Good morning, and welcome to the Judo Bank Result Briefing for the full year ending 30th of June 2023. My name is Andrew Dempster, and I'm General Manager of Investor Relations at Judo. I'd like to begin by acknowledging the traditional owners of the land that we're meeting on today and pay my respects to elders, past and present. Our result material was lodged earlier this morning with the ASX. The material is also available on the investor section of the Judo website. A replay of this session, including the Q&A, will be available on our website later today. For today's agenda, as well as taking you through our FY 2023 result, we have also brought forward a deep dive on the credit quality of our portfolio. First up, we'll hear from our CEO, Joseph Healy, who will start with an overview of the result. Our CFO, Andrew Leslie, will then discuss our financials in detail. Joseph will then return to discuss credit quality as well as the outlook. After the formal presentation, there'll be time for questions with Joseph, Andrew, our Deputy CEO and Chief Relationship Officer, Chris Bayliss, and our Chief Risk Officer, Frank Versace. Thank you, and I'll now hand over to Joseph. Thank you, Andrew, and good morning to everyone. We're very pleased with presenting another strong set of results. Judo is a unique, pure-play specialist SME bank, and our purpose is to be the most trusted SME business bank in Australia. A significant market opportunity exists for Judo, which we have been clear about since day one. In our view, the SME economy has been underserved by a banking industry that had industrialized and de-skilled. The craft of SME banking had been lost, replaced by a product sales culture. Our strategy is to address what we saw as a market failure, and this has been consistent since our first information memorandum back in 2016. We continue to run our own race and execute our strategy, working towards our vision of becoming a world-class SME bank. While a relatively new bank, our management team and board have over 300 years of collective experience in business banking. When we received our banking license just prior to the pandemic, so in effect, we are a bank born in uncertain times. The experience of our team and the progress we've made, despite the operating environment, gives us great confidence that we will continue to execute our strategy. Let me briefly remind everyone of the three horizons of Judo's evolution. We have completed horizon one of building a bank, and we're now well into our second horizon of scaling the bank. The third horizon is achieving our vision of being a world-class SME bank. By world-class, we mean that we will achieve our metrics at scale, including a low to mid-teens ROE, and we will continue to deliver above-system growth, underpinned by our market-leading NPS and engagement scores, as well as a disciplined management of risk-reward economics. Our management philosophy is an and, not an or. In other words, we will grow our business and manage margin and operate within a good risk appetite. We have no appetite for trade-offs between growth, margin, and risk. We will manage this equation carefully in the challenging environment that will define the year ahead. Our NPS and employee engagement scores are strong, and as we discussed at our technology deep dive on 1 May, we are now making significant investments in scalable technology to sustain our current performance and drive ongoing improvements in our unit economics. This will enable our bankers to more easily deliver the core elements of our customer value proposition, service, speed, and exercising judgment to meet the needs of our customers, not a rigid, one-size-fits-all, black-and-white policy approach. Moving now to the highlights for FY 2023, which has been a truly seminal year for Judo. Our loan book has grown by AUD 3 billion to now over AUD 9 billion. The continued scaling of our business has produced a profit before tax of AUD 108 million, a sevenfold increase. We achieved profitability faster than any other challenger bank we know of, just 4 years after receiving our banking license. In achieving our loan book of AUD 9 billion, we are now halfway to our GLA metric at scale. Our growth has been driven by a continued demand for our relationship-based approach to meeting the financing needs of the SME economy. To match our lending growth, we have established a strong funding base. We have continued to grow our term deposit franchise, underpinned by improving brand recognition. Our TD margins in the second half remained below our through-the-cycle assumption. We've also established a very strong wholesale funding base, and today we're announcing that we have AUD 3 billion in committed warehouse lines. This is more than our original target of AUD 2.5 billion, with a new AUD 500 million facility signed in July. Importantly, AUD 2.1 billion of capacity remains undrawn, giving us huge amount of flexibility ahead of the full repayment of the TFF. We've also made significant progress with technology, including the rollout of our digital banking for lending customers and completing the building of our new data platform. We have also continued investing in our origination systems, providing our relationship bankers with improved functionality and reporting. Turning to a summary of our financial results. We have met or exceeded all of our FY 2023 guidance metrics, a s I have just mentioned, we've grew the loan book by AUD 3 billion in FY 2023. Our underlying NIM for the year was 3.53%, well above our guidance of over 3%. Our CTI was 54%, ahead of our guidance of below 60%, and a significant improvement from 76% last year. Our cost of risk was AUD 55 million, the midpoint of our guidance range. The outcome of these results is a net ROE of 5.1%, which given our stage of maturity and our elevated levels of capital, is a highly credible outcome. We have said before that we believe passionately that specialists beat generalists every single time, and I believe that these results provide a sense of the potential and the inherent benefit of scale embedded in our unique specialist business model. We are running our own race towards our vision. A key element of our success is our strong customer value proposition, and demand for our relationship-based approach continues to draw us into new markets. We now have a presence in 18 locations, with four new locations having opened in FY 2023. We continue to recruit experienced bankers, as well as training our own bankers through our in-house apprenticeship program. As a result of this program, we have had 15 banker promotions to date. These homegrown bankers know our culture and the Judo way of banking. We have also accredited over 1,200 commercial brokers and continue to grow our broker network. As mentioned a moment ago, our lending NPS has been maintained at an exceptionally high level of +65, versus a sector that achieves single digits at best and more often than negative. Next to our current credit quality. As expected, we have seen an increase in our 90 days past due in impaired assets. We consider this a normalization of credit quality of an ultra-low base. In fact, 12 months ago, our arrears and impaired metrics were unsustainably low, and they would likely increase closer to industry norms as our book matures. We do recognize that there are no direct comparisons for Judo in the market to contextualize the normal level of SME credit quality. We have, however, analyzed other domestic banks' disclosures and estimate that a comparable SME sector, 90-days past due and impaired loans, are currently around 2% across the industry. As you can see, our current level of arrears and impaired SME loans remains well below sector levels on a like-to-like basis and well within our planning assumptions. We do expect that arrears and impaired metrics to continue to increase as our loan book seasons and as a result of challenges for certain sectors. The majority of customers that face challenges are resolved with asset sales, additional equity contributions, refinancing out to other lenders, or their business recovers. In terms of our ultimate cost of risk, we have assumed that an at-scale cost of risk will be 50 basis points. This is very conservative, given historical industry data. Our cost of risk includes a considerable level of write-offs, as well as an ongoing increase in collective provisioning as we grow. To underscore how conservative this number is, arrears and impaired loans would need to see 3% for our cost of risk to go above 50 basis points. Of course, some losses should be expected. However, we have only had two customer write-offs in our history. Later in this presentation, I'll provide more information on the exposures we have to sectors that the market is understandably interested in. Moving now to provisioning, and while we expect that arrears and impaired levels to increase, we have an appropriately prudent collective provision. The chart on the left shows Judo has collective provisioning that is comparable to the advanced accredited banks and is far higher than any other standardized bank. Further, on the right-hand side, we