Please be advised that today's conference is being recorded. I'd now like to turn the conference over to your first speaker today, Mr. Paul O'Sullivan, Head of Investor Relations. Thank you. Please go ahead. Hello, welcome to the full year 2022 financial results briefing for Helia Group. I'm Paul O'Sullivan, Head of Investor Relations. This morning, we'll start with a presentation from our CEO, Pauline Blight-Johnston, who'll provide an overview of the results. Our CFO, Michael Cant, will then go into more detail on the financial results, and Pauline will then wrap up with closing comments. At the end of the presentation, we'll pass back to the moderator and take questions from investors and analysts. I'll now hand over to Pauline. Thank you, Paul. Good morning, everyone, and thank you for joining us this morning. Before I start, I'd like to acknowledge the Cammeraygal people of the Eora Nation, on whose land we're hosting our call today. I pay my respects to their elders past, present, and emerging, and to all Aboriginal and Torres Strait Islander people here today. Today, we're pleased to report another strong financial result for Helia in 2022, driven by a continuing low claims environment and high net earned premium. These results are the culmination of a year of significant progress right across the business. Over the past year, Helia delivered against our purpose of helping Australians to accelerate financial wellbeing through homeownership, helping over 69,000 people into homes, and perhaps even more importantly, helping 8,000 families to stay in their homes during times of hardship. Our focus on supporting the needs of homebuyers is resonating with customers as we continue to work alongside them to develop solutions to help Australians own property and live better lives as a result. This work is also delivering for our business and our shareholders, helping us to achieve a 100% customer retention rate in 2022, as well as winning two new exclusive customer relationships with BOQ and Bendigo and Adelaide Bank. Perhaps most visibly, we're now operating under a new name and a new brand that is more representative of our ambition. Our new name, Helia, is inspired by the sun. It reflects who we are and how we use our expertise, experience, and understanding to show people possibilities, to shine a light on solutions, and to create brighter outcomes. Building on our proud heritage of helping Australians achieve the dream of homeownership, just as we've been doing for more than 55 years, and driven by our purpose to accelerate financial wellbeing now and for the future. Particularly pleasingly, we've achieved all of this while delivering strong financial results and returns for our shareholders, demonstrating the business dimension we're building at Helia. I'll now turn to Slide 5 to walk through Helia's 2022 financial and business highlights. In 2022, Helia delivered a strong underlying net profit after tax of AUD 288 million, 21% higher than 2021, underpinned by a very strong underwriting result of AUD 362 million. Statutory net profit after tax of AUD 187 million was materially lower than underlying profit due to unrealized mark-to-market investment losses. The 2022 result had three key notable features. Firstly, net claims incurred of -AUD 35 million due to an exceptionally low claims environment. Secondly, significant growth in earned premiums despite reduced new business volumes as a result of strong new business in 2020 and 2021, as well as an unusually high level of policy cancellations. Thirdly, higher bond rates, which led to the divergence between underlying and statutory profit. In 2022, we continued to deliver on our strategic agenda to enhance, evolve, and extend our business to accelerate financial wellbeing through homeownership. We continued to see the benefits of our investment in better understanding the needs of our customers and their borrowers, retaining all customers and securing two new exclusive customer relationships. In the second half, we announced a new investment in Household Capital to help people stay in their homes whilst funding their retirement and completed the rebranding of the business to Helia, the final step in our separation from Genworth Financial. Over the year, we've continued to demonstrate a strong and resilient capital position, positioning the business well to navigate the changing economic environment and to continue to deliver returns to shareholders. This capital strength has allowed the Board to declare a fully franked dividend of AUD 0.14 per share and a fully franked special dividend of AUD 0.27 per share, taking total 2022 dividends to AUD 0.53 per share. It has also enabled the return of capital via on-market share buybacks totaling AUD 181 million over the year. We are pleased to announce today a further on-market buyback of up to AUD 100 million. The key performance measures on Slides 6 and 7 depict these results in graphical format. In particular, I'd call your attention to the underlying return on equity chart on Slide 6 and the capital management chart on Slide 7, which both demonstrate the growing momentum in the business and the resulting improvement in shareholder returns. Let's turn now to Slide 8 for a closer look at the economic environment. Over recent years, Helia has benefited from unusually favorable economic conditions. However, it won't have escaped anyone's attention that the economic environment is changing. Interest rates have risen sharply from their historical lows and are approaching