ProCredit Holding AG (PCZ) Earnings Call Transcript & Summary

And welcome to our Second Capital Markets Day. My name is Nadine Frerot. I'm heading up the Investor Relations team at ProCredit Holding, and I will lead you through today's afternoon. For our second Capital Markets Day, I'm joined by the management team of ProCredit Holding; Hubert Spechtenhauser, the Management Board -- Chairman of the Management Board; and the other Management Board member, Eriola Bibolli; Christian Dagrosa; and Gian Marco Felice. They will take you through the first block of today's event, the update of the group business strategy. We'll provide time for question and answers after the presentation. We'll continue after the break with the roundtable with our colleagues, Amina Dorma, Management Board member of ProCredit Banks Bosnia & Herzegovina; Visar Pacarada, General Manager of ProCredit Banks Kosovo; and Victor Ponomarenko, General Manager of ProCredit Bank Ukraine. They will describe the special role for Credit plays in their local markets and what the updated group business strategy means for their specific context of their banks and markets. Before we start, I would like to also provide you with the usual warnings to pay particular attention to the cautionary statements at the end of the presentation regarding forward-looking comments. Please bear in mind as well that we are recording today's event, and that the recording will be made available on our website after the event. I will now give the floor to Hubert for some introductory remarks before we start with the presentation.

Thank you, Nadine. Good afternoon. Ladies and gentlemen, welcome to our second Capital Markets Day on this sunny beautiful day in Frankfurt on the March afternoon. Totally unexpected here in Frankfurt to have such nice weather on March date. We are very happy about your attendance, both virtual and a few attendance here in-person, and we are very happy that so many of you take your time and that you spend the afternoon with us, giving us the opportunity to explain to you our future strategy and also the targets and ambitions, which we define for 2024 and the years thereafter. I'm joined today in the presentation with my -- by my colleagues on the Management Board, as Nadine already said. And before starting with the presentation, I would like to introduce also a new member of the Management Board, starting from April 1, we will expand the management board by 2 additional members. One of them is present here, Christoph Beeck. Christoph Beeck will join us, as I said, on April 1. He is already managing the ProCredit Bank here in Germany. And we are very happy that you will become part of the management team of the holding starting April 1. There is a second new nomination, which we communicated last week, George Chatzis, another new colleague who will come and also join us on April 1. He will, over time, take over responsibility for risk, and he has been working for different international banking groups. He's a Greek and Dutch National and lives here in Frankfurt and will join, as I said, also on April 1. So let me start with today's presentation. Maybe before going into what future oriented, let me just briefly touch upon the past. And if I say past, I don't mean the very distant past, but rather the recent past or to be more precise yesterday. Yesterday, we presented our financial year 2023 results. And in the afternoon, Christian and I had our usual analyst call. And I just would like to remind you that 2023 was the most successful year for ProCredit Group ever had. And if I say ever had, that does not mean since listing, but that means since inception. We reported a profit of EUR 113 million, which equates to a return on equity of 12.2%, which is roughly in line with our updated guidance for the year 2023. We also improved in this context, our cost/income ratio to a level of 59.9%, and we come from a level of more than 70% only a couple of years ago. And we also managed to structurally increase the resilience and the strength of our balance sheet. As you might have seen, we collected approximately EUR 1 billion in new deposits last year. That's an enormous amount for us that equates to 15% and really strengthens our balance sheet. We also strengthened our capital ratio. We have -- at the end of the year, we show a CET1 ratio of 14.3%, which is up 80 basis points roughly compared to the year before. And we show at the end of last year, a capital buffer at the level of the CET1 ratio of approximately 500 basis points. So all in all, that was a very successful year for the group, but also for the individual banks. Actually all of our banks in Southeastern and Eastern Europe contributed to this positive result. And we also met last year our impact targets. We also published yesterday our Impact Report, and I very much encourage you to have [Technical Difficulty] we made progress in our impact targets, both on the environmental front, but also in all the other aspects. And last but not least, I would like to mention that the legal form into a regular AG, i.e., a joint stock corporation under German [ word ]. So just to mention that whatever we tell you today is on the basis and on the foundation of a very, very successful year 2023. Now let's start with the future. And I'll start with a brief strategic update and my colleagues then will provide way more details on the individual aspects. Let me start with what's new. And on the basis of the very successful year 2023, we started to discuss with all of our banks in the course of the second half of last year, how to improve our performance going forward. And in essence, we concluded that we would like to broaden our footprint in our markets of operation, and to enhance the positive impact we have as a banking group on our markets of operation. And actually, all the discussions which we had internally, and we have aligned it, as I said, with all managers of our affiliates, but also with our Supervisory Board in the last couple of weeks centered around 3 elements: positioning, growth and profitability. And if we talk about positioning, that's particularly important to us because as many of you know, we always said that what makes us specific is that we want to combine a positive impact on the economic, environmental and social development of our countries of operation with an adequate profit for our investors. And I go into that on the next slide because we have tried to broaden and to sharpen our impact definition to capture that broad definition of impact and also to be able to properly report it. Secondly, we decided that we would want to position ProCredit as a Universal Bank for MSME and PI clients. We are currently very much focused on SME, and we want to broaden that to a certain extent and that does, in particular, require a much stronger positioning of our group in the area of private clients and to position ourselves as an attractive bank for retail clients. Second element is growth. Number one, we want to attain critical mass in all of our markets of operation. And in some countries, we are still not there yet. To get there in all of our markets and to strengthen our market position further in the markets where we already have a very strong SME position, we want to substantially increase the number of our client base. We want to increase the number of our SME clients by at least 50%, and of our private individual clients by at least 150%. And we also aim to grow our balance sheet and our loan portfolio substantially. We aim for a loan portfolio north of EUR 10 million. We are currently at EUR 6.2 billion, which means that we aim for a 60% growth in the medium term. And we also want in this context to change the composition of the balance sheet and that comes under profitability. We have already improved the structure of the balance sheet last year and the year before. And we have moved to a more granular basis on both the asset and the liability side. And we want to expand further on that. And to do so, we want to make targeted investments in 4 areas: in staff, in IT, in marketing and very selectively in our branch network. Eriola will cover that in more detail later on. That will allow us to have a better operational leverage and to exploit scaling effects more effectively and we are convinced that, that will lead to an enhanced medium-term return in the region of 13% to 14%. As I mentioned before, we had a medium-term target of 12% up until now. We reached that last year with 12.2%. And we are very confident that we can increase that further. Now coming back to the issue of positioning. As you know, we have always put high emphasis on our specific reason to exist our Eurozone data. Why we have ProCredit Group in the first place. And in the first place, ProCredit Group was not created to make profit alone. It was created to have a positive impact on the economic, social and environmental development of our countries, and to do that in a way that it provides attractive returns for our investors. We always aim to strike the right balance between this impact and this commercial orientation. And this impact orientation is very broadly defined as I said, environment, economic, social development. And it entails many aspects and whoever has taken the time to read our Impact Report saw that reflected properly and comprehensively in our Impact Report. Though having said that, we ultimately in our guidance, reduced it to one single metric, which was the proportion of green loans in our overall loan portfolio. And that only to a limited extent captures the overall sense of our impact orientation. And therefore, what we decided is we would like to link our definition and our measurement and also our target setting with regards to impact to 5 sustainable development goals and ultimately define KPIs, which capture more comprehensively our impact. With regards to job creation, with regards to investments, which we are allowed to happen, with regards to our impact on gender equity, but also if you look at the environmental side, our path to net zero. And obviously, we will also keep the KPI regarding our green lending. So we want to capture report and define our impact orientation more broadly and more comprehensively. The second issue, which is important for us, is obviously our focus on Southeast and Eastern Europe. More than 90% of our assets are in that region with the banks in Southeastern and Eastern Europe. And in our view, it is the right place for us to be and to focus very strongly on this region. Reason being that this reason is important and attractive from an economic impact and political point of view. If you look at the economic component, these countries, our countries of operation do show growth rates in their GDP, which are at least 2x as high as in Western Europe or in the Eurozone. Also, the penetration of this banking services is way lower than in Western Europe. This allows for higher growth. It allows for higher margin. And as long as we manage as we did for the last 20 years, to do successful business in these countries of operation with substantially lower cost of risk than the market average, this is very attractive as a region from an economic point of view. It also is extremely attractive from an impact point of view because there is no other place in Europe where we could have an even remotely comparable impact on the positive social, economic and environmental development of a country than in this region of Europe. And thirdly, also from a political point of view, be remind that 8 of our countries of operation have EU candidacy status, including [indiscernible] which is an applicant. This means that also from a geopolitical point of view, this region of Europe is decisive for the future peaceful development of our continent. Where we see a change is in the composition of our client base, not a dramatic change, but a certain degree of shift of emphasis. What we show on this slide is actually our current focus in -- on client groups. And what you see is that we define client groups in essence, by client exposure and that we define small clients, different exposure of up to 50,000, and then small clients up to 500 and anything north of 500, we call medium clients. The small and medium clients account for 88% of our loan portfolio. So that has been clearly our focus, and we have positioned us very successfully with these clients with a Hausbank concept. Hausbank concept is a very German word. What it does mean is that we want to capture as much of the share of wallet of a client as possible, i.e., if we bank with a -- let's say, business client, we would expect the client to work with us as the predominant, if not the only banking partner having with us not only the deposit at the loans, but also the deposits into transactions. And we have shown that in this segment, we were successfully growing by EUR 2 billion within 4 years, in the 4 years preceding the war of aggression against Ukraine. So in this segment, we have a very successful positioning of all of our banks. What we have not been targeting so much was the smaller segment called Micro or in our internal wording used to be called very small and also not so much on private individuals where we had a fairly selective approach, targeting predominantly business owners and salary receivers with an above average salary. So only 10% of our loans went to private individuals, 2% to very small clients and 88% to the core segment of SME clients. Now there is, to a certain degree, a shift of emphasis. Shift of emphasis obviously does not mean that we changed it completely. Number one, we have decided to increase their thresholds. Very small is now defined an exposure of up to 100,000, small with up to 750,000 and medium north of 750,000. That does reflect to a certain degree, inflationary changes, but also that we would on purpose, define clients a little bit with higher client exposures. Secondly, we want to continue to expand in our core market of SMEs. We want to continue to implement the successful concept of being a Hausbank that has proven to work well for both us and our clients. Though having said that, we would like to focus a little bit more on the smaller part of this business because it allows for higher margins. It is more attractive from a capital perspective, and it allows for more growth. And to capture this growth, we also consider expanding in some regions, the branch network. As you know, we have reduced our branch network dramatically. If we look at the banks which we have from approximately 650 branches to 40, 45 and we are now contemplating to expand that a little by another 10 to 15 branches, which is not much in the bigger scheme, but allows us to grow more trendy in the SME business. Where we would want to put my emphasis on is the very small segment, where we can expand that basically our offering, in particular, the digitalized offering, which we have should very much -- be very much appealing to this client group. And secondly, we want to broaden our approach to retail being less restrictive and to position ourselves as a universal bank also for private individual customers. Please bear in mind that in particular on the deposit side, we have already been doing this last year and the year before last year. As I mentioned before, only last year, we increased our deposit base by more -- by roughly EUR 1 billion, half of it coming from private individuals. So it is concept, which we are already implementing and that applies to a big part of what I'm telling you that, indeed, if you look carefully at our numbers for 2023, much of what you see here -- for much of what we see here, the groundwork has already been laid in 2022 and in 2023. So what are we aiming for? Over the medium term, we want to become the leading bank for MM -- for micro, small and medium enterprises in Southeastern and Eastern Europe as a region. To do so, we have to attain critical size in every single market in which we operate. And Christian will touch upon that later on in his part of the presentation. And we also have to position ourselves as an attractive bank for private individuals. Eriola will touch upon that also. To do so, we will have to make strategic investments, as I said, in people, in marketing, in IT and very selectively also in our branch network. Also on that count, we have already started last year. We made substantial investments for increased investment in people, marketing and IT. We want to grow our client base, as I said, very strongly, at least 50% in SME, at least 150% with private individuals. And ultimately, we want to get to a loan portfolio of north of EUR 10 million. And in particular, we want also to transform our balance sheet to make it more granular on both sides of the equation, i.e., on assets and on liabilities. Having said that, we increased, and we communicated that already a week ago. Our medium-term return on equity outlook from 12% to 13% to 14%, and we are very confident that we can reach this increased profitability level. What's the drivers behind that is to scale the business and to change the balance sheet composition. We want to support net interest margins by a more -- a higher degree of granularity on both sides of the balance sheet. We did so already last year. And what we have seen, if you looked at the data which we published yesterday on net interest margin, we have been expanding our net interest margin by 10 basis points quarter-after-quarter. In particular, now when we expect the overall interest rate environment to decrease, it is of utmost importance that we support these margins by having a more granular approach and in particular, by having a bigger contribution of retail clients to the refinancing side. We also want, as I said, expand our client base, which will help us to support the noninterest income. We will keep a continued strong focus on cost efficiency. The strategic investments are focused on 2024 and 2025. The underlying cost efficiency is supposed to remain very high. We decreased, as I said, our cost income ratio from more than 70% only a couple of years ago to 59.9% last year. We would envision it to increase a little to roughly 63% this year due to these investments, but then in the end, over the medium term to get down to something like 57%. Very important also to understand what are our assumptions regarding ProCredit Bank Ukraine. And Victor will touch upon that later on very explicitly in the roundtable. Our bank in Ukraine is fully operational, and it has been fully operational throughout the war of Russia against Ukraine. And it is by now also ring-fenced. And in our base case, we only assume a moderate contribution of our bank in Ukraine to our overall profitability. We assume something in the upper single digit, lower double-digit million profit contribution. In case the situation, we are at some moment in time to stabilize in Ukraine, we're very confident that our bank in Ukraine would provide a fantastic platform for further growth. And we would assume that the upside potential of such a stabilization should add something in the region of 1% to 2% to the group level of return on equity. So the 13% to 14% do not yet include a potential upside coming from a stabilization in Ukraine. So cut along -- so to cut the long story short, this is not a revolution, but it is, in my view, a very ambitious evolution of our business model. And in this time, on the basis of a very successful, I would say, excellent performance in 2023. What is it all about? It's about a broadened and sharper impact definition, which remains to be the guiding principle for us. It's about positioning us and transforming us into a Universal Bank for MSME and for private individuals, which does require a more prominent positioning of our banks as attractive banks for retail clients. It is combined with a growing balance sheet and with a changed balance sheet composition. It's about more in size and more in granularity, and there we aim at the deposit loan ratio in all of our banks of approximately 120%. On this count, I might have mentioned it before or not, we increased deposit to loan ratio already dramatically in 2022 and in 2023. And by now, we have at the group level, a deposit to loan ratio of 116%. And we are very confident that this will allow us to substantially increase absolute profit, but also the return on equity to this level, which I mentioned, 13% to 14%, plus a potential upside coming in case of a stabilization of the situation in Ukraine in the region of 1% to 2%. So having said this, I would now hand over to my colleague, Gian Marco, who would explain more in detail the impact component of this transformation. Thank you.

