Good afternoon, Miguel Maya speaking. Welcome to BCP Earnings Conference Call. As mentioned in the previous earnings conference, we are now presenting also the strategic plan for 2025-2028 period along with the nine-month earnings. To ensure this call run smoothly, we will adjust the structure of the presentation today. I will begin by highlighting our performance over the past nine months followed by Miguel Braganca, who will provide additional details on our consolidated performance. Then I will present the strategic plan before opening the Q&A section. Regarding the results of the first nine months, I begin by highlighting the net income of €740 million, a year-on-year increase of 9.7% driven by a solid operational performance that supported the core operating profit of €1.77 billion. The activity in all of our three core markets contributed to this performance notably in Portugal, where net income went up 8.8%, having reached almost €606 million, supported by the leading position of BCP in multiple business fronts and confirming the profitability and efficiency of our business model. The contribution from Mozambique amounted to €64 million, in line with previous years and confirm the quality of the franchise and the relevant profitability of this operation despite the impact of a substantial increase in cash reserves held by the Central Bank – with the Central Bank. In Poland, despite the costs with legal risks still being a significant burden, Bank Millennium continues to demonstrate that it has a high-quality franchise and the profitable business model. The costs associated with FX mortgage loans portfolio amounted to €550 million in the first nine months, broadly aligned with the amount in the same period last year. Additionally, the costs related to the extension of the mortgage moratoriums amounted to €36.6 million, which was below the amount that had been provisioned for this purpose. Despite these costs, Bank Millennium's net income went up more than 18% and amounted to €127 million. It is worth noting that in 2023, the net income of Bank Millennium was positively impacted by a one-off gain of €127 million from the sale of 80% of the Millennium Financial Services. The consistent organic capital generation capacity of our business model is well reflected in the solid capital position achieved. We have capital ratios comfortably above regulatory requirements with CET1 at 16.5% and total capital at €20.8 million having increased 219 basis points in CET1 and 225 basis points in total capital in the last 12 months. Operating in an increasingly competitive landscape for deposits, the quality of our retail banking business model supported on strong commercial skills led to an increase of 9% in customer funds which stood above €100 billion. We sustained the improvement trajectory of our balance sheet by continuing to reduce nonproductive assets. Over the past 12 months, we decreased NPEs by €92 million and foreclosed assets by €60 million. The NPE ratio is now at 3.5 with a total cash coverage of approximately 80%, which stands above 120% when including real estate collateral. Our rigorous management of the balance sheet risks enabled us to improve the cost of risk, which is currently well uncured below 50 basis points, a reasonable result for our business model. At the group level, the customer base expanded 4% in the last 12 months, exceeding €6.9 million, of which almost €2.8 million in Portugal. Most notably, mobile customers grew 11% during the same period, accounting for 71% of the group's customer base and the 61% in Portugal, revealing the success of our digital transformation journey and the quality of our digital channels. Now I give the floor to Miguel Braganca.

Thank you very much. Going directly here to the income statement. As you see, we have been able, in spite of the much tougher interest rate environment where interest rates decreased substantially when compared with the same period of last year to maintain the core income in our consolidated accounts which was notably and clearly above our initial expectations. In terms of operating costs, mainly due to the salary inflation in Poland. We increased around 11%, still below what you'll see in some of our peers. So the core operating profit decreased by around 4% compared with a year that had some extraordinary elements as we had last year. Another extraordinary factor that we had last year was the sale of our insurance brokerage company that impacted our P&L in €127 million, which, of course, did not occur this year. Correcting for this effect, our operating net income was broadly constant. An important factor when we compare 2024 with 2023, is that we already see the decrease in the total provision for CHF mortgage risk as we had anticipated when we stated that 2023 was clearly – would be clearly the height of the provisioning for legal risk in CHF mortgages in Poland. So clearly, already on a decreasing trend as we have anticipated, still high. We also have here an important element as we had already discussed in June. It was the fact that some of the provisions for Swiss francs were declared, so to say, tax deductible, so that our income taxes in 2024 benefited from it. So all in all, this implies an increase of our net income of around 10% from 2023 to 2024. In terms of NII, as you see, we have been able to present a very resilient NIM in spite of the decrease in interest rates. The decrease in interest rates that was – that occurred both in Portugal and in Poland, as you know, keeping a NIM in Portugal above 2.2%, which as you know, is above the European average of NIMs and quite stable when you compare also with what is happening in – with some of our competitors. In the international operations in spite of the strong decrease in the interest rate of the zloty. We were still able to show a NIM above 4.5% in the international operations. All-in-all, the NIM above 3%. Fees and commissions also performed well in the mid single-digit area as we have anticipated here to – with a strong contribution from bancassurance and from securities and asset management already showing some positive effects from the market, but also in terms of daily banking and fees, a positive evolution. Other income, we have here a positive evolution to – in terms of regulatory contributions, they were stable but this is a tale of two sides, so to say. In Portugal, they clearly decreased because the contribution to the European fund and to the local resolution and to the local contribution decreased from €54 million to €39 million. In Poland, as we end the capital protection plan, the bank started to pay as it is normal and as our competitors do the bank tax. The bank tax, of course, that was not paid last year. All-in-all, one effect compensated the other. Another positive effect that we had in Q3 was the sale of UPL – of UPT portfolio, where we had a capital gain around €30 million which shows also the prudency of our impairment policy. Operating costs. Operating costs, as you see in the mid single-digit area in Portugal. In spite of the effort that we are all doing in terms of increasing our investments in technology and resiliency in the bank, still with a cost-to-income clearly below 40% and an increase in the international operations of around 17% to some extent, or with a very large contribution from Poland, where, as you know, minimum wages have been increasing consecutively at a double-digit pace for more than two years. Cost of risk. Cost of risk with a positive evolution if we adjust for a special recovery that we have clearly within our target of 50 basis points in Portugal and international operations in spite of the more challenging environment with the recessionary elements that you know. This was also shown in the continued decrease of NPEs so we have, in spite of the much lower side of the portfolio to decrease the NPEs year-on-year in Portugal, 12.3%. In the international operations, broadly stable when this is explained to a large extent by the growth of the portfolio. All-in-all, we were able to decrease the NPEs ratio. The really past due 90 days ratio is only at 1.4%, only 1.4%. And if we have the ratio on including loans, so without securities, which typically have less risk, and – but also includes the unlikely to pay loans, the ratio also decreased from 3.6% in to 3.4%, which already compares very reasonably with European banks with a business model such as ours. I will go here to capital and liquidity. As you – as we have shown, we will have one quarter more in spite of only accruing 50% of the earnings to grow our CET1 ratio from 16.2% to 16.5%, reaching MDA buffers above 600 basis points and very comfortably above the minimum ratios, as you see here in the graph. This also is shown in the leverage ratio where we clearly performed better than our competition which is partly explained also by our higher RWA density associated to the more conservativeness of our models. MREL, clearly above the MREL requirement, our MREL plus CBR overall 29%, 28.7% to be more precise and showing a ratio of 34%. Liquidity position, very robust. I will not comment on it for the benefit of time. And just as I will present for hopefully for the last time, I will not go into the international operations for the benefit of time, but I will only summarize this slide. It will be the last time that we'll be presenting in this slide is basically the slide of our previous strategic plan, where we clearly highlighted that we have met in anticipation practically all of the commitments and all of the ratios that we had presented to you three years ago. I will now pass the floor here to Miguel Maya.

