Thank you for standing by, and welcome to the Australian Finance Group Limited investor briefing for AFG 2021 full year results announcement. All participants are in a listen-only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key, followed by number one on your telephone keypad. I would now like to hand the conference over to Mr. David Bailey, CEO. Please go ahead. Thanks very much. Good morning, everyone. I'm pleased that you could join us today and talk through our FY 2021 results, which represent a record result for AFG. If you go to page two, I'll just walk through the presentation. I won't touch on every line item in this, so we can move into questions. The reported NPAT is up 35% to AUD 51.3 million, which drives a final dividend of being up of 57% to AUD 0.074 per share. The underlying NPAT is up 37% as well to 49.6%. This result is really a reflection of a really strong residential settlements, which were up by 28% to AUD 43.6 billion. AFG Home Loans is a subset of that, also experienced a 10% increase in settlements to arrive at AUD 3.45 billion. The trail book now is AUD 11.2 billion within that part of the business. AFG Securities, we talked at the half year about AFG, post the pandemic starting to build flow. It's very, very pleasing that the H2 lodgments and settlements are up 80% and 35% respectively on the second half of FY 2020. The closing book is up 17% to AUD 3.39 billion as at 30 June 2021. Operating cash flow is up 45%, which is a testament to the cash flow generation capabilities of the business model, and our broker numbers are over 3,050 as at 30 June 2021. A little bit of a closer look at the full year results. Residential settlements were up 28% to AUD 43.6 billion. This growth was obviously supported by government stimulus, low interest rates, improved economic outlook. The first home buyers and upgraders were the main drivers of that sector, there was an observed increase of flow through the third party or broker channel. The AFG Securities book, we said that we'd be building within that business post the pandemic, and to have an AUD 3.39 billion loan book, which is up 17% after the slow start for the H1 was very pleasing. The strong H2 of the financial year really reflects increased activity across the market. We've talked about AFG Securities settlements. The lodgments are up 80% on the H2, which will drive a strong settlement pipeline into FY 2022. Similarly, commercial settlements the H1 were soft due to the obvious reasons of the pandemic. In the H2, they are 23% higher than the H2 of FY 2020. Revenue, as a consequence of all that, is up 11% in FY20 21 on the back of settlements and loan growth across the business. Net interest is 35% higher in FY 2021, being driven by the 17% growth in AFG Securities loan book. Operating cash flow, Ben will talk to shortly, is up 45% to AUD 58.6 million. The total dividends being maintained at 80% of underlying profit. The underlying profit excludes the share of profit and associates, and I'll talk about the increased contribution from our investment in Thinkt ank very, very shortly. That overall represents an increase of 32% on FY 2020. We think we're well positioned to continue to grow our earnings diversification strategy. Cash and other financial assets of AUD 282 million provide core balance sheet strength. The net securitization interest plus net cash flow from aggregation and white label trail books is up 20% and sits at just under AUD 83 million. Strong cash flow generation is supported by the established trail books, which provide the annuity style cash flows. The strategic and market outlook. The market outlook. The market continues to grow at record levels. We've talked about our settlement volumes, and whilst there's been an initial increase in first home buyer volumes, this is being replaced by investors we're seeing coming back into the market and supported by ongoing refinance and upgrader activities. The volumes remain elevated. The RMBS market remains buoyant, and the cost of funds allows a competitive environment for our AFG Securities business. Opportunities for nimble and fast-moving non-bank lenders continue to be present in this marketplace, and the commercial finance market has recovered in the H2. The strategic outlook really hinges on brokers remaining important to the sector. The market share of brokers has increased during the period. The overriding thematic is ongoing restrictions and lockdowns together with varying lender turnaround times increases the value of brokers to borrowers. Competition among aggregators remains high, however, and lenders, including neo and digital banks, continue to look to brokers to distribute their products and grow volumes. Our NIM has benefited from a lower cost of funds, and we would expect this to continue in the short term. We think we're well positioned to continue to deliver growth. We're continuing to diversify through investment into growth opportunities, including higher margin AFG Securities products. Strong cash flow generation from annuity style and trial and loan books, together with a debt-free balance sheet, will allow AFG to move quickly and take advantage of organic and inorganic opportunities. Our investment in strategic alliance with Volt Bank will begin to reap benefits in FY 2022. We'll introduce a white label product in the H2 of this half, together with integration, we commence integration of key parts of their technology into our AFG Securities program. If I move over to AFG Home Loans, these settlements increased by 10%, and there's a chart there that shows the mix of those settlements. The loan book grew 7% to AUD 11.2 billion. As highlighted at the end of December half