Good afternoon. Let me welcome you. I would appreciate it if you could mute, as we hear somebody's background. Again, let me welcome you and follow up call following our Q2 results. We have quite strong team on our side with Jakub Niesłuchowski, who will take majority of questions, and Piotr Bujak answering our topics concerning macro. As usual, we suggest to go straight to question-and-answer session. We have the formal presentation three hours ago. We are ready for your questions. Gabor, please. Yeah. Hello. Thanks for the call. Can we confirm your messaging on net interest margin, please? Yeah. What I gathered from your comments earlier was that it is in a positive trend, and you see possible upside going forward. If you could confirm that and elaborate. Just on the Q2 dynamics, this 4 basis point expansion in the clean NIM, can you elaborate on what drove that? I noticed a drop in your hedge derivative costs. Any further color would be useful. Thank you. Jakub, if you could. Yeah, sure. Hi, Gabor. Hi to everybody. Just to confirm and maybe reiterate how we see the NIM going forward for this year, because for this year, what also Piotr indicated, we assume that our interest rates will be at 3.75%. With this assumption, and we work with this assumption, in the context of NIM, the adjusted NIM for second quarter, as you saw, is slightly higher. This 4 basis points higher than in the first quarter. For the next two quarters, we see that we are now in the stabilization phase or period of NIM, as I look in the context of next two quarters. So it might be slight changes of NIM. I refer here to 4.3, so these adjusted levels, by few basis points. So not, I would say, very significant moves. So here I will call maybe stabilization. In this context, what we commented, also management board commented, we expect that the NII will be flat with positive upside for the whole year of 2026, in comparison to 2025, due to stabilization of NIM and growth of our balance sheet. So this how we see going forward for the third and fourth quarter, NIM around the level which we had, adjusted level which we had for the second quarter, maybe with some changes by a few basis points. In the context what you mentioned and asked actually, the change of adjusted NIM in the quarter. One is, of course, volume growth, and further optimization of deposit base, as you also seen significant decrease of cost of hedging. So these are, I would say, the main points which allow us, or areas which allow us to increase the NIM, adjusted NIM quarter to quarter. Understood. Thank you. Darek, we have- Sorry, Łukasz, you were the first one, please. Yes. Thank you very much. Good afternoon. First of all, congratulations to the results also for the volume growth. I have a couple of questions. Maybe I will ask them one by one, if that's not a problem. First one on volume. Again, I think this question has already been asked today, but very strong volumes, double-digit growth this year is almost certain. The question is: what are your expectations for the next couple of quarters? How much do you think, in terms of corporate lending, how much of this growth is related fully to these EU funds, safe funds, and so on, and how long can it last? For how many years? What is the second-round effects on, for example, smaller companies? Because I guess material part of the demand currently comes from larger companies. Generally, volume growth over the next couple of quarters and drivers. Here, maybe I will ask Piotr first to comment Yeah from the general market perspective. We see growing demand in all the segments, actually. Recently, at least in our books, there has been double-digit growth in all the segments as regards corporate lending. We believe it may be continued going forward, and it is not related only to utilization of EU funds and the growing crowding-in effect instead of crowding-out effect that was visible earlier. There are other factors driving investment activity in the Polish economy stronger, other than utilization of EU funds. We believe it will last maybe not only for the next few quarters, but even for years. We also see cyclical recovery in Western Europe, in the Euro area. Monthly data for the last few months from major European economies have been encouraging, so we believe that key export markets for Poland will be doing better. We also believe in cyclical recovery of investment activity in the private sector in Poland. We see many reasons to expect continued solid, at least high single-digit growth of corporate loans in Poland over the next few quarters or even years. We do not think it is related only or mostly to utilization of EU funds. Please remember that the Recovery and Resilience Facility for Poland, availability of the Recovery and Resilience Facility for Poland will not end by the end of this year. The loan part of the Recovery and Resilience Facility will be still utilized beyond 2026, and there will be some additional funding needed for projects co-funded by the loan part of the Recovery and Resilience Facility. So we do not expect any sudden stop of the lending activity in the corporate segment. On the contrary, we think that even with somewhat lower annual growth rate for total investments in the Polish economy that we expect for this year, 10%, for the next year, around 2%. Even with such lower growth