Ladies and gentlemen, thank you for standing by. I am Yiota I acovou, call operator. Welcome, and thank you for joining the Bank of Cyprus conference call to present and discuss the first quarter 2024 financial results conference call. All participants will be in a listen-only mode, and the conference is being recorded. The presentation will be followed by a question-and-answer session. Should anyone need assistance during the conference call, you may signal an operator by pressing star and zero on your telephone. At this time, I would like to turn the conference over to Mr. Panicos Nicolaou, Chief Executive Officer. Mr. Nicolaou, you may now proceed. Good morning, everyone. Thank you for joining our financial results conference call for the quarter ended thirty-first of March, twenty twenty-four. I am joined by Eliza Livadiotou, Executive Director of Finance, and Annita Pavlou, Manager, IR and ESG. After my introductory remarks, Eliza will go into more detail on our financial performance, and then we will be happy to take your questions, both during this conference call and afterwards. I would like to start by briefly reminding you of our powerful equity story and our core strengths on slide number 4. We are the leading financial group across banking and other financial services in Cyprus, which is a highly liquid and concentrated banking sector, and we operate in a supportive macroeconomic environment. The Cypriot economy remains strong, delivering good growth, proving once again its flexible and resilient characteristics. We are one of the most liquid banks in Europe and hence enjoying the benefits of continued high interest rates. At the same time, we have been undertaking proactive action to position ourselves against a more normalized rate environment in the years to come. We have strong levers under our control, our diversified business model, our ongoing focus on cost control, our robust asset quality, and our strong capital position. All support us for continuing to deliver shareholder value, supported by a sustainable mid-teen ROATE over the medium term and attractive shareholder distribution. Turning now to slide number 5. Our particularly strong performance in 2023 enabled us to obtain approval from the ECB in March 2024 to significantly increase the shareholder distribution from full year 2023 earnings to EUR 137 million, comprising a proposed cash dividend of EUR 112 million, EUR 0.25 per ordinary share, and an inaugural share buyback of up to EUR 25 million. This proposed cash dividend is five times higher than that paid in 2023 and is equivalent to distribution yield of 8% based on share price as at 8th of May, 2024. We have more than doubled the payout ratio to 30% compared to last year, meeting the target payout range of 30%-50% specified in our distribution policy one year after it was established. Slide number 6 shows an overview of the macroeconomic environment. Against the backdrop of geopolitical uncertainty, the Cypriot economy continues to display strength and resilience. Based on the latest projections of the Ministry of Finance, economic growth is expected to be around 2.9% in 2024, outperforming Eurozone average. Tourist activity continued to improve, with arrivals for the first quarter 5% higher compared to the corresponding period in 2023. The unemployment rate decreased to 6% in the fourth quarter of 2023 and is expected to drop further to 5.8% for 2024. As in many other countries, consumer inflation continued to be impacted by energy prices, but has now come under control. In Cyprus, inflation stood at 2.2% in April 2024, and is expected to average around 2.5% in 2024. Slide 7 demonstrates the group's continued strong financial performance for the first quarter of 2024. Net interest income for the first quarter remains strong on the back of high rates and ample liquidity, declining only modestly after reaching its peak in the fourth quarter of 2023. Our continuous focus on cost management kept the cost income ratio low to 29%. As a result, we delivered yet another quarter of ROATE over 20% and an organic capital generation of almost 113 basis points, feeding through into strong growth in our tangible book value. Let's now provide more details for the first quarter highlights with slide number 8. During the first quarter of 2024, we recorded a profit after tax of EUR 133 million, corresponding to an earnings per share of 0.30 EUR, underpinned by strong revenues, cost containment, and good asset quality trends. Our liquidity profile remains robust, post the repayment of EUR 1.7 billion of TLTRO. Around 30% of our assets are cash balances, with central banks benefiting from high rates, while our deposit base remain broadly stable. In April 2024, we successfully issued EUR 300 million MREL eligible green senior preferred notes, thereby finalizing our MREL requirements and including a comfortable buffer. This issuance was the first ever green bond issue for Bank of Cyprus, representing an important step to lead the transition of Cyprus to sustainable future. On asset quality, our NP ratio reduced to 3.4%, and our coverage improved to 77% for the quarter. Moving now to capital metrics. Our regulatory CET1 ratio and total capital ratio, as at 31st of March 2024, stood