Thank you for standing by. Welcome to Mediobanca's considerations on the public exchange offer promoted by MPS conference call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. To enter the queue for questions, please press star one, one at any time. You will then hear an automated message advising that your hand is raised. To whisper your question, please press star one, and one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Mr. Alberto Nagel, CEO. Please go ahead, sir. Good afternoon to everybody, and thank you for joining the call. As you know, last Friday, our board has published the issue statement regarding the exchange offer of Monte dei Paschi. This presentation summarizes the views of the board and gives more color also with the Q&A session on what the board has said last week. Mediobanca, in the last decade, has constantly delivered on its strategy and targets. The extension of our plan, which we have approved at the end of June to 2028, is coherent. Continuation of a long-term value-driven journey set to deliver further growth in revenue, profitability, and shareholder remuneration. We have indicated up to EUR 5 billion of distribution in three years, cash distribution. Banca Generali transaction is the strongest accelerator able to deliver superior value to our shareholder. On the other hand, we have to look at the offer of Monte dei Paschi, and when looking at Monte dei Paschi as the offer is all shares, we need also to address MPS key risk areas. We know that Monte dei Paschi has a long history. Unfortunately, the last part of its history was a troubled one, with EUR 25 billion of capital increase in the last 20 years, a big erosion in market share, and diluted business model. The recent performance has been driven by NII trend, which doubled in the last three years, driven by high interest rates and also benefiting from tax benefits. Significant risks remain, including asset quality, low RWA density, and vulnerability to macro and legal risk. We think that the offer is marked by lack of strategic and financial rationale. The business model deriving from the combination is an undifferentiated one of a mid-sized commercial bank with low growth potential, which is diluting Mediobanca brand reputation and franchise, and does not bring any improvement in offering to our customers. If we look at consensus-based 2028 of the combined entity PBT, it is resulting in a combined growth of EUR 350 million. Out of these 350, 85% is stemming from Mediobanca standalone growth. Combined entity is set to destroy value through these synergies. We think that we can have EUR 460 million of negative PBT impact, which can go up to EUR 675 million in case of lack of merger. Additionally, there is no DTA benefit if the acceptance is below 50%. And MREL deficit in case of no merger. We know that Monte Paschi has set a minimum threshold of 35%. There is also a theme on governance as the governance. Deriving stemming from the combination is quite complex through a pyramid structure with the same shareholders having a significant presence in the three systemic financial institutions. Which is even more important is that the consideration is totally inadequate from a financial standpoint. We have estimated that we will have a 10% recurring earnings dilution based on PBT contribution and expected synergies, and we will have the same impact of minus 10% in DPS. The proforma business mix will be more skewed towards commercial banking, of course trading at a lower multiple compared to our bank and in general wealth management player. At the proposed exchange ratio 2.533, Mediobanca shareholder will be exposed to more than 60% of the risk and the synergies resulting from the combination, assuming, of course, 100% of acceptance. The proposed exchange ratio represents a 32% discount. Vis-à-vis the average of ranges identified by our board supported by the financial advisor, which is EUR 3.71. The offer is unattractive and the consideration is financially inadequate. The story of Mediobanca, all of you know quite well, is a story of growth in wealth management set as a priority. Now it is a player which is distinguishing wealth management in terms of above market average growth due to a synergic approach with CIB, which is then making that our process of attracting bankers and high net worth clients is faster than the market. Now with the perspective of combining with Banca Generali, we will double our size and Mediobanca post Banca Generali will be more and more seen as a wealth manager. CIB has delivered some of the best profitability in the European sector thanks to a profound reshaping, which acts onto different use RWA. More advisory, and more international income. Compass is delivering very good and improving results quarter on quarter, and I think is the most profitable consumer finance company in the Italian market. This is given as an NII engine, which is going to be very important in the next few years when interest rates are set to become less supportive for the NII. The stake in Generali is on one end a source of high income and dividends, and on the other is, as we said always, a capital reallocation