Good afternoon, ladies and gentlemen, welcome to the Q2 2023 results conference call of Raiffeisen Bank International. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Johann Strobl, Chief Executive Officer. Please go ahead, sir. Thank you very much. Ladies and gentlemen, welcome to our Q2 2023 update. Thank you for taking the time today. I'm pleased to report stable operating trends, stable deposit volumes, and stable capital ratios. Asset quality trends remain excellent. Hannes will talk about all the details in a few minutes. As expected, loan growth continues to be very subdued, while the high level of provisions in Poland are the unusual and disappointing development in the quarter. We will go through each of these points in the following slides. Let me first address a few of the other topics, which I'm sure you are interested in. Regarding our options in Russia, first of all, we continue to engage with the many regulatory authorities as we seek to either sell or spin off the Russian business, and we are as committed as ever before to reaching a solution. In our last call, we mentioned thirtieth September as the earliest possible date for the spin-off, and as of today, this appears unlikely. We will continue to work on this option, now aiming for the end of December as a spin-off date. The sales process is equally still on the table, of course, and there is little more I can add today. Remaining in Russia, but on an unrelated note, the intragroup subordinated instruments, which were issued by a Russian subsidiary and placed in Vienna, were repaid in full. The Central Bank of Russia approved the early call and repayment of these instruments based on the very high CET1 ratio of our subsidiary there. Regarding the OFAC request for information, I can confirm that we have produced all the information requested, and we have already started to answer some of the verification requests. Based on what we have submitted and, of course, on the many reviews of our compliance set up in recent years, I'm convinced that our systems are robust and we will fully satisfy the requests from OFAC. When looking at the results, including Russia and Belarus, we have earned EUR 1.2 billion in the first half of the year, with a very high headline contribution for these two countries. I believe it is worth taking a closer look, however. Due to the weakening of the ruble FX rate, Russia's total contribution to group equity is actually negative this year. The large negative FX move, which goes through OCI, more than offsets the headline profit reported in Russia. Excluding Russia and Belarus, we can report a consolidated profit of about EUR 500 million and a return on equity of 7.6%. This ROE below, is below our full year guidance of 10%, and it includes the bulk of the governmental measures and contributions, which are booked in Q1, as well as the much higher-than-expected provisions for litigations in Poland. The high provisions in Poland follow the negative European Court of Justice decision in June, which has led to a surge in new cases in our model, both observed and expected. The capital ratio for the group, excluding Russia, improves to 13.9%, which I will discuss in a few minutes. Moving to my next slide. Loans to customers are flat year to date, which will not come as a surprise, I guess. You recall that the loan growth in Q1 was largely driven by short-term business and repos, which was largely reversed in Q2. Core revenues, on the other hand, continue to be very resilient, and we have slightly increased our guidance for NII and fee income. OpEx are up in Q2, largely reflecting a combination of wage increases and vacation allowance bookings. Moving to slide 6 and taking a closer look at NII and fees. Excluding Russia and Belarus, NII improves 4% in the quarter, with increases in Group Capital Markets and in our key CEE and SEE markets. Generally, what I can say is that we're still seeing some benefits from higher euro rates, not least in the countries outside the Euro zone, where we have very stable deposits. In the C currencies, we do see some deposit pricing in Hungary and in Romania, and in Czechia, our net interest margin has stabilized. We can now guide for 2023 NII, excluding Russia and Belarus, of somewhere between EUR 3.8 billion and EUR 4 billion. Fees and commission income are down slightly in the quarter. Looking at the ex-Russia, Belarus view, this is largely driven by a drop in Group Corporates & Markets. Here we see a reduction in Russia-related business, such as payments, clearing, and effects. It's also having an impact on the head office. In extraordinary fee businesses that we earned in Russia over the past 5 quarters or so, was also somehow benefiting in, in Vienna here, and this is now reverting to the pre-war trend. While the business here in Vienna was down, we continued to see a decent NFCI growth in our key CEE and SCE markets. In Russia, we continue to see a drop in fee income, which is both a reflection of our efforts to reduce specific activities there and a sharply lower euro ruble rate. Full year guidance for NFCI, excluding Russia and Belarus, is slightly increased to EUR 1.8 billion. Moving to the next slide, the balance sheet developments are now on slide 7. We look at loans and deposits, and as I mentioned before, loan growth very muted again, very much as expected. You will recall that Q1 loan growth was largely driven by short-term and repo business in head office, this was reversed in Q2. Retail lending has slowed noticeably, in particular, mortgages, corporate volumes are pretty flat. On the deposit side, we've seen increase in CEE and SEE, whereas in head office, we saw further reductions in the very short term, price-sensitive deposits. These deposits have no value to us from a liquidity perspective, considering our very comfortable liquidity position, we prefer not to pay up for these. This brings me to my next slide, where we take a closer look at liquidity, which is slide 8. Here, I'm very happy to report that liquidity is very good. Our coverage ratio and the NSFR are excellent as always, each of our individual units are solid. Head office, as you know, is wholesale funded and does not accept retail