Thank you, Miguel. I will now outline the bank's strategic plan for the previous 2025 to 2028. The presentation is structured around three blocks. The first relating to our trajectory and market outlook. The second expressing the main highlights of our ambition and strategy and the third summarizing the main priorities for the most relevant geographies in our business portfolio, namely Portugal, Poland and Mozambique. We will conclude with a recap of targets before I open the Q&A. We have reached the current moment with the bank that presents a sound performance anchored on the proven track record clearly evident in the success achieved in the bank's recovery and in automatic defined in the previous two strategic plans were met. We have achieved a robust financial position with clear market recognition as clearly demonstrated by the bank's rating evolution and the stock price performance. The transformation in the way we interact with customers, incorporating technology into processes and business models, always keeping in mind that we want to position ourselves as the reference bank in symbiotically enhancing the relationship between people and technology, has allowed us to achieve high operational efficiency, reinforce leadership in multiple business variables and obtain high preference indicators in the choice made by customers. The ability of the bank to execute the strategic plan is well demonstrated by the evolution of our commercial activity and the way business processes have been adjusted. Let me highlight, for example, since 2018, the reduction of around 25% in the number of branches, simultaneously with this reduction of the physical network, there was an increase of 37 percentage points in the number of customers who regularly use mobile in interactions with the bank, representing more than 71% of the customers base today. The growth of the active customer base exceeding 42% and business volumes that is customer funds and loans growing by more than 26%, even in a very difficult text. I would also highlight the evolution of NPEs and the significant increase in impairment coverage from 52% to 80%, which clearly sign on the normalization of the bank's balance sheet as well as the robust net achieved visible evidence in the solid capital and leverage ratios. Net operating revenues grew by more than 67% the cost-to-income ratio is solidly anchored below 40%. The evolution of cost of risk was also very significant, standing at a level below 50 basis points. Net income is almost 3x what was achieved in 2018. And due to the bank's evolution ROE stands clearly above the cost of capital. Our evolution altogether driving BCP to surpass more than a year ahead of schedule, the last targets that were presented to the market except for ESG rating which was defined at a time when this metric was not yet clearly master. As the market knows, not only the bank does not have any issues in this area, but it is also firmly involving in the preparation and implementation of the increasingly demanding regulatory requirements in terms of ESG. As would be expected, given the observed evolution, the bank has recorded positive development in the evaluations conducted by rating agencies and achieve investment-grade status for the agencies that follow us. The evolution of the bank stock price recognized the work developed, highlighting the differential compared to the market throughout the entire period, especially between 2020 and 2024. BCP begins a new cycle well prepared to handle a context in which the financial industry will continue to face significant challenges among which I will highlight the convergence of interest rates to levels aligned with inflation around 2%, a context that allow us to foresee an expansion of lending volumes with BCP being in a more favorable position due with strong retail deposit franchise, the achieved normalization of cost of risk and the decrease in other provisions. I would also highlight the strong incorporation of technology in business models and operational processes, which will enhance commercial innovation capacity while ensuring benchmark efficiency levels. And equally important, all the investments and the work carried out and to be done in strengthening our robustness will surely further empower the bank for a context marked by a strict regulatory demand and on which I would like to highlight the digital Operational Resilience Act. The arrival point, which now becomes the starting point for a new cycle is deeply marked by an approach in which the customer is the cornerstone people are the link of trust and the quality of the service provided by in-person and digital channels are the facilitators and simplifier of the interactions. The quality of the franchise is systematically recognized both in terms of Net Promoter Score and by the multiple distinctions of then in all the geographies where we operate. Allow me to also highlight the evolution in terms of digital and mobile customers who currently represent 78% and 71%, respectively, of the group's customers and simplifying for Portugal, the preponderance and relevance of the digital channels in terms of transactions accounting for 87% as well as in the percentage of sales in number currently exceeding 59%, which represents an evolution of 41 percentage points compared to 2019. These slides clearly shows not only the relevance of Millennium operations in our different markets. but also the growth potential in all of them with special emphasis on SME credit in Poland, where the bank with high coverage capital ratios and a comfortable liquidity position is well positioned to significantly evolve. I would also highlight the growth potential in Portugal, especially in the SME sector and in consumer credit. In Mozambique, the goal is also to develop the credit to the corporate sector with the pace of this progression being greatly determined by the macroeconomic context and the advancement of major energy projects. The growth potential of our operations, we can become even more evident in this slide. In the three main geographies where we operate, the GDP growth potential is substantially higher than the average growth forecasted for the European Union. The countries in which we operate will benefit from strong structural fund support which will obviously have a significant impact on the economic growth. I would also highlight the enormous growth potential of credit to the economy in the Polish market where the percentage of credit to the private sector represents only 35% of GDP compared to 80% in the European Union. Moving now to the chapter of ambition and strategy for the next cycle. I will start by highlighting the name of the plan, [indiscernible], which we consider most adequately translated into English has delivered more value. Deliver more value to our customers, creating distinctive and engaging customer experience through the symbiotic combination of human and touch and technology. I would highlight that we intend to exceed 8 million customers. We aim to have more than 80% of customers regularly using mobile as the most frequent means of interacting with the bank. We seek to maintain a leadership position and to be a benchmark in terms of satisfaction and customer recommendation. At the level of our people appreciation an essential aspect of our success is the capacity for innovation and execution, aspects for which the quality and motivation of people are paramount requirements. For this new cycle, I would highlight the imperative to attract and retain critical profiles, obscure the talent base and reward performance defensively to achieve an even more positive organization. I would like to draw your attention to two indicators in this slide, the high satisfaction we intend to have at the level of the employees with relevant contributions to the bank and the level of professional progression we have to achieve. The circular of the strategy addresses our shareholders, although all of them being of utmost importance for us as only one year’s evolution of these three pillars can sustain high performance over time. In the shareholders' pillar, we proposed to deliver profitability above the cost of capital throughout the cycle, distributing relevant returns while ensuring strong balance sheet resilience. I would highlight that we propose to achieve ROE levels over the plan above 13.5% and subject to the plan being executed in its main component, achieving the relevant capital and business targets in Portugal and in the international area and necessarily that European supervisor authorizes it we proposed to ensure distribution up to 75% to shareholders to dividends and share buybacks. Allow me to emphasize that for this purpose, we are considering the bank's capacity to generate over the plan a cumulative net income between €4 billion and €4.5 billion. After successfully executing two strategic plans in a very challenging environment, the first of which was called mobilize and whose purpose could be summarized by the expression and get back on track. And the next – which we now conclude and marks the end of the bank's normalization period, resulting in converging with the market in terms of balance sheet robustness and profitability – we now enter the 2025-2028 cycle under the motto deliver more value or in other words, achieve superior performance. To this ends, the main guidelines of the group strategy and for each of our operations have common denominators to achieve compelling profitability, which means organic growth in attractive pools, increasing portfolio balance towards SMEs focused expansion and innovation adjacent opportunities and strengthening the credit risk capabilities. Also achieve an edge in customer experience and trust through the combination of human touch technology to Excel, increasing the tech and cyber resilience and achieve tangible and relevant returns. This slide express the main target for the new strategic cycle. In business volumes, we aim to exceed €119 billion, of which more than €120 billion in Portugal. In terms of customers, we aim to reach the €8 million mark with more than €3 million in Portugal. We anticipate that more than 80% of our customers will regularly use the mobile channel in their interactions with the bank. We want to remain a benchmark in terms of operational efficiency with cost-to-income ratio below – well anchored below 40%. And at the cost of risk level, we anticipate to be below 50 basis points, highlighting the growth and seeing we aim to achieve in the market shares across different geographies. In terms of ESG evolution, a team that will be underlying present of all fronts of the bank's development, we assume the ambition to rank in the top quartile of S&P Global CSA ranking. The concern with very rigorous capital management remains a priority, maintaining a ratio always with adequate buffers to regulatory requirements and to have the robustness desires given the bank's business model, which implies CET1 above €13.5 million. The ambition ROE is above the cost of capital and higher than €13.5 million. Regarding shareholder distribution, I reiterate and emphasize what I have already mentioned, which is for this purpose, we are considering the bank's ability to generate a cumulative net income between €4 billion and €4.5 billion over the cycle of the plan. On this assumption, we aim to promote a shareholder distribution up to 75% over the cycle through dividends and share buybacks subject to the exclusion of the plans relevant capital and business targets in Portugal and in the international area and necessarily to the authorization by the European supervisor. We foresee delivering solid revenue growth driven by customers and volumes evolution. We forecast the growth in net interest income over the cycle in the range to €500 million to €700 million. The growth of commissions in the range of €200 million, which materialized in the growth of net operating revenues in the range of €4 billion to €5 billion over the period. Despite the projected decline in interest rates, we envisage ensuring healthy NII trajectory, supported by €300 million to €400 million from loan volume growth between €400 million and €500 million from deposit volumes growth and a negative effect in the range of €200 million to €300 million from the net impact of interest rate decline and NIM hedging. This evolution allows us to foresee that the NII will be in the range of €3 million to €3.4 billion. The initiatives defined for the evolutions of the banks over the strategic plan duration are based on multiple initiatives, each frame by specific objectives, among which I would highlight the progress in productivity by our employee noting the goal of increased business volumes per person by approximately 30%, maintaining the banks as a reference in efficiency, ensuring that the necessary investments to sustain the predicted growth and enhance the bank's resilience do not compromise our distinctive characteristic of high operational efficiency. This will require to continue a very meticulous cost and investment management policy. The ambition for growth will be framed and subordinated to a well-established risk appetite within the culture of ambition with rigor that have successfully guided the excretion of previous strategic plan. Going forward, keeping the cost of risk below 50 basis points will continue to be a strategic reference. As I mentioned, the commitment to ESG evolution will be present in all initiatives and actions outlined in the plan. We firmly believe that the bank plays a significant role in contributing to society in this field and this contribution goes beyond merely complying with an increasingly demanding regulatory framework or aiming to achieve carbon neutrality. Our role includes and centralized our supporting – on supporting our clients so that they too can contribute and succeed in this crucial front, which is essential for building a better, more inclusive and prosperous world. Our reference metric will be to position ourselves, as I said, in the top quartile of S&P Global CSI Index. To conclude this section of the presentation, I want to highlight with all the caveats previously mentioned that our ambition over the plan is to generate a cumulative net income between €4 billion and €4.5 billion. We aim to for ROE greater than 13.5%, the average to top payout to shareholders will be up to 75% with a dividend payout of 50%, and additionally, a large share buyback program, subject to supervisory approval and achievement of the planned relevant capital targets, meaning Common Equity Tier 1 above 13.5% and the achievement also of the relevant business target in Portugal and the international area. It’s worth mentioned a projected average annual book value per share growth plus dividend yield around 15% per annum. I would like to emphasize, and we ask your attention for this specific statement. It’s also important to mention that the Board of Directors has already approved the submission to the ECB of a request to execute a share buyback in the amount of 25% of the annual consolidated profit estimated for 2024. To introduce you the main priorities in each geography, and conclude the presentation, I now hand over to my colleague, Miguel Braganca.