rate for total fixed investments, we believe corporate loans may be growing at least as strongly as this year. If you look also what Piotr actually showed you during the conference at page number eight of our presentation. The corporate lending for next year is projected for 6.5% in comparison to 6.8% for this year. There is no, I would say, major change in this context. If you look on our activity, we cross, when we also showed 17% market share financing for corporate customers. Also in the context of our strategy goals, we have appetite for more. For sure, it is also one of our priority, as we also indicated during conference. We want to balance our activity between retail and corporate. For sure, there is also attention and focus on the corporate to not stop. What is, of course, encouraging on our side, it is very high increase year-to-year of investment loans, which were also shown in the presentation. For the large corps, not the biggest one, but large corps is 35% year-to-year. It is very significant. This also allowed us actually to have such significant growth of corporate lending year-to-year. Yes. Thank you very much for this. Second question is on net interest margin. Correct me if I am wrong, but you have assumption of interest rate in Poland next year at 3%. Is that right? Yes. For the next year, yes. It is correct. We assume that after the transitory increase of the inflation rate later this year and in the first two months of 2027, later on, inflation will quickly go back to the target of 2.5% and even below in the second half of 2025. That is why we think that contrary to what the market is pricing in, if you look up FRA curve, the Polish Monetary Policy Council will not hike rates later this year or in 2027, but will resume rate cuts in the course of 2027. We assume 3% rate cuts of 25 basis points each, starting from May 2027. We believe, again, contrary to market expectations, that the risks to this scenario are tilted to the downside. We do not expect that the Polish MPC could consider a single rate cut as soon as in September this year at the nearest meeting before the wave of inflation increase in later months of 2026. That is our view on rates. Baseline scenario is 3% rate cuts. By 75 basis points in total in the course of 2027, driving the reference rate to 3%. Okay. In that scenario, what would be your NII at the end of the period? What is your current sensitivity, whether it is higher or lower than it used to be? Also, given the fact that you quite significantly reduced the cost of deposits at the end of the quarter. Yeah. Okay. First, in the context of our sensitivity, what we actually show and present is static one, meaning for one-year horizon. In the second quarter was PLN 488 million. Please remember that is static and shift by 100 basis points. Now we are starting the process of planning for the next year, 2027. Assuming what Piotr said, and forecast, that we will go down from 3.75%- 3%. Of course, there are many variables here. On the one-hand side, what will be positively worked is hedging. If you look from, I would say, nominal point of view, over 50% of our balance sheet is hedged. Natural hedge in the form of mortgage loans, now even consumer loans, securities, and also hedging with derivatives. Of course it will work positive. For now, what I can say is if we will have this 75 basis point guide in 2027, we still see the margin will be above 4% in 2027. Understood. Thank you very much. Last detailed questions on the second quarter results. First is on personal cost. The headcount is up 2% year-over-year. HR costs are also 2% year-over-year, which means that basically the average salary is flat. Is it related to, I do not know, no hikes this year or some other bonuses assumptions? What is the expectation for the second half of the year? What we actually, from few years, introduced to be, from the also employees' point of view, more predictable from the management point of view, yearly revision of remuneration. Of course, always the scale depends on the many variables, but it is also perceived for this year. Actually, we are now in the middle of this process. What you can expect, starting from end of third quarter and then fourth quarter, increase of personal expenses, also due to the verification of remuneration of our employees. Thank you very much. Last question from my side is on provision releases in mortgages. It was the seventh consecutive quarter with releases here. What is the outlook? Do you still have some kind of ammunition here to release the provisions? Actually, it is hard to, I would say now, predict, because it is not necessarily, I would say, planned that each quarter we will release provisions there. It also will depend on the performance of the portfolio. That is all from my side. Thank you very much. Krishandra, please. Thanks for taking my question. I have three, and I think the last one would be pretty straightforward and simple one. Just starting with the corporate side of the business. Just trying to understand, your loans are growing at a rapid pace. In last few quarters, your customer deposits are not growing in the same vein. Is it part of optimization, or that is also kind of helping the NIM? That is one. Second, just on the mortgages side. I understand in March and April, there was huge influx of refinancing of