deposits. The ratios here are equally strong, and as I mentioned to you last time, we run a very conservat- very conservation run-off scenario when we stress our liquidity. If you assume 100% outflow on all liabilities, including, of course, all deposits over the next 12 months, we will still be very liquid. Last quarter, we reported over EUR 1 billion of excess liquidity after 12 months. In this extreme simulation, and in this quarter, the result has increased to around EUR 2 billion. as I said last time, I don't think that you can have a more conservative approach to manage your liquidity position. Coming now to slide 9, what you see here is a stable CET1 ratio. We had a couple of, to some extent, effects-related, negative impacts, and these were compensated by the retained earnings of 58 basis points. To remind you, on the lower part of this slide, the earmarked, EUR 0.80 per share CET1, which are 27 basis points in CET1, are deducted, of course, from this regulatory capital. What I also have to mention is this is a transitional number. We benefit from the IFRS 9 by some basis points. Coming to the next slide, which is the outlook. Here we say on total group, we expect to be above 16%, and you see the drivers, which are retained earnings, which are on the negative side, some RWA increases. We expect a small loan growth, but also we expect higher market and operational risk-driven RWAs. We have a positive impact from the effects, which is based on our rate forecast, and then we have some inorganic effects which net should be positive. Since a while, we share a very harsh simulation, which is a price-to-book zero deconsolidation of our Russian entity, and we have set a target to be above 13.5, which actually is at the end of June, it would have been at 13.9. The basic assumptions are EUR 4 billion of IFRS equity and EUR 14.5 billion of RWAs, which are, for clarification, are not only the RWAs in Russia, but also on head office level. Some RWAs for the market risk for the structural position. What is not included in the 13.9 is a potential upside from the operational risk. Currently, we have a 40 basis points impact from the operational risk because of the good income situation in Russia, and here, it in case of the consolidation, it would be in the hand of the ECB if they would allow an immediate impact on that or the standard phased-out approach. I think the next slide, 12, is more for your documentation, as you're all aware of the various requirements, what we have, and the forecast of additional requirements until end of the years to be used by early next year. I would move to the next slide, 13, which is some information on the MREL requirements and the funding, funding plan. In RBI AG, we currently have a solid 14.6 MREL ratio, with all the details, what you see here. All I can say is that this, of course, is a result of the fundings, what we did earlier this year. We consider in the course of this year, senior non-preferred issuance, to maintain the loss-absorbing capacity and support credit ratings. When looking at other members of the group, what you see is that most of the countries, Czech, Slovakia, Hungary, and Croatia, are above the requirements for this year, and Romania still has a little while to go there. One update on Russia. Here I have to make you aware that, of course, as we throughout the report, are in euros, you see a further reduction in loans to customers, year to date. A large part of this -21% comes, of course, from the ruble devaluation against the euro. The net cross-border exposure was reduced further. You might remember we had, on first of March last year, EUR 600 million, we are now down to EUR 170 million. What I explained from the loans to customers, what you see here as well, when we discussed the RWA impact in Russia under IFRS, here you see a bigger part comes from the FX impact from the reduction. When looking at the bank in Russia, you see a very, a very strong bank with a CET1 ratio of 13% pro forma and a significant buffer, which in, in absolute terms, would be 3 billion above the minimum requirement. The liquidity ratio with an LCR close to 400% is very strong, which is not a surprise when you look at the loan deposit ratio, which is down to 42%. We have seen coming now to the outlook, we have seen a slowdown in Europe in the first half of the year, with Hungary and Czechia entering into a recession. Recovery will come in the second half of the year. We see mainly the manufacturing industries which suffer, especially those countries which have close relationships to their German partners. In the, in the southern part, where tourism is, is significantly more important, we see a relatively positive development. Inflation and high interest rates have an impact on household demand, so we see a slowdown. On the other hand, what we can also report, and which is a very good information, is that the unemployment numbers are still very low. This is, I think overall, very good for consumption, but also for our risk costs. In Russia, we see an L-shaped stagnation scenario with a rebound in 2023, driven by some fiscal measures. On 16, you see our inflation report on these countries and also what we expect in the key rate developments. It's easy to say that with the exception of Serbia, we expect that we have seen the peak already, and those country which started earlier or have higher, very high key rates, we expect already this year, a reduction, what you can see here. This brings me to slide 17, the guidance for this year. I have mentioned it in the introduction. Net Interest Income, somewhere between EUR 3.8 billion and EUR 4 billion. Fee and commission on EUR 1.8 billion. This is the group, excluding Russia and Belarus. On total group, this would be EUR 5.3-EUR 5.4, and Fee and commission income, EUR 3.2-EUR 3.4. Small loan growth in the non-Russian, Belarus area, OpEx around EUR 3.1 or EUR 4, respectively. Low risk costs, profitability at around 10%, on the... Let's call it the core group, and then the total group, rather 17%. CET1 ratio, I have mentioned already, above 13.5 and 16, respectively. With this, I hand over to Hannes. Johann, thank you. Good afternoon, ladies and gentlemen. Thank