year, with the stabilization of the funding market, we made the decision to begin to grow AFG Securities, and those volumes have returned. The investment, again, and the strategic alliance with Volt, will introduce a new white label mortgage to the AFG Home Loan stable of products in the H2 of this half. The AFG Securities business achieved settlements of AUD 1.35 billion, and those volumes are up 35% on the H2 of FY 2020. The loan book, AUD 3.39 billion. Higher margin near-prime product refreshed. We refreshed the higher margin near-prime products in this half and are launching an SMSF product in the H1, very shortly, to broaden the product range even further. I think the important part is AFG Securities provides a valuable lending proposition to brokers and customers. We are consistently in the top five lenders in terms of turnaround times, but whilst we're also growing our book. I think that is one of the key attributes of our AFG Securities business, is its decision time and consistency of credit decisions, which lend credibility and confidence to brokers recommending a product which is well priced and competitive in the marketplace. The increase in loan book as well as higher NIM delivers a significant contribution to AFG's record financial performance. The net interest margin includes the impact, obviously the impact of the inverted BBSW, which drives an improved cost of funds. We expect our current cost of funds outlook to be expected to be continued for at least the next six months. Warehouse capacity, as well as ongoing demand for our future and further RMBS transactions remain strong. If you go to page 11 of the book, you can see we've been able to continue to grow our AFG Securities business without having to sacrifice credit quality. The average loan size still sits at around about AUD 450,000-AUD 500,000. The LVR band still remain very conservative, and the geographic distribution is broader, basically where a majority of the population sits in the country. The AFG Securities book performance remains excellent. You can see there, we've got 27 loans out of 11,237, which are in greater than 30 days. It demonstrates a strong quality book and strong underlying credit proposition. No loss has been incurred on non-LMI insured loans. We mentioned there, due to the lockdowns in Sydney and Melbourne in particular, the hardships have moved to, at 10 August, to 0.93% of the book, which is about 61 loans. The more recent update on that is that number, as of yesterday, was 72 loans, of which 50% of them were actually still having interest-only payments on those. A very strong position in terms of outlook around hardships. Our white label, I think our investment in Thinkt ank has been one of our other success stories. As highlighted, commercial activity in the H1 was probably a little bit softer due to the overriding impact of the pandemic. That is really also a tale of two halves. There has been strong demand and improving volumes in the H2 of FY 2021. Importantly, our equity investment of 33% into Thinkt ank has driven an AUD 5.3 million contribution to earnings, and we are obviously very delighted in the progress Thinkt ank have made over the last two years in particular. Moving on, one of the things we are doing is continuing to invest in technology, and our CRM platform is a key pillar of that widening investment in technology. We are starting to look at migration of each broker into that platform, and we manage very carefully, recognizing that some of our brokers have been with us for a long time, and there's a large amount of data, so we will do it safely and slowly to ensure that the transition drives an excellent outcome for our brokers and ultimately their customers. We're continuing to invest in our analytics platform to drive insights for our brokers and also our own lending decisions. Brokers will obviously benefit from our investment in AFG Securities via our new loan processing platform to enable an even quicker time to yes. Obviously, the investment with Volt will also drive a stronger digital proposition for our brokers, but also as a white label alternative across our AFG Home Loans stable. AFG Business platform, that's probably been the softer one for the period. Obviously, on the back of the slowdown in commercial and asset finance areas in that H1, the result is down 42%. The other point to remember is that we created AFG Business as a tool for residential brokers to transition into becoming a commercial broker as well. Importantly, at a time when brokers have never been busier in terms of volume and customer demand, their ability to branch out or their desire to branch out has been impacted because they're catering with the demands that they've got already with their existing residential customers. As the market continues to evolve, we'll look to step that part of the business out again. In the short term, we would expect our results in that to be relatively flat moving forward. I might just hand over across to Ben, who can talk some of the financial information. Thank you, Dave, and good morning, everyone. Before I get into the summary cash flow on page 16, I'd just like to point something out in the P&L this year that we've reclassified. The commission expense relating to AFG Securities loans has been reclassified from commission expense to interest income, and we've reclassified the comparative figures as well. This is disclosed on page 59 of the annual report, and the movement in the current year was AUD 9.9 million, and the comparable figure was AUD 7.2 million. Moving into the summary cash flow, it has been a strong year for the cash flow generation of the business, which has been driven higher by