opportunity, which recently materialized in the offer of Banca Generali. If you look at slide six, this is a slide that we have already commented on in the last call. We have had a coherent and stable strategy consistently over delivering on targets. Whether we operated with low interest rates, zero interest rates, negative interest rates, or higher interest rates, we managed to increase every single plan substantially. Revenue, EPS, ROTI, and CET1 have been always very high. Letting important distribution and growing distribution to be done. As I said in the last round, we plan to distribute EUR 5 billion. I think. More and more convinced in the year to come, already now, will be important to be on a business model which is differentiating. Bank versus the sector in the sense that the sector of commercial banking will be more and more attacked by newcomer. The Revolut, the Klarna. It will be more and more important to be on value-added service, on. Credit, which is going to be less obvious to be given to customers like what we do in e Compass, in advising clients in corporate investment banking, or in giving protection and good advice in managing money in wealth management. Today, we have a good set of different businesses that are decorrelated. We have an important engine in NII in e Compass, as I said, but we have a growing engine in fee, which is driven by wealth management and CIB, thanks to private investment banking model. This is very important to be safeguarded, to be further fostered with the Banca Generali offer, because, as I said, I do believe that margins in commercial banking, in general banking, but more and more in commoditized simple service with low value-added will be under big pressure. If we look at our long-term value journey, it's a journey which is built on. A reshape and growth of the bank. Since 2016, we have doubled our revenue, but which is even more important, it's the composition of this revenue. We were having in 2016 only 15% of the revenue stemming from wealth management. Today, we have roughly 30%. We plan to increase our revenue by 20%, so it is 6% per year CAGR up until 2028. This is also bringing a different distribution to shareholders. Up until 2025, we have had a mix of buybacks and dividend, 100% payout, but with 70% cash. We moved this percentage to 100%, with an expected increase in DPS, which is going to go from EUR 1.12 per share to EUR 2.1 per share in 2028. Doubling the cash dividend to our shareholder and going to have a cash order payout at 100%. We will have still the last part of buyback, which is the last part of the plan, EUR 400 million, which will be resolved upon in July. This kind of remuneration sets Mediobanca among the best standard of the industry. If we look at cash dividend or cash distribution on market cap, we will have 30% market cap in terms of distribution in the next three years. We will have 100% cash out, and we will be among the best bank in terms of capital generation. When we look at the perspective of combining with Monte dei Paschi, we need to look at their strength and their weakness. As I said, the last few years of Monte dei Paschi has been marred by a number of accidents, which basically brought the need of over EUR 25 billion of capital increase in the last 20 years, most of them in various state aids. Market share has dropped because the bank has shrunk because of the need of restructure and had to sell all the product factory because of capital constraint. Then becoming a majority distribution network. The recent MPS performance, positive performance, are mostly driven by higher interest rates, which doubled in the last three years. As we know, in the next few years, NII will be under more pressure, while the fee component has been always modest, sustained by large upfront part. P&L is impacted by significant tax benefit, with positive income taxes increasing MPS net earnings. Asset quality remains a concern because MP ratio and average PD is almost double versus peer. Lower RWA density relative to peers despite poor historical asset quality. We observed a higher CDS spread and NII sensitivity versus peer, and we still have some important legal risk, which equates to 35% of CET1, which is something that, of course, our shareholder never experienced with Mediobanca history. Lately. Lastly, but not the less important, is that because of this element, there is a limited visibility on future profitability and distribution capacity. Why? Because there is a high earnings dispersion among the different broker estimates driven by lack of visibility on tax benefit impact on P&L. And most of equity brokers, they forecast a declining ROTI based on consensus, as I said, potentially impacting future dividend capacity. If we go on page 15, we see that basically 10 years ago market shares of Monte dei Paschi in loan to deposit were 7% and 6%. Today it's 5% and 4%, so a material decrease in market share. They had to sell all the product factories. Asset management was sold to Anima. The life, the banc assurance, was given to AXA. Consumit, which was an internal company operating for the group, is now also in part substituted by the distribution agreement