you for joining us today. Following this call, and maybe after a few other earnings calls, I hope you enjoy your summer holidays. I will be brief this afternoon with relatively straightforward developments in the second quarter. I'm sure you have seen it. Asset quality remains very good, and we are still not seeing any big cup in insolvencies and defaults. Accordingly, the risk costs in the quarter are very low. For the core of the group, 4 basis points or EUR 50 million, driven by small incremental overlay bookings, while for the group, including Russia and Belarus, we actually saw net releases. This is the result of overlays being released in Russia, in line with exposure reduction in the country. Regarding overlays, we now have a level of EUR 865 million. As mentioned, we released some in Russia and booked a small amount in the core of the group. You recall from our Q1 call, we conducted an internal stress test on our commercial real estate portfolio. This exercise confirmed that our provisions in Austria and Group Corporates & Markets are adequate, and we took a few extra provisions in Czech Republic and Hungary. Also, in the first half of the year, we participated in the EBA stress test, for which the results are announced on Friday. This process is always a very demanding one, and I'm very proud of the way my colleagues have delivered all the calculation and data on short notice. A big thank you to my colleagues who have executed on this EBA stress test. The outcome for RBI is very satisfactory. Our capital depletion in the adverse scenario is 316 basis points, below the average of the European banks, and more importantly, the outcome, if you exclude Russia, is broadly unchanged using similar assumptions. You also will have noticed that both Moody's and S&P affirmed our ratings this quarter. In fact, Moody's even upgraded the RBI group. Putting together the stress test and the rating information confirm that our business model and balance sheets are extremely strong. Finally, as just mentioned by Johann, we have updated parts of our guidance for 2023, and this includes some changes for the risk cost expectations. For the group, including Russia and Belarus, we can now guide for around 60 basis points, while for the core, excluding those two countries, we expect up to 45 basis points. Keep in mind that, of course, the core includes Ukraine. Focusing solely on Group Capital Markets, Central Europe and South Eastern Europe, we expect around 30 basis points of risk costs this year. As I promised to be brief, I have tried my best. Let's now run through the slides and more interestingly, move on to the Q&A. I would now move on to the page 20, where you can see the details of changes in the due course of IFRS 9 provisions in the second quarter. Stage one, stage two increase mainly comes from Ukraine and Czech Republic, a little bit also from Group Corporates & Markets. We have seen some small releases. You see in the section on overlays, as I have announced, that there was a strong reduction of EUR 45 million. Maybe as a background information, usually we try to deploy the concept of overlays in a manner that whenever we see exposure reduction, that we have to and that we can release on a pro rata basis, also the allocated provisions. Which leads then finally to a release of provisions of EUR 42 million in the second quarter. I'm on page 21, and if you look at the RWAs development, we have finished year-end, quarter-end, 31st of March, with EUR 98.6 billion, and the first half year, we have finished with EUR 99.2 billion. What are the biggest changes? The one is the inorganic effect. We have updated our rating models on the FI side, on specialized lending. At the same time, we also have seen a pronounced effects impact of EUR 1 billion, leading then finally to RWA of EUR 99.2 billion. I'm already on page 22, and I want to give you an update on the Poland Swiss franc situation. We have currently cumulated a stock of provisions when it comes to litigation provisions of almost EUR 1 billion. You can see that in the first half year, we have increased this provision level by another EUR 400 million. If you also consider what is our capital consumption from credit risk RWA and impairments, we would have a current CET-1 equivalent coverage of EUR 1 billion. This EUR 1 billion of level of litigation provisions is around about 63% of the outstanding cross-exposure. Well, page 23 would just highlight, the NP ratios per segment and with the respective coverage. As I said, I'm aiming for being very brief and being more curious about your questions. Ladies and gentlemen, we will now start the Q&A session. If you wish to ask a question today, you will need to press star one on your telephone keypad. Please ensure that your mute function on your telephone is turned off or we will not receive your signal. Once again, if you wish to ask a question, you will need to press star one. If for any reason you need to remove yourself from the queue, you can do so by pressing star two. We will pause for a moment in order to allow a queue to assemble. Our first question comes from Mehmet Sevim with JPMorgan. Your line is open. Please go ahead. Good afternoon. Thanks very much for the presentation. I'll have 3 questions, please. Hopefully, they should all be easy. First one on Polish CHF provisions. The coverage has reached a significant level now, as you also mentioned during the presentation. How would you see the provisions evolve from here over the coming quarters and years? Any color would be helpful. Secondly, just on your cost momentum, I'd like to, if possible, understand the quarterly moves better. What's driving the 10% growth quarter and quarter at the group level? If I look at the cost growth, excluding Russia and Belarus, it's 12.5%. I can't seem to reconcile it from the individual subsidiaries, so any color would be helpful, maybe also with regards to your upgraded, or higher cost guidance for the full year as well. Finally, just on the capital bridge, on page 10, where you show the target for the full year. Just for me to fully understand, the retained earnings impact of 110 basis points, this is for the second half of the year, or is this for