show that, as a result of the economic overlay we raised this year, provisioning for vulnerable sectors is almost 30% above the rest of our portfolio. Our collective provision is based on a conservative economic assumption, and I will cover our economic outlook in more detail later on. Before passing to Andrew, let me quickly summarize the key points I've covered so far. First, FY 2023 has been a very strong year for Judo, and we delivered on all our guidance metrics. Second, we are on track to achieve the metrics of scale, and we now reach the halfway point. Third, we are in horizon two of scaling the bank and investing in technology to better enable our bankers and customers and drive industry-leading unit economics. Fourth, our asset quality remains robust, remaining within our long-run expectations and below the sector. Lastly, our management philosophy is one of and, not or. We will manage growth and manage margin and manage risk. I will come back later to talk about the operating environment and our outlook, but in the meantime, let me pass over to Andrew. Thank you, Joseph, and good morning, everyone. I'm very pleased to be here today to present Judo's full year 2023 result, our second full-year result as a listed company. This has been another great year for Judo. Our headline result for the year is a profit before tax of AUD 107.5 million, which is 7 times the PBT generated in FY 2022. Lending volumes and margins both grew strongly, contributing to revenue that more than doubled over the year. Expenses increased 45% to support this growth and to invest for the future, resulting in CTI reducing by 22 percentage points, with overall very positive jaws. While we've seen an uptick in our level of 90 days past due and impaired, this is in line with expectations and reflects a normalization from the ultra lows of FY 2022. Importantly, we maintain a prudent provisioning coverage level, now at 121 basis points. As Joseph highlighted, we've met or exceeded FY 2023 guidance and remain on track for our key business metrics at scale. We've seen another half of strong growth across all lending product lines. GLAs were a touch short of AUD 9 billion at June 2023, and we subsequently crossed our FY 2023 target of AUD 9 billion in the first half of July, and anticipate closing August at AUD 9.3 billion. On top of the GLA balance, our undrawn lines of credit now sit at AUD 241 million. We hold liquidity and provisions on those balances, but also earn fee income. Portfolio parameters remain stable. 10% of our book is on fixed rates, and security levels remain broadly unchanged, with 86% of our portfolio fully or partially secured by real property. Turning now to margins. On this slide, we show the key drivers of underlying NIM since December through to June 2023. A reminder that underlying NIM excludes the impact of our TFF preservation strategy. Given underlying NIM has now largely converged with NIM, going forward, we will retire this metric. Underlying NIM for the second half was 3.49% and came in at the top end of our 3.3%-3.5% guidance range, provided as part of our trading update in May. This is a touch lower than the underlying NIM of 3.56% for the first half, driven by several key components. Firstly, cost of deposits was a 19 basis point drag, reflecting the higher costs of new and existing deposits over the half. While new deposits were originated at a margin of 74 basis points over BBSW, compared to 47 basis points over the first half, this was under our through the cycle assumption, being an average of 80-90 basis points over BBSW. Other costs of funding was a 17 basis point drag, predominantly reflecting a higher drawn warehouse balance and the impact of commitment fees on total warehouse funding limits. Lending margin was a 7 basis point drag, with some competitive pressure driving lower margins on new originations and proactive repricing due to improving customer credit. Over the half, the TFF contributed a 6 basis point increase and equity contributed a 17 basis point increase, reflecting the benefit of rising rates on fixed rate funding. Finally, treasury and other contributed a 13 basis points increase, reflecting modestly lower liquidity and favorable funding mix over the half. Next, to funding mix. Term deposits remain our primary source of funding for loan growth and now sit at AUD 6 billion, having grown by about AUD 700 million over the half. This follows a AUD 1.2 billion increase in TDs over the first half, where we took advantage of favorable conditions to get ahead of our funding task. The TD growth predominantly came through the direct retail channel, which was supported by the recent launch into Direct SMSF and Direct Business channels. Intermediated channels also grew over the half, albeit to a lesser extent. Drawn funding from warehouses increased by close to AUD 500 million over the half, predominantly reflecting the seeding of new facilities and funding for growth. As Joseph mentioned, we lifted our committed lines to AUD 3 billion in July, giving us increased capacity for TFF repayment and flexibility against term deposit competition. In addition, we believe we've now proven our ability to access largely the same wholesale funding sources available to much more established banks. We executed our inaugural public senior unsecured benchmark deal in September 2022, and our second Tier 2 transaction in June 2023. I'd now like to make a few comments on our transition to our longer-term funding stack. The TFF has been an important source of funding, helping us to support the SME economy. We are well advanced in our plans to repay the TFF and transition to our long-term funding stack. An important point to note is that there will be a timing difference between refinancing the self-securitized lending under the TFF and the contractual repayment, which will result in continued elevated liquid assets during FY 2024. Note, we've included some additional disclosure on our liquids portfolio in the appendix. As previously flagged, at scale, we expect our funding mix to broadly comprise 70%-75% deposits, 15%-20% wholesale debt, and 10% equity. We've made considerable progress towards these targets and remain confident in our ability to achieve them. At scale, we will represent broadly 1% of the system for term deposits, and with AUD 3 billion of committed warehouse lines now in place and close to AUD 1 billion in other wholesale debt, our at scale wholesale funding needs are now largely in place. Term deposits remain the core of our funding strategy, and over the second half, we continued to see strong deposit growth executing on our strategy, despite significant headwinds and market disruption, including some offshore bank failures and TFF refi-led deposit competition. Despite all these pressures, second half margin on new TDs was 74 basis points, below our through-the-cycle assumption, being an average of 80-90 basis points over BBSW. While in the first half of FY 2024 to date, we've seen margins tick back up to the top end of the range, we remain comfortable with our through-the-cycle assumption. Importantly, we've been steadily building our brand in the CD market, and as a nimble player, we have the ability to work through periods of volatility with flexibility across tenors and channels to optimize volume and margin. As noted earlier, we did see a little pressure on lending margins this half. Importantly, however, we compete primarily on service, not price. We continue to earn at least a 50 basis point premium relative to other banks for our relationship-based approach, our speed, and our unique judgment-based model. We have observed some unsustainable pricing in the SME space over recent halves, in particular, in larger property deals, that we believe has been driven by temporary funding cost tailwinds and comparatively poorer returns for other banks in mortgages. The other driver of our lower lending margin included repricing for existing customers. As we've said before, we do not charge customers a loyalty tax. We proactively reprice customers to reflect improvements to their risk profile, and conversely, will reprice up to reflect any deterioration. Looking forward, we've started to see some more rational pricing anecdotally in the market, and we note that our current pipeline margin is around 25 basis points above our backbook margin. We maintain a disciplined approach to pricing for credit risk, balancing margin, volume, and credit quality, and we continue to see our long-run lending margin assumption in the mid-400s over 1-month BBSW as achievable. Turning now to NIM outlook. FY 2024 will be a transitional funding year for us, with a number of moving parts. Firstly, we expect deposit costs to normalize towards our through-the-cycle assumption. Secondly, warehouse debt will remain a drag on margins due to the full period impact of line fees and additional drawn balances. Thirdly, on a net basis over the full year, lending margins will be only a very slight drag. The full period impact of the weaker margin in FY 2023 will flow through in the early part of FY 2024, but improve in the back half of the year. Fourthly, liquidity is