Ladies and gentlemen, welcome to this ageas conference call. I am pleased to present Mr. Hans De Cuyper, Chief Executive Officer, and Mr. Christophe Boizard, Chief Financial Officer. For the first part of this call, let me remind you that all participants will remain on a listen-only mode, and afterwards, there will be a question and answer session. Please also note that this conference is being recorded. I would like to hand the call over to Mr. Hans De Cuyper and Mr. Christophe Boizard. Gentlemen, please go ahead. Good morning, ladies and gentlemen. Thank you all for dialing into this conference call and for being with us for the presentation of the six-month results of ageas. I'm joined in the room by my colleagues of the executive committee, Christophe Boizard, CFO, Emmanuel Van Grimbergen, CRO, Antonio Cano, Managing Director for Europe, and Filip Coremans, Managing Director for Asia. This quarter, our businesses continue to enjoy a strong commercial and operational performance in both Europe and Asia. In Europe, the impact of the COVID-19 pandemic is gradually fading. We are still recording lower revenues on real estate, mostly from our parking business, and experiencing lower claims frequency in motor, but to a much lesser extent than in previous quarters. Moreover, the pandemic had a neutral impact on our results in Q2 with a lower frequency in non-life positive compensated for the remaining negative impact on investments in life. Overall, the sound operating performance of the consolidated entities in the first half of the year is reflected in the life operating margins and the non-life combined ratio, all standing within target range. In Asia, the net result was driven by a solid underlying performance, mitigated by the impact of the unfavorable evolution of the discount rate curve in China and by negative net realized capital gains recorded on the quarter. On the commercial front, we enjoyed a solid sales momentum in Europe and Asia, with inflows up 11%, driven by both life and non-life. Life inflows benefited from the strong start of the year campaign in China and from excellent unit-linked sales in Europe. Whereas non-life inflows were up, thanks to a strong performance in Belgium and continental Europe, and to the new contribution of Taiping Re in Asia. On a sudden note, I would like to mention an event which took place after the closing of the second quarter. As you know, heavy rainfall during the first weeks of July caused floods in a large part of Belgium with devastating consequences. Our teams have been fully mobilized to provide help and support to the victims. Given the size of the damages suffered, and in order to indemnify the victims as quickly as possible, we have joined the sector to propose an additional effort above our legal requirements. Our current assessment, taking into account this proposal, leads us to expect a negative impact on our net third-quarter result of around EUR 55 million. This is after tax and after reinsurance. Despite these exceptional weather events and despite the impact of the further decrease in Chinese yields, we are confident in our ability to deliver a full- year net result, excluding the impact of RPNI, in line with our initial guidance of between EUR 850 million and EUR 950 million. Moving now to our cash and solvency positions. Our cash positions remained at EUR 1.2 billion, which gives us a great financial flexibility. Since the beginning of the year, we have already received EUR 670 million dividends from our operating companies, which is a record amount for us, and we confirm expecting above EUR 700 million for the full- year. These dividends more than covered the holding cost and the EUR 485 million dividend paid to ageas shareholders in June. Additionally, as announced, we have finalized the acquisition of the Turkish Life company, AvivaSA, which has since been rebranded AgeSA. I would like to take this opportunity to mention that AgeSA, which has been consolidated into our accounts since May 5th, recorded solid results in Q2 and already contributed EUR 4 million to our results. Still on the M&A front, the sale of Tesco Underwriting in the UK is now completed. We received the first payment of EUR 45 million in the second quarter, and we expect a second payment of around EUR 95 million in Q3. Lastly, our solvency amounts to 196%, up with 1%, significantly above our target of 175%. Given our strong cash and solvency positions, we have announced this morning a new share buyback of EUR 150 million. Now, ladies and gentlemen, I will hand over to Christophe for details on the results. Thank you, Hans, and good morning, ladies and gentlemen. As you can see on slide five, our six months group result amounted to EUR 407 million, including EUR 115 million negative result from the general account, driven by EUR 57 million negative revaluation of the RPNI. As mentioned by Hans, our operational performance has been solid in both life and non-life, and as usual, I will now give you more details by segment. Let's start with Belgium on slide six. In non-life, the combined ratio year to date, which amounted to 93.8%, was still supported by lower claims frequency in motor, which