the full year, as it says on the slide? Because obviously, the first half impact already. That would be helpful. Thank you very much. Mehmet, thanks for your questions. When, when it comes to the Swiss franc provisions, for, for a Polish branch, well, I think at this stage, we would not expect material further provisions in 2023 to be expected. We have currently coverage of 63%. Well, of course, depending on the inflow, we may see here and there, a slight higher provisions. This, I think this is what is really important to observe. If in Q3 we would see another pronounced inflow, of course we would adjust accordingly, but basically, we believe that we have a good coverage achieved up to now. As said, maybe a bit higher, still to be expected in Q3, Q4. Thank you, Hannes. I take the other two questions. I think what is most important, if you look at the comparison Q1 to Q2, what you have to be aware is that especially in, in, in head office, there came additional... The, the, the core wage increases, which came based on the inflation, what we had in the year before, came in in the, the beginning of the second quarter, which is impact there is a little bit above EUR 30 million. Then, then what we have in the other administrative expenses, of course, there, we also have seen partly some inflation adjustments on the services we, we buy. Then there are significant costs which are related on our activities around finding a solution for Russia. When we look at the coming quarters, as I said, in some countries, this, this, this lags of the inflation in 2022, of the 2022 inflation will now materialize. I do not exclude that here and there some more, and difficult to say, depending on the development of our Russian activities. So not the activities in Russia, but the finding a solution for the Russian entity might add additional costs where I cannot give, at this point in time, a guidance. For the year-end, as we said, on group level, we expect EUR 3.9 billion-EUR 4 billion of costs. When talking about the capital bridge, some additional informations. I think the one, the one part is relatively clear, which is we, we add the profit, what we have in the outlook. We have this payout ratio, which we use, as we have not set a specific dividend policy, which is around 17%, which of course is deducted already in half year and will be deducted also for the, the full year. And then we have, as I said, a small loan growth assumed, which is 2% or so, which translate then in, in a small amount of organic RWAs. What is more important is that some additional RWAs will come from the, the market and op risk RWAs, which might be around EUR 3 billion on group level, and without Russia, EUR 1 billion. Of course, the OCI impact from especially the ruble exposure, the effects development. Here we have a forecast that we assume and now an appreciation compared to the low levels, what we have, which should bring plus maybe EUR 300 million, something. There are some further, let's call it, opportunities in the inorganic RWA. The one is the famous Article 500, which is sovereign bonds in foreign currency, which had been during the pandemic, weighted with 0, then reversed, and I understand that there are now discussions to reverse the reverse. We're working since long for an increasing the scope for retail retail loans, especially here in Austria Building Society, which we hope will get the approval in the second half of the year, which will also be positive. These are the under the other reported inorganic elements. Thank you for your question. Very helpful. Thank you for the details. Our next question comes from Gabor Kemeny with Autonomous. Your line is open. Please go ahead. Hi. A few questions from me, please. Firstly, on Russia. I assume that pushing out the possible timing of the divestment is related to the issues, complexities, and the regulatory approvals. What is your level of confidence that you will be able to secure these regulatory approvals by the end of this year? To your mind, how do the sale and the spin-off compare from a perspective of operational complexity? That's the first issue. The second one would be if you could please remind us about your sensitivities to interest rate cuts in various markets. I will leave it there. Thank you. Very difficult question, and the phase where we are in is currently an informal exploration of a potential approval. Here I say we are more advanced in the sale than in the spin-off part. Also, when we now ask how confident I am, then I can say that this informal phase takes a little bit longer than I originally or at the beginning, I would have expected. Usually this, this simply for me, is I take this as an indication that it might be a little bit more difficult and complex than we would like to see. Without giving you or I cannot, cannot. It would be pure speculation why? It can also be that Russian authorities have so many other topics that it's still delayed, but of course, as the one who expects an information, I rather tend to that it's not a straightforward process anymore. I think, I think still we would get more information in the course of the next couple of weeks, at least this is what we expect. From that perspective, I would say at this point in time, it seems that the spin-off there are the one or the other additional question, which makes it even more complex than the direct sale. Coming to your second questions, which is the sensitivity of the NII to interest rate cuts. I think in Czechia, a very low double-digit impact, if you assume a 50 basis point, in Hungary, mid-single-digit, and in Romania, maybe also a higher single-digit impact, what we have, what we could expect from the 50 basis points sensitivity calculus. Thank you. Our next question comes from Benoit Petrarque with Kepler. Your line is open. Please go ahead. Yes, good afternoon. Thanks for the presentation. The first question is on the exit scenario. Do you think they see also a scenario where nothing will, will happen? Do you see any body language or tone of voice indicating that the Russian counterparts want to do nothing eventually? I also wanted to check if there's any read- across from the Carlsberg Danone nationalization case. I