Good morning, this is the Chorus Call Conference Operator. Welcome and thank you for joining the BPER Full Year 2024 Consolidated Results Conference Call. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. At this time, I would like to turn the conference over to Mr. Nicola Sponghi, Head of Investor Relations of BPER. Please go ahead, sir. Thank you and good morning, everyone. I'm pleased to welcome you to our fourth quarter 2024 earnings conference call. Before I give the floor to our CEO, Gianni Franco Papa, please know that our slide set and press release can be found on our corporate website. I would also advise you to take note of the disclaimer on slide two of the presentation document. That said, after the presentation, our CEO and our CFO, Simone Marcucci, will take care of our Q&A session. I will reiterate that this is reserved for financial analysts who might kindly request to ask a maximum of two questions each, so that everyone will have the opportunity to contribute to today's call. Thank you very much. I will now leave the stage to Mr. Papa, CEO of BPER. Thank you, Nicola, for your introduction. Good morning to everyone and welcome to our end-of-year results presentation. Italian banking seems to be undergoing a very exciting moment, I should say. Given last evening's announcement on a potential business combination with Banca Popolare di Sondrio, I would like to underline that the financial performance illustrated in this year-end presentation is based on BPER standalone on a constant perimeter basis. That said, before I start giving you details of our financial performance, a couple of highlights on the progress of our B-Dynamic Full Value 2027, which is well on track. NII has proved to be resilient thanks to commercial spread increases, improved funding mix, and in the second half of this year, a positive volumes growth. Commissions have had a very positive run throughout the year and are on track to meet planned targets. Our cost to income stands at a very healthy 50.3%. The quality of our loan book continues to stand at the best levels in the Italian banking industry, with a cost of risk of 36 basis points. The bank's liquidity profile remains robust, with LCR and NSFR ratio broadly in excess of the minimum threshold required. We maintain a very solid capital position with a CET1 ratio at almost 16%, with an organic capital generation amounting to 319 basis points, equal to €1.7 billion in the last 12 months. Finally, we generated an adjusted net profit of €1.4 billion, translating into a return on tangible equity at 16.9%. These outstanding results allow us to propose a dividend per share of €0.60, which will translate into a payout ratio of 61%, over a 100% increase versus last year. Please be reminded that we have added a new slide in the appendix on page 27, which summarizes all adjustments for full year 2023 and 2024. Let's move on to the next profit drivers on slide number five. As you can see, thanks to the efforts of all our employees, we have been able to demonstrate a positive performance of core revenues throughout the year despite the adverse interest rate scenario. Operating costs were up by 3.6%, bringing the operating income at over EUR 2.7 billion, flat year on year. The very high quality of our loan book and the conservative coverage ratio translated into a lower level of loan loss provisions. As a result, the bank-adjusted net profit reached EUR 1.4 billion, posting a 4% growth year on year. In the pages to come, we will provide you with an in-depth review of each and every item. As you can see, the bank successfully met its guidance for 2024. As we are confident in the delivery of our results, our overall guidance along our 2025-27 plan remains unchanged. As already mentioned, please bear in mind that the following guidance is based on BPER standalone, therefore not including any impact from the business combination with Banca Popolare di Sondrio. For 2025, I would like to underline the following: we expect NII to be conservatively in line with 2023. Commission income is expected to continue to post a positive performance. Operating costs, excluding depreciation and amortization, are expected to decrease. We expect the cost of risk landing at a slightly higher level versus 2024. And finally, net profit is expected to be slightly above 2024. Now, I would like to move on to the core part of the presentation on slide eight. I'm pleased to share our progress towards building a stronger, more resilient bank for the future. Overall, I'm proud to report that 80% of the business plan initiatives are already underway, and we are on track to fully implement all of them by the end of the first half of 2025. I will briefly comment on the progress of the four pillars of our plan. In line with our expectations, commissions were driven by strong performance in bank assurance, plus 29.6%, and wealth management, plus 7.1%. Additionally, loan volumes increased with new lending up at EUR 17.4 billion, translating into an increase of the overall loan portfolio of 2.2% in the 12 months. Regarding the second pillar, attention to costs and the launch of several initiatives have allowed us to maintain a strict cost discipline. In financial year 2024, the planned 77 branches were closed, including 74 in the last two months. Our capital ratio remains strong with very healthy NPE and coverage ratios. The bank modernization is progressing rapidly. Initiatives in technology, security, and AI have been launched, and CapEx will be deployed according to our plan. During 2024, our ESG rating has been upgraded, demonstrating our solid commitment to sustainability. Finally, I want to highlight that for the sixth consecutive year, we have been recognized as a top employer in Italy. In December 2024, we also launched BPER Corporate Academy to foster talent development. Let's now turn to our financial performance. As you can see on the slide, total revenues increased by 1.8% in 2024 versus 2023, reaching almost EUR 5.6 billion. This was achieved thanks to resilient core revenues, which were up by 4.1% at EUR 5.4 billion. Given the overall interest rate scenario, this is an outstanding result. Among the main drivers of total revenues, I would highlight the following: robust NII in spite of lower rates, and a strong performance in commission income, which increased by 4.5% thanks to the positive contribution of AUM fees and non-life insurance products. As you can see, Q4 has been particularly strong in terms of commission income growth, plus 13.9% quarter on quarter, thanks to the strong performance of all wealth management activities and bank assurance. To be noted, the continued solid trend in productivity, with the net revenues to risk-weighted assets ratio, which increased from 8.6% to 9.5% between Q1 2023 and Q4 2024. Let's move on to the next slide, which focuses on net interest income. Given the interest environment, I'm extremely pleased about the performance of our net interest income line. Achieving a growth of 3.9%, lending at €3.4 billion, has been an outstanding result thanks to commercial spread increase, benefiting from higher commercial rates in the first part of the year, combined with an improved funding mix. In the quarter, NII performance was also very positive, increasing to over €850 million. Major drivers were loan volumes and treasury-related activities, related mainly to the bond portfolio and interbank lending. As you can see, spreads were slightly narrower in the quarter by a matter of single-digit basis points, while volumes more than compensated the negative effects of rates. Finally, I would like to highlight that our NII sensitivity to 100 basis points movements equaled to approximately €165 million in the quarter, basically unchanged compared to the previous quarter. Now, let's move on to the development of net commission income. In the last 12 months, commission income grew by 4.5%, standing at almost €2.1 billion, as a