Good morning, ladies and gentlemen, and thank you for joining our event titled Erste Group and its subsidiaries present their MPE strategy and future MREL issuing needs. This session will explain why Erste Group opted for the multiple point of entry and resolution strategy and give clarity on the MREL issuances of each bank. My name is Thomas Sommerauer. I'm head of investor relations at Erste Group, and I will be your moderator and will guide you through this session today. Our session will last one and a half hours. To make best use of everybody's time, we are going to break this up into three different parts. The first part will be handled by the Group CFO and the Local CFO. The Group CFO will kick it off with an introductory statement. The Local CFO will present their respective country presentations. After each presentation, we will have time for a few country-specific questions for our CFOs and also to lighten it up a little bit, short voting sessions. In this context, I kindly ask you to please post your questions regarding the specific country, during the respective presentation. I will tell you in a second how to vote and how to post your questions. The last part of the event will come from you, the audience, in a CFO panel discussion. We will answer all your questions. Let's do one or two minutes of housekeeping, how it all works. For voting and posting the questions, please use your mobile phone or any other internet-enabled device and scan our conference QR code or open the following webpage. It's www.slido.com/mrel2021. I'm repeating this once again. It's www.slido.com/mrel2021. You also need a password for this one. This is simply MREL, so MREL. You can post your questions by going to the Q&A section. We will go through all of your questions, as I mentioned before, and we will address as many as we obviously can within the time constraints that we have. In case there are any unanswered questions, you don't need to feel short-changed. We will simply supply the answers by email after this event. Let's kick it off by testing the whole voting system, whether it works and whether everybody is on board. This we do with the first trial questions. I think a very timely question, of course. The first question is, how often were you COVID-19 tested in the last 12 months? There are three options, zero times, up to three times, 3x to 10 x, or more than 10 x. Please make your choices. Okay. Okay, there's still some votes coming in. I can see that. 28, 30. The vote is still ongoing. I'm cutting it off here. I think the system works. The majority has voted, or at least the relative majority has voted for up to 3x. It's working. Let's try it once again, maybe, with another question. The question goes, when was your last flight? Three months ago, three to six months ago, or over six months ago. I'm not expecting any big surprises here. I think that's a very clear majority. I'm not waiting for much longer because I think the winning bid, so to say, is over six months ago. Not a really big surprise. It works. I'm happy that you're participating as well. It's a very good sign, just before we go into the deep waters. I'm closing hereby this voting. The winner, as I said, is over six months ago. All right, ladies and gentlemen, this is the warm-up completed then. We will now kick off the session with an introductory statement from Mr. Stefan Dörfler, Chief Financial Officer of Erste Group. Before handing over to Stefan Dörfler, I would like to draw your attention to the disclaimer on page two. Stefan, please go ahead. Good morning, ladies and gentlemen. Thank you very much for your continued interest in Erste Group. I'd like to welcome you to our CEE Investor Day. Again, due to the current circumstances, this will be held as a virtual meeting. Let's all hope that we can soon start with meetings in person again. I guess you're all aware of our footprint in Central Eastern Europe. Erste Group is active in seven geographically connected countries with a direct presence. Additionally, we are present via our savings banks in some more countries. The year 2020, obviously a special one for all of us, was finalized by Erste Group with, I think, a very solid operating result of EUR 2.94 billion, based on a balance sheet of total assets of EUR 277 billion. The net profit, strongly influenced by risk costs, ended up at EUR 783 million. On the next slide, you can see the overview of our resolution groups. All the respective CFOs are here today and are going to present their countries to you. Why is Erste Group going to a multiple point of entry strategy? Our overall strategy is to have sound, self-sufficient local banks. Ideally, they all rank among the top three in the respective country and are able to support the local economy, which is very much the case for all the countries that are presented today. Hence, this rather decentralized governance model was more compatible with the MPE strategy. The banks are all set up as independent entities and are highly capitalized. All the banks are long in their local currency and have very favorable loan-to-deposit ratios. Additionally, there is very strong support for the MPE strategy from the local regulators, and believe me, they really want to be very strong local regulators. Another important aspect of our purpose is to bring prosperity to the CEE region. It's our clear goal as one part and one strong element of this strategy to promote, and in some cases still develop, the local capital markets. We support the local debt capital markets in local currency in the region and have already set several examples with issuance activities in Romania and Croatia, and also in Slovakia, which of course is a euro country. The multi-issuer program was established for standardized international documentation for the issuing entities for local as well as euro sub-benchmark or benchmark transactions. On this slide, you can see a preliminary issuance plan of the MREL issuances in the entities, which will be in local currency, and again, also some of them will have euro needs. That is all for a short introduction from my side. I wish you all an interesting event and hand over to Thomas Sommerauer for housekeeping and our CFOs for their presentation. Enjoy the day, stay healthy, and all the very best. All right. Thanks, Stefan, for this insightful introduction. Obviously now it's time to move to the countries, and the first country we go to will be Slovakia. I hereby welcome Pavel Cetkovský, Chief Financial Officer of SLSP, our Slovakian unit. He will give you also a short presentation detailing interesting facts about SLSP in Slovakia, of course. Take it away, Pavel. Good morning. Let me introduce you to Slovenská sporiteľňa, member of the Erste Group. The name of the bank itself is implicating that the bank is operating in the Slovak market, which is the east part of the Erste Group universe. Slovakia as a country is having population of roughly 5.4 million people, and it is deeply integrated in all European structures, meaning European Union, of course, NATO, and Slovakia is also a member of Eurozone. Slovakia is having good credit standing. It