at 17.1% and 22% respectively, which, as a reminder, exclude the current period profits, including current profitability, net of distribution accrual at the top end of our distribution policy. Our CET1 ratio and total capital ratio increases to 17.6% and 22.5% respectively. You can see on slide 9 how our quarterly performance is tracking against the 2024 guidance we set back in February 2024. It is clear that on all metrics, we are running ahead of our 2024 targets. In summary, net interest income was supported by higher than expected interest rates and positive deposit trends, both on mix of deposit and pass-through, and our cost of risk was low, reflecting strong underlying performance, but was held by some large one-off reversals in the first quarter. We intend to review our financial targets alongside our first half financial results. Longer term, we remain committed to generating and maintaining return on normalized rates. I will now hand over to Eliza to take you through our Q1 earnings in more detail. Thank you, Panicos, and good morning from me, too. Slide 10 shows the detailed income statement of the group. I will not go through every line, since I will be discussing the drivers of our profitability in the following slides. Let's start with the main drivers of NII on slide 12. Our net interest income for Q1 stood at EUR 213 million, corresponding to a net interest margin adjusted for TLTRO of 3.9%, down 10 basis points on the prior quarter. This modest reduction Q-on-Q is mainly due to a small decrease in EURIBOR rates, hedging activity, as well as marginally higher cost of deposits. Overall, our net interest income is declining less than anticipated, reflecting a more favorable interest rate outlook, and at the same time, our deposit trends are behaving better than expected and pass-through remains resiliently low. Let me now remind you of some of the key drivers of NII as I look forward to the rest of this year. On the positive side, the favorable interest rate outlook, expansion in fixed income portfolio, as well as modest loan growth, will all benefit NII. On the other hand, hedging has a cost, as we forego some NII in order to reduce sensitivity. Additionally, the ECB MRO rate spread is expected to decrease by 35 basis points from September 2024. And finally, the recent issuance of EUR 300 million senior preferred notes in April will result in an annual interest rate expense of EUR 15 million per annum. On slide 13, I want to give some more details on some of these factors and the assumptions and sensitivities behind our net interest income expectations. The top table provides a summary of the forward curves we used in February in guiding to our NII target of over EUR 670 million for 2024, and how they have evolved since. We know that the recent developments in rates have been more positive than we had expected. Clearly, we are still at the beginning of the year, and we will not mark to market our guidance with the changes in forward curves. However, it's clear that solely based on a delayed interest rate normalization, there is upside to the 2024 guidance. Using current forward curves, we have indicated that approximately EUR 40 million higher NII might be expected based on the interest rate trends we are seeing. But as Panicos mentioned, we intend to review our guidance with half one financial results. Let's now turn to slide 14 to provide you an update of our hedging strategy. In Q1, we continued with our hedging activity and carried out an additional EUR 2.1 billion worth of hedging. We are on track to meet our 2024 target of EUR 4 billion-EUR 5 billion. A large element was through hedging of non-rate sensitive deposits through received fixed interest rate swap, while we continued our investment in fixed rate bonds as well as the use of reverse repos. These actions had a small cost on the Q1 NII. We believe that the hedging we carry out today will support future revenues, and most importantly, will result in lower rate sensitivity. Simultaneously, about a quarter of the group's loan portfolio is linked with the bank's base rate, which provides a natural hedge against the cost of deposits. Overall, these actions have led to a reduction in NII sensitivity to 100 basis points parallel shift in rate by EUR 20 million compared to the prior quarter. On slide 15, you can see that deposits remained flat on the prior quarter, but increased by 2% year-on-year to EUR 19.3 billion. We're encouraged that the shift in deposit mix towards time and notice deposits is progressing more slowly than we expected. In Q1, it was around 33% of the total. And if you look at the breakdown of our EUR 19.3 billion deposit base, you can see on the bottom left chart that almost 80% of our deposits are from Cypriot residents. Additionally, deposit pass-through levels were well managed, facilitated by the very liquid Cypriot banking sector. This is evidenced by the evolution of our cost of deposits, which remained low at 29 basis points, corresponding to a pass-through of 22% on time and notice deposits in Q1, up from 18% on the prior quarter.... expect the cost of term deposits to continue to increase further as deposit balances reprice to the higher standbook rates. As a reminder, we assume an average