result of the focus the bank is placing on capitalized high-quality non-interest income. The most important contributor, which represents more than 50% of commissions, were fees from banking services, which almost reached €1.1 billion. In Q4, fees from non-life insurance, up by 30%, and from assets under management, up by over 15%, reported the most important increase. In particular, non-life insurance fees soared due to the year-end performance fee related to the extraordinary levels of productivity of our sales force. In this context, I would like to underline that recurrent AUM and AUC fees continue to show positive progress, increasing by 4% quarter on quarter. Let's move to the next slide, which focuses on the progression of total financial assets. Total financial assets grew by 5.5% in the last 12 months, driven by assets under custody and assets under management. In the quarter, total financial assets grew by almost €3 billion. These were driven by an increase in deposits, AUM, and AUC, and thanks to positive market effects and customer asset conversion. Let's move on to our performance on the cost side. In the last 12 months, total costs were up by a mere 3.6%, reaching a cost to income ratio of 50.3%. As we mentioned in our last earnings calls, the spike in Q4 versus Q3 was driven largely by seasonality and the impact of higher D&A and HR costs. The waterfall chart reports the key drivers of HR costs during the year, where HR-related cost synergies almost compensated the increase related to the national collective labor agreement and new hires. Please note, at year-end, we achieved further progress by optimizing our branch network, reducing the total count by 77 branches and lending at 1,558 branches. Let's move to cost of risk, where the bank showed very good progress. As you can see on the slide, in the last year, loan loss provisions came down by more than 20%, landing at € 333.3 million, bringing the cost of risk down to 36 basis points. Similarly, on a quarterly basis, the cost of risk has shown a very positive progression, falling to 63 basis points in Q1 2023 to 28 basis points in Q4 2024. Needless to say, that this underlines the high quality of our portfolio. I would like to mention a couple of other points which I deem key in the context of the quality of our loan book. Our NPE coverage ratio remains substantially stable at 54.3% quarter on quarter, and one of the highest among Italian peers, despite the disposal performed in the quarter. Our conservative approach is further confirmed as we report a financial year 2024 coverage ratio on performing loans at 0.7%, among the highest in Italy, and total cumulative overlays stood at approximately € 237.1 million, increasing quarter on quarter with a plus 15 million versus Q3 2024. Let's move on to asset quality on the next slide. The quality of our loan book continues to show a very healthy state. From a stock perspective, gross NPEs came down by 300 million in the quarter, merely unchanged from year-end 2023. In particular, bad loans decreased by 200 million on account of asset disposal and proactive collection activities. The fact that BPER is characterized by a high-quality loan book is further highlighted by the net NPE ratio, which, as you can appreciate, continues to improve and is one of the lowest in the Italian banking sector at 1.1%. Excuse me. Having finished with asset quality, let's move on to the development of the bank risk-weighted assets. As you can see, in Q4 2024, our total risk-weighted assets slightly increased quarter on quarter due to the annual update of operational risk, which contributed to EUR 1.1 billion. Credit risk-weighted assets declined by roughly EUR 300 million to EUR 45 billion, thanks to capital-light credit origination. I will now turn to organic capital generation on the next slide. In terms of capital, we continue to post a very strong organic capital generation, reaching a CET1 ratio of 15.8%, despite the negative impact of higher operational risk-weighted assets in Q4. Excuse me. In this context, it is important to underline that BPER continues to generate significant organic capital, amounting to €1.7 billion or 319 basis points in the last 12 months. Moving on to liquidity, let me point out that the bank's liquidity ratio remains high. The LCR reached 167% at the end of December 2024 versus 161% at the end of December 2023. Similarly, the NSFR increased to 138% from 128% at the end of December 2023. In Q4, the loan deposit ratio stood at 76%, stable Q on Q, one of the lowest among Italian peers. Turning now to the bond portfolio, we point out that Italian government bonds amounted to €11.3 billion and accounted for around 42% of total bonds. In Q4 2024, the bank continued to increase its holding of Italian government bonds to capitalize on prevailing market conditions. The duration of securities portfolio was restored to levels comparable to those observed in Q2 2024. Specifically, in Q4 2024, the overall portfolio duration stood at 2.1 years, while the duration of the Italian government bonds portfolio reached 2.5 years. A brief look at our latest bond issuances is important. In November, the bank successfully issued a new EUR 500 million Additional Tier 1 Perpetual Bond with a call option on March 20, 2030. This issuance further underscores BPER's successful access to institutional bond markets in 2024, reinforcing its status as a frequent issuer and reflecting strong investor confidence in the bank's credit profile. Also noteworthy that Fitch upgraded BPER to positive outlook in January 2025. On slide 23, we report the new divisional financials, as we had already anticipated. I would like to draw your attention to the important results achieved on total wealth fees created across our divisions, which amounts to almost EUR 850 million. Ladies and gentlemen, a brief summary of the most important achievements of 2024. 2024 guidance has been successfully achieved. The dynamic full value 2027 is progressing positively and is well on track. All initiatives will have been launched within the first half of this year. Growth was driven by a positive performance in core revenues with a sound cost of risk. Our risk discipline remains unchanged, and our asset quality stands at the highest levels within the Italian banking sector. And finally, we continue to generate significant organic capital amounting to EUR 1.7 billion or 319 basis points. As such, on a BPER standalone basis, the proposed dividend for 2024 is reported at EUR 0.60. This translates into a payout ratio of 61%, a 100% increase versus last year, fully on track to deliver a sustainable 75% payout ratio over the planned horizon. Thank you. Okay. And now we leave this presentation, and we will present the business combination presentation. And after, we will have the Q&A session. Okay. Ladies and gentlemen, the time has come for BPER to take a bold step in the context of Italian banking. As one of the largest banks in Northern Italy, we need to maintain an important role in the Italian banking landscape. On this premise, yesterday evening, the board of directors of BPER has decided to promote a business combination with Banca Popolare di Sondrio. Our plan, B-Dynamic Full Value 2027, will be further strengthened and accelerated by this business combination. A combination which has been very carefully analyzed and which will reap the benefits of a perfect fit in terms of clientele, geographical footprint, and potential synergies, creating further value for all stakeholders, both BPER's and Banca Popolare di Sondrio's. Banca Popolare di Sondrio has a strong franchise in the rich Northern Italy. It has a very similar historical background to BPER, as its origins stem from the Banca Popolare, and ensures an important client fit. This is a unique opportunity to combine two banks with a very similar DNA, which share very similar values and missions. That's why we believe that the integration of the