is rated by all three major rating agencies, and it is having single A rating from all of them. With that, I can move further to introducing the bank itself. Slovenská sporiteľňa is dominating retail bank in Slovakia. Slovenská sporiteľňa has 2 million customers, out of which roughly 1.1 million we consider to be active or the primary customers of Slovenská sporiteľňa. The bank as such is representing roughly 10% of the total Erste Group, with total assets of EUR 20.5 billion. On profitability, which was somehow hit by increased provisioning in 2020, we are roughly at EUR 108 million, which translates into 6.5% return on equity in the last year. Slovenská sporiteľňa is having corporate credit rating at the level of A2 by Moody's, and we also have a covered bond program, which is rated by Moody's, and it is rated by AAA. Slovenská sporiteľňa is having market share in Slovakia of about 25%-22% in lending business, depending on what part of the lending portfolio you're looking at. We are having about the same market share in deposits. Slovenská sporiteľňa is dynamically growing in its corporate business in the last three years, and we are keeping our dominant position in retail banking. In retail banking, our major focus and the biggest part of the portfolio is located in mortgage lending. With that, I think we can move a bit to the structure of the balance sheet of Slovenská sporiteľňa, which as I said, is roughly EUR 20.5 billion and it is vastly dominated by the loans, which are representing almost EUR 15 billion. Slovenská sporiteľňa is primarily funded by the retail deposits, and the loan-to-deposit ratio of Slovenská sporiteľňa stands at roughly 100%. Last year, Slovenská sporiteľňa took some additional funding from the ECB in the form of TLTRO program. We participated in roughly EUR 1.5 billion TLTRO. However, this program, we did not take as a primary source of funding. We took it more or less as opportunity to, A, increase our liquidity ratios, and B, to support our net interest income, thanks to the fact that the program is very attractive from the pricing perspective. If I move to the development of the operating result of Slovenská sporiteľňa in the last year. I already mentioned that 2020 was specific year due to the fact that the bank was in the need to create additional provisioning. The provisioning was not actually driven by the fact that we would be witnessing increased number of defaults, both from the retail as well as the corporate segment. The forward-looking provisioning required that we try to estimate the level of provisioning we would need in the years to come. The problem of 2020 from the risk management perspective was the existence of private moratoria and the public moratoria, which basically gave any customer with the potential payment difficulties, to take moratoria and stop payments for up to nine months. If you look on the level of provisioning in 2020, one can say that we created 2.5 x more provisions than we did in 2019, as well as in the previous years. For comparison, in basis points, it means that the risk cost in Slovenská sporiteľňa in 2020 were at a level of 72 basis points, while in 2019 we saw a level of 30 basis points in average risk costs. With that, I think I can also comment overall profitability, which was impacted by existence of the banking levy in Slovakia. Also as a part of negotiations with the government, with the specific COVID situation in Slovakia, there was agreement reached between the government and the banks that the bank levy as such, will not be existing any longer. The bank levy was canceled. Currently there is no bank levy applied in Slovakia. Just for giving you some feeling about how much money it represented in the year 2020, we paid roughly EUR 36 million in the bank levy. This cost is going to be out of our P&L for 2021 and further on. If you look on the capital position of Slovenská sporiteľňa, the bank is quite well capitalized. We are running a total capital ratio at 18.6%, and we are having core equity Tier 1 ratio at a level of 14.5%. With that, we are compliant with all regulatory requirements by the National Bank of Slovakia. It is also obviously reflected in the quite fine credit rating of Slovenská sporiteľňa by Moody's. I already mentioned that Slovenská sporiteľňa is the bank, which is primary financed by the deposits. We have also some, let's say, speculative ECB financing. Nevertheless, we are subjected to MREL requirements by SRB. This is one of the reasons we need to go to the market and issue MREL eligible instruments. In our case, it will be mostly senior preferred bonds. We think, and our projections are saying us, that if we issue something between EUR 100 million and EUR 300 million annually, we will be gradually building up the MREL ratio to the level requested by the regulation, which in case of Slovenská sporiteľňa, requires 28.6% of risk-weighted assets being covered by these eligible instruments. We also assume that in 2021, we will go to the market with the first tranche of green bonds. At least we still have it in our plans and the budget. Of course, the final decision will be quite dependent on, A, business development, and B, on the monetary policy of ECB, particularly in terms of further existence of TLTRO. With that, I think I can stop my presentation of Slovenská sporiteľňa, and I'm happy to take any questions you might possibly have. Just heard that we had a small sound problem. Thanks, Pavel, again for sharing your insights about Slovenska and Slovakia, of course. Before coming to you and answering questions of the audience, we will do a short voting session again, and the next poll question that is: Looking at Slovenská sporiteľňa, in which asset class might you invest in? The options would be covered bonds, senior preferred bonds, or senior non-preferred bonds, or as a fourth option, in all of the above categories. We can see the votes coming in. Seems to be a good level of interest from what I can judge here. It's almost a tie, I would say, between senior preferred and whatever Slovenska has to offer, basically. I think it's a comfortable situation for the CFO to be in. I think we can see the results now. Okay. I think we can close the voting. I think, as I mentioned before, it's more or less a tie between senior preferred and all of the above categories. All right. Hi, Pavel. Good to see you live as well. In terms of question, unsurprisingly, we have got a question on ESG, which seems to be the topic of the day, not just in Austria, but almost globally. How do you see the topic for you? What opportunities do you expect from it, or how do you prepare to basically be a ESG frontrunner? Well, I don't know about frontrunner. In any case, I think we are now kind of putting together a program. I would like to stress that ESG is a new topic from the framework perspective. I don't see it so much new topic from perspective of individual components of it. For instance, this green bond program I was mentioning that we have prepared, was established long before the ESG as a framework become to be so often quoted and asked about. Yes, we are working on it. We are