loans, which the data was suggesting. In a sense, what is the trend that you are seeing in terms of fixed versus variable rate? What you are seeing, and what is the margin trend? In a sense, how are you seeing margins in that product? Lastly, just if you can confirm, I guess, on the call, Chief Financial Officer, I think at last was talking about cost guidance for this year. If you could just repeat that would be pretty helpful. Right. Going to the first question about the corporate lending versus deposits. Where is our focus? Our focus is, on the one-hand side, on the asset side, retail, two main products as mortgages, consumer loans, and also corporate book. Then on the liability side, looking also from the angle of our strategy goal, individual customer savings. As you can see, we grew our market share predominantly on the liability side, on the retail deposits, on the asset management business. This is our focus. On the corporate side, we don't fight for deposits. You rightly spotted, we don't want, in this segment, fight with price for the deposit because there is no need. If you look from our LCR point of view, loan-to-deposit point of view, there is no need actually to increase the prices and fight for deposit. As a matter of fact, also you rightly spotted, it's positive from the NIM perspective. We don't have just to end any fixed goal, how much in the context of the market share we want to have on the corporate deposit side. It's rather balancing volume, meaning if we need more, we are able to go to the market and gather more deposits if there is a need to do it. Sure. Just one small follow-up before you go to the mortgage question. Just looking at the investments you had presented, thanks for presenting that investment loan year-over-year growth. I guess just trying to look from the corporate deposit perspective, if those loans are growing faster, would that mean that deposit base for the corporate would not grow as fast as it has done in previous years? Or do you think those would not be related in some sense? I would say it might be that case, because it also depends how much our retail deposit base, which is actually largest share of our deposit base, at what pace will the retail deposit base will grow, which these deposits are more sticky. So in this context, we prefer to have retail deposits than more, I would say, variable corporate deposits. So on the liquidity side, we are on the safe side. Still having, I would say, a large buffer of liquidity, which we can also use for further lending next, of course, to our very good capital position. But again, if there will be need, we are able actually also to gather and increase levels and shares on the corporate side. Second question was, if I catch correctly, it was about fixed and floating loans in our loan book. Yeah, mortgage side. Specifically on the mortgage side. On the mortgage side, if you look end of second quarter on our loan book, we had 47.4% of loans which are based on initial fixed rate for five years. In the context of sale, in the second quarter, it was 63% new sales based on mortgages with initial five-year fixed rate. Is that Yeah. You have answered it. Just a follow-up. Was on the margin side, I think, how we are looking at the margin spread on the product actually as whole. Because on the call, I was hearing the Chief Executive Officer, Chief Financial Officer, and they were talking about you are not that keen on refinancing. You are looking at your customers more rather than refinancing from the other banks. So just trying to understand the spread in a sense, like trying to look at broader picture on the ROE. So if you could briefly comment on that. Sure. Indeed, our refinancing level is lower than, I would say, market average, and numbers also showed by part of our competitors, at least they actually told what is the level of the refinancing. Here we also, what is important, leverage our presence, not only in big cities or biggest cities, but also outside big cities. We can actually limit, here especially on the retail side, the pressure which are on the loan side, if we talk about the mortgages. Of course, there are banks which are now fighting for regain their market share. One of example is Millennium. They, for a long time, had their challenges with capital. Now they are back on the market, and we see that they are growing our market share. But also others, like mBank, like ING, and they actually, in some cases, propose customers very low margins. We are not there. We are not fighting. Of course, we are actually adjusting our pricing dynamically. However, it is more about, in our case, structure of the sale, because we want to have more fixed rate loans, meaning initially fixed rate loans, because it is natural hedging in the context of interest rate risk. We actually adjusting, I would say, margins between floating and fixed, just to have the structure of the new sale which we want, rather than competing with extremely low margins sometimes proposed by our competitors. I am sorry, the last one, just on the cost, I think it should be very brief, actually. It was actually told during also conference. Looking at current dynamic, we see it is mid-single digit, maybe skewed towards slightly mid-high single digit. However, due to, for example, what I already mentioned, a revision of remuneration. We