expected to provide a benefit as maturing fixed rate bonds roll over to higher rates, and the overall level of liquids normalizes as we repay the TFF. And finally, we expect equity to provide a benefit from higher rates relative to FY 2023. Looking beyond FY 2024, further normalization of liquid assets, a funding mixed benefit from deposits, and higher lending margins, will help support our NIM assumption of above 3%, together with some uplift from product and channel mix. On costs, we saw CCI reduce by 22 percentage points over the year to 54%, demonstrating improved leverage as the business continues to scale and the strong NIM we delivered this year. The increase in expenses over the year predominantly reflects higher employee costs as we continue to grow, and higher IT expenses driven by software licensing and IT equipment costs. Judo is still in growth mode, and our costs will continue to increase in FY 2024, driven by moderating growth in staff levels and full year run rate impact of recruitment in FY 2023, higher amortization following project investments made in FY 2023, and higher IT expenses from increased licensing, platform maintenance, and enhancement costs. We expect the FY 2024 expense growth rate to materially slow to broadly half the rate of increase experienced in FY 2023. Now to credit quality. While we've seen a tick up in our 90+ days past due in impaired assets, it's been off an ultra-low base, and as Joseph noted, remains well below comparable portfolios of peers. Cost of risk over the second half of AUD 36.3 million came from provision build, and the increase in specific provisioning from additional impaired assets over the half. Provisioning levels remain strong at 121 basis points. In line with the normalization of impaired assets, specific provisions increased by AUD 14.5 million over the half. The collective provision balance increased by AUD 15.5 million to 100 basis points of GLAs, driven by several factors. Firstly, book growth, driving increase in stage one provisioning and stage migration. Secondly, changes to scenario assumptions to reflect a more subdued economic outlook. Thirdly, an increase in the vulnerable sectors overlay to AUD 5 million, reflecting added uncertainty in certain sectors. And finally, partially offsetting those increases, was the removal of a large customer overlay, reflecting our business maturity and diversification. We continue to maintain strong capital ratios, both at CET1 and total capital levels. We ended the full year with a CET1 ratio of 16.7%. While growth was the biggest driver of capital consumption over the half, CET1 was also impacted by higher risk weights and higher deductions, some of which were one-off in nature.... Looking forward, the lower risk weighting from the revised APS 112 standard and organic capital generation from growing profits will help support CET1. In addition, we expect our capital position to be supported by targeted capital initiatives, such as capital relief terms, securitization, and AT1 issuance. We are well progressed with these, including regulatory approvals for an AT1 transaction. A s we show on the right-hand side, we have significant capacity available to introduce AT1 instruments to support our capital stack and continue to support lending growth. Finally, I'd like to close with a couple of key comments. On GLAs, we will continue to grow our loan book within our risk appetite. NIM trajectory will reflect retainment of the TFF and transition to our long-term funding model. FY 2024 is a transitional year for funding, and we remain confident in our above 3% NIM title at scale. Costs will reflect ongoing investment in technology and people as we invest to scale, with the FY 2024 expense growth rate to materially slow to broadly half the rate of increase experienced in FY 2023. Cost of risk will reflect ongoing growth and seasoning of the lending portfolio. CET1 will remain strong, with capacity to continue to optimize our capital structure. Overall, we remain on track to achieve our key business metrics for scale. Thank you, and I'll now pass back to Joseph. Thank you, Andrew, for that A-plus update. I'll now spend some time discussing the operating environment and our exposure to certain sectors. First, to the economy. While high inflation and interest rates have been front of mind for almost 18 months, in terms of consumer spending, we're only just beginning to feel the full effect of households adapting to higher interest rates and other household costs. The transmission of monetary policy into household behavior is not immediate. The literature suggests it can take between 12 and 18 months to flow through, b ut overall, we expect a soft landing. Our expectation is that the impact of higher rates and inflation will not be uniform across the economy, with some sectors impacted more than others. Commercial real estate, accommodation and food services, retail, trade, construction, and manufacturing are the sectors which we see as most at risk. As Andrew explained, we raised an overlay in December in anticipation of some deterioration, and we have maintained that overlay through June. Importantly, however, the SME sector generally remains in good financial health. In stark contrast to households, SME de-gearing has remained low, and we have observed some proactive de-gearing amongst our customer base. Encouragingly, business CapEx has continued to increase. Judo is not a macro play, and we feel confident that our four Cs of credit will enable us to pick strong creditworthy businesses in all sectors as we work through FY 2024. Turning now to credit quality. While Judo, the company, is young, we're not a young management team. As I mentioned earlier, the cumulative commercial banking experience amongst the management and board exceeds 300 years. This experience has been accumulated through several economic cycles across various institutions and markets. Our chairman and three of the senior management team have held chief risk officer roles in other banks. When developing the original thesis for Judo, risk management was foundational. We are very cognizant of the lessons from history. We have looked in detail at domestic and international data from 2001 to 2015, to understand the key reasons for loan losses that reached a total of AUD 4.5 billion. The key lessons were, first, banks did not properly assess the credit risk at origination. There was little evidence of a Four Cs framework, with too much emphasis placed on security. Second, a factor in 45% of losses was borrowers lacking the expertise and experience to manage difficult market conditions. This included borrowers moving into new industries, i.e., outside their areas of expertise. Thirdly, commercial real estate accounted for 40% of all losses, a nd lastly, during periods of increased competition, some lenders gave in to the temptation to loosen underwriting standards. We've seen this in the market over the last 18 months, with some banks looking to aggressively grow their SME books. Our Four Cs approach to credit assesses character first and foremost, the capacity or cash flow second, the capital supporting the debt on the balance sheet, and finally, the collateral security in the event of a weakness in any of the first three Cs. This plays well to the current environment and our ability to back experienced business operators who can successfully navigate through all parts of the cycle. This contrasts to the industry which relies heavily on security as the key determinant of credit risk. Over the next few slides, I'll discuss the sectors which we consider most exposed to the impact of high interest rates. Before reviewing each of these sectors in detail, we have included this comprehensive table of the credit quality and security coverage of all sectors we lend to. There's a lot on this slide, but the three key takeaways are, first, we do not have any material sector concentrations. Second, we are well secured, a nd third, as I mentioned earlier, w hile the number of our customers in 90 days past due and impaired has increased over the past six months, in total, these customers only account for around 1% of our total customer base. This remains well within our acceptable long-term levels. Turning to commercial real estate, we have performed a thorough analysis of our commercial real estate portfolio and note three key differentiators for Judo's portfolio. Firstly, approximately 85% of our borrowers are high net worth and have alternative cash flow sources. Only a small percentage of our commercial real estate lending is to properties where rental income is the sole source of income servicing debt. Secondly, we have very little CBD office exposure. Our office exposure is primarily low LVR, low-rise metro suburban offices, a nd lastly, our largest retail exposures are tenanted by non-discretionary retailers. We have proactively managed down our concentration to commercial real estate, and we remain cautious on this sector as the math suggests that values will decline. However, we will continue to look for transactions on a case-by-case basis and lend to good quality borrowers where the risk to reward