two banks will be swift and effective. This will translate into the creation of a leading Italian banking group, a group which will rank third in terms of TFAs, deposits, and loans. The combination will transform BPER and Banca Popolare di Sondrio into a stronger banking group capable of seizing future opportunities, while at the same time ready to withstand any potential challenges. Both brands will be preserved in all historical areas, given the strong customer franchise and proximity to clients. Customers will benefit from the wider product and service offer and the important investments in IT, which both groups have carried out and will continue to be carried out by the new group. The combined banking group will foster investments in its combined human capital. It will allow employees and especially talent pools to exploit all educational activities to ensure that its unique workforce will ensure a sustainable long-term growth of this new innovative banking group. Allow me to underline that we expect the transaction to be mid-single digit accretive on EPS, including run rate synergies and calculated on consensus estimates for both BPER and Banca Popolare di Sondrio. We then expect a net income comfortably above EUR 2 billion, including synergies, in 2027 and a return on tangible equity of approximately 15%. We plan to deliver a shareholders' remuneration at an average payout ratio of 75%. This is an important benefit of the proposed business combination for all shareholders, in particular for those of Banca Popolare di Sondrio. In addition to all these considerations, Banca Popolare di Sondrio shareholders will receive a premium of 6.6% versus Wednesday closing price and 10.3% versus the last three months' weighted average price. We are convinced that the offer is extremely attractive for Banca Popolare di Sondrio shareholders. Now, let us move on to the details of the business combination. I would like to highlight why we believe that Banca Popolare di Sondrio is the best industrial fit for BPER. As you will appreciate on the slide, there are numerous important features that have been evaluated. Firstly, Banca Popolare di Sondrio has a leading presence in Lombardy, with a market share of approximately 7%. I remind you that Lombardy is one of the most dynamic and innovative regions in the whole of Europe. Secondly, Banca Popolare di Sondrio benefits from a widespread customer base of around one million clients. In addition, Banca Popolare di Sondrio is a strong fit with negligible overlap given its geographical presence. The unique client franchise of Banca Popolare di Sondrio, skewed towards SMEs, would allow a more balanced group franchise between corporates and retail. But most importantly, the two banks have very similar business models, leading footprints in their local territories and client proximity. This is exactly why the fit between the two banks is a perfect one, be it by values and mission, culture, business, and franchise. As such, I'm convinced that the business combination will be a unique platform to support Italian families, SMEs, corporates, and local communities by placing our clients at the center of our offer and supporting them in a long-term sustainable manner. On top of the business fit, Banca Popolare di Sondrio is characterized by a very robust capital position with a CET1 ratio in excess of 15% and a very high asset quality with a sound coverage ratio of approximately 62%. Remarkable features, which are very similar to BPER. This is particularly important in the current banking M&A context, where we anticipate significant business disruption deriving from the other well-known business combinations in the banking sector. We now move to the business combination and what it would yield. Allow me to start stating that the proposed combination with Banca Popolare di Sondrio is fully coherent with BPER's plan presented last October in terms of strategic objectives, strengthening and accelerating BPER's path for sustainable growth, both in terms of bottom line, organic capital generation, and shareholder remuneration. As already mentioned, the combined group will become the third largest group by TFAs, deposits, and loans in Italy, with a market share of approximately 7%. In this way, the combined entity will have a very strong footprint in the richest Italian regions, and the unique customer franchises will be protected by maintaining both brands in historical areas. That said, the combined platform will permit further customer outreach and will benefit from already existing well-known common long-term partners and joint product factories in private banking, asset and wealth management, and bank assurance. I'm convinced this to be a strong base for a long-term sustainable, high-quality revenue growth of the combined entity. We expect the business combination to yield significant value creation from synergies, which are conservatively, let me repeat, conservatively estimated at EUR 290 million to be finalized in full from 2027. This will be achieved with a smooth integration and very limited social impacts. In detail, EUR 100 million of pre-tax revenue synergies and EUR 190 million from costs. We expect integration costs to amount to approximately EUR 400 million to implement these synergies. The business combination will result in a more solid and resilient group with a revenue base of well above EUR 7 billion, EUR 4 billion of operating income before loan loss provisions by 2027. In addition, based on latest available financials, the combined group will benefit from an expected net NPE ratio of 1.1% among the best in Italy, a very robust capital position with a CET1 ratio of above 15%. Looking at 2027, we estimate a combined profit base of over EUR 2 billion and a return on tangible equity of approximately 15%. In our strategic analysis, an important angle has been the value creation for Banca Popolare di Sondrio shareholders, which are core to the whole business combination. First, from shareholder point of view, there are tangible benefits. A higher liquidity of the stock will enable the new banking group to come in the radar screen of large, long-term institutional investors. In addition, a larger market capitalization will permit the entry into additional stock indices, which will attract large active and passive investors. This should be an important benefit for both retail and institutional investors in Banca Popolare di Sondrio. Shareholders will hold the stock in a more solid and resilient banking group with a significant earning power and internal organic capital generation. In addition, shareholders will benefit from the envisaged synergies deriving from the business combination. Moreover, Banca Popolare di Sondrio shareholders will also benefit from a higher dividend payout ratio. Secondly, as far as clients are concerned, the new bank will reinforce and broaden the proximity client coverage model, becoming a go-to bank for families, SMEs, and corporates. The larger product base will permit customers of Banca Popolare di Sondrio to unleash their full business potential. This will benefit from a higher investment capacity in products and service innovation and digitalization, as well as the ability of the joint banks to scale up investments in technology. And finally, Banca Popolare di Sondrio human capital, a key feature to enable the successful integration and long-term sustainable growth of the combined entity, will be fully empowered in the new banking group. Banca Popolare di Sondrio's employees will benefit from a dynamic environment and upskilling programs to further support and develop career opportunities, also given the many initiatives in place to nurture and grow the talent pool towards high-added value activities, one of these being, for example, the BPER Academy project. Let me add that historically, such business combinations have created important opportunities for the career development of talents. As