Welcome to ABN AMRO's Q1 2026 analyst and investor call. Please note this call is being recorded, and for the duration of the call, your lines will be on listen only. Analysts will have the opportunity to ask questions after the presentation. This can be done by pressing pound key five on your telephone keypad. I will now hand the call over to the speakers. Please go ahead. Good morning and welcome to ABN AMRO's Q1 2026 results presentation. I am joined today by our CFO, Ferdinand Vaandrager, and our CRO, Serena Fioravanti. I will cover the key messages, our progress and strategy, and our financial results for the quarter. After the presentation, we will open the line for your questions. Let me begin with the key highlights of the Q1 on slide two. This Q1 was a strong start to the year, with net profit increasing 12% compared to the same period last year. We booked a net profit of EUR 693 million, leading to a return on equity of 10.7%. There was solid growth in mortgages and corporate loans during this quarter. Growing deposit volumes were the main contributor to higher commercial net interest income. Fee income reached a record level, driven by strong clearing performance resulting from high market volatility. Underlying costs declined further. We are therefore lowering our full year 2026 cost guidance to around EUR 5.5 billion. Credit quality remains solid, with limited net impairments and a cost of risk of 9 basis points despite increased geopolitical uncertainty. Our capital position remains strong with a CET1 ratio of 15.5%. Let me now go into more detail on how we are delivering on our strategic targets. For our core products, mortgages and client deposits, we are on track to reach our 2028 ambitions. For client deposit growth, we stand at 46% of our 2028 ambition and including the intended acquisition of NIBC at around 63%. With EUR 2 billion of mortgage growth this quarter, 30% of our growth ambition has been realized. Again, including NIBC, this rises to around 73%. We are making sustainability more accessible and financially attractive for homeowners. Mortgage interest rates can be linked to a home's energy label. This rewards our clients for making their homes more sustainable. Turning to client assets, this quarter was impacted by market volatility and seasonal effects. However, the conversion of cash and time deposits into mandated and advisory products continued. We expanded our investment offering with the launch of regulated crypto investment products. This gives clients transparent access to this new asset class. In corporate banking, profitability benefited from record high clearing fees and also strong fees for global markets. This came alongside growth in our transition financing, including defense and renewable energy. On the next slide, turning to our cost ambitions. By simplifying our bank and reducing run rate costs, we are delivering on our promise to rightsize our cost base. Over the Q1, FTEs again decreased by more than 500, mainly among external staff. Total FTE reduction since the end of 2024 now represents around 40% of our 28 target. In terms of cost savings, a further EUR 60 million was achieved in Q1. This brings cumulative savings to around EUR 220 million out of a total of EUR 900 million, mainly from increased efficiency and ongoing IT streamlining. Alongside cost discipline, we are also improving productivity by embedding technology and AI more deeply in our daily work. We have moved faster than expected in achieving cost reduction, so I expect the pace to slow down somewhat from here. This quarter, we also made further progress in capital optimization. Now turning on to the next page. Optimizing capital allocation is a strategic priority. Corporate Banking has clear reduction targets for both portfolio optimization and RWA optimization. Together, these target a EUR 10 billion reduction, and this quarter we realized an additional reduction of EUR 1 billion. We have therefore now realized around 50% of our target, mainly through RWA optimization. This reflects the partial reintroduction of the SME support factor, improvements to our data quality, and collateral sourcing. Portfolio optimization are more gradual and include the closure of Asset-Based Finance International. This is proceeding as planned. We have identified EUR 8 billion of RWAs for active portfolio management and around 20% has been securitized by the SRT transaction we executed in Q4. All these RWA reductions strengthen our capital position and enable us to invest selectively in profitable growth opportunities. We are on track with our commitment to lower the share of allocated RWAs in corporate banking, which currently amounts to 51%. Turning to the Dutch economy. The Dutch economy remains resilient despite the current headwinds. Q1 GDP growth slowed to 0.1% quarter-on-quarter. Over the full year, GDP growth is forecasted 1.5%, slightly downgraded due to the Iran conflict and energy shock, while inflation has been revised up to 2.8%. On housing, after two years over 8% price growth, we expect prices to moderate to +3% in 2026 and +4% in 2027. Transaction volumes hit a 10-year record of around 239,000 in 2025, are expected to decline by 6% in 2026 and 4% in 2027 amid heightened uncertainties and also limited supply of new homes. Despite this, the economy faces this turbulence from a position of strength. High household savings, low debt ratios, and a still tight labor