previous serviceability floors. Of course, rates are still expected to rise further. This has led to a fall in house prices, with national home dwelling values falling 5.3% over 2022. In this environment, the resilience of the labor force has been encouraging. Unemployment is near historical lows at 3.5% in December, with participation rates near all-time highs. As the economy slows, unemployment levels are expected to modestly increase. Our expectation is that these continued economic pressures will lead to increased claims over the course of 2023. The business is well prepared for this changing backdrop, and Michael will go into more detail regarding this later in the call. Turning now to Slide 9, which provides a closer look at Helia's portfolio. Higher interest rates dampened the demand for credit and hence growth in new insurance written and gross written premiums at Helia during 2022. First-time buyer demand continued its fall during the year as falling dwelling values impacted sentiment and rising interest rates impacted affordability. New housing loan commitments in 2022 were 7% below those of 2021, perhaps more relevantly for Helia, high LVR lending fell 19% across the industry. The contraction in high LVR credit growth, together with the impact of the expanded federal government First Home Guarantee scheme, contributed to a decrease in gross written premium of 42% year-over-year from an extraordinarily high volume year in 2021. We're working closely with our lender customers to look for business growth opportunities in 2023 as the house price cycle is expected to bottom. Turning now to Slide 10, which provides an overview of industry refinancing activity. Whilst written premium was down in 2022, net earned premium was up due to a combination of previous book year growth and high levels of cancellations. Policy cancellations are economic value accretive for Helia and, under current accounting standards, also bring forward revenue recognition to the current year. A core focus of all industry participants is the scheduled roll-off of fixed interest rates over the course of 2023, and to a lesser extent in 2024. This is expected to provide a further catalyst for refinancing cancellations, whilst also generating some level of increase in delinquencies. Helia's portfolio is well-positioned to manage these forces, as shown on Slide 11, which we'll turn to now. Helia's portfolio is well seasoned and has significant levels of positive equity across book years, with an average effective LVR of 48%. All book years have benefited from rising dwelling values since origination, with the exception of 2022, which accounts for 7% of our in-force book. Whilst we expect the economic environment over the coming years is likely to be more difficult than we've seen in recent years, we are confident that Helia is well positioned to navigate this period, commencing from a robust starting point. Over the past decade, we have progressively tightened and refined underwriting standards. This refinement has continued during 2021 and 2022, with a particular focus on positioning our portfolio for an environment of rising rates. We've remained cognizant of the risk to the economy in our reserving since the onset of COVID, ensuring we have the financial resources to withstand a wide range of possible economic outcomes. Turning to Slide 12, I'm pleased to share with you the progress we've made on the delivery of our strategic agenda. Our focus on enhancing the existing franchise continues to pay dividends as we successfully retained all customers that came up for renewal during 2022, accounting for 73% of our premium income. As we advised at the first half, we converted two top 10 lenders that were previously shared with another provider to exclusive relationships, reinforcing our position as the leading provider of LMI in Australia. At the same time, we've continued to modernize our core technology, including the introduction of a new underwriting system and improved lender connectivity. We've also invested in our onboarding capabilities as we position the business to win new customers in the coming years. We've continued to focus on product evolution as we work with lenders to integrate new product offerings into their existing IT infrastructure. We remain committed to delivering more choice and options for borrowers, noting that take-up of these enhancements is likely to take time. Our Monthly LMI is in market with four lenders, Family Assistance is in market with 11 lenders, and we were pleased to introduce a new self-managed super fund offering to the market in December. All of this has contributed to an increase in Helia's Net Promoter Score for the fourth consecutive year to an impressive +77. In the second half, we announced a new partnership and investment in Household Capital, adding to our existing relationships with Tic:Toc and OSQO. These partnerships are intended to diversify our revenue base over time and contribute to medium-term growth, as well as delivering holistically on our purpose to accelerate financial wellbeing through homeownership. Additionally, conscious of our opportunity and obligation to make a positive contribution to the society of which we're a part, during the year, we revised our approach to sustainability, as outlined on Slide 13. In formulating our refreshed approach to sustainability, we've deliberately focused our efforts on those areas where Helia can have the greatest impact. Our three new sustainability pillars of driving financial well-being