Thank you very Hubert. If you can hear me, yes. Good afternoon from my side as well. My name is Gian Marco. I'm responsible in the group for business development, technology and impact and today, it is about Impact that I want to discuss and present to you. Responsible banking has a long and rich history in ProCredit. Social and economic development as well as environmental protection was core to our business model even before the term ESG was coined at the beginning of the century. The group was founded to support entrepreneurs. We believe that is in the private sector that we can find growth jobs, opportunities and a better quality of life for the societies in which we operate. And therefore, we support the SME sector, which is the backbone of the private sector, particularly in our countries of operations. But for those of us who have been working for a long time in emerging economies, we also know that there is a positive correlation between environmental degradation and poverty. And hence, it was for the utmost importance for us from the very early stage to pay particular attention to the impact the social and economic development has on the environment. Testimony to that is our early action on green finance, which to this day participate 20% to our total loan book. This also shows how we see; we turn challenges into opportunities because the green transformation is not only about protecting the environment, but it's also about creating many opportunities both for our clients as well as for us. What is Impact in ProCredit today. Now sustainability has a broad agenda. There are many topics to be covered. As you know, 17 SDGs and we have a materiality impact that covers 9 of them, as you can find in our Impact Report. But because we want to focus on the most important aspects according to us, listen, where we feel we can have the biggest impact, we focus on 4 main broad areas, 2 in social impact and 2 in environmental impact. Now jobs and investment is our utmost priorities. Indeed, we support around 200 direct or indirect jobs through our financings in our countries of operation, thanks to the financing that we provide to the SME sector. Jobs are important, but good jobs is even more important and good jobs are created if we can enhance productivity if we invest in capital formation. And this you can see here being achieved by the focus we have on long-term investment loans, which participate 64% to the total loan book of the bank. Good jobs, but also fair jobs. Jobs open to everyone, jobs that provide equal opportunities, diversity and inclusion. And hence, we decided that from this year we will put a specific lens on gender finance, and we want to improve and increase the participation of women in the private sectors and in the SME clients that we have in our client base. Currently, around 20% of our SMEs are owned -- majority owned by women, and we intend to increase that further. On the environmental side, there are many priorities from sustainable agriculture to biodiversity, but one major priority looms large, which is the climate crisis. And there, where we plan to focus more and more of our attention. Green energy is already a core part of our business model. We have been developing our green lending portfolio, particularly renewable energy portfolio over the last years. But it's also important that besides avoiding new emissions into the environment, we also decreased the emissions that are being created today, meaning that we have endorsed the net zero journey as agreed in the Paris Agreement in order to accompany our clients to their own net zero journey by 2050 to limit temperature rises to maximum 2 degrees for print industrial periods. I will talk about this more later. Before we do go on and look at the impact we have vis-a-vis our clients, it's also important to look at our own internal action and how we do our utmost to lead the way by example. We established our internal environmental management system in 2015. Since then, we have systematically measured and then brought down our own emissions. Scope 1 and Scope 2 emission. 70% since the moment we started measuring them from 15,000 kilotons per year to the current 4,000. Now it is important that we go further. As you know, and as you actually have been -- as you saw last year and as we will see later on from our colleagues in Kosovo, we also invested in our own power plant in Kosovo for 3 megawatts, in which, thanks to the Gold Standard certificate that we will receive, we will have achieved the carbon neutrality. But carbon neutrality is only a step to the final destination and the final destination is actually bringing down our Scope 1 and Scope 2 emission complete to 0 according to the Paris Agreement. Now we believe that what you do depends on who you are, and therefore, it's essential to our strategy that we build a staff base that believes in our impact, work, store it, identifies with it. Now it's very difficult to summarize culture, identity and values in 1-minute. Therefore, I can only encourage all of you to come and visit us in our training center in the [indiscernible] ProCredit Academy, where you can, even in a few hours, understand better how we discuss, how we live, how we create our quite unique internal corporate culture, which then allows us to focus so much on external impact. But it is about this external impact that I want to talk today, particularly on those -- on that we have vis-a-vis our clients. We have 2 types of clients, broadly speaking, business clients and retail clients. For business clients, as we said before, the SME sector is fundamentally important if we want to really have an impact on the social and economic development of our countries of operation. We approach this offer underserved sector of the economy holistically, as Hubert said, as a Hausbank, not only understanding the financial needs, but also providing very much needed advice in order to meet the challenges of today and tomorrow. For example, the one on decarbonization. Sustainable agriculture, for instance, is a topic that occupies us a lot because 20% of our loan portfolio is in agriculture. Food security is very important, but it's also very important to provide it not at the expense of the planet. We provide not only capital to our farmers in order to modernize and mechanize and introduce technology to produce more food, but also to produce better food by introducing methodologies, by introducing way of cultivating crop and raising animals, which are more sustainable. And in order to do that, we provide the needed advice that they themselves don't have access to. And in this sense, our impact goes beyond adjusted capital that we provide. On the retail side of life, well there, our business model is very, very simple from the one hand, but also very forward looking on the other hand. We bet on technology. We believe that the future of banking is platform-based. And therefore, we have made a significant investment in creating a digital platform, which is proprietary, we develop this fully integrated and allows us to provide efficient, secure and affordable banking to ordinary people. What we use this platform is actually a very ancient tricks that banks have been performing for centuries. We raise -- we raised savings for private individuals who have excess savings, and we channel that to the protective part of the economy. A very simple transformation. But at the end, allows us to really create an environment, where those who have the need to protect their savings and save for the future have the ability to do so very conveniently and those who need to invest for the future have access to it. Also for private individuals, though the green agenda is important. We all need to make an effort to green up the economy and to green up the environment. And therefore, green lending is also a relevant part of what we do vis-a-vis our private individual clients. Energy efficiency loan, heat pumps, PV installation, rooftop installations are only examples of how private individuals can make a good investments that protect the environment, but also creates a better quality of life. Now in the next 2 slides, I want to dive deeper to the topic of climate action. Because indeed, we are facing a climate crisis, and it's important that the financial sector, thanks to the impact that it has on the economy, does it's bit in order to reduce emissions. We have subscribed and we have aligned ourselves to the objective of the Paris Agreement, and therefore, we are now on a net zero path for our Scope 3 emissions. This is very relevant for us, but I think that is also relevant for the development community because we address a very specific sector, the SME sector. The way that you decarbonize the economy is that you go top down, you go to the bigger emitters, the bigger company, the corporate, and they have the means the know-how and the resources to measure their emission, to understand the problem and to act upon it. SME companies often don't have that. They don't even know how much emissions they have. They don't know what they can do in order to reduce them. But if they don't, then 60% to 70% of the economy will not green up. So one can start with the biggest one, is reasonable. It is rational, but one needs eventually to drip down to the rest of the private sector. And that's what we intend to do. That means 3 things: a, you need to measure emission granularly at the individual client level. And that is, again, an exercise of finding the proper balance between precision and efficiency because we are talking about large numbers. We bank currently with 46,000 SME companies. And therefore, we need to collect the data granularly enough, but efficiently enough in order to understand what their remission is at the individual level. Once that is done, what we need to do is to engage with them to make sure that they subscribe themselves to a path of net zero. And this must be done in a way that they see opportunities and not the challenges. Once the entrepreneur is onboard with that journey, then we need to accompany him or her to the end of it. And we do so by creating for us those opportunities, which could also be opportunities for the client in greening up their businesses by so doing also improving their performance, financial and business performance. For instance, by unplugging from the grid and installing PV rooftop installation to generate their own electricity or biogas installations or new machinery and new equipment that can reduce energy intensity and so on and so forth. So we will need to do that with all of our clients by 2040, and our Scope 3 emissions need to come down to zero by 2050. And we do this according to a science-based targeting model, which is now the industry standards for those institutions, which are subscribed to this approach. Bringing down current emission is very, very important, but it's also important not to admit more as we produce energy. Now we have a good starting point in ProCredit because due to our exclusion list, we have -- we basically have no exposure to the fossil fuel industry. What we have, though, is an interesting and growing exposure to the renewable energy industry. Currently, we've financed around 1-gigawatt of installed capacity in our group. The size is meaningful. In must -- much of our countries of operation, our market share in renewable energy varies between 2%, 3% to 10%, 15% of the country stock. So it's not irrelevant. And it is growing because we are one of the few players with the know-how necessary to extend these loans. What is more remarkable is that this 1-gigawatt of installed capacity is spread over numerous hundreds and hundreds of projects. In fact, our impact is not only in the volume, but in the number of projects that we facilitate. We focus on projects in the range between 1 and 10 megawatts, what we call the missing middle, because these type of projects are not usually financed from FDIs or from large operators, which have the know-how and capital in order to install 100 to 200 megawatts, but rather by local entrepreneurs. And they don't have always access to capital because these type of smaller tickets are not in the radar screen of the big -- bigger banks and of the bigger financing capital markets in the international market. There is a very interesting transformation that is taking place as we greening up the economy, which is not very often discussed. Right now, energy production is an oligopoly in the hands of very few companies and/or very few countries. The energy transformation means that energy production will democratize in the hands of many more investors and the revenues and profits generated by it will fall on a much broader footprint. And we want to facilitate the transformation. We want to be the bank of choice for those entrepreneurs in our countries of operation, which see opportunity for themselves, for their business, but also, they want to contribute to decarbonize their economies in their countries. So to sum it up, sustainability is truly part of the DNA of ProCredit since inception. We have a strong track record that demonstrates our ability to be a leading bank for SME companies. And for SME company, we have an impact that goes well beyond the capital that we allocate to them. We want to use the track record, that knowledge, and we want now to transform ourselves into a green champion. That is a leader in renewable energy in our countries of operation, but also an example of how you can balance economic growth profit with protecting the planet. And that means aligning ourselves to the net zero journey and bringing our Scope 3 emission to 0. I thank you very much for your attention and now I pass it to Eriola.