market are providing meaningful buffers. I'm turning now to our financial performance for the Q1, starting with client deposits on slide eight. The quarterly movements in client deposits should be seen in the context of some seasonal effects. Around year-end, clients tend to hold more cash, while in Q1, we typically see higher tax payments. In this context, broadly flat client deposits in Q1 are a solid outcome. Over the past quarters, we have seen a continuous growth in deposits in non-global strategy conditions. Now turning to client assets, I already mentioned that volatile markets during March led to lower asset values. Overall, we continue to see that our commercial efforts are leading to conversion to mandated and advisory product, keeping our progress on track. Now turning to interest income. This quarter, commercial NII improved by EUR 36 million. Mortgage volumes continued to increase, with growth increasingly coming from government-backed mortgages. These mortgages carry lower margins, and this explains a one basis point decrease in asset margin. Average liability volumes were higher, reflecting continued underlying growth in deposit volumes. This was the main driver for the growth in commercial NII. The liability margin was broadly unchanged, reflecting the stable replicating yield. Other commercial NII also increased in Q1, amongst others from higher financing demand from clearing clients. Now turning to the interest rate outlook and what this means for us. Compared with last quarter, forward rates have risen sharply in reaction to geopolitical events. Current forward rates imply a further tailwind to our liability margin. This creates upside to our full-year commercial NII guidance. At these forward rates, this could be close to EUR 100 million additional interest income over 2026. However, we have decided to keep our guidance unchanged for now. It is difficult to foresee indeed if these rates will persist, given the unpredictable nature of current events. We expect we can narrow down our NII guidance with our Q2 results. I'm now turning to our fee income. Fee income increased 6% quarter-on-quarter, showing growth in scalable capital-efficient business revenues. In personal and business banking, we introduced new pricing for client accounts at the beginning of the year, and this led to higher fees. The negative market performance in Q1 affected fees in wealth management. By contrast, the higher market volatility led to strong results for clearing due to increased trading volumes. Also, our global market activities had a good Q1. On other operating income, it has been relatively low for the past three quarters. One reason has been the lower equity participation results. Market circumstances are unfavorable for both revaluation and exits. Also, This reflects updated macro scenarios and a significant increase of our negative scenario weighting from 30%- 55%. The negative scenario includes longer disruption to energy supplies due to the war in the Middle East. With these changes, we believe we have taken into account both first and potential second-order effects. We have not made additions to the management overlay, which remains stable at around EUR 75 million. We continue to actively monitor potential impacts from macroeconomic and geopolitical developments on our loan portfolios. We do not expect a material impact. This reflects the strong quality of our loan book, prudent risk management, and strong collateral across all our portfolios. This is also reflected in our very limited private credit exposure of around EUR 200 million. Turning now to our capital position. Our proforma CET1 ratio rose slightly to 15.5%. This excludes the potential impact of around 70- 80 basis points from the acquisition of NIBC, which we expect to book with Q3. RWAs increased by EUR 1.2 billion in Q1, largely related to business developments in corporate banking, partly offset by data quality improvements. RWAs for clearing increased from a reversal of the seasonally lower RWAs in Q4 and the onboarding of new clients. The Dutch Central Bank has decided not to continue the mortgage floor beyond the current period ending at the end of November. Depending on market and volume developments, this could lead to a reduction of around EUR 7 billion in our mortgage RWAs. In terms of capital implications, let me start by saying we are committed to returning at least EUR 7.5 billion of capital by paying out up to 100% of net profit over the years 2026-2028. These represent substantial commitments. The removal of the DNB mortgage floor is an upside to our plan and all else equal benefits our capital position. We said at the CMD that if over a period of time our capital position remains significantly above our target and we are delivering on our strategic ambitions, we may consider additional distributions. Before considering additional distributions, we need to see capital consistently exceeding our target and further deliberate on our strategic ambitions. Let me close with the key takeaways for the quarter. Today's results show that we are delivering on what we said we would do. In Q1, we made strong progress across our strategic priorities, grow profitably, right-size our cost base, and optimize capital allocation. We showed profitable growth, adding a further EUR 2 billion to our mortgage portfolio. We also delivered record-high fees. We are keeping our NII guidance unchanged while acknowledging