economics makes sense. Next, to accommodation, food services, and retail trade. In total, this represents 17% of our book. Within accommodation with food services, our exposures are highly diversified and well secured. Within retail, a large proportion of our borrowers are non-discretionary retailers, including supermarkets, pharmacies, and petrol stations, which on balance, should perform reasonably well, even in a tougher part of the cycle. However, we are maintaining vigilant oversight of this sector, given the susceptibility to consumers tightening their belts. Next to construction. History is littered with examples of banks that have got into difficulty as a result of taking on excessive construction risk. We made a day one policy decision that we had no appetite for pure construction risk. A large proportion of our exposures to the sector is in equipment finance. Beyond this, we have strong real estate security for the rest of our exposures, which is primarily to existing customers. We have no direct exposure to any of the large name construction industry collapses. All in all, we have limited concerns about our construction exposure, given it is highly diversified and well secured by real property assets. On manufacturing, which represents 10% of our portfolio, this is a very broad category with some 83 subsectors. Our portfolio is very well diversified and well secured, with 85% of these loans secured by real property. Our largest exposures are in food and beverage manufacturing, and we have limited exposure to energy-intensive manufacturing. While there has been some easing of supply chain disruption and labor shortages, inflation in raw material and labor costs are ongoing challenges to the sector, which mean we remain very vigilant to the risks in this sector and place additional emphasis on capacity and liquidity, given the potential for shocks to impact these customers. As we look forward, we feel confident about the ability of our specialist model to perform throughout all parts of the economic cycle. We have always seen banking as fundamentally in the business of risk management. Key to our model is the recruitment of experienced business bankers, who are supported by experienced credit executives. We operate on a ratio of 1 credit executive to every 7 bankers, which is industry-leading. Our recruitment is supported by our incentive structure that is based on all ships to shore philosophy, meaning that no individual sales targets, complemented by our major emphasis on equity. Being legacy-free, we're also able to invest more in our frontline capacity, translating to smaller customer portfolios for each banker. This enables bankers to stay closer to their customers and detect issues early. Our business is built on a foundation of experienced bankers who live to serve our SME customers. It is all that we think about and talk about, and it's all we plan for. Before turning to outlook, I want to briefly comment on our culture, which is a key ingredient to our success. In fact, I would say the critical ingredient. It is our x-factor. As the management guru, Peter Drucker, famously said, "Culture eats strategy for breakfast." I would add, "Breakfast, lunch, and dinner." We are very proud to have received several accolades this year that recognize the unique, high-performing culture that we continue to embed. These accolades include the prestigious Financial Times fastest growing company in Australia, and we rated number 4 across Asia. LinkedIn voted us the number 1 company to work for in Australia, and we rated number 4 in the AFR's best place to work for in financial services. We strongly believe that a highly engaged team will produce satisfied customers, which in turn will underpin strong, sustainable financial performance. Our deeply experienced team have significant amounts of skin in the game. With our directors, management, and employees owning 8% of the company. Having an equity culture is a core principle of our business. It underpins a strong ownership mindset, with our people empowered to drive the business forward. On the trajectory to the key business Metrics at Scale, we have a simple strategy to deliver a return on equity above our cost of capital. We have put the building blocks in place, and we now have a clear track record of successful execution. We have made a significant amount of progress in just four years since being granted a banking license. As this slide shows, we have consistently driven improvements in all of our key operating metrics. The inherent benefit of scale are now becoming clear. Our unique specialist business model, which has been designed from a blank piece of paper, will deliver strong returns when we reach scale. T o conclude, our strategy remains unchanged, driven by our vision of building a world-class SME business bank. FY 2023 has been a seminal year for Judo. We have strong momentum as we enter FY 2024, and we'll continue progressing towards our Metrics at Scale. We have a high caliber board and management team, who will continue to work hard to navigate the operating environment and capitalize on opportunities to drive the business forward. We remain a small player in a large addressable market. Remember that our exposures, with an average loan size of AUD 2.3 million, are mostly skewed to medium rather than small-sized businesses. This is important. We believe periods of uncertainty reinforce the value of our relationship-based approach, where our experienced relationship bankers can assess transactions using our Four Cs of Credit framework and exercise judgment. We will continue to grow our lending portfolios, eyes wide open to the risks. As you would expect in this environment, we will also maintain a strong focus on our existing customer base, especially those in vulnerable sectors, to provide support where needed. As Andrew mentioned, we have significant flexibility to manage our funding requirements. We are well capitalized and have a very strong balance sheet. I'd like to finish by saying that there's no precedent for what we've achieved. We are enormously proud of our progress to date, evident in the results that we've announced today. This is a fantastic business with a very exciting future as a unique, pure-play specialist bank, a real Australian success story. Thank you, and now let's open up for questions. 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're using a speakerphone, please pick up the handset to ask your question. Your first question comes from Brendan Sproules from Citi. Please go ahead. Good morning, team. Look, I've just got a couple of questions on your funding mix. Specifically, I'm referring to slide 16. During the last six months, obviously, we've seen quite a bit of deposit competition come into the market. I noticed in your funding mix, I think you grew deposits about AUD 700 million, which was about half, funded about half the loan growth over that period. Now, I just wondered, just the trade-off that you decided to make during the half. I mean, the average TD seemed to cost you about mid-70s, but obviously the warehouse facilities would be a little bit more than that. Could you maybe just tell me about the current trade-off between volume and growth that you've had over the last six months on deposits? I've got a second question. You take that, Andrew? Yeah. Thanks. Thanks, Brendan. I mean, you're right that we had about AUD 700, as we called out, in terms of deposits. Partly that was also because we had quite a big first half, so we did a bit of pre-funding, given the market conditions in the first half. For the second half, we obviously, in balancing the deposits origination, we also had a number of warehouse facilities that we brought on board, and so balancing kind of the first seeding of those facilities. So there's a little bit of that that came through. But overall, I mean, deposits still remain our kind of primary source of funding. A s we look forward to FY 2024, that will be very much the case, despite the environment that we're in, a nd we've had a really good start for the, for the first 2 months this year in terms of the deposit origination. I t is, it is about kind of balancing, the, the funding cost, and also, I guess, some of that, some of that, initial seeding that we need to do of the warehouses. Noting that, you know, a lot of them have had their, their, their first seed, that's come through. It's worth just adding, Andrew, that we've continued to, with our emphasis on duration on deposits and, you know, staying on the 6-9 months and 1 year out of the curve. Yeah. We have seen that, you know, in particular in the direct retail book, that tenor at originations continued to grow. So good tenor in the deposit book as well. My second question is just on slide 17, where you look forward on this deposit mix. Obviously, you want a significant step up in your percentage of deposit funding that you targeted, and obviously reducing the amount of wholesale funding from where you sit today, obviously including the repayment of the TFF. I mean, just sort of back of the envelope calculations, if you grow your loan book at a similar rate as you