Good afternoon, ladies and gentlemen, thank you for joining on this call at short notice. I am Zubair M Chaiwalla, Head of Capital Management and Investor Relations. This meeting is being recorded. On the call, we have Joseph Abraham, the Group Chief Executive Officer of The Commercial Bank, Rehan Khan, the CFO, as well as Fahad Badar, EGM, International Banking. You will be put on mute for the entire duration of this call when the speakers are speaking. I will get back to you for the Q&A. Joseph Abraham, over to you, please. Thank you, Zubair. Good afternoon, everyone. Thank you for joining us today. The objective of the call today was to give you some background on the announcement that was made this morning about The Commercial Bank's offer to the shareholders of NBO to acquire a maximum of 15.2% of the shareholding, which would, if successful, take us to a controlling interest of 50.1% of NBO. The background to this is, as you know, during our analyst calls, I've always said that we are long-term investors in both Turkey and Oman. This is a continuation of that approach. NBO is a very good bank with a very good franchise in Oman. Therefore, we see this as meeting our strategic objectives in terms of the strong links between Qatar and Oman, and also having a stake in a strong bank with a very good franchise. The reason why we would like to go to 50.1% is that we believe strategically, and I'm a firm believer, that it is always better if you're going to make overseas investments, to have a controlling stake for a number of reasons. Most important over that is to ensure that the appropriate controls, risk management, and other good practices are made, and there's alignment across the two entities. Also to leverage the cross-border trade flows, investment flows. The combination ripe for overall better management and better risk profile of the entity. That's really the rationale for this. I would point out that this is an offer to the shareholders of a maximum of 15.2%. The Commercial Bank has the right, if that level is not achieved, to withdraw the offer, or it can keep what it has received. I would say that this therefore depends on the response from the shareholders, which will be known after the closure of the offer period, which is in early July. I'll now hand over to Rehan, who will give you some color on the actual impacts it'll have on capital and other financial metrics, if it is successfully executed by appropriate response from the shareholders. Rehan? Thanks, Joseph. Look, NBO has been a very good investment for us over the years. We initially invested in 2005. We have on average around a 10% return per annum on that investment and an average yield of about 5.3% over that period. It's been a successful investment for us. As with this announcement, it will go from an associate to a subsidiary. We would expect to be consolidating from Q3 onwards, subject to successful completion of this transaction. The offer is at OMR 0.2 per share, which equates to QAR 490 million. This would be a cash payment. The impacts we will see is approximately a QAR 200 million per annum increase in profitability on an annualized basis. There will be a capital impact, initially of about 1.1% on CET1. We will expect to build that up over a year to 18 months with the profits retained/dividends paid out. In terms of balance sheet, this will equate to approximately QAR 30 billion of increase in assets, total assets of the bank, post the completion of this exercise. We don't expect any impact in terms of immediate from a P&L point of view in terms of the associate becoming a subsidiary. One of the side impacts of this, we've talked about in previous calls, that we've set aside QAR 400 million for impairment. One of the impacts will be that there will be no impairment, as it moves from an associate to a subsidiary. We've been working with our auditors over the last couple of months on this transaction, making sure we fully understand and appreciate all the implications. That's one, not the reason why we're doing this transaction, but one of the side effects of this transaction. As you know, once an entity becomes a subsidiary, a purchase price allocation exercise is done. That basically determines the fair value of the asset that you're purchasing versus the price that you're paying for it. Based on that, the intangibles are amortized over a period of time. That will be established once the transaction is completed and an independent is listed to do that exercise for us. Hopefully that gives you a little brief on that. Take it, you will see the raise and see the three dots on the right below, which is written more. If you click on that, you will see the raise hand feature. If your name is announced, please unmute your device, state your name and organization, and ask your question. Once your question is answered, please mute yourself to allow others to ask their question. Let me just pause for a moment. We do have our first question now. Rahul Bajaj, please unmute yourself and go ahead and ask your question. Hi, gentlemen. Thanks for allowing me to ask the question. I have a few actually, so I'll go through them one by one. The first, as Rehan just mentioned, that the QAR 400 million number that you previously guided to for impairment for 2021, the upper end of the guidance, will not be applicable now. Just wanted to understand, does that mean that there will be no impairment from the U.A.E. business as well, so that QAR 400 would not be applicable at all? Or there could be something coming in from UAB, which is maybe already baked in that QAR 400? That's my first question. The second question is around areas for improvement. Joseph mentioned about aligning of risk, and several management sort of initiatives between the two banks. Just wanted to understand from a kind of numbers point of view, where do you see the most areas for improvements in terms of synergies or profitability expansion? I was just looking through some of the recent financials for NBO and I kind of realized there are areas where, probably CBQ's full control could help the business. Just wanted to understand what your thinking is around that. My final question is not related to NBO, actually UAB. Now that both your international operations are kind of, if the transaction goes through under full control, what would be your kind of outlook or kind of thinking around the U.A.E. business, which has been kind of struggling in a while and you've never said that