the potential upside from current interest rates. We also maintained strong cost discipline and have lowered our cost guidance for FY 2026 by EUR 100 million- EUR 5.5 billion. With CET1 ratio of 15.5%, we remain well-positioned to invest in our strategy, support our clients while returning capital to our shareholders. In a nutshell, we're focused, we are committed, and we continue to deliver on our promises. I thank you very much for your attention. We will now open the line for your questions. Thank you. The next question comes from Giulia Aurora Miotto from Morgan Stanley. Please go ahead. Hi. Good morning. Thank you for taking my questions. I have two. The first one on the improved cost guidance at EUR 5.5 billion. It's nice to see an improvement, it still seems quite conservative to me. I appreciate that Q4 is normally, you know, seasonally higher. I appreciate the CLA, I would think it could be, you know, almost EUR 100 million lower than what you're guiding to. Can you help us think about potential upside or if I'm missing something on the cost guide? Secondly, this mortgage floor, 70 more basis points, basically, that is coming your way by year-end, plus the over-delivery so far. How should we think about the potential for perhaps an interim excess capital distribution? I hear you, Marguerite, you said you want to, you know, show a bit more delivery. You're at the beginning of the journey. In terms of timing, should we think about maybe Q3? Is that a realistic timing for ABN to raise a request to the ECB for an excess capital distribution? What's the best way to think about this? Thank you. Thank you. Thank you very much, Giulia, for your questions. You know, in terms of our cost guidance improvement, indeed, we are pleased with our pace. We are pleased with our discipline and commitment to delivery. This is what allows us to improve, you know, even though we are early in the journey, to improve our cost guidance by EUR 100 million- EUR 5.5 billion. This is a guidance we're very comfortable with. I also pointed out that, you know, indeed there may be things to be considered, like, you know, pointing out to our CLA negotiations happening in June. You know, we as a rule, we commit to things we are in the capacity of delivering ambitious targets, but realistic as well, so that we can be predictable. When it comes to, you know, the DNB mortgage floor and its consequences, you know, we shared the figures with you. As you know, we always assess our capital position at Q4, and there will be no change in that respect. We will be assessing our position at Q4. As I shared, we are happy with the way we start the journey, but this is the beginning of the journey. This is a marathon, so we do it quarter after quarter. Thanks. The next question comes from Benoit Pétrarque from Kepler Cheuvreux. Please go ahead. Yes, good morning and well done really on the OpEx development. Two questions on my side. The first one will be again on OpEx. You've achieved 40% of the planned FTE reduction already in Q1. I think you announced the CMD just four months ago, clearly the speed of execution is very strong. Are you already seeking to maybe update the plan at some point? I was also wondering if, in the context of renegotiating the Collective Labor Agreement in H2, whether we should expect maybe a bit of an update at some point during the year around the FTE reduction plan for the long term. That's the question number one. Number two is, actually, yeah, maybe on liability margin, you know, things are looking better already. Conceptually, do you think your EUR 7.2 billion NII number is still the right one at the current curve? Thank you very much. Thank you. Thank you very much. You know, on cost, let me reiterate what we shared at our CMD. In terms of FTE trajectory, we committed to, you know, a total reduction of 5,200 by, you know, 2028. Indeed, where we stand now, we are pleased with the pace we've been achieving. You know, 40% of the overall target. I also shared that we do expect this pace to, you know, moderate in the coming quarters, but we like the fact that we started with a strong start. It is the beginning of a strategic plan. Don't get me wrong. You know, whatever we can do better, we will do better. It is still early in the plan, and right now we are very much focused on delivering on what we already committed. On the liability margin, do you want to take that one? Yeah, maybe more in general, as you asked, Benoit, we have very strong confidence in our NII guidance, commercial NII guidance for this year of EUR 6.4 billion. It's also, as Marguerite said during the presentation, in current volatile market environment, we expect to have better visibility at mid-year. In the disclosures in the presentation, we recognized the forward curve has improved, hence the guidance can be seen as somewhat conservative if a pro forma will to materialize. That implies upside potential to our guidance of roughly EUR 100 million. You should not look at isolation at this, right? With higher margin, deposit competition, what we see already of smaller players might increase. Also higher interest rate curves might be the consequence of higher inflation, which might feed into less growth or higher loan losses. Yes, we're very confident, but I reiterate what Marguerite said earlier, mid-year is a better moment to reflect on our guidance for the full year. Thank you. Just Marguerite, on the CLA, what can