pass-through around 40% in 2024, and the sensitivity to each 10 basis points change in the cost of deposits results to a change in NII by around EUR 20 million. While the percentage point change in the deposit mix towards term impacts NII by EUR 1.5 million. Moving to slide 17 on new lending, the group extended EUR 676 million of new loans in the first quarter, which is usually a strong quarter, representing an increase of 46% on the prior quarter, while maintaining strict lending criteria. As a result, the gross performing loan book grew by 2% Q on Q to EUR 10 billion, driven by new lending exceeding repayments, and also benefiting from the acquisition of a small portfolio of performing and restructured loans with gross book value of EUR 58 million. This transaction was completed in March 2024. Now, turning to the fixed income portfolio on slide 18. As at 31 March, the portfolio amounted to EUR 3.7 billion, up by 36% on the prior year, representing 15% of total assets net of TLTRO. The majority of the portfolio is measured at amortized cost and is held to maturity. Hence, no fair value gains or losses are recognized in the group's income statement or equity. The mark-to-market impact of the amortized cost portfolio amounted to a fair value loss of EUR 14 million as of 31st March, representing an increase in bond yields. Slide 19 provides a summary of non-interest income. On this slide, I'd like to highlight that non-NII remains an important driver to the group's profitability, covering almost 80% of total operating expenses for Q1, albeit a reduction in the prior quarter and year. Fee and commission income reduced by 10% on the prior quarter, reflecting lower transactional and non-transactional fees. The net insurance result was also down by 37% on the prior quarter, as Q4 has benefited from the improved experience variance in the life business. I'd also like to remind you that FX gains are volatile profit contributors. Moving now to slide 25, which provides an overview of operating expenses. Our cost to income ratio of 29% in Q1 was supported by strong revenues and disciplined cost management. Total operating expenses were reduced by 14% on the prior quarter, reflecting mainly quarterly seasonality. On a yearly basis, total operating expenses were broadly flat. Staff costs were slightly up, both on a quarterly and yearly basis, reflecting mainly inflation, salary increments and higher employer contributions. Now, turning to cost of risk on slide 26. The cost of risk for Q1 at 27 basis points was significantly lower than both the prior quarter and the prior year, indicative of the robust performance of our loan portfolio and the stable economic environment. During the quarter, we had a one-off reversal on stage one and stage two loans, driven by enhanced IFRS 9 modeling, which facilitated the removal of conservative management overlay. At the same time, the stage three charge was the result of one-off modeling enhancements and charges on a small part of the NPE legacy portfolio. Additionally, we incurred impairments of EUR 8 million in Q1 relating to the REMU properties due to the aging of the stock. Provisions for pending litigation claims and other matters amounted to EUR 10 million in Q1, which mainly relate to the progress of cases and the one-off provision charge on tax-related matters. Let's now move to slide 28 and capital. The bank's capital position remains robust. Our regulatory CET1 and total capital ratios stood at 17.1% and 22.0%, respectively. When including quarterly profitability and post the distribution accrual at the top end of our distribution policy, our CET1 and total capital ratios improved further to 17.6% and 22.5%, respectively. Let me remind you that this level of distribution accrual does not constitute an approval by the regulators for a dividend, nor a decision by the bank with respect to such distribution for 2024. Turning now to slide 29, which discusses our recent capital market issuance. In April, we successfully issued our inaugural green senior preferred bond of EUR 300 million. This one was made with strong demand, attracting interest from more than 120 institutional investors, and was more than 4x oversubscribed, enabling us to price it 50 basis points tighter than the initial pricing indication. This bond completes our MREL built up, allowing us to achieve our MREL requirements with a comfortable buffer well ahead of our end 2024 deadline. This was Bank of Cyprus's first ever green bond, and it's an important step in our plan to lead the transition of Cyprus to a sustainable future. Now, moving to slide 30 on asset quality. The NPE ratios stood at 3.4% at quarter end or 0.8% on a net basis, in line with our 2024 targets. Our NPE coverage improved to 77%. When including tangible collateral, NPEs are fully covered. Slide 31 on real estate. As you can see, the real estate management unit, repossessed stock has decreased by overall EUR 26 million on the prior quarter, to EUR 836 million as of 31 March. With balance sheet de-risking completed, the inflows are expected to remain at extremely low levels, and our focus will be on delivering sales. We remain on track to achieve our 2025 target of reducing the REMU stock to around EUR 500 million, and we will continue