kind of structuring the program, but many components are already existing, and I think still there is plenty of work to be done, especially on rating of customer loan portfolio vis-à-vis the environmental objectives. Okay, Pavel. Thank you very much. I think that's it for the time being, I think at the end of the panel section, we will definitely have some more question for you, I would guess. Hang in there, stay with us, and we are now moving on to the next country, which is Croatia, of course. I would like to introduce to you Krešimir Barić, who is Chief Financial Officer of Erste Bank Croatia. He, in turn, will introduce you to the Croatian way of MREL issuance, and I hand over to him straight away. Please, Krešimir, give us an introduction into MREL the Croatian way. I've been working in Erste & Steiermärkische Bank Croatia for the last 15 years, and I'm very proud of the path we shared so far. As for the beginning, to describe Erste, I have to say we have the stable and growing operations, even in the times of the COVID crisis. Strong capitalization and high liquidity. Leading position in digital innovation on the local market. Strongest client satisfaction position, placed number one on the market. Active role in society. Let's start with a short overview. Our bottom line financial result in 2020, due to the impact of the COVID situation and significant effect of the risk cost, was understandably reduced due to front-loading of the risk cost following EBA guidelines without NPL growth year-over-year. However, our business operations remained completely stable. Despite COVID-19 influenced our operating income, leading to the lower net commission income and trading result year-over-year, due to the absence of the tourist season and keeping a stable net interest income. We maintained the continuity of our regular lending activity. We achieved record deposit level on both sides, retail and corporate, having balanced loan deposit ratio. We further developed our digital solutions as a trademark of our bank, as well as the entire Erste Group in the CE region. As a systemically important institution, we took a proactive and socially responsible role at the very beginning of the COVID-19 crisis. We established a set of activities we carried out to the support of our clients, falling into the three key phases. Temporary suspension of a forced collection measures, opt-in moratoria for up to six months or up to 12 months for the clients from industries mostly affected by the crisis, such as tourism and dependent activities. Loans aiming to preserve the liquidity of the business entities with adequate guarantee schemes and favorable financing conditions. Finally, the synergy of business, communication and social responsible activities in 2020 was rounded up with a contribution to the community through the donation initiatives to healthcare institutions. Furthermore, additionally, in total amount of 2 million HRK from local bank and our shareholders, we directed towards cities and municipalities that suffered two strongest earthquakes in the last 140 years, causing large infrastructural damage. We have successfully passed the comprehensive assessment conducted by the European Central Bank, comprising AQR and stress test. We were ranked second among five of our Croatian banks participating in the process. It was another confirmation of our solid and stable operating model. On the other hand, it should be also seen as a significant signal of the quality of the whole Croatian banking sector, which represents a strong pillar of the recovery of Croatian economy and further Croatian way to the Eurozone. We are grateful for the fact that the renowned credit rating agency, Fitch Ratings, affirmed our credit rating at BBB+ with a stable outlook. This is an investment grade rating, two levels above the one currently held by the Republic of Croatia, at the same time representing the highest rating of any bank on the Croatian market. We received our seventh Golden Kuna award, which is presented by the Croatian Chamber of Economy to the most successful bank on Croatian market in year 2020. We perceive the award as a significant recognition, not just of the quality of our business, but also of our active role in the development of Croatia's economy and fostering the prosperity of the entire community. Our capital position has remained strong despite of the pandemic and well above minimum requirements with CET1 of 17.5% and total capital ratio of 18.7%. Croatia is today a member of the banking union and has entered into the pre-euro exchange rate mechanism, ERM II. Accordingly, the SRB has become the resolution authority. Further to that, Erste has had no binding MREL target under BRRD 1. We expect to receive our first MREL binding target under the BRRD 2 in the first half 2021. Nevertheless, our current MREL capacity is already significant, while our funding plan already reflects the draft joint decision on MREL determination. Having said that, we successfully completed a EUR 45 million worth bond issue, the first one on Croatian market, eligible under the Minimum Requirement for Own Funds and Eligible Liabilities. Other than regulatory compliance, we have successfully achieved two additional goals: an adequate diversification of our financial resources and an appropriate contribution to the further development of Croatian capital market, in which our bank has been in the forefront in recent years. To continue on funding plans, in 2021, we plan a potential in euro international transaction in senior preferred format and sub-benchmark size. In the upcoming years, in an average yearly MREL issuance plan in amount of EUR 200 million-EUR 350 million is envisaged. Is there a way to shortly sum up the expectations for the future period? If so, I would conclude as follows: The period ahead will be very challenging and will primarily depend on the impact of the epidemiological situation on the overall Croatian economy. However, there are several positive elements that can be singled out when it comes to the Croatian economy's long term position. For example, certain improvements can be seen when it comes to improving the general investment climate in Croatia and stabilization of public finances, which has also been recognized by the international credit rating agencies. Joining the exchange rate mechanism puts Croatia one step closer to the adoption of the euro. That is, to achieving a strategic goal that will contribute to the long-term financing stability for citizens and overall economy. A positive grade in the process of the European Central Bank's comprehensive evaluation and confirmation of Croatian banking system stability is encouraging, not only when it comes to the contribution to the euro adoption process, but also in the context of the challenges with which Croatian economy is currently faced. The banks in Croatia will play an extremely important role in that regard because Croatia's robust, strong, and adequately capitalized banking sector will serve as the backbone in the process of creating new economic growth. Through a joint coordinated approach of all stakeholders, Croatia