we expect from that? Just to clarify a bit what the expectation should be. What we can expect, what you can expect that it is an important moment for bank, for colleagues. We enter these negotiations in a spirit of, I would say, transparency and a respectful approach. I am confident that both from management and unions, everyone will have at heart to reach an outcome that will be in the interest of all our colleagues, but also the long-term health of the bank. I cannot speculate, of course, on negotiations that have not started. They will happen in June. I think the spirit is the right one. Thank you very much. The next question comes from Namita Samtani from Barclays. Please go ahead. Morning, thank you for taking my questions. My first question. When you note that the current curve provides EUR 100 million upside to your commercial NII already this year, does that also include an offset from your 100% pass-through assumption? What's the pass-through assumption here for 2026 in terms of deposits? Secondly, just on the ROE in the corporate bank, the Q1 ROE of 9.5% it's a lot better than the Q4, but it still falls quite short of the 12% group ambition by 2028. How do you see margins in the corporate business, and what else needs to be done to improve the ROE here? Thanks. Thank you very much. I will let Ferdi take your questions. Two short remarks on my side. One, we have You may have seen our slide describing how, you know, the underlying assumptions we provide in our for our replicating portfolio. I think you have. I will let Ferdi take you through these assumptions. With respect to CB, I think we are indeed, you know, moving at pace within our corporate bank in improving our profitability, which is, you know, our main target for CB. We are actually quite comfortable with the pace we are having. Keep in mind that the target we have for CB, you know, in 2028 is 11%, huh? For this division. Ferdi? Namita, specifically the assumptions for our liability margin, and that's what we explained during the CMD. For the trajectory, we assume broadly stable margins, so 100% pass-through on interest-paying deposits. Except for current accounts in our replicating portfolio, have we seen an increase of replicating portfolio to around EUR 175 billion, and roughly 30% of that or EUR 50 billion is current accounts. The current accounts where we pay zero interest on, that is structurally accretive. The current accounts is the full explanation of the increase in the liability margin you see on slide 10 in the presentation, and the margins move in line with the yield of the replicating portfolio. That's helpful. Thank you. The next question comes from Delphine Lee from J.P. Morgan. Please go ahead. Good morning. Thank you for taking my questions. The first one is on just going back to cost. Just to check, first of all, what was your sort of wage increase assumption in your business plan? Just we have kind of like, you know, a rough idea of what to expect with the CLA. Just in terms of the cost trajectory, I mean, execution clearly is much stronger. Do you intend to still keep the same target in terms of FTE reduction, or could that go even further than that? Do you intend to invest a bit more? Just to understand a little bit what are the sort of moving parts, you know, between now and 2028. On The second question is on the payout. I mean, clearly, I mean, CET1 has been consistently above 15% now, comfortably above 15%. The mortgage floor removal will finance, you know, sort of the NIBC acquisition largely. Just trying to think, you know, why should we assume that with Q4 results, we should definitely get more than a 100% total payout? If I could squeeze a last one, if that's possible. Any guidance on other income, which has been a bit weaker, And how much of that is kind of like structural? If you could give a bit, you know, more guidance on that line, that would be helpful. Thank you so much. Thank you. Thank you very much for your questions. I will, Ferdi will take the one on, you know, other income. On, on capital distribution, let me reiterate what I shared with you in the presentation. Indeed, we are committed to returning at least EUR 7.5 billion of capital and to pay out up to 100% of our net profit over 2026- 2028. This is what we committed at our CMD. These are serious commitments. Indeed, the removal of the DNB mortgage floor is an upside to our plan and so it benefits our capital position. What we also shared at our CMD, you know, is that if over a period of time, our capital position remains significantly above our targets, and if we're delivering on our strategic ambitions, we may consider additional distributions. That assessment, we're not making it today. We're, you know, at an early stage of our plan. We are pleased with the strong start we are making and right now very much focused on our execution. I will reiterate the same on cost. You know, we improved our cost guidance till 2026. We are not changing the FTE trajectory we shared at our CMD. We achieved 40% of this trajectory already, but I also indicated that, you know, this space will moderate over time, so it's good that we made a strong start in the plan. But this, you know, this figure is not being, you know, updated or changed right now. On other income? Yes, on other income, the last point, what is in our plans, that was also your question. Oh, yeah. Underlying, it's 2% inflation- Yeah Delphine. We also said if