and housing accessibility, enhancing climate resilience, and good corporate citizenship set the framework for our sustainability goals, priorities, and reporting. They capture our commitment to important ESG risks and opportunities, and will guide our business in setting sustainability initiatives and targets for the future. Moving to Slide 14, we'll now look at capital management. Our strong financial and capital position enables Helia to both invest in the future of the business and to deliver immediate value to shareholders through dividends and capital returns. During 2022, Helia returned AUD 143 million of capital to shareholders via dividends and bought back AUD 181 million of shares through on-market buybacks. Despite this active capital management program, strong profitability and high levels of cancellation saw the PCA coverage ratio rise to 2.22x as at December, well above the Board's target operating range of 1.4x-1.6 x. In recognition of this strong financial outcome, this morning, the Helia Board declared a fully franked ordinary dividend of AUD 0.14 per share and a fully franked special dividend of AUD 0.27 per share, taking total dividends in respect of 2022 to AUD 0.53 per share. We are also announcing today a new on-market share buyback of up to AUD 100 million to commence in March. We previously indicated that our aim was to seek opportunities to bring Helia's capital position to within the Board's targeted range of 1.4x-1.6x PCA within two years. Given the strong profitability and capital generation over 2022, our current expectation is to be back within the Board targeted range by the end of 2024, post the payment of declared dividends. I'll now hand over to Helia's CFO, Michael Cant, who'll provide more detail on our financial results. Thank you, Pauline. Welcome to everybody on the call. Thank you very much for joining us today. I'm gonna start on Slide 16 with the income statement. Underlying net profit of AUD 288 million was a very strong result. The statutory profit was also healthy, but below underlying profit due to unrealized losses on the investment portfolio. The drivers of these full-year results were very similar to those in the first half. Gross written premium was well down, impacted by slowing industry volumes, particularly for high LVR lending. Net earned premium grew by 15%, mainly due to continuing high levels of policy cancellations. The claims outcome for the year was again exceptionally low and reflected a very benign claims environment. Investment income was - AUD 85 million due to sizable unrealized losses on the bond portfolio from rising interest rates in the first half of the year. Slide 17 has some further analysis on the top line. New insurance written for the year was down 36%, largely reflecting a drop in industry new lending volumes, particularly for high LVR lending. The federal government's First Home Loan Deposit Scheme has also had a negative impact on the volume of LMI written. The fall in new insurance flowed through to gross written premium. GWP was also slightly negatively impacted by a lower mix of business in the high above 90% LVR category and reduced premium rates for a few customers. Net earned premium was up 15%, as I said before, benefiting from high cancellations. Cancellations bring forward the release of unearned premium, and the revenue contribution from this source was unusually high due to high levels of loan refinancing activity in the industry. The strong NEP results also reflect a particularly high levels of gross written premium in 2020 and 2021, and these cohorts are now coming into the peak years of the earnings curve. I'm now gonna turn to Slide 18 on claims. Net claims incurred were -AUD 35 million. That is, a credit to the bottom line. This outcome was driven by low claims paid of AUD 28 million and a AUD 63 million reduction in reserves. Paid claims and mortgages in possession continue to remain low, and this is a function of both the favorable economic environment, but also the savings buffers that were built up during the COVID period. The COVID moratoriums on foreclosures are still having an impact on the volume of late-stage delinquencies, and these moratoriums have clearly now come to an end, and consequently, we do expect to see increases in both mortgages in possession and claims paid in the year ahead. This has been fully anticipated in our reserves. Slide 19 contains some more analysis on claims. Delinquencies continue to fall, with improvements across most parts of the portfolio. Closing delinquencies are now at their lowest level since 2014. New delinquencies remain particularly subdued as a result of the favorable economic environment, and particularly the strong employment market. Net aging, that is cures less aging, had a positive financial impact of AUD 109 million. This is a consequence of the strong labor market, healthy borrower finances, and house price appreciation in recent years. Our reserving basis has been fairly stable for the last two years, and over the full year, the impact of changes in the actuarial reserving basis was relatively minor, with only a AUD 10 million release. I'd now like to turn to Slide 20 on investment returns. Total investment income for the year was - AUD 85 million, representing a return of -2.4%. The big driver of the overall investment result were unrealized losses of AUD 140 million, mainly due to rising bond yields. We typically hold our fixed interest assets to maturity, so the impact of the unrealized losses will unwind