can overcome the current challenges and minimize all their potential negative impacts. We will continue to put a strong focus on digital innovations of our business with the goal to stay a frontrunner of digital innovations on Croatian market. We will continue to successfully monitor and manage our loan portfolio in line with the highest credit risk management standards. At the same time, we will respect all regulatory rules and adopt a balanced approach that respects the objective of the market situation and needs of our clients. We will further proceed with the integration process of our current business. We will continue to be an active partner in seeking adequate solution that will enable the fastest recovery of Croatian economy. Finally, we will put a strong emphasis on further develop our policies when it comes to the community overall. Considering our way of doing business and impacting society, we have identified six fundamental sustainable development goals to which we want to contribute. Our end goal is to foster prosperity of our clients, of our employees, and of society as a whole. Well, thanks, Krešimir, for this great introduction to Erste Bank Croatia and Croatia, of course. Before we come to you and before we have a question from the audience, obviously, we do another round of voting, and we have prepared one question for the audience, one poll question that is. I would read it out if I can see it on the screen. Yeah. The question is: would you require a euro benchmark transaction volume in order to be able to invest? You can see the three options in front of you. Benchmark size required, benchmark size preferred, or no preference whatsoever. Let's give ourselves maybe a minute or so that we can have a result. Okay. I think we have a clear leader in the meantime, which is a preference for a benchmark size, so a EUR 500 million plus transaction. Yeah, the lead is building as we speak. All right. Good. Okay. I think the winner is clear from your votes, based on your votes. Benchmark size leads by 72%. H i, Krešimir, from Vienna. Let's see whether we get a question. Hello from Zagreb. Do we get a question? Oh, yes. Here it is. We have a question. It's about, unsurprisingly, ERM II, Exchange Rate Mechanism II. The unsurprising add-on question is: when do you expect the euro to come eventually to Croatia? Okay. Thank you for the question. Well, joining the ERM II, we are one step closer to the adoption of the euro, and for sure the strategic goal is that this will contribute to the long-term financial stability of the citizens of Croatia, but also the overall economy. We see for sure from perspective that we would achieve a better stability, but also reducing the, I would say, currency exchange rate risk in Croatia. However, there will be the effect also on profitability of financial system. Croatian National Bank was communicating potential benefits and costs of the adoption of the euro in Croatia, and some of the benefits would be, for sure, this elimination of the currency risk from the economy and also a reduction of the borrowing costs for domestic sector. Lower transaction costs. There will be also the stimulus to international trade and investments, like all other countries that joined the monetary union. However, there were also a prediction of some costs and losses are predominantly of the independence of the monetary policy after joining the monetary union. Increase in price levels due to the conversion, we consider there would be a milder effect. There will also be some one-off changeover costs and for sure, we would also participate in providing financial assistance to the other European Union members. At this point of time, I would say, it's not easy to say and predict when will be the timing. Everything is set according to the national plan that has been built, that adoption would be 1st January 2023, this would be the soonest possible date. We are aiming to that, but let's see how the pandemic will evolve, and based on that, it might come that the adoption would be later. Okay. Thank you, Krešimir. I can see that we have received a second question as well, and I would be happily reading it out to you if it would not be blurred on my end. If you can see it. Yes, I can see it. Yeah. I think it's about the Recovery and Resilience Facility, how it will support the Croatian recovery, if I can make it out correctly. Maybe you can help me out here if you are seeing it better. I see the question. Well, referring to that, this time compared to the 2008 and 2009, this recovery and resilience fund will provide an important counter-cyclical capacity, especially for the supporting of fiscal potential, which is now scarce due to the public debt is significantly higher due to the COVID-19 impact. However, the stronger than E.U. average GDP contraction we had in Croatia can in large extent be contributed to the exposure of tourism. Down the road, it's reasonable that we expect gradual normalization and above potential GDP growth rates. Though we should highlight that how we use the funds potential would determine the longer run growth. We should spend towards more long-term gains, and this would make more sense compared to traditional infrastructure spending till now. For sure, the basic precondition of the National Recovery and Resilience Plan is that we present to the European Commission the plan, which will be end of April. I'm sure that the focus on fostering structural reforms and also support SME client projects would be crucial to be supported. Okay. Thank you, Krešimir. I think we leave it at this for the time being, and then we return, obviously, at the very end of this session, hopefully with some more questions for you. Thank you very much to Zagreb and to Krešimir. Now it's time to move to another country. Of course, we now move to Prague, to the Czech Republic, and to Wolfgang Schopf, who is Local Chief Financial Officer at Česká spořitelna. I would hand over to him now for a brief introduction on Česká spořitelna and the Czech Republic. Welcome, ladies and gentlemen. Thanks for your interest in Česká spořitelna and the Czech Republic. I want to brief you about the bank and the country. Let's start with the country. 