did last, as you did this year, then you're almost gonna have to have a record level of deposit gathering than what you've done, I guess, since you in your history. Yeah. I mean, you know, the deposit book is growing, and, you know, it will grow in line with, you know, with what we've obviously got in terms of the lending book and then that TFF tail component as well. The. You know, we've had a really strong start to the, you know, for the first two months here, so we're kind of well on our way to what we expect for that landing point for June 2024. We did take the extra warehouse to take us up to AUD 3 billion, and there's a bit of seeding that we obviously will need to do with that. But by and large, you know, deposits still remain the primary source of funding. You know, despite all of the kind of competition and the environment that we hear a lot about, we're just continuing to execute there. We're comfortable with where we've been able to secure pricing. It is a little bit volatile. It has been volatile. We've kind of called that out, but it's still very much within our long-term, through the cycle, 80-90 basis point assumption. I think the other thing to call out is we've just been continuing to invest in the brand for deposits as well, and we're starting to kind of see the benefit of that come through. You know, just building that brand in the market as being a consistent, you know, attractive price offer, in particular in that direct retail market. I t's another big year for us, but you know we've got the building blocks in place to be able to execute on that deposit strategy, and we're very comfortable with the deposit assumptions and the funding mix assumptions that we've got for FY 2024. It's worth adding, and it's important to keep in context that even at scale, we're going to represent less than 1% of the market. We're not chasing a material part of the market. We're priced as a highly price elastic source of funding, so w henever we've needed to access deposits, we've had no difficulty doing so. Mm-hmm. I'll ask, even as I say, when we get to a AUD 20 billion lending book, say, a AUD 15 billion deposit book, that's circa 1% market. And given our pricing position, it's not something we concern ourselves about. Thank you. Thank you. Your next question comes from Josh Freeman from Macquarie. Please go ahead. Hey, guys. Can you hear me? Yep. Morning. Morning, morning. Couple of questions from me. Just I think in the appendix somewhere, just on that hedging slide, you guys mentioned you started an Investment Term of Capital program on the capital balance, which I think now has been pretty much unhedged. Are you guys able to provide a little bit more detail on this capital tracker and what the hedge profile is, when it was initiated, and if it was done as a bullet transaction? I'll come back to you on the second question after you guys answer that. Yeah. Thanks for the question. Ye ah this is probably the last kind of component that we would do to put in place for our hedging strategy. W e've now, you know, post the balance date, we've now kind of started the execution of that strategy. We're kind of actually largely through where we want to be in terms of the hedging. We won't hedge all of the equity bucket, but we'll probably looking to hedge about, you know, three quarters of the equity component, a nd the way that we'll hedge that will be kind of consistent with the way that we've run hedging for the rest of the balance sheet. T he long and short of it is, I think, Josh, is that what you'll see with that, in the appendix slide, if we kind of recut that for pro forma, is that, you know, that would be a pretty, evenly balanced, hedging profile with, you know, the OTC, being put in place. W e're well progressed on that, on that program already. Okay. Thanks for that. I guess I might touch base with you guys later a bit on the duration, but secondarily, you guys have mentioned that competition in SME has started to abate, at least from the lending margin perspective. Should that not eventuate in FY 2024 and competition remains pretty intense, how do you guys view the balance in lending growth versus margin management? Would you prefer to slow down growth to ensure you maintain your margins, or do your at-scale targets predicate a trajectory that drives your scale up pretty quickly? Well, the focus is going to be on, as I've mentioned, Josh, in my remarks, on being very disciplined in making sure that as we grow and we, you know, we've we really, we view FY 2024 as a continuation of FY 2023, that as we grow, we'll, we won't compromise on margin, nor on risk. Now, and I'm going to pass to Chris in a second, but what we have seen an easing in some of the pricing in the market, as you know, the benefits of TFF start to leave the market in terms of funding, cost of funding, and NIM pressures that the banks are facing in other parts of their portfolio. S ome of the aggressive pricing that we saw as a feature of late FY 22 and FY 23, that is starting to ease off. Chris, anything you'd add to that? No, Hi, Josh. I think just as we answered on deposits, I just think you have to put these into context. We're 2% of the market. Again, we are not a macro play. You know, we have the ability to find the deals, as Joseph said earlier, where we're not compromising on credit quality, we're not compromising on volume, and we're not compromising on margin. We know where we play, we know how we win, and that's the strategy that we'll just continue to execute. But, there's definitely, we're seeing activity dial back. As you know, I mean, two big banks were going sort of pretty much head to head, and they were using risk appetite and price at the same time. We are definitely seeing more rational pricing for risk now. Where they are still using the price lever to win deals is very much more in that truly commoditized lending, particularly at the lower end. As Joseph said in his presentation, we're very much an M bank not an S bank where they are still very, very aggressively competing on prices in the, say, Low Doc, but we don't play there. You know, we're not a macro play. We know where we play, we know where we win with 2% of the market. Yeah. It's what, I mean, it's an important point, Chris, and Andrew did highlight this in his remarks. There's a service proposition. As a pure play specialist bank, providing high quality of personal touch, high touch service, and this has been true of all of my experience in SME. SMEs who get a high quality service proposition are not price sensitive. You've got to be pricing reasonable, but we've found over time that we can price up to a 50 basis points premium for a similar risk because of that service proposition, and that's always been part of the whole CVP that we've had in the market from day one. And, as Chris mentioned, we tend to avoid competing in highly commoditized, price-sensitive transactions where Judo brings nothing to the table. E ven last year, we've been maintaining that 50 basis points premium. At no point have we compromised on that. Yeah. Andrew did mention in his remarks that our pipeline has a 25 basis points improvement versus the current bank. That pipeline's AUD 1 billion. Yeah. I t's not a small pipeline. Yeah. W e don't want to get involved in the price game. We don't need to, you know, as a truly unique specialist bank with highly experienced bankers, customers will pay for that service. Mm-hmm. The challenge for us is to maintain a high touch service proposition. Thank you. Thank you. Your next question comes from Richard Wiles, from Morgan Stanley. Please go ahead. Good morning. I have a couple of questions. The first one, Joseph, on margins. Slide 20 is a bit confusing, I think. You say that in FY 2024 will be a transitional year for funding, and then there'll be progress to the at scale NIM of more than 3% beyond 2024. Does that mean you expect the margin to be less than 3% in 2024, but then go back above that level in FY 2025? Well, we see, we, as Andrew mentioned, it is a transitional year for us as we come off the TFF, a nd as we're looking, and as we signaled, we do see that there'll be a fade factor on our current NIM. What is difficult to do is forecast. W e can kind of get line of sight for the first six months of FY 2024. It's difficult to try and forecast beyond that, because we really don't know what's going to happen in the deposit market in particular. It's been. It has been a highly competitive market in recent times, but we're not anticipating that that will necessarily continue to be the case, given margin pressures across the system. W hat we're seeing is that there will be a fade factor on the current NIM, but we do expect that we'll be able to rebuild that NIM and maintain our goal of plus above 3%, above 3% when we get to Metrics at Scale, as we work towards Metrics at Scale. Andrew, is there anything you would add to that? No, I mean, I think that's a good summary, Richard. There's obviously a lot of moving pieces and, and I think there's less visibility on how that will play out necessarily in the second half. But, you know, the at scale, we're very confident in, you