Good afternoon, this is the Chorus Call conference operator. Welcome, and thank you for joining the Banca Generali nine months 2021 results conference call. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Mr. Gian Maria Mossa, CEO and General Manager of Banca Generali. Please go ahead, sir. Good afternoon, and welcome to our third quarter results conference call. The overall results for the third quarter are very solid and consistent, confirming the positive trend we saw in the first half of this year. Total assets achieved new high, above EUR 82 billion, thanks to both strong inflows, EUR 5.5 billion, and a very positive contribution from markets. The FA networks continue to grow, both in terms of number of financial advisors and portfolio average. Moving on to the financial results. The net result of the third quarter was at EUR 80.8 million, pushing the first nine months results at EUR 270.9 million, which is a new record for our bank. Also, in terms of capital position, we confirm very solid and well ahead ratios ahead of regulatory requirements, both SREP and MREL. On slide two, as usual, we can see the representation, short representation of our P&L with a very healthy total banking income, up by 37% to EUR 612.9 million, thanks to higher net financial income, very strong recurring revenues, and record variable fees. Operating costs are almost in line with our guidelines, while the non-operating charges spiked. Also, once excluding the provision, the one-off provision, basically due to two main factors. An increase in the FA loyalty plan linked to the excellent commercial results, and a higher contribution for the banking funds. The net results, as I already said, closed at EUR 270.9 million, with an adjusted tax rate at 21.4%. Next page, we can see the breakdown of net profits in the two major components, recurring and variable profits. Starting from the left, the graph on the left, year-on-year basis, the first nine months recurring profits increased by almost EUR 20 million, with the contribution of the third quarter close to EUR 50 million. Precisely it's about EUR 49 million, just the third quarter in terms of recurring profits. If you look at the slide, the graph on the right, we can see also the significant acceleration of the core components in the past years. As you know, this is our priority, and it is basically driven by two actions: asset expansion and a significant operating leverage. As we will see soon, also the operating leverage is getting better and better. Moving on to slide six, there is the build-up of the recurring net profit, with the operating items up EUR 46 million and the non-operating components down by EUR 26 million. In particular, the strongest positive contributions came from net fees, up by EUR 56.6 million, while higher provisions and other adjustments impacted negatively for EUR 80 million. Now, as usual, we're gonna go through the single lines of the P&L, starting from net financial income. On slide eight, we start with interest-bearing assets. The interest-bearing assets increased marginally to almost EUR 14.5 billion, with a temporary increase in liquidity. You can see loans to banks from EUR 1.6 billion-EUR 1.9 billion. This increase is mainly explained by the disposal of selected fixed income securities, basically corporate bonds, with a high risk weight adjusted absorption. This was linked to the fact that we are setting up a portfolio of alternative investments. This new portfolio of alternative investments will include the EUR 380 million, referring to the senior notes of the securitization on national health system. That just to remind you is what we announced during the last conference call when we said that Banca Generali would purchase from clients these assets. The size of the new portfolio will reach up to maximum EUR 550 million, or more or less 4% of total interest-bearing assets. On top of the EUR 380 million of securitization, at least at the beginning, the first EUR 380 million are referred to the senior notes. We will include other strategies, for example, infrastructure and SME loans, so small and medium enterprises. This portfolio will be managed by sector specialists, and it will include, as I said, not only securities, securitization in our system, but also other alternative asset class. In slide eight, you can see also the yield of the interest-bearing assets, down to 0.66% from previous 0.69%. This reduction comes from basically the increase in liquidity. You can see loans to banks from -0.22% to -0.24%, and a further reduction in the yield of financial assets from 0.65% to 0.62%. Stable both loans to clients and the cost of funding. Slide nine, you can see the net financial income. This rebalancing of the portfolios, so the disposal of corporate bonds and to create the liquidity to invest in these alternative investment portfolios have had two main impact on our net financial income. The trading income, of course, had a positive effect for about EUR 11 million, while the net interest income posted a small reduction. Let's say that is less than EUR 1 million due to this rebalancing. One. On the positive side, the current low duration, just to remind you that the overall investment portfolio has a