Thank you very much, Miguel. In Slide 70, you’ll see our strategic objectives in each of the geographies. So what we wants to be in Portugal as Millennium bcp is to be the best relationship bank in terms of experience, converging this human and digital experience for families and companies, which will position us as the key private sector player in the Portuguese sector, reaching the market share of 20% somewhat above our current market share and the number of active customers of around 2.3 million customers. In parallel, we have ActivoBank that is a bank focusing on acquisition of AB digital-first clients with a very distinctive daily banking proposition, which also emphasizes as its normal in digital banks value for money. This bank has been growing very fast and we continue to project a further growth of this bank, achieving around 700,000 active customers in this AB segment in the next years. In Poland, we aim to complement our position as a reference bank in acquisition of daily banking of individuals with primary relationships for SME in the SME market. So this is probably one of the strongest changes that we are doing in our strategy is this renewed emphasis on the SME, and by the way, also the micro business segment in Poland achieving a 14% per annum growth in corporate lending. In Mozambique, our main target is to be the main bank for families and companies with very, very strong risk control, so as to allow us to serve the customers with a very sound business model and without control surprises and positioning the bank particularly well for the eventual take-up of the country that will take place to know it. I will not go in detail in this – in Slide 71, because in the next slides, where I will go in detail in each one of these pillars. Going to the commercial banking in Portugal, so our strong focus will be in this connection between receivable financing and servicing and experience everything that has to do with a technologically-based first-class experience in terms of cash management and working capital finance, exploring partnerships, very easy end-to-end processes, both for the SME segment and for the micro segments – and for the micro segment elevating the service model to boost the proposition through technology and through our user experience commitments. And in parallel, we are also investing a lot in everything that has to do with the opportunities associated to the new structural investments, both linked to the climate transition opportunity and to the European Flash Portuguese recovery and resilience plan that we have already spoken about. And in this context, we will also recalibrate our risk return optimization. We aim to profit the most from all the data and all the models that we have through also once again through technology, so as to make sure that we are optimizing exactly this relationship and trading on not necessarily paying off volumes vis-à-vis profitability. This will enable us, in principle, to achieve the 20% market share in most of the products. Strongly focused on working capital finance satisfactory to double the lending stock to micro businesses and to originate more than €4 billion of loans to companies and to also have an increase in company funds to a large extent, core accounts and transactional accounts of around €2 billion. In terms of banking for individuals in Portugal, the Millennium bcp network. We will scale up the acquisition by innovating in our entry offer and reinforcing everything that has to do with digital and worksite models, adapted to both national and foreign target segments, which are new segments in the market. We also intend to profit from technology and data to expand our personal lending distribution reach and to reinforce our mortgage acquisition models. Through the platforms that we also have, we also intend to personalize, I will obviously to hyperpersonalize our interactions with customers, so as to make them as effective as possible, transforming also their experience exploring AI accessibility and this effective interaction. This will also be available not only for the upper mass market, but also for the affluent segment, where we will also leverage on these new forms of banking. A renewed focus on privacy and loyalty, we want really to transform some of our relationships where we are the second or third bank in first bank and also in bancassurance, where we are always a case study in Portugal, but we want to leverage on everything that we’ve learned to go one step further and to become a reference in Europe. ActivoBank, as I was commenting, we want to continue this very strong trend of customer acquisitions of good customer acquisitions focusing on this AB segment. The AB segment is the segment of the customers. They typically have university degrees and from a social economic perspective are on the highest end of the society. And this focus on the AB segment typically between 18 and 35. This is achieved through a leading position in terms of customer satisfaction and recommendation. And we also expect this to allow us to reach a cumulative net income in the period of more than €170 million. This will be done by strengthening the overall proposition through redesigned digital journeys to new formats for lending through new approaches to the market segment to enrich the investment propositions also with digital journeys and AI and transforming the whole service model so as to make sure that something where we are already top three in terms of experience of the customers that we really become also a reference in Europe and in the world. All of these through technology, data, AI and people, I would like to emphasize this issue of data and AI. BCP was founded in 1985 and at its inception was a bank that in its DNA, had, I would say, two very important dimensions. Relationship banking/segmentation, it was a case study in several universities and with several customers that you can see, some of them in INSEAD but also in technology.