with Compass. Also, in payments, they made an agreement with Nexi. The bank had to do this for capital constraint, but this clearly had an important impact on the fee generation capacity, which was and is quite limited. As we said, the recent performance, like many commercial banks, was driven by NII. Sudden increase in Southern Europe. As we all know, in particular for commercial banking, we have seen a boost in NII because of the difference of cost of funding vis-à-vis the yield on assets. Here we see the evolution of revenue. Revenue basically compared, while in Mediobanca you see a constant increase in revenue over the different plan. Here we had in 2015, EUR 5.2 billion of revenue, which went down to roughly less than EUR 3 billion and then came up to EUR 4 billion because of NII. If you look at net fees and commission, this part never played the biggest role in the P&L. In the P&L of Monte dei Paschi, we should also consider, as we said, income tax. Income tax is, contrarian to every bank, a positive item in the P&L, and it is supporting heavily the profitability. Of course, in the years to come, this is going to fade away, and we need to look at the recurrent profitability when an ordinary tax rate is going to be applied. The asset quality of Monte dei Paschi as of today, it is worse than the peers. If we look at the probability of default. Based on company public information, we see that on average, as a material higher probability of default in every single category, SMEs, mortgage, large corporate, and retail mortgages, as well as basically the MP ratio, gross MP ratio stood at 4.4. The average of Italian banks is 2.5. Also the coverage of bad loan, it's different to 66% in Monte dei Paschi compared to 73% of average Italian banks. Another area of concern of attention is the RWA intensity or density. We see that Monte dei Paschi is enjoying a very low density, 47%, compared to average Italian banks. This is not explained by superior asset quality. On the contrary. We have seen that historically there's been a poor asset quality track record. They may still enjoy some waiver of the past. If we look at a simple. Assumption that would lead them to be at the same level of other banks, so having the same density, 54%. This will lead to 200 basis points of incremental need of capital. So material increase of capital need in case of alignment of RWA density to the other. We have observed also lower credit rating and high sensitivity to rates. This is adding further vulnerability to macro because the CDS of Monte dei Paschi is in the region of 120 basis points. This compares to 55 basis points of average Italian banks. Also the sensitivity to NII to interest rate volatility is higher with 11% volatility or sensitivity compared to 9% of average Italian banks. Legal risks are still sizable, 35% of CET1. As you may know, in Italy, legal proceedings are always very difficult to be assessed and are very long, having a very long tail. Recently, we have seen new legal initiatives going to some different stage of maturity. It is very difficult to understand if this amount set aside, which is EUR 500 million as opposed to EUR 3.5 billion, is enough or not. It is very difficult because of the complexity of the cases. What is not difficult to understand is the profitability in the sense that the consensus is showing higher dispersion of Monte dei Paschi earnings versus peer. We have 18% and 19% dispersion on 26% and 27%. For the average Italian banks, this is only 13%. It is difficult to understand the future profitability because of what I said before, in the sense that Monte dei Paschi is enjoying still some non-recurrent item like DTA. Hence, it is difficult to understand the recurrent profitability. If we look at the consensus, we see that the reported ROTI forecast is going to go from 18% this year to 11%. If we fully tax ROTI and we assume a fully taxed ROTI, which is basically having an average tax rate like all the other banks, this level of ROTI is going to go below, in the region of 9%, so basically well below cost of equity. This means that the bank is not generating value at this level of ROTI. We think that the transaction, the board thinks that the transaction weakens Mediobanca and the combined franchise. Why? In terms of business model, as we said, putting together Monte dei Paschi and Mediobanca is not going to improve neither Monte dei Paschi nor Mediobanca. Why? Because Monte dei Paschi weakness or Mediobanca weakness will not be helped combining the two. Monte dei Paschi weakness can be helped in merging Monte dei Paschi, combining dei Monte Paschi with another commercial bank with a complementary distribution network and also presence of useful product company. On the other hand, what we need is becoming stronger in wealth management is not something that Monte dei Paschi can bring to the table. There will be an impact on the brand, on the reputation, on the franchise. It is a capital-intensive model in the sense that basically it is not mainly fee-generating business, it is more NII-generating business, which is more geared to macro, which is reversing the trajectory we have pursued in the