duration of 1.3 years. The high share of variable rate bonds, again, more than 50% of the portfolio is on floating, so it's variable rates, are for us an opportunity in case of, let's say, an increase or normalization of the interest rate. Now moving on to slide 10, we have the usual representation of gross fees. Acceleration pretty impressive. Overall EUR 688 million, driven by both management fees and other fees. The third quarter of this year closed very close to EUR 240 million. Also, in the third quarter, the contribution of variable fees was positive at EUR 31.6 million. I think that the most interesting thing is to focus on gross recurring fees on both components, management fees and other fees. As you can see in slide 10, the overall margin on total assets is at 1.17%. Page 11, to me, is probably the best slide to emphasize the strong acceleration on profitability of the bank. The management fees in the first nine months were close to EUR 587 million. What impressed me more is the acceleration of the third quarter, above EUR 200 million. To be precise, EUR 206.4 million. This is driven by two main factors. First of all, the expansion of the average managed assets. If you compare the third quarter of this year compared to the third quarter of last year, there's an increase of EUR 7.2 billion and acceleration in the margins that went from 1.34% to 1.42% year-on-year basis. The acceleration of margin is driven by two different components. Of course, the positive market trends, so in a higher exposure to equity and the repricing transition of our Luxembourg offer. From the management fees perspective, very strong results. Very strong results also from other fees. Other fees exceeded for the first time in the first nine months, EUR 100 million and closed at EUR 101.5 million, with a yield on total assets at 0.17%. If you focus the attention on the result of the third quarter, the third quarter achieved EUR 32.8 million. You know, during the third quarter, there are several seasonal effects because other fees are strictly linked with the activity with the bankers. You have front fee, you have a certificate, you have trading and so forth. Comparing the third quarter of this year with the third quarter of last year, the increase is close to EUR 10 million. Pretty impressive also this information. On the right, you can see the new revenue streams contribution. First nine months, EUR 57.7 million, and we are well on track to achieve the EUR 7 million target we announced during the last conference call. Significant increase also of the traditional component, from EUR 32 million to EUR 43 million. Basically for two main reasons. The first one, strong entry fees. This is strictly linked to the market performance, and also for the acceleration in institutional brokerage. On the revenue side, great news both from management fees and other fees. On the cost side, page 13, starting from the fee expenses. Total fee expenses closed at EUR 361.9 million, with a total payout ratio, ex performance fee, marginally lower to 52.6. Focusing on the payout to the network, you see ordinary payout pretty stable at 35.9. You know we gave a range guidance between 36% and 37%. You see a further reduction on cost of growth from 11.3% to 10.7%. This is basically from a base effect. Payout to third parties is almost stable and is in line with the target we gave, the 6%. Moving on, page 14. Dealing with operating costs, perfectly in line with our guidance, so up 4.4% year-on-year. Focusing on the third quarter, you can see a spike in the other costs. Basically, the EUR 1.8 million in the blue bar. This is mainly due to the cost linked to the development of our Swiss banking license. On the right you have the breakdown of core operating costs. Everything is in line with the previous trends. As revenues expansion, costs under control. The result is a great operating leverage. You can see our usual ratios, operating costs on total assets and cost income ratio. Starting from the first one, operating cost on total assets is below 0.3. That was a sort of floor for us, 0.28. Also cost income ratio is definitely lower than 40%. Also once adjusted for the more variable components of the revenues, cost income closed at 34.4%. Last but not least, capital ratios are pretty solid. CET1 ratio is in line with the same date as of the first nine months of last year. TCR at 16.4. Leverage ratio above SREP requirement, and all liquidity ratios are well above the minimum requirement. Just to remind you that these capital ratios include the dividend provision for 2021, in line with our dividend policy, and include also the EUR 3.3 of dividend for 2019 and 2020. The financial results are very strong, and this is driven by very strong commercial results. Starting from page 18, asset expansion EUR 82.1 billion, with stable or lower traditional life policies, acceleration in managed solutions, and acceleration also in banking products, partly driven by advisory services. The acceleration in managed solution is above EUR 7 billion. These are driven by all the managed solutions, with the highest contribution coming from the insurance wrappers. As we announced, there is a constant steadily rebalancing from traditional life