, : So we have an additional credibility when we speak about data, technology, AI and process transformation. This DNA that we have, the systems that we have, of course, will enable us to have – to continue to have a competitive advantage. And now, we are allocating, so to say, our efforts to process transformation to this GenAI massive deployment expansion to review our data architecture, so as to be state-of-the-art and to be able to profit from all these data to also to allow migration of technology to state-of-the-art processes and to have an IT factory that will step up agility and performance, allowing us as you see in the benchmarks and in the data that you have on the right-hand side, to have a more than 30% productivity improvement in operational back office and more than 50,000 hours – office hours saved per year from bench processes digitalization. So we really take this very seriously. In parallel, we are migrating that of our core system to new cloud-based platforms and we are digitalizing almost all our servicing journeys. In this context, we are also taking the issues of bank’s resilience very, very seriously in terms of fiber, in terms of everything that are lines of defense. We also aim to be state-of-the-art in this context. And technology and confidence of the customers, both in terms of data and in terms of cyber, and the preference of the customers go all hand in hand. And of course, all of this is not possible with our people. We are also very committed to motivating our people selecting, training our people. This will imply a talent pool reinforcement. This will imply also some changes in the composition of our workforce with more people from technology and from lines of defense and from, I would say, data and CRM and in per central terms, less people for more traditional banking. In terms of Poland, as we have commented and as it was presented in Poland, the important difference is this renewed focus on corporate and micro business. So what we want is to convert ourselves from a bank that is excellent in terms of individual customer acquisition, where we are clearly ranked top two in terms of acquisition of current accounts, acquisition of nominees and so on of a bank that is also state-of-the-art and it’s also a benchmark in terms of acquisition of micro businesses and corporates. This will allow us to, as you see, next page to double our scale in corporate banking going from €13.6 billion loans, €136 billion Zlotys in corporate loans to more than €25 billion, also doubling the number of corporate banking clients. At the same time, at which we are growing our customer base from 3.1 million customers to 3.7 million customers in this four-year period, but not only growing the number of customers, but also growing the quality of the relationships where we intends to have a share of 70% of all our retail customers will consider as our – will consider Millennium their primary bank. This will allow us to reach a return on equity around 18%. Mozambique, Mozambique is a country that we know well. We are there already for some decades. We are a reference bank in terms of serving the Mozambican market. And basically, our focus in Mozambique is to continue to be there to serve the market in a quite low risk business model, but with a very, very strong internal controls, a very, very strong fraud prevention mechanisms, cyber precision [ph] mechanism. So we don’t want to have any type of surprises in Mozambique, while we build our platform to allow us to benefit from the moment at which the country will start to grow as some of the international agencies are forecasting it to grow. In the meantime, to maintain our strong profitability where we typically have almost 20% ROE on a consistent basis. So recapping the targets that Miguel Maya has commented, these are our targets for 2028. I will only stress that in some targets are greater than the value. So our target is these are limits, so to say, it’s not where we want to get. It’s the minimum that we want to get. And we really feel that this is something that is achievable. We have proven to have a very good execution capability. We have proven to have competitive advantages and capabilities that allow us to enter in this new phase with a high perspective of success. Thank you very much. Open the floor now.

Thank you. [Operator Instructions] Thank you. We will now take our first question it’s from Maksym Mishyn from JB Capital. Please go ahead.

Hi, good afternoon. Thank you very much for the presentation and taking our questions. I have two questions if I may. The first one is on your guidance for capital distribution. It implies you want to keep a buffer over the 13.5% Common Equity Tier 1. And I was wondering if you could provide us with a little bit of color why do you prepare for an organic growth? Are you many some additional investments? And what would be the trigger to distribute this capital back to shareholders and lower the CET1 to 13.5%. And then the second question, could you please walk us through the NII sensitivity in Portugal? And how are you managing it for the next year? Also what kind of contribution from Portugal do you expect in 2028? And what will the past be in terms of year-on-year variation of NII until 2028. Thank you.

