Good day, and welcome to the TCS Group Holding IFRS Financial Results Full Year 2021 Call. Today's call is being recorded. At this time, I would like to turn the conference over to Oliver Hughes. Please go ahead, sir. Thank you. Hello, everybody, and thanks for dialing into our call today. Our original plan for this call was to discuss the great results that Tinkoff produced in 2021. We generated RUB 63 billion of net income and 42.5% return on equity. We grew our customer base by 57% to over 20 million total customers, and we solidified our position as one of the world's leading fintechs. Obviously a lot has changed since the end of last year. We at Tinkoff are extremely saddened by the recent turn of events, and we all very much hope the situation gets resolved quickly and that peace will be restored as soon as possible. Today, we'll give you more time to ask us questions. We want to give all of our investors and analysts a chance to talk to us regarding all of the matters of the day. Obviously, there's lots of questions in people's minds. While we won't be able to answer all of your questions fully because obviously the situation is evolving very quickly, it's very fluid, we feel it's very important to keep open communication channels with all of you, with all of the partners, investors that have supported us for so long overall. Overall we The subscriber is not available now. Please call back later. Hi. I assume that everybody can still hear me. Yes, we can, Oliver. Excellent. As you've heard us say many times before, we're used to dealing with crises. Just to remind you, we went through the 2008-2009 global financial crisis profitably. Obviously, we were very early stage back then. We went through the significant Russian crisis of 2014-2015 after the first wave of sanctions, when we went through the first credit cycle in Russia's history, the devaluation of the ruble, oil shock, banking sector crisis, liquidity crisis, et cetera, and we stayed profitable. We had the COVID stress test back in March 2020, and we stayed profitable and actually grew significantly all the way through 2020 and 2021. This is a very different crisis, and this is completely uncharted territory. As you know, our business model is very flexible, and we can withstand severe shocks. We have abundant liquidity in both rubles and foreign currency. We have very strong capital buffers, which have actually just been made even stronger by the Central Bank alleviation measures, which I'm sure we'll be talking about later in the call. We have a very high margin business with a very high variable cost base, which can be switched on and off, and a team of 40,000 Tinkoff employees and experienced managers working around the clock to make sure that our operations remain uninterrupted and that all of our customers, 20 million of them, continue to access, use, and transfer their funds. So far, our operations have been unscathed. On that note, I'll hand over to Pavel, who will give you some more detail on the current situation. Pavel. Oliver, thank you so much. Dear investors, as you appreciate the recent market fluctuations. Pavel, sorry. It's a little bit difficult to hear you. Hello? You're a bit faint. Yes, thank you, Oliver. There you go. Thank you so much. As you appreciate, the recent market dislocations and sanctions have taken us into fairly uncharted territory. As of today's call, our operations are running smoothly, and as Oliver said, we are continuing to serve our customers, remaining client-centric business at our core. The service agents are working around the clock to help customers with their questions and requests, and we have taken a level up our focus on customer service in this challenging and difficult times. However, from our side, we would like to note that despite the overall volatility, the business remains running as usual. We have not been included in any sanctions list. We and our customers are able to use SWIFT messaging system, and we may continue to plan should SWIFT one way or another become unavailable. Our customers' cards work both domestically and internationally. We have access to our correspondent accounts and have access to ruble and FX funds. As we speak, every day we're loading our ATMs with rubles and foreign currency to disperse cash to customers who want it. On the capital markets front. We remain committed to servicing our debt and to continuing the trading of our stock in one form or another. As you appreciate, the situation is evolving vis-à-vis London Stock Exchange, Moscow Exchange, but we are working hard and remain committed to staying a public company, making sure there is an exchange where our investors can trade the stock. We are giving all the necessary support and flexibility to our employees. This is one of our key competitive advantages, and in these difficult times, we are doing what we can to make sure that we stay focused on the results and on making sure that bank operations continue uninterrupted. As you appreciate, we have the trust of our existing customers and the trust for incoming customers. We're in constant discussions with the regulators and our commercial partners. Additionally, I would like to comment on the measures that the Central Bank and the Ministry of Finance have introduced to provide support to the banking system, among which I would like to mention specifically unlimited liquidity facilities for the banks. A second measure which is important is a hike in the key rate to 20%, that encourages customers to keep money in the banks. Thirdly, we saw the lift of direct caps on consumer loans that supports the ability of the banks to generate the net interest margin. We have also witnessed a reduction of risk rates on unsecured loans, which winds back years of macroprudential tightening and releases substantial capital to the banks. There are also additional forbearance measures on non-performing loans and revaluation of securities, which further help the capital efficiency of the banking system. We appreciate that the Bank of Russia has also introduced a number of measures on capital controls, which control the outflow of capital from the country. However, with the measures that are also partially focused on large export-focused corporates, we believe that there will be meaningful inflow of FX for export revenues in the country, which will result in support in the ruble. As you appreciate, we have put the business in a steady-state mode, and it's not happening for the first time in our 15-year history. At this stage, we have temporarily halted significant new lending. We have scaled back our paid customer acquisition efforts, and at this stage are focusing on safeguarding the capital liquidity of the firm. We do feel, as a firm, that we are prepared and ready to weather the storm. As during the previous crisis we have t hat we have overcome, we believe that this will be yet another opportunity for us to strengthen, adapt, evolve, while always remaining close to our stakeholders, customers, employees, investors, regulators, and society at large. Given the current level of uncertainty, we're not in a position to provide detailed guidance for 2022 until the external situation stabilizes. While we remain focused on making sure that we continue smooth operations in the Russian markets, we do continue to affirm our work that we