policies to insurance wrappers, now at EUR 8.10 billion. In-house funds, third party funds, and financial wrappers growth grew steadily. It's good news also from this side. Banking products continue to grow linearly, and again, this is supportive also for the advisory fee mandate. Page 19, there is the focus on our Luxembourg asset management platform. We exceeded EUR 20 billion for the first time, EUR 20.2 billion, and great part of the acceleration, of course, came from the LUX IM, EUR 15.3 billion. On the right there is a representation of the net inflows in retail fund classes. You have two different histograms. The red one is about total net inflows in the LUX IM retail fund classes. If you compare the third quarter of this year with the third quarter of last year, you see that there is an acceleration of EUR 100 million. The gray bar is about the overall retail inflows, net inflows. You see that in this case the gap year-on-year is even higher. Why? This is, in my opinion, the result of the optimization of the prices and of the relaunch of our Luxembourg platform presented in July. Numbers are good because the feedback of our financial advisor, as well as the feedback of our clients were good. I continue to be positive and supportive on our Luxembourg platform. Moving on to net inflows. Page 20, you can see the total net inflows in terms of a mix. This is really important, EUR 3.7 billion in asset management products with a deep transformation from a model based on traditional life insurance products to a model able to grow, providing advisory in very sophisticated managed solutions. EUR 3.7 billion of net inflows, well spread across insurance wrappers, financial wrappers, third party funds, and in-house funds. Page 21, there is the net inflows by acquisition channel representation. What impressed me more is the constancy of the outflows over phase. It's very negligible, EUR 200 million per quarter, even if the assets continue to grow. The existing network accelerate in terms of productivity, and we restart the recruitment activity as announced in the previous conference call. Recruitment trend accelerate. In October, we exceeded 100 new colleagues, and as you can see, is well balanced from both retail and private bankings, banks and FA networks. Slide 22, there is also an anticipation of numbers for October. October was a good month, EUR 560 million, in line with last year, but with better quality, and is well represented in the histogram of managed solutions. Asset under advisory achieved EUR 7 billion. November started very well. Financial results, very strong. Commercial activity, even stronger. Well-positioned to be a record year also in terms of total net inflows and in terms of quality of these net inflows. The last chapter is just to recap our current strategic plan. Because our plan is approaching to completion. Just to review with you the three main goals, the three main pillars of our strategy. As we announced during our investor day in London, the first pillar was about growth. We want to be among the fastest growing company in Italy. We gave two different targets. The first one was in terms of total assets. We gave a range of EUR 76 billion-80 billion, and we are already well above the highest boundary. We are at EUR 82.1 billion without significant acquisition and also thanks to market performance. A great contribution has been coming from also the net inflows. We announced a target of no less than EUR 14.5 billion. We already achieved 16.5, and we are confident to deliver no less than EUR 18 billion once the fourth quarter of this year will be included. The first goal, we can say, has been achieved. Not just growth, because our focus was on profitable growth, sustainable growth. We can move on page 25, where you see the targets we gave, both in terms of core net banking income and core operating costs. Core net banking income, the target was above EUR 63. To me, this was the challenging target, and we are now at EUR 67. This is, of course, driven also by the positive market performance, but also from the diversification of the revenues and the repricing of our Luxembourg platform. Costs are well under control, in the range of EUR 35. We represented also the core operating results on the right because it's a way to present our operating leverage. You can see the core net banking income, the core operating cost, and the core operating results. We represented in the box, in the red box, what we define core cost coverage. The ratio of core net banking income, so the income generation of the bank, the core income generation of the bank, on the core operating cost. You see that this number is getting better from 2.16x in 2018 to 2.59 as of today, in the first nine months of the year. We can say that also the second objective so far has been delivered. The third one, you know, we like to say, we love to say we are a growing company focused on sustainable revenues, on profitable growth, and able to be considered also as a value company, able to remunerate our shareholders. You know that we have already accumulated EUR 3.3 per share, and we are looking forward to paying the first tranche in the next days, EUR 2.7. The second tranche will be paid in February