guess no, but just wanted to, to check with you. Second question is on the net interest income. I think for the rest of the year, you indicate a bit of a softer trend, but I was trying to also understand, kind of the trend for 2024. I guess, it's a bit more complex to estimate, but I just wanted to have your view on that, and also what you think about rate cut for 2024 on your forecast, how much impact that could have on net interest income. The third question is actually more on the dividend side. When do you expect the approval for the EUR 0.80? Then also, it seems that you accrued EUR 0.50, which could suggest that you will go for a EUR 1 per share dividend on full year 2023, which will imply, roughly speaking, 30% payout ratio. Is this kind of level a good level to think about the state of future payout ratio for the core business? Thank you. Thank you for your questions. I think I tried in my answer before, to outline that currently it's in the hands of the many authorities where we need an approval, and it's we're still in this informal phase, and it's difficult to add here. However, what we said is that and we mentioned that we are in a readjustment of the business in Russia. These adjustments are on the way, and you have seen it already in the numbers, and of course, this will continue for a while. I have to say on all the informations I have on the 2 cases, what you have mentioned is only what is available in public media. I don't have any additional insight, so it would be very much guessing, which would not add any, any contribution to, the current situation and to your knowledge. I think coming to your second questions, the guidance on the net interest income, I think it's from the numbers, from the range what we gave. I think it's in combination with the half year results, it's easy to see this, the softer trend, what we expect. As I maybe I should say it, of course, it comes from the loan low demand is that we cannot add something significantly to the loan book, which would support the NII. Second, what we see, and then, and the explanation simply is that in the current situation, we see a significantly reduced new business in, in corporates, mainly in the mid-long term investment loans and in the retail sector. For many reasons, high rates, uncertainty, many other topics why we see a significantly reduced demand in all the markets or in almost all the markets in the mortgage area. These are the main two reasons. On the liability side, it's the restructuring. We see more and more customers moving from moving money from their current account to higher rated, higher rates products like savings accounts and term deposits. This is an ongoing trend. I think it's too early to see when this trend stops and when, from the perspective of the customer, the balance is reached, on how they want to structure their own assets. Maybe, for 2024, it's a little bit too early to give further guidance. To your third question, indeed, your assumptions are correct, what we have so far. This is, as I said, the 2023 is not the dividend policy per se, but it's rather the methodology which we use, which is given by the European Central Bank. Here again, it, as you're aware, the current situation is for us, still, still, let's say, with a couple of uncertainties. technically, of course, we would need an extraordinary shareholder meeting for any dividend payment, and, and we would take more weeks to come to a final decision on that. Thank you. Our next question comes from Máté Nemes, with UBS. Your line is open. Please go ahead. Yes, good afternoon, thank you for the presentation. I had 2 questions, please. The first one is on risk, or risk relates to be specific. I was wondering if you could talk about your approach to these risk overlays, the usage of these, or reversal of them in the second half of the year and next year. I clearly noticed that ex Russia and Belarus, those overlays still went up in the second quarter, notwithstanding some of the releases in individual countries. I'm just wondering, in light of the 45 bits cost of risk guidance this year, how would you approach those overlays? The second question is just going back to a potential exit or deconsolidation in Russia. I was wondering if you could give us a sense of your talks with the ECB and regulator, whether such a process would have any issues with regards to the timing, i.e., the deconsolidation on the equity side and RWAs. Would this have to be wrapped up within the same quarter or fairly close to each other? Or, you sense that there could be some, let's say, leniency from the regulator's part? Thank you. Well, if I may start with the risk cost questions, Matthew, thanks for, for raising this question. When we talk about risk overlays compared to some competitors, we really talk about overlays. This is not macro, this is not anything else. This is really risk overlays. Just to remind ourselves, the total of 865 is, is decomposed of EUR 364 million allocated to the core of the group. We have another EUR 439 million when it comes to Russia and Belarus. As I said in my introduction, of course, Ukraine belongs to the core, but just because the amount is a little bit bigger, Ukraine is separately shown here with EUR 62 million. Well, when it comes to the usage, I think for Russia and Belarus, you know, we would make use of them when out of the geopolitical situation, there is the need that suddenly these loans would default. What was always important, that's the way on how we have utilized this approach on the post-model adjustment and the specific risk factors, is that whenever the exposure is being reduced, we would also automatically, on a pro rata basis, decrease the BMA. That's the, the, the first thing. On the, on the, on the, on the group, the EUR 364 million, they would mainly cover inflation, as also last time talked to, to you regarding interest rate-sensitive industries like commercial real estate. Whenever we would see that a loan is being repaid, we would reduce pro rata. On the other hand side, you know, if the loan is being moved into a stage three, we would of course, also make use of the stage, of this post-model adjustment and release accordingly. That's our