Maks, thank you very much for your questions. As I was commenting, there are here some targets that are more or less that are greater than. So when we say that we want to have a CET1 ratio higher than 13.5%. This means that it is higher than 13.5%. It’s not it is 13.5%, this means that if we go below the 13.5%, we would not be achieving our plan, but this is more a trends to this level than anything else. Let’s see how the world evolves. The world has its complexity. Let’s see exactly as we grow more and more in the corporate sector, both in Poland and in Portugal. How – what will be the risk-weighted asset density of this strategy, I would like to recall that we have been performing very well in terms of capital. But a part of this very good performance is for, I would say, not so good reason is that we have not been growing in the corporate sector. So as we start growing more and more in the corporate sector, it is normal that the RWA density will increase if time goes well, of course, the bank will not be in an autopilot fashion. Yes. What we know is that we will, for the moment, distribute up to 75%. Let’s see how the world evolves and let’s see then exactly where to go. But for the moment, our commitment and our projections have these smooth, I would say, decrease of the capital ratio based on growth. I would like to end on a very solid ROE, where we are converging to 13.5%. But as you correctly point out, if you use the numbers, you reach by 2028 the value that is based on the most likely scenario, somewhat higher than 13.5%. In terms of the NII sensitivity, how do – are we seeing it? As we know, 2023 was an exceptional year in terms of NII, because basically the interest rates went up. And in the first nine months of the year, only a small part of this increase in interest rates was passed through the term deposit rates because the banks were awash with lease liquidity. In the last quarter of 2023, the EBITDA, as you say, of the deposits started to grow. And effectively, there was some growth in terms of the deposit rate. So that the – this year, there was some decrease in terms of the NII of 2024 vis-à-vis the NII of 2023, a decrease that is somewhat stabilizing, if you do the numbers of we had a sharp decrease in Q1 from Q4 of 2023 vis-à-vis Q1 of 2024 but then it started to stabilize. So the recurrent or decreases that occurs after it were quite small. In this quarter is slight – that we had decreased at or slightly above 1% quarter-on-quarter, which is not so relevant considering the situation that we have in terms of interest rates, so. Going forward, how do we see it? We see that for the current environment of interest rates, 2025 for the current environment of forward interest rates, where we are reaching levels of Euribor between 2% and 2.5% in the second half of last year, so to say. We do expect our margin to be broadly constant. It may come down a little bit. We are speaking about single-digit number. So may go up a single digit, may go not single digit, we are speaking about 25% to be broadly constant vis-à-vis 2024 because of these factors and decrease in interest rates. We are then expecting as it is implicit in the forward rates for interest rates to stabilize around these levels between 2% and 2.25%, and assuming that we will be stabilizing around these levels. Then NII, NII will start to grow of levels of mid-single digit, more or less aligned with volume growth. So that’s what we are expecting in Portugal. The sensitivity is quite low as we have commented in previous circumstances, the sensitivity of the NII in Portugal has been around €50 million to €60 million for each 1 percentage point of decrease of the arrival per year, of course. So we have a low sensitivity, but even with a low sensitivity when interest rates go down very sharply, we have these impacts. In any case, what is implicit in these numbers are these levels of Euribor, the levels increase in the forward curves both for the Euribor in Portugal and for the Viber in Poland. By the way, the Viber in Poland, what is implicit is what is something around a decrease of 2 percentage points until end of 2026. So we think we are being prudent enough in terms of the scenarios that we are developing. As I have commented in the – when we spoke and I have been very consistent on this issue when we spoke at the end of 2023. What we commented is that for 2023, 2024, I can say also for 2025 at least for Portugal, we expect to be able to maintain the extraordinary profit that we have in 2023 compensating some decrease of the NII, such as we have in 2024 with other lines of the income statement mainly in terms of impairments, the impairments because, of course, the customers also benefit from a lower interest rate scenario. That compensates this. So our results in Portugal will be maintained in principle, of course, in 2024 and 2025 comparing with an exceptional year that was 2023. In the – after 2025 because exactly we expect the interest rates to stabilize that levels of 2% to 2.25%, we will start going much more heavily based on the margin growth on volume growth.

Thank you very much, Miguel.

Thank you. We’ll now take our next question. This is from Ignacio Ulargui from BNP Paribas Exane. Please go ahead.

Thank you very much for the presentation and for taking my questions. I have two questions. The first one is, I’m looking to cost of risk. I mean, if I just look to the cost of risk guidance of 45 basis points for Portugal. I mean if I just compare what BCP used to be long-term ago and what it is today, I think that the NPE reduction has been enormous. And I struggle to see why you need to have such a gap of provisions with your competitors in the context of a rapidly benign economic growth in the coming three years. So we just wanted to get a bit of a sense whether you feel that, that 45 basis points in Portugal are conservative and give you some potential upside? And the second one is, whether you could help us to work on the potential impact from Basel IV in first time adoption and the fully loaded impact and whether the excess capital that you have potentially over that 13.5% could be invested in trying to improve further fee-generative businesses, like asset management or insurance. Thank you.

…:

RTS.

I’m sorry, RTS, it is not SRTs, RTS’, some RTS’ because there are still some results on interpretations of how to allocate operational risk trading risk and so on. And we are waiting for the final RTS’ as soon as we have the final RTS’, we will communicate to the market what will be the expected impact. In terms of investing in fee-generating businesses, I mean, we don't have any – I can say we don't have any – anything a priority against or for a business if it makes sense. What happens very often is that both asset management businesses or insurance businesses. Are businesses that needs to have a certain scale and the economies of scale, and they often this scale is not achievable at a single country or even at the two country levels. So this is not in our strategic plan. Also, we would have commented it. Of course, the strategic plan is not everything. So if there is an opportunity, we may look at it. But our first stance is that we should not enter in businesses where you need European or global scale. So this is our first instance. But of course – and so this is not in our plan for the time being. In terms of the cost of risk, I think you are right when you say that there are some, I would say, upside potential in the evolution of our credit risk and mainly the gap vis-à-vis the competitors should shrink. But we also have to be very careful when we see this gap because what happened with some of our competitors is that for different reasons, they have frontloaded a lot of provisions because they had excess capital, they have to justify or they had a state-sponsored acquisitions or I don't want to enter into any details, but they have the motivation, so to say to upfront a lot of provisions, which means that at least in the years after this front loading, they did not have to do impairments. So a part of the impairments of our competitors is not totally sustainable also. It is a product of the fact that they have front loader provisions. I hope so – but I think that if things go well in Portugal, as I would like here also to stress, when we say it's lower than – is lower than when you say the cost of risk is lower than 45 basis points in Portugal, does not mean that it is 45 basis points. It means that it will be lower than 45 basis points. But of course, when we are growing also in credit, in the first moment of growth, mainly when you want to enter new clients and so on, there is some additional risk that you have to take. So all in all, I think this is balanced. I think that the risks of non-compliant with this cost of risk in a scenario where there is not a dramatic recession in Europe. So I think it's more skewed to the upside. But also saying the contrary, I would say there are probably some risks also a little bit to the downside due to the competitive environment also in the revenue side because, of course, we cannot anticipate exactly what our competitors will be doing. And if they feel our aggressiveness in terms of growing the corporate sector in terms of capturing clients and so on. I mean we cannot totally anticipate what will be the new spreads in the market. So all in all, I think the plan is a balanced plan with, I would say, some positive risks potentially in the cost of risk with, I would say, some challenge, mainly linked to the strategy that may be followed in a very competitive market in the NII and commissions. So all in all, I think it's a balanced plan.

Thank you very much.

Thank you. We'll now take our next question. This is from Alvaro Fernandez from UBS. Please go ahead.

Hello, good afternoon and thanks for the presentation. I have two questions. First, if we were to see a scenario in which credit demand is lower than expected and you don't manage to meet your ambitious loan growth targets, and therefore, you don't use that excess capital, would you be willing to increase the payout even further or rather explore non-organic growth opportunities such as, I don't know, buying minorities in Poland or a potential merger with Novo Banco? And second, you target a net interest income ranging between €3.1 billion and €3.5 billion by 2028 with ECB rates landing at some point between 2.25%. So my question is, what would the NII be in a scenario in which ECB rates fall to levels closer to 1%?