of the next year, 0.6. Also the DPS for this year is well above the floor of 1.5, 1.25. Also the third goal, in my opinion, has been achieved. What seemed to be during our investor day, a very challenging strategic plan has been delivered. We delivered on promise. It's really important for our management team. We achieved these goals thanks to a multi-strategy, multi-project strategy. Now we have been working for the last month on the next three, five years. I'm glad to say that we will organize a new investor day next year in February to deal with our strategic levers to accelerate in the number of clients, in providing even more opportunities to our financial advisors, and leveraging our unique value proposition that is based, of course, on the quality of our financial advisors, but also on technology and on sustainable growth and sustainable culture. Thank you. Now I will hand over for the Q&A session. Excuse me. This is the Chorus Call conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time. The first question is from Giovanni Razzoli with Deutsche Bank. Please go ahead. Good afternoon to everybody, and thank you for taking my questions. I have two. Clearly there is a strong increase in management fees quarter-on-quarter. There is a very good news. I was wondering how much of it already reflects the new pricing scheme because you rightly so mentioned that there is also a contribution of better product mix. My perception is that good news are also coming in the next two quarters as you continue to roll out the new pricing scheme. I was wondering whether this understanding is correct or not. Second question, I was wondering if you can share with us what is the expectation for the performance fees in the Q4. You've been relatively you know prudent in the last conference. You mentioned EUR 20 million- EUR 30 million of performance fees. You booked EUR 32 million this quarter. If you can give us an indication of it. A follow-up, if I may, also on the exposure to clients to equity products. If you do have this figure and you can share with us, that would be much appreciated. Thank you. Thank you, Giovanni. First of all, first question on management fees, you are right. The numbers of September include, I would say, 50% of the repricing. You will see further increase in the fourth quarter. You are right, because we launched the new price scheme, let's say, at the beginning of August. The second is on performance fee on Q4. I'm very conservative because I'm conservative on end markets. Let's say that all, greatest part of the assets are at or close to the highest level, so to the high watermark. As of today, performance fee are negligible, but we are again very close to the high watermark level. In terms of overall exposure to equity of our clients is at 28% on total assets. As you know, our strategy has been focused on creating this constant switch from cash to equity. Probably the equity exposure could increase a little bit further in the next six, 12 months. Thank you very much. Very clear. Thank you. The next question is from Domenico Santoro with HSBC. Please go ahead. Hello. Hi. Good afternoon. Just a clarification, first of all, on the repricing, because of course the numbers are strong, and I want to understand correctly. I remember that the repricing effect was EUR 25 million- EUR 30 million on an annual basis on the stock. Since now you say that you've done 50 of these. My understanding, is it correct that you just benefited from EUR 3 million- EUR 4 million incremental revenues from repricing in the quarter and the same is gonna be recovered in the fourth quarter? The second question is on your expectation for next year, because, I mean, this has been a very strong year, 2020, as well, in terms of sales. Now, you're changing the asset mix from what I have understood in order to benefit from rate hike. Everything is changing, of course, because ECB might stop, you know, the PEPP in March. We already experienced some increase in the sovereign spread that at the end of the day is a competitor for you. I just wanna understand for next year whether you have expectation of repeating these very strong sales or maybe you have sense that the appetite from clients will be a little bit more moderate. Talking about the recurring stream that you upgraded the beginning of the year, the guidance. I mean, we don't have the detail here of certificates, but also I want to understand your expectation for next year whether these kind of revenues are repeatable. Just a question on the payout. The 80% that you say you accrued in the capital, is this applied to the whole net profit, including performance fees, or you freeze part of them in order to avoid a sort of a cliff effect on the dividend? Thanks. Thank you, Domenico. In your projection or estimation of the contribution from management fees of the repricing, you are right. It's EUR 3 million-EUR 4 million, considering we launch it the first week of August. It means five weeks. Seven weeks out of 12 are included, so basically. You are right. The second question, if I understand well, you asked me about the expected inflows for the next year. Let's say that the end of the year, the second part of the year is even stronger