communicated to the market a number of times over the last years on bringing Tinkoff to new markets. I think at this stage our presentation is over, and we're happy to take your questions. Thank you so much. Thank you. If you'd like to ask a question, please signal by pressing star one on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, that is star one to enter the queue for questions. We'll take our first question from Elena Tsareva of BCS. Please go ahead. Good afternoon. Thank you much for opportunity to ask questions and to have call. Maybe just kind of recent date days recent week of customer behavior. I don't know, maybe something in terms of delinquency rate or just I mean behavior of customers in general. My another question also lies in terms of your broker business as well, given like it's first real strong shock for this kind of the business. How this broker stands now? This will be my first question. Okay. Thanks, Elena. We have quite a few colleagues on the line. We'll be parceling this out depending on the question. I'll kick off on the customer behavior and what we see in the credit portfolios, and then maybe Neri or Ilya can take the brokerage question. On customer behavior, obviously, at times like this, you tend to see customers going into hard currency, into dollar. Hard currency is actually not a term that we've had to use for many years, but this is where we are. You see customers obviously panicking about banks in general and where they can keep their money safely. On the liabilities side, we've seen across the banking sector a number of things happening. The first is banks which have been sanctioned, obviously, seen some volatility and some outflows. I believe that is now calming down a little bit now. But we were actually, somewhat bizarrely, the beneficiaries, if you can use that word in this context, of some of that liquidity coming in because you know we're not a sanctioned bank, so we're under no sanctions directly or indirectly. I use the word carefully, but we're regarded as something of a safe haven where it's business as usual and service continues uninterrupted for customers. The second thing is obviously that people are going to dollars. We've seen a lot of customers wanting to convert, but actually the conversion from rubles into dollars are actually being really quite mild inside our existing deposit book and current account funds. It's been around 5% increase on what it was before. That's gone from something like 17%-18%, I think it's about 22%-23%. Colleagues correct me if that number's wrong, but I think that's what it is, before the effect of FX and revaluation of assets. It's been mild in our case, but obviously from other banking institutions, people have been converting their savings into dollars. Some of that has been coming our way. It's gone out through ATMs. We've actually seen quite large interest, quite a lot of activity queues around our ATMs on some days. It's actually people depositing rubles and dollars onto their accounts, not just withdrawing. There's been, you know, this weird kind of two-way movement amongst customers. Some people have been moving money between institutions, some people have been putting dollars back into their account. It's difficult to pinpoint one particular trend. Just on the liquidity side, while we saw a bit of movement around a week ago, we're actually now in a position where we're seeing inflows. Liquidity is actually increasing. On the loan book side, in the portfolio, we're not seeing any signs of delinquency yet. You know, as you'd expect in a situation like this, it's something that could well come. We've reduced, drastically reduced our lending in some cases practically to zero. We've reduced our cutoffs. We've got a very low tolerance to risk. There's obviously two reasons for that. The first is because we expect risk to be coming through as all of the problems which have been caused over the last 8-10 days start to hit the economy, which they will. That will obviously affect customers' ability to pay. Customer risk will go up. That's our expectation. The second reason is that when you have funding costs going up with obviously the key rate standing at currently standing at 20%, it makes it difficult to know with what economics, future economics you're underwriting or originating new business. In this, in these circumstances, we've taken a very conservative stance, as you'd expect. We've ratcheted down origination, closed some channels, and we'll be in this conservative bracing position for the foreseeable future until we understand how it's gonna pan out. At the moment, we're not seeing anything moving in terms of risk numbers. We're also moving resource from some of the servicing functions into collections just to make sure we're ready for whatever comes our way if something does come our way. That's the current position on the consumer side. Obviously there's a lot of uncertainty. Well, there was some panic. I think the mist has begun to lift a little bit and people have either sorted out their financial situation as far as they can at the moment and have, you know, transferred or done whatever it was that they had to do, converted. Generally things look a little bit calmer. Obviously as the situation evolves further, we could see some more volatility. Colleagues may want to add something to what I've just said, but if not, then let's go onto the brokerage answer. Hello. Ilya Pisemsky is on the line. I'll probably continue on the brokerage. Well, to be honest with you, it's difficult to assess the clients' behavior because the stock exchange is not working, so there is not much of the behavior that we see apart from the people who are converting rubles from their account into dollars for quite some time. Now we hear less of this because the Central Bank of Russia requested us to increase the commissions on conversion, and it became not that favorable to customers. In terms of new customers, yes, we see an increase in customer acquisitions. A lot of people were coming these days and opening new accounts. We'll probably see increased activity in our brokerage business as soon as exchanges are open. Thank you. Thank you. We'll take our next question from Andrew Keeley of Sberbank CIB, please go ahead. Hi, good afternoon. Thank you all for doing this call. It's much appreciated. I guess I have a question on technology, which is obviously such a critical part of your business. I'm just wondering, you know, if you can give us any thoughts on how you're preparing yourself, you know, if there should be kind of further cutoffs from the ability to access foreign technology services. I guess it's a slightly hypothetical question at this stage, but, you know, we've already had Apple pull out. Should you get the withdrawal of, you know, cloud services, software providers, Mastercard, et cetera, any thoughts on how you're kind of preparing yourself for that kind of situation? Thank you. Sure. I'll kick off again, Andrew, and colleagues can jump in. It's very difficult to answer your question, A, because as you say, it's hypothetical at the moment, and B, because for each area of technology or a specific vendor solution, there's a separate answer. Yeah, so you know, the permutations to this are really quite wide. What I can say is that since sanctions were imposed the first time