inflation is higher, we will absorb it, to realize- Yeah The targets and guidance we provided. For other income, that has been lower than average in the past, a few quarters, and mainly led to number one was the results of equity participations and direct equity investments. That was roughly EUR 10 million-EUR 30 million lower than average because it's clearly not a very favorable market for revaluation and exits. Number two, it was the ALM results in other income. That was in the past three years. That was lower negative than what we currently see, and that is mainly relating increased hedging costs due to market volatility. Those are the underlying explanation. It's volatile, so we do not provide specific guidance on other income, but we just try to be helpful in explaining what the underlying buckets are. The only thing what I want to mention, we said that before, you do see incidentals in there. For example, we already indicated that for Q4 this year, we expect roughly EUR 100 million net impact book loss for the sale of our consumer credits business, and that will be booked in other income. Just to be mindful, try to be helpful for your modeling. Also to help you, going back to your, you know, cost question on, you know, on the CLA. Just for you to have in mind, first that, you know, just our staff in the Netherlands represents, you know, overall 85% of our total internal FTEs, just to give you know, an idea of the scope. Also, as a rule of thumb, you know, a 1% CLA increase leads to roughly, you know, EUR 20 million-EUR 30 million higher cost per annum. Just for you to have these metrics, if that can help you in your modeling. Perfect. Thank you so much. The next question comes from Benjamin Goy from Deutsche Bank. Please go ahead. Yes, hi, good morning. Two questions please on commercial net interest income. The first on loan demand. Your remarks on the Dutch economy sounded quite positive, just want to confirm the trends you see on loan demand now with basically two months of higher interest rates, whether it's on the mortgage side, whether you see a small impact going forward maybe, and on the corporate side, whether there is a change in behavior, whether you see less investment loans and demand for that. Secondly, your liability margin stabilized in Q1. Should we expect at the current rates already an inflection and moving up in Q2? When do you think would it happen? Thank you. Thanks. Ferdi will take your question on liability margins. What we observe in the economy right now and also, you know, based on many conversations we currently have with our clients. First, you know, the Dutch economy is resilient, and as I said, it has been entering this period with from a position of strength. Overall, this is an economy that is over-performing, you know, on average the EU economy and has, you know, very strong buffers. We gave on the mortgage side, I think, very clear indications on what we, you know, observe in the housing market, i.e., after record years of growth, we do expect, you know, housing prices to moderate, and we do expect the number of transactions to slightly decrease in 2026 and 2027 compared to the record high we had reached last year. What we, you know, see in the conversations we have with our clients is that they are overall, I would say, resilient. I think they know how to adapt. At the same time of course, they have concerns on the current, I would call it, geopolitical stalemate because we are also aware and, you know, you have it in the notes of our economic bureau that a prolonged conflict would have, you know, an additional impact on energy prices. And we, you know, factor it in more in, you know, if, I would say end of June, you know, beginning of July if no solution were to be found, that could be impactful, you know, in terms of secondary effect on growth and inflation. I think right now we're comfortable and we find, you know, the economy resilient, but it will all depend on the length of the conflict. Ferdi, on liability margin. Yes, Benjamin. You don't get it directly from the margin graph. The liability margin very marginally improved in Q1. That's in the 114 basis points, so it's just less than one basis point. That increase was more pronounced clearly at the end of the quarter in March when interest rates started moving. What you do see for this quarter, that the improvement is mainly from the replicating portfolio with shorter duration. That is mainly wealth portfolio. It will take more time for the benefit of portfolios with a slightly longer duration to start feeding into our replicating portfolio. The higher yielding swaps are gradually coming in. That means that further liability improvements over the coming quarter is definitely expected. Lastly, Benjamin, just to reiterate that in the liability margin is only an increase of the current accounts because it's our underlying assumption that you have a full pass-through for deposits, where interest is being paid. Thank you. The next question comes from Matthew Clark from Mediobanca. Please go ahead. Good morning. Two questions, please. One is on the Wealth Management cost of risk, or credit loss provisions, which have been unusually high for the past two quarters. Can you give us a bit more insight on what's driving that? Because it's a bit unusual to see that in Wealth Management divisions. The second question is on the DNB mortgage floor, capital release coming later in the year. Do