an example, current top and middle management of BPER is composed of individuals coming from the banks merged into BPER. All in all, we believe this to be a great opportunity for all of Banca Popolare di Sondrio stakeholders. We'll now move to the market positioning of the combined bank on the next slide. I will comment this slide very briefly, as I already commented on the combined position of the two banks. As you can see on the slide, the combination will confirm the two banks into third position by TFAs, deposits, and loans. These key features underline the strong customer franchise and the potential for the new bank to tap into high-quality revenue growth and commission income opportunities. We'll now turn to another key feature, the strategic position of Banca Popolare di Sondrio geographic footprint. Achieving a leading position in the richest region of Italy, which represents 70% of total Italian export, is undoubtedly a key competitive advantage, allowing the new group to serve customers with a vast array of banking products. I am particularly excited about the footprint in Lombardy, which the business combination will bring. In this region, the most dynamic, export-driven, and innovative in Italy, BPER will double its presence from a market share of 7% to 14% of the combined entity. A clear example, in my view, would be the outreach of transaction banking services aimed at serving customers along their full value chain. In the context of the merger, the new group will serve approximately 6 million clients combined and will transform itself in the go-to bank as a leading franchise in Italy. At the same time, the client profile of the combined group will shift towards a more balanced and diversified business mix, as Banca Popolare di Sondrio has a higher proportion of corporates and SMEs. The last strategic factor underlying the beauty of the business combination is the fact that the new group will be able to enhance its array of products and services to its customers, leveraging on existing consolidated high-quality product factories. In this way, the combined group will be able to increase fee income generation in asset management, leasing, and bank assurance. In the context of our business plan, which focuses on boosting commission income, BPER will bring an enriched product offer: excellence in private banking and wealth management, factoring and consumer finance, and digital banking and payments, an area in which BPER has invested time and money. In this context, we anticipate that the combined entity will hold a balanced mix of core revenues with approximately 65% deriving from NII and approximately 35% from commission income. As you will see on the next slide, we have identified a number of levers on which to focus in order to further strengthen growth in commission income. Translated into figures, the strategic fit will translate into total pre-tax annual synergies conservatively estimated at €290 million. Firstly, at least €100 million will derive from revenue synergies. These are estimated to stem mostly from the alignment of Banca Popolare di Sondrio network productivity to BPER's and partly from the implementation of BPER's commercial best practices, those mostly impacting the fee income line. Secondly, we estimate EUR 100 million from cost savings related to the rationalization optimization of central functions, the improved efficiency in processes and operations, the optimization of the branch networks, and shared investments in technology and digitalization. Integration costs estimated at approximately EUR 400 million will be mostly expensed in 2025 for 75% and the remaining part in 2026. We believe there is a scope to do even more synergies once the full integration of the two banks is achieved. Simulations based on latest financial indicators position the new banking group very positively. On asset quality, the net NPE ratio would stand at 1.1% versus a peer average of 1.5%. Similarly, the net coverage ratio would be more robust, standing at 57% versus a peer average of 51%. Capital ratio would also stand out with a CET1 ratio of approximately 15.3% versus a peer average of 14.9%. Similarly, both LCR and SFR ratios of the combined group will stand at among the best levels in the Italian banking sector. All in all, in 2027, we expect the combined entity to generate revenues of above EUR 7 billion as the result of higher productivity, cross-selling, and higher shares of wallet. Thanks to a larger scale operating efficiencies and investments in technology, we estimate a profound reduction in the cost income ratio landing at approximately 46%. Resulting operating income pre-provision is those estimated at EUR 4 billion compared to EUR 2.7 billion of BPER standalone. Thanks to the business combination, the expected results on the bottom line will boost the net income generation comfortably above EUR 2 billion, including synergies, in 2027, up by more than 40% compared to BPER's business plan. This result would position the new group among the top tier in terms of profitability, with a return on equity of approximately 15% and a very solid capital position above 15%, which provides a comfortable excess capital buffer versus the 14.5% CET1 target of the business plan. All this being said, the level of shareholders' remuneration will stand at an average 75% dividend payout. This is an important feature of the proposed business combination for all shareholders, in particular for those of Banca Popolare di Sondrio. Let's move to the overview of the proposed transaction. The business combination is subject to a successful voluntary public exchange offer on all ordinary shares of Banca Popolare di Sondrio. The exchange ratio has been set at 1.45, equivalent to 29 newly issued shares of BPER for 20 existing shares of Banca Popolare di Sondrio. Based on the official price of the shares of BPER and Banca Popolare di Sondrio recorded on Wednesday, this exchange ratio implies an offer price of €9.527 per share and a premium of approximately 6.6% versus Wednesday closing price and 10.3% versus the last three months' weighted average price. We are convinced that the offer is extremely attractive for Banca Popolare di Sondrio shareholders. The closing of the transaction is conditional upon a number of items. That said allowed me to underline that we aim at the full integration of the two groups. The proposed transaction is based on a condition of effectiveness, which includes inter alia, reaching a stake equal to at least 50% plus one share of Banca Popolare di Sondrio share capital. In any case, BPER reserves the right to waive the 50% plus one threshold, as reaching the acceptance rate of at least 35% plus one share of Banca Popolare di Sondrio will result in a dominant influence. Banca Popolare di Sondrio not adopting any defensive measures or measures inconsistent with the objectives of the offer. The offer will be subject to customary green lights, such as supervisors, antitrust clearance, etc. Key dates to bear in mind are: 18 April 2025, EGM to mandate the board of directors to issue new ordinary shares to be exchanged in the context of the offer. June-July 2025 offer period. By 2025 year-end, closing and merger of Banca Popolare di Sondrio into BPER. In conclusion, we are very excited about this business combination driven by a strong industrial rationale. This is a crucial moment in the Italian banking system. I'm convinced that we need to protect and defend our territories with business combinations involving banks with similar values, cultures, and DNA. This is a unique opportunity to create a leading banking group with a focused presence in the richest regions of Italy. The strategic rationale is compelling. There is no doubt that the business combination will be a unique and financially strong bank to support Italian families, SMEs, corporates, and local communities, placing the clients of both banks at the center of our offer and