Good afternoon to all the guests in the room and to all the guests online and a very warm welcome from my side on the Capital Markets Day 2024 for our group. My name is Eriola Bibolli and it is particularly remarkable for me to stand in front of you today. My professional experience extends beyond 23 years of working for the group and I have been working most of my time in the subsidiaries, leading our bank in Kosovo. And I have been seeing firsthand how our business model, our strategy, our identity work on the ground. I know what it means for our clients, what we mean for our staff and what we mean for our countries. And in the last 10 months, I have been already a part of our head office in Frankfurt and I had the opportunity to see our group and our values from another position, from another angle. And this is what makes me stand here today to share part of it together with you. And in addition to the foundation already laid forward from Hubert and Gian Marco, I'll try to transmit our group's ambition, energy and commitment to mobilize us to get where we want to go. And it is a journey of growth and positioning that considers the fundamentals we think in a number of ways that we approach the business and why we stand for what we stand. And before talking about growth and prosperity, we need to start with the potential, where do we see the potential and what constitutes the basis for our belief and ambition in growth? And I'll touch a bit more to whatever Hubert started to describe. We are positioned in Southeastern Europe and Eastern European countries. And this region has already increased political attention, geopolitical attention and the most important development that we see going forward, it is our region. It is on a journey for the EU convergence. And a journey to the EU convergence has quite a big gap to go. Only 35% of our countries are estimated to be converging to the EU. And the rest of the gap, it is already a potential to be explored from many angles. And there, in addition to the domestic potential the countries have, the EU convergence has an economic component and has an impact component. The economics component needs to work. And already, EU estimates that the economies of at least Western Balkan countries, need to double in size of GDP during the next 10 years. EU, only in November as a last step, approved a reform and growth plan of EUR 6 billion but among others, entails to integrate economically Western Balkans as a region further, maybe in other markets, similar initiatives might be taken, meaning that we want to see a region market in the Western Balkans and an integration of this region into the European market via convergent and streamlining of the supply industrial chains of this region and other parts of Europe. And there is a lot of economic and political support to the countries. But in order to implement this and to get there, reforms are needed and reforms mean that economics would not be enough. It's a precondition. In order to get there, these countries and Europe needs to share a common set of values. And this requires a lot of societal changes. And this is where we see our role, our bank, our group, which is a strongly rooted group in the region, presents precisely the ingredients, the combination of a financial institution, mobilizing capital flows and a lot of support to the countries to develop the economics part. But in addition, we offer, knowledge, capacity building, investment in staff. We help our clients increase quality and assurance standards, meaning that our role extends beyond a financial institution capacity to develop the region. And this is why we belong to the region. We make sense to the region. And this provides one fundamental part of our foundation to build our growth and prosperity story. And for the economics, it is very clear. Our region has continued to grow. It is an exception compared to the economic development in Europe, where we see constant GDP growth and we see a lot of benefiting economic potential from the reshuffling of the geopolitical supply chains and the region was capable to attract FDI and to continue to grow and to prosper further. It means that we have already invested more than EUR 1 billion equity to the region. We are committed with staff capacities and build into the region. And we are and will be well positioned to accompany this development and to benefit from the potential. When it comes to the financial sectors, the region continues to offer attractive potential because the sectors are growing. We have been seeing in the last years, double-digit growth in both demand for credit and growth in local deposits from both retail and legal entity customers and this is a growth that is there to stay. The markets are fairly stable without representing structural risks in the financial system and they are still profitable. So from the overall context environment perspective, our region continues to be quite attractive. Then how -- where do we stand? I mentioned a number of elements but I'll elaborate further on. In this context, we are well positioned to capture part of this growth potential in the years to come in the future. And what is our ambition to get there? First of all, we have been rethinking our understanding of growth and we are kind of shifting the gear. We want to increase the footprint, in the number of clients that we serve, moving away from a rather self-restricted and self-imposing selective growth, we are broadening up our understanding of customer segments and entering segments that have been not our focus, underserved and these are the segments of clients that needed us the most in the years where we shifted our attention from them, which is lower end of small, micro and very small clients. And as a result, our number of clients multiply would be 2x number of small clients, 4x number of micro, very small clients and more than 2.5x multiplier growth in the number of retail clients. Then we have a very unique opportunity as a very strong SME positioned bank to explore opportunities in the more granular part of the market that I mentioned and there are unexplored strategic potential for this granular part. Smaller customers tend to be loyal. They are fully Hausbank with us. All the business is with us. From the risk asset -- risk-weighted asset perspective, they are not capital intensive and we can leverage our risk-adjusted profitability and it helps us achieve a broader impact because the numbers are big and we can penetrate to a broader part of our society there. So what does it mean then in terms of loan portfolio growth ambition and equally deposits -- customer deposits growth ambition. Our aim in the medium term, 3- to 5-year guidance is to double at least the loan portfolio with a redistribution of growth towards the lower end granular part and with doubling of the minimum deposit side. And why do I start with loans first. Loans is a very important part of our institution not only from the profitability perspective, they are our main source of interest income and they are our main source of fee income. But at the same time, credit -- it's a very important tool bridging our relations with SME clients. If you do credit in a healthy manner, customers are sticky and they appreciate with you. And it helps us bridge long-term relationships with customers. And deposits equally give us another picture from another angle. Deposits and this ambitious growth would be a testimony that our customers trust us and then we have an appealing value proposition and a good customer service. And equally, this picture indicates that we are ambitious to, as I said, at least double the loan portfolio growth. And more importantly, we aspire to self-fund the growth of our loan portfolio with growth of our customer deposits from loan segments. And the novelty that we have not seen in the past history of the group is that as a minimum, half of the stock of the customer deposits and more than half of the growth will come from retail clients and how and what are we undertaking to get there, I'll try to brief you in a nutshell. Starting, first of all, with our approach to SME clients. I talk SME without a particular attention on micro. Then what would be the starting point? SME, it is our foundation. It is our strength and it is what provides the basis for a further solid and confident growth forward. Starting from the market share perspective, we -- although we are small group and by asset size, we might not be comparable to other players but in SME, we are the bank #1 in a number of countries and we might be the bank #5 in small banks like Romania. So we are a relevant and significant player and this is a strong starting point in SME. At the same time, SME can be successful only if you are able to develop a solid customer profile and to know well which customers to serve and to work with and which not. And there, this is our key strength in developing a solid SME business across more than 25 years of history. We have been already an institution of choice for many entrepreneurs, who have a solid -- they're transparent, formal, with a solid vision forward and with an ambition to grow and further develop our business and we are a natural part for these businesses. As a result, SME today constitutes 88% of our loan book. So it is a very important foundation of our institution but below -- beyond numbers, just 88% of participation does not tell the entire story because our impact, our, let's say, identity in the countries it is achieved through this 45,000 SME customers that we serve today across the region. And it's our pride to have been able to accompany and see most of their projects take off, grow, thrive and inspire not only us but even other partners. Then what would be our strength, why do customers choose us? I do not want to talk about us the way we see strength ourselves. But the right way to understand it is, why do customers like to work with us and to choose us. And here, I would mention only a few, although the list might be larger. The first one, we have a track record of trust, ability to develop long-term relations and we have very strong rooted local expertise. Local expertise means, all our subsidiaries are run by local management teams who are very well integrated into the society. And we have skilled and the most experienced business client advisers with very strong advisory capabilities who are able to understand the business of the customer, to provide healthy and fast solutions, they are accessible, approachable. Our culture, it is oriented towards serving customers well. And this is what has been already a foundation of our strong success in SME in the countries. Secondly, we are one of the rare institutions that uniquely has brought to our region, the concept of Hausbanking, meaning that our customers are loyal to us. And at the same time, we try to serve all the customer needs and continue to capture the demands and innovate. And last, it is easy and convenient to do daily transaction business. No matter how strong we are, if the daily life of transactional business we offer the customers is not smooth and it's not easy, they are not sticky. And we pay a lot of attention to that as well. So despite of being a very successful and a leader in SME in our markets, there is still unexplored potential and room to grow further. So what else can we do and what is our focus. So our focus is, first and foremost, to continue to consolidate our strong leadership position. It's a strong foothold and we want to leverage and explore and build upon it further on. As a result, in every country of operation, no matter how small or big, we start from solid base anyway. And we aspire to be, if not #1, minimum #3 in terms of market share in SME and we are on a strong way to getting there. By doing so, we are well positioned to cater, understand and fast respond to the market opportunities and design our infrastructure accordingly, so that would be the first one to react and to serve the customer potential. At the same time, we are able and committed to further leverage our regional potential concept in the line of other elements I mentioned with EU convergence that -- there is still room to reposition and explore synergies between the countries and synergies between our countries and increased convergency with EU and Germany in particular. And what exactly there are we going to do? We can differentiate in SME, while continuing to master and to streamline our key competitive advantage, which is leadership in relationships, in networking and in advisory capacities. And there, we are already trying to increase capacities, staff capacities, human capacities. We are doing this by sprucing up business client adviser capacity via not only revising lending operations and streamlining processes to be easier and more efficient but we are already integrating technology and mass outreach solutions for the granular part of the loan portfolio that would release capacity on the advisory service dedication to the SME customers. Secondly, we have revised our product offering in addition to what we already offer to SME customers to capture and to close gaps in the market that we do not serve. We are already rolling out across the group, POS terminal networks in order to capture segments of customers that simply did not work with us because we did not offer this kind of service. We are rolling out platforms that exist in other parts of the group in e-commerce services with more modernization and the shifting digitalization of the SMEs, then we see if [ she ] needs, across the group to use the synergies better and to roll out, as I mentioned, these technological solutions and to expand further. At the same time, we have a strong focus, without sounding cliche, on marketing. And marketing is more about sharing inspiring client stories that we see every day. But it is not enough for us and for our people to see inspiring projects. We need to make role models, local champions and good examples and this is where our focused, targeted marketing is geared when it comes to SME customers. Then how, on the infrastructure perspective, this can be achieved apart from what I mentioned. We understand that an important branch network and footprint plays a vital role into this process. And we are committed to continue not only to sustain but to expand a lean, without a major burden on the cost side, our branch network. For the simple reason, the branch networks helps us gain proximity to clients and to the commercial centers. In SME, meeting customers, personal contacts, personal relations and good integrations with the SME hubs and commercial centers plays a very important role to be sustained as a competitive advantage. As a result, we are expanding the branch network as premium advisory centers, as I mentioned, with plus 15 branches. You cannot serve SMEs from the head office or only from the capital of our cities. You need to be -- and we need to be closer to where customers are and this is how relations are being maintained and further built, marketing, I already mentioned, I'll not stop there. As a novel refreshing perspective, we bring our proposition for the micro clients because it's a segment that we have shifted the focus away for different reasons, trying to understand the segment better and how it would fit into our SME story. And we confirm that it is a very important segment, complementing the value chain of our SME customers because the customers that work with us in micro, very small, are customers that are formal, digitally affin, they make the fabric of societies as solid entrepreneurs, engineers, sometimes doctors, smaller shops. And they are the future basis of our SME customers if they are served properly and integrated into our business models. And we have now reshifted a strong focus there. And we have tailored accordingly the capacities and above all, the technology because this is a massive group and it needs to be approached as such via efficient digital channels, via automation of the loan origination, automated credit decisions and other tools as well. In addition to the SME, we had everything and a profound one on our approach to retail clients. And there, we repeat, that we see an attractive market, then we see our countries in the progress to adopting digitalization and we see already profitable business and we have a good starting point there. The starting point, we mentioned that we have a solid base and an emerging base in a number of the countries. And we have already achieved solid progress and results in the last 2 years. We admit that we have had very selective and very niche narrow approach in retail, maybe 5, 6 years ago. And because of a rapid digitalization a bit ahead of markets preparation, we separated with a number of clients. And in the last 2 years, we understood that we want to serve a broader segment in retail. And we started to correct part of this narrow focused actions that we took by revising our product offerings, value proposition, being open for a broader, more wide segment of universal approach and we accelerated investments in technology and even in the brand infrastructure. So what we aspire to do in retail? First, we want to become the bank of choice, offering full slate services for retail clients. I mentioned we have a profound change to growth because we want to grow. In the past, we were a bit more self restricted to that. And we want to continue to serve all ages, despite of the digital affinity, despite of where is the life cycle of the customer or how big is the balance sheet of the customer. And we target as a minimum to increase with a multiplier of minimum 2.5 number of clients and to double, as I mentioned, customer deposits raised from this group. And how are we going to achieve that? First and foremost, implementation of a successful strategy in retail cannot come without the right people. We are rebuilding retail teams in all the countries. And we are recruiting people with the shift in the mindset of what retail means and how to approach retail in a broader massive scale, a skill that we had selectively present in the institution. At the same time, we had to revise, I mentioned the product offering but the success in retail, it is not only the product or it is not only the service channel, it is a blend and a mixture of both. We had to offer the full spectrum of products, cards, credits, savings plans, everything that the customer need. But at the same time, the customer journey continues to be fundamentally important. And customers want smooth, daily operations and a seamless journey with our digital infrastructure, digital onboarding, digital mobile app. But at the same time, they want us to be accessible when they need it. And we had to offer and we are offering 24/7 virtual call centers. And last, we are open to customers with bigger balance sheets and a bit more mature stage in the life cycle, they are homeowners, they are savers that require a bit more advanced advice and solutions. And for them, we are reopening advisory centers in order to offer the right service and the right confidence for the customers. And last but not least, we are rethinking investments in marketing, not only in the sense of commercial sense, digital marketing and how do we make ourselves visible but marketing is also about conducting common community activities. In all our countries, we participate in art, sports, other events together with the community and this is part of our complementary impact story with retail. And in order to have the confidence to get there, in retail, we have unexplored synergies among our business units in the group because we have strong ties with SMEs but these SMEs are run by individual people, business owners who have private clients need. They all have employees. We have a number of strong partnerships that they have employees as well and simply utilizing better these types, we are already able now to progress in the increase in staff numbers, in the increase of deposits and in the increase of loans as well. So on the segments and on what we are doing, this is clear. How does our then growth and positioning story look on a geographical footprint? And there, we separated -- categorized our banks into 3 major subgroups. We have 2 solid mature banks, Kosovo and Bulgaria. They are the banks with the strongest presence in their market, with the biggest balance sheet and the right balance sheet structure. And these are the institutions that would continue to further grow and accelerate and be the key drivers of our strategy. We have 2 other advance banks, Serbia and Macedonia, that have a very strong prospective to grow. But in the meantime, the 2 banks have to undertake structural improvements in the balance sheet on both sides of the balance sheet, profitable assets and optimize cost of customer deposits with a higher penetration and participation of retail in order to further improve their profitability. So the goal there is size, growth but profitability as well. And we have a number of other smaller banks where the challenge is bigger because these banks need size, they need to increase number of clients. They need to increase both sides of the balance sheet. And at the same time, they need to restructure. So a lot of focus, attention and management energy is into the smaller banks as well. And last but not least, what would give us the confidence that we would be able to successfully implement such an ambitious growth and positioning story. And perhaps it's a coincidence but I cannot feel more accomplished than representing the achievement of our sister bank in Kosovo, where I used to serve for -- as a -- more than 23 years, as I mentioned, as a role model and flagship for the group. Yes, in Kosovo, for 23 years, we're able not only to deliver rock-solid financial performance of a double-digit ROE of over 20% but we represent an impact story. In Kosovo, there is not a single entrepreneur that was never served by us. Everybody was served by us. In Kosovo, there are more than thousands of staff that have been going through our training facilities, our academies and they today contribute not only for ProCredit but for the society, economy, private sector, financial sector wide. So Kosovo has critical size. It has been a leadership bank in SME and in retail. And it's important to mention that Kosovo has been universal bank and this is what constituted the success. And by being a successful large universal bank, it managed to build the brand, it managed to produce financial stability and it managed to achieve the impact that we aspired to achieve in the group. So Kosovo now, it is not an outlier that the group did not know how to understand but Kosovo today, it's a role model. And as I said, I cannot be more accomplished than just presenting Kosovo story today. And perhaps my colleague, Visar, would continue to tell more. So as a summary, we are excited that we are talking about a growth and repositioning story that we have been longing perhaps and I'm speaking now more from the perspective of someone who was sitting in the banks until 8 months ago. And we are committed and positioned to sustain and to explore further our foundation of being the leader, top 3 in every country in SME and a solid, modern, full-service bank of choice in retail customers, as such, would be able, not only to build sustainable financial performance and profitability but we would be better equipped to serve our impact role and to be a good partner in our societies. And by so, I invite my colleague Christian to tell us how the numbers would look.