as the bonds mature over coming years. Higher interest rates are positive for the long-term profitability of our business. This can be starkly seen in the higher running yields on our portfolio, which have risen over the year from 1% to 4.3%. On an asset base of over AUD 3 billion, this adds significantly to revenue. Slide 21 has some further detail on the impact of changes in interest rates. As you're no doubt aware, the year saw a dramatic rise in interest rates, particularly in the first half. This has caused significant mark-to-market losses on the investment portfolio. On the flip side, higher rates have an offsetting impact on the value of the insurance liabilities, particularly as we adopt a matched investment portfolio. Due to the fact that the accounting liabilities are not discounted, changes in interest rates do create volatility in our income statement. The matched investment portfolio ensures much more stability in our solvency position and the underlying economic value, as can be illustrated in the chart on the right of the slide. I'd now like to move from the income statement to the balance sheet on Slide 22. Investment assets were down due to a combination of the fall in market values, plus the substantial quantum of capital returned to shareholders over the year. Deferred acquisition costs at the end of 2022 were AUD 115 million, an increase of AUD 27 million over the year, reflecting the capitalization of new DAC post the write-off in the first half of 2020. Unearned premium has decreased by AUD 168 million, reflecting both the high cancellations and low volumes of new gross written premium in the most recent year. I'd now like to take a look at the composition of our investment portfolio. The asset allocation in our portfolio varies between the technical funds backing the insurance liabilities, and the capital in the shareholder funds. The technical funds are invested entirely in fixed interest assets, which are matched to the liabilities with a duration of 3.1 years. The fixed interest portfolio backing the shareholder funds has a much shorter duration of only 0.7 of a year. This portfolio has benefited significantly from the rising yield environment. The shareholder funds have a higher risk return profile, with approximately 21% of these funds invested in equities and infrastructure. The shareholder fund portfolio also has a greater allocation to corporate credit designed to enhance overall returns. I'm now gonna turn to Slide 24, which has a breakdown of the outstanding claims liability. The total outstanding claims liability of AUD 416 million reduced by AUD 65 million during the year. This reduction was largely a function of the low level of delinquencies. Since the onset of COVID, the average reserve per reported delinquency has been relatively steady at approximately AUD 40,000, and this reflects a degree of stability in our reserving basis. The fall in the absolute level of reserves in recent periods is largely a function of the number of delinquencies, not assumption changes. The reserves do incorporate allowance for future house price depreciation of a further 10% over 2023. In addition to the drop in the liability for reported delinquencies, there was a slight reduction in the reserves for IBNR and future re-delinquencies. Our reserving basis was strengthened significantly during 2020. Since that time, the reserving basis has remained relatively stable. We are comfortable that our reserves are appropriate for the economic environment that is ahead of us. Slide 25 looks at the regulatory capital position. The regulatory capital base fell by AUD 159 million over the year, reflecting the substantial capital returns during the year. At the same time, the APRA PCA requirement fell by AUD 154 million due to lower GWP and high cancellations. As Pauline noted, our capital position remains very strong, with a ratio of 2.22x PCA. The composition of our capital base is much the same as in prior periods, with AUD 190 million in Tier 2 capital, approximately AUD 300 million from the surplus relating to insurance liabilities, and the balance in Tier 1 equity capital. Please now turn to Slide 26, which looks at the movement in capital over the course of the year. Despite the return of AUD 322 million in capital through dividends and share buybacks, the PCA ratio increased to 2.22 x due to the drop in regulatory PCA requirement. The PCA ratio benefited from the run-off and ceasing of the in-force book, which was greater than the capital strain on new business. In aggregate, our business is generating large amounts of organic capital, and we expect this dynamic to continue. The capital position remains well above the Board's target range even after the final dividend and proposed buyback, highlighting scope for further ongoing capital management. As previously noted, we anticipated getting back into our target capital range by the end of 2024 after payment of the final dividend. Please now turn to Slide 27 on reinsurance. Reinsurance is an important part of our capital mix, as well as risk mitigation in extreme stress scenarios. Historically, we've placed approximately AUD 800 million of reinsurance via a whole of portfolio cover that was typically canceled and rewritten each year. After careful consideration, we've commenced the transition to a book year program of reinsurance. Book year reinsurance provides cover for a cohort of business over the life of those loans. There are several advantages of the book year cover, most notably including