supporting them in a long-term sustainable manner. From a synergy perspective, the rationale is strong. There is a substantial value creation for all shareholders stemming from approximately €290 million of revenues and cost synergies, and we believe there is scope to do even better once the full integration of the two banks is achieved. Financially, the transaction is expected to be mid-single digit creative on EPS, including run rate synergies based on consensus estimates, with an expected net income of more than €2 billion, including synergies, in 2027, and a return on tangible equity of approximately 15%. Most importantly, the new banking group will be characterized by a very high asset quality and a very robust CET1 ratio. And last but not least, organic internal capital generation will ensure an important shareholder remuneration targeting an average payout ratio of 75% while maintaining a solid CET1 ratio well above the 14.5% target of B-Dynamic Full Value 2027. This is an important benefit of the proposed business combination to all shareholders, in particular for those of Banca Popolare di Sondrio. In addition to the premium, Banca Popolare di Sondrio shareholders will benefit from BPER's superior stock liquidity while participating in an excellence-driven project of value creation. Thank you very much, and I will now take your questions. Thank you. 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 under Touch-Tone 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 Marco Nicolai, Jefferies. Please go ahead. Hi. Thanks for taking my questions. I've got two on the transaction. So I understand the strategic rationale, what I'm not totally sold on is the EPS accretion. Could you give us some more color on this? Because given the relative valuation, it's not easy to have accretion on my numbers. So if you can add some color on this front and also on the timing, maybe on this accretion. And given that you will land at 15% plus in terms of Common Equity Tier 1, why didn't you decide to structure the deal from day one with more, let's say, mix between cash and shares that could have been more accretive in terms of EPS, especially considering that you will still land at 15% plus in terms of Common Equity Tier 1 ratio? And the second question is on the acceptance threshold. So usually in these deals, the target is two-thirds of the shares, and then the minimum level is usually 50% plus one. So why have you decided to lower this threshold to 50% and 35% plus one, respectively? What is the rationale? And do you think there is the risk that maybe Consob or regulators could ask you at least 50% plus one? Thank you. Thank you for the questions. I answer first your second question, and then I move to the first one. So let's say that our ultimate objective is to fully integrate the two banks to create a stronger and more resilient group and generate value for all the stakeholders. And given the shareholder structure of Banca Popolare di Sondrio, this can be achieved according to the plan of reaching 50% plus one shares taken in the bank. The 35% plus one share acceptance ratio refers to the minimum stake, which would still allow BPER to control Sondrio and fully consolidate the bank in the BPER banking group, taking into account the usual attendance rate at the AGM of the bank. Inasmuch as the EPS accretion is concerned, we expect the transaction to be mid-single digit accretive on EPS, including run rate synergies, and we have calculated this for consistency on 2025 and 2026 consensus estimates for both the two banks, so both BPER and Sondrio, which, as you know, has not recently published any business plan targets. Now, you have also to consider that inasmuch as the consensus for Sondrio is concerned, 2027 is not reliable, as there are only two research analysts that are providing estimates. Therefore, we believe that by applying a reasonable evolution on Sondrio for 2027, the expected EPS accretion will be broadly in line with the one of 2025 and 2026 period. Then there was the other question about the, sorry, the part in cash and part in shares. So the transaction, as we mentioned very clearly, has a highly industrial rationale. So that both shareholders of the two banks will participate to the value creation of this transaction of the combination of the two banks. And this is the reason why we decided to go only for shares swap. Thanks. Thank you. The next question is from Adele Palama, UBS. Please go ahead. Yes, hi. Good morning. A couple of questions on the deal and then on the results. So on the deal, do you have, or Sondrio has, any DTA of balance sheet that you can recover? And then are you assuming any value adjustments in your capital impact? And then still on the capital, what's the Basel IV impact that you are expecting for BPER? And if you have already an estimate of the combined Basel IV impact for BPER plus Sondrio? And then still on the deal, have you had any contact with the board of Sondrio? I mean, did you have any informal contact with them? Can we consider this like a friendly deal? And then on the results for BPER, so I understood that the guidance for the NII in 2025 is in line with 2023. I was wondering if you can give us a guidance also on 2026, and then the expected contribution of the hedging structure embedded in the guidance, and then the strategy on the financial asset, on the Govies in particular, given that you had an increase quarter on quarter. Thanks. Thank you very much. For the questions, the first question about DTAs, we do not have any off-balance-sheet DTAs as BPER is concerned. And we understand that there is a similar situation in Sondrio, but we don't have access, we didn't have access yet to the financials of Sondrio, but we believe that this should be the situation. Inasmuch as it is a four-impact combined, we do have the impact for BPER. And if you like, I can pass to our CRO. We don't have, obviously, the potential impact of Basel IV for Sondrio because we don't have yet access to the numbers of the transaction. I'll let maybe our CRO, Mr. Cristini, to answer about BPER. Yes. Yes. Thank you for the question. We can confirm that the impact coming from the new Basel IV framework for BPER is of around 70 basis points, and this impact is fully including the projection we have prepared for the deal. Okay. Then inasmuch as the third question is concerned, the deal was not agreed upon, but let me state also that we don't consider this deal, this offer as a hostile one for the rationale that we mentioned during the presentation. In as much as guidance for '26, we don't have, for the time being, any guidance, given also the current situation of interest rates would be a little bit strange to give guidance for 2026. Thank you. For the strategy of Govies, maybe I'll put through our CFO. Yes. Thank you very much, Mr. Papa. We have, as you correctly noticed, we have increased the level of the Govies. Let's say that this is very, let me say, for us, comfortable level. We don't think to move so much compared to the level that we have now. Okay. Thank you. And sorry, on the fair value adjustment related to the deal, do you have an estimate on what that could be? No. We think that fair value adjustment is aligned to the book value. So therefore, we don't have any significant impact on that. Okay. Thanks. The next question is from Andrea Lizzi, Equita. Please go ahead. Hi. Thank you for taking my question. I have two on the deal and other two related on the results of the fourth quarter. In particular, as regarding the deal, you said that the estimates of synergies have been defined in a conservative way. Just to understand better, if you can provide a bit more color on this conservative way, so where do you feel to have most of the margins there? And then what do you think will be the main challenges related to the integration and the main elements of attractiveness of the business combination? In particular, we know that Banca Popolare di Sondrio has a business model that is where the NII component is relevant, more relevant than for you related to the mix of NII and FIS. So how do you plan to rebalance this in the combined entity? The question regarding the P&L of the fourth quarter are, first of all, if you can explain better the dynamic of DNA, which were significantly up. Are there some one-off elements? And similarly, if you can explain me the impact of those EUR 118 million of losses on investment in the fourth quarter, are these one-offs as well? Thank you. Thank you for the question, Andrea. So in terms of synergies, we mentioned that you are expecting conservatively synergies for EUR 290 million, of which EUR 100 million coming from revenue synergies and EUR 190 million coming from cost synergies. So if we dwell into that, cost synergies comes from personnel cost synergies. So this will come from FTE optimization that will be carried out, leveraging on voluntary exit, as well as natural workforce turnover of both entities. 