Thank you, Eriola and welcome, distinguished guests here today and guests online for this Capital Markets Day and the final section of this first part of our presentation. The word balance sheet transformation has been a bit at the center of today's presentation. So in this section, we will rather show you how this balance sheet transformation will actually look really on the level of the financial statements of the group, starting on the asset side. Eriola already highlighted the implied loan portfolio multipliers that we envision for each of the segments, 1.5 for medium, 1.5 to 2 for small, up to 4 in micro and 2 to 2.5 for PI, to basically bring the entire loan book up to a level of EUR 10 billion. That is a multiplier of 1.6. Now why the focus on the smaller segments? Today, the loan book consists around of 60% of loans of medium-sized loans, 40%, the rest with a bigger share of small. The proposition here that is implicit in these low multipliers is that 60% of the future growth will come from the smaller segments and 40% for medium and that will bring basically the share of medium loans down from 60% to 50% and implicitly the share of smaller loan categories from 40%, up to 50%. Why this shift? Why this focus? Why the emphasis on this? Eriola specifically already alluded on the impact perspective. Smaller segments are indeed those type of clients where we know that they are underserved, inadequately serviced by other larger universal banks in our markets, typically with a retail approach, meaning that the service that is provided to them is not specific to their particular situation. It's not tailored to what they need and inadequate financial services often leads to over indebtedness and to ultimately business failure. So from an impact perspective, there is a clear value proposition. But there's also a positive impact that is internally, that is a positive business case that I would like to explain to you now. First of all, weighted average interest rates are different from segment to segment. For the medium segment, we observe interest rates of around 7%, in small, that is 1 percentage point more. In very small, it's another 1 percentage point more. So transforming the loan book towards the smaller segments will help us consolidate, will help us strengthen margins and ultimately prepare us for a downturn in the interest rate environment, which many analysts today expect. In PI, by the way, we see a relatively low interest rate here of 5.1%. There are multiple reasons for this. First of all, today, most of this PI segment is housing, highly collateralized mortgage loans, one; second, there is a strong concentration of this PI portfolio in low interest rate environments, Kosovo, Bulgaria, basically a very negligible share in the high-yield environments, in the high-yield markets that we serve, Ukraine and Georgia. More realistically, what you would expect as an average interest rate in PI, it is somewhere between small and micro. The business in PI is not designed to strengthen margins. It is not designed to maximize profitability. This Gian Marco already alluded to but it is part of the greater picture of having a greater granularity on the asset side and later also on the liability side. Second, Hausbank concept is something that we have historically always talked about, it was emphasized again today. Hausbank concept is simply something that we can much better enforce in the smaller segments. We are the uncontested Hausbank for essentially all our small clients. The more we edge up sort of the medium segment towards the corporate segment, where then the refinancing need of the clients tends to exceed a single-digit million amount, then we are obviously, from a risk perspective, required to share the client with other banks and the bigger the client, the less likely we are to be in a strong position of the Hausbank. The application of the Hausbank concept we have here illustrated by the deposit-to-loan ratio, which means, how much deposits do these clients bring versus the loans that they require from us. We see 50% in the medium segment, 85% in the small segment, 200% in micro and 500% in PI, which is not a surprise. This is sort of the built-in modus operandi of banks that also Gian Marco already alluded to. But the deposit, largely is an illustration. It means that with 85% deposits brought by these clients then refinancing them for us is much more economical, it's much cheaper, so that's besides the point of the weighted average interest rate that we see in the segment. But it's not only deposits, Hausbank concept also means stickiness of clients. It means that we can plan with them for a much longer term. It also means generating additional fee income because having them our -- being their Hausbank means that they will do the entire transaction business with us and ultimately, it also means that we have a better risk control over these clients from a credit risk perspective. On the level of the clients, if they are our Hausbank, we observe the turnover and we are more reactive when the clients are in distress than when we're second, third or fourth tier bank. Fee income potential is, of course, highest with medium clients. Medium clients tend to have large payrolls, a large number of staff. They transact nationally, internationally. Therefore, they have need for international transaction services. They also have -- may have need for trade finance. So the potential of generating meaningful fee income with these clients is very high. But again, it depends on the application of the Hausbank concept. If the client is indeed not fully onboarded with us, then much of this potential will go into the smaller segments. And lastly, also an aspect that Eriola already alluded to, risk-weighted asset efficiency. We apply the standardized approach, according to the European Union application of CRR. That means there are 2 important provisions that are relevant for our risk-weighted assets calculation for credit risk. That is the retail factor and that is the SME factor. For medium clients, we have typically risk weights of 75%, up to 85%. That is if these -- if the exposure to these clients exceed EUR 1 million, then we are at a 75% risk weight. If they exceed EUR 2.5 million, we're already at an 85% risk weight. The category is small and micro. They benefit from the application of both SME factor and retail. And therefore, their risk weight comes down to 57%, making them very attractive. Whereas in retail, we have a fixed 75% risk weight. This is a simplification and rather a regulatory view on the topic. Of course, we are also working systematically with guarantee products that are more centered to the medium and small segment that can also optimize risk-weighted asset density. Now let's move to the liability side. There are 2 important aspects that we have highlighted in the course of today and that I want to reemphasize. One is the mere volume of deposits that is characterized -- that we characterize above all by a deposit-to-loan ratio of 120%. Why 120%? Well, first of all, in order to give out -- when we collect EUR 1 of deposits, we can only finance around EUR 0.80 of loans with that because deposits come with the obligation of maintaining adequate liquidity buffers. Why not more than 100%? Because excess liquidity, especially in local currency, will bind capital on the level of the group and will make us less capital efficient down the road. So it's not really that we want to reach 120% and exceed it but 120% in many aspects, bank to banks, there might be some differences but is a bit of the sweet spot. Second is the granularity, that means the granularity we express above all by reaching a share of private individual deposits of at least 50% going forward. Right now, we're in and around 40%. Now on both these points, we have already been delivering strongly over the last 2 years. On the deposit-to-loan ratio, if you think back, only 2 years ago, on the group level, the deposit-to-loan ratio stood at 93%. Today, at 116%, that means a 22 percentage point growth that we achieved on the level of the group and that is also reflected on the level of the banks. Because again, 2 years ago, there were exactly 2 banks with a deposit-to-loan ratio of above 100%. Bulgaria and Kosovo, the ones that Eriola highlighted are from a balance sheet structure, the most mature ones. Today, there are 8. And there is a ninth one following very shortly. So we have made some progress but 100% is not the goal, 120% is the goal. So there's still some way to go. And there is some way to go also to bring the smaller banks up to the size. Once you have the size, it goes into the topic of granularity. And again, granularity is through PI growth. And also here, we have made good advancements in the last years. In 2021, PI deposits grew by around EUR 200 million; in 2022, EUR 300 million; and in 2023, EUR 500 million. And with these EUR 500 million, their contribution to the total deposit growth was in and around 50%. Now to transform the balance sheet, this share would need to increase further in the future. One should also note that our recent success in PI was a bit focused on term deposits, especially in the context of the current interest rate environment. So we have been attracting a lot of term deposits from private individuals, which are not necessarily helping the net interest margin. Still, the group net interest margin has developed positively. But the idea in the next years is, is of course, to attract private individual deposits in all client -- in all product categories that has high deposits and savings deposits, which will have an additional structural positive impact on our refinancing. Now the success of our strategy of attracting deposits has already in the past years led to a significant increase in excess liquidity. Highly liquid assets increased by almost EUR 1 billion over the last 2 years and their share in the total balance sheet today constitutes almost 36%, compared to 28% in the previous year and compared to even a lower percentage in the previous years. That raises the question, what to do with the excess liquidity. And here, we envision also in the future to have a more group-wide view on how we invest this excess liquidity wisely. Today, much of the excess liquidity is parked at central banks or at the German Bundesbank, that is not always efficient, neither from a margin view nor from a capital intensity point of view. So going forward, this will be an additional element of how we handle excess liquidity that will enhance margins and improve risk-weighted asset density. Now how do all these measures enhance our medium-term profitability? We see here the walk from our current level of profitability, 12.2%, which coincidentally also is our old medium-term guidance of around 12%, how will it get us to 13% to 14%? Above all, there's increases in operating income. The assumption here is simply that this growth in operating income is more or less in parallel with the expansion of our business, means more clients, larger balance sheet volume resulting in higher net interest income, higher net fee income, higher income from FX transactions. We did not factor in here the positive structural impact that our asset transformation will have because we assume that this will be largely offset by a declining interest rate environment. So the assumption for the net interest margin is to remain on the level of 2023, which is 3.6% and which, by the way, is an implicit reduction of the quarter 3 and quarter 4 levels, which were between 3.8% and 3.9%. The second aspect is cost efficiency. It is clear that with the substantial investments that we foresee, that will rather happen in the short-term horizon of this medium-term projection, that cost efficiency expressed by the cost/income ratio will go up in the short term, and we get to that point in a minute. At the same time, we are committed to manage these investments prudently, meaning in the short term, our ROE should remain on the good level that we have achieved in 2023. That means in and around 10% to 12%, two digit. In the medium term, we target a cost/income ratio of 57% and thereby confirm our previous outlook for this metric. Now in this projection, we factored in, of course, scaling effects that is build in the model, higher asset growth and the under-proportional growth in terms of administrative overhead. But at the same time, we were prudent and cautious not to understate the operating cost base in the long end of this medium-term guidance. Now at the bottom, we see the point that Hubert already made. In this assumption, we have not factored in a significant upside from ProCredit Bank, Ukraine. The assumption for ProCredit Bank, Ukraine is to achieve a low double-digit profit contribution to the group that is basically what the bank achieved or slightly overachieved in this year with a profit of EUR 17.7 million. The upside potential, as Hubert mentioned, would be in and around 1.5 percentage points. If the bank manages to grow like it used to grow before the war, those were growth rates well in excess of 10% and achieve a local ROE, a stand-alone ROE, I should say, of around 20%. Now we can also look on how the medium-term guidance will be achieved on the level of each individual bank. This table here shows basically the results of our banks in 2023, and we see that the large bulk of our banks are in an ROE bracket of 12% to 20%. Two banks are above 20% and 3 banks below 12%. Here, one should note the ROEs of Albania is around 4%; Romania 8% and Ecuador negative given the current challenging economic and political environment of the country. Now going forward -- first of all, to put this graph also into perspective, if we were to look at this 2 years ago, we would have no bank above 20%, and we would only have 4 banks in the bracket of 12% to 20%. So it is particularly encouraging that some of the strategic elements that we're putting in the focus today, that have already been worked on in the last year, such as deposit-to-loan ratio, such as a larger share of PI loans, has helped transform the P&L of some banks. And we have Amina here from Bosnia and Herzegovina today to make exactly that case, of a relatively small bank that with a strong focus of sourcing local deposits has transformed essentially a loss-making bank in 2019 to a bank that is generating a healthy profit 4 years later. Now for our medium-term projection, we expect that all banks will meet the hurdle of 12% return on equity. And here, of course, we would expect market -- or banks operating in more volatile environments to have a relatively higher profit contribution than others. In addition, we see now, also as part of our strategic toolkit to achieve our goals, also inorganic measures such as mergers and acquisitions. This is important to communicate because as you know, all our banks are greenfield operations. We have never engaged in any meaningful mergers and acquisitions in the course of our 20-year long history. And going forward, this at least is a possibility. I should note, however, that we think it will be very challenging to find an institution that meets our requirements of a lean and clean operation with a corporate culture that is aligned with our impact orientation. And that also does not destroy or distort the good diversification of our assets and even diversification of our assets across the map. The colleagues also alluded already to the investments that we'll be undertaking in people, in our branch network, in technology and in marketing and communication. The investments are detailed here below, and they will take place more on the short-term horizon, as I mentioned, which is why we see a bit of a bump in the projected cost/income ratio starting at a good level that we have today, 60%, probably increasing to 63% in the short term and then coming down to our medium-term target of 57% in the coming years. The investments are more detailed below. In terms of staff, we expect an increase of around 25% in the course of the next years. In terms of our branch network, as you already alluded, approximately 10 to 15 new branches, mostly really to boost our MSME business. And this new branch work, along with the renovations that we undertake otherwise, they would probably add around EUR 10 million to the overhead attributed to the staff -- to the network, reflected in depreciation or office rent expenses. In terms of IT, we foresee an increase in the budget of around EUR 12 million for the coming years. That's an increase of around 20%. But in both these indicators, we foresee medium-term efficiency. That means loan portfolio per staff should increase in spite of the staff increases and the cost per loan portfolio in the context of IT should also come down in the medium term. And in terms of marketing, 2023, we spent around EUR 10 million on marketing. That's already a substantial increase compared to previous years, and we envision this budget to increase by 50% going forward. Now we will close basically the section with a view on capital. Today, our CET1 capital stands at 14.3%, that is against the requirements of 9.3% for CET1 and 11.4% for Tier 1. The total capital ratio stands at 15.3%. That's against requirements of 14.3%. Overall, we think that these buffers are very adequate and we continue to review this capital structure in the coming years to achieve optimum capital efficiency and that we also have to gauge always against market conditions, obviously, for any potential transactions. It is important to note that for our strategy, we confirm our dividend policy of distributing 1/3 of the consolidated result. And also here is the -- in the graph below, you see the graph for risk-weighted asset density, we have improved risk-weighted asset density substantially in 2023 through various measures. First of all, we attributed guarantees of international financial institutions, who we work with on a strategic level to our risk-weighted asset calculation. The same we did for hard collateral of a specific bank that is operating under the same CRR rules that the group operates in. Further, we have engaged in a synthetic securitization project that has helped reduce risk-weighted assets with a minor negative impact on CET1 capital, and we have expanded our cooperation with MIGA which helps us guarantee Central Bank balances in the countries of our operation, which according again to the CRR rule are typically weighted at 100%. In the case of Ukraine, currently, even 150%. Going forward, some of these projects might continue to find application, meaning we will continue to explore whenever it makes sense to improve risk-weighted asset density. Also, the portfolio shift that I mentioned earlier from medium to the smaller segments will improve. And with that in mind, we think we can bring the risk-weighted asset density down by at least another 4 percentage points in the coming years. Now with all that in mind, let me summarize again the increased and transformed asset and liability structure and an expected stabilization of the net interest margin around 3.6% will be key to leveraging the profitability going forward. Strategic investments will be more on the short-term horizon and help us achieve the cost/income ratio in the medium term of 57%. And especially on the level of the banks, all our banks have committed to achieving a return on equity of 12% structurally in the medium term, which implicitly means larger banks will undertake the investments, but maintain the current good level of profitability. Smaller banks, these investments will be so substantial relative to their balance sheet and P&L size that probably profitability here will drop in the short term but then be comfortably above the hurdle rate of 12% in the medium term, and that ultimately to help us to a medium-term ROE of 13% to 14%. And with that, I would conclude this first part of our Capital Markets Day. Nadine, we would be ready then to take the crowd's questions.