last few years. Financially, this combination will generate a substantial value destruction. We have estimated EUR 460 million of negative PBT impact. This equates in zeroing PBT growth, which we have forecasted in our plan. In other words, our plan to 2028. Foresees important growth in revenue and in profitability. As I said, 6% growth in revenue and mainly broadly the same 6%-7% in net earnings. In doing this transaction, it's like if we zero this growth and we are back to square one. Another element of concern is this. Less than 50% acceptance ratio because the bank has not set a customary level of minimum threshold. The customary level is 50%, where you have basically control of a company. In this event, no DTA benefit will materialize, very difficult implementation of synergies, and additional MREL deficit. We think that the other element is that we don't understand because it was not clear the governance post-deal. There were no details on the governance post-deal. We do see some complex governance through a pyramid structure. And minority shareholder holding may have a significant influence position on three systemic financial institutions. In other words, high level of execution integration risk. As we said, the combination introduced complexity to a path that Monte Paschi is having of fixing its weakness. The weaknesses are poor asset quality, ongoing litigation, business model highly exposed to interest rates, and a reputation which was marred by the previous problem. To this outstanding issue that the management is trying to cure over time with some success, we will add, or this transaction will add, additional issues, which are deposit outflow in private banking, client attrition in investment banking. This is also materializing into loss of top talent in private investment banking, and the synergies. The element of concern is that this transaction, because of the size of Monte Paschi, is making that it's a sort of reverse takeover. Mediobanca shareholder will have to bear 60% of the combined entity and hence 60%. At majority, the value destruction results from the combination. The combination, as we say on page 25, is not showing. A great player after because, as we said, it's not going to be a strong commercial bank, it's not going to be a strong wealth management. It's a bit of a mix of the two, which is not basically showing great appeal. On one end, we continue to look at our standalone plan. On page 26, we see that, as we said in the past, we never had some big issue that limits our growth. We were having EUR 2 billion of revenue in 2015. Now we are closer to EUR 4 billion, and we want to exceed EUR 4 billion in 2028. This is a 7% CAGR of revenue and 9% CAGR of net profit. If we look at the same period, Monte Paschi, negative CAGR in terms of revenue, and basically flat, it shows zero CAGR in revenue even for the future. In terms of net profit, it's difficult to understand because there have been a lot of, as I said, write-off and clean-up of the bank. Basically, only a few years they reported a net profit. We have a totally different view on synergies. In our case, we think that a nostalgic cover of two very different entities, one which basically acts on talent pool, is going to generate the synergies. It's going to generate roughly EUR 500 million of less revenue, only EUR 80 million of cost. Funding, which is going to be a net cost, a net incremental cost because of the different customer base. Our customer base is asking to be paid, while the customer base of Monte dei Paschi may be less rate-sensitive. We arrived to a total negative 460. With 275 integration cost, while Monte dei Paschi projection shows EUR 700 million of synergies and EUR 600 million of integration cost. This is going to generate double-digit PBT dilution and double-digit DPS dilution. How can we explain the synergies business by business? First of all, we need to take into consideration that we have updated our plan recently. As we said, the update shows important growth, in particular in Wealth Management and CIB. It is like if we say that basically this kind of, these synergies, which equates into EUR 275 million in Wealth Management and EUR 220 million in CIB, are for Wealth Management two-thirds stemming from less growth. Basically, we will grow less than what we have forecasted in the plan. The third, or 30%, is because of exit of assets and talent. This is for wealth management. In CIB, it is more balanced. So 50% is less growth compared to our plan, and 50% is exit of bankers and exit of clients. We see the phasing in three years in case of merger. Basically, 50% in ' 26, 75% in '27, and 100% in '28. If we look at how the synergies are reversing into the combined entity, we will see that, as we said, if we take into consideration the consensus, out of EUR 350 million of additional PBT in '28 of the two entities combined, 85% will stem from Mediobanca standalone PBT. This kind of growth will be totally erased by the run rate synergies. We see, as you can see here on slide 29, wealth management EUR 275 million, CIB EUR 220 million, and then the net of the other. Cost, 80 plus negative 45 in funding, 35 net, we