Starting with the last question. Of course, it will depend on our positioning in terms of our balance sheet at the moment. So as I'm commenting, the bank will not be in autopilot. So if we – if the ECB kept the rates very fast, and we do not anticipate it, it's one thing. If we anticipate and position the balance sheet to profit from this. It's another thing. What I can tell you is that at the moment, we have a relatively low risk in terms of pure interest rate risk. So our EVA sensitivity is very low, and our sensitivity of our NII to 1% changes in interest rates is also quite low. As I was commenting, between €50 million and €60 million for each 100 basis points of change. If you want to use this as a reference, assuming that we will have the same sensitivity later on, you can use this as a reference. But of course, everything depends on what we do in the meantime because we don't go on holidays for the next three years. So we position the bank. And we are – and if we see that there is a risk that the interest rates go much below the interest rate that is foreseen in the plan that we have right now, probably we would increase our hedge, but it's something to be seen. So it's quite complex to comment this. Also, it depends – in terms of the total commitment that we are presenting to the market, probably one of the main variables for the fact that we are presenting an interval between €4 billion and €4.5 billion is exactly the level of interest rates. Because the issue is not particularly, as I was commenting, the pure interest rate risk is more the pricing risk of the spreads of deposits. So one thing is the interest rate goes down and the competitors all react and pass through these interest rate to deposits on a one-to-one basis. The other thing is interest rates go up or down, but then the pass-through is much lower or is much higher. So there is a competitive element here that is particularly hard to anticipate as we've seen in 2023, the interest rates went up and the competitors were very keen not to increase immediately the interest rates. So we cannot project exactly because we, unfortunately, will not sit on the boards of our competitors to know what will happen in these type of scenarios. So the pure interest rate risk is low. The competitive element may have some impact. And that's why we are presenting this interval between 4 and 4.5. I would say the main element for this interval is if the interest rate goes down, and if the EBITDA, so to say, of the decrease in interest rate is low. So if the interest rates go down and the EBITDA – they are not passed through the deposits to the clients. So that effectively, the deposit rates, the time deposit spreads reduced a lot. We will be much closer to the €4 billion if interest rates go up, which may happen over a four-year period or stay stable, so to say, instead of going down, we will be probably much closer to the €4.5 billion. Okay?

Okay. Thanks. And on the first question.

Okay. In terms of the first question, I mean, we don't have – I mean, for us, strategy is in separately from value, and that's one of the reasons why our strategy presentation is named Valorizar. So we compare the alternatives and see what generates more value for the different stakeholders, of course, including the shareholders. So we would always compare any potential acquisition to a distribution and see what more accretive and what makes more sense for our shareholders. So the quick answer to your question is that it depends – it depends on what creates more value added at a specific point in time, and we will compare based on specific values. What I can tell you is that we have the luxury of not needing to do any type of acquisition. So we don't need to do if there is the possibility of an acquisition, we would always compare this with the alternatives like distributing them to the shareholders. And we would, of course, only go further with it if it clearly makes sense in terms of value for shareholders in terms of accretion in terms of earnings and so on. So there is not an abstract answer, there will only be a concrete answer based on the concrete values.

Okay, thanks.

We'll now take our next question. This is from Noemi Peruch from Mediobanca. Please go ahead.

Good afternoon. I have a few questions. The first one is on the sustainability of the 75% payout. So you mentioned that it is a subject, among other things, to business targets in Portugal and in the international area. So what would this mean for 2025? So basically, in other words, what could happen for you not to continue paying 75% stably across the plan. And then on the share buyback. Will it be executed in the market or to a specific shareholder and what is the time line for it? And then the last one is a clarification. I think you indicated 2025, 2024 was just I wanted to make sure that you are referring to the net profit in Portugal or at group level or something else? Thank you very much.

Okay. I mean, the conditions that we think are important to up to 75% are the ones that are here is that we deliver on the plan and we deliver on the plan on a sustainable basis. So to say, if we make, let's say, the €4 billion for whatever reason, just to give you an absurd, an absurd example in Mozambique, probably it would not make sense and for whatever reason, we cannot distribute dividends to the mother company. It will not make some sense of course, to distribute everything to the shareholders, just for sake of example. So it needs – we need to hit our targets. If we make a target with a one-off that then will be disconsidered the year after, for instance, is also another thing. So we have a plan. The plan has several dimensions and is based on the sustainability of business models. It's not based on one-offs. We have a plan that is dependent on as being resilient. And so we have – and this will also allow us to have the appropriate ratings, to have the appropriate consideration in the market and so on. So we will not distribute value that will jeopardize our ratings just for sake of example. So we are confident that if we deliver the plan, if we deliver the plan in the different geographies, and you cannot sum apples with oranges totally that we will be able to distribute up to 75%. And that we will also convince the supervisor that this is appropriate that we are taking the proper and the reasonable decision. So the plan is a plan, and we think that we will deliver it. If we do not deliver in the plan, if we do not deliver the plan for whatever reason, because the type either we do not hit the return or we do not hit the capital target or we do not hit this on a sustainable basis because it's based on one-offs and not on real customer business like everything in a trading game, so to say. Probably, we would have to reconsider the share buyback. But this is our plan. So we have a plan. We have a plan to get there, and we feel confident that we will deliver on the plan. And if we deliver on the plan, we will feel comfortable that we will be able to deliver on the several dimensions of the plan. So this is what I would like to stress. In terms of the share buyback. Let's separate you two things. We are – actually, we already have sent to the supervisor with the decision was taken yesterday. We have already sent to supervisors, the request for an authorization for a share buyback that is somehow related to the 2024 income, so to say. So this is for 2024, and we have already requested it, okay. For 2025, 2026, 2027 and 2028, we will also request separate plans, so to say, every year based on the results that will be aligned with this decision that we are presenting to you. So in terms of how to organize it, we will organize it as it's normal in Europe and the reference banks typically do. So we will assure an independent institution to do it for us. We will treat, all of the shareholders. So it will not be a targeted share buyback. It will be in the market. We will give all the shareholders the opportunities to do it. We will do it in the plain vanilla way as other European banks are doing to not be targeted. It will be simple. It will be transparent. It will be according also to EVA guidelines using the safe harbor rules that allow us to make sure that we treat all the shareholders fairly. And of course – I'm sorry, this is for consolidated profit. So it is the estimated consolidated – of course, as of today, we don't know yet what will be the 2024 net income, so to say. So the authorization that we have asked for the supervisor is based on, and we cannot communicate to the market the exact value, but he is on an estimated value of the profit – of the consolidated profit of this year.

Thank you.

Thank you. We'll now take our next question. This is from Sofie Peterzens from JPMorgan. Please go ahead.

Hi. This is Sofie from JPMorgan. Thanks for taking my question. I was just wondering on Page 19 in the strategic plan. The 2024 net interest income is €2.5 billion, €2.7 billion as a starting point. But if I look at your – kind of nine-month run rate. Net interest income should be more like €2.8 billion. So I'm just wondering what I'm missing when I read this slide. And then my second question would be around Swiss franc mortgage provisions. You mentioned that you expect that to come down. But kind of assumed by 2028, there won’t be any Swiss franc mortgage provisions? And how should we think about the any Swiss franc mortgage provisions in 2025 and 2026. Thank you.