you expect to see some of that benefit passed on to customers via tighter mortgage spreads, or do you think that benefit all stays with shareholders as capital relief? Thank you. Thank you very much for your questions. Serena, I may let you answer the question on, you know, wealth management and cost of risk. On the DNB mortgage floor impact, we are, of course, operating in a competitive market and so since, you know, this is, an impact that is, benefiting, you know, all banks, in the Netherlands, this will also be reflected in, you know, the competition market and the pricing. This is something that will happen, you know, in November, so it is too early to speculate on price impact. Indeed, you know, this is a competitive market, so all things being equal, it will also be reflected in pricing. Serena, on wealth management. Yeah. Thanks, and thanks for the question. Indeed, loan impairments have showed an increase in wealth management. This is due to a few single cases and individual cases and files, which we're booking our wealth management franchise but are underlying are also corporate loans. We feel comfortable with the positions and on the underwriting criteria, and these are just individual activities, but no correlations with others. Can you clarify whether they're part of your legacy business or whether they're part of the HAL business you acquired? No, this is part of our underlying business, of entrepreneurs and wealth management, activities. We are continuing to do these activities in all the countries in the wealth franchise. Again, it's a couple of single cases, that we do not comment on. All in all, what you have to bear in mind is that these are dual clients from wealth management and CB, and our underwriting process are exactly the same for these clients in wealth management or they are for CB. These are the same teams. You should not have any specific concerns. Thank you. The next question comes from Johan Ekblom from UBS. Please go ahead. Thank you. Just maybe starting on the cost side. If we look at the FTE reductions you've achieved, it looks like the vast majority, you know, certainly this quarter, but also last year, came from reduction in external FTEs, which I guess is a positive because they'll probably be, on average, more expensive. You know, the slower reduction pace we're seeing internal FTEs, is that a timing effect or are there big differences between gross and net from internalizations? Just trying to understand if kind of the easy pickings are done and it gets harder from here or if there's anything else we should consider there. Secondly, just coming back to the mortgage floor release. I guess, have you had any conversations with regulators as to whether this capital released is kind of distributable? I mean, there's been a number of banks that have struggled to push beyond the 100% payout. As this is the kind of one-off capital relief on your side, is that an opportunity to engage in such a discussion with the regulator, or have you attempted to do so? Thank you very much. I like very much the way we all your questions and I fully understand it. I'll try to, you know, get more on this topic. I will only reiterate, not speculate on anything, only reiterate, on what I've already said when it comes to capital distribution. Again, this is, you know, we assess our capital situation at Q4 and we don't speculate before that. On FTE reductions, you're right. The bulk of the impact so far has come from reductions in our external workforce. What we have done also in these past quarters is internalize some of these, you know, external talents into our internal teams because we want to make sure that we always have, you know, the best talents and expertise. It is true, for instance, in IT or tech, but, you know, not only. That also explains the differences you may observe between internal and external FTEs. As we shared also at our CMD, everything we shared in terms of, you know, cost savings, and I would say in terms of everything we shared in the CMD, is grounded in business cases. Basically, we actually know how we are executing on this trajectory. It is grounded on, you know, it's a bank-wide effort, grounded in overall simplifications of our bank. We, you know, we provided a number of examples in terms of, you know, integrating ABF or Asset Based Finance within the main bank, simplifying risk, simplifying DFC, you know, you name it. Everything is grounded, so we know how to execute on that over time. As I indicated, you will see the pace moderating in the coming quarters, and this is expected and part of our trajectory. Yeah. maybe on the mortgage. Oh. The mortgage floor, what I can say there, Johan, we said it before, and we see it also as simplification, gold plating, and also a fragmentation of macroprudential buffers. We've always said we do see quite an overlap with the countercyclical buffer. We think it's a logical step, but you should not have a direct link between the release of the mortgage floor into distributable capital. Thank you. The next question comes from Alberto Artoni from Intesa Sanpaolo. Please go ahead. Good morning. Thank you very much for taking my question. I just have one 'cause the other one has been already answered. On NII, you provided the indication that the current forward rate would, everything else being equal, improve the NII for 2026 by about EUR 100 million. What would be the impact in future years? Should