reduced renewal risk. Over time, we also expect the book year cover to have lower costs than our previous reinsurance programs. The book year cover will build over time, and as this happens, we will gradually phase out the back book cover. We expect to place a similar amount of reinsurance as to what we've done historically, approximately AUD 800 million, noting that the quantum may flex in response to changes in the APRA PML. I'd now like to spend a little bit of time on the outlook for 2023 and beyond. Despite the interest rate rises over the last nine months, delinquencies have continued to fall, which is consistent with the trends seen across the industry. We do expect that the combination of higher rates and cost of living pressures will see delinquencies rise in 2023. This will be exacerbated by the high volume of fixed rate loan maturities rolling onto higher rates. Notwithstanding some of these headwinds, the portfolio is very well-placed coming into a more challenging period. Starting delinquencies are at record lows. The strong house price appreciation from 2019 to 2021 has meant most borrowers have good levels of positive equity. Many households built up substantial savings during COVID-19, which can and are being drawn upon. Importantly, we took proactive steps to tighten our credit settings in the second half of 2021. At our half year results, we shared some information on the expected sensitivity of our future claims to the economic environment. I've provided some updated information on this on Slide 29. Over the last two years, claims incurred have been exceptionally low. Economic conditions have clearly changed significantly in 2022, with significant rises in interest rates and resulting falls in house prices. Looking forward for 2023, most economists are now forecasting further rises in the RBA cash rate, taking it to approximately 3.85% by middle of the year. Further house price falls of approximately 10%, which would represent a peak trough fall of 16%, but with unemployment remaining relatively low and under 4.5%. Under that economic scenario, we expect claims incurred for 2023 to increase towards long-term average levels. While rising interest rates and falling house prices will negatively impact claims, the magnitude is moderated by the house price appreciation of recent years, combined with relatively low unemployment. The slide also shows the sensitivity of claims to different economic variables, using a three-year sensitivity for each of house price appreciation, interest rates, and unemployment. While the economic environment outlook is expected to lead to higher claims, our expectation is that unless there is a major jump in unemployment, claims incurred over the next few years will be in line with long-term average levels. On Slide 30, I've provided the most recent view of profitability by book year. You'll recall this is a chart that we've shared at the last two half year results. The chart on the top left of the slide shows the cumulative loss ratio to date by different book years, and this cumulative loss ratio should be indicative of the ultimate profitability of the different cohorts. The book years have been grouped into cohorts which have broadly similar loss experience. Book years 2008 and 2009 were very unprofitable, with a loss ratio to date of 73%. At the time these cohorts were written, credit standards in the industry were much weaker than today, and LMI pricing was significantly lower. The cohort of business from 2010-2014 was adversely impacted by the mining boom and bust in regional Queensland and Western Australia. Other states have performed well. The book years from 2015 onwards are showing much more profitable loss ratios, reflecting better pricing, better underwriting quality, geographic mix, and to date, a lack of any major claim events. Loss ratios for the 2021 and 2022 cohorts are also low, but are not shown as they have not had sufficient time to develop. Given the recent fall in house prices, we would not expect the loss ratios for the last two book years to be as low as those for the 2015-2020 cohorts. Another useful way to look at the different cohorts is to consider the quantum of embedded profits in the existing book. The excess of unearned premium over the premium liabilities represents expected future profits from the current in-force portfolio. As you can see from the chart, the vast majority of embedded profits relates to cohorts since 2015. Over time, the dynamic of the run-off of the old cohorts and replacement by more profitable business since 2015 is leading to an improving return on equity across the whole business. Before finishing my section, I wanted to quickly touch on AASB 17, which is the new accounting standard for insurance. In November, we held an investor update on AASB 17 and its impact on Helia. We continue to make good progress on preparations for the introduction of the new accounting standard. We have refined our estimate of financial impact of the change in accounting standard. We now expect the transition to AASB 17 to result in a reduction in net assets in the range of AUD 210 million-AUD 270 million. This transitional impact is due to timing differences in the recognition of revenue under AASB 17 compared to the previous accounting standard. The accounting impact is expected to be of a similar magnitude, with reduced volatility. Importantly, the introduction of AASB 17 is not expected to have any material impact on our capital requirements. Importantly, the economic fundamentals