, which we expect. And the other one is what you referred to that, at the end of last year, we made another revaluation of the book value of the portfolio, which we have at Factoring, which is a [ work out unit ], and we -- we had to do a one-off kind of release, provision release and increase the book value of these loans in accordance with the methodology expected by our auditor -- new auditor. But now the consensus is that it is more or less where it should be, definitely these one-offs are not expected. We still expect positive risk costs coming from these portfolios, but not in a way of one-offs. So there won't be any more kind of year-end one-off on that line. Now having said that, I think this is kind of similar to last year, which means, in this case, without Russia and Ukraine, something slightly less than 20 basis points. I think it's rather optimistic. And again, I mean, to be frank, we have not -- I mean, again, the last -- I mean the work started last week, right? And since then, we haven't made a new budget, to be honest, and it's something -- I mean we focus on other kind of operational pressing issues. So this -- kind of similar to last year, if you kind of read the way how we phrase it was that assuming that the conflict doesn't exert a material negative effect on the rest of the group. If you believe that this is the case, then I think it's fair to assume that we are going to have kind of 19, 20 basis points risk cost for the rest of the group. And then it depends on your view, how much negative ramification rest of Europe, not just the countries where we operate, but the rest of Europe that actually undergo or suffer due to this special situation, what we have. And I try to -- I don't think it's going to be 0. I think it's already clear that it's going to be negative, very obvious one is higher energy prices and higher food prices and higher inflation. And so I think it's fair to assume that at the end, we will have somewhat higher than 20 basis point risk cost for the rest of the group because, obviously, the economic environment is less favorable than risk cost. It should be somewhat higher. So don't take this guidance as a -- so these lines and these statements, which stand here as guiding information, they are based on an assumption which we don't know to which extent holds, right? And if -- I think we will have to wait to be realistic. I mean we could say -- we could tell that, I mean, it's going to be X and Z and Y, but I don't think it would be very responsible to do that. I'm probably -- once we know the type of resolution to the situation in Ukraine, and the -- once we know the parameters of operation for us for the rest of the year or kind of even longer, then we will be able to make probably better assumptions and forecast and how it's going to have an impact on our numbers, right?

The next question is from Siva Natarajan.

This is Siva Natarajan from GW&K Investments. So thanks for your candid views on everything. Just a follow-up on exposures. What are you seeing in terms of risks in the interbank markets in the countries that you operate in? And two, can you talk about your exposures in the derivative market like swaps, both direct and indirect to Ukraine and Russia?

In Ukraine -- there are no swaps in Ukraine, right? This for -- since 2009, they just don't exist. In Russia, we have local -- we have a local money market book -- treasury book, which kind of requires roughly USD 200 million equivalent of position. As of today, right, this is declining fast, obviously, but -- and we have to finance that position, but this is done locally, 100% locally. So we don't have any -- we already closed the counterparty swap relationships with Russia. What we do have still is this kind of line of funding, which is going to -- not to the bank actually, but to the -- and that's just loan, which goes to the -- this SPV from which we issued the high NPV, high APR loans. And this SPV is owned by the group. So it's not owned by the Russian bank. And we have less than $40 million subordinated loan to the bank.

And what are you seeing in terms of the interbank funding in the different countries? Any risks developing there? I mean I know you said Sberbank Hungary went bankrupt. Are there any impacts because of that? Not just that, but are you seeing risks develop because of potential further bankruptcies?

No, we have not had exposure to Sberbank Hungary or other Sberbank entities. I think it's very specific and given the situation, I'm not surprised that the -- given that Sberbank, I mean, listing was discontinued, I think, yesterday. But before, it was discontinued, the GDRs, Sberbank GDRs in the London Stock Exchange were kind of 0.10 or something like that, right? So -- and if -- I mean it's got -- I don't think it's a surprise that the subsidiary of an entity, which is in that situation troubles, I think the way it was resolved [indiscernible] that's -- I'm not sure. I mean, obviously, I'm only the kind of -- well, I don't know because this is the resolution Board and the local resolution Board we conducted. The solution for the Sberbank group, international group, and I don't know how much coordination was done there and how much consideration was done given the countries, which were involved. From my perspective, I don't see much coordination mostly. And I said -- as I said, the kind of trigger was the case of the Hungarian entity was actually that the Austrian entity was discontinued and therefore -- no, I don't see any other banking group or local bank having similar type of problem. We don't have any other -- as far as I know, the Russian and kind of commercial banking activity in the countries where we operate. And I'm not sure about Western Europe. But certainly, in the countries where we operate, Sberbank was the only Russian-owned active commercial bank. In the meantime, my colleagues tell me that we did have some exposure, which is under -- to the local one, but it's a low single-digit million euro figure. So it's not a big one. And then it's under settlement now with the local Sberbank. So I think this is an isolated event with Sberbank International. I'm not sure it was managed perfectly. But I guess the reason was that it is not system -- probably it wasn't systemic in any of the countries where it operated. And therefore, essentially less regulatory or kind of resolution focus was provided. And I don't see any other financial institution or bank having similar type of challenges at the moment. So I hope it's not going to cause further events. At least I don't see anything in the countries where we operate.