higher activity in the business and the positive working capital movements in the year compared to last year. That's across the residential business that's had strong volume growth and also the AFG Securities business, with the book up 36%, driven by book growth and lower cost of funds in the market. The AFG Home Loans trail book has also increased over the period, which has contributed. FY 2021 cash flows also included the funding of our investment in technology, Mortgage Advice Bureau, and Volt Bank out of existing cash and cash reserves. The investment in intangibles is primarily our CRM technology project that David touched on. Moving on to slide 17 and the summary balance sheet. Our balance sheet remains simple and strong with the key elements, the AFG Residential, Commercial, and Home Loans trail books, which are now AUD 98 million on a net basis, the AFG Securities loan book, and unrestricted cash of just under AUD 107 million. Our balance sheet leaves us well placed to fund future growth, be it organic or inorganic. On slide 18, we touch on the trail book accounting, which has driven underlying profit up 37%. As you would expect in this environment, with significantly higher refinance activity, the loan life of loans within our trail book has reduced slightly. You can see on the slide there, down from 5.1 years to five, and 3.2 to 3.1 at the bottom end of that range. On slide 19, we touch on other income, which remains a continuing positive story with service fees, in particular, 13% higher in FY 2021. This is a result of good growth in broker numbers as well as the take-up of additional services. Service fees in this regard cover compliance, PI, marketing, and technology services. On slide 20, we touch on our July 2021 trading update. There's strong growth across the majority of the country, the AFG Home Loans business and the AFG Securities business. Settlements as well in July were a record for the business as the strong lodgement pipeline for the half has continued to feed through. The one call-out there, it looks a little bit different to the rest is the growth in lodgements in WA, up 1% year-on-year. That's really a function of the fact that WA, this time last year, was already out of lockdowns and benefiting from the stimulus activity and was up 49% on July 2019 in 2020. This leaves us in a strong position to continue the volume into the start of FY 2022, and we're encouraged by this. I'll hand back over to Dave now to conclude. Thanks, Ben. In conclusion, this has been a record financial performance for AFG, representing a 35% growth in NPAT and 45% growth in operating cash flow. The success of AFG's ongoing earnings diversity strategy, which we set upon basically at and around just after listing, and cash flow generation ability of the business is pretty clear. The residential market has continued to grow. Early signs is that this will continue in FY 2022, despite some of the lockdowns across the country. Brokers are growing their share of the mortgage industry, and we expect brokers to continue to gain share. As a participant in that, we expect to be successful in also growing our own share of broker. AFG is rolling out the new technology to efficiently service the customer's needs. We remain committed to further technology investment to support brokers and customers. AFG Securities is continuing its loan book growth. They've got a significant current pipeline of business, and there's been improvements in higher margin products, also providing an effective entry into the marketplace. The funding markets importantly remain conducive to growth. We are positive about the outlook of the mortgage market. We are well capitalized. We have a strong balance sheet and continue to be a capital light business model. As you can see through the result, there's been a continuation of the strong cash flow generation capability of the business. I'd like to thank you for your time, and we would open to questions now. Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you are on a speaker phone, please take up your hand first to ask your question. Your first question comes from Tim Wilson from Macquarie. Please go ahead. Hi, David and Ben. Thanks for taking my question. Just around the comment you make on sort of margins, can you just unpack that a little bit, what you're seeing on pricing competition and the sort of timing of when you next expect to read back in the market, from warehouse to RMBS? Sure. The RMBS market, as of today, remains very conducive to issuers in the marketplace. We're probably continuing to be at strong low levels for the triple A piece. In terms of what we're seeing in the marketplace, the fixed rate product seems to have stepped out a little bit in terms of pricing. The new battleground is really, in some ways, around the variable piece. Yeah, that drives competition. At the same time, based on our growth of the business, we would be expecting, we always said we'd be back to the market in September, October, November, and that period, with a term transaction, and we're still on target for that. Okay. Thank you. Thank you. Your next question comes from Brendan Sproules from Citi. Please go ahead. Good morning, gents. I just have a couple of questions. Firstly, on the commission pay away, it looks like it's increased around 100 basis points over the year. Obviously, you've had the accounting change there. That's probably not as steep as we saw in the H1. Could you maybe talk about the drivers of that looking forward? I have a question on interest margins. I think I made the comment around half year as well, the difficulty in looking at just the pure commission expense line over the commission income into