compensated for some adverse weather not related to the floods of July. The remaining COVID impact in non-life was fully offset in Q2 by the continued lower revenues from real estate in life. It is, however, worth noting that these revenues are gradually recovering as restrictions related to COVID are being eased. The guaranteed operating margin amounted to 81 basis points in the first half of the year, slightly below the target range. In Q2, this margin was impacted by some scattered impairment on the equity portfolio, even if at the end of the quarter, the amount of unrealized capital gain on the equity book reached a record amount of EUR 1.2 billion, compared to EUR 0.8 billion at the end of last year and EUR 1 billion at the end of Q1. There is a progressive positive trend on the unrealized capital gain on the equity book. The guaranteed operating margin should recover later in the year with the realization of real estate capital gains expected in the second half of the year. The unit linked operating margin reached 37 basis points, so in the upper end of the target range. Moreover, the commercial performance has resumed robust progression after the weaker level of last year induced by the COVID-19. This year, life inflows are strongly up, driven by high unit linked sales. On non-life, an exceptional growth of 7% was recorded with progress in all business lines. In the U.K., slide seven, motor claims frequency were back to pre-COVID levels in the second quarter. There, lower frequency no longer compensated for the continued increase in claim inflation. Prudent reserving, along with increased levy cost, weighed on the combined ratio of the quarter. Meanwhile, the strong net result benefited from a higher corporate tax rate, which induced positive revaluation of the deferred tax assets. On the commercial front, inflows have proven resilient in the COVID context and remain stable scope on scope when excluding the past contribution from Tesco Underwriting. In Continental Europe, slide eight, the performance was satisfactory in both life and non-life. In non-life, the combined ratio year to date stood at an excellent 87.0% in Portugal, with motor claims frequency normalizing to pre-COVID level in Q2. The contribution from Aksigorta in Turkey to the result, while still positive, suffered from adverse claim experience. In life, the guaranteed operating margin year to date amounted to a high 113 basis points, thanks to a sound underwriting performance, while the unit linked margin pursued its steady improvement and stood at 32 basis points within the group target range. As previously mentioned by Hans, the newly acquired Turkish company, now renamed ageas, contribute for two months to the life results. The commercial performance delivered by the segment was excellent in both life and non-life. In life, inflows showed a strong recovery driven by unit linked sales. In non-life, inflow increased by 17% at constant exchange rate over six months, with growth in all the product lines. In Asia, I am on slide nine now. The life segment continued to deliver a solid operational performance. In Q2, the underlying performance was broadly in line with the excellent performance of last year. However, after a very strong Q1, the net results suffered from the adverse evolution of the discount rate in China and from negative net realized capital gains due to our own IFRS restatements. It is worth remembering that the dividends we receive from Asia are based on local accounts, so before our own restatements. In non-life, the result increased thanks to the contribution from Taiping Reinsurance. The continued growth in inflow at 100% in both life and non-life also benefited from the contribution from Taiping Re for EUR 618 million in life and EUR 727 million in non-life. You can see slide 15 where you have all the details, segment by segment, entities by entities on the inflows. The reinsurance segment, now on slide 10, benefited in the first quarter from the lower claim frequency recorded at the level of the ceding entities, whereas the second quarter reflected normalizing claim frequency and adverse weather in Belgium, already mentioned. As already announced by Hans, our group solvency to ratio, slide 12, increased to 196%, driven by a strong operational performance, which more than covered the accrual of the expected dividend. Our operational free capital generation, so slide 13 now, amounted to EUR 375 million, including EUR 163 million in dividends from our non-controlled participation. On the negative side, influencing the free capital generation we had in Belgium, the progressive migration to assets bringing increased SCR. That's what we call the, quote-unquote, "rerisking of the balance sheet" to support the margins. In the U.K., we had a somewhat weaker own fund generation in Q2 due to the prudent reserving and the change of scope following the sale of Tesco. Additionally, we increased the interest cost generated by the new debt instrument issued at the holding level over the past year. All this weighed on the operational free capital generation, but nevertheless, on the other hand, at group level, the operational free capital generation