we think of a similar type of impact or higher or lower? Thank you for your question. Ferdi, you can sort of infer it from our graph, but I don't know if Ferdi, you want to elaborate on that. Yeah. I mean, what we can say here, have forward curve changed continuously. If you look at the forward curve today, there are definitely potential benefits. For 2028, we have not provided guidance, during the CMD, we provided an indication that NII, commercial NII could rise to EUR 7.2 billion, including NIBC, based on the economic outlook and interest rate forecast at that time. For now, it's too early to start looking at, do we want to change this indication or not? As Marguerite said earlier, I mean, maybe mid-year is a better point to start re-evaluating for the interest rate at that time. For now, no changes. Okay. Thank you very much. The next question comes from Anke Reingen from RBC. Please go ahead. Yeah, good morning, thank you for taking my question. I just have a follow-up question on the replication portfolio. I just wanted to confirm that your NII guidance basically assumes stable volumes on the replication portfolio. I was wondering, I guess it had gone up from EUR 165 billion- EUR 175 billion in the quarter. Would that not already explain quite a large part of the upgrade in NII or not because the part of current accounts has come down from EUR 65 billion- EUR 50 billion? Is this not quite comparable? If you can please clarify. Thank you. Ferdi? On the NII guidance, yes, the replicating portfolio increased, but the biggest part there was demand deposits and not current accounts. That is underlying this assumption. Secondly, your question again on NII sensitivity. We really plot that versus the current account, which is roughly EUR 50 billion in this. That is the basis for our guidance for this year. Just to confirm on your NII guidance, you assume a replicating portfolio unchanged with EUR 50 billion of current accounts, and the EUR 50 billion is comparable to the EUR 65 billion? Underlying, if you look at our assumption, we do expect deposit growth. We said that earlier. It's deposit growth from roughly EUR 2 billion per quarter, so seasonally a bit lower. ABF part of that might be current accounts. There's also underlying assumptions clearly in our NII guidance that we do see volume growth. Okay. All right, thank you. Yeah. The next question comes from Shrey Srivastava from Citi. Please go ahead. Hi, thank you very much for taking my question. Just again on the NII. On the EUR 100 million uplift, obviously, it assumes a full pass-through. That's the dynamic you're seeing that would suggest this. Because if I look at what happened in the last hiking cycle, it would seem particularly on the demand deposit side that you pass through a significant proportion less than this, of the order of 50%-60%. A second one is just a clarification. If you could confirm how much of your short duration replicating portfolio is geared to three months versus six months versus the other buckets. If that's all right. Thank you. For your question, I will let Ferdi answer them. Indeed, bear in mind that since we are operating in a competitive environment, we also, I would say, take fairly mechanistic assumptions in our replicating portfolio so that you can make your calculation. We do not make, you know, hypotheses in terms of, you know, pricing behavior based on competition in the market, because that would have, you know, also a commercial impact. We don't do that. We have more, I would say, a mechanistic approach of the behavior of the portfolio. Ferdi. Yeah. Exactly, you could say, are we conservative or not? There's definitely competition in the market. You could argue it's conservative. If we have more indication of pass-through, we will update our guidance on the back of that. If you look at our replicating portfolio, we invested over the whole curve, up until 10 year. The only thing we said there, around 40% of the replicating portfolio reprices within one year, and a big part of that is in the three-month bucket. The overall duration is three years of the replicating portfolio to give some more indication. Thank you very much. If I may just very quickly follow up. If assuming we do get some ECB rate hikes this year, do you expect any material difference in competitive behavior from the last time the ECB hiked rates a few years ago? Has anything changed that we should be thinking about? Thanks. One thing also you need to take into consideration in the hypothesis of our economic bureau is that we price, you know, like the market, we price, you know, right now two hikes in 2026. At the same time, our, you know, assumptions, and that's also based to the normalization of the current geopolitical event, is that this increase will be reversed in 2027. That's not necessarily what you see in the forward curve. I would say different assumptions. I mention it because then depending on, you know, the more or less lasting effects, you may have also different competitive and pricing behavior and also expectations from clients on. It depends really on how you expect the current events to evolve over time. Yeah. It's also the main banks don't price directly of ECB rates. They always price on the back of the replicating portfolio yield. Also take that into account as most of the larger bank run their deposits in replicating portfolios. Yep. That's very helpful. Thank you very much. The next question