the mix between residential and AFG Home Loans with a different pay away. That can impact it. I think the thing I would point to is the slide 18, where we talk to the impact of trail book accounting. The percentage paid away to residential brokers on average is around 94.3%, which is disclosed on that page there, which is up slightly on last year. We typically see that grow somewhere between 15 and 30 basis points on an annual basis. With the competition in the market, we'd expect that to continue for a little while at least. Okay. Just a question on the net interest margins in your securities book, just sort of the outlook going forward, given that the funding costs, particularly as you mentioned, the securitization market looked quite favorable at the moment. It's a big benefit, lower funding costs in this year. How do we think about this next year, in terms of the benefit of securitization funding and then what you'll pass on, ultimately in your pricing? My second part of the question is the sort of big shift towards self-managed super, and also, the near-prime. Should that expand the NIM over time? Yeah, look, it's a good question. I think the cost of funds in the warehouse and RMBS markets at the moment remains quite conducive, as I said earlier in the presentation. As long as BBSW remains inverted where it is, that'll continue to provide some benefit. The counter to that is there's a higher level of competition, particularly in the prime low LVR segment of the market, which is an important segment for RMBS transactions. I guess what we're benefiting from on the cost of funds side, we're probably losing a little bit on the needed rate to customer to continue to grow the book, and that's where the SMSF and other high-margin products becomes important to increase the mix of those into the book to continue to maintain the NIM at around its current levels. There's certainly some pressure on it from a new rate customer perspective and competition in the market, as there always is in the industry. I think we expect those to probably largely counterbalance each other over the next 3- 6 months. I think, Brendan, the important call out there is there's been a considered step out into some of the near-prime piece. We've always had a link product, we haven't really concentrated on it as much, we certainly recognize the higher level of competition in the marketplace for pure prime. The step out into some of the near-prime and the launch of the self-managed super fund has been designed to control any NIM contraction, therefore basically offset any impact that we may have in terms of competition for the prime piece. Oh, that's great. Thank you. Thank you. Once again, if you wish to ask a question, please press star one on your telephone and wait for your name to be announced. Your next question comes from Richard Wiles from Morgan Stanley. Please go ahead. Good morning, David. Good morning, Ben. I have a couple of questions. Firstly, your positive commentary on the outlook for the mortgage market, does that make any assumption as to whether APRA and the RBA would introduce some macroprudential measures? If they do, can you make any comment on the potential impact on volumes and any comment on what types of measures might have the most detrimental effect on your outlook for settlements? Secondly, David, you mentioned in the presentation, I think it's in the slide as well, that AFG Securities sits in the top five lenders on turnaround. What is the turnaround time? How are you defining it? Why do you think you're so good, and why do you think some of the larger organizations haven't improved their performance, given how important this issue is and how it's been an issue for a couple of years now? Two questions, macroprudential measures and turnaround times. Sure. Our view around macroprudential still remains that whilst there's uncertainty in the marketplace in terms of lockdown, that that's probably been pushed down the road a little bit. If there was macroprudential likely to impact the majors and APRA regulated organizations, it's probably a debt-to-income ratio. That seems to be the simple one. That would probably slow down certain areas and certain lending in places. The impact that that would have on us, I made the comment in the pack that non-bank financial institutions are probably a lot more nimble than others. In terms of a trickle-down effect, non-banks can generally move credit decisions and action into the marketplace into new areas faster than other organizations. Particularly AFG, in terms of excuse me, in terms of the data we have around our brokers and our activity and the types of loans being written, we've always felt that we are more nimble than even the non-bank financial institutions. I think it's debt-to-income, if it comes. Obviously, they've introduced those things to slow down, so it would slow down. I'm not convinced at this point in time that that slowdown would slow down AFG Securities significantly in the marketplace. However, we are a microcosm of the broader mortgage market, but I still think there's opportunities for us to grow, if that was to wash through. What we're seeing at the moment is we're starting to see first home buyers come out of the market. I think the latest data was they're sitting around the mid-teens. We're seeing investors come back. Those numbers, investors, over the last couple of weeks are probably around 27% of our flow. If the regulator wanted to make some changes, they might look at investor again. That might slow things down. The other part of the question? Turnaround time. Oh, turnaround time. Yeah. Our turnaround time is measured by, we say top five, that's six days. That's