can expect that the personal costs will grow in next periods. Yeah, thanks. Krzysztof Dresler, good afternoon. I can add here that we will continue initiatives connected with the development of the bank towards targets specified in the strategy, and of course, we keep high discipline in business as usual cost connected. Gulnara, please. Hi. Good afternoon. Thank you for taking my questions. I just wanted to follow up on the competition. Have you seen any material shifts when it comes to Q2 compared to Q1 and at the beginning of Q3? Because some of your peers mentioned their spread compression on the corporate side. When it comes to the competition, where do you see the greatest competitive intensity? How PKO BP is responding, especially when it comes to the corporate and household lending? Maybe a follow-up on the capital allocation. As the volume momentum continues to remain strong, how should we think about the capital allocation going forward? Should we expect the dividend payout to be towards more the lower end of your range, potentially closer to 50%, or would it be fair to expect it to be somewhere in the middle at the full year results? Thanks. Okay. Maybe let's start with the second question first. On the one-hand side, for now, we don't change what we communicate, that we see the payment levels between 50%- 75%. Each time, it's dependent on first, Polish Financial Supervision Authority dividend policy. We actually receive it usually in December. This year, for the next year, we'll receive the general policy in December, and then individual policy most probably in February. Sometimes Polish Financial Supervision Authority is changing, for example, the conditions for the payment of the dividends. However, we, in our capital management, we want to be able to pay out the dividend. This is actually our main goal. Also in the context of capital buffers, we actually look not only on the minimum levels, but also on the dividend levels, and we keep buffers over dividend levels. But maybe also comment in this respect. After increase of countercyclical buffer will take place by the end of September this year, the minimum regulatory levels will be the same as the dividend payment levels. Polish Financial Supervision Authority may be tempted actually to increase the dividend payment levels of TCR, Tier 1 ratio, and CET1, to actually be higher than the minimum regulatory levels. However, we also work to be prepared for such scenario. As you can see, we are actively managing our capital position. We already actually included this information in our presentation that we printed Tier 2, our first in our world, Tier 2 in Europe. Today, we received the information and approval for Polish Financial Supervision Authority to include this instrument in our capital, which is good news and pretty short period as for Polish Financial Supervision Authority for such approval. Plus, we did securitization. Also in this context, it's not our last word. We see securitization and also capital instruments issuance as our regular tool of capital management. In this context, actually, we for sure want to keep our capacity to finance our customers and economy and also pay out dividend, and be able to pay out the payout dividend. For now, it's too early to tell you and indicate what will be the exact percentage, taking into account that we still don't have a Polish Financial Supervision Authority policy, unfortunately. I would like to have it now. Plus, of course, now we are just starting planning for 2027. We'll see what will be the volume growth, how much we can and want issue and capital instruments if needed, do securitization, and then we'll see how much we have in the context of potential dividend payment. For now, it's too early to be within the range 50%-75%. I believe Krzysztof would like to comment. I can add only, Gulnara, that of course, finally, it's a voice of the shareholders, and you will decide finally what is the precise number. Even if we assume something in the middle of the corridor, we have to be ready for maximum payout ratio, taking into account, as an example, the budget deficit and things like that for the next year, forecasted by Piotr of 6.7%. That's why even if we assume in the main scenario, something in the middle, we have to be ready for the maximum payout due to professional assessment. of potential needs on our shareholders. Gabor, I believe you have additional question. Jakub. Yes. Thank you. Sorry, question about the competition. Yes, sure. Indeed, we see the competition, I would say, especially on the corporate side. From my perspective, the biggest competitive change in the last, I would say, quarters is that two banks actually are back on the market. Here, I mean Bank Millennium and mBank, after some years of working with their capital position, especially. That's visible. They are competing actually now, and it's predominantly also visible on the corporate side. There are banks actually who are entering new segments, as for example, local government segment. Historically, it was BGK, so Polish Development Bank, which has the biggest market share, but then it was us and Bank Pekao S.A., second biggest bank. Now we see ING, Bank Millennium, Erste, for example, in this segment offering low margins, hunting volumes. This is actually visible there, which of course, impose