of the business are unchanged. We will be reporting on the new accounting standard from the year 2023, and expect to provide a further update in the second quarter, including pro forma income statements and balance sheet. I'd now like to hand back to Pauline. Thanks, Michael. As we look to the future, we're confident that Helia is well-positioned to navigate the changing economic environment and to continue to deliver its purpose of accelerating financial wellbeing to homeownership. Turning to Slide 33, outlook and full year 2023 guidance. As we've expressed a number of times today, over the course of 2023, we expect to see continued upward pressure on interest rates with resultant impacts on Helia's new business claims and investment returns. New business is likely to remain subdued, whilst earned premium will be driven by previous book year premium volumes, as well as the level of cancellations. Incurred claims are expected to increase over the year towards long-term averages. Offsetting this, net interest and dividend income will benefit from higher interest rates, noting the 4.3% running yield at the end of 2022. Dividends are expected to be sustainable at AUD 0.26 per share, with some scope for growth over time. We are currently expecting returning to the Board target range of 1.4x-1.6 x PCA by the end of 2024 after the payment of the 2024 declared dividend. Turning to Slide 34. We're proud of Helia's position as Australia's leading LMI provider and the positive momentum the business has built over recent years, particularly as evidenced by success in winning new customers. We serve a large and growing addressable market with significant levels of unmet demand for access to housing. We're positioned for profitable growth, delivering returns in excess of our cost of capital, creating value for our shareholders. This sustainable return on equity, combined with capital releases from the back book, allows the business to deliver ongoing capital management for shareholders while still investing in our strategic agenda. All this in combination has enabled Helia to deliver superior total shareholder returns since listing, the second highest amongst our banking and insurance peers over the period of 2014 to 2023. Helia is excited to be at the forefront of helping Australians to buy homes today and for the future. We are energized by the diverse range of alternative homeownership solutions we're working to deliver to help meet the growing need in Australia, and we remain confident of the business opportunity that this will create. We're proud of the momentum we're building and are pleased this has been achieved alongside strong underlying financial results today, allowing us to continue to deliver on our commitment to effective capital management for the benefit of our shareholders. On behalf of the Board and my fellow leaders, I would like to thank all of the people at Helia for joining us on this journey and making it your own. Today's results are a reflection of your unique contribution and passion for homeownership in Australia. Finally, thank you to all of our shareholders for your ongoing support and commitment to Helia. Without you, nothing would be possible. With that, I'll open up to any questions. Thank you. Thank you. We will now begin the question and answer session. As a reminder, to ask a question, you will need to press star one one on your telephone. Please stand by while we compile the Q&A roster. One moment for the first question. First question comes from the line of Simon Fitzgerald from Jefferies. Please ask your question. Morning, Pauline. I just wanted to start a little bit about the guidance statements for FY 2023. Company mentions that net claims are expected to return towards long-term average levels. Just wanted to know what this is referring to. Is it loss rates, average dollar value of net claims or number of net claims incurred? I guess I say that remembering that, you know, loss rates have been distorted by changes in the earnings curve a couple of occasions right off of the DAC, reserve releases exceeding claims costs, et cetera. I guess, you know, what exactly are we looking towards in terms of, you know, the longer term shift towards net claims, if you can help us out a bit more there, please. Sure. Thanks, Simon. I'll make a couple of comments and then I'll throw to Michael, who no doubt will add some more color. Sure. As you know, you know, none of us have got a crystal ball and claims the volume, the amount and timing of claims is notoriously difficult to predict. Timing even more difficult to predict than the amounts that may come through. What we're trying to say there, and we've been giving the same message in the last few lots of results announcements, is that as we look to the increasing interest rate environment and as we look to the fixed rate rolling off, and people have talked a lot about what that may mean, all of our modeling indicates that that environment will take us about back to the level of claims we've priced for, as opposed to being a major event that goes beyond that. That's really what we're trying to say there. I think it's probably best to think about it as a, as a long-term average loss ratio rather than a particular dollar or number of claims. Michael, you still want to add to that? Even though those loss ratios have been distorted by a couple of things that you've done in the past in terms of changes in the earnings curve and, you know, right off of the DAC. I think once you've said before, you