back in 2014, there's been actually quite a lot going on in this whole space. We've actually had some vendors pull their solutions out of the Russian market, for example, Splunk, which is a monitoring system. Different financial institutions responded in different ways, but the way we responded was to build our own solution. We built our own solution called Sage, which we're actually selling to third parties. There's been time for the system, to a certain extent, to adjust and, for want of a better term, get its head around this. Obviously some things could be really quite disruptive if the plug is pulled on them as services in Russia in the coming days, weeks if it happens at all. For example, we think about contingencies for mobile apps not being available in the stores, in App Store and Google Play. If that happens, then we have alternative technologies, including web-based technology, which means that we can provide a service uninterrupted to our customers through internet banking and maybe other solutions which are actually mobile based. Obviously the internet bank works through mobile web. In terms of all sorts of other vendor solutions, our colleagues on the tech side have been thinking about this obviously night and day for quite a while. There are some things where we have responses in place, other things where we just have to think about, you know, the exact implications. Again, we'd just have to see how this evolves and exactly what measures are taken by different companies. In terms of the payment systems, including Apple Pay and Google Pay, we're completely functional because we're unsanctioned. As Pavel said in his opening remarks, all of our services are continuing completely uninterrupted. We have full functionality on that. We'll see if that continues, but there's, you know, no reason why it shouldn't. It's a very broad question. I think, you know, just to summarize, the answer is that in some cases, this, if you like, sword of Damocles has been hanging over us and the banking system in general for a while, and some mitigants are already in place. Some other stuff has been coming down the pike more recently, and the system has been thinking about how to counteract this. Obviously individual players who are leaders in technology, such as ourselves, have been on the forefront of that with their own individual responses as well. We'll just have to see how this plays itself out. I think we have answers to whatever comes our way. Colleagues? No, Oliver, that's absolutely correct. If I could just add, I think, I mean, this is a very open-ended question. Obviously, it will be very for contingencies, but I think what's more important, I think at this stage it's a bit too early to We ask the question for which we have no clarity on the direction of all the measures, those measures are to be implemented. I think at this stage it's open-ended, but we're obviously preparing. I think, you know, what I would mention is that, with close to 100% of our technology stack developed in-house and quite a bit of prepared technology we have on our own, I think we will be able to withstand the pressure. Okay. Thank you, guys, for your response. Just a second question is on, and I think Pavel did refer to this earlier, but I missed a bit what he said. Can you just update us on whether there's any implications in terms of your plans on the international expansion side, at the moment, or just, you know, what's happening there? Thank you. Sure. I'll leave that one to Pavel. No. At this stage, Andrew, we're obviously working. We're working as we specifically specified before, in a couple of markets in Southeast Asia. We're considering the opportunities, as we mentioned before. We're looking at, you know, one market in Latin America from the acquiring payment side. We have done tremendous amount of work on the ground in each of those markets over the last two quarters. I think we're bullish that we will continue without much of a change in terms of building our presence there. Essentially, I think the key point from our side is that it will not require that much of capital at this stage. We've always been very conservative in applying capital to these new geographies. If anything, I think what you will see in these markets in the coming quarters is number of experiments on the ground with credit products in first place. Actually what you might see as well is us entering into transactions to acquire banking licenses in some of the geographies, but again, you know, at very low cost, being very careful about our capital. You should see this as just simply us building platform for the international business of TCS Group as we have already discussed and presented to the market. Okay. Thank you, Pavel, and yeah, good luck to you all. Thank you. Thank you. We'll take our next question from Mikhail Shlemov of VTB Capital. Please go ahead. Yes, good afternoon, gentlemen. Thank you very much for hosting the call today. I actually have a couple of questions. The first one I would like to start with is actually how about brokerage business. Given that you are the dominant operator at the SPB Exchange, I wonder how you see the disruption which is currently happening in terms of settlement of Russian securities. Do they impact the SPB Exchange at all? Whatever you are thinking that the certain changes to the infrastructure are needed there, any update which you can provide would be very helpful. On the bank side, I wanted to ask about the way we should think about the interest rate risk unfolding, given that on the one hand we have a repricing of the liabilities given the higher interest rates, and on the other hand, Oliver mentioned a huge inflow of the new clients. What should be the sensitivity or how we should think about this risk unfolding going forward? And probably last but not the least thing, you have the subordinated Eurobonds outstanding. I know that you're not subject to any sanctions, you are connected to SWIFT, but could you please confirm that you're actually still able to sell this instrument? Thank you. Thanks, Misha. Yeah. I propose that Ilya takes the first question on interest rate risk, and then Sergei Pirogov can answer on the Eurobond, and if he's able to answer on the brokerage business in St. Petersburg Stock Exchange, then that'd be excellent. Thank you. On interest rate risk. As the rate was hiked, and right now we have increased the cost of our liability that we are paying. We've introduced a short-term deposits with high interest rate, and we increased rate on current accounts. But not to the extent where the prime rate is. We suddenly our SME business and current account business became on a long basis very profitable. Through in total balance sheet, well, the loan portfolio and the net interest margin will obviously have to go down because of this. As we're not lending right now, we are basically not losing much because we are over-liquid, and we basically keep this liquidity with the state. We basically overnight lending to the state at this rate. Right now we are net profitable, but the net interest rate will have to go down. That's true. Then we'll see for how long the situation will continue. Ilya, thank you very much for this. Could you perhaps elaborate, basically I know that the situation is extremely fluid, but still, what is the sensitivity of