10.7 million inhabitants in the heart of Europe. Since 2004, member of the European Union. Since 2007, member of the Schengen Area. If you ask me if Czech Republic would move to the Eurozone early and soon, no, this will not be the case. If we look at the macro numbers, 2020 ended at -5.6. The outlook for this year is rather positive, being between 3.5%-4%. Of course, the disclaimer is always what will happen with the pandemic in this country. Inflation is at 3.2% for the year 2020. Current numbers for February are 2.1%. The unemployment might rise this year towards 4.5%, towards 5%, but still under the best of the European countries. The public debt is at 43.7%, which is fantastic in the European context, and I perceive it still as enough firepower for the government to bring this country through the economic crisis. Let's have a look at Česká spořitelna. We are in very many areas, a market leader. Is it mortgage lending? Is it consumer lending? Is it asset management or deposit gathering? We run our business with 430 branches. We are the largest commercial bank here, serving 4.5 million clients. There is another phenomenon, that the four biggest banks here in the country cover 70%-75% of the market potential. Total assets are at EUR 58.6. The net profit for 2020 is reported at EUR 380 million. What is relevant is, and we will look at it later on, the operating performance and the risk coverage, but I will talk about later. If you look at the balance sheet performance, in euro terms, there is a bit of a disruption of the translation effect from Czech koruna into euros. Our loan book in local currency has grown almost by 4%. Unexpected positive surprise was the loan growth in mortgage lending. Otherwise, we have grown like the market. In the corporate business, I think the corporate clients were hesitant in 2020 to invest, so the portfolio growth is rather flattish. Customer deposits, we have seen growth and deposit income above all expectations. In total, in local currency, our deposit base has grown by 10.4%. There is one consequence out of it, that our loan-to-deposit ratio is now below 70%. If we look at the operating performance of Česká spořitelna, of course, massive impact from the COVID-19 crisis, I have to say. Our operating result declined by 9.5% in euro terms. By below 7% in Czech koruna terms. We were hit by the fast reduction of interest rates by the Czech National Bank. We placed a lot of money with the Czech National Bank, we moved from 225 basis points to 25 basis points. We got a hit on the fee income as there was no public entertainment, public travel allowed in 2020. What we could do is, we could manage down our costs by 4.2% in euro terms or 1.3% in local currency, is it in PEREX, is it in operating expenses. We were able to compensate to a large extent the negative impact we had to accept on the operating income. The cost-income ratio ended up at 47.6%. Now the net profit is reported at EUR 378 million. We booked more than EUR 300 million in risk provisions. This translates into 96 basis points related to the loan book, and we are confident that this will help us through 2021 as well. Our NPL coverage is 115%, and our NPL stock as of year-end 2020 is 2.2%. Our return on equity, of course, is a bit squeezed by the net profit, but as well by our strong capital position, which I will talk about in a second. Our capital ratio, total capital ratio is at 25.6% at the year-end 2020. Our quarter one ratio is at 21.6%. It's influenced, of course, by the ban from the Czech National Bank to distribute dividends. We didn't distribute anything from 2019 profit, nothing from 2020. We are in permanent discussion with the Czech National Bank, but they will clearly follow guidances from European regulators. Now, we have chosen the MPE approach. We are, so to say, a Czech resolution group. It's Česká spořitelna. The most relevant subsidiary of Česká spořitelna is a mortgage saving, mortgage lending subsidiary. We form the most relevant piece of the resolution group. We got the requirement from the Czech National Bank for full subordination. Our MREL target is calculated de facto on the risk-related asset development. Our final MREL target for 2024 is 25.1%. Might fluctuate, might be adaptive. We will see during this year. It pushes us to do something, in addition to cover the MREL requirements. Our funding plans is, for this year, we want to go to the market with a EUR 500 million senior non-preferred issue. For the next years, until year-end 2023, we expect an issuance of EUR 400 million- EUR 500 million equivalent. All kind of products which will help us to cover the MREL requirements. We are under the group's multi-issuer program. The governing law is the Czech law and the German law, and we plan a listing on the Prague Stock Exchange and the Vienna Stock Exchange. To conclude on it, the Czech Republic and the banking system in the Czech Republic is still extremely resilient. This is even confirmed by the Czech National Bank. Česká spořitelna is capital rich, liquidity long, but we have to cover our MREL requirements, and we are happy to tap the market, and we invite you to join us on this. Thanks for your attention. Bye-bye. Thank you, Wolfgang, for this great introduction to Česká, and obviously also to the Czech Republic as well. Before we come to you with the first question, obviously we do another round of voting, and I would kindly ask for the voting, the polling question to be shown. Okay. I see we have the first question for you, but I think we have to do the voting, yeah. Okay. The voting question for Česká is, for an NPS Europe benchmark issue from Česká, how many ratings would you need? Minimum one, minimum two, or minimum three? Yeah, I think unsurprisingly, we have already an early front runner, but let's wait, maybe. There you go. Yeah, I think the minimum one is still in the lead, consolidating its lead, actually. Okay. I think I'm closing this. The result is fairly evident and fairly clear. I turn to Wolfgang now. First of all, welcome. It's good to see you. Good morning. Almost in person, I'm tempted to say. Let's be happy that we can see at least each other on the video. Yes, I would go for the first audience question, which is, will the dividend payment restriction from the CNB remain in place for 2021? Yeah, thank you very much for the question. We just got, last week, updated information, official information from the Czech National Bank. They will undergo a decent review of our capital risk position, forward-looking efforts during the next couple of months. We have to deliver audited results during summer. They will do their homework, will make homework with us. In their statement, they say, in autumn, they will take a decision. They gave us four indicators where they see limitations. It can be risk-weighted assets, it can be other risk-relevant ratios. We have more or less clearance. In autumn, there will be the opportunity to distribute dividends. Let's see how much it will be, and I hope that this time we can keep it and say in autumn we have a decision about it. I think everybody will be happy in Vienna about this input. We would be happy in Prague as well. In Prague as well, of course. If there is no further questions at this time, which I think is the case, I would leave it at this with you, Wolfgang, for the time being, and come back to you at the end of the session. Thank you very much to you, Wolfgang, and thanks to Prague. We are now moving to Romania. Of course, Elke Meier is Chief Financial Officer at Banca Comercială Română, our Romanian subsidiary. As the other gentleman before, she will give you an introduction into the bank and into the country. Elke, take it away, please. Dear partners, both the society and business environment have changed dramatically in the last year, and most importantly is that the Romanian economy managed to adapt rapidly to the new reality. Adaptability and resilience were the key words of this pandemic. The banking sector has played a strategic role in providing financing for both companies and