Thank you, Christian. We'll now start with the question-and-answer session. I'd like to welcome the management board members of ProCredit Holdings to take place on the stage. [Operator Instructions]. We'll now start with the questions from the analysts. Yes, Marius?.

There's just a bunch of questions from my side. The first one would be a rather easy question. What is your definition of medium term? Should we think of 2027 maybe? Second one is, how do you reflect your impact banking approach when it comes to private clients? How should we there think of loans that have a positive impact on society? Another one would be that assuming we have -- we see lower loan sizes going forward from micro clients and also from private lines, how do you ensure to handle these loans efficiently in order to keep your costs under control and therefore, keep your trend of declining cost/income ratio? And then maybe could you explain the competitive situation for personal clients in your countries of operation? I mean, we have a good view on the SME side, there you are very strong, but how is the situation for the personal clients? And lastly, what do you consider as more efficient ways to park your excess liquidity than it is currently at, yes, the ECB or Bundesbank, which pays quite attractive rates still?

Well, let's start with the first one, Mr. Fuhrberg. The medium term, we are on purpose, not 100% precise, as you know, on what's medium term, but we would define it somewhere in the region between 3 and 5 years. The second question was?

On the impact side of PI lending. We intend to apply the same responsible approach to PI lending as we do for all of our lending operations, meaning that we take a very individual look at the client payment capacity and we make sure that the client is put in a very solid position to repay their loan. And the loan must be proportionate to the income generating capacity of the client and also not stress the client in a situation when they might appear in the future. So we really take care not to maximize the profit through PI lending, but to minimize the default rates. Now we will need to use technology. We do use technology already very much to originate loans and we will continue to do so because indeed, it's question of convenience and a question of efficiency. Technology can be used for good use or bad use. We intend to use it for good use, meaning that the way that the credit risk is assessed. Again, it's very much on the prudent side, but the whole cycle of origination and also following up the signing of the contract and all the monitoring and repayment, of course, is digital platform based. Our markets of operation are competitive of course, on the PI lending side. But our products and services are also competitive. As you see, our pricing is adequate for this type of target group, we don't overcharge. In fact, our competitive advantage is speed and quality of service. And as long as the pricing is good and as it is, we believe that we can also penetrate more dynamically in this market. Finally, last but not least, we have a leg up on the green financing also for individuals. Currently at least 10% to 15% of our PI loan portfolio is greener, and we plan also to extend that more into the future as we penetrate a larger target base.

I can expand on part of the question, and I'll start with the market share. It is indeed true. We start from a very low market share. In customer deposits, in retail, our banks on average would have a 1% market share with the exception of Kosovo, which has a larger market share. And there are two ways to look at it. It is a challenge because it is not a strength as a starting point. But at the same time, it tells us that there are competitors to attack and there is a potential to grow. If we would have started from a 20% market share, then such a growth and positioning story would have been already close to its limited capacity. So we would want to see the market share more as an opportunity to get our homework and to execute our plan and to attack the competitors because we can be better than what we are. Secondly, on the impact. Retail impact should be tackled as a segment. You cannot separate assets is an impact and liability is not a vice versa because retail can be considered as a constituent of our society. It is very important that we engage in a dialogue with these customers. We talk about sustainability, we talk about green, we talk about principles, we talk about values, we talk about transparency and you cannot achieve impact just by supporting the SMEs, but we want to see the society and the private sector intertangled and integrated. And in retail, retail is very important complement of our business model, simply because it would provide financial stability and the profitability, but we see a close component into the impact story as well. Because, as I said, part of our customers are the owners of the businesses, and they are retail clients and their staff, they are retail clients and the staff of a lot of other partners we have and regular savers, engineers, nurses, doctors in the society. We are prepared to see them holistically as important clients. They need cards, daily business transactions. They have savings and they need loans. Same as everybody else in the room as a private client, and we are proud to serve them responsibly.

And Mr. Fuhrberg, coming back to your question about how do we serve smaller clients and PI clients, we've flown sufficiently. I would kindly ask [indiscernible] to elaborate a little bit on how do we change our processes. But to start with, I would want to mention that we have reflected the somewhat higher risk associated with the shift in the composition of the balance sheet on the asset side, in our assumptions of cost of risk. You might have seen, we touched upon it yesterday in the analysts call also that in the short-term guidance, we do anticipate up to 40 basis points cost of risk. And in the medium term, somewhere between 30 and 35 through the cycle. This is way higher than what we experienced in the past. If you were to exclude the year 2022, which was overshadowed by the Russian aggression to Ukraine, we had throughout the cycle before, cost of risk way below 20 basis points. So the risk component is reflected. And as I said, [indiscernible] I'd appreciate if you could elaborate a little bit on the efficient delivery of this [indiscernible].

Correct. It is a relevant question for micro and for retail clients. And there are 2 directions that we are focused on. The first one, it is the technology part because in micro and in retail, first of all, we need to increase the number of clients and to be better able to serve the new ones. Increasing the number of clients means that from April, we are deploying, across the group, digital remote onboarding of clients. It is a group solution, and it will be deployed, as I said, in a timely fashion until the end of the year across the group. And this will already allow us to efficiently onboard a massive number of retail and micro clients. Secondly, when it comes to lending, we are already in parallel to this developing automated efficient process on loan origination that integrate automated decision-making based on a scorecard for exposures up to EUR 100,000 and will deploy the solution in the first half of this year. And this is the only way to uniform credit standing to make possible that we stick to our responsibility of not overdating the customers and to achieve the efficiency gains, as you mentioned, to be able to fast serve a larger number of customers via the automated digital solutions. On a second level, Hubert already touched upon that we have first revised the border thresholds of our segments, and we have streamlined very much processes in addition to the technological integration, and we have shifted more flexibility to decision lending to the banks rather than a centralized decision taking in the group, in particular, for the granular lower amount. And by doing so, we would be better able to explore and use the technological solutions we are integrating plus with the banks deciding faster, we can respond very fast to market demands and to the competition in the market.

Let me elaborate on your last question, Marius, unless there are follow-ups on anything has been said?

I think that's it for me for now.

Then let me elaborate on your last question on the management of excess liquidity. You have rightly identified that right now, good margins are earned on Bundesbank balances, in excess of 4%. This, however, will not last forever. This is clear. Policy rates will be the first rates to reduce before they trickle down into the system. So it is already important to anticipate this now and to think what we will do if this happens. The current situation also is that even though we do use the ProCredit Bank Germany to pool excess liquidity in hard currency to some extent and then place it on Bundesbank, this is not possible to a full extent. It is limited by our ProCredit Bank's ability to even have a meaningful counterparty limit with a bank outside of their country. So this is -- some countries cannot park meaningful amounts at ProCredit Bank Germany and, therefore, this money cannot be placed with the Bundesbank. So what we envision is especially for hard currency because we are indeed talking about hard currency. Our smaller banks are not big enough in size in order to leverage sort of a good relationship with a Western bank. As a group, we can leverage this position. And this is the idea going forward to do exactly this, to pool excess liquidity and to be then creating an investment framework that will help us place this excess liquidity in a prudent way, of course, only in very high-quality papers, but with a comprehensive view on risk, return and capital intensity, both on the level of the -- from the view of the banks and from the view of the group. Combining all of this, and therefore, generating, yes, positive enhancements on the level of the banks and on the level of the group.