lodged to unconditional. Obviously, lodged to unconditional means that the customer can go permanent on their finance offer, or sorry, on their point of sale offer, or actually move, excuse me, move straight into an auction and have confidence in being able to place a bid. I think why has it been such a long-term problem? I think there's a couple of factors. I think, first of all is a resourcing within financial institutions around credit departments and where the credit people are in terms of the business flow. There's probably been some, and it's been well documented, some preferential treatment of in-house originated loans versus third-party channel. We're seeing that change over the last six months in particular. We are at six days, and we're starting to see some of the lenders come in towards that number. It's not just around turnaround times, it's consistency of credit decision. Brokers work on making sure that they don't look stupid in front of a client because they've recommended someone into a client and they can't get a credit decision. If you build confidence with a broker around the customer proposition, you'll get return business on the provider that's in the best interest of the client. In this market, particularly right now, the client wants to know whether they've got finance more than ever. Is there a magic answer as to why? I think different lenders have different turnaround times for different reasons. Constant changing of credit policies, resourcing, moving resourcing offshore to onshore. There's been a multitude of factors, and some are getting it right. You'll see that in the mortgage index, organizations which are starting to get it right because they're getting more flow. David, if I could just follow up on that last piece. One of the large banks has just announced that they're bringing their mortgage processing centers back onshore, adding jobs in Australia. Do you think that will make a difference in the current environment? I think it will, but there'll be a transition, right? I think it's a positive step, not only for the economy, but more so for ensuring consistency of treatment and consistency of oversight. I think that will take, without a doubt, it's a massive project, but I think it's a positive. Great. Thanks, David. Thank you. Your next question comes from Azib Khan from Morgans Financial. Please go ahead. Thank you very much. Morning, David and Ben. A few questions from me. To keep it easy, I might just ask them one by one. Firstly, can you explain the reasoning for excluding share of profit of associates in setting your dividend payout ratio? I am particularly intrigued by that given your very strong unrestricted cash position, so would just like to understand the rationale there. Yeah. It's simply linked to the fact that there's no dividend cash flow coming out of those associates at this point in time. It's a position that we'll continue to assess and reassess that. When will you receive that cash? As paid in a dividend from the underlying businesses. Right. Why isn't it coming through already, Ben? Why isn't that coming through in the form of cash already? They're continuing to invest within their own businesses at this point in time. They've got strong growth. You can see in the Thinkt ank numbers in particular, the level of growth that's been within that business and as a securitization business, there's capital requirements within it. As you see from our own business, you hit a point in time where the cash flow that comes from those loan books is quite strong. That will come. If I take a look at Thinkt ank, obviously their commercial settlements looks like they've been going backwards, obviously, given the conditions. You've talked about improving commercial lending market in the H2. Where would Thinkt ank be reinvesting their profits? What areas are they reinvesting in? Are they looking to broaden their product suite? I do know that they've been growing their home loan product pretty fast as well. Are they looking to diversify their business? What are the areas where they're looking to reinvest their profit? The settlements you're looking at that we disclose in our investor presentation is just the settlements that come through our network. That's not the overall settlements for the Thinkt ank business. They're seeing strong growth over the last period in the residential product they sell, and SMSF and those types of products. It's a combination of their existing commercial business, which is continuing to grow, and the other products that as any securitization business has, there's capital requirements at the bottom of warehouse and securitization structures. They're also investing in technology across the business to lift the standard there. It's a combination of those two things. Okay, thank you. Coming back to your own cash position, you've obviously talked about having an unrestricted cash position now of about AUD 107 mil. If I try to exclude working capital requirements from that, I would estimate that you've still got surplus cash excluding working capital of above AUD 60 mil. Now that Connective isn't going ahead, what do you plan on doing with this surplus cash? Will you look at other opportunities to acquire distribution? I think that's a fair assessment, Aziz. Just because Connective isn't on the table at the moment, it doesn't necessarily mean that we've stopped considering other opportunities. Other growth opportunities, you've just summed it up there. Other opportunities looking for distribution. Probably the other thing worth calling out, Aziz, for that portion of that, we do keep in reserve the AFG Securities business, and the potential need to invest more capital in