set the business up for about a 30% loss rate, is that still relevant? Michael? Yeah. Simon, on the last, I mean, the earnings curve and the [rec gov] may impact in the short term, if you look over, you know, the longer term history of the business and look at loss ratios, I think, you know, that they're still representative of what we would call long term and what we price for. Yeah, we have said in the past, I think something in that sort of 30%-35% range is pretty normal for the long term and also roughly where we'd be pricing towards. Yeah, that's helpful. Next question is just about looking at the average paid claims. Quite a jump in the second half versus the first half. I understand it's only over 153 claims, but the average paid claim was AUD 106,500, and that compares to, I think, a peak that I've seen in the past of about AUD 113,000. It skipped up from about AUD 57,000 onwards. I'm just wanting a little bit of clarity in terms of what might be the driver there. Is there some postcodes involved here, or is this really the start of a reflection of, you know, falling dwelling prices coming through? Um. I'm happy to have a go, yeah. The first thing I'd say is it's on very small numbers, paid claims. That's the first thing I'd say is I'd be cautious drawing too much to either the particularly low average paid claim in the first half of 2022 and the higher average paid claim in the second. If you look across the full year, it's reasonably in line with the years before that. The size of the average paid claim, very much a function of the geographies where we pay claims. Our paid claims are still disproportionately represented by areas in the mining. If we get a few large claims coming out of mining areas, that particularly on small numbers, that boosts the average. Yep. Okay, that's fair. Just one more question here then. Just in regards to the central estimate, the decrease in the, I think it was the IBNR or the, w hat's the level I'm referring to? It was a decrease from AUD 410 to AUD 355. There was a note in the accounts that talks about the IBNR. The central estimate is what I'm referring to. I just wanted to know a little bit about the economic assumptions behind that central estimate, just given it's decreased in an environment where you're talking about claims picking up. Just to clarify, the bulk of the drop in the reserves has not been Incurred But Not Reported. The bulk of the drop in the reserve relates to the reported delinquencies. That's largely a function of you take the delinquencies, we look at the economic outlook and the past sort of roll rates on those delinquencies. That's how that number is calculated. The IBNR, which is a smaller component of the reserve, that's intended to pick up the by definition, the claims that have or delinquencies that have been incurred, but we haven't yet been notified of. Almost by definition, the fact that delinquencies are been so low, you would expect to have a low quantum of IBNR for the period. Yep. That. You are. That second change is the minority and I think only contributed about AUD 10 million to the reduction in reserves. The overall economic environment that we factored into in the calculation of the reserves is consistent with the economic scenario that we outlined on Slide 29. A further rise in interest rates, another 10% drop in house prices, and modest pick up in unemployment. That's very clear. Thank you very much. Thank you for the questions. As a reminder to ask question, please press star one one on your telephone. One moment for the next questions. Next up, we have the line from Andrew Lyons from Goldman Sachs. Please proceed. Thanks. Good morning. Pauline, just a high-level question on your reserving, and you did sort of go into it in a bit of detail in response to Simon's question. When you were talking to Slide 8, just on the macroeconomy, you noted that the macroeconomic environment had been a tailwind for the business in recent years and now things had somewhat inflected given interest rates, et cetera. Yet despite this, obviously your overall reserving is at the lower end of the levels from the last three years. Obviously I recognize the conservatism of the inputs that go into your reserving and they're reflected on Slide 29, but just keen to sort of reconcile your comments on the macroeconomy, I guess inflecting versus just those lower levels of reserves versus the last couple of years. I'll again give some overall comments and I'll pass to Michael for a little bit more detail. As Michael said, the lower reserving is only in respect of delinquencies on the books at the moment, and we just have a very, very low level of delinquencies. That's what's coming through. From a big picture perspective, the way I think about it is, at the beginning of COVID, we put aside some reserving for an economic scenario that might have been a little bit ugly. Of course, we saw what happened. The government effectively propped up the economy for a couple of years by pumping money into it, and we didn't see that scenario eventuate for that period of time. Now, the scenario that we're looking at is very similar to the scenario that we reserved for back at the beginning of COVID. The reserves we put aside for this eventuality, that's what looks like we're now looking at. It makes sense to me from that perspective. As I said, in the meantime, we had a number of years of strong house price appreciation and low delinquencies and strong employment, which is very important for our portfolio. I'll get Michael