I have two questions. Firstly, on your expansion or the [indiscernible] focus on the micro segment, I would be interested to know what is different like 5 or 6 years ago when you exited this segment? So what are you planning to do differently at this time than 5 or 6 years ago when you exited this? Then the expansion into the retail banking, what I don't really understand is with which products do you plan to make money? Will it be the focus on mortgage loans? Or will generally the expansion into retail banking mainly to get more deposits to fund the 60% loan book growth? And then on Ecuador, I think I've seen it only once on the slides. What's the strategy on Ecuador? How does it fit in? And last but not least, just a confirmation. Christian, you were mentioning the payout strategy, you would stick to the 33% payout ratio. I assume that also means that no capital increase is needed to reach the EUR 10 billion loan book?

I'll take the question on micro. We never truly exited micro, actually, we downsized in micro. But in all the countries, we continue to serve micro, but we shifted the focus and accordingly, the allocation of resources, dedication [ Audio Gap ].

Per unit output than all the other competitors. We are the only direct bank in Eastern Europe.

As part of this EU program, and I mentioned the last package, EUR 6 billion package that was approved in November last year from the EU, targeting not only growth, but it's a symbolical combination of reform and growth there. And it's not just boosting the economic potential of the region, but it intends over time to stop the migration because the closer the gap on a social and economical sense with EU and our region, Southeastern Europe and Eastern Europe, will be the migration at some point would slow down. But nevertheless, demographic movements and shifts would continue on a global scale and then it's an adjustment mechanism from the free movement of people there.

Thank you. We'll take one more question from the audience because we're already into the break and then continue with two questions from the chat.

[indiscernible]. I've got actually two questions. First question is for this margin chart that you just showed, so peaking in 2024 and then decreasing slightly. So I wonder due to this decrease, is this really only due to the interest rate environment you're looking towards forward? Or are you also extra conservative looking for the future and have some special buffer there implemented? And secondly, there was a chart showing that you help clients with the e-commerce business. So is this just for the implementation of payment solutions? Or do you actually offer like shopping solutions or something like that?

Thank you, [indiscernible]. Let me take the first question. No, there's no buffer really implied. 3.6%, I think, is an adequate assumption given that analysts do expect Central Bank rates to come down in this year, 2024, both in the U.S. and in the euro area. And like we benefited from these higher policy rates in the previous 18 to 24 months, this will have a negative impact on us on a rather short-term basis before the strategic initiatives that will transform our balance sheet helps structurally consolidate the margins at the current level. So 3.6% does imply a slight reduction, like I said, from the quarter 3, quarter 4 levels, which is rather 3.8%, 3.9%. And then really starting 2025, we hope to consolidate on this level. Nonetheless, this is obviously a key performance indicator that strongly relies on policy rates, and we don't have a crystal ball to really be clear on how the medium-term outlook would be, what is clear, and I think most analysts reinforce that view is that in the short term, policy rates will come down.

Maybe on the e-commerce side, we offer e-commerce solution right now in Kosovo, in Serbia and in Bulgaria. We are about to implement them in Georgia. Basically, it is accepting payments on the website of the clients. We do it through our proprietary technology upon the checkout of the client base with Visa or Mastercard or whatever other cards when we process the payment.

Actually, we do both. We do initially e-commerce, which in Kosovo was introduced in 2013, was mainly embraced from customers with the business model that accept payments. But lately, in particular, during and after COVID, we saw a number of our customers innovate their business model into online shopping. We see retailers and wholesalers already complementing or diversifying their traditional branch channel into e-commerce. And we see new greenfield investments into e-commerce shopping platforms and we are already a home bank of these customers. And in order to retain or to better serve this emerging, more modern, let's say, sectors of the economy, we have extended the e-commerce platforms to these customers as well. And some of them are even becoming regional online e-commerce shopping platforms. So it's to both.

Thank you. Yes. As we are already well into the break, we'll have two last questions from the chat. Of course, feel free afterwards to approach us with any additional questions that you might have. The two questions that we have is -- the first one, can you provide examples of the IT innovations in your markets where ProCredit has been a pioneer in the past? And the second question would be, you mentioned the 12% ROE hurdle rate. Does this mean that you will also divest banks, which after some years still did not achieve a 12% ROE?

I can give two. We are the only bank in Eastern Europe, which use a hybrid public/private cloud infrastructure in order to process all of our data. We host the private segment of our cloud here in Frankfurt in 2 data centers and we use Azure services for part of the operations. So we deleverage from local data centers, and we are cloud ready. The second one, we are the first one who introduced remote onboard and digital onboarding with client identification in several of our countries. [indiscernible] alluded it before, we are now going to Live ID technology with self-identification and we will launch this product in a couple of months in Kosovo, and we plan to roll it out to all the other banks. Right now, the identification [indiscernible] needs to be mediated by contact center operator. So it's remote, but it's not fully self-ID. And now we are introducing also fully self-ID.

We are the first bank to introduce G Pay digital wallet in Albania, and we will be the first bank to offer digital client onboarding there as well. So it's a number of first and I will not mention here Kosovo because in Kosovo, we have been the first bank to offer -- to bring an ATM to the country, to bring an international credit card to the country, to bring e-commerce to the country and the list goes on and on. Digital signature in the country today. We are the first bank, and we have been the first bank to bring innovation in the last 24 years.

On the hurdle rate, let us first explain what hurdle rate really means. It means structural profitability to be in around 12%. It does not mean that if in 5 years, there is a bank with an ROE of below 12% that it triggers an immediate action. But implicitly it means exactly this, yes. If we don't see that a bank can structurally deliver an ROE of 12% in the medium term, then we will weigh this up against our prevailing and expected capital requirements and potentially also consider divestments, yes.

That was the last question for today's question-and-answer session. Thank you very much for the interest and the questions. If you have any additional questions, as mentioned, please do not hesitate to contact us, the Investor Relations contact details are on the website. We would be very happy to continue any question you might have. We will now have a break and continue at 3:40pm as we are a little bit into the break already and we'll see you. [Break]

Welcome back to the second part of the Capital Markets Day. We'll now continue with the roundtable ProCredit on the ground. I'm very pleased to welcome today our colleagues from ProCredit bank Bosnia and Herzegovina, Kosovo and Ukraine. Let me briefly introduce them before we start. Visar Paçarada has been the General Manager of ProCredit Kosovo since July 2023. His responsibility primarily involves the business area in a broader sense, including business SME clients, private clients, marketing, sustainability treasury, anti-money laundering and human resources. Furthermore, he also holds the position of Vice Chair at the Kosovo Banking Association as well as Vice Chair with European Investor Council in Kosovo. Visar joined ProCredit back in 2007 and had various positions in the bank before becoming a member of the Management Board at ProCredit Bank in Kosovo in 2019. He's also a graduate of ProCredit Management academy in Fürth. Amina Durmo is a member of the Management Board of ProCredit Bank Bosnia and Herzegovina. She is responsible for SME business development, retail banking, sustainable development and communication. Amina leads the sustainability committee in the bank, advocating for environmental protection, gender equality and diversity, both internally and externally. Additionally, she's a member of UNICEF Business Advisory Council supporting causes such as child safety, mental health awareness and the transition from education to employment. Amina joined ProCredit in 2013 and started as a business client adviser, and she had various positions in the bank before becoming a member of the Management Board of ProCredit Bank Bosnia and Herzegovina in 2019. She too is a graduate of the Management Academy in Fürth. Last but not least, Viktor Ponomarenko is the General Manager of ProCredit Bank Ukraine. He is responsible for finance, treasury, business support and IT. Viktor and his team have been instrumental in keeping the bank in Ukrainian market steady during times of intense turmoil by ensuring safety of staff, remaining open communication with all clients and reinventing the bank's operationality from the distraction of the war together with our software provider Quipu. Viktor joined ProCredit in 2004 as Head of the Business, Clients Development Department and was the first Deputy General Manager before he became General Manager at ProCredit Bank Ukraine in 2012. He is also a graduate of ProCredit Management Academy in Fürth. Let's start with you Visar. There are three question I would like to discuss with you. ProCredit Bank Kosovo has always played a very particular role in the development of Kosovo. Can you provide us with some background to this? And most ProCredit banks are well positioned as SME leaders in their markets, but not so much in other segments such as retail. What are, in your view, the benefits of the broader business focus that characterizes ProCredit in Kosovo? And finally, what potentials or ambitions do you have going forward?

Thank you, Nadine. Well, thanks for the kind introduction, and thank you for the invitation. It's a pleasure being here. Now, next year will be our 25th anniversary of our bank in Kosovo. And summarizing the impact of our bank in Kosovo, quarter-over century basically, in 5 to 7 minutes, it's a rather challenging task, I would say. Nonetheless, I will try to detach fragments and try to depict and hopefully paint a picture of what we've been doing and what sort of impact we had in the country in the last 25 years. I would, in fact, like to start with a short story or a project that we inaugurated last year, which is our ProEnergy project, which shows our shared commitment and shared dedication of pushing forward the agenda of sustainability and decarbonization of our country. We have prepared the short video. We will start with that, and now I will take you through the rest of the Impact story of Kosovo so if we can play the video, please. [Presentation]