individuals, supporting the government initiatives by state guarantees in keeping the economy on the right track. GDP growth outperformed CE peers, and in the last quarter of the year, after the underperformance in the third quarter, likely backed by sizable fiscal stimulus focused on investments. The central bank eased its policy stance during 2020, though RON still offers a significant yield pickup versus CE peers, as currency stability is having an important weight in NBR reaction function. Large inflows of E.U. funds are expected on the medium-term horizon and should support growth momentum, with 2021-2024 annual real GDP growth likely average at 4.5%-5%. Fiscal consolidation is already underway and should accelerate once the economy recovers. Reforms are needed to rebalance the structure of the public expenditure. The banking sector has fueled the economy, reaching an increase by 6.4% in gross loans in 2020, retail and corporate segments. Romanians have paid more attention to their financial health. As a result, customer deposits have increased by 15%. Learning from previous economic crises, banks have taken the correct prudent measures in order to ensure the stability of the sector. Romania will register a slower advance in retail loan stock due to lower wage hikes in 2021, while corporate outstanding loans are expected to expand by low single digits. Banks have built significant capital buffers, allowing them to absorb economic shocks without tightening credit conditions. What was our approach in 2020? We achieved extraordinary things, reinventing banking on fast-forward and staying united. We were fully open for business, being a reliable partner for entrepreneurs and companies in their efforts to ensure jobs continuity. We continued to be a leader in local currency lending to private individuals. BCR accounts for about 20% of the mortgage lending in Romania, capitalizing on its strong expertise in this area. We also gained market share in consumer and corporate lending. The stability of our customer deposits showed continuous strong confidence in BCR's financial soundness and strength, as well as in our ability to support wealth creation through a wide range of financial investment opportunities. We achieved a good bottom-line result despite the forward-looking risk provisioning books. We have improved our operating performance due to continuous digital transformation and loan growth. BCR also managed to lower its cost base in 2020, becoming one of the most efficient banks in Romania. The capital position improved over the last years in preparation for upcoming MREL requirement. Amortization and repayment of Tier 2 instruments has been replaced by higher-quality CET1 generated by profit capitalization. Strong capital allows for long-term business growth while capital ratios remain comfortably above minimum requirements. Going forward, BCR aims to recapture market share, especially for private individuals and SMEs. One of the key means is to activate and deepen the share of wallet with our existing 3 million client base through a new advisory approach, simplified and digitized customer journeys. The preferred resolution strategy for Erste Group is an MPE strategy, multiple point of entry, and BCR Group is forming a separate resolution group under which the point of entry for resolution is BCR Bank. In this case, BCR must issue external MREL-eligible liabilities. What are our funding plans and our MREL strategy? In December 2019, BCR pioneered by issuing the first RON senior non-preferred benchmark, not only for Romania but in CE. Please allow me to remind those of you who attended our events from November, December 2019, that we have managed to have the deal coming to market despite the uncertainty about the MREL requirements and the Bank Creditor Hierarchy Directive in local transposition. The transaction was highly successful on the back of a strong demand from investors. The bank decided to tap the market with a RON 600 million, seven-year issue, up from RON 500 million at the 90-basis-point spread over Romanian government bonds. The investor distribution was well-balanced between asset managers, pension funds, insurance companies, and also EBRD. The total volume of bond issuance planned for 2021 is around EUR 300 million, to be issued in RON, which means roughly RON 1.5 billion. We will use a mix of senior preferred and senior non-preferred instruments. BCR is a resilient bank with an optimized balance sheet structure and a healthy business model. We strive to live by our purpose to support the real economy, promote financial education, and bring prosperity to our customers. Thank you. Thanks, Elke, for this great introduction. Welcome from Vienna. Hello to Bucharest, of course. Before we come to you and before we have the first audience question, we do our usual routine in the meantime. We have the next polling question. We are asking the audience now, would you possibly invest in a local currency denominated, so that's a RON, Romanian lei-denominated benchmark? The options are yes, the second option is no, and the third option is yes, if there would be a euro currency swap provided with this facility. Let's give ourselves one or two, maybe not minutes, but maybe 10 or 20 seconds to see what we can get a clear leader here. I think the local currency version is in the lead currently, but it's a tightening race. Okay, it's almost a tie now. Is a tie. I think we can close it, Elke. I think the local currency option is a real possibility. Investors are interested in that. Thank you very much to the audience again for participating in this poll. Let's see whether we have the first question for you. I think we have even two questions. If I can read this out correctly, the question is obviously with the issuance in 2019 that you were referring to already in your presentation. The question would be whether it's MREL eligible. Good afternoon, because in Romania it's already after lunchtime. From my side to everybody, yes, the issue which we did in 2019 is MREL eligible under the current framework. Yes, the answer is a clear yes. Regarding the second question, what I can see here, the MREL target in terms of percentage of RWA, we have received last year an indicative target from the National Bank of Romania, and it's near to 30% of RWAs. Okay. Thanks, Elke, for helping me out here and reading out the question as well, as well as answering it. Sorry. No, it's all good. It makes it easier for me because sometimes my screen is a little bit blurred, so I'm happy for every support I get. Elke, thanks very much for the time being. Thank you. The two questions we had, and obviously we'll revert back to you as soon as sort of the final country presentation is finished. Goodbye and talk to you later. Thank you. Bye-bye. Bye-bye. This takes me to the next country, and that would be Hungary, and our CFO in Hungary is Ivan Vondra. Hungarian presence was almost one of the first presences that we had in CEE right from 1997, before we even expanded into Czech Republic and Slovakia and so on in a meaningful way. I obviously don't want to eat Ivan's lunch, so he will give you