60% will come from admin cost synergies, of which 50% from IT savings, we believe, 20% from branch optimization, and 30% from other admin costs. Inasmuch as revenue synergies is concerned, and this is where we believe that we'll be able also to extract more synergies, we expect to align the combined entity to the best practice of BPER. Based on our internal analysis, we see a higher distribution network efficiency for BPER in the same geographical areas where also Popolare di Sondrio operates. On top of that, we believe that also the fact that we are sharing same product factories with Sondrio will allow the combined entity to operate in a more efficient and productive way, leveraging on large distribution capabilities and implementing best practice of the two banks. As you know, our approach is always a conservative approach. Also in this case, we estimated overall EUR 290 million, but going forward, we believe that we'll be able to extract more synergies. And as a matter of fact, if you take the last transaction we did, which is the Carige integration, we were able to be much faster in exploiting synergies, and we were able also to extract more synergies than what we had foreseen, both on the cost as well as on the revenue side. Inasmuch as the impact of DNA and the losses of investments, I'll put you through Simone Marcucci, our CFO. Thank you very much, Mr. Papa. In relation to the DNA, as you know, as we have written, we stated during the plan, we have EUR 650 million of investment in IT, and this is what we are doing now. Therefore, the increase in the DNA is related to the software. As we have written in the presentation, we have also taken the opportunity to make a one-off write-off of old IT system for EUR 35 million, as is written in the first pages of the presentation. In relation to the EUR 818 million of loss in investment, we have taken the opportunity to write off one-off the EUR 64 million of one participation that we have inherited from Carige, that is Autostrade of the flower, Autostrade dei Fiori, that we have done EUR 64 million one-off write-off. So we remain with EUR 50 million for this participation. We think that this is a fair value. Then we have written off EUR 30 million of real estate, not instrumental. And then we have written off some additional goodwill of participation, bringing this goodwill at zero. Very clear. Thank you. The next question is from Giovanni Razzoli, Deutsche Bank. Please go ahead. Good morning to everybody. I have three questions, actually two. One is a clarification. Regarding the target for net income in 2027 of 2 billion EUR, I struggle, honestly, to reconcile with this figure, and I'm wondering why you took the 2027 consensus estimate, which if I look on Bloomberg, it's significantly below your standalone target of 1.5 billion EUR. It seems to me that consensus for 2027 is more in the region of 1,350 million EUR, so if I remove also the net synergies in 2027, I end up with a contribution of Popolare di Sondrio that is implicitly quite below 2027 consensus, so what is the potential run rate that the bank has shown in the Q4, so it seems to me that the 2 billion EUR of net income in 2027, if I add all these moving parts, could be much higher. Is my understanding correct, and why have you decided not to incorporate your standalone target of the business plan and instead you have took the consensus for 2027? Second question, can you share with us what would be the CET1 ratio of the combined entity in case that the acceptance to the offer would be, say, I don't know, 51%, so the minimum level to have the control of the annual general meeting, or even the 35%, your minimum threshold? And the clarification, do you confirm the interim dividend payment for 2025 in November? Thank you. So thank you for the question. Giovanni, I give the part of the first and then second and third, and then I'll put through Simone for the remaining part of the first question. As we mentioned, we, in terms of 27 targets, we took the consensus. The consensus is what it is, so we choose to go in this direction. As we mentioned, in terms of consensus for Sondrio, there are only two analysts that look at, and you are one of the two, basically. So this is, and then there is another one, which has a consensus that is much higher. We stayed in the middle. So we decided to take this. As I mentioned, and as you know, we are very conservative in our approach. We said that most probably 2027 will be north of EUR 2 billion, but we prefer to be conservative under this point of view. Maybe for more color, I'll put through Simone. Yes. Thank you very much. In relation to the EUR 2 billion, so as you know, we have described in the plan what is our target for the plan. So we have taken this target for us that is around EUR 1.5 billion. There is the consensus we have taken of the average of the two banks that provide the consensus that for us is around EUR 400 million for Banca Popolare di Sondrio, and then we have put the EUR 200 million synergy. So the result is above EUR 2 billion. I understand the topic is, let me say, very detailed, so I would suggest then to have, let me say, a separate call with Nicola and myself. We have always taken, in any case, consensus versus consensus because we, as explained before by Mr. Papa, we don't have the target plan for Sondrio. So then inasmuch as the CET1 of the combined entity, we run an exercise. I can give you, for instance, the potential impact in the scenario of a 35% plus one share stake acquisition. So in 2025, we would have a combined entity pro forma pre-dividend of 15.7%, and this will allow us, will create an excess capital CET1 capital versus 14% CET1 capital ratio, which will allow for a potential available dividend of EUR 1.1 billion. For 50% plus one, we didn't run the 25, but we believe will be higher than what I mentioned for 35 because I said the 35 plus one is, let's say, the worst-case scenario that we would have in terms of impact on capital. In terms of 25, interim, yes. So as you know, we got the approval for the possibility of distributing an interim dividend. Dividend always is because we amended our bylaws and introduced the interim dividend starting from this year. As you know, dividend payment is a function of capital generation, and the business combination will provide for sustainable and healthy capital generation in the next years. So our objective is to pay interim dividend as planned, and the business combination, as we mentioned also, will not affect our payout ratio of 75%. Thank you. Thank you for the clarification. So for 2027, you are assuming your business plan target net profit of EUR 1.5 billion, right? For BPER. Standalone. Standalone, this was a conservative approach for our plan. You have seen that today we have done EUR 1.4 billion. That is better what we have provided at the beginning. Okay. Thank you. The next question is from Domenico Santoro, HSBC. Please