Yes. So this was the last project which we probably present one of many, in fact. But in order to understand from the local context, where we come from in Kosovo. I think we need to travel back in time since our inception basically. We've been present in the country for nearly 25 years and 2000 the year was. So we're talking about post world Kosovo, so no infrastructure whatsoever and especially within the financial sector, we were the first bank. So we had to build everything from scratch basically. Almost immediately, we were shouldered with immense responsibility. Coincidentally, Kosovo adopted the euro currency at that year. So we had to do the changeover of currency from Deutsche Mark to euro for the entire country basically seamlessly and efficient. So this is the first impact that we encountered in the country. Eriola mentioned earlier, we were the first bank to introduce the debit card in ATM. Now this might sound a bit trivial from today's perspective. But back then, it was definitely very important to establish the infrastructure for the banking sector. We introduced the first e-banking, first time banking, first 24/7 zones, first direct banking concept. All in the name of innovation and technology, driving and pushing forward the innovation in return just to give our clients convenience and efficiency. Now this is in a nutshell our history, so you more or less can get an idea of where we come from. Today, we are a systemic bank, which I don't think that I need any elaboration what the systemic bank means. Of course, we are responsible for ensuring stability and confidence in the banking sector, in the economy as a whole but also confidence with depositors and borrowers. Our assets are EUR 1.1 billion and that will translate to 10% of the total country's GDP. So the magnitude, the size of the bank is definitely -- it has a huge impact on the economy. We are the third largest bank in the country by loan portfolio outstanding. However, we have the largest market share in SME. We are 20%, we have 20% of market share in SME and in fact, this is the vision and the mission in action. Out of the total portfolio of EUR 750 million, roughly, 80% is dedicated to SMEs. And now SMEs, we know the value added. It was discussed this afternoon and customer is no exception. Basically, the SMEs in Kosovo, around about 50,000 active businesses. They provide 76% of total private sector jobs. They provide 80% of value added in the economy. So in Kosovo it's even higher than EU average basically. And we wanted to share with you what's our SMEs, what our clients, in fact, contribute to the society, economy, and the social well-being of the country. We can see in the right hand of the graph here that our SMEs have contributed in 2022 with EUR 500 million in tax and customs. This is 22% of the total budget collected from tax and customs. This clearly indicates the profile of clients that we've been working with year-on-year. By the way, these are most of these clients have been working with us since day 1. And we see an increase year-on-year, 7% to 10%. This is the real impact in action. What sort of jobs do they provide? In fact, how many jobs do they provide? Gian Marco earlier mentioned at the group level. Here, we showed loan and non-loan clients simply because we dedicate our time equally to our loan and non-loan clients as well. 1/3 of the jobs in the business sectors are covered by our SMEs. This is the impact that we've been talking about 25 years, and this is the impact again, in action. And on the last graph, what we wanted to show you is that the country level, exports and imports in Kosovo, exports of goods are roughly EUR 800 million and we captured 30% of total exports through our bank. So we are sizable. We are an important platform not only for the SMEs, but for the entire economy of the country. Similar to that, replicating it also applies to the imports of the country, more than 1/3 going through ProCredit Bank in Kosovo. So as far as the economic and social aspect is concerned, we have a major impact in Kosovo. We also wanted to show some of our other milestones. Now in order for us to have some credibility to discuss sustainability with our customers. Of course, we have to lead by example. And here, we already shared the video, but I also wanted to share some more additional impact-oriented achievements that we've done on milestones rather during the 25 years of our existence. 51% of our electric -- of our vehicles are electric. The rest are hybrid. So we will go fully electric in midterm. We've installed 30 chargers across the country which means that it was open to the public, they are open to the public, charging their vehicles free of charge. So we basically created the infrastructure, which was nonexistent for electric vehicles. Hence, moving away from fossil fuels to electric vehicles. Green suppliers, we deliberately want to show here because this is another example of how do we spill over our sustainability to our -- to the entire ecosystem basically. So there are certain strict criteria of social environment, an aspect that they need to meet in order to become our suppliers. And we reached 51% by number and 80% by volume. And last but not least here, we have the most efficient building in the country, basically. We are the only institution which is with an edge advanced certificate. We've invested more than EUR 2.7 million in the building, just to show and to set an example that this is the way to move forward. On the right-hand side, we show our green portfolio now which is predominantly focused in energy efficiency. Simply because there were no projects of larger scales in Kosovo because there was a lack of strategy, which was recently introduced. And the strategy envisages 1,300 megawatts of new renewable energy until 2031, which is 7 to 8 years from now. Practically, we can translate that into EUR 1 billion investments in 7 years from now. So we already built experience. And we know we've got the know-how, and we are definitely ready to capture some of that some of that potential in the next 7 years for sure. Again, very few fragments we wanted to show you here as a result of increasing awareness and promoting heavily the electric vehicles and rooftop EVs, currently, we enjoy a market share of 45% in electric vehicles and 54% in the total rooftops of our business basically. So this magnitude of the impact would basically not be possible without having a broader business focus, as you rightly pointed out. Now which brings me to your second question. We've always had done a focus on retail, partly due to the history, but partly due to the institutional focus that we had as well. We have a critical mass of retail clients, roughly 55,000 active clients and why they are so important? In fact, this is the core strength of the bank. Well, they give us stability and self-funded liquidity, meaning that we mobilize deposits locally and we place them in a value-added sector in productive sectors as we've seen in the previous slides. But most importantly, they provide us granularity, which was discussed during the afternoon and this gives us stability. Most of these deposits because the retail base is very diverse, I mean diverse in terms of geography, in terms of income, in terms of demography, so hence, granularity is the strongest core strength that we, in fact, have within our bank. 63% of the entire deposit base is current accounts, which means there are non-interest bearing accounts. Hence, this enables us to maintain the low cost of funding, therefore, protect our margins, and this is extremely, extremely crucial for the bank. Now moving on to the risk management. Of course, retail adds diversification as well. And we can see the NPLs historically, PI historically had within our bank lower NPL, which tells us that we can do retail in a prudent and responsible way. But of course, this adds to the diversification of risk management as well. Now once you have all these three elements, obviously, this will translate into profitability and we have delivered double-digit ROE almost every year in the last 3 years, the average of 19% and what's important here, the 22% of profit comes in fact from retail. So again, very important in order to diversify the income of the bank in our country which brings me to your third question. What is the way forward? Well, it was briefly mentioned that we want to become the largest bank by loan portfolio outstanding in the country. Of course, we want to maintain our SME positioning. So we want to consolidate for the SME position there. But we want to add gradually retail clients on board as well. So reposition bank of choice for retail clients as well. And it was already mentioned during the afternoon that opening selective branches or even service points, simply to cater our retail clients and our SME clients in the cities that we are not present. But this is secondary, I would say, primary for us is the focus on new technology. It was again discussed during this afternoon. We will be the first bank to pilot a full digital onboarding, meaning end-to-end, including the digital signature, and this will go live at the end of April. And of course, this will put us ahead of the market. It will give us scale, reaching even the furthest client possible. But this needs to be complemented by other sources of technologies as well, such as new end banking, which is being completely redesigned and adding new features with the main aim to make a more customer-centric approach and customer-centric service basically for our clients. And last but not least is the CRM, which is the sales force, it's a front office, basically, which integrates all of our systems and communicate to each other. So all of our client advisers can have a better view on the client contacting through different and various omnichannels. Now is this possible in midterm to achieve, I would say, absolutely, yes. And why am I so confident? Well, that means that we need to double the number of retail clients, and that will mean onboarding 1,000 clients each month. We're already doing that without additional infrastructure. That means that we need to increase year-on-year, 40% on the loan portfolio. On the last 3 years, we have -- we have grown on the average of 11% so without the additional infrastructure. Once we have the additional infrastructure, we can comfortably reach the 14% average and hence, in the midterm, become the leading bank in the country. Of course, the key pillar, the very foundation is the strong staff that we have, good quality staff, trained staff, which are fueled by purpose and impact. So therefore, once we have the infrastructure, and of course, we have the staff ready to go and conquer the market. So this is the future basically. So with that, I would conclude my part and hand it over to you, Nadine.

Thank you very much, Visar. I mean let's continue with you and have a look at ProCredit for Herzegovina. Also I have a few questions for you. In recent years, ProCredit Bosnia has gone through quite a journey. Can you elaborate on this? And where does ProCredit Bank Bosnia stand today in terms of its positioning? In terms of total assets, ProCredit is a medium-sized bank in Bosnia and Herzegovina. Can you describe what makes the bank unique in the country? And lastly, what is your strategy going forward in terms of balance sheet transformation and achieving scale?

Yes. Okay. Thank you, Nadine, for the question. So our situation is a bit different than ProCredit Bank Kosovo. Having in mind that our total loan portfolio is around EUR 300 million. So in total loans and total assets, we are considered in the market. among smaller banks as well as in the group. So one might rightfully ask what is the importance and impact of our bank in Bosnia. I will say, first, a few words about banking landscape in Bosnia, just for you to get an idea. So they are, in total, 21 banks or 17 banking groups. Total loan portfolio is EUR 12 billion and deposit portfolio, EUR 16 billion. So making a deposit to loan ratio hovering a bit above 130%, our average ROE for the past 5 years is 9.5%. Retail is a very important segment in the market as its share both in loan and deposit portfolio is a bit above 50%. So where does this situation puts ProCredit Bank Bosnia? To see our positioning, we need to zoom in a bit to see where do we stand in our core SME segment at the moment. So here, the information that you are looking at is from PwC benchmark study, independent benchmark study conducted in our market. So we have 14% of total market share in volume of lending in our core SME segment, which makes us the bank #3. And more importantly, in investment loans, we have share of 17.6%, which makes the second biggest bank in the market. At the same time, we have traditionally, if not the lowest, and one of the lowest NPLs in the market. And currently, it is at the level of 1.8%, while the market stands at 4%. Export-oriented companies are in our, I would say, special interest because here, we see the biggest potential for future growth in SME segment. And there, we are happy to report that every fifth practically SME export-oriented company is banking with us. In general, I must say that we are known in the market, and we are well positioned as the bank that offers high-quality service. This we achieved through various things, but I would like to highlight 3. First is expertise. Meaning really understanding our clients' needs, assessing each business individually, understanding business model challenges, opportunities that they are faced with. Second advisory role that our business client advisers have in this segment; and third, speed. What we have to achieve this is highly trained and well-motivated staff as well as scalable and strong IT infrastructure. So in a way, we are known in the market as the bank that has really strong and loyal SME client base. You can see also here information about the house bank principle we mentioned, and we think that average active product per business client is a good indicator, and we have the highest in the market, meaning either we are predominant or the only bank that our SME clients are banking with because we offer a comprehensive set of services that can satisfy all of their in a way needs. And in addition to this, we have the lowest rate of losing the clients. So you can see in the market, it's 6.5% average rate, while with us, it's 1.7%. So what I want to say, I mean, in a nutshell is that we are not just one of many financial institutions providing services for SMEs. We are really trusted, reliable long-term partner in -- for SME companies in our market. I mentioned also when you mentioned as well the impact that we have. I would like to start first putting some figures, facts and figures about the performance of our loan clients in OA. So this is 2019 to 2022. Our loan clients generated 18% more working places or a number of employees while at the same time, the market had 2.5%. They increased revenues for 44% and grew in exports for 49%. So in a way, our loan clients really in many segments outperformed the market and contributed very positively to the overall economy. You need to have in mind in a way the importance of the advisory role that our business client advisers provide for the market because SME companies in Bosnia are formed based on expertise of the owners in their core segment, in their business activities. While at the same time, there is a certain gap in, let's say, financial management in a way. So here, the development is a bit lagging behind. So this important advisory role that our business client advisers have is, in a way, bringing this gap in SME, helping clients to structure properly their loans based on the investment that they have also to provide adequate financial and business planning and so on. Also in digital transformation, we are pioneers in the market. I need to mention that we are present in 6 cities. So we have, in total, 6 outlets from which -- branches from which we are covering the whole country. We are -- with this infrastructure, we are servicing clients even from the most remote parts of the country. And we moved all of our clients towards using digital channels, meaning eBanking and mBanking in their transactional business. It took quite some time. It took quite some effort in a way, but we don't have at all paper orders since practically '18. Also another important topic is green. Green transition in a way. And as having in mind that an energy mix, 70% is participation of fossil fuels. So this really highlights the importance of this topic. We act proactively. So we organized a series of events, providing knowledge about technologies, importance, benefits and so on to not just SME clients, but also private individuals. And we certainly made a push towards these investments. I'm happy to say that in 2022, when these investments started practically booming, we financed 1/3 of total installed capacity in the market for photovoltaics. And in general, this makes us really leader when it comes to green finance as green loan portfolio participation in our total loan portfolio stands at the level of 20.8%. As you mentioned, we've went quite through some journey in the past 4 years. So just a small in a way recap. So historically, we did have strong growth rates of our loan portfolio, but deposit portfolio was not following in a way this line. There was a structural problem in our balance sheet, and that was that our deposit loan ratio was at the level of 66%. So in our total funding structure, we had quite a significant share of borrowings from IFIs and intercompany borrowings. In 2020, we decided to shift focus and go for local deposits in a way to avoid concentration risk, interest rate risk and also to create on liability side, a stable and scalable base for our future growth of loan portfolio. What this meant translated into business, let's say, it meant focusing more on moving away and away from loan seeking towards building really client base and focusing on non-loan clients in the market. So in terms of non-loan clients, we were growing for the past 4 years, we had double-digit growth rates. And practically, we almost doubled the client base for non-loan clients. This, of course, had a very positive impact on our deposit to loan portfolio -- ratio, sorry, and it came from 66% to over 120%. As an effect, you can see that average funding cost decreased from 1.2% to 0.6%. At the same time, we had higher interest income and also noninterest income coming from more clients, more non-loan clients in a way, translated into net interest margin, bringing it from 1.9% to 3.2% in this 4-year period. Of course, this had immense positive impact on profitability and efficiency ratio. So it brought our ROE from minus 3% to 12.2% and cost-income ratio from 100% to 59%. This is not the end of the story, of course, this was important in a way, step for us, but we continue. And now the name of the game is scaling up, working, of course, again, also on balance sheet structure, providing more retail deposits, having more, in a way, granular and stable deposit base, but going for the scale. Just shortly, I will mention these key strategic objectives for a medium term. So in our core SME segment, as I previously mentioned, so we were ranked as bank #3. Our plan is to be the biggest bank in the market. We are very positive and confident to achieve this. This means that we need to grow around 10% on year, which having in mind our track record is really not a novelty. What is important is that even though we are positioned well, there is a lot of market potential, and we have good well trained and very motivated people to do that. We plan also to invest significantly in retail. So our current portfolio in deposits is 1.3 share -- in deposit portfolio is 1.3%. We plan to push it towards 3% as this will also give us in our deposit structure, participation of retail deposits of 50%, which is at the level of the market. We are aligning our offer with what other competitors are offering in terms of the range of products and services, but what we offer in addition is a bit different experience moving more from traditional to modern in a way, digital banking and really focused also on green financing. In terms of profitability, our average profitability for this 4-year period was 4.6%. And in the medium term, we see a standing at 13%. This would be our story.

Thank you very much, Amina. And now to you, Viktor. Also we have three questions. The war against Ukraine continues to be in the public interest, not least because of the inspiring resilience of Ukrainian people. Could you comment on what the war means for the bank as well as for the SMEs you serve? What is the positioning of ProCredit Ukraine and what role does it play in the country? And lastly, what does the update strategy mean for the bank? And how is the bank implementing it?