arrive to. This 460, which is basically. Completely. Offsetting. The combined PBT growth. There is a matter of concern also on the governance of the entity post-deal. Why? Because basically. If we put together. The available information and we have two scenarios, merger, so basically Monte dei Paschi at two-thirds of Mediobanca and then. Basically doing a merger, basically we arrive to. The two main shareholders having a third of the combined entity and. Them plus this entity having basically 30% of Generali. If we look at a scenario, which was. Also the scenario that Monte dei Paschi set as a minimum threshold, this number changes because basically. The two main shareholders together may have more than 40%. And with. Monte dei Paschi not merging with Mediobanca, not combining with Mediobanca. We still have 30% of Generali. Having different interests and different positions, clearly, it's a matter of attention and possible concern. As we said, which is even more important, is that the implied offer value, implied in exchange ratio, is highly unattractive. Why? Because at current price, it's a 4% discount. When it was announced, it was having a 5% premium, which is not a premium of any kind of similar deal. If we look back at pre-announcement price, so we look at 3 months, 6 months, and 12 months, this equates into a severe discount, 3%, 13%, and 22%. As we said, Proforma Contribution 2028, Mediobanca shareholder will lose 10% of earnings because our standalone is going to deliver EUR 2.3 billion of PBT. While at the ratio offer, we'll have 62% of the combined entity, so only EUR 2 billion of PBT, so with a loss of more than 10%. Clearly, combining two businesses or putting together two businesses or two entities of this kind will not improve the multiple. At least will not improve the multiple for Mediobanca shareholder. Why? Because Mediobanca shareholders today enjoy a multiple of 10.4. This is also on the back of the efforts to invest more and more in fee and more and more in wealth management. As we know, NII or more asset-based commercial banks, they trade more in the category of 7-8. Basically, doing this, we will reverse our trajectory going back to a lower multiple. The board has set minimum value of the implied exchange ratio and a maximum value of the implied exchange ratio. The first one is 3.51, and the second is 3.91, so an average of 3.71. This equates or represents a 32% discount vis-à-vis the average of ranges identified. Hence, this is evidence that the consideration is totally inadequate. In summary, we said this already in previous calls. We see a very weak strategic rationale due to the absence of business model announcement for both entities. The combined entity risk profile will be weighted down not only by Monte dei Paschi risk profile, but also from the execution risk of the transaction and from unclear governance. Financial rationale is evanescent, as Monte dei Paschi has enjoyed for the time being a bonanza by interest rates and DTA. While we see in the future substantial synergies in the region of EUR 500 million PVT, negative PVT impact, as the consideration is entirely Mediobanca in Monte dei Paschi shares. We think that there is a steep discount vis-à-vis what is going to be a fair treatment of our shareholder, and also because of the deal mechanics, the deal mechanics and. The size of the two entities. As we said, this is a sort of reverse takeover where basically our shareholder will have 62% of the combined entity, so in theory, should express the control of the new entity, while the control of the new entity is supposed to go to Monte dei Paschi shareholder, which they have also set a minimum acceptance of 35%. We think that our strategy standalone is going to deliver a much better perspective to our shareholder. This is not because we are under an offer, but because this is coherent with what we have been consistently delivering in the last 10 years or 15 years. We are not now setting unreasonable or unachievable targets. We are setting targets that are coherent with our delivery and our story. 6% revenue CAGR and an EPS recurring plus 9. ROTI recurring at 17% with still an important CET1 of 14%. On top, we are very much focused on bank and JNI transaction, which represents a significant capital reallocation from insurance to wealth management. A stronger focus on faster-growing capital light wealth management business, which can create a clear leader in terms of quality, visibility, and revenue, and represents a unique equity story and a creative transaction which can unlock important synergies. We are looking to go ahead with this transaction as we are looking to go ahead with our industrial plan because we firmly believe that there is no match in terms of value creation and cash distribution to our shareholder compared to the offer that today is on the table. Thank you very much for your attention. Thank you. We will now begin the question and answer session. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. We will now take the first question from the line of Luigi De Bellis from Equita SIM. Please go ahead. Good afternoon. Thank you for taking my question too for me. The first one, so regarding the Monte Paschi transaction involving Mediobanca, could you share your view on how this offer compares to what is usually seen in the market standards or similar tiers? Which are the main parts that seem significantly different or unusual? If you could kindly share your view on those. The second question, huge amount of potential synergies. Could you please elaborate further on the revenue synergies by division, also in light of previous transactions in the market and considering your foreign boutique in the CIB? If you can elaborate on the MREL deficit in case of no merger at different RWA density of Monte Paschi compared to the banking system average. Thank you. Thank you, Luigi. Yes, I share the view that I am not alone, that this transaction is not customary, is not a standard transaction for many elements of anomalies, maybe too many. Let's go through them. The first is the way the last tranche of Monte dei Paschi share has been sold and the presence of our two main shareholders, which entered in Monte dei Paschi simultaneously in November. Let us understand or think that there should be a plan on Mediobanca when they enter because otherwise, there will not be any reasonable motivation to invest hundreds of millions of EUR in a bank when, at the time, they were already very much exposed to Italian financials. In order to invest additional money when you have already a big exposure, you should have a plan. The first element is this one. This is also basically confirmed by the fact that these shareholders increased their stake immediately after they were copied in the board of Monte dei Paschi. Monte dei Paschi, immediately after, announced the takeover of Mediobanca. In this perspective, it is not credible what the CEO of Monte dei Paschi is saying, that he did this transaction on his own, because basically what we have seen is that this transaction was prepared and voted and backed by all the major shareholders, even including the government. The third element of, I would say, anomaly is this structure of the transaction. The fact that it is not amicable or hostile is not one of a kind, because we have seen a lot of hostile takeovers. This is something that in the market is seen frequently. Having the same shareholder on one side and on the other, an offer without a premium, and the fact that the offer is much smaller than the target clearly generates a number of question marks. First of all, on the economic interest of these two main shareholders to pursue this transaction compared to the perspective of Mediobanca standalone and Mediobanca plus Banca Generali. The third element of anomaly is the run-up of the Monte dei Paschi AGM. We have seen that in the run-up of this AGM, roughly 10%-12% of the capital was bought. So the share price rallied. The acquirer were the second largest shareholder of Mediobanca and a number of Italian pension funds. The same acquirer materialized in Mediobanca run-up to the AGM of the 16th of June. We had the second shareholder of Mediobanca plus the same Italian pension fund plus the second largest Italian bank, and they bought altogether 12%. As we said, a transaction that was judged by all the brokers or most of the brokers and all proxies was judged very positively, but it did not have strong support for reasons that were not clear. We were to postpone this to give more comfort to these shareholders. I mean, these were the same shareholders that bought the shares in Banc Monte dei Paschi di Siena and then bought the shares in Mediobanca. The last element of anomalies is the role of the government. Here, the government is playing different roles. It is selling the block to this four-shareholder group. It is keeping the de facto control of the board of Monte dei Paschi because, if I am not right, today, the appointees of the government. Are at least 50%, roughly 50% of the board of Monte dei Paschi, even including the Chairman and the CEO. At the same time, the government is having golden power in general and on the banking consolidation. As we read in the last few months, very strict recommendation or condition imposed to some of the consolidator. This situation where the government is having multiple roles, so major shareholder of Monte Paschi, de facto controlling the board, using the golden power, has made that a number of actors in Italy, directly or indirectly, decided to back this transaction. We saw it because we saw it in the behavior of Monte dei Paschi and Anima on the general meeting of Mediobanca. We saw it in Amundi in the general meeting of Mediobanca. We saw it in the second largest bank in the shareholder of Generali Mediobanca. There are also other shareholders of Mediobanca which are having other interests in Italy that I think were affected by this situation. This transaction is non-customary for several reasons that I mentioned. In terms of ID synergies, let's elaborate a bit more on that because basically, as I said, the reason of this synergy is partly explained by the lack of growth that we have or will have compared to the status quo, the standalone plan. We think that, in particular, in wealth management, two-third is