Starting with the Swiss franc mortgage provisions. As I have commented before, 2024, our expectation, and it's been confirmed by what is happening is that 2023 would have been the number with the highest value in terms of Swiss francs. Provisioning, okay? This is what we expect to be the value for the 2023 – I'm sorry, 2023 would be the year with the highest value for the Swiss franc mortgage provision, okay? This is happening, as you are seeing in our income statement that we have just presented, 2024 is already below 2023 in a high amount in 2023. So we have already reached the height and it's going down, okay. For 2025, as I was – I have commented in the past, we will have a strong drop vis-à-vis 2024 a strong drop vis-à-vis 2024, but still a material value. Exactly the value, I cannot comment not least because the bank is listed also on its own. And I don't know exactly by heart what was the latest communication to the market, but it will be still a material value, but clearly below 2024 and of course, clearly below 2023, okay? And from 2025 onwards, we are speaking about values that will be much slower, much slower. So 2026, 2027 and 2028, we are speaking about that much lower. Of course, as time goes by, it becomes more difficult. But why am I saying this? I think this is important to share this with you. Our methodology is based on a three-year forward-looking methodology that considers the cases that we expect to come to court in the next three years. So what we have right now already considers the cases that we expect to come to court in the next three years, so until 2027. So this saga started in 2019. So we don't – so the provisions that we are – that we will be doing in 2025 based on the expected cases until 2028. So we don't expect that – someone that has not filed a case until 2028. I mean, the number of cases that have not filed the case in the court until 2028, we'll file in 2029. So we expect 2025 to be the last year with a very material provisions. In 2026, and afterwards, we may have some provisions, but they will not be very material in the context of the group. So that's what we are expecting. In terms of the NII, there was a typo in the first version of the graph, I don't know where you have seen it. We have the recent – the presentation to the CMVM and so on. So the last value of the NII projection for 2024 and for 2028 is the one that I'm now presenting and it's the one that is now filed in the market. And this – if you see this is more or less the upper part of the interval is more or less aligned with the run rate that we had in the last quarter.

Okay. So the starting point does not change at the endpoint in 2028?

Not materially, no. We think this interval, yes.

Okay. That's very clear. And if I may – I know you already commented a bit on kind of inorganic growth opportunities and you guys will way against any share buyback or any kind of remuneration against shareholders. But if you could maybe also just share with us your thinking around kind of M&A opportunities in Portugal and more broadly in Europe. And what are your thoughts also on disposing potentially Poland. Would that be something that you could consider?

Okay. Okay. I mean, of course, within the context of our strategic plan, we analyze organic and inorganic possibilities. And one thing for us was absolutely clear is that in spite of it not being the most, I would say, sexy story to present to the market. We think that what is really important to our shareholders is value. And if we have a strategy that is performing well and that's securing value, we have to stick to it. So I think this is important. So we analyze opportunities. We analyze possibilities to go beyond banking in some areas. We analyze markets. But finally, we decided that for several reasons. As of today, this should not be part of our strategy. I think as Michael Porter once said, strategy is more defined by what you don't decide to do than by what you decide to do. But I think this is very important in terms of discipline. So we are not going to other markets. We are not going to other businesses that go materially beyond banking. So I think this is very important. Then in the markets in which we are right now, we do think, as you see here, I mean, we are reaching $3.7 million customers in Poland. We are getting to a market share that will let us be a relevant player in Poland. So for a bank of our size and for a bank of our capital, we think we are adequately served. So we are not intending right now to explore inorganic possibilities in Poland. So we're not going to the market. We are not going to expand inorganic positives in Poland. And for other reasons, I mean, we are also not looking at inorganic possibility in Africa. So in terms of our risk appetite for the moment that we are right now in the world, we don't think it makes sense for us. So this leaves us only with Portugal at the end of the day. So – and in Portugal, it is as we have already commented several times. So we have to compare very well. And the [indiscernible] is there an opportunity that accrues more value to our shareholders than a share buyback I think this is the comparison that we have to do. If there is, of course, we explore it. If there isn't, we will probably would go the other way, but we don't have any intention. We don't need it. So we don't need it. We don't have any intention to do it. So only – as any professional will do, if it is really something that includes a lot of value to our shareholders, which is not, by the way, our base case right now because for it to accrue a lot of value for the shareholders, it would have to be – it would have to be a price that probably is not the price at which the sellers of the different assets right now would be willing to sell.

That's very clear. Thank you.

Thank you. We will now take our next question. This is from Francisco Riquel from Alantra. Please go ahead.

Yes, thank you for the presentation and for taking my questions. The first one, I see that the plan commercially has an ambition to growing companies much more than in individuals. So €4 billion growth in Portugal and you have been deleveraging to date in the corporate loan book. Doubling the corporate loan book in Poland and Mozambique. So I wonder how can you reassure us that you will be gaining market share in corporate in a profitable way preserving the risk profile? And what will you be changing in the business model commercially to achieve these targets? And then my second question is on deposits, which is the main growth drivers in revenues as per your previous slide. In the NII, I wonder if you can share with us a bit more of the assumptions of this uplift in the deposit revenues particularly more in the Portuguese business, what weight of term deposits? I see that this is still rising in the third quarter to close to 50%. What type of deposit beta? So any assumptions that you’re embedding in this plan? Thank you.

Okay. Starting with the deposits, the deposits right now, we have deposit betas considering demand deposits and term deposits together around 24%, 25%. And because of the demand deposits if we only consider the term deposits, they are very close to 50%. Of course, the concept of deposit beta when you have rates going up and down is very complex because how you measure it, where we measure it from the bottom, where you measure it through the cycle, where we measure it from the top, you reach very, very different values. But this is more or less where we stand. And the composition of term deposits and demand deposits right now and already for some months is being broadly constant. The issue that you asked is, how can you be sure to deliver on your ambitious plan in terms of corporate loan growth? I think this is a good question. There is not a simple answer to this question, except that what differentiates us as an organization from other banks is our execution capabilities, our track record. So typically, when we say we will do something, we do, because I mean, of course, when we were delivering this or preparing this plan, we looked at the plans of some of our competitors. And to be honest to you, it was a little bit frustrating because when we compare it with the plan with some of our competitors, we saw, I mean, the banks ask many of them saying more or less the same priorities and highlighting the same issues. So what differentiates us? And that’s why also in the first part of our presentation, we stressed so much what we have done until now. We have stressed this for two reasons. The first reason is to show that we have a good starting point. The second reason is to show that we have execution capability and there is one thing that characterizes BCP is that when something is a priority. And when we really focus on delivering on something we typically, as we have seen with the reduction of NPEs, as you’ve seen with the turnaround of the bank, as you’ve seen when we were the first bank, for instance, in the state-sponsored COVID lines, is that we typically deliver on it. So of course, we will have to adjust our risk return profile. We will have to reallocate the priorities of our people to this mission in terms of making sure that we will use technology and data to serve our corporate clients better, these invite choices but there is not much more than I can tell you then. We have a good starting point. We have a good technology. We have good people, and we have shown in the past that we have execution capability.

Thank you.

Thank you. We’ll now take our next question. This is from Carlos Peixoto from CaixaBank. Please go ahead.

Yes. Hi, good afternoon. Three questions from my side. The first one, I apologize before and it might be a bit long. But – well, if I understood correctly, you had mentioned net profit running in Portugal are earnings roughly stable in 2024 versus 2023 and then also flat in 2025. But looking at 2024, you’re already in the nine months, you already with €600 million. The 2023 were €725 million. So this would imply something in the areas of €125 million in the fourth quarter which is well below what has been the run rate up until now. My question around this would be what would explain this? If I understood correctly, you expect NII in the fourth quarter to decline marginally to be close to this year levels. And then in 2025 to be broadly stable, if I understood correctly. So is it the provisions which has a bit of a jump in the third quarter? Should we expect another figure like this or even higher in the 4Q? Just trying to understand a bit the moving parts to get to that figure. It would be very helpful. And then the second question would actually be on costs. So from your business plan, I take it that you’re assuming roughly between 5% to 7% CAGR, compound annual growth in costs over the next four years. The question here is how flexible do you see on this front to adapt if the evolution on the top line ends up not being as favorable as the one seen in the plan? What level of flexibility that could exist here on the cost side to adapt to that situation? And then finally, within the – I remember in the previous call, you mentioned something in the area of €800 million of balance sheet DTAs, which might be somewhat recoverable or part of them. I was wondering within the scope of this business plan and within the improvements in net profit embedded in it. What type of recovery of these DTAs could take place? Or is something – or is anything out of this embedded in the business plan at this stage? Thank you very much.