a net interest margin to the increase in the interest rate which has happened, given the recent changes in the balance sheet structure? Whatever you can share. I know obviously it's very fluid. Well, I wouldn't give you a sort of a specific number or percentage on that sensitivity. That's, I guess we'll have to evaluate and probably come back to you with the detailed analysis. Lovely. Thank you so much. Hi, Misha, this is Sergei. On your question about our perpetual Eurobonds, as Pavel mentioned at the beginning of the call, we remain fully committed to servicing our debt to the extent it remains legal and the infrastructure to do so continues to be in place. As of this moment, we have heard nothing from our service provider and capital markets infrastructure providers that would preclude us from servicing our March coupon payments. In fact, we have prefunded our coupon payments already and our paying agent has not informed us of their inability to distribute the coupon payments to the bond holders. We wholeheartedly hope that will be the case in the following coupon payments. We remember that back in 2014, when some restrictions were imposed on other Russia-related bond issues, the U.S. regulators did provide license specifically for debt service. At this moment, we don't have reasons to believe that they will deviate from this policy because otherwise, the group of people who will get hurt in the first place will be international investors, which is probably not their intention. That concerns both of our perpetual Eurobonds. Talking about SPB Exchange, this goes back to our earlier point that successful trading on the exchanges depends heavily on the functionality of the various fundamental capital markets infrastructure pieces and unfortunately some of them have been put on hold for now. We have not observed any disruptions in the infrastructure links, but some of them have been frozen. There's been some cautious signals from all parties at the political level that sanctions and the freeze on the infrastructure might potentially be lifted as soon as we see some peaceful progress in Ukraine. That's our hope for now. At the moment, nothing to add apart from the fact that the situation is liquid and heavily dependent, obviously, upon the peace process in Ukraine. Thank you very much, gentlemen. That has been very helpful and good luck to us all. Thank you. We'll take our next question from Himanshu Porwal of Seaport Global. Please go ahead. All right. Thank you. My question has been answered regarding the certainty of the upcoming Eurobonds, rather the coupon on the Eurobonds. Thank you. I think that was the first question asked by Mikhail Shlemov. I can repeat that we continue to be fully committed to servicing our debt. As far as the upcoming coupon payments during March, we have already prefunded it with our paying agent, and we have not been informed by the paying agent of any circumstances that would preclude them from distributing the coupon payments down to the investor community. Thank you. Yes, I did make a note of that. Thanks. We'll take our next question from Mikhail Butkov of Goldman Sachs. Please go ahead. Good day. Thank you very much for hosting the call. My first question is on asset quality. Looking back to the year 2014, if you were to compare some high-frequency data points on credit costs and maybe consumer behavior, how do you see it different now versus then? Maybe also how long did it take in 2014 for credit costs to unfold? The second question might be a little bit tricky one, but again, looking back to 2014, the picture in some instances was somehow similar because the interest rate, for example, also climbed quite significantly. There was some reduction in loans growth and pressure on net interest margin. Other than these items and also cost of risk, what can you mention now that is different? Yeah. I would formulate it like this. Thank you. Sure. I'll start the ball rolling, and colleagues will continue. The cost of risk in 2014 went up to around 16%-18% for the year. It peaked, actually spiked very quickly, straight after the January holidays in the beginning of 2014. It stayed elevated for about a quarter, and then slowly ticked down for the rest of the year. There was a difference in timing between the initial credit crunch and in all the problems with customers going to delinquency and the financial stress around that, and then the sharp devaluation of the ruble and the banking crisis that came at the end of the year. There was actually quite a large long interval between them. The shape of the crisis was very different. Obviously the cause of the crisis was exacerbated by sanctions, but that wasn't the root cause of actually the lending crisis. This is different territory, and what the shape of this is gonna look like is difficult to say. We don't have anything to talk about on the borrowing customer side at the moment in terms of their changes in behavior, because as I said earlier in answer to Elena's question, we just have no data because there's no change in the delinquency statistics at this time. Yeah, we assume it's gonna come. We're preparing ourselves for it when it does come. Right now, there's actually nothing changing. All the changes in customer behavior are on the liability side and the FX side as opposed to the borrowing side. As I say, you know, we anticipate that something will come in the next few days, weeks. Just before I hand over to colleagues to add color, I think what's very important to talk about is not the changes or the differences between the shape of this crisis as it evolves and the crisis back in 2014. It's actually that's the macro stuff. It's actually the differences at the micro level, because Tinkoff is a very different organization to the one it was back in 2014. With that, maybe Ilya or Neri could actually talk to the differences between Tinkoff then and Tinkoff today. Sure. Maybe I'll jump in then. Thanks, Oliver. Yeah, look, I think Tinkoff is a very different company to what it was back in 2014, 2015, and I'm sure a lot of you guys are aware. If we think about the credit business, a fourth of the book is secured lending, and the type of customer to whom we lend has also changed quite a bit, having moved from a more mass segment to a more mass affluent segment, and a more urban segment as well. Of course, the customers themselves have also been through a credit cycle in 2014, 2015, so they're more aware of how they need to behave and how they need to, you know, pay for their loans on time, et cetera. The customer base is more diversified than it was back then. Of course, now we have a number of non-credit businesses and fee generating businesses which also give a lot more resilience to the business. As you probably recall, about 45% of our revenues is from non-credit business lines. As Ilya said before, some of the transactional business lines have been benefiting from higher rates, and so you will see actually more revenue coming from things like debit card and SME. That gives the business more legs on which to stand on in case of volatility. Of course, the management team has been gone through the fire a few times, and so they know how to behave, and which levers need to be pulled at which time, in order to stabilize the business, to react, and also to know when it's time to start growing