that's core to you, so I just wanted to understand what the latest thinking is now. Thank you. Thank you, Rahul. Let me answer those. Firstly, in terms of impairment, UAB will still be subject to an impairment exercise that will be done Q3 stroke Q4 of this year. NBO will not be part of that once this transaction is completed. UAB will still be subject to that. That will still need to be assessed. Certainly, we expect QAR 400 to be excessive in that case. Certainly, there will be some impairment we expect to happen on UAB. As far as your second question on areas of improvement. Look, NBO is, as we said previously, a strong franchise, has delivered good returns for us. We see areas of improvement in terms of low cost income ratio for a start, will be an area where we will focus on just having that controlling stake now, I think will help us deliver on some of those key areas for NBO. Their cost income ratio is just over 50% right now. We expect to help the NBO drive that down. They're looking very seriously at their retail franchise, and that's something I think they will work hard on over the coming periods. Also on cost of risk. I think that's something where last year they've taken increased provisioning, primarily as a result of the pandemic. We expect that cost of risk to start coming down over the coming periods as well. I think lots of areas where we can help them and where we expect NBO to achieve growth and improvement in their financials. I think your last question was on outlook for UAB. UAB, obviously, the first quarter you've seen, they've made a modest profit. We expect that turnaround to continue over the coming periods. We're working with them on their own five-year plan. Of course, the fact that we have taken those impairments over the last couple of years, means that the fair value, and the book value are much closer to each other now. That means that all options are available to us. We'll see how that develops over the coming periods. Just again, Rahul, to just reiterate what we said and discussed earlier. We spent a lot of time working with the UAB team, they've cleaned up. As Rehan says, the first quarter showed a small profit. We expect, and that's the focus of our attention, to really continue to turn around UAB and work with the teams there. That said, we had written down the value of UAB, therefore, as I had said earlier, this gives us a little bit of flexibility. It's not our prime objective, but like I said, if someone came and think this gives us that flexibility to look at it because it's much closer to stock valuation. Very useful. Thanks, Rehan and Joseph. That's all from my side. Thank you, Rahul. Our next question is from screen name JM. Can you please state your full name and organization, unmute yourself and ask the question. Thank you. Hi. Thank you, gentlemen, for the presentation. This is Joice Mathew from United Securities in Muscat. I have three questions. I'll just go one by one. This is regarding your pricing of the offer. Your offer is around 25% discount to NBO's current book value and possibly a higher discount to the forward book value. If you're looking at the peer valuation, other banks like Bank Muscat, Ahli Bank and Magnus are trading at similar valuations. The question is, why didn't you consider offering a control premium when you were offering to acquire a controlling stake in the bank? That is the first question. Second question is that I think you have already had discussions with the other major shareholders who own almost 40% of the total NBO stake. There are four shareholders who combined own 40%. Do you have any feelers or indications from them regarding their participation, and any feelers on their reactions to the offer price? The third question is, what will happen if you're unable to obtain the targeted 15% shares? Will you be considering a higher bid or will you completely cancel the offer? Yeah. Thank you for those questions. In terms of the specifics of the transaction, of course, we cannot get into that kind of detail, nor what the large shareholders may or may not do. As outlined regarding your third question, of course, The Commercial Bank has the right to withdraw at any time during this transaction if it doesn't look like it will be successful. We have some options going forward on this transaction, but obviously the information has just been released, we will see how the reaction is over the coming period. Thank you. Thank you. Our next question is from Chirag Ghosh. Chirag, please go ahead. Thanks for the call. Just one couple of quick questions. The first one is related to the Oman business per se. We want to get a sense, are you optimistic on the Omani economy per se? Or you just saw it as a good opportunity too? What is the strategy behind this so much? Secondly, extension of Rahul's question previously asked. Is there a possibility that in future you might even look at taking a more than 50% stake in UAB? These are my two questions. Thank you for that. As we have said before, Chirag, that we are long-term investors in two countries, Turkey and Oman. This is a continuation of that strategy. The reason that is is because there are very strong strategic links between Qatar and Turkey and Oman. There's a flow of investments, trade, which we anticipate will continue to grow and increase over the years. That is why we are long-term investors on Oman and Turkey, despite what may be some current economic challenges. We remain positive on the long-term outlook for both these countries, and as investors, and we are comfortable with this position that we will have or will develop after this offer. With regard to the point about UAB, as we've always said, this is a long-term. We have a position in UAB where we are comfortable with where we are. Our continued focus is on actually improving the performance of UAB, and that will continue to be the focus. We don't see any increase in stake as an immediate opportunity or a priority. That's promising. Thank you very much. Our next question is from Vikram. Vikram, please go ahead, unmute yourself. Thank you for the call. My question is on the carrying value. The carrying value of the NBO investment is higher than the offer price that you made. Shouldn't that lead to a revaluation of the carrying value and therefore an impairment going to the income statement? No, Vikram. As I said, we have had extensive discussions with our auditors. The way the accounting works when an associate becomes a subsidiary