lack of growth. We plan to grow by EUR 10-11 billion of net new money. Here, we are saying that we are going to grow by EUR 5 billion per year. We think that, in particular, we will have the most impact in the high-end part of private banking. Why? Because our private banking staff is of great quality. Every single. Private banker of Mediobanca Private. Has a very important average portfolio. There is a concentration of AUM in the first, I would say, 20 bankers. Hence, it is easy to see how this can be impacted. We think that also the product companies that are less basically related to private banking, are more institutionally driven, like Polus and RAM, can be basically more driven to find new shareholders. This explains, as I said, a bit. On two-thirds is lack of growth and 30% is more exit of staff. In CIB, it is more equal, 50/50. How? We see basically, we need first to understand that we are starting from a record year. This year will be a record year for IB. Also, defending this number and improving like what we have done in our plan requires 100% focus, 100%. Basically sticking to our model of private investment banking, which is fostering each other. If we have an integration period, it's likely that basically some of the best staff can go, of basically the historical CIB and PIB model. Of course, also the boutique we have outside Italy, we don't think that in the long run can really be attracted by a model of commercial banking. We don't forecast for them to go right away, but in three years' time, there is a big risk that this may materialize. This is in a nutshell. In case of no merger, Monte dei Paschi will not benefit from the deposit synergies, and it would need to make up for EUR 6.2 billion of MREL deficit by issuing senior preferred bonds, as this cannot account for Mediobanca bonds in case of no merger. They will have to issue additional EUR 6 billion of bonds at a COF, which is estimated in the region of 140 basis points. This is another material disynergy in case they do not achieve the merger. Thank you. Thank you very much. Thank you. We will now take the next question from the line of Hugo Cruz from KBW. Please go ahead. Hi. Thank you for the time. Just a few quick three questions, if I may. First of all, can you remind us what percentage of the Compass loan book is originated outside of Mediobanca and Monte dei Paschi channels? The second question, your slide talks about a central cost base of EUR 120 million. How much of that is just from being a listed entity in the case of Mediobanca? Third question, what feedback have you been receiving from your average institutional investors so far about the offer and your current business plan? Thank you. Let's start from the third question. We have different shareholders, different category kind of shareholder. We have institutional long shareholder, long only or long. We have a number of stable shareholders. Their feedback is exactly what we have been saying, is they do not like this transaction. They do not see a rationale. They do not see how this transaction can work and be improved. Some of them are worried. Some of them have diminished their exposure to Mediobanca. We keep on saying that if we stick to our business model, if we stick to our standalone plus Banca Generali, they will have great satisfaction. Of course, there are other shareholders that have different view or interest. In particular, if you think about. Some merger arbitrage, they look at the transaction in a different way. They are not sticking to the bank after the deal. If they are, for instance, long of Mediobanca and short of Monte dei Paschi, for them, it's enough that a certain condition that deal takes place. Of course, this is another view. The stable shareholder, the long-term shareholder, institutional shareholder. The feedback is not positive. If we look at the first question, it is how much of Compass loan book is outside. Basically Monte dei Paschi. Or it's, I mean, the new loans of Monte Paschi business is roughly EUR 500 million. Out of basically the new loan production that is EUR 8 billion. We have other two or three agreements that are, one is important with Poste Italiane, other with smaller bank. I mean, as you know, Hugo, our strategy has been more and more to generate directly from our network. This part is becoming, in terms of revenue, in terms of profitability, quite small. Can you repeat the second question? Because the line was not clear and we could not really understand. Yes. Your slide mentioned central costs of EUR 120 million for Mediobanca? A nd it is hard to cut that further. I was just wondering how much of those 120 are just from the cost of being a listed entity? It is not that the listed entity, it is more the fact that we are a significant, supervised by ECB bank. The fact is that there is a threshold under which you are under the ECB supervisory activity. I would say that these 120 are basically the. Central costs that are stemming from the fact that we need to guarantee a level of control, planning, common function that are, I would say, other way to the complexity of our business. For this reason, we said, "Okay, part of this can