again and perhaps even accelerating again. Might sound like it's early to talk about that, but there's already, you know, we're a very entrepreneurial team, and we're already thinking about whether there might be some opportunities for us amid the volatility. Very different company with a lot more capital. Still the same high ROE, same high margin business, and therefore, the same level of confidence that we will be able to get through this. Thank you very much. Thank you. We will now take our next question from Olga Veselova of Bank of America. Please go ahead. Oh, thank you. I have two remaining questions. One question is about the limit on cash withdrawals. I saw it was introduced today, and it's in rubles, but it's also in dollars. You're saying you're highly liquid, so could you help us understand what's driving this, and also if the Central Bank keeps providing the foreign currency liquidity in full scale, is it fully available, FX liquidity? Second question is... So what was my second question? Oh, right. About the counterparty risk. You said that you are quite active on the interbank now. Can you actually operate on interbank with sanctioned banks, where you're not doing that just to avoid the risk of secondary sanctions? Thank you. Sure. Maybe a colleague could take the second question first. Well, you mean dealing with sanctioned banks? We actually don't do interbank operations with the banks. It's actually these days all done through the central counterparty which is 100% state. Basically, we have a risk on the state in this case, on the Central Bank. Thank you, Ilya. On the first question, so the question is about limits on cash withdrawal, Olga, is that right? Yes. Correct. Okay. As we say, the situation's very dynamic, and there may be something that I don't know that's happened in the last few minutes or hour or so, but to my knowledge, we don't have any cash withdrawal limits. Let's just break this question down. Liquidity, if we're just thinking total liquidity for Tinkoff, is absolutely enormous. Bear with me one sec. Okay. Yeah. Right. We've been over liquid going into this situation, and we remain highly over liquid now. The problem is, and there's no problem with ruble liquidity in terms of cash liquidity. i.e., people going to ATMs and withdrawing rubles. The problem system-wide has been dollar and euro denominated liquidity, so actually cash liquidity because there haven't been enough dollars in the system, physical dollars. Our position has been that, you know, from the very beginning of this when the shock hit, is that if customers want to take their money, we give it. If they want to take rubles, dollars, whatever, then we've been giving them in full. But obviously there's certain physical limitations on that in terms of the capacity of an ATM, in terms of the cassettes in the ATM, as to how much cash they have. We have recycle ATMs, which can take dollars from some people, or rubles or whatever they're putting in, and then disperse that cash back to the next person. Actually, if you look at the queues, there's been a balance. Depends on the ATM, but the balance between people depositing and people taking out, as I mentioned in the earlier answer. There's still not enough dollars in the system. We've been getting dollar cash dollar liquidity loading up our ATMs. Sometimes it's been running out in ATMs, but generally we've been managing to keep up that flow. However, now there's less and less dollar cash liquidity in the system. As well as just the physical restrictions of the ATMs, we're thinking about how we go forward with this. Right now we have no restrictions. Obviously the Central Bank is thinking about whether introduce restrictions should be imposed across the system for cash withdrawals. At the moment, we don't have anything on our ATMs. Okay. Thank you. I was reading it actually very recently in Federal Press, so maybe it's just wrong news. No. in media. I think basically what you Okay ... what you're seeing there, you know, this is obviously the media, who don't have the full picture. They- Okay They read what people are writing on the forums that in such and such an ATM, in such and such a shopping center, Tinkoff ATMs have stopped dispensing dollars or whatever. That's only because the dollar's been cleaned out. The ATM has been cleaned out. We have no restrictions. Mm-hmm Currently on any cash withdrawals anywhere. Okay. Yeah. Well, it actually refers to the bank's website, but I hear you. It's wrong news. Does the Central Bank provide a tax repo in full scale? I should know, but I don't know. Thank you if you help me to understand. Sorry, could you repeat the question, Olga? Yes. Does the Central Bank provide foreign currency repo in full scale? Ilya, I'll probably best coming to. Well, yes. Basically, central bank provides the liquidity. It actually eased the open currency position regulation. We don't use extra liquidity. We don't need it. In case we would, we would be able to get additional liquidity. Again, there was a deterioration of prices on securities. There is a possibility to keep in the accounting systems the prices that were on eighteenth of February, something like that. Again, we don't use this measure so far 'cause we don't need. That's the short answer. Okay. Thank you. Let me also thank you for having this call. It's really useful to have color from the business. Thank you. Thanks. We'll take our next question from Can Demir of Wood & Company. Please go ahead. Hi, everyone. Thank you for this call. I have two questions. One is on the payments business. You mentioned that the cards are working and things are fine for you as an issuer, but I thought Mastercard and Visa actually banned larger acquirers in the market, so I was wondering how that works. That's my first question. Maybe I'm wrong about this information by the way, just checking with you. The second question is about the IFRS and Russian accounting standard treatment of your reserves at the Central Bank, because the Central Bank has a liability to you and there is a significant divergence in terms of their credit worthiness in euros and dollars, right? I mean, how does it work from a hard call accounting logic? That's my second question. Thank you very much. Okay, thanks. Ilya wi ll take the second. I'll take the first on the payments landscape. We have to divide up the world here unfortunately into the domestic microcosm that we have at the moment and then the external world. This applies to trading. It applies to movement of capital, and it applies to payments. There's very few institutions that can provide this portal between the two worlds. We're one of them. In fact, we're the only major one that can. In terms of payments, there's the domestic payment system or domestic payment environment, and then the external payment environment. For the majority of large institutions, financial institutions in Russia, their payment instruments, so we're talking mainly about cards here, don't work abroad, yeah, because of obviously sanctions. Mm-hmm. Within Russia, they continue to work because after 2014 and the first round of sanctions, the Russian state, orchestrated by the Central Bank, created a national payment system. The national payment system provides like a protective layer. It's basically a domestic switch, which means that all