a good introduction to both the country and the bank, Erste Bank Hungary, and I would hand over with this to Ivan. Ladies and gentlemen, a very warm welcome from my side. It's great to have you here today. My name is Ivan Vondra. I am a CFO in Erste Bank Hungary, and today I will walk you through the preliminary results of 2020, and I would like to give you a flavor about our MREL issuance. Before we go to the agenda, let me just briefly talk about Hungary. Hungary is a country in Europe having basically roughly 10 million inhabitants. GDP per capita is roughly EUR 13.3 thousand. What concerns the credit rating, it's Baa3 with positive outlook and triple B with stable outlook. The capital city is Budapest. At the bottom of this slide, you can see a roadmap, a convergence roadmap or transition roadmap, if you want, about conversion from the communistic country to the membership of E.U. Erste Bank Hungary is the second-largest lender on Hungarian market. Erste Bank entered the Hungarian market in 1997 and become one of the main players on the banking market. On the right side of upper part of this graph, you can see the market participants. What is typical for Hungarian market is that OTP has very dominant position, but you can see that Erste Bank Hungary is basically positioned very well. What concerns the shareholder structure of Erste Bank Hungary, we have three shareholders. The main shareholder is Erste Group, having 70%, and the other minority shareholders are EBRD and the Hungarian government, or Hungarian state, having 15% stake each. Let me give you just a couple of numbers, and those are the key numbers from year 2020. Please take or bear in mind that those are still preliminary numbers. In 2020, we reached total assets of EUR 10 billion. The bottom line was EUR 65 million. NPL coverage, 109%. NPL ratio 3.1%. CET1 ratio 16.6%. Total capital ratio nearly 20%. Loan to deposit above 65%. ROE 5.6. Cost to income ratio 48.5%. I will give you a flavor of those numbers or breakdown of those numbers on the following slides. Let me start with the balance sheet performance. In local currency, meaning in HUF, the loan growth reached 11.5% year-on-year. If we break it down into the segments, in retail segment, the loan growth was 17.3%. In the corporate segment, we reached 9.5% year-on-year growth in local currency. Moving to customer deposits, we recorded really a huge increase year-on-year, nearly 25% of customer deposits in flow. Again, breaking it down into the segments, in retail it was 22%. In corporate it was more than 30%. Let's move to the operating result and the bottom line. We are very proud of the fact that we managed to grow our operating result over the last four years. In local currency between 2019 and 2020, we managed to achieve marginal growth of 1.2%, which if you take the result in light of the pandemic situation is, we believe, really extraordinary achievement. Talking about the main contributors to that development of operating result, we have to mention core earnings, meaning net interest income and fee income. Cost to income ratio slightly deteriorated between 2019 and 2020, and this was basically a result of a bit higher expenses and IT investment. What concerns the bottom line, what you can see on the right side of this slide is a very similar picture, meaning that we managed to increase the bottom line starting from 2017 until the 2019. 2020, basically, as you can see, is reaching 65, is substantially lower than in the previous years, but this is purely because of the pandemic situation. Let me briefly talk about our capital position. We are well capitalized. That's the main message. EBH capital position has been stable in the previous years. Again, the CET ratio reached 16.6%, total capital ratio close to 20%. Capital adequacy was overall well respected above all the limits. Now, the main part of my presentation, the MREL requirements. You have heard already from the previous speakers that we are part of the MPE approach. Hungarian Resolution Group consists from two main entities. It's basically the bank itself, its investment company. There are other non-relevant entities like building society, mortgage bank and real estate company. Concerning the MREL under BRRD 1 at the year-end 2020, the capacity was 19.7%. MREL requirement was, at that point of time, 26.6%. It is fair to say that the MREL requirement is still subject to further discussion with the National Bank and will be updated in our plan in the first half of 2021. The funding plans. The funding plan for 2021 will have senior preferred bond issuance. The yearly issuance for 2021, we assume it will be at around EUR 200 million or Hungarian forints. What concerns the program summary beyond 2021, we assume that there will be debt issuance equaling yearly to HUF 100 billion/EUR 200 million. The governing law for the issuance will be Hungarian law, and we plan to launch it on Budapest Stock Exchange. Ladies and gentlemen, thank you for your attention, and I hope you will join. Thank you. Okay. Thanks, Ivan, for this presentation on Hungary and Erste Bank Hungary and what you're up to in terms of MREL in the future. In the meantime, I got used to asking the polling question. Before asking you the question, I will do the polling once again. We've prepared the following question for our audience, which is looking at the Erste Bank Hungary, in which asset class might you invest in? The senior preferred, senior non-preferred, or both. Please vote now. Okay. It's very reassuring so far for you, Ivan. Yep. Very good. Yeah. You can issue whatever you want. They will take it, hopefully. Let's see, depending on the pricing, I guess. Good. Okay, maybe let's wait. Let's give ourselves another couple of seconds, and then we see what the result is. Senior preferred is coming up a little bit now. I think the trends are clear, so I don't want to waste anybody's time here. Investors would be happy to invest both in senior preferred and senior non-preferred. I think that's the good news. Now let's see whether we have any questions from the audience for you, and I think we have. Yes, whether you intend to issue on the domestic or on the international markets? Right. Got it. As I mentioned previously, the final MREL requirement is still to be determined, ideally in the first half of this year. That's why we would like to keep both options on the table, so to say, meaning having an issuance in a domestic/Hungarian forint or in euro. It will definitely depend on the final capacity. Yeah, both options are in a place, so to say. Okay. Thank you, Ivan. I think with this, we have at this particular moment no further questions for you. We can move straight to our panel Q&A section, which I hereby do because I see we are also running out of time rapidly. It's another 10 minutes that we are scheduled to be on air. Yes, before obviously going into the panel, maybe a little bit of housekeeping. If you have questions to the respective CFOs, then please go to the Slido app, either on an internet-enabled device or on your mobile phone, and type in those questions, and we would be very grateful if you also make