way of thinking when it comes to the entire topic of BMAs. Thank you. To your second question, the regulatory approval process and the impact. we are, of course, very concerned. We discussed that any, any sale of the Russian entity at the given parameters would come with a significant loss and, and, and the deconsolidation of the RWAs only. The loss comes with the signing, the deconsolidation of the RWAs with the closing. We had a discussion with regulators, where they, they indicated, at least this is my reading, that it would be good if it would happen within the same quarter. That's, their thought behind. Of course, given the, the many signals what we hear, I would assume that European Regulators would, would try to be as fast, as, as quick as possible. Otherwise, it, we would be disappointed. Is it doable in, in one quarter? We hope so, with a good preparation before, but it's unclear. On the other hand, we now have a good capital situation also. I, I, I think what was worrisome last year is at least we built up some buffer for that situation as well. What you have seen in my part of the presentation. Thank you. We'll go next to Johannes Thormann with HSBC. Your line is open. Please go ahead. Good afternoon, everybody. Thormann. Two questions from my side. First of all, on the muted or difficult loan growth, can you quantify how much is really lack of demand and how much is self-inflicted pain, or however you ever want to call it, via the tightening of credit standards, where you refrain from giving certain loans, as you mentioned as well? Regarding your NPEs, the drop is to 1.5% is truly a strong achievement. What is a realistic level in your view of NPEs in the next years? I guess five years ago, nobody expected that RBI could come that low. What is a realistic level of through the cycle risk cost? Thank you. ... Well, if I may start with the, with the second question, where you have built a bridge to the NPE and that NPEs are very low. Thanks for recognizing, yes, this was a lot of work, and I think we have managed well, not immediately selling, as many have expected, but really also try to get a good recovery in the interest of our shareholders. Well, I would believe, looking at the, at the current forward-looking indicators, BMAs and so on, so forth, and the still higher cost, higher interest rate, that we could see interest rates, sorry, risk costs going up slightly. At the same time, we must not forget that we have seen the last two, three years very benign risk costs at all. For me, this would be too early to give you a detailed arrival on risk costs for the next year. As said, we have seen the last 2, 3 year, very, very, very low risk costs, and you have seen that we usually have also used the situation to build up some of this post-model adjustment to be well-prepared if the cycle is turning. NPE at 1.5 is maybe difficult to sustain over a very long period, but if it would now increase by some 50 basis points or 60 basis points, I would not mind either. I think this is what comes into my mind when considering regarding the NPE dynamic. As you rightfully said, of course, we would try to avoid, by all means, that we go back to the NPE level of 5%, because it comes quite with a big regulatory effort. Johann? Thank you. Talking about loan growth, I think, of course, it's a mixed situation. Let me start with the demand and for example, with mortgage business. Of course, what we see in addition to higher interest rates, what we see is that also the supply of new flats and whatever, has slowed down in a number of markets. This is also one element which is the reason why demand is low. Of course, you might say, if we compare the what we see today in new volumes, what we have seen before the pandemic or at least, eight quarters ago, then one have to say that in a couple of markets, you also have refinancing. Refinancing happens if rates are low, but refinancing does not happen in a, in a rising rate environment. It's for everyone, more, more prudent to stay. So difficult to answer. If you talk about self-restraint, then I would assume you would compare our productivity or our activities to the overall development in the market, and we exclude, of course, Eastern Europe in this way of thinking, then I would say at least maybe the numbers are not so good. I, I can't see many markets where we have lost market share. I, I think it's rather, rather what we see also from market participants. Of course, in an, in a rising rate environment, the asset margin on mortgages had been very, very small, very little. This adds, of course, to the self-restraint activity. If this improves because of adjustments, then maybe one might see more. Overall, this is the way I see the picture. We'll go next to Riccardo Rovere with Mediobanca. Your line is open. Please go ahead. Thanks. Thanks for taking my question. Two or three, if I may. First of all, I just want a clarification on the spin-off. Johann, did you say before that at the moment, the spin-off seems to be more complicated than a straight sale? I'm not sure I got it correctly. I just want to have a confirmation on this. The second question I have is, when I look at the slides where you show the Russian business at the back of your pack of slides, the loan book is almost as basically halved in a year, from EUR 13 billion to kind of EUR 7 billion. Certainly, there might eventually be some effects, effect too. Is this speed... can this speed continue? You have also reduced the book by roughly EUR 1 billion in quarter. Is this a speed that can be that can be kept, meaning maybe 1 year down the road, 1.5 years, 2 years down the road, if, if nothing happens on the spin-off, on the straight sale, you can just, you know, wind down the operations without doing anything on top of that as an extraordinary actions. The question is: How long will it take to basically bring everything to 0? Is what we have seen so far reliable as for the future? The other question I have is on the Czech tax, which I've seen you, you booked some EUR 16 million, just a curiosity here, and that's all you need to, to book for the year. Is this gonna stay for 2024, too, more or less of the, Sorry, maybe I should know the, the