know, the building blocks are in place there. T he potential, I think, you know, in terms of, the, just the continued progress as we build through the transition off the TFF towards that, those at scale, you know, funding mix stack is very much there. W e've well progressed on that, you know, this year, in particular with the deposit. You know, we've had a really good start to the year in terms of the last two months of deposit progress, s o that's kind of well underway. Okay. Thank you. T hen my second question relates to loan losses and, in particular, commercial real estate, s o you note that your NPLs are well below the industry average at the moment. Joseph, you also say on slide 28, that history tells us that commercial real estate accounts for 40% of all loan losses. Given that sector is 22% of your portfolio, but something like 7%-8% at the major banks, shouldn't we expect your NPL ratio, and therefore, your cost of risk, to end up well above the industry average as we go through a cycle? Yeah. Well, our commercial real estate book, as a percentage of our portfolio, is actually just below the industry average for an equivalent book, s o it's in the single digits when you add the whole balance sheet. W hen I look at our commercial real estate percentage of book, we are, you know, I think where I've been before, and I've seen other figures in the 22%-24%, s o we're, as a percentage of SME, we are where the market is. I mentioned on slide 30, that there are some key differentiators, if I can use that term, of the Judo portfolio. The first big being that 85% of our commercial real estate lending is to high net worth, and where there is a second or at least an alternative source of income to service the debt. We only have a very small percentage of our commercial real estate lending that is reliant on rental income from the property to service the debt. I think that's an important characteristic of our business, a nd secondly, we have very little CBD office exposure. I feel that the mix of the commercial real estate book, which we have been managing down as a percentage of the portfolio because we have been cautious on the sector, I think that's well managed, well diversified, and is performing well. Frank, is there anything you would add to that? No, I think that's a perfect summary, a nd probably just to reemphasize the fact that we have proactively managed our commercial real estate exposure from, you know, 18 months to 2 years ago when we anticipated the changing in the monetary policy cycle, and that this would occur. W e pivoted our strategy to focus more on the investment portfolios of SME customers, and that's a really important feature of the resilience of our current book. Yeah. I mean, Richard, just going back to—and thanks for mentioning slide 28, because, you know, we—as we were thinking about Judo's risk appetite, we did study carefully credit losses in this sector, not just domestically, but in other Anglo-Saxon economies. And we also looked at the mistakes that you know fast-growing banks had made and how they were prosecuting their strategy. Those lessons, combined with the deep experience of the management team, you know, have been very much influential in the way that we're running the bank and thinking about risk appetite and thinking about portfolio growth. I kind of tie it back to another comment that is really important, and that is that the management in the company, and I, and I include the directors, and I include a lot of the staff, are major, you know, equity owners of the company. We have and so we are running and thinking about risk as an owner of the organization and making sure that the risk appetite is not gonna be compromised in the sense of seeking asset growth, but on weak risk fundamentals, because that's simply totally misaligned with the, the philosophy and the, the ownership mindset that is very much part of how we think, talk, and act. Probably the other thing that is relevant, from a portfolio composition viewpoint, and it, and it's also mentioned throughout the presentation, is that the CRE compositions elsewhere typically are comprised of a heavy development concentration, which we have virtually no exposure to. And this is the area of the CRE portfolios that have historically borne a lot of the losses. Good, good point. Thank you. Thank you. Your next question comes from Jonathan Mott, from Barrenjoey. Please go ahead. Thank you. I've got a question that kind of follows up from Richard's question on that slide 20. Just trying to get my mind around the NIM pressure that you're looking, a nd I know 2024 is a transition year, and it's you've committed to it at scale, but it does look like there's gonna be a lot of pressure coming through next year. I just wanted to see if we're in the right ballpark with these numbers, b ut potentially, credit growth next year, sort of around that AUD 2.5 billion-AUD 3 billion, implies somewhere around 25% growth, give or take, how the economy plays out. T hen the margin coming down quite sharply. I know there's liquidity moves, there's movements as well, but you'd be expecting that the net interest income would only be growing somewhere around 10%. You've flagged expense growth half the rate it was this year, s o if you put those numbers together, you're looking at a pretty flat year next year for pre-provision profit. Now, I know they're ballpark numbers, but are we missing anything in that sort of back of the envelope for FY 2024? T hen I've got a follow-up question, too. Yeah, no, it's a good question, Jonathan. I mean, it's-- you're right. There's a lot of moving pieces as we work through this year, and, you know, a lot of that is gonna be driven by this roll-off of the TFF and the continued progress, you know, in terms of the funding transition. I think, you know, we've certainly, in terms of kind of how we look at the certainty, I guess, of FY 2024, you know, the first half, we've got more certainty on because it's obviously, it's closer, and we can kind of see some of the trends, in particular, around the deposit costs and the competition that we see there. We've got a sense of how that will play out, you know, we're two months in, obviously. We're similarly on, I think, the lending margin dynamics and, you know, Chris and the team, we spoke a little bit about that earlier. F rom a kind of a first half NIM perspective, you know, we will obviously see a reduction from the highs of the print that we did for June, and that will. We've always said that will come back as it rolls off. Harder to be as definitive, I think, for the second half, because, you know, there are a number of levers and how the competition around deposits and the wash through of lending margins comes through is further away from us. Y ou're right. I mean, we are going to see, you know, some of the growth in terms of income moderate a little bit as we go through this transition. And, you know, costs, yes, costs will continue to grow, albeit, you know, we're seeing a real flattening of that growth rate, and that's something that we will obviously be working to keep, you know, a disciplined handle on. I mean, it's worth just adding as a footnote, Andrew, that the way that we think about the company and the way we're managing the company is through FY 24. I mean, we've got. Back in November 2021, we put metrics at scale. For us, those metrics at scale are a contract with the market. We're managing the company to deliver on those metrics at scale. We remain absolutely confident and committed to them. We'll manage the transition of FY 24 as is, but the journey to meeting those metrics to scale which include a NIM above 3%, we are absolutely committed to and I'm confident of achieving. So I know there's always a temptation to focus on the next six months and the next twelve months. We will perform well in a transition year and in a difficult economy, but we will not lose sight of our primary objective is to deliver on the promises we made to the market in terms of achieving the metrics we scale. That's how we think, that's how we plan inside the company, and that's how we assess our performance. Thank you. If I can have a second question, just around the deterioration in the 90-days past due that you've seen. But if you look at the total number of accounts which have gone into arrears and non-performing, you're looking around 41 accounts. I know there's, what? 3,800 accounts, it's quite huge, but it's a sharp rise. You've got a very young book, and usually, it takes, you know, 2-3 years for many loans to season. So I wanted to get a feel for how many of the loans that have now gone into arrears were recently originated. And where I'm getting to is, have you seen many accounts where, you know, you have lent someone money, and very quickly, they've gone into arrears, and this has been an adverse selection that has come through? Frank, do you want to do that? Sure. The direct answer to that question is none. None of the accounts that we've originated in the last twelve months form part of that cohort, and- Last 18 months. Last 18 months. Yeah. The almost entirety of it, I think, barring one account, is more