clear to whom the question is directed, to which country or to which CFO. Whatever will then allocate accordingly. Yes, before doing the first questions, let's do a final voting again to give you maybe a little bit more time to post your questions. The final poll question for the day would be, how much time would you need to evaluate or get internal limit approvals for our new issuers in the group? Is it less than three working days, three to five working days, or more than five working days? Let's wait a little bit longer because the number of participants is just rising slowly. While we see the votes coming in, I would like to once again draw your attention to Slido. If you are logged into the Slido app or on your web browser, you can go to the Q&A section and post your question there. If you do that, it would be very helpful if it's a short and crisp question, and if you make clear to whom this question is directed. I think it's a tight race. It's actually not a tight race, it's a tie. I think the consensus here is that anything between 3-5 and more than five working days are necessary to get the internal approvals for an investment in the respective subsidiary bonds. All right. Okay. With this, I think we can move to the panel Q&A because time is rapidly running out. This is, once again, a little bit of a challenge for me to read out. I can see the first question presumably is related to BCR. Okay. Yeah. I think, Elke, that's for you, and the question, of course, is whether you are considering or whether your future plans for issuing green sustainable bonds. Thank you very much for this question. Yes, we do think about issuing green or respectively sustainable bonds, b ecause there was a question before to Pavel on the ESG, we are having it quite embedded in our strategy. With this, we think we are able, probably not this year, maybe towards the end, but most definitely next year, to be able to issue green or sustainable bonds. Okay. Thank you, Elke. That's very clear. The next question is related to Hungary. How do you see local capital market capacity to meet Erste Bank needs on MREL alongside other banks? I think, Ivan, that's for you. Yeah. Thank you for the question. We are quite confident about the capacities of Hungarian market. In the first wave, we are talking about EUR 200 million, and honestly, we have a locally very experienced team, which basically ran a program of local programs for issuance. Yeah, we are quite confident that, for the first wave, this will be sufficient. For upcoming years, again, we are considering international issues as well. I think the mix of local and international is the way forward. Okay. Thank you, Ivan, for answering these questions. Let's go to the next one, and that's for Slovenská sporiteľňa, for Pavel. What measures did the government introduce in the fight with the recession? I would guess to phrase it correctly, to fight the recession. I think it's very similar like everywhere. What we have in Slovakia is a program of subsidies to businesses which need to be closed because of the lockdown. There is a program for providing bridge loans or the loans to the corporates, which are granted by the government. Currently, there is under development this nationwide program which is connected to European Union funds. I don't think it makes much sense to go any deeper than this. I think it's perfectly fair enough, Pavel, because as you correctly said, it's similar measures across the countries, including Austria. No tremendously different things happening from country to country. Okay, thanks, Pavel. Let's move on to. I saw there was a question on Česká, it has been ruled out. Let's go to Hungary again. The question reads, any plans for the bank to also consider sustainable and green bond issuances? Once again, Ivan, also for you, the topic of ESG is being served up. Yeah. Thank you for that question. To be very honest with you, we had this consideration, but it hasn't materialized yet. Yeah, we have to be really firm and convinced about that we can really put the label of green on that issuance, and we are not there yet. Yeah, we are considering it, but it's not a firm plan yet. That's the answer. Okay. I think that's fair enough. Thanks, Ivan. I think the Czech question has re-emerged. No, we are back to Slovenská, actually. No, I think we had this question already, the fight against the recession. Let's move to the next one. It would be Česká spořitelna. I think, Wolfgang, finally, you are sort of asked to come forward again. What is your expectation on monetary policy key repo rate development? I think this is always a very hot topic in the Czech Republic, right? It's very publicly discussed, and the current majority is definitely an increase, at the end of this year, 25 basis points. These are the cautious, careful, conservative ones. Others are saying second half and maybe more than 25 basis points. The Czech government bonds, the new issuances are at 1.9%, which is quite attractive. I'm more the optimistic one. I hope it will come earlier than November, December, and maybe we see even two. I think we need to see what will happen further on with this health crisis and what does it do to the economy. Thank you, Wolfgang. Thank you. Perfectly sensible answer. One final one to go because we are entering the final minute here. That is, again, back to you in Budapest, Ivan. How did the pandemic affect the Hungarian economy, and what do you expect in the next period? Yeah, thank you for the question. I have to say that the pandemic effect is developing better than expected. The contraction of the GDP is lower than our expectations. Inflation oscillating around 300 basis points. It's as well better than we expected. Generally, our expectation, there will be V-shaped recovery for Hungarian economy. What I can tell you that we had a really very good start of the year. I have been working in Hungary for five years, and we have never had such a good start of the year in spite of the fact that we have a pandemic situation. Moving forward, we are quite optimistic for Hungarian market. Okay, I think on this positive statement, I would like to conclude today's event and also thank all of the panelists for participating, of course, Pavel Cetkovský, Krešimir Barić, Wolfgang Schopf, Elke Meier, and Ivan Vondra. I would also like to tell you, the audience, that the whole video and all the supporting materials, be it presentations, et cetera, will be available on the following website. That's www.erstonline.eu. On top of that, you can also find these materials on our investor relations website, on the erstegroup.com website. The respective local presentations will be obviously made available on the local country subsidiary websites as well. No excuses for not finding the info, guys. Please go ahead and check out the respective websites wherever you see fit. With this, since we are one minute overdue already, I would like to thank everybody once again, the panelists, the audience, and everybody who was supporting in making this happen. I wish you a very good day from Vienna and hope to see you soon. Bye-bye. Thank you. Bye-bye. Bye.