is there are two independent transactions. One is effectively a sale and the other is effectively a purchase. The purchase is regarded as a bargain price and the sale is on the carrying value. They actually net off, is what we have seen on the various scenarios working with Ernst & Young. There's no immediate impact at all for this transaction when an associate becomes a subsidiary. As I did say, though, that there is a purchase price allocation exercise. That is done subsequent to the completion of the transaction, and that will show what amortization, if any, we need to do over a period of time on the intangibles. We did this exactly with Alternatif as well. Right. My second question is on the capital impact. You said that this transaction will have a capital impact of 120 basis points. Is this a cumulative capital impact? Does it include the combination of higher goodwill, higher risk-weighted assets, and everything else which comes from this transaction? Yes, Vikram. There is an impact on capital as we take on the RWAs of NBO onto our balance sheet. Initially, that will be a 1.1% impact on our CET1, 12% that we have currently goes down by 1.1%. That gets built up again as profits are recognized over a period. There is an improvement on return on equity on an annualized basis of about 0.3%, we expect that the CET1 will be brought back up within one calendar year to the level that has been decreased by this transaction. All right. My last question is on the dividends. The dilution of the capital, which is going to happen in the near term, does it have any impact on the way you're thinking about dividends for 2021? Dividends are finally a decision of the board, but as we've always guided, we have a sort of objective of paying out no more than 50% of earnings as dividends, there's no change to that approach. All right. Thank you. Thanks, Vikram. Our next question is from Ahmed Abdel-Rahman, from Ajeej Capital. Please go ahead, Ahmed. Yes, hi. I still can't seem to understand how there will be an impact on CET1 by 1.1%, while there's no immediate impact from reclassifying the associate to a subsidiary effectively. The way I understand it is the associate is being taken at 100% risk-weighted asset. You're consolidating both bank capital, it's going to be an aggregate of these, the impact should be positive, unless there's an impact from the associate itself being written down or reclassified lower. Can you just walk me through exactly how that 1.1% drop comes into place? Yeah, Ajeej. Actually, the way the accounting works for an associate is fairly complicated in terms of the impact both at CET1 and at Tier 1. We're happy to take you through the calculations offhand. Basically what happens is that associates comes out, but the impact of NBO's full RWAs comes into the balance sheet of The Commercial Bank. That's why there is an overall impact of 1.1%. We can show you the calculation, walk you through that on a one-to-one basis. Yeah. If you can send me just a quick overview or rundown of the calculations, that would be okay. Sure. Because the associate comes at various lines, you see, whereas the RWAs only comes in at CET1. There'll be a difference between total capital and CET1 as an associate and total and CET1 as a subsidiary. Right. All right. Well, thank you, and good luck on the transaction. Sure. Thank you very much. Thanks, Ahmed. Our next question is from Edmund Kristo. Please go ahead and ask your question. Edmund, can you unmute and ask your question, please? Can you hear me now? Yes, we can. Okay. This is Edmund Kristo from Bloomberg Intelligence. My question is regarding the PPA exercise. Clearly, there will be goodwill, and my understanding is goodwill can be used to improve the NPL of NBO. The NPL is around 5.5%. There will be some cleanup to the book. Is it correct to expect after the cleanup the cost of risk to improve for the new entity? This one. The other one is what type of revenue synergy we should expect from the cross-border transaction or the trade flow happening between Qatar and Oman? Where do you see the revenue synergy coming through? The last one is, your CET1 will be a bit soft after this transaction. Does it have any implication on the strategy that you are running in Qatar currently? I understand you are de-risking real estate, improving your exposure to government. Do you see any hinder in term of growth locally because of the CET1 impact? Thank you. Thank you, Edmund. Let me take that. First of all, NBO is also in It does have a five-year strategy of its own, which it completed formulating last year. They have a new CEO, new CFO. They've been working on that five-year strategy, and that obviously projects various improvements over the next few years, including cost of risk. That will help bring down the NPL ratio of NBO itself, and therefore of Commercial Bank on a consolidated basis. Your second question, in terms of trade flows, that's at so many different levels, and maybe I can ask Fahad to talk about that in a minute. Just on the CET1, we're obviously comfortably above minimum levels. We don't expect any impact on growth that we have factored in at Qatar or at any other level because of this transaction. We expect to continue, in fact, as you will have seen from our Q1 results, our net interest margins are improving as we still are moving into more and more government business. We expect that to continue. That is not harming our net interest margins at all. In fact, we see that trend continuing going forward as well. I don't think there will be any impact in terms of our growth aspirations and projections as a result of this transaction. Just going back to the trade flows, Fahad, would you like to comment on that? We have been already working very closely with National Bank of Oman in the past as an associate in terms of capturing trade flow between Oman and Qatar. I think with the stake increase, if successful, this will increase the interaction between us and National Bank of Oman overall. Both governments of Qatar and Oman have very close relationships. We see that to be increased with the success of the acquisition. Thank you. Thanks, Fahad. Thank you. Thank you, Edmund. We do not have any more questions now. Joseph, any closing remarks? Thank you very much for joining us. As always, Rehan and team are available for any further clarifications. Thank you for joining us today. Wish you a good afternoon and weekend. Thank you. Thank you. Bye, everyone. Thank you.