be cut." Of course, if we are part of a group, this can be cut. We don't think that we can get to a higher number because some of these activities are very much specialized. The fact that you have a wealth management or risk management on wealth management, on consumer, on CIB, cannot really substitute it by the same risk management of Monte dei Paschi. Also, in terms of IT system and platform, are different. Of course, part of this can be cut. I mean, we don't think that this can be. Not really close to the number EUR 300 million suggested by Monte dei Paschi. Okay. Thank you very much. . Thank you. As a reminder, if you wish to ask a question, please press star one one on your telephone. We will now take the next question from the line of Britta Schmidt from Autonomous Research. Please go ahead. Yeah, hello. Thank you very much for taking my questions. I've got three follow-ups, please. The first one is, it's obviously a little bit difficult to put value on an entity in a deal that you consider EPS diluted. And usually, we look at upside from synergies, and here you see downside. How has that been treated in the exchange ratio estimate of 3.71? Am I right in assuming that you've assumed a compensation for Mediobanca shareholders for the value loss? My second question would be, could you give a little bit more color on how you estimated and quantified the one-off retention costs, especially in Wealth Management? If there was higher retention, have you factored that into the disynergies? Are you saying that these disynergies could be even higher without the additional retention costs? In the no merger, there is no difference between the merger and no merger scenario in the revenue disynergies. There is an argument that we have heard being used that a separation could help staff retention and hence lower revenue disynergies, but you do not see a difference in these two. Why is that? Thank you. You can see in the fairness opinion that are provided by the different banks that clearly they take into consideration the synergies in all the criteria. Basically, in the dividend discount model, in the cash flow, of course, they put the number of the synergies. In the other method, which is a method not so much different from DDM, and then in the control method, like market multiple, they make, of course, the net present value of disynergy and synergies. We think that these disynergies are prudent. They are not basically set to make a big case or big drama. On the contrary, it's like if, as I said at the beginning, if we basically stay as we are or a bit less as of today compared to 2028. We are not going to say that in 2028, the bank is going to collapse. On the contrary, we're saying that we will zero the growth, which is the growth we have always achieved. It's an important growth. This growth cannot be achieved because basically. This may happen also in other transactions. Because if you are entangled in a combination with another entity or a different DNA, even if you do a combination with a similar animal, the fact that you have to integrate, the fact that you have an extraordinary effort, you lose a lot of attention, a lot of focus on growth. As we are a growth company, we've been growing a lot organically and with small acquisitions, it's natural that with such big changes, we will lose this growth. We are saying this. We are not saying, "Okay, the bank is going to, as I said, collapse." Retention cost. Of course, we said, "Okay." For the same reason that I said now. We say, "Okay, part of the staff will stay." We're not saying that all will leave. We say that the highest part of private banking, they are likely to go because of the fact that the clients want them to go because they do not think that Monte dei Paschi brand is the bank of choice. I mean, the rest will stay. We think will stay. In order to stay, you will need to have some pot of money onto the table. This is the reason of the cost, the, I would say, retention cost we have forecasted. Can it be higher? Yes. Of course, it can be higher because this is an estimate we have done. The worst will be the situation of no clarity. We said that the situation 3540, where it is not clear what is the outcome, it is not clear the fact of control, is a situation of unclear governance, unclear direction. Can be further detrimental to the numbers of the bank. Of the combined entity. Because in these cases, I think the talent and the TFA assets outflow will be faster. For this reason, we said we call it no merger, regardless that you have a real merger or not. I think the outcome, the better outcome is clear, the clear one. Either Monte dei Paschi achieves to get full control or it does not get to the fact of control. I mean, in between, it is going to be worse for both of us. Thank you very much. Thank you. There are no further questions at this time. I would like to hand back over to Mr. Alberto Nagel for closing remarks. Thank you very much for your patience. We hope to have all of you in two weeks when we will have the call for the full year results. Thank you very much. This concludes today's conference call. Thank you for participating. You may now disconnect.