go ahead. Yes. Hi. Good morning. Thanks for the presentation and all the details. I understand the confusion about the accretion. Even if I do that calculation based on 2025, 2026, at best, I get neutrality on EPS. I will suggest maybe later to send some more clarification about the calculation and probably a more realistic net profit about Sondrio, which we don't cover. It's quite under-covered. Basically, it gives a better idea about the profitability of the bank. Having said that, thanks for clarifying the impact on the capital in the case of a 35% tender of the shares. My question now is more about the level of capital per se. The other things are clear to me. But I mean, you're running with a very high level of capital, even in the situation where you don't get full control of the bank. I mean, to give a sense, Sabadell this morning basically announced a shareholder's remuneration of what is in excess of 13%, and I don't see why your risk profile is worse than Sabadell or other banks in Europe. So I understand that your shareholder structure is particular, let's say it this way. But I just wonder whether, on top of the 75% payout ratio, you might start to consider a more generous shareholder's remuneration or even a share buyback going forward that probably will also neutralize a little bit the maybe the EPS neutrality that I think I calculate correctly. Thank you very much. Thank you, Domenico, for the question. So yes, we will have a very comfortable CET1 ratio. As you know, we always prefer to be safe than sorry. Let's put it in this way. You have also to understand that it is impossible and not plausible to go to the regulators and ask for running a bank with a 13% CET1 ratio. Let's say that the minimum usually is around 14, 14 and a half. Inasmuch as the payout ratio, let's see what the combination. Obviously, if we have a better performance than what we expect in terms of net profit, in terms of higher synergies, both on cost and revenues, definitely we will have the possibility maybe to pay more. We are open to this. You saw already that for this year, we are proposing an increase of more than 100% compared to last year. There is room to pay more. We pay EUR 0.60, which is equal to 61%. Last year, we paid 30%. You see that we want to remunerate our shareholders. In terms of buyback, consistent with our standalone business plan, as you know, we have decided to focus more on regular cash dividend distribution rather than share buyback because we believe that ordinary dividend is the most sustainable way to remunerate our shareholders. And as such, we do not envisage to carry out any share buyback after the business combination, but we will remain committed to the generous distribution policy with a 75% payout ratio average, open, obviously, in case of better results than expected, to increase also the 75%. Can I just follow up on this very quickly? Sorry. Please finish. Yes, yes. Please finish. Maybe I follow up. No, no. I was saying that then following your suggestion, there will be a meeting with Simone and Nicola for more details about EPS accretion. Thank you very much. This is very useful. Just on the point of the regulator, I mean, you said basically that you can basically go further down compared to the 14% or 14.5% that you mentioned before. What's the point for the regulator? I mean, for a bank like you that has a solid balance sheet, a very good profitability, a business mix which is huge towards asset management, to ask this sort of top-up on capital, just to clarify compared to the other banks that we see in Europe, is it sovereign? Is it something else? Because I think it's a pertinent question. No, I don't think that the regulators are asking officially this, but you should ask this question to the regulators, not to me. So if I could operate with 13%, I would do it. But we do understand that there is a sort of also, as I can say, of attention paid by the regulators to have solid banks with solid capital ratios. In any case, capital is needed if you want to grow. Assuming we go through and we are able to finalize this business combination, this will not be the end in the sense that we see a further growth of the new entity that will be created by putting together the two banks. We mentioned increase in share of wallet, which is also what we are pursuing as BPER. So we do need capital for this. So as I mentioned, 15.7% is in the worst-case scenario pre-dividend. As I said, in case of the 35% plus one share, we will have space for up to EUR 1.1 billion dividend, which means we'll bring down our CET1 ratio at around 14%. So I'm answering already your question. From 15.7% pre-dividend, if we decided to pay EUR 1.1 million, we'll go down to slightly above 14%. So we will go back to a more palatable CET1 ratio. Let's put it in this way. But this 1.1 is an extraordinary dividend? This is what you're mentioning? No. On top of the ordinary? So you're talking ordinary then? No. Ordinary because I'm saying that in the worst-case scenario in 2025. Pre-dividend. I understand. I understand. Pre-dividend, the combined entity pro forma will be at 15.7%. And this will allow us to pay. There will be EUR 1.1 billion available for dividend, which will bring capital to around slightly over 14%. So that means that paying ordinary 75% in a situation where you get the 13.5%, the pro forma capital will go to 14%. That's basically the answer to the colleague before then. Roughly, yes. All right. Okay. That's clear. Thank you. Thank you. Thank you very much for the patience. Thanks. No, no, no. It's okay. The next question is from Ignacio Ulargui, BNP Paribas. Please go ahead. Thanks for the presentation. I have two questions. One on cost synergies. If I just look to the 190 million EUR, they look to me relatively low in the context of other deals that we have seen. I mean, I just wanted to see whether that conservatism that you have mentioned across the call several times is more there or you think that it's more in terms of revenue where you see more upside on the cross-selling with Sondrio. The second question is whether you are considering any kind of revenue deal synergies at the beginning of the transaction, given the fact that throughout the process of the integration, it's normal that you lose some revenues. And then one question on the results today. I mean, loan book and deposit performance was very strong. I mean, could you elaborate a bit on what should we expect for 2025 on that guidance of NII provided and what was the main performance of deposit gathering in the quarter? Thank you. Well, thank you for the question, Ignacio. So let's talk about synergies first. We are rather conservative in terms of indicating the synergies. We basically work on an assumption of, in case of a base-case scenario, synergies equal to 32% of the cost of the target. Okay? So we do understand that in other transactions, we had much higher synergies that were exploited. But here, we want to stay, as I said, conservative. When we acquired Carige, we were able to extract more synergies than that. But that was a bank that we knew better because we were sitting in the board and we were seeing. Now, we don't know exactly what it is. So better to be, as I said, safe than sorry and stay on the lower side. But let's say that we do believe that we'll be able to extract more synergies both on the cost side and on the revenue side. And on the revenue side, as what I mentioned before, I think our commercial activity is much stronger than the one of Sondrio. So it's a matter of we want to align the commercial activity and the commercial dynamics to the one that we have in BPER. You saw the results, for instance, in terms of commission that we have produced, commission income in 2024. We had a huge increase in terms of bank assurance, in terms of wealth management. So we think that we'll be able to extract even more synergies on the revenue side. So on both sides, we believe