to sell on average, close to independently assessed open market value and above book value. I would now like to hand back to Panicos for his closing remarks. Thank you, Eliza. Moving to slide 32. Our particularly strong performance in 2023 enabled us to obtain approval from the ECB in the first quarter to significantly increase the shareholder distribution from full year 2023 earnings. We have more than doubled the payout ratio to 30% compared to last year. That corresponds to distribution yield of 8%, based on a share price as at 8th of May, 2024. For the first time, in the first quarter, we launched a share buyback program of up to EUR 25 million. The strong financial performance continued in the first quarter of 2024. We delivered a profit after tax of EUR 133 million, equivalent to a ROTE of 23.6%. This is the fifth consecutive quarter we record a ROTE over 20%. It is clear that our performance in the first quarter of the year is tracking ahead of 2024 targets. We intend to review our financial targets alongside our first half financial results. Longer term, we remain committed to generating a mid-teens ROTE on normalized rates. This concludes our presentation, and we'll now open the floor for your questions. Ladies and gentlemen, at this time, we will begin the question and answer session. Anyone who wishes to ask a question may press star, followed by one on their telephone. If you wish to remove yourself from the question queue, then you may press star and two. Please use your handset when asking your question for better quality. Anyone who has a question may press star and one at this time. One moment for the first question, please. The first question comes from the line of Alexandros Boulougouris with Euroxx Securities. Please go ahead. Good morning. Many thanks for the presentation. Two questions on my end, if possible. First, regarding the NII and hedging on the EUR 90 million sensitivity that you mentioned in March, EUR 20 million reduction compared to December. Is this based on all the hedging you have done up to Q1 with the additional hedging that you mentioned? And is there any additional hedging you plan or you're already in this EUR 4-5 billion target that you mentioned, you're already there, let's say, on the hedging levels? That's my first question. The second is on cost of risk at 27 basis points. There's a target of 40-50 basis points, and you mentioned that you're trending towards 40-50, but you're already below. Was there something specific in Q1 that led to a cost of risk well below this target, or? That's my second question. Thank you. Okay, thank you, Alexandros. Starting from the cost of risk, I would say that 27 basis points, it's indicative of the robust quality of our trade portfolio, and it's important to say that we do not see any areas of material concern, especially having in mind that the Cypriot economy is performing extremely well. We have yesterday the actual Q1 GDP growth, and it was 3.3%. It was best performing in the Eurozone, so we are very happy about that. Having said that, the 27 basis points versus the 14 basis points, it's only... It's a small amount. We are talking about small numbers. It's only an additional EUR 3 million provision charge. The 40-15 basis points is our medium-term guidance and has an element of conservatism built in. Given geopolitics and the small numbers, we don't consider appropriate to changes in this guidance for this time being. Generally, we don't re-guide this quarter. So we'll of course consider our assumptions and outlook when we will do a more general guidance, but I want to emphasize again that the extremely good performance of our portfolio quality and the robust performance of the Cypriot economy. On hedging, Eliza? On hedging, the EUR 90 million sensitivity to 100 basis points, parallel shifts, Alex, is the sensitivity as of 31 March, so it's using the March balance sheet. On slide 14, we've deliberately set out how much hedging we've actually done in Q1, so that you can, I'm sure, model the future. So there's EUR 2.1 billion of hedging done in Q1 to reduce the sensitivity out of the EUR 4 billion-EUR 5 billion annual target. So we've done just over a third, and we also increased the fixed income portfolio by just shy of EUR 0.5 billion in the quarter. So there's more hedging to be done during the year. We're trying to phase it out and average the the impact out as well. So the ninety is only where we got up to Q1. There's more to come. ... Okay, so then to be clear, you've done EUR 2.1 million out of the EUR 4.5 billion for the target, and the EUR 90 million will be reduced further going forward as scheduling increases gradually? Yes, exactly. The target is to reduce this EUR 90 million by another EUR 20 million by the end of the year through the incremental hedging and actions that we will do, which are broader. It's not just hedging, it's the whole balance sheet evolution that drives this, obviously. A fixed income, I mean, portfolio loans, everything. Got it. Very clear. Thank you. The next question comes from the line of Hugo Cruz with KBW. Please go ahead. Hi, thank you. I have a couple of questions. One, again, on NII. You know, your pass-through assumption, I know you didn't change the guidance, so, but