some pressure. On the corporate side, we also see some pressure, but here it's sometimes easier because we look on the whole relationship with the customers. We are not looking only on the margin, but how much other business we can do with the customers. As for example, a cash management, treasury product, and then we are looking from the ROE on the customer. With local governments is more difficult because usually it's a tender and you have only loan as a product, without cross-sell. I already commented in the context of the consumer, sorry, retail customers. On the mortgages, we see that some banks are actually more active offering low margins. As you can see from their statements, they are even refinance in the context of new sale, refinancing is 40%. Which is, in my opinion, not, I would say, healthy. It's better to focus on the financing new needs of the customers, not refinance the existing volumes. But it's my point of view. There we see also some pressure, but as I indicated, we don't want to take, I would say, part in this, and go such low with the margins. We more balance the margins of the product between variable and fixed-rate loans just to keep the part of the initial fixed-rate mortgages at the level which we want in the context also of natural hedging of our NII. Thank you. Can you follow up on the capital benefit? What type of benefit in terms of the size can you extract from securitization? Maybe just to follow up, given you mentioned the budget deficit and the upcoming budget, what is your current outlook for the corporate income tax for Poland? Do you think they will stick to 26% for next year, or do you think there is a risk of potentially remaining at the higher levels? Okay. In the context of first tax, for now our base case is that we stick to what is already written in law. Meaning that we actually will be on the path to 26% for the next year, 23%, 28% and onwards, with parallel reduction of the banking tax starting next year. Of course, we see in the public domain voices about maybe increasing the tax, meaning go for 30% in 2027 and maybe onwards, but it's voices from the junior coalition party. However, this is also kind of view which we have is that most probably president will not sign it due to, I would say, election period next year. President, as you know, is from another or different political angle than current ruling coalition. Of course, we cannot be sure, but for now, our base case is that we will go with the path of the tax changes, which is already written in law. Securitization. For now, as you look, we did two transactions. From the TCR point of view, the benefit of current securitization is around 30 basis points. 27 basis points out of the new transaction and the original amount, or benefit from the first transaction as a pilot transaction it was 5 basis points, but this transaction is amortizing, so also the benefit is also amortizing. But now it's around 30 basis points. As we look from the European market point of view, the average level which we see it's around 50 basis points. Which European banks have out of SRT securitization. It's not, I would say, any hard limit for us, but I would say it's kind of indication which we have. On our side, we will plan securitization for also next year. The scale for now is hard to, I would say, determine, but we still have room for capital optimization at this angle, both on the corporate but also on the retail portfolio side, as, for example, consumer loans. Thank you. Gábor? Thank you. To follow up on capital, you mentioned various moving parts in the requirements. You have also been taking action. What do you view as your internal capital target at this stage? In relation to that, what is your view on your level of capital surplus? How we manage the capital, we are looking actually on the dividend levels, because we want to pay our dividend, then our minimum buffer is 100 basis points over this level. But of course, if we plan for in the next We usually look on the, of course, it's a financial plan, it's for one year, but we look at minimum in the horizon of three next years. We want to keep enough capital to be also able to finance in the context of capital allocation, of course, our volumes development, plus any regulatory actions still to be and comply with dividend levels plus at least 100 basis points. Now we are in the situation, as I mentioned, that we do not know, unfortunately, if Polish Financial Supervision Authority will increase the dividend levels after September, taking into account that the minimum regulatory levels will be at the level of dividend levels after increase of countercyclical buffer. That is why we are now using and developing on our side capital management tools to be able to react pretty quickly if something will change also on the regulatory side and react on the volume in the context of volume growth to actually keep the buffer which I mentioned. Thank you. Just to confirm the numbers here. 14.4% is the total requirement right now? Yes. For the 75 basis points. You want at least 100 basis point buffer? Yes. 15.4%. And on a pro forma basis, you are at around 17.8%. Is that roughly? Currently looking from our levels point of view, we are now at the group. We have it. 16.8% from TCR point of view. 14.4%, which you mentioned, is the criteria for dividend payment. We