cards, irrespective of their brand, are switched locally and continue to work, which means that all of the acquirers are working to my knowledge. You can still pay in, for example, a VTB terminal, point of sale terminal, or a Sberbank point of sale terminal. They get switched locally and the cards continue to circulate. Payments, physical payments at point of sale, cash withdrawals and virtual payments, they're all continuing to function normally within Russia. The one area where maybe, and maybe this is what you've picked up on, where it's a little bit more tricky is mobile-enabled payments. If you're a sanctioned bank, then Apple Pay and Google Pay is no longer available to your customers. The physical card will still be accepted in a physical terminal for payments within Russia. That's the situation as it is. Understood. Thanks a lot. I'll continue on the differences in statutory accounting and IFRS for the accounting for the money that we keep in the Central Bank. That's, I guess, what was the question. There is no difference at all. It's all cash. No reserves are created against your Central Bank. I don't know, maybe somewhere in the world it's done differently. In our case in Russia, it's the same. It's just cash. Ilya, how do you mean? I mean, when someone deposits dollars at Tinkoff, then you obviously have to set aside reserves for that, right? Those reserves are set as, you know, that are passed on to the Central Bank. Central Bank currently doesn't have any dollars, right? How does it work from a you know, because they have a liability to you, right? To return those reserves, but they are not in a position to return any reserves. Isn't that an accounting issue in IFRS terms? No, it is not. Well, it's just cash. When someone places dollars or rubles, it doesn't matter. We keep it in our correspondent account and that's it. We can keep it in Okay. In the vault. Basically, the correspondent accounts are different. In if it's dollars, it's a correspondent account with our international banks. If it's rubles, it's with the Central Bank. Okay. Yes. There are difficulties right now in getting physical cash dollars. Again, it's not the Central Bank's problem. It's like a logistical problem. Central Bank, it's not an event of default of the Central Bank if it's not providing us with enough cash, for example. Because our cash is a corresponding account with JPMorgan, for example, or some other banks. Well, maybe I don't fully understand your question, but in any case, we are statutory. I will repeat just the statutory and IFRS in this case are absolutely unified, and there are no reserves created against this exposure. Okay. Maybe I can. Maybe I can add, it's Andrey here. Hi, Can. Hi. If I can add basically to the question, the reserve requirements for dollar deposits are actually being fulfilled in ruble terms. Central Bank does not own US dollars in that case. They own Russian rubles. Ah. Obviously, there is no kind of any concern in the ruble debt from the Central Bank anyway. Okay. That explains it. Okay. Sorry. Yeah. My bad. Yeah, I didn't know that. Super. Thank you very much, guys. We'll take our next question from Mehmet Sevim of JP Morgan. Please go ahead. Hi. Good afternoon. Thanks very much, everyone. I hope you're all doing well. Thanks also from my side for keeping the communication channels open. I just have two questions, please. The first one is, you mentioned that you've stopped new lending for most products. In this environment, can you please talk about your fee line and how robust it can be in the current environment? For example, are you seeing any change in customer behavior on the transactional side, debit card transactions, acquiring, et cetera? That would be the first one. Secondly, would you be able to quantify the size of the deposit outflows or inflows that you've seen in the last Seven to eight days? I'm sorry if I've missed that. How does it compare to 2014, December 2014 when we had a similar episode? Finally, I believe there have been some changes in your board of directors. Is there any further change that you would expect again in the current environment? Thanks very much. Sure. I'll kick off on the usage of cards. Not that I'm aware of, we're not seeing any changes in usage. We're just going on the basis of experience of previous crises and dislocations. When there's a ruble devaluation, people tend to go and buy stuff, yeah? They're worried about the rubles that they have on account or on deposit losing their value, so they might go and make a large purchase of consumer durables or a car or, you know, sometimes even flats. I'm not sure if we're seeing that behavior at the moment. It's probably a little bit early to see that. That's one thing that we may see. you know, as we've said several times on this call, what we have seen is a little bit of dollarization, people moving into foreign currency. We've seen that, a very little bit in Tinkoff, but obviously seeing that a lot more in other banking institutions. I wouldn't expect to see any, you know, significant changes in terms of our card usage right now. Obviously over time, it could maybe tail off a little bit because people are obviously not traveling because it's very difficult to get out of Russia at the moment, and it has been for a while because of COVID. I don't suppose people are gonna be, you know, going on holiday much at the moment right now anyway. I suspect that, you know, there could be some change, but that's something that will come through the wash over the next weeks and months as opposed to something you'd see right now. In terms of liquidity, maybe Ilya or Pavel, somebody wants to take that one. No. Sure. Before we go into this question, could I also clarify? I think that's important just to Oliver from the previous discussion we had. We wanted to reiterate to the market and to analysts that, you know, Tinkoff does not have any limits on ATM withdrawals on any of its ATMs. That should be clear-cut. I mean, you know, I think sometimes in ATMs, you might have a limit on the amount of money that you might withdraw in one go because physically you cannot fit, you know, as much paper in the box as you could possibly can. I think that in rubles, if you count this in smaller denominations, I think the number is something like RUB 700,000. You know, for customers you could do a sort of second transfer. You can withdraw as much rubles in every single ATM of Tinkoff as you possibly can. I think that's important to get across. As we mentioned, you know, we're also filling up the dollars given the extraordinary demand. At this stage we're just doing our best, but there are no limits on any ATM withdrawals. I think that's a very important point to get across. Ilya, you want to comment on liquidity? Yes. Well, comparing to 2014, at the end of 2014, when the Central Bank hiked the rate by, I recall, six basis points, and all the banks started increasing rates on deposits. Sort of we Sort of took some pause and we saw money going out for probably two days or so, and then we had to increase the rate of deposits and then the outflow stopped. Actually there was at the end of December 2014 even an inflow of cash. Today the amounts that are sort of at some days we have a positive cash balance. At some days we have a slightly negative, but this even if it's when it's negative it's