is satisfactory given the increasing amounts of dividend received from Asia. All the segment have been reviewed. This is the end of my presentation. Thank you. We will now go through the question and answer session. Ladies and gentlemen, this concludes the introduction. We now open the question and answer session. May I ask you to limit yourself to two questions. If you wish to ask a question, you have to press 01 on your telephone keypad, zero and one on your telephone keypad. We have a first question from David Barma from Exane BNP Paribas. Please go ahead. Thank you and good morning. My first question is on the non-life business in Europe, and the statements you make on that, cat nat. Can you remind us how the excess of loss program works at the group level and in Belgium particularly, and how the government support mechanisms work in Belgium, and how that fits with the EUR 55 million impact that you mentioned this morning? Secondly, on non-life as well, could you give us an update on your key markets for motor insurance on competitive dynamics? Maybe if I can add a small last one on the life investment income. You mentioned still a drag from your real estate investment rental income in the second quarter. What was the impact this quarter versus your, say, run rate budget for that? Thank you. Okay. Thank you, David. Let me take the first question on the impact of the floods. Well, I cannot in detail zoom in on how the reinsurance program works for AG and ageas. That's, of course, company confidential information. Traditionally, you reinsure yourself for one single event, and we also reinsure ourselves on an annual basis for these type of incidents. Now, how does the mechanism works. Before 2005, actually all cat nat claims came automatically on the cat nat fund, which was run by the government. There was no intervention by the insurance industry. In 2005, the cat nat law came into force where the insurance industry would take a first layer of claims, and that layer is automatically adjusted for the size of the market. Today that stands for the industry around EUR 350 million. Above that, we do as traditional, go back to that cat nat fund owned by the government. From 2005 till this year, actually, all cat nat events have been taken by the insurance industry within that first layer. it's now the first time, and of course quite excessively, that we will go above that first layer, and therefore there are some discussions going on at this moment with the government how part of this cost could additionally be shared between the government as well as the insurance industry. Due to the confidentiality of those negotiations, I cannot go into the details of the current proposal made by the industry. I think we are more or less in the final days to come to a formal agreement. What we have done is we have, in the EUR 55 million, taken into account already the current proposal, which is on the table coming from the insurance industry. That brings us to EUR 55 million. The overall claims cost for AG looking forward today is expected to be around EUR 400 million. That makes the total event definitely an event above EUR 1 billion claims cost for the market. The EUR 55 million is net after tax, after reinsurance, and for the 75% owned by ageas in AG. That's what I can tell you about the floods. On the motor dynamics in the European market. Sorry, yeah. No, thank you for that. Sorry, just one thing. My understanding was you had an excessive loss treaty for cumulative events. Is that still in force? Because I would have thought that the July plus the H1 weather events would have triggered that. Well, we have that stop loss, yes, in place. Of course, these type of incidents will go way above the retention of that stop loss. That being said, of course, it is also not automatic that any additional intervention you would do that automatically fall into your reinsurance cover. That you should also take into account when you assess that EUR 55 million impact. I cannot give you, at this moment, more details how the impact is split between the basic regulation and the excess. At this moment, I cannot give you more light on this due to the confidentiality of the discussions. Thank you. For motor, I pass it to for the European markets. Yes. Hello, good morning. On motor, I guess you were referring to the main markets, so Belgium, U.K., Portugal. Belgium on motor, you see, as was said by Hans and Christophe's introduction, we see frequency creeping up to pre-COVID levels. I would say in Belgium we're not there entirely, but very close. Just anecdotal evidence. Recently, there was a report from the Flemish Road Safety Institute, and they indicated that claims frequency on the Flemish roads was actually to levels of 2016. That it's picking up as the lockdown measures are relaxed. For us, not really a lot more to mention on the competitive dynamics of the Belgian market. It remains competitive, but not more competitive than in the past. It's a stable market. U.K., also there we see claims frequency creeping up, slightly different nature. Less claims frequency related to, say, the daily commuting as many companies are still in semi-lockdown, but you