answer, but just, but I, I admit it, I lost a little bit of track on that. Thanks. To your first question, Ricardo. Sorry, if I was imprecise, What I wanted to express is that in this informal, informal, I can't say application, informal exchange of ideas with authorities, I wanted to say my perception is that, that, we are a little bit more advanced with the sale than with the spin-off. This, this is what, what I, I want to say, and does not necessarily mean that, that it's indeed more complex, but it's more advanced in the one than in the other. This is the to your first question. To the second, the loan book, I think what we have to be aware is that the reduction this year came from the ruble development. The, what we reported now is minus 20%. The biggest part came from the effects development as it was reported in Euro. Recently, the reduction was relatively small, I think the bigger part of the -- the short term, which, which simply run off, happened already last year. Of course, we will have further runoffs, and this will reduce the business. I think also the recently increased central bank rate will slow down a little bit the process, because refinancing at a higher rate is difficult, and I have no idea how much incentives this would need. I think your linearization or you, of course, you use more complex models than linear models, but I would not do, but we will work on and find out what, what more we can achieve, as this is the fallback version to... This is what I understand, what, what, what many, many other international banks are doing, not considering a sale or a spin-off, but rather reducing the business. This is also one, let's say, the third option, what we explore currently. Your third question was about the tax windfall tax in the Czech Republic. Indeed, There are a couple of developments which are, which we believe significantly reduces the tax base for this special tax, and we have booked already, I think, EUR 7 million. So probably in the second half of the year, there should not be a big impact. As there had been many developments, like also the significantly increased risk, sorry, interest expenses, which were had a negative impact on the development of the bank, but therefore also a positive impact on the again, negative impact, potential negative impact of the windfall tax. Thank you, Ricardo. Our next question comes from Christian Dubs with Barclays. Your line is open. Please go ahead. Hi. Thanks, thanks for taking my question. I have, I have three. The first one is on the fee. I look at slide number six, in which you clearly lay out the top three businesses for your fee. From that, I just wanted to understand, if I look at the three components that you have given on the slide, I see a considerable slowdown in the generate for the future, for the group X, the Russia-Belarus fee business. Could you help us understand the drivers for your guidance of EUR 1.8 billion? Second question is on the cost of risk. For the group X, Russia-Belarus, I see EUR 65 million of provision till now, and on the slide, Hannes has guided to EUR 420 million, up to EUR 420 million of risk guidance for the year, which is pretty similar to the last year. Are there any overlays, assumption built in for Ukraine, or is there something that I'm missing on? Lastly, a simple question on the dividend, I guess. You are expecting the spin-off process to be end by end of December. Should we expect the dividend that was that could have been supposed to be paid in this year, could, could be delayed? Thank you. Starting with your first question, at the beginning, the, I think the quality was not so good, but with the support of my colleagues, I assume now that your first question was about the slowdown in NFCI, and your question, what to expect in the second half of the year. the numbers, the numbers were stated EUR 1.8 billion for full year without Russia and Belarus. The reasons, and the slowdown, of course, on the total group level. One element you are aware that, if you look through the, through the various components of the NFCI, that lending always contributes, and with this assumption that we have, a significantly reduced loan growth, this, this is negative for the NFCI. Of course, I, I think I have mentioned that with the adjustment of the, the foreign currency payments, sorry, the, the, the foreign trade payments reduced, this has a significant element, we see coming with this also reduced FX business in Russia, and of course, also that the securities business is significantly lower. On the total group level, it's the reduced activities in Russia. I mean, on the other hand, one might expect that inflation supports, fee volumes. To some extent, this is the case. Probably not everywhere we can pass on this, and, and we should not forget that Croatia joined the euro, and of course, in this tourism season, significantly lower amounts simply come from that. Concerning your third question, which what I understood, you linked the question to, spin-off by the end of the year. Yes, technically, it's still possible. I think finance definitely would prefer for reducing complexity to have a spin-off rather at end of November. This, this means, if you look at the full process, we have another two months to clarify all the requirements, what we have before we officially start and bring it to an end. I think, not from our numbers, from the overall perception, our activities in Russia, are perceived as risky, and this is one, one element of the, of the limitations, what we have with dividend payouts. Of course, if there is anything positive when talking about the slightly delayed spin-off, then this would be a good opportunity. Here you are right to, to not only decide on a spin-off, but also on a dividend in the same extraordinary shareholder meeting. Thank you for your questions. Christian, if I may take the question on the risk cost guidance. Yes, indeed, you're right. We have EUR 65 million allocated to risk costs while giving a guidance of EUR 420 million, including, of course, Ukraine. Well, on Ukraine, our current reading of the situation would be that we would not plan additional overlays, but we might need here and there the one or other