that business at a point in the cycle. Sure. In terms of your partnership with Volt, is it fair to say that the Volt white label economics come with a better commission arrangement than your existing white label suite? No, I couldn't comment on something which is commercial in confidence. Not asking for numbers, but as an indication, when we're modeling Volt, should we be using the average extra upfront intro that you get on white label products? Or will it be a little bit better than that? You should just use what we're using, what you're currently using, Aziz. Okay, it's no better than the existing. You should use what you're currently using, Aziz. Sure. Okay. Just coming back to the commercial lending market. You're saying you're seeing a bit of a recovery in the commercial lending market in the H2. Is that recovery being hampered at all by the lockdowns on the East Coast, or is that looking like a smoother recovery? We're seeing really good, strong lodgment pipelines, Aziz. It's almost like people are looking outside and beyond the lockdown and saying, "Well, when we open up, we want to be ready." The lodgment pipeline, particularly in the commercial mortgage, is strong. We've had some good periods with asset finance, some of which was obviously fueled by government incentives before 30 June, but the levels of activity are still pretty strong. Yeah. Okay. Next question is probably specifically for Ben. Ben, you've talked about the commission expense reclassification associated with the AFG Securities product. But the reported NIM hasn't yet been adjusted for that, has it, Ben? No, we report our NIM on a pure cost of funds basis like we always have. That excludes the commission expense that's paid to brokers writing our AFG Securities business. I think it's important we keep that consistent with the way we've reported it historically. Okay. You'll continue to report it this way going forward as well? That's right, yeah. Obviously we've seen the uptrend continue in broker payout ratios. As you'd mentioned earlier, you alluded to the figure of 94.3%. Can we expect that uptrend to continue in the near term? Yeah, I would expect so. There remains to be a high level of competition in the market. There's going to be continuing pressure on that number. Okay. Thank you. In terms of your cost of funding, at the moment it looks like marginal RMBS pricing is sitting notably below warehouse facility pricing. Is there potential for the cost of your warehouse funding to reduce further? Look, yeah, we are in 12-month rolling and sort of the review date then I think for the next one is November. Yeah, December. December. The other piece there, so yeah, certainly at the time of review date, we'd be looking to mark to market for want of a better term. The other piece is that we do have, in the next six months, one existing RMBS transaction, which will get to end of life. As those RMBS transactions work, the longer-dated pieces of those are higher priced. At the end of that four-year term of those RMBS, that will roll back into the warehouse. There'll be some pricing benefit for us there as well. Okay. Final question from me. Ben, a few months ago you were talking to a NIM headwind in terms of front to back book headwind for the AFG Securities business of about 1 basis point per month. Is it fair to say that that headwind has now strengthened to more like 1.5 basis points per month? Yeah, I think that's fair. I think the points we made earlier about competition in the market, there's quite a bit of activity for your prime variable rate now, not just a fixed rate product. I think that's a fair comment, and in some months it might be slightly more. Thank you very much. Thank you. Your next question comes from Oliver Stevens, Private Investor. Please go ahead. Hi, guys. How are you going? Hey, Ollie. Hey. I've just noticed your staff numbers have been pretty flat since you listed, and they've jumped pretty materially this year. Just wondering what's behind that and are you expecting further growth? Yeah, look, I think we flagged this at the half year really. The business has been very busy and, I think it's 15 months ago when the pandemic first was rolling through with lockdowns, we held on a number of recruitment roles that were open and made a couple of changes within the business. Those have come back on and around credit staff, sales staff, they're all very busy. We've seen them flow through to your settlements teams, and operational teams as well. On top of that, obviously with a recently significant IT build occurring, there's an increase in IT staff as well. I think that number is probably reflective of the activity within the business. Yeah. Not too much more growth there? I'd say probably a little bit. We're probably at a reasonable level now. There might be some temporary and contract type work that happens, but on a permanent ongoing basis, a small amount more. I think the other thing, Ollie, just in terms of, you've seen a step up in security, which therefore means credit assessors, but it's also people to process settlements of those loans, right? Make sure the paperwork washes through and handle those. Therefore, there's also the book grows, which means you need to add people in terms of your customer service as well. Yeah, cool. You touched on it fair bit, but your IT program seems to be a bit delayed. Is there potential for sort of cost blow-outs or things just not going anywhere near to plan, or is it more just a bit of a delay to make sure you get things right? Look, I think there's been a couple of things there. First of all, we're a national business operating in Perth, and COVID and travel restrictions has impacted the ability