see a higher frequency in the weekends, et cetera. Overall, frequency is creeping up. On the pricing dynamics, you've seen in the first part of the year a drop of average premiums. I think for Q2 compared to Q1, we were minus 1.5% in the market. We see that stabilizing. Just for completeness, in Q1, the drop was more significant. I think it was more in the order of minus 6%. In Portugal, a bit the same story. Frequency creeping up again, but a fairly stable market in terms of pricing dynamics. Okay. Life investment income. Christophe, you will take it? Yeah. Okay. Two things on the investment income. First on new money and then on the existing book. On new money yield, we achieve a very remarkable performance because in Q2, new money yield reached 2.05%. This is done through, obviously not with govies. We have riskier assets, but we reach the 205%. By the way, the reason why, if you look at the evolution of the SCR coming from HE, it is going slightly up, and it is a consequence of what I mentioned in my speech, the de-risking of the balance sheet. All in all remaining, obviously, within our risk appetite, of course. We reach with 205% on new money. On the existing book, we have a drag on real estate. On real estate, two things. First, the retail and then Interparking. Broadly, we have on Interparking a loss around EUR 10 million, but we observe a good trend in the occupancy of the car parks. Once we are close to 70%-75% now, so what is left, what is really behind is the airports, but on the rest, we are recovering rather quickly. On the retail, what weight on the result is the fact that we have reduced some rents. This is for another EUR 9 million. EUR 10 million on Interparking and EUR 9 million for the retail, EUR 19 million in total. Recovering. Yeah. Recovering on Interparking. Yeah, it's done in total. Yeah. If I can make a comparison, year to date on the Interparking, we see still compared to pre-COVID levels, compared to 2019, a drop around 30%-35%. We do see, for instance, in July, that that is already reduced to -10%. We do expect for the second half of the year, a recovery. We have actually some countries already where the parking revenues are above the pre-COVID levels. As Christophe said, the main impact that remains are the airports, and the airports is the biggest impact on the Belgian parking business. We are actually quite confident that we can go back to pre-COVID levels and even growth because the parking park is still also growing gradually, so that we can go back to pre-COVID levels very, very soon. it was in second quarter last year, all real estate and equity impact was EUR -44, and this year, second quarter, it is EUR -19, so we are actually less than half on what it was the year before. Thank you very much. Million. It's close, yeah. Yeah. Thank you. Sorry. Thank you. Next question from Ashik Musaddi from JP Morgan. Please go ahead. Yeah. Thank you. Good morning, Hans. Good morning, Christophe. Just a couple of questions, if I may. First of all, if I think about your earnings guidance, you had increased it from 850-950 and then 900-950, and now again, going back to 850-950. How do we think about that change in the guidance again? Are we more or less thinking that the earnings would be between 850-900, or what are the moving parts here? Because on one hand, I agree that these losses from the Belgium floods are high, EUR 55 million, no doubt about it. At the same time, European equity markets have been strong, so there could easily be some offset from capital gains that you can book in Europe. How are you thinking about this guidance is the first question. Second thing is, clearly, macro in Asia, especially China, has been volatile with equity markets as well as interest rates coming down. Any fresh thoughts on how do we see the underlying earnings of Asia? In past, you have done a great job in giving us the building blocks of the earnings. Any thoughts on those updated numbers would be very helpful. Lastly is, you have announced a share buyback of EUR 150 million. How do we think about the capital position here, and is there any relevant M&A in the pipeline that you would flag or not at this point? Thank you. Okay, Ashik, let me take the first one on the guidance. You know very well, and you're right. We have set in the beginning of the year the guidance EUR 850-950, with a very strong performance in the first quarters, mainly also coming from the capital gains and some continued positive impact of COVID. We have raised it to EUR 900-950. Since I think we have now for the second quarter to take into account two important elements going forward. First of all is the EUR 51 million coming from the floods. The second one, as you remember, in previous guidance, we have assumed a negative impact from the variable interest rate in China for the first two quarters, and that that would more or less stabilize in the second half of the year. We see now that interest rates are still going down. Well, have been going down in China, stabilizing a bit now. we do expect some additional negative VIR impact, and Philippe, in your second question can zoom into this, for China. those are the two main attention points. You're