stage three bookings. That's the way when we share our thinking when it comes to the risk cost dynamics in Ukraine. That's the one. For the remaining means, Group Capital Markets, Southeastern Europe and Central Eastern Europe, we give a guidance, risk cost guidance of around about EUR 300 million. Here you could see, the one or other stage three bookings. As usually when I do the, the arrival of risk cost guidance, I always include one or two, surprise cases when, when thinking about, risk cost guidance, and, we still may need the one other basis points for additional, overlay bookings. Thank you for the questions. Well, next to Hugo Cruz with KBW. Your line is open. Please go ahead. Hi, thank you for the time. Just wanted to ask again about the solution for Russia. Do you have the sales solution? Do you have a potential buyer lined up, or you're still just talking about potential transaction scenarios with the authorities? When you're looking at the sale versus spin-off option, and you're looking what you want to do, do you want to have a solution that provides you with full deconsolidation and no future exposure to Russia? Or are you looking at a solution that keeps you with some exposure to potentially capture some future potential optionality from a potential end of the war? What would you like to do? Is it cut off all ties with Russia forever, or are you looking to keep some future optionality? Thank you. Indeed, it's not that we are. We're only working here. Indeed, there is interest out of Russia on acquiring the bank, this I can confirm. Second, deconsolidation is the main route, what we're going. This is why we look at sale and spin-off. Within that, and what I understood is you also ask, is there might there be something in between? At least this is the way I understood your question, where you say, could it be that you will not end up with a full sale, being, I don't know, let's say, forced to keep a minority share? This can also be the case. I don't know. We'll see. The point is, which I want to stress again, we are working with all our efforts, but the outcome is not in our hands because of the many approvals in this geopolitically difficult situation. This is. We cannot choose. Thank you for all your questions. Pardon me, sir. Just a reminder, thank you for all your questions. If you have any more, please remember to press star one on your telephone keypad to place your question. The mute function on your telephone needs to be turned off so we can get your signal. Maybe, operator, there, what I learned from my colleagues, there was a question in the chat, which was an update on the OFAC request for information. I can confirm that we have produced. So we had an agreement, which type of information are requested. We had an understanding, we have produced, we have submitted that. We are in a process of clarification of some of the information we provide, and we feel we are confident, what we always have said, that also after this, these questions, that our systems are robust and that I assume that OFAC will be satisfied with what we have delivered so far. I can't give you any timeline on I mean, it's an intensive process and quite a lot of questions, so I have no idea when this exercise might come to an end. Our next question comes from Juliane Gola with Goldman Sachs. Your line is open. Please go ahead. Good afternoon. Thank you for the presentation and for the opportunity. I have two questions, please. First, could I ask about the ruble hedge? Given the value of the hedge has reduced materially, you effectively now have the Russian equity unhedged, apart from the EUR 175 million of notional that's at the level of the subsidiary, if I'm not mistaken. Can I just ask, or could you please help us understand, what will the impact on the group equity be from the unhedged position in the Russian equity, assuming, delay in the deconsolidation of the subsidiary? My second question would be on the Swiss franc loans outstanding. What proportion of those are expected to be subject to litigation? Could you please talk a little bit about the developments that you have seen since the negative ECJ ruling in June? Thank you. Well, I would maybe start, Juliane, because, you know, your questions come in always indicated when talking about the Swiss franc loan. Many clients also being motivated and inspired by, by marketing campaigns, by local legal firms, that they would like to sue us. Currently, you know, we have, usually we have an inflow of round about 200, 250 new cases per month. In June, we have seen a more pronounced inflow of clients litigating us. This was round about 450. That was the reason why I said, well, there was a peak and there was a spike, but we would assume that in Q3, we would also have been a slowdown. The main impact of the European Court of Justice ruling was that we have seen a more pronounced inflow of new legal cases, and I also gave you the numbers when it comes to this one. At the same time, I believe this information is now being well digested and consumed in the market, and this is the basis for my assumption that we would now see a reduction of this, from this elevated level to a more through the cycling level. Johann? Thank you, Johannes. To the first question, ruble-euro hedge. I mean, the market is what it is, so it's impossible from the head office perspective to build up hedges. I can confirm the number, but this is within the Russian entity and not here. The second part of your question, the sensitivity of effects developments. I mean, I take a simple one, and I hope you, you accept if I say, a 5% devaluation, which is given what we have seen this year, a very modest one, but it's a sensitivity, of course, would have a CET1 impact by 12 basis points. So we lose, of course, easy, if we have EUR 4 billion of IFRS equity, we lose EUR 200 million. On the other hand, the RWA reduction would be some EUR 500 million, so this is these 12 basis points. That the hedge is so small that it would take off just 1 basis point. Net, then you would have 11. Thank you for your question. As there are no further questions at this time, we will now conclude today's conference call. Thank you for your participation.