comes from Farquhar Charles Murray from Autonomous. Please go ahead. Morning, all. I have two questions if I may. The 1st one's actually following up a little bit on that competitive discussion on the last question. On the deposit competition side, have you actually seen smaller players move, and is that on the savings accounts or more on the term side of things? More generally, from your own perspective, does the degree of volatility you see, the scenarios that are out there, kind of encourage you to move quickly or actually slowly? Secondly, the leverage ratio is off quite a bit Q on Q. I know there's some kind of seasonality to that, but it seems a bit of the heavier end of things. I wondered whether the volatility in the market and maybe clearing had played a part in that and what we might then expect in the second quarter. Thanks. Ferdi, on the competitive dynamics of the market and behavior of, you know. Farquhar, clearly, what you do start seeing is some of the more challenger and smaller banks are starting to price up. You do see the competition there. There I'm also ahead. That's also one of the underlying reasons we are more conservative there in our assumption. If you look at the leverage ratio, that was your second question, yes, it decreased to just below 5%, but that is mainly what you see in Q1 because the exposure measure increases. That is more the on-balance sheet exposures. At the same time, it was partly offset by an increase in our pro forma Tier 1 capital. Okay, cool. The next question comes from Giulia Aurora Miotto from Morgan Stanley. Please go ahead. Yes. Hi, sorry for coming back on the queue. I thought it's an efficient, short call, so maybe there is space for a couple more if everyone else has been answered. On the restructuring costs, I was a bit surprised that these have been moved mostly to 2027, 2028. I don't know whether to interpret that as, number one, well, maybe it's actually cheaper to achieve what you set out to achieve, and so you just keep them there, push them forward, but maybe ultimately they're not gonna come, which is something that some other banks are hinting to thanks to AI, or for some reason, I don't know, you're going more slowly on the internal FTE reduction, and therefore these are gonna come more in 2027 and 2028. Then, a second follow-up on this mortgage, floor, which is coming out. My understanding on this floor is that it was put in place for essentially to make sure that the banks already think about the output floors, right? Because the output floors can be quite impactful, on mortgages. If we remove it, but you write a 10-year mortgage today, which has a 10 year, you know, which matures in a time where when you already have the output floors, in theory, you should sort of price the same. I was a bit surprised that, you know, you said, well, yes, potentially the pricing, adjusts. I don't know if you have any thoughts on that or maybe this is an indication that, the output floor is not gonna come through. Thank you. Thank Thank you very much. No, you can Absolutely. I will let Ferdi answer your question on the output floor, but I think based on also on our, you know, last, report disclosure, you can calculate it, but Ferdi will lead you through that. In terms of, you know, restructuring costs, what we shared at our CMD is that, you know, we had a total of roughly EUR 400 million over the course of the plan. We already took, you know, around EUR 100 million in 2025. We indicated this, you know, at Q1, you know, out of the EUR 63 million we are booking at Q1. This is primarily related to the integration of HAL. This is, you know, this is most of what you would expect. I think we, you know, gave you fairly good indications of where you would, where you should see these restructuring charges impact over time. They are the reflection of, you know, us implementing quarter after quarter our strategic plan and for this quarter, primarily the integration of HAL. Ferdi, on the impact of the output. Giulia, on the output floor, I have what I made in my comments earlier that there's structural overlap in all the different buffers. The Dutch mortgages floor was put into place for potentially systemic risk in the housing market in the Netherlands by the dependency or the big part of mortgages on the balance sheet of banks. There was clear overlap with the countercyclical buffer, which is 2% in the Netherlands, which is also a releasable buffer. If you look at the phase-in period of the output floor towards 2032, we have said earlier, specifically for us, that will not have any impact, the biggest result of this is clearly that for the biggest part of non-retail, we are on standardized. Yes, there's quite a gap between the full phase-in of the output floor versus the RWA we're currently reporting. Arguably, that buffer is getting smaller with the discontinuation of the output floor. For us, there's no impact in the thinking of the DNB. There might also have been some part of thinking in that with the full phase-in of the output floor is an additional prudential lever for potential systemic risk. Got it. Thank you, very much. Thank you. I believe there are no further questions in the line. If that's the case, we want to thank you very much for your attention participating in this call this morning. Of course, should you have any further questions, our Investor Relations team is as always, at your disposal. Have a very good day.