[Operator Instructions] The next question is from an attendee who joined via phone. [Operator Instructions]

It's Jovan from Raiffeisen. Can you hear me?

Yes, I can hear you very well.

Perfect. Good. Great. Just one follow-up. If you could please repeat the exposure to corporates which are doing business to some extent with Russia. I think you mentioned the number earlier, but I somehow missed it, please. On the group level. And the second...

Okay.

And the second one, if I may, on Slovenia, on this introduction of this controversial Swiss franc law. I think Nova Credit already announced some negative effect, but what would be, let's say, joint effect, including your current operations? And of course, maybe with this, is there any chance maybe to adjust the pricing for Nova Credit now because of that?

Okay. So exposure, I said, was around EUR 500 million. Kind of that's across the group. And that this is the exposure to clients where the substantial relationship primary to 90%, 95%, it's Russian, either exporting to Russia or sourcing from Russia. But...

Is it however maybe more for -- okay.

Sorry?

Is it maybe like higher allocation, I don't know, in Bulgaria or Serbia compared to other group members, right?

It's kind of evenly distributed. Yes, Serbia, yes, to some extent. But it's everywhere. And we don't consider them kind of high risk exposures, right? So we -- it doesn't mean that we are going -- that all of these loans will have serious issues. It's just that, that's the exposure to clients we have, exposure to Russia. But -- or kind of strong exposure to Russia. It's not tremendously concentrated anywhere, right? It's across the board. Again, as I said, it's surprisingly -- it's quite surprised -- and now that we look deep into the numbers, typically, again, in terms of exports, it's between 1% and 3%, which is to Russia and Ukraine, to these countries. Now 2 exceptions, Moldova and Montenegro, interesting. Montenegro, it's almost 8%, 9%. They export pharmaceuticals to Russia. And they have a lot of like 25% of the tourists -- incoming tourists are from Russia and Ukraine. I'm not sure whether that number is going to go up or down or kind of permanent residents or they will switch to being permanent residents, that I don't know. So I don't know if it's good or bad. But these are the 2 countries, and Moldova, obviously to Ukraine, Moldova and also kind of Russian gas dependence. I mean they already -- I mean they're -- the Russians increased there over the winter last year, the cost of gas, 2.5x, so they already have problems. In terms of this track exposure, NKBM, which is still -- I mean, we are very much on, so likely have not closed the deal, and we are considered competitors. And we are competitors still. So we only know what they have publicly announced, and they announced roughly between EUR 45 million and EUR 50 million one-off loss coming from the Swiss franc problem. Ours is much less, less than half based on our current estimate. As far as I know, there's no contractual opportunity to reflect this in the price of the asset.

[Operator Instructions] As there are no further questions, I hand back to the speaker.

Okay. Thank you again for joining us today. Thank you for the very good questions you had. I'm sorry that I could not necessarily answer everything with a level of detail. But honestly, the situation is so fluid and difficult to foresee what exactly the settlement and the situation will be that I think we have to wait somewhat to see how exactly it's going to -- plays out. But certainly, we'll -- we are doing our best to help wherever we can help and to maintain the operations as much as we can. So I wish you all the best, good health and, hopefully, see you or have you on the conf call, which we are going to do in early May. And then we are going to have -- in between, we are going to have the AGM on the 13th of April. So very much hopeful that most of you who are representative of investors here will come and vote on the AGM. And until then, thank you again, and goodbye.

Thank you for your participation. The fourth quarter and full year 2021 conference call is closed now.