also right that we have a very solid unrealized capital gain position, both on the equity book as well as on the property book. that's why we are also not lowering the upper limit. we take into account the potential on the lower side, but we do not lower the upper limit because that will depend on financial markets, equity markets, and the potential of capital gains. let's not forget that this year, the capital gains season on the real estate transaction is almost fully in the second half of the year. This is still to come. I cannot give you detailed numbers on this. That is also something we should take into account. That's the motivation to go for 850-950. Where will we end in the range? Honestly, it's hard to say. I keep it open for the full range for the time being with the arguments I just gave you. On the Asia earnings, I will pass to Philippe for some details. Yes. Thank you, Hans. Let me start with saying that underlying, there is absolutely no change in the outlook and indicators that we see on Asia. I know, of course, that many of you were surprised by the relatively low results on the surface for Q2, certainly after a strong Q1. Happy to comment on that. If we look at the underlying first and foremost year to date, we had an overall result of EUR 203, and in fact, the underlying result is not all that different because the net, the capital gains realized to date was EUR 65 million. The valuation interest rate up to half year was EUR 74 million. Underlying, that leads to a EUR 212 million. If we do the same exercise specifically for Q3, we had the valuation interest rate impact in Q3 of EUR 34 million and a negative capital gain impact of EUR 36. underlying, we had even a very strong 125 for Q2 on its own. To put that further into perspective, and Christophe and Hans commented on it, these negative capital gains, very important to note what they are not. They are not realized losses, and they are not impairments. They are IFRS de-recognitions of local capital gains. The result in China, in their accounting rule, they put their property in fair value to P&L, and they have a substantive trading book, of which also the gains run through the P&L. Under IFRS, we de-recognize both. However, what we do not do, and that is quite conservative if you ask me, is take the profit-sharing compensating effect into account. we do still carry the full charge of the profit-sharing dotations that Taiping Life makes in these funds. I'm more inclined to look at the underlying trend, which is more in line with what you can expect in the local results, which in the end drive dividend expectations forward. What is then our outlook, as you ask, Ashik, by end of year? The interest rate in China undeniably came down further and took a dip in July, even touching 2.8, now rebounded a bit to close to 2.9. Based on that, our best estimates, and of course with the caveat of high volatility in this indicator, they range between EUR 170 million-EUR 180 million impact of valuation interest rate by end of year. on the result outlook related to that, we stick to our 350 to 400 range, but I am inclined to say that given the fact that in the local accounts, they realized already quite a bit more capital gains than we did, that we may not end under IFRS close to the 400, but rather to the 350. That's very clear. Okay, we'll find. Thank you. Thanks a lot. That's very clear. Okay. Thanks, Philippe. Ashik, your last question on the share buyback. Well, three comments I want to give there. First of all is, of course, I cannot disclose anything on M&A, but what we call our test position to look at potential M&A is actually not impacted really by this share buyback because you have heard me saying during the introduction that we expect more than EUR 700 million of upstreaming this year, take into account the EUR 485 million coming from the dividend. We still have ample room to do this share buyback. Secondly, I think we have always said that our guidance this year is the Connect 21 program, and we want to honor our commitment there and where we have said if no significant M&A announced, that we would do a share buyback of EUR 150 million. That's also, I think, the second reason why we do the share buyback. Last but not least, also our solvency position has been very resilient throughout the whole COVID crisis into this year, into the second quarter. We're also very confident from a solvency point of view. One final comment I'm going to give because that question might come later on anyhow. Within the European directive, we had a limitation of EUR 130 million. Once again, same as the dividend last year, we have announced a share buyback in a very open and constructive dialogue within the National Bank. You know that the European directive will end 30th of September, so there was no objection to go EUR 20 million above that maximum limitation that we have. We have been able to honor our Connect '21 commitments. That's very clear. Thanks a lot for this detailed answer. Thank you. Thank you. Next question from Benoît Pétrarque from Kepler Cheuvreux. Please go ahead. Yes. Good morning, all. A couple of questions on my side. I would like to come back on the July