Thank you, and good afternoon. Well, every family and every business entity in Ukraine have experienced the impact of the war definitely, one way or another. Many experienced direct, including our institution for credit, we experienced direct physical damage. So we had a lot of things to take care of, and there are many challenges we continue to face and adapt to. Of course, some of them I want to cover today, but let me start also with the basic security challenge that we kind of face every day. We incorporated this situation in our daily life. And perhaps by this time of today, you might have heard already that overnight, we had another massive attack more than 30 missiles were launched at Kyiv overnight and these attacks, air alerts, this is something regular. So this is something we live, yes, since already 2 years. And maybe 1.5 years ago or 2 years ago, this type of attack would disrupt most of our activities in the cities. And by now, we learned how to live with this and you can imagine that this morning, everybody wakes up, we've put things together for our kids, send them to schools, to kindergartens and we go to work. So that's the routine. We are at custom. This is very strange. Probably remarkable, but this is something we had to adapt to, and this is our reality. I wanted to show you a couple of pictures here. Just to give you a visual sense of the topics I'm discussing and also attach it to the institution I'm representing. So on the bottom left picture, you see employees of ProCredit Bank sitting in the basement during an air alert or missile attack. So whenever there is a danger outside, our staff goes down to the basement. This is particularly our head office. And you can see probably that we are not sitting hiding only and waiting when the attack is over or alert is over. We are working there. So that's the reality right now. Other pictures, they show the situation we had a year ago. You remember, we had a very big electricity crisis from autumn 2022 until late winter 2023. So that was quite an extreme situation. For days, we didn't have electricity. And the cities and this -- some of the pictures are Kyiv -- represent Kyiv during blackout whatever. It's pretty dark. It sometimes -- it was sometimes depressing. But we learned how to live even with that situation. And the picture -- top right picture shows our branch in Kyiv, which continued to work during the blackout. Of course, we had to quickly adapt to that situation and strengthen our capacity, our bank, other institutions, other entities we have installed generators. We have prepared some redundant electricity lines. So by now, we are much less vulnerable to these kind of threats and problems. The war had, of course, a very big negative impact on the economy. So some numbers are presented here after some positive developments that we had in 2021, there was a big hit on our GDP growth, on our population in 2022. You can see that the drop of GDP was almost 30%. There was a massive outflow of population from the country, and our population is estimated to have decreased from 41 million down to 35 million, and this decrease continued in 2023. Yes. And of course, it was also accompanied by high inflation in 2022. But what I would like to also highlight here is what happens next in 2023 and 2024. Even though the situation continues to be quite extreme, I would say, with a lot of uncertainty, there is already a recovery visible in this year. We have seen already growth of GDP in 2023. There is some expectation then in 2024, we might even see a growth in population. So some part of population who left the country might return. So this -- so our story is not only about negative impact, crisis reduction, but it's a story also about resilience and strength during this period. I put some numbers from very recent surveys done by associations in the country. So we have two major associations, European Business Association, an American Chamber of Commerce that unite a lot of businesses, be it international or local businesses. And the very recent surveys demonstrate that many businesses are operating, first of all, that's already a big achievement. And you can see here that 80% of SMEs indicated they plan to expand and develop already this year which gives us a lot of optimism in terms of survival of our economy and business and, of course, of our role, what we could do in this market. So yes, this is about resilience, strength and actually, I guess, the resilience and strength of Ukrainian population and business explains also why we did not have any major crisis impact on financials on the banking sector in 2022. We didn't have any bank run. We didn't have any major outflow of liquidity. So the banking sector stayed quite strong at that moment. So of course, here, what's important to also describe is where we stand now, what ProCredit Bank mean, what position for ProCredit Bank has in Ukraine. We are #11 by total assets in Ukraine. We have 63 operating banks in this large country. So -- and if we measure only by loan portfolio to businesses to legal entities, we are #9. If -- well, here we have to keep in mind that our competitors or partners in the banking sector, they also grant loans to corporates to private individuals. There is a big portfolio of consumer loans, which we don't have. So if we only -- is a late SME loan portfolio. So we are in leading positions there. That means that we make a lot of sense in the country. We definitely add value to the banking sector and to the market and that we want to maintain and further strengthen. Our quality of loan portfolio is very high compared to the market. It's -- as we assess it, it's some 3x better than the overall banking sector. Here, we have to keep in mind, of course, that a lot of negative contribution comes from state-owned banks, which have a large share in the Ukrainian market. But nevertheless, that demonstrates that our business model and measures which we undertook during the war, they pay off, they lead to a very decent and adequate quality. A lot of -- a big part of population left the country. And in our case, we also lost quite a big part of our employees in 2022 and continue to lose in 2023, but we managed to overcome this outflow. So we managed to hire people. And as of now, we have a number of staff, which is a bit larger than the number we had pre-war. That is a big achievement because we are very demanding in our selection process and our onboarding process. So in this environment, we managed within a relatively short period of time to compensate for that and strengthen our foundation for future development. And here, I also mentioned that we resumed all training programs. So it's not that we had to invent special anti-crisis methods of hiring people, emergency hiring. Now we introduced -- a little bit adopted the typical onboarding program to make it more local. But still, we introduced all the instruments that we used in the past to hire people, to train them, and we also resumed international training programs. So our colleagues are going to academies together with colleagues from other countries, they continue regular trainings. Definitely, we have to be very cautious in our lending operations. And we did -- we reduced our exposure to risk intentionally in 2023 and 2022, of course, and at the same time, we invested a lot to strengthen our liquidity and whatever other risk-related ratios in the bank. So here, one example is that we grew significantly in liquidity. Also, we grew by increasing the volume of deposits from business customers and private clients as well. And by now, we achieved a deposit to loan ratio of 140%. It's a historically highest level we ever had in Ukraine. So taking into account all of these changes that we introduced and the accumulation of additional funds, we created a very strong ground to tackle the current situation and, of course, to grasp opportunities that may come in the future. The last point on this slide is very important. It's about cooperation with international financial institutions. Some examples are provided here that we have very extensive cooperation with EBID, EAB, DFC is about to take place. And with these particular institutions, we recently concluded and expanded risk-sharing programs. These are very important programs nowadays in our case because that allows us to keep adequate risk profile of our loan portfolio, maintain lending, and this is something that we need to expand in the future. Historically, we've been one of the most important partners for international financial institutions in Ukraine. I would even dare to say the first, the key partner in the country. And this close cooperation, we need to maintain, we want to expand so that whenever stability comes in, whenever we have better times, we are fully prepared to seize whatever opportunities the market may offer. And of course, you may imagine the potential of stable Ukraine is huge for us. Let me still give you a couple of examples of our customers as well. We have many stories, many different stories. So here, I just selected two different stories. One story is when the customer went through a very dramatic development and survived and continues to develop and even grow these days. And the other story will be a more I'd say, stable or positive story. Here, we have a small client, which was located in Irpin. You might have heard of this city. This is one of the cities that suffered a lot during the invasion so that part of the city was occupied. There were battles. And of course, there were physical damages to the property of this customer. Particularly much of the goods and turnover was destroyed for this customer. And then when the occupation took place, the customer restored the business. We supported it as an institution. So we continue to maintain loans disbursed to these customers. And later on, we added additional funds so that the customer increases the volume of turnover and goes back to prewar levels of production and sales. And that's already visible in figures. So turnover in 2023 increased compared to the -- yes, unfortunately, it's not mentioned here, but there was a significant drop. And for some time in 2022, the operations did not take place. But this volume of turnover that the client experienced in 2023 is already larger than pre-war volumes of operations. So this is a success story after a very major and dramatic events that were associated with the customer. Another client did not have any major disruption. The opposite. This shows that even in the war time, certain types of businesses may develop and expand their activities. In this particular case, this is a medium customer that produced glass and windows, and after major destructions, actually, this client is located in Kharkiv, in Kyiv, in Minsk, but Kharkiv is one of the regions that is -- that was very heavily attacked and continues to be heavily attacked. So that increased demand, of course, for reconstruction and repair, and that provided the customer the opportunity not only to contribute to the recovery and reconstruction, but also to increase its business volumes. Another very important topic, which I want to quickly highlight is agricultural business. Well, you all know that agricultural business in Ukraine plays a very major role in the country's economy. So it contributes substantially to the GDP of the country, but also it's an export-oriented industry. So that is a major component of export for the country and inflow of foreign currency. So there were multiple challenges for this industry in the past, and we still continue to face some but nevertheless, first of all, our agricultural business lost some land. That was one negative impact. All the uncertainty caused that many -- all agriculture business simply stopped investing in their business. So they stopped buying machinery or equipment, which is still the case. And also, they reduced significantly the investment in agricultural cycles. Less fertilizers, less crop protection means, so that was a negative development, but that was a reaction of agricultural sector to the war and to the situation we had. On the positive side of this, we believe that, that cannot last forever. So that will accumulate additional demand in the future for working capital financing. And definitely, at some point in time, this will bring back the demand for investment loans for which we want to prepare as well. Agricultural business in our particular portfolio comprises almost 50%. And we believe that strategically, this will remain an important industry for us to finance and cooperate with. At the same time, we remember that the export capacity for agricultural sector was significantly reduced in 2023. For most part of the year, we could not really export grain. As a positive remark, I would say, by now, the issue is solved at least as of now. And actually, the volume of export has restored to pre-war levels. This is something that was not expected during 2023. If we go back 1 year ago, one could not really imagine that this issue, this crisis would be solved the way ultimately we see. Therefore, that's another element that we take as a sign of optimism or as a sign of resilience and strength at least. Then, of course, there are a couple of comments about the prices, but by now the prices have stabilized, which is a positive development for agricultural business. Agricultural business became profitable again. Although at the same time, they face businesses, face a higher cost of logistics, of transportation, and this will stay, of course. That means that the margins are different right now. They are much smaller, but still it's a profitable business. So we believe in the future, what it means for us is that our customers will continue to invest in technology so that the effectiveness of their production is higher and that will expand other industries related to agricultural business. So production processing of agricultural goods will definitely develop, and that's what we aim to participate in. So talking about our strategy. Well, to a large extent, we have implemented measures to keep our business under control and keep healthy, profitable business as of now. We fully realize that uncertainty is there, and uncertainty might be very lengthy for years to come. Therefore, the priority was and is to build the business the way that we can be strong, healthy and profitable even if the current situation is not improving significantly, and that's the situation what we see right now. We want to achieve growth, of course. But as has been already mentioned, we have to be cautious with the risk-taking activities at the moment. Therefore, our priority is to maintain current business, which means already a lot of active operations. It's not a frozen activity. We need to maintain relationship with existing customers. We need to refinance them. We need to replace those who disappear with new customers in new loans. So even maintaining loan portfolio at current levels is a big challenge and big business activity for us. So that's in place. But more than that, of course, it's important for us to strengthen the foundation for future development when the right time comes. And we've done a lot in this respect. I've mentioned already staff-wise, we restored our capacity and we strengthened our capacity further. We upgraded technologies and IT infrastructure. And yes. So -- and we'll continue to invest in digitalization, similar to what our other institutions in the group do. When we talk about non-loan business, then we simply remain very active and very operational. And the results we can already report is that we had significant growth of funds from clients, private clients from the retail sector. We had significant growth of funds from business clients. And that is something we will definitely support. That would be my message and report at this time, my discussion. Yes, so thank you. I just return the floor to you, Nadine.

Thank you, Viktor. In particular, for making the long and complicated trip to Frankfurt for today's event. I'm sure the participants here and online, I appreciate it. And I think I speak on behalf of everyone here, when I express my sincere wishes for a bright future for the Ukrainian people. With this, we have come to the end of the Capital Markets Day. And I would hand you over to Hubert for some closing remarks.

Well, ladies and gentlemen, we come to the end of the Capital Markets Day. Before thanking you for your genuine interest in our banking group and for taking the time and being here I indeed want to reiterate what you just started saying, Nadine, I would like to thank our three colleagues, Viktor, Amina and Visar for having explained how our impact -- will impact the economies in which we operate, how much we contribute to the social, economic and environmental development of these countries and nobody could have explained it better what our banking group can contribute than what Viktor just said in the most difficult situation which we have in Europe and how resilient and strong the country was, but in particular, also how resilient and strong our institution was and how much it can contribute to the stability of this economy and this country. And Amina, you very successfully explained how a bank which is small and which is loss-making can be transformed into a profitable, strongly growing bank within a time span of 3 to 4 years, which is also very impressive. And in essence, what Visar explained is how we would like to position the whole group in each and every country. i.e., having a position as a universal bank catering both to SME and to retail clients having these two business lines, which complement each other and contribute to the strength of a bank and the banking group. Therefore, once again, Victor, I'd like to express also in this context, our admiration and our deep respect for you and your colleagues to do what you do so successfully in this difficult context. And for all of you, just to remind you Ukraine contributed positively close to EUR 18 million to our profit of EUR 113 million in the year 2023. Having said that, once again, many thanks to all three of you, I would come to the end of the Capital Markets Day and would just reiterate that we very much thank you for having taken your time for all of the genuine interest which you have in our banking group, we hope that we have been providing as much transparency as possible and that you really understand why this is important to us. We are convinced that we very positively contribute to the development of the countries in which we operate and that indeed we managed to combine that with very attractive returns for our investors. And as we said in the presentation given by my colleagues and myself in the beginning, we want to amplify that impact, and we want to further strengthen and grow our business. Thank you so much.

Thank you again for your participation. As mentioned, if you have any additional questions, please do not hesitate to contact us, The Capital Markets Day is now over. So for the online participants, you may now disconnect.