that we'll be able to consider that on average, on the revenue side, we have synergies that run at an average of 8% average. We calculated synergies at 7%. So just to show that we are conservative in this. But there is an upside. In terms of loan book, we ended the year 2024 with a growth of 2.2%, which is a very good growth considering that the system in Italy went down in terms of all loans in 2024. But this comes from the very strong commercial activity of our workforce. We promised this, and it's part of our business plan of the three-year plan that we presented in October. For 2025, we are foreseeing a growth of 3-3.5%, coming 60% from retail, 40% from corporate. For 2025, the guidance is for further growth in terms of loans. Thank you very much. The next question is from Ben Mathews with KBW. Please go ahead. Hi. Thank you for taking my question. I just had two on the results, actually. I just wanted a bit more color on the 17 basis point positive impact in capital this quarter. I saw you noted the operational risks you booked in the quarter, which I think was slightly lower than previous guidance. Did you expect any more up risk? And then my second question is on the interest rate sensitivity. Thank you for the sensitivity to a parallel shift. I was wondering if you had any comments about your sensitivity to a slightly upward-sloping yield curve, given that's kind of what the market's currently indicating. Thank you. Thank you for the question. I'll put you through, Mr. Cristini, our CRO. Thank you. Thank you for the question. With regard to the baseline for impact, we confirmed that the fully phased impact will be over around 70 basis points. With regard to the evolution of our RWA as of the end of 2024, the main impact is related to the annual update of the operational risk, and the impact has been around EUR 1.1 billion in the fourth quarter of 2024. An additional impact is included in the new baseline for framework that will be introduced starting from the first quarter 2025. As highlighted in the presentation, the NII sensitivity with regard to in case of a decrease of 100 basis points is of around EUR 165 million. The next question is from Luis Pratas, Autonomous Research. Please go ahead. Thank you for taking my questions. My first one is, so given the common shareholders and the several partnerships between both banks, I thought it could make a lot of sense to pre-agree the terms with Sondrio's board of directors if you basically could give any color on the logic behind doing this offer directly to the market and not trying to find a sort of agreement. My second question is also about why are you actually doing this offer now? You have said in the past that you were focused on your business plan execution, and there is a gap between consensus and the 2027 net profit guidance standalone. Additionally, there is also the multiple difference with Sondrio having a rich multiple in the market above yours, so I wanted to understand why now, and my last question is a follow-up on the NII 2025 NII outlook. If you could please share the rest of the assumptions, for instance, rates, also your commercial rates assumption. And that's it. Thank you very much. Yes. Thank you for the question. Well, obviously, if we went this way, it's because there was no other way we could go. So we decided to launch an offer because there was no possibility of reaching an agreement and having an agreed deal with the other bank. Otherwise, you would have done it. It would have been simpler, but unfortunately, we didn't see this possibility. So we had to go with this offer. In terms of why now, why now is because, yes, I always mentioned that we presented the plan was for standalone growth, and in fact, we are growing. If you look at the results of 2024, we grew very nicely in terms of volumes, in terms of commission income, in terms of NII, and so on and so forth. We grew also in terms of number of new customers, net new customers that we had. On the other hand, we had witnessed in the last two months of this year, I mean, the last year and the beginning of this year, an array of proposed transactions, which is changing the parameters of our activity in Italy. We had to protect our positioning. So that's why we decided to go now because we want to create a stronger group, putting together two banks that, as I mentioned during my presentation, have the same DNA coming from the Banca Popolari group, which have, there's no overlapping in branches, have similar attitude toward customers. So, the reason, but let's say the reason that really pushed us to move now is because we saw all these transactions coming, which will create stronger banks. And so we had to make a move, basically. Your last question, I don't. About the net interest. Net interest income, I'll put you through Simone Marcucci. Yes. Thank you very much, Mr. Papa. As Mr. Papa has mentioned before, for net interest income, we think to be conservative in line with 2023. As also mentioned, the loans went very well. We are high-end. We finished 2024, as you can see, high-end of the plan. And it's also from quality. We had a lot of growth in mortgages. This gave us, also, let's say, our natural hedging on our balance sheet. Therefore, we think to have the first year of the plan, 2025, better than expected. Then, it will depend clearly on the rates. For sure, the interest income will decrease due to the rates, but not at the level that we expected before, at least for the time being. Then let's see the rates. Thank you. I just have a quick follow-up. Regarding the first answer, could you please confirm you tried to approach the Sondrio Board of Directors for a friendly deal? No. Well, yes, for sure. Yesterday, we informed the CEO of the bank that we were moving in this direction. As I mentioned, it's not an agreed offer. It's not an agreed transaction, but we do not consider this a hostile one because of the reason that I mentioned during my presentation. I think the two banks share the same DNA, no overlapping, perfect fit in terms of customers or geographical presence, and so on and so forth. So let's see what the reaction of the board of the other bank will be. Thank you very much. As a reminder, if you wish to register for a question, please press star and one on your telephone. The next question is a follow-up from Adele Palama, UBS. Please go ahead. Yes. Hi. Sorry, I had another question. On cost of risk, can you repeat the guidance for 2025? I understood it was slightly higher than 2024 for BP standalone. And then are you expecting any possible additional disposal of NPE as a result of the possible combination with Sondrio? Thanks. So guidance is to have in 2025 a slightly higher cost of risk compared to 2024. We don't have numbers yet. It will be slightly higher, but we reached 36 basis points, which is a rather low cost of risk. So again, conservative assumption. In terms of asset disposal, we do have in terms of activity of disposing assets as BPER. We are doing it on a yearly basis. Obviously, we can't now mention anything about Sondrio because we didn't have access to their numbers. And therefore, we saw the results they presented yesterday, where they have a very positive gross NP ratio, which improved to 2.9% with a net of 1.1%, which is equal to our net. We have a gross of 2.4%. So we are slightly better, but too early to say. Thanks. Once again, if you wish to ask a question, please press star and one on your telephone. Gentlemen, Mr. Papa, there are no more questions registered at this time. I turn the conference back to you for any closing remarks. Okay. I want to thank everybody. So as we mentioned, there will be a follow-up with our CFO and with Nicola Sponghi for delivering more specific numbers to answer your more specific questions. Thank you very much for being here today. Thanks. Ladies and gentlemen, thank you for joining. The conference is now over, and you may disconnect your telephone.