event in Belgium, which is extremely severe and shocking as well. I was wondering what have been the lessons learned from your side from this event. We're talking a lot about climate change. I was wondering if you are currently happy with your reinsurance program, the way you structure it, or you are potentially thinking about a small reset or adjustment of this program. That will be the first question, just the more long-term or medium-term impact of this July event from a strategic point of view. The second one, just to come back on the normalizing frequency in non-life in Belgium, it was still a small positive in Q2. What do you see so far in the third quarter? Do you expect more normalization? We've been talking about also frequency potentially shooting up a bit during the normalization phase, and I was wondering if you still think that will be the case. Just finally on re-risking. You've been doing re-risking in the second quarter, and where are you now? How much further re-risking are you expecting? Thank you. Okay, let me take your very first part of the first question, lessons learned. I think it's too early. We are still dealing with the recent events. Of course, we can all read that frequency and impact of these events is on the rise. I can imagine that after the agreement with the government, there will be a follow-up how the cat nat regulation might be further improved, which I think is also very important for the insurers, because that way they are able to align their reinsurance programs with the regulation, and that we can operate within a very clear legal framework, and that the insurers can protect and organize themselves for this. What about our current reinsurance program? I'll pass it to Antonio. Thank you, Hans. the reinsurance programs get adapted every year, but the principal philosophy remains the same. Basically, we insure slightly above the one in 200 events, and these models continue to be adapted. referring specific to climate change, it is nothing new for the reinsurance world. the models have been gradually adapting. Maybe there will be more adaptations, but don't expect because of this specific event, like a drastic change in the reinsurance cover. as Hans was saying, should the legal framework be adapted, then that obviously will be reflected in the reinsurance fees. There's no additional lockdown coming up. Don't see any reason why that should stop. we are gradually normalizing, definitely in Belgium, definitely in the Flemish part of Belgium. Okay, on your first question for segments, we are subject to this re-risking thing. It is mainly Belgium, but to a lesser extent, continental Europe. I will take Belgium as a very good illustrative example. First, let me give you the asset allocation in Belgium, and you will understand where we are heading to. Real estate, we are slightly above 10%, loans close to 20%, equity close to 4%, and then the bonds, that's the rest. The re-risking, it is on real estate, and on real estate, it is safe to assume that we are close to a maximum when you compare with the SAA, the strategic asset allocation, which is the reference. We are close to a maximum, so I don't expect a lot of additional SCR coming from the real estate. On equities, the trend will continue. Why? we will take advantage of this famous long-term equity. As you know, they have a more favorable solvency treatment. On equity, the goal is to increase by roughly one point. On all the fixed income bond and loans, we still have migration from sovereign debt To more advanced instruments like loans, infrastructure, direct lending, or things like this. There, the movement will continue. Conclusion, on equity, we can expect more SCR, more allocation on equity, and then the reshuffling of the fixed income portfolio with more note and instrument bearing additional SCR. Conclusion, and I cannot give you precise figures, but the trend will continue for a while. Yeah. Thank you very much for that. Thank you. Next question from Michael Huttner from Berenberg. Please go ahead. Fantastic. Thank you very much. My main question is really to understand the operating capital generation. I know you don't focus so much on that, but you did publish it. EUR 212 million, the guidance for the year was EUR 500-540 million, which is well below. It looks from what you're saying on the SCR that the second half will not be higher. Here my question is, how does that impact the cash generation that you would expect from your cooperation as a consolidated unit? The second thing is on. I feel a disconnect, and I'm really sorry, but I feel it really strongly. You're investing more in these real assets, but you're not actually giving us more gain to reduce the guidance. I'm kind of thinking, well, I'm not a shareholder, I'm just an analyst, so what do I know? I'd be a little bit disappointed. Then finally, if I may, so China's cash is delivering a bigger payout that you kind of assume, so 35% versus 30. How sustainable is that? Thank you. I take the question. On the free capital generation, you are right, indeed. We are below the guidance of EUR 130 million a quarter. In my speech, I gave you some explanation. Let me remind you the main one. First, some de-risking in AG and the quote-unquote cost of this de-risking is quite sizable. The increase in SCR for AG is EUR 29 million. 