to add some more color to all of that. Andrew, probably the only extra thing that I would add is that what we reserve for and what we're allowed to reserve for under the accounting standard is for existing delinquencies, potential incurred but not reported delinquencies and also we also reserve for loans that have in the past been delinquent but and now healthy, but could go delinquent in the future. And we factor in the prevailing economic environment and the outlook into the appropriate amount to hold for each of those three categories. What we don't and can't reserve for is future delinquencies on loans that have that are healthy today and have always been healthy. Again, that's probably a little bit different to some of the provisioning at a bank level. Certainly, we, you know, take into account the economic environment, and I want to say here that the more challenging economic environment and the reserves we set aside for those first three categories, we can't and don't set aside reserves for what might happen for future delinquencies. Well, I mean, they're implicitly there in the net earned premium in the unearned premium. Yeah. The earnings curve. Yeah. To the numbers in Slide 24, where you can see those outstanding claims reserves coming down, they are primarily in respect of notified delinquencies. Also we have had a decrease in volume, which will also be impacting our net earned premium curves. That as someone who's first and foremost a banks analyst that does help appreciate. You are saying that your ability to do what are called management overlays at banks is more difficult under the accounting standards for you that you guys are subject to. Is that correct? We have no ability to put in place effectively what a bank would call a collective provision and to increase and decrease those. Okay. Just a second question, which you've heard from me before, but I'm gonna push again. It's just you've reported a 19% ROE today. That's despite significant surplus capital. Obviously investment yield is running well below your running yield, albeit offset by a much lower than normal claims ratio. Just in light of all of that, you know, does the group believe current pricing and interest rates can allow the group to sustainably deliver a low to mid-teens ROE? We do believe that, I believe we've said that before. I'm a little bit paused to what we have and haven't said before. Yes, we do believe that the group is in a position to deliver a sustainably better ROE than what it has over the past. Thank you very much. Thank you for the questions. We have a follow-up question from Simon Fitzgerald, from Jefferies. Please go ahead. Hi, Pauline. I just wanted a little reminder of the sort of lag effects that we get in this business from, say, 181 days onwards. It obviously takes time for a bank to give a property owner a notice of possession. It takes time for them to obviously put that property up for sale. There's a time or period after that in which Helia would get a claim. Can you sort of help me out? You know, just remind me in terms of the timeframe beyond 181 days where, you know, all that sort of happens, and is it taking longer under these circumstances than you would normally think? Yes. Again, I'll make some comments and then Michael may add anything I've missed. Typically, you're right. In normal times, it might take around about a year from the time someone goes delinquent until the time the property is sold. Given the COVID moratoriums we've seen in recent years, that timeframe has extended materially in the last two years. Our reserving is largely agnostic to the date of which that event happens, the foreclosure happens. We begin to reserve it in outstanding claims from 90 days in arrears, and we have probability factors that we will pay a claim. As the delinquency ages, those probability factors adjust, so getting closer and closer to the time that the claim is actually paid. By that point, our estimate's pretty close. With also the change of the reserving some years back that you did as well, even if that property owner were to be cured, that reserving would stay, would it not? Not the whole level, but we allow for every delinquency that gets cured. We set up what we call a re-delinquency reserve because they have a high propensity to in the future, which is at a lower level. Yeah. Great. Thank you. Thank you for the questions. As a reminder, to ask question, please press star one one. We appear to have no questions at this time. Allow me to hand the call back to the management for closing. Thank you. Thanks, everyone, for joining us this morning. We really are proud to share with you what we delivered in 2022. We're pleased to be delivering strong financial results, strategic progress, and most importantly, to be sharing the benefits of that with you as shareholders via dividends and capital returns. We've talked a fair bit today about the fact that the environment next year is different. That does have an impact on our accounts. We expect that to come through and to see the impact of that in our claims line as well as in our investment return line going forward. We believe, and we hope we demonstrated today, that we are well-placed and well set up to navigate this environment, and we look forward to therefore being able to continue to deliver on the strategic agenda and financially for our shareholders through the coming periods. Thank you for your time today. This concludes today's conference call. Thank you for participating. You may now disconnect.