than the first one. Of course, you are right. There are several levers and several reasons for this acceleration. Market banking turbulence and a growing need for advisory, you know, sense of protection. This is in my opinion something driven by and accelerated by also COVID. Let's say that now we are well above my expectations. We will take time during our investor day to give you new guidelines for inflows for the next three, five years. I can say that in this moment, I'm pretty surprised by the acceleration on certificates. Certificates are the king of the other fees, other revenues, because you know you have several of these that are paying back to clients, so we are basically just reinvesting their money. The turnover is increasing significantly. In terms of net position, we haven't increased significantly the exposure, the overall exposure to certificate. The portfolios are not saturated, but it's been increasing over time, the turnover. The numbers for the third quarter are very impressive, as well as the numbers that we have seen so far in the fourth. I do expect the normalization driven by markets, not by the appetite. The payout of 80% includes also the performance fee. This doesn't imply the fact that we're gonna pay 80%. It's just a conservative approach to take account of the current dividend policy. It's right, it's 80%, all inclusive, so inclusive also of the performance fee. That doesn't mean we're gonna pay 80% of the net profit because we are thinking of a new dividend policy to smooth, as you correctly said, the in absolute terms, the dividend payments. That means that the 80% is what is accrued at the moment, but the dividend might be lower just to smooth over the. Exactly. The accrual is 80%. It's very conservative. The dividend policy is floor EUR 1.25, range 70%-80%. We are thinking of, as we already done with the tranches of the dividend, how to smooth the dividend payment. All right. Thank you. Thanks. Thanks. The next question is from Gianluca Ferrari with Mediobanca. Please go ahead. Yes. Hi, good afternoon. Ciao, Gianluca. I am back on the repricing effect. I'm looking at your page 32, where you are estimating 5-6 basis points and a margin overall at 140-243. You showed us that you are already there, basically, and you are telling us that you still have 3.5 basis points missing. I'm wondering if there is upside risk to this 140-143. I think you already explained an answer to this question, but I wanted to be very sure about this answer. The second question is on the NII. I think in the last call, we talked about flat to -2%-3%. Am I right if, after this Q3, we are going closer to the -2%-3% kind of expectation for a full year 2021? On this point, if you have a guidance for 2022, where is the NII going? The last question is, I'm curious to hear something more about the EUR 1.8 million investment for the Swiss banking license. What kind of activity you exactly did to explain this EUR 1.8 million? Is reinforcing the staff you have there, or what else did you do here? Thank you. Thank you, Gianluca. On the repricing side, let's say that I see other two maximum three basis points, more closer to two than three, of the repricing. The equity exposure and a potential rebalancing on, let's say, other strategies of the new offering could give an extra support. Let's say that I continue to be positive because things are going the right direction. Performance are working very well. Performance for the client, as you know, very well. I'm more confident than in the past, in terms of asset management. Let's say that part of the performance of the profitability is linked to the market. If you think of stable market, we can do something even better. If you think of more volatile market, the projections still are a little bit stretched. In terms of net interest income, let's say that the deceleration of the net interest income in the third quarter will continue also in the fourth quarter. The overall effect will be worse than the previously announced. It will be more in the range of EUR 5-EUR 7 than EUR 2-EUR 3 for this year. While for the next year, I don't see a negative impact on year-on-year basis, but we will deep dive on our investor day on this one. On the extra cost, other cost, EUR 1.8, of course, is not all about this Swiss project, but we say that we start recruiting the staff, we give mandate to consulting companies, we are preparing the filings for the FINMA, so you have some one-off cost plus the setup of the team. We already appointed the CEO, the chairman, the COO, and so forth. We are accelerating because we do think that this will allow us to have an extra engine of growth for the next years. Thank you. Thank you very much. Very clear. The next question is from Elena Perini with Intesa Sanpaolo. Please go ahead. Yes. Good afternoon, congratulations for the results. I've got one question on your slide number 24. Looking at the 2021 new target of EUR 18 billion cumulated. Actually, this means, if I can understand correctly, that you expect additional EUR 1.5 billion in the last two months of this year. A better November and December compared, for example, to October. Thank you very much. Thank you, Elena. Just to be fully clear, probably