29 million additional SCR times the 1.75 of the objective, you have a very sizable effect on the operational free capital generation. If you only restated by this amount, you would be back within the guidance. There are additional things, like the fact that you left the scope. It accounts for EUR 5 million. We have more financing costs. The financing costs now reach EUR 30 million, which is again, a sizable amount, decreasing the own fund generation of the general account. Some adverse things. as I said, then compensated by a nice increase in the dividend coming from China. I know that this has to be deducted when we compare with the guidance. in the near future, we will upgrade the presentation of the free capital generation, and we will be able to rely more on the free capital generation coming from Asia. it is in the future. you will see that the free capital generation coming from Asia is really strong. your second point was, how come with investing more in real estate, we don't generate more return? We do. when we invest more in equity and more in real estate, we have more own fund generation. I cannot give you the exact breakdown, but indeed, there is more over time. When we invest into this riskier asset, you have a kind of one-off upfront cost with the increase of SCR. For the future, you have on a recurrent basis, more generation of own funds. This is included. on the Asian- You asked an additional question, which you asked on the sustainability of the payout ratio in China, which is indeed very important. We saw indeed that our payout ratio on a local result basis moved from 30 now to 35. Given the also excellent result last year in China led to record high dividend submission out of the region. We're now at EUR 152, I believe, more or less, and that is going up with the dividends still coming in from Malaysia, I believe. We will be close to EUR 170 net dividend contribution. Your question on the sustainability of the 35% is indeed very relevant. First and foremost, that all depends on the capital consumption for the growth and the capital generation. As Christophe said, operational free capital generation is of the essence. Now, remember that last time we said that over last year, and it was also in the footnotes of the free capital generation, the previous presentation, that Asia region overall had an operational free capital generation around EUR 400 million. if you look at the dividend outflow, it's still just 35, seems very much sustainable. It also depends on the solvency evolution of the operating entities, and as you can see that they're fairly stable. Of course, China Taiping still has to release its results, so cannot say too much, but don't expect too many surprises there. Of course, they paid this dividend, which in the first half, always a little downward pressure, but overall solvency ratio seems to be stable with this payout ratio. the only other thing that remains to be noted is the upcoming C-ROSS. probably you read in the press that there was an article appearing in Asia Insurance Review, I believe, a few days ago, saying that they expect that the impact for the sector to be around 10%. Now, given the fact that the solvency ratio of Taiping is over 200, that is not worrying. At the same time, China Taiping also announced, or at least Taiping Life announced the issuance of subordinated debt, in execution which will add another 14% to their solvency ratio. All in all, we expect stable solvency conditions and sustainability of payout ratios 30%-35% moving. Philippe, what we can add on the sustainability of the dividend of China is that at the CTIH level, at the Taiping group level, there is a need to collect dividends. because it's a key component of the group, that's the largest entity. Taiping Life it's a little bit like AG for ageas for them. Correct. I understand. That's very helpful. Thank you. Thank you. We have a new question once again from Ashik Musaddi from JP Morgan. Please go ahead. Yeah, thank you, and sorry, Philippe. Sorry to come back again on Asia. You kindly gave the whole moving part of Asia for this year. I just wondering, how do we think about the interest rate impact for next year? This year you mentioned it's 170, 180. Should we expect any improvement in that number for next year on a marginal differential basis, yeah. Not like what would be the actual number, but like differential-wise, would this number go down next year, or would this number, would you say go up next year based on what we know about the interest rates as of now? Thank you. Ashik, I particularly appreciate the last part of your sentences, what we know right now, because this is obviously moving. Yeah every time, and it's quite volatile. yes, of course, you can actually project it if you look at the 175 rate averaging forward. It will taper off in the end, towards the current rate and that gap is diminishing because the current VIR is around 3.08. the new rates are around of 2.9, so that band is narrowing down, so this effect will taper off. Initially, we even