for getting in touch with brokers and making sure that it's to the requirements. We've also changed some of the scoping and expanded the scope as well during the period. Is there a requirement for additional expenditure? Yes, there will be. Is it going to blow us out of the park? At this stage, I don't think so. Yep. Last one. I'm a bit worried about bringing it up, still a bit traumatized still from the Hayne Royal Commission. The coalition committed to maintaining the upfront trails with a review in three years. Lo and behold, that's only sort of 6-9 months away. You got any early thoughts or indication about how the review may or may not take shape? The coalition or the government have pushed that past the election. We're talking maybe this time next year or a bit later. We're operating in an environment where there's been an increase in demand for broker services. The complaints around broker continue to be low. Guess what? The market share's grown and we've got Best Interest Duty over the top of it. To me, that tells me that every indicator says there's nothing that's fundamentally wrong with the program and with the remuneration system. If anything, customers are even better off and better protected because all our brokers are operating under Best Interest Duty, which is a requirement by law, and no other channel for mortgages has that requirement, which a lot of our brokers see as a positive. You go in a branch, you don't get Best Interest. Yeah. You haven't heard anything sort of from the opposition where they still got an issue with the trails? No. Look, we'll obviously engage with the opposition over time. I think those statistics that I've just pointed out too indicate that there's not a problem here, right? It's something we've been saying and the industry has been saying for a long period of time. Access to finance and ability to find the right home loan is still extremely important. Remuneration model underpins a broker's ability to continue to service those clients. What the opposition, I think, I'm not going to put words in the opposition's mouth because, I suspect, because there's not a lot of noise, they've probably haven't landed on a policy yet. I can't say what the opposition are thinking about the subject, but I wouldn't have thought it's a number one or number two or number three or even a number 10 on their list of policies to be developed and communicated. Yeah. It was probably a number two last time. Anyway, guys, thanks very much for that, chief. No problem. Thank you. Your next question comes from Richard Wiles from Morgan Stanley. Please go ahead. Thank you. Just one more question from me. The hardship or deferral levels are extraordinarily low across the industry and in your business. Dave, can you add any sort of insight as to why they're so good, and can you give any particular feedback from your customers around which types of customers _are seeking those deferrals? Is it any particular sort of cohort of loans? Yeah. I think this probably has been spoken to other CEOs around this, I think everyone's drawing comparison to the first incidence of hardships hitting down, and at that time, there was a significant amount of misinformation in the marketplace that moving into hardship meant you get effectively the bank or the financial institution would waive the monthly repayment on those home loans, and they would never need to repay that money. Almost like a free prepayment for a period. Our experience when we're speaking to customers as we move them through that hardship is that there was all of a sudden a realization that the debt just consolidates, and it either extends the loan term or increases the repayments when they're back on foot. I think that, together with a significantly lower interest rate environment, has meant customers are saying, "Oh, look, it's not free money. We'll do what we can and continue to pay it," whether it be interest only. As I said, about 50% of our hardships are interest only. The other 50% are what I would call full deferrals. The common theme of those people who are either self-employed, in sectors which have been impacted by lockdown, or people where the family income has been compromised because part-time work is no longer available or hours have been reduced because of the lockdown. David, that mix, 50% interest only and 50% full deferral, do you mean they're people who are already on interest only who are now choosing to defer those payments, or do you mean they're people who are on P&I but have chosen to switch perhaps temporarily to interest only? The second one. Yeah. They've effectively said, "Look." The conversations we're having with clients, and I'm sure it's the same with conversations across most financial institutions, are, can you afford to pay anything? It's important you don't let that interest capitalize and that the loan balance grow. Customers realize that. When you convert it into monthly repayments at an interest rate of 2.5% on average. Not a lot. Generally, it's not a lot, and people, they're not going out and they're not spending money unless it's on Uber Eats and home shopping. It's probably easier to control your expenditure when you're in lockdown. I know I did. Thank you. Thank you. There are no further questions at this time. I'll now hand back to Mr. Bailey for closing remarks. Thanks very much. Look, I appreciate you all. It's a busy time of the year for everyone. I appreciate your attendance today and look forward to catching you up, not necessarily in person, but in Zoom, but hopefully in person in the near future. Take care, everyone. That does conclude our conference for today. Thank you for participating. You may now disconnect.