you have a pass-through assumption of 40%. I think that probably implies a time and notice deposit cost of around 1.2% by year-end, but I think you just reported 87 basis points. Is that correct? And so can you tell us what are the latest front book rates you're offering? Because the 87 is back book. And is it fair to assume that once the ECB starts cutting rates, you will offer lower rates than what you're offering now? So that's my first question. My second question was around staff costs. I mean, should we look at Q1 now as broadly the run rate for the rest of the year, or is still a bit more to come, you know, to reflect the inflation? Thank you. Thank you for the question. Starting from the staff cost, I think it's hard to say that Q1 results reflect, let's say, on the rest of the year. And on the general level of deposits, yes, we have to admit that and recognize that we continue to guide conservatively on depositors' behavior, meaning that the actual is better than assumed. We have a resiliently low time and notice pass-through rate. The fundamentals of the sectors remain the same, very liquid sector and very consolidated sectors, and we have no reason to believe that this overall behavior will change. So, on deposit cost, we do expect to continue a little bit going up for Q2, and then we'll have to navigate the transitional period of rate reduction and how we manage the pass rate as the rates start to decline. But overall, obviously cannot be more specific, but overall, I think what is important for, to emphasize is that the fundamentals of the sectors are the same, remain the same, have been the same in 2023, very liquid, very consolidated, and I have no reason to believe that this behavior will change. Many thanks. The next question comes from the line of Daniel David with Autonomous Research. Please go ahead. Good morning, all. Congratulations on the results. I have a couple of questions. The first one is just on the payout. So looking at the 30% payout this year, on the accrual for 2024, how confident are you on being able to increase that payout to 50%, and potentially related to that, I know your ROTE targets are over a 15% CET1 ratio. When should we think about potentially getting to CET1, or is that the right way to think about it? And then, secondly, just on to touch on cost of risk again. So looking at slide 26, I can see that there are various changes to modeling, so stage one and two, and also in stage three. Could you quantify the management overlays you have left for stage one and two? In stage three, I know there's a one-off modeling enhancement. Are there likely to be any more of these in 2024, or is this just kind of a key one thing? Thanks. Okay, thank you. We have Demetris, our Chief Risk Officer, to comment on the last point on modeling on stage one and stage two. Well, as far as the enhancement in the models, this is something that we do periodically. One of the key changes that we have performed is that we have included additional parameters. For example, we have embedded changing inflations, and that allowed us to release the majority of overlays. The overlays we have at this point in time are insignificant. Okay, let me make a comment generally on the capital return and on the payout ratio. I want to remind you that we always said that we need to walk before we run, and we need to build a track record of delivery, which we believe that we have done. So we started with 14% in 2022, for 2023, and we received approval for, let's say, a meaningful 30% distribution, which is 5 times increasing the cash dividend, plus EUR 35 million of buyback, and also please let me remind you that it is not just about the payout, the very high level of profits and EPS means that in absolute terms, the dividend yield is 8%, which is easily in line with many other European banks. Okay, I want to remind you, of course, that our current dividend policy assumes from 30%-50% payout ratio of adjusted recurring profitability. And of course, we have no desire to hold capital, and if we can, yes, we would like to increase the payout ratio. All the dividend decisions either with related with payout ratios, with buybacks, and any other means of shareholder return, will be taken by the board in the broader bank market concept and at a later stage. And of course, we should have in mind that based on the current share, we still need approval from our regulator to pay dividends. As long as we are sustainably profitable and continue building capital buffers, makes our discussions and our job with the regulator easier towards, let's say, increasing the return to our shareholders. Thank you. As a reminder, if you would like to ask a question, please press star and one on your telephone. As a final reminder, to register for a question, please press star and one on your telephone. Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to Mr. Nicolaou for any closing comments. Thank you. Thank you all for your participation in the call. As always, we are available for one-to-one discussions to provide you with more details and answer more questions. Thank you very much. Ladies and gentlemen, the conference is now concluded, and you may disconnect your telephone. Thank you for calling and have a good day.