than two years old. So your initial comments that the book takes a little while to season are absolutely spot on. But it also provides a validation point for the quality of our, you know, origination assessment and underpins the value of the judgment-based approach that we apply at origination. Okay. Well, if you follow that on, you're saying that 1% of your book's non-performing, and that's really good, but should we then be dividing that by not your book size today, but your book size two years ago, to look at, well, on maturity? You know, your book's grown a lot in the last two years. Of the loans that you had on your book, 18 months to two years ago, what percentage of those accounts have now, as I said, gone into non-performing? Is that a better way of benchmarking your asset quality? Yeah. I mean, one way to do it, John, would be to look at what that 90 days plus and impaired, if we effectively looked at that level over, you know, call it the loan book a year ago. And that 1.99% would be in the order of kind of 1.75%, by way of a kind of a, I guess, a crude vintage style analysis. So obviously higher because of the growth. But I think then when you look at some of the other benchmarking that we provided earlier in the pack around kind of, well, how does that compare against the sector? It's, you know, we've done some analysis to try and pick apart, to make it as app- apples to apples as we can. You know, the sector's currently about kind of 2-2%, so it's a bit crude, but it gives you a sense that, you know, that, that 90 days in impaired, while it's obviously kind of come up a bit, there's some vintage in there, is still kind of within the level that we, we're quite comfortable with. And, you know, the other way to look at it is, well, what's been the P&L experience and cost of risk over the last, you know, 12 months? And, you know, we said over, well, pretty much a year ago, that we expected that would be in the order of AUD 50 million-AUD 60 million. Well, we've kind of printed pretty much in the middle of that range, AUD 50 million-AUD 55 million, for the FY 2023. So yes, there's been a normalization in 90 days and impairments, but it's been off an ultra low base. And you know, and the level of provisioning that we hold on the balance sheet, you know, we just continue to build that. And that's you know, a very solid number as we face year ahead. Yeah. Well, I think that point is very important. That point, the, the provisioning point is very important. We're well provided in terms of our, you know, because we're always looking at our leading and lagging indicators on credit quality, and the provisioning sitting at 121 points. Yeah. Yeah, we're strongly provided well. Thank you. Thank you. Your next question comes from Andrew Triggs, from JP Morgan. Please go ahead. Thank you. Good morning. Our first question, just around the timing impact from the replacement of the TFF. That chart on slide 20 shows that it's a 2024 impact with the NIM then rising from that trough level in 2024. But the TFF repayment is back-ended weighted to second half of 2024, based on Judo's profile. So why is there not a sort of residual impact at the start of 2025? Why is it all sort of concentrated into 2024? Yeah, I mean, thanks for the question, Andrew. I mean, in terms of, yeah, what we show on that page, you're right, it's, we've just shown the impact I guess through, you know, through the FY 2024 year, a nd it isn't completely uniform. I mean, we do, in terms of the... If we think about, I guess, the roll-through of that TFF repayment over the, you know, over the year, over FY 2024. But there will be an element of that kind of coming through in, certainly as we think about it, kind of first half, second half, it'll be a little bit more drag that we see in the second half. T he other thing that I think, and this is why there's a lot of moving pieces here, I appreciate that with getting your head around the modeling, is that we'll also be continuing to evolve the funding stack at the same time. So the build of deposits, which is also, I guess, ultimately kind of an offset to how that normalization will wash through. So, you know, I think, you know, we've called it out, that there will be some normalization of that NIM over FY 2024. But, you know, that also due to the TFF roll-off, but that's also kind of coming through as we're building up that deposit mix. As I mentioned earlier, we've made really good progress on certainly the FY24 target, in the first two months of this year. Thanks, Andrew. Second question, just around the TD cost chart that you showed up to the end of June. Could you comment post that you made a couple comments in your remarks, but post-June, in July, it looked like carded TD rates were up a lot but have come back in August. Can you make some comments on the last couple of months? I think you said that you're still confident of that 80-90 basis point spread, but just what you're seeing in the last- Yeah little while, please. Yeah, no, we are confident in that 80-90 basis point guidance that we've put through. I mean, the option for TD pricing, unfortunately, isn't flat. It does move around a little bit, and we kind of call that out, I guess, on that page 18. It's partly driven by pricing. It's also driven by, I guess, movements in the swap rate as well during that period. In terms of what we've seen in … If I think about kind of the first, call it, 2 months of this year, we did see that go up again quite a bit. Actually, in July, we probably saw it come above the 80-90 range, and that's why we talk about that as, I guess, being an average. But, you know, as we look at August, that's actually kind of come back and come back within the range. Mm-hmm. It's, you know, it's at the top of that range, but it's come back within that range, s o it moves around, but we're kind of very-- we're very comfortable with that 80-90. You know, we're 1%, at best, of the TD system. We are nimble in terms of how we look at, you know, where we take the funding, our funding needs from. We can be opportunistic as we, as we called out in the first half. We actually got ahead of our, ahead of our funding, TD funding, in the first half of this year. And then we, we just play across-- You know, we've got all of the tenors. We're present in all of those tenors, in particular, the longer tenors, and channels as well. We've got really good flexibility there with, you know, with the launch of direct SMSF, which is performing really well for us, and direct business as well. You know, we are pretty active with how we look at this part of the marke, a nd then supporting all of that is the investments that we're making just in terms of building the Judo brand. You know, I think we're starting to see some really steady build benefits of being known as a consistent, consistently good, you know, deposit offeror in terms of pricing. We're really building that reputation, and that consistency means that when we want flow we can price up for it. D o we necessarily have to always be at the top of the rate tables? I think that's the benefit of the investment that we're doing in and proposition, a nd so we're very confident in the 80-90 range. We're managing to that. I think we've demonstrated we can manage to that. With the massive amount of disruption that we saw in the, in the, you know, in the last six months, we've still, despite all of that, managed within that range, and you know, we anticipate that we will be able to going forward. This is also, you know, at some point we expect that there'll be some normalization of activity and competition. Certainly, when you look at what the majors and others are having to pay in the market, we expect that some of that heat will come out. When that happens, you know, probably not going to put a date on it, but, you know, I think that's- that will be part of the ultimate wash through of the TFF that we'll see this year. Thank you. Thank you. Your next question comes from Azib Khan, from E&P. Please go ahead. Thank you very much. A couple of questions from me, one on loan growth, one on capital. On loan balance, the loan balance of AUD 8.9 billion at end FY 2023 fell a little shy of your target of greater than AUD 9 billion. I note that you're not providing loan balance guidance for end FY 2024. Is the irrational loan pricing prevailing in the market that you've alluded to, making loan growth more challenging and the outlook less visible, or is it some other factor? I mean, the loan growth, we would've sailed past AUD 9 billion at 30 June, other than some delays in settlements with other banks. It's always a problem at the end of June when you go to some of our competitors asking for settlement figures and they take their time getting back to you. So we had the pipeline, and we actually went through the 9 billion within 10 days, I think, of you know, getting into July. I said earlier that FY 2024 is going to be a continuation of FY 2023, and that we're running our own race. We are. There has been a more subdued market, I would say, simply because of the economy. You're not going to expect businesses to necessarily all businesses to be