want to be minimum 100 basis points above this 14.4%. However, we expect that we, or Polish Financial Supervision Authority, can increase this level, meaning the dividend payment level. As you can see, for now, we have also a comfortable level of the surplus to accommodate it. However, in the context of new year, we for sure will plan another Tier 2 transaction and securitization transaction actually to keep a capital buffer on our side. Okay. 15.4% as it stands, which may change. On a pro forma basis- Yes. Y ou are at 17.8%, so you have 340 basis points of buffer? Adding securitization and Tier 2, then yes, you are right. Okay. Right. I mean, still a decent surplus. Yes. Here it is also preparation for potential increase of the dividend levels on our side. Okay. Got it. Thank you. Please remember, Gabor, that we have a significant portion of bonds in the balance sheet, and the evaluation, the sensitivity of evaluation is reflected in the capital. Now we have a positive, in the first quarter, negative. There is a negative. If we talk about long-term buffer, this 1% means that we should be over this 1%. If we look from the perspective of time, that we need time to add the capital from retained incomes or to go to with the issuance or securitization, it takes time. In practice, it means that this 100 basis points is a threshold internal one, which is the signal for us to do actions, but we do not keep only 100 basis points surplus because of these fluctuations and these time differences, and the need of time to really reflect in the capital instruments. Yeah, but also we are actively managing our, what Krzysztof mentioned, the potential impact of debt fixed income securities, which are, from the accounting point of view, their valuation is included through other comprehensive income. If you look on our securities portfolio, around 23% now is valued through fair value also. Rest is valued according to amortized cost. We actually also changing, including more instruments, from the accounting point of view, in the category held to collect, and value through amortized cost to limit the potential impact as we see it now of valuation through capital, and as a matter of fact then impacting all funds. All clear. Thank you. Mehmet, please. Hi. Thanks very much for your time. This is really very helpful. If I may just come back to the cost point for a second. I think I heard mid-single digit to high single digit outlook earlier. Please correct me if I am wrong. You mentioned the revision of staff remuneration and the continued initiatives within the strategy. Was this for 2027? Secondly, if so, how would you expect the second half of this year to look, given the first half is running at just around 1% year-on-year? The outlook which we presented, this was for 2026. We haven't given outlook for 2027. In general, I would say we are now in the period of normalization of cost dynamics, meaning after years of high inflation, and the double-digit growth of cost base, now we are in the single-digit territory. As we look now in the context of 2027, how much is too early to say, as we are ahead of our planning for 2027. For 2026, we still see mid potentially to high single digit. As we mentioned, one is revision of personal cost in the context of revision of remuneration of our employees. What Krzysztof mentioned is that, of course, we are leading number of strategic initiatives on our end, and this is actually priority. We are able to actually have slightly higher cost, but assuming we will have benefits in the future in the context of our business. Of course, as you can see also, we are more active on the marketing side, which is also one of the pillars, and supporting our volume growth. This is our actual also area which we actually increase our cost, but in the context of benefit on the volumes and the core revenue side. Okay. Thank you. Can I just confirm if there's a date typically for the staff cost remuneration changes? You mentioned you do this annually once. When does this typically happen? There is no, I would say, any fixed date, but usually takes place in the third quarter. Now we are, I would say, in the middle of this process. Okay. That's very clear. Thank you. Secondly, just on the CHF provisions, which are now coming down nicely. Consensus currently has PLN 1.5 billion approximately for this year, and that would imply a little bit of an uptick in the second half from the second quarter number. I don't know if you can guide on this, but I was just wondering if you would see this as reasonable or if you think the second quarter run rate, which is close to PLN 300 million, is what we should be working on as a base. So, in the context of further provisioning and to what I would say kind of consensus is PLN 1.5 billion, I would say on our side is data-driven. But if I look on this PLN 1.5 billion, it's reasonable. But if it will be PLN 1.2 billion or PLN 1.5 billion, for now, it's too early to say because, again, it's data-driven on our side. But for sure, we want on our side, and we believe on our side that it's the last year of significant CHF provisioning. Okay. Thanks very much. I do not see any further questions. Thank you for participation and hope to see you soon or in Warsaw, probably somewhere in Europe or U.S. Thank you. Thank you very much. Thank you very much. Bye. Thank you