incomparably small to the total cash that we have. It's a fraction of a percent, so nothing to talk about. This time, yes, we increased sort of stepped up and increased the rates on short-term deposits and current accounts faster. Hope it helps. Thanks very much. I think there was just one question on the board of directors and maybe one last question I would have is on international expansion. Pavel, I think you mentioned that you committed to the plans. Is there anything new on the license in the Philippines, and do you think there are any incremental risks to getting it now? Secondly, I think you mentioned Latin America acquiring. Is that correct? Did I understand that correctly? If so, can you please- Yeah, that's correct. Yes. Yes. Acquiring and payment business in Latin. Yes, that's right. It really is. You know, at this stage, answering question on Philippines, we are working with BSP. We had a number of exchanges on what needs to be done to provide additional documents. I think there was a request from their side. It's a usual process. I mean, it's fairly routine in terms of questions, you know, on our application, you know, responded back. It's a process that takes a bit of time, and you know, something that we work through, you know, as we speak. I mean, there is no news at this stage. We are in a waiting mode, but I believe, you know, we've provided all the necessary answers to BSP. You know, obviously, we're working. I mean, it's a process. I think on the Mexican business in Latin America, we're looking at, you know, experimenting on acquiring the payment side. I mean, this is, you know, one of the small scale experiments that we're running in the market that our future stores. We're exploring that. At this stage there is nothing to report, except for us, well, submissions of experiment with a number of potential customers, small, medium scale merchants in terms of our technology platform and solutions that provided. This is the status on those two fronts. Okay. That's very helpful. Thanks very much. Okay. As a reminder if- Sorry. Yeah, go ahead. While we're waiting for people to think of their questions, if there are any more, there's one question that was sent to us earlier. Well, I'll read the question. I think Pavel's gonna answer this one. Tinkoff's most valuable assets are its brand and its employees. What is employee morale like? Have you noticed any difference in how the brand is perceived? Pavel? Oliver, thank you so much for the question. From our side, we do not see any change in perception of brand. We're obviously working very closely with employees to make sure that they embrace that at this difficult moment. You know, for example, for our working level teams, for our core employees, you know, except, you know, obviously for the top management, we made a step towards increasing their salaries, accelerating the increase in their salaries, from March first, the one that was planned for later in the year. That was important step. We're obviously as well the hotline to help with any questions people might have. We are communicating extra frequently, almost on a bi-weekly basis, you know, holding the layer of the top management business leaders, making sure that we stay quick, nimble and very responsive to the changing market environment. We're all focused on making sure that we succeed in this difficult setup. I believe that the employee morale patience is very high. We all understand what we want to achieve, and we're working hard towards that objective. Now, in terms of the brand, I think the brand is standing strong and shining despite the otherwise gloomy context. We mentioned that there is a great sense of virality among the customer base. People are recommending Tinkoff to each other in these difficult times. We have lots of inbound questions on moving their balances, moving their financial lives to Tinkoff. You know, our brand is working very well in this environment. There is a strong perception of us being strong reputable bank, and we're working around the perception. I hope this answers the question. Thanks, Pavel. Just to add to that. Our employees are in Tinkoff, not just because it's a cool company, not just because we, you know, we're doing some interesting projects, very innovative stuff, lots of stuff on the tech side, but also because we're people on a mission. We've mentioned this many times in the past that we're an ideas-driven organization. We're not material. We're not about You know, the way at the end of the day, we're about how we can bring positive impact to our society and serve our customers best. Everybody's very focused on how we make sure that the 20 million, as Pawel just quite rightly pointed out, actually even more rapidly growing now, customer base is performing, that we're answering all the questions, serving them as we can. Disbursing cash if they want cash, helping them with whatever problems that they have at the current time. Obviously, the range of problems is far wider than it is on a normal day. Our employees are very focused, very engaged. Obviously, it's a very uncertain time for everybody. As Pavel said, we've got lots of ways of maintaining morale and communicating and helping any employees that have issues, whatever they might be. Linked to that one, there's actually another question which has come in, which is that a lot of compensation has been paid in equity, both to employees and management. Is that going to continue being the case going forward, particularly given the current state of affairs? This goes back to the answer that Sergei gave earlier. Obviously, you know, we're operating in a very uncertain situation, but all of us are optimists and it's not the focus of people right now. As I said, the focus is customers. You know, we all very much hope that the situation will stabilize, then the fog will lift, and we'll understand how we can continue to create value and make sure that shareholders, including managers and staff that have a stake in terms of equity, will be able to realize that value through that equity. We don't exactly know how it's gonna work out today, but we're all pretty confident that over time, we'll be able to normalize the situation. I think there was another question, unless Larissa is gonna tell me that we should go back to questions from the virtual floor now. Yeah. Actually, Oliver, there's been another question. Okay. A clarification on what you mentioned earlier. Inflow of liquidity. Yes. Got it. All mentioned inflows of liquidity. Are those inflows from existing customers adding to their accounts at Tinkoff, or are there also new customers setting up accounts at Tinkoff? This is something we've alluded to a couple of times, maybe we should make a little bit more explicit. Existing customers have been topping up their accounts. That's, let's say, probably funds coming from other banking institutions. But also there's a lot of people who've been seeking to open accounts with Tinkoff. This is what Pawel referred to as virality. There's that aspect, but there's also the aspect of safe harbor. This is not something we're crowing about. This is a terrible situation all around. You know, there is an influx of customers, and so we are getting more liquidity into the institution that way as well. Thank you. We are now ready to go back to the queue and take a question