I didn't specify in the slide that 16.5 billion is what we achieved at the end of the first nine months. In the next three months, in the fourth quarter, we do expect no less than EUR 1.5 billion. Considering the half billion EUR plus of October, it means that for November and December, we do not expect less than EUR 1 billion. Okay. Thank you. Very clear. The next question is from Angeliki Bairaktari with Autonomous Research. Please go ahead. Ms. Bairaktari, we cannot hear you. Maybe your line is on mute. Yes. Good afternoon. Thanks for taking my questions. My first question is on the launch of the portfolio of alternative investments that you presented. I just wanted to ask, what is driving this change in your strategy? Especially you mentioned that you're looking to invest in SME loans and infrastructure, which seems rather exotic for a bank of your size. Can you explain to us sort of how you foresee that the impact of those investments is going to be negligible in your risk-weighted assets, please? Second question, the entry fees, the front fees were very strong despite the usual summer seasonality. I just wanted to understand what drove this. In particular, which products. Last question on the October flows that you presented. You had EUR 600 million net flows in deposits. Was by any chance part of that linked to the buyback of the healthcare receivables securitization? If yes, do you expect those deposit flows to be converted into managed assets over time? Thank you very much. Thank you, Angeliki. Let's say that the first question is on our banking book. Let's say that during the build-up of our business plan, we decided to diversify the banking book also through illiquid assets. Now, we decided to gather all the major part of the illiquid assets under an umbrella fund, so it's coherent with what we announced, let's say, what we decided as a strategy of the bank. In this case, we decided to redistribute the risk of the portfolio from corporates to, let's say, alternative investments, including also the senior notes of the securitization. Let's say that we sold the corporate side of the investment of the portfolios, and we're going to invest in, let's say, infrastructure. This is a way to switch from, let's say, credit risk towards illiquid risk. It's about EUR half billion, and it hasn't significant impact because we rebalance the portfolio by selling some corporate and by reducing also existing illiquid strategies. Nothing significant but, let's say, a choice to diversify, to continue to diversify, to invest in the portfolio of the health system. Entry fees, the numbers impress me a lot, because there aren't specific initiatives. It's about, of course, a sort of rebalancing of our Luxembourg platform. Since we launched our Luxembourg platform, partly could be by a switch to the new strategies, for example. The net effect is zero, but you still have some front fees, and also front fees on third-party funds. The performance are very strong, so when you have a strong performance, you can charge front fee, exit fee. This is, in my opinion, a momentum effect. You are right on the third point. The extra cash in the inflows of October are driven by the purchase offer to our clients of the securitization. This cash, at least in part, will be definitely reinvested in the next months. Thank you very much. The next question is from Luigi De Bellis with Equita SIM. Please go ahead. Yes, good afternoon, and thank you for taking my question. Two left for me. The first one is on the payout to the network. What is the trend expected for 2022, considering also your recruitment strategy? The second question on Switzerland. Could you elaborate on your strategy, providing us an update on the opportunity, on the development of the Swiss banking license and the goal for 2022 in terms of assets under management, and an update of the target market for you in the country and the competitive scenario? Thank you. Thank you, Luigi. Yes. I don't want to anticipate topics we're gonna present during our investor day in February, but I can tell you that the payout ratio for this year will be pretty stable, and we will define the strategy for the next three, five years and will be presented during our investor day. I don't see significant changes. Switzerland, let's say the next year will be invested to set up the new bank. Why we're gonna accelerate this process? Because next year will be pretty disruptive in terms of regulatory change. It's changing the framework, the regulatory framework in Switzerland. From these changes, we see some growing opportunities. We're gonna set up this new banking license from scratch in order to have no reputational risk. We do see both the possibility to acquire assets in Switzerland or Swiss clients, as well as to be a reference point for the Italian clients who want to diversify the booking center. Again, also for this reason, you will receive an update of our expectation in terms of assets in February. Thank you. Thank you. Gentlemen, there are no more questions registered at this time. I turn the conference back to Mr. Mossa for closing remarks. Okay, thank you very much. I hope to see you all in February for our investor days. Have a great day. Thank you.