borrowing, given an uncertain economic outlook. So there has been a slowdown in the market activity. But we've also always said that we're not a macro player here, and we have a strategic hedge that we don't rely on system growth per se. I mean, we, 75, Chris, correct me here, 75-80% of all our lending is done as a result of refinancing from a major bank, and that's largely because of service that the customer can't get a hold of a banker or it's taking too long to respond. We, we're confident on our assumptions around growth, regardless of the economic environment. Hence the, hence the emphasis on a strategic hedge that we have talked about in the past. We are running our own race. We have no appetite in FY 2024 to grow much faster than we're grow-- than we have grown. We've said, we've been really clear on that, actually, a nd again, I repeat, we are managing this company to the medium-term metrics at scale, and we've been growing it at about net AUD 3 billion per annum. An assumption around AUD 2.5 billion-AUD 3 billion would be a fair assumption. O f course, we're not. We're going to be very cautious in the, depending on where the economy, what happens in the economy, because there's, you know, reasonable prospect, because we are, we're assuming a soft landing. It's not going to be an even soft landing. There'll be soft pockets in the economy, and we're going to have to be quite careful about our credit assessment, particularly since we, as we mentioned in our remarks, that, in the transmission of monetary policy, we're only really at the beginning of that, impacting households and businesses. There's another 12 months at least to run, and so we've really got to be quite prudent in our assessment of risk in certain sectors of the economy in particular. N otwithstanding that, we're feeling confident about our achieving, you know, a continuation of what we've done in FY 2023. Chris, anything you'd add to that? No, no. I mean, just what I said earlier, Azeb, which is we've got a AUD 1 billion pipeline. We've always said the gestation period of an SME from lead to settlement is about 90 days. And that AUD 1 billion of pipeline is at 25 basis points higher than the margin you saw in the second half of last year. So as Joseph said, we're playing our own game. We're not a macro play, and we're very confident about the future. Yeah. And also, Chris, I mean, our history says that 90% of that pipeline- Obviously. -converts. It converts, yeah. Yeah. It's what we call our Triple A. Yes. So it's not a... It's a pipeline, not a pipe dream. Second question for me on capital, please. The CET1 ratio declined over the half despite the benefit from the revised capital framework. And it looks like organic capital generation in FY 2024 will be challenged as a result of the NIM contracting to being sub 3%. If the cost of risk remains within your expectations, can you commit to achieving the at-scale metrics without needing to raise ordinary equity capital? Yeah, no, very, very much so, Azeb. I mean, the-- I think what you've seen in the last kind of six months here is it's been a little bit of lumpiness. We obviously had a very big period of growth, as we always do, leading into the you know, into June. It was-- I mean, we had, we did almost 600 gross originations in June, the month alone, which was a superb effort and demonstrates the momentum. But that causes a little bit of lumpiness, obviously, in terms of the capital consumption, when you look at it, you know, maybe quarter on quarter by quarter, which maybe some of you have been doing. The other thing here is that we had a couple of kind of one-off. We had some deductions, et cetera, and some of them were kind of one-off in nature, you know, some of the debt fees, et cetera, which again caused a little bit of lumpiness, offsetting some of the capital generation, organic capital generation. So, you know, I think that's. There's been a little bit of movements there that makes the trend a little bit harder to see when you look at it just in isolation. But, you know, we're very confident in the ability to get to, you know, to get to the at scale book and the at scale economics. I think the other thing, you know, to highlight on top of, I guess, the capital print that you see for June is that, you know, as has always been part of our capital plan through this at scale period, is a number of another capital initiatives that we have, that will supplement the capital stack that you see today on slide 24. And they include, for example, you know, term relief, self-sec, as well as, you know, as well as kind of a, you know, an AT1 transaction. And we're very well progressed with those initiatives, and we've got, you know, some other initiatives that we're also looking at. T hat they will kind of supplement the capital stack as well, as we go on, you know, through to the second half of the at scale trajectory. Thank you. Thank you. Your next question comes from Josh Freeman from Macquarie. Please go ahead. Josh, are you there? Hey, guys, can you hear me? Yeah, we can hear you. Yeah, good day. Perfect. Sorry. Thanks for the opportunity to ask another couple of questions. I just want to dial in. You know, a couple of people have sort of focused on the first half, second half margin, and you guys have been pretty strong that, you know, you're pretty confident on first half margins. If you guys are confident, having had sort of two months of deposit data, lending margin data, you know, why aren't you guys willing to be sort of drawn on providing guidance for first half margins? I'll come to the second question additionally, after. Look, I think, Josh, you know, we're I think, you know, we've been obviously pretty good at giving the market guidance in the past, and that's just, I think, reflective of certainly kind of where we've been. The reality is that, you know, there are obviously a number of moving pieces as we've kind of talked through, that make it difficult for us to be as definitive and give you an actual number. T hat's just, I think, reflective of, you know, there's just a lot of moving pieces, in particular around NIM, s o where we can, we've been pretty good, I think, in terms of the direction of the movements. I t's just a more challenging environment for us to be as specific to give you a specific number. Yeah, well, yeah, I would say, Josh, that we are giving guidance with our metrics to scale. We're saying that and we've been very consistent on this, that you've got to look at this comp- this bank on the basis that we will be an AUD 15 billion-AUD 20 billion lending book. We're about halfway, past halfway, actually, almost AUD 18 billion. AUD 9 billion, sorry, that we'll deliver our cost to income ratio in the low 30s, that we'll deliver a net interest margin above 3, that will deliver cost of risk within 50 points. So that I mean, that's as strong a piece of guidance as you're going to get. A s I've mentioned earlier, we're managing the company to that end because we view that as a contract with markets, promises we've made, and promises that our credibility would be called into question if we didn't keep. And that's very strong guidance. Understood. Thanks. And I guess follow up to that is, you know, would it be fair, given how margins are tracking or reasonable, to assume NII will be broadly in line then with second half 2023? No, I like it. The expectation should be that it will be higher. You know, we'll still be growing, Josh. I think that's important. You know, despite kind of the environment we're facing, we're still a growth company. You know, we're still, you know, we've seen really good momentum in the originations that we've done. I mentioned the figure that we saw in June, you know, that's continued through. So, you know, the growth is as an important part, I guess, of thinking through the profile there. Thank you. Thank you. There are no further questions at this time. I'll now head back for closing remarks. Okay. Thank you. And thanks, everybody, for your participation in the session and the questions, which we much appreciate. We hope that you found the information that we've provided to be in line with our what we've done in the past in terms of the quality of our disclosures. As Andrew mentioned at the beginning, we've included quite a bit on our credit book, certainly as it relates to the sectors that are of more interest, of most interest to the market. You know, we feel that this is a really strong set of results in a challenging environment in terms of FY 2024, and a transition environment in terms of funding, the funding mix. W e feel really confident about maintaining our momentum towards achieving those metrics to scale, and we'll manage the bank to that in the end, and then start with a new horizon beyond those metrics to scale. I'm absolutely thrilled with the performance of the company, and the consistency. We met every guidance we set 12 months ago, we met plus, and we're reconfirming our commitment to the metrics to scale, and that remains something that we are very confident of. So thanks again for your participation in this call, and, I'll. I think we can bring it to a conclusion now.