from Dmitry Trembovolsky. Thank you. We'll take the next question from Dmitry Trembovolsky of DT Capital. Please go ahead. Hi guys. It's a truly dark time that I have to come back to the Q&A session, which I haven't done for I think a couple of years. The question I have to you is the situation we have with LSE right now, and of course it's very early days, but any ideas on what you guys will do if it's going to appear that the trading which is suspended is not gonna be resumed and that Tinkoff and maybe many other Russian entities are not welcome on LSE anymore. What happens to all of us who have GDRs? Any ideas on that you have any conversion or direct listing or any other things that could be done to alleviate that? Yeah. Thank you. Sergei? Yeah. Hi, Dmitry. Yeah, you're right. It's been quite a while since I had the pleasure of answering your questions. The one you've raised right now obviously is a topical one. Like, another 20 or 30 Russia-related names, we were informed by LSE of the temporary suspension of trading on that venue. It's been 2 days since then. There has been no further clarification from LSE about how long this situation might continue. The goal and understanding is that it's suspension. It's not delisting, it's not forced delisting, it's suspension. The duration of this measure. Well, this measure is part of the sanctions package introduced by the U.K. on Russia. The immediate interpretation that market participants tend to make right now is that the duration is gonna be linked to the duration of the broader package of sanctions. The exact period of such suspension is very hard to estimate at the moment. If we see that the suspension tends to be long, we should remind you that we have dual listing. We have listing in London, and we have listing on the Moscow Exchange. Right now, the two pools of liquidity are totally isolated because at the depository level there seems to be virtually no connection. The trading on the Moscow Exchange is expected to resume in the next few days following the bank holiday next week, and we'll see where it takes us. If we see that LSE situation is likely to persist for a prolonged period of time, we will probably consider moving our primary listing to Moscow based on our existing GDR program. Because the immediate task of paramount importance to us to make sure that the value held by our GDR holders remains intact. The GDR holders will get the chance to keep the value within the deposit and receipt program, which is intact. Our DR program provider has confirmed to us that right now they see nothing that would cause the collapse of the DR programs in itself. One of the measures we consider for the next steps if we see that LSE will cease to be a feasible venue for our listing, we might consider a third venue. We don't want to go into detail right now, but we'd consider adding another venue to the Moscow Exchange, which will be more sort of reliable or less politically dependent compared to LSE. This is. These are extremely early days, Dmitry, and you'll appreciate that actual plans will need some time to be formalized. Of course, depending on how the situation unfolds, we'll be in touch with the investor community announcing our more specific plans. Mm-hmm. Okay, Sergei. Thanks very much. That's very helpful. As far as this, the London GDRs, if there is a prolonged suspension just trading them or putting them or allowing us to trade on other markets, and then you obviously could also think of other listing options. That's the summary here or I missed some? Yeah, Dmitry, that's right. Just to be politically correct, there's no such thing as London GDRs or Moscow Exchange GDRs. The GDR program is basically something that helps you create negotiable securities, right? So, Correct. Our GDRs happen to be listed both in London and in Moscow. Correct. The GDR program is in place and it will be traded somewhere. If it's not LSE, then it's gonna be MOEX plus potentially some other venue to be discussed later in the process. Mm-hmm. My understanding is that also there is the NSD and the Euroclear. They don't really work together very well at the moment. It's clear whether. You know, if you have GDRs in Euroclear, whether that you can really, you know, trade these depository receipts on MOEX. Is that correct in my reading? Yeah, that's exactly correct. This is something that I mentioned at the very beginning, that the onshore GDR pool and the offshore GDR pool unfortunately don't have any linkages between the two at the moment for the reason you cited. Yeah. Euroclear has put on hold the link between the western depositories and NSD. That's another sort of capital market infrastructure issues that would have to be resolved. Clearly, the combination of sanctions and anti-sanctions on the part of the CBR will persist for some time. The jigsaw puzzle of a new sort of capital markets context will be formed after we see which links of the capital markets infrastructure remain in place, you know, a bit later. Mm-hmm. Mm. Okay. Dmitry, if I could add to Sergei's answer. I think an overall message from our side that at this stage we're talking about a very rapidly evolving target in terms of the state of play of the financial market architecture. I mean, every day we're seeing news, we're seeing sanctions, counter-sanctions, countries joining, countries introducing retaliatory measures, Russia included. At this stage, we do not feel that the dice is fallen one way or another. Give it please few weeks, once we have clarity, once we have a steady state architecture to talk about, who's talking to whom, who's not talking to whom. Within those constraints, I think we will find. I mean, as I said, at this stage, I wouldn't even mention the names London, Moscow, anything else. At this stage, you know, we're actually witnessing sort of a change of the, you know, world order in terms of financial market architecture. Let it calm down. Let us understand what the limitations are, what constraints are. From our side, what we are, we remain committed to being a public company, making sure that we preserve shareholder value and there is this value that we can deliver to our shareholders. I think even mentioning the names of specific exchanges from the list, I think it's a bit too premature. We're certainly looking at options and very aggressive in finding the best possible solution for our shareholders. As a reminder, if you'd like to ask a question over the phone, please signal by pressing star one. I will now hand over for your webcast question. Larissa, are we now winding up? Yes. It seems like no questions in the queue. Okay. In that case. Any conclusions, remarks from you, Oliver? Yeah. No, just a thank you to everybody who attended this call. Obviously it's a terrible time and you know, we hope that the situation gets resolved in terms of running the business. You know we can handle it. We can handle this. We know what we're doing. We're pretty battle-worn. Obviously, you know, there's a much bigger picture. We'll keep everybody abreast of what's happening inside Tinkoff, our regular communications, and if you have any questions, you know you can always fire them off. Stay safe please everybody. Bye now. Thank you so much. Thank you. Thank you. That now concludes the call. Thank you for your participation. You may now disconnect.