hoped that in 2022 we would have almost no impact, but given this recent dip in rates, some impact will be there. Okay. That's it. Thank you. Let me put another caveat to it, and that is for everybody. The volatility does not only come from the rate. There are two other components, and you keep that in mind that it is not a science. It depends on the curve. It's not a single point. Also the movement in the curve may have an impact from month to month, from quarter- to- quarter on the effect. The other thing is the size of the balance sheet, because we still continue to grow quite strongly. If you saw the assets under management increased with 11%. Also on new business, that impact is there from quarter -to- quarter movement. Keep that in mind that the volatility of these figures are high. Thank you. Thank you. Next question from Fulin Liang from Morgan Stanley. Please go ahead. Hi. Good morning. I've got just 2 questions. The 1st one is, I saw that the inflow of Asia is growing, which is good. If I look at the APE in the 2nd quarter of this year, by my calculation, the APE has actually down about 18%. Is there anything we should be concerned or is there any special reason that the APE in the 2nd quarter is down compared to the 2nd quarter of last year? That's the 1st question. The 2nd one is, I'm sorry, I don't actually fully understand that capital loss explanation in Asia. Can I ask a question from a different angle? Is actually the property market value, and the equity investment market value actually going up in 2nd quarter or is actually going down? Thank you. Let me first talk a little bit indeed about the new business. You rightfully noticed that APE. First let me start with year to date. APE is up I think around 12, 13% year- on -year. There is a nice growth for the first six months. Indeed it was more in the first quarter and quite a bit less in the second quarter. There are two caveats to that. First and foremost, last year in the first quarter, of course, we had more COVID-19 impact, and there was a catch-up clearly there in the second quarter into SIRMS volumes, whereas this year the first quarter started extremely strongly. Secondly, there has been more focus on IR than B products. Less focus maybe on top line, and specifically in China, less focus on IR tickets in the bancassurance channel, but more on value-adding tickets in bancassurance channel, which helps back APE. We will, and we will publish these tables later, as you know with some delay still. VNB, in the region, for an APE up of 12%, will be up more than 40%. The exact figure, I leave it mostly to our colleagues at Taiping to disclose. The value of the new business written is significantly better than the APE growth even. It's also a shift of focus on more value-adding products, maybe less on the top line in the second quarter. The second question was about that capital loss. Clearly, there is no losses. It's the recognition, as I said. Market value recognized on property went up, in the local account and the mark to market on their trading book went up, in their local accounts. To make your life, let's say, easier, it will be interesting for you to follow the result announcement of China Taiping, which unfortunately, as you know, comes in one or two weeks from now, and that will give you a better insight in the difference between the local result and the IFRS result that we recognize, and hence also in the magnitude of the adjustment we had to make. Actually, in summary, it's the capital gains that runs over the P&L in CTIH but not in the IFRS accounting of ageas. It's not losses, it is capital gains. From a valuation point of view, it's actually good news, because value is improving. In 1 sentence. The revaluation of real estate, it is fair value to P&L. This increased result is eligible for increasing the profit sharing at a rate of 70%. What we do is, since our own IFRS option is to do amortize cost on real estate, we restate and we cancel this revaluation of real estate, but we don't restate the profit-sharing increase. That's the reason why we say it is very, very prudent, as Philippe said. Okay. Thank you. Thank you. As there are no further questions, I would like to return the conference back to the speakers. Ladies and gentlemen, thank you for your questions. To end this call, let me summarize the main conclusions. First of all, we delivered a very solid operational performance in Europe and in Asia. I want to note that the inflows were strongly up, both in life and in non-life. Despite the expected impact of the recent floods in Belgium and the interest rates evolution in China, we are confident in our ability to deliver a full-year result in line with our initial guidance of EUR 850 million-EUR 950 million. Given our strong cash and solvency position, we have announced a new share buyback of EUR 150 million. With this, I would like to bring this call to an end. Do not hesitate to contact our IR team should you have any outstanding questions. Thank you for your time. I would like to wish you a very nice day. Thank you, ladies and gentlemen. This concludes today's conference call. Thank you all for attending. You may now disconnect your line.