Okay. So starting with your first question. What we have always said, and we have been very consistent on to it and we tend to be consistent, we tend to deliver on what we promise. And what we have always said since the end of last year is that we will be able to replicate in 2024 in principle in Portugal. Broadly the same type of results that we had in 2023 in spite of a much lower interest rate environment that will then be impacted at the NIM level. So we have been very consistent in saying this. We were fortunate. Fortunate is a wrong word, but there were some extraordinaries in some of the quarters of 2024. In Q2, there was a special recovery of €50 million, as we have commented in terms of cost of risk that actually we repeated also today. In the Q3, we had the sale of – I’m sorry, the sale of a portfolio of loans that also had an impact of more than €30 million. So there were some extraordinary gains that do not necessarily occur in Q4 almost by definition. And it’s also normal in a year where you have extraordinary gains, also to be somewhat more prudent in terms of provisions. So for the moment, I will not go much deeper into it. But the run rate has to be, I mean, taken out of extraordinary gains, and we have to be seen especially in years where you have extraordinary gains, it makes sense to make your balance sheet [indiscernible] statement even more resilient. In terms of IT costs, I am sorry, in terms of cost, how flexible our cost structure is. I would say there are two degrees of flexibility. One degree of flexibility is if we think that some of the initiatives that we are investing in to grow, don’t have ceased to make sense because, let’s say, I mean, the situation in Europe is more recessionary than the one that we are anticipating. And this would mean that we would delay IT costs that we would delay some of the recruitment of special type of people for these initiatives. So there is, I would say, some flexibility in terms of the not investing or not incurring in the costs necessary for the strategic initiatives if the strategic initiatives cease to make sense, okay? Because this will not be a one-off, it will be over time. If we have for whatever reason, which is not on our base case and our business plan was not based on this assumption. If we have a major recession in Portugal or in Europe, which, by the way, is not, of course, the full plan would have to be reduced, but I would not – I will not go into this one and a specific scenario. We do not think it makes sense to, I mean, to anticipate what would occur if there is a totally different scenario right now. But of course, what we can tell you is that if the scenario is totally different from the one that we are seeing here, we would have to review the plan. And of course, if the situation is totally different from the one that we are anticipating here, the strategy would also be totally different and would be much more. So we are here in a strategy of growth and productivity, achieving productivity through growth, okay? And this is based on the macro scenario that we have just presented to you. If this becomes for whatever reason, impossible, let’s say, a war in Europe, let’s say, something like that. Of course, we would have to go back to the drawing board and redo the strategy and appoint a new strategy day with you, okay? In terms of recovery of the DTAs, I would say that, as you know, there has been some discussion also in Portugal. In terms of the tax rate, where the tax rate goes up or goes down and the impact that this may have and this may have an upfront impact and so on. So this 1% reduction in the tax rate that is more or less – that has been more or less announced by the government, but it has not been approved yet in the parliament is already somehow implicit in the plan. Going beyond it and going I would say there is not any extraordinaries linked to taxes in this plan. By extraordinary I mean, there are either impacts of higher decreases in tax rates going forward, not any material write on of the DTAs in the plan. Not least because as you know, this does not contribute to the capital ratio. So it would not be necessarily – I mean, not being necessarily more capability to distribute dividends to our shareholders.

Thank you. We’ll now take the next question. This is from Pamela Zuluaga from Morgan Stanley. Please go ahead.

Good afternoon. Thank you very much. I want to ask a follow-up question on your volume growth comments. What are the main specific drivers behind the loan and deposit growth targets? Is there a catalyst behind demand other than changing rates? And on your ROE target above 13.5%, can you give us more details around the capital trajectory to reach this profitability level? Thank you.

So the capital – the ROE target that we are presenting as the average ROE for the period that, by the way, you have to look at in conjunction with the target of percent of increase in tangible book value plus dividend yield because I think you have to look at them together of 15%. So we are speaking about in one case of 15%, in the case of ROE of 3.5% [ph] are two very important targets. In terms of the capital trajectory, of course, the way we look at it is that it is very dependent on the distribution to the shareholders, and what we are saying in terms of distribution to the shareholders is that we will distribute to the shareholders up to 75% of our income. If we are able to distribute the 75%, we will, in a smooth way, arrive at a level that as Maksym [ph] has anticipated, is somewhat above the 13.5%, but it will be, I would say, not totally linear, but almost linear path to this capital target. So if you do the numbers, if you do the modeling, you probably reach, it will be a smooth path to a level that will be at the end somewhat above the 13.5% of CET1. Volume growth, I mean, volume growth, these are volume growth that the bank has been able to deliver in the past. So we are speaking about here volume growth in Portugal that are slightly above nominal GDP growth. So if some inflation plus real GDP, I mean, these are perfectly aligned with [indiscernible] with some increase of market share, but not too much. We are saying increase of market share of around 18% in most of the products to around 20% in some of the products over a four-year period. So this seems perfectly consistent. In terms of the main levers, this was what a little bit what we tried to explain in the slides in the fact that we have presented. So if you go to the presentation of the plan, you see that you have pages for Portugal, pages for, for instance, in the corporate area in terms of supply chain finance initiatives, in terms of new partnerships. I mean it’s – there’s a lot of – there’s not one silver – unfortunately, there’s not one silver bullet. There are a lot of initiatives, a lot of work a lot of small things or medium things that can contribute to these results.

Thank you.

Okay.

Thank you. We’ll now take our next question. This is from Hugo Cruz from KBW. Please go ahead.

Hi. Thanks a lot for the plan and for the time. I have two questions. Apologies if you’ve been asked already. One is around interim dividends? Have you thought about introducing an interim as part of your 50% cash payout? And second, can you tell us about how you expect to use interest rate swaps in Portugal throughout the plan? Where do you use them in the balance sheet in the assets and liabilities and particularly duration and daily amount? If you could give us a bit of color on that would be very helpful. Thank you.

Okay. Okay. So in terms of interim dividends, I mean, we are not thinking of how doing this because it would increase an additional complexity. We are not seeing – I mean, most of our investors, most of our shareholders are valuing it. It would imply probably special authorizations another AGM, so we do not see a lot of value for this from our shareholders. Of course, if in the meantime, we see that our shareholders values a lot, it’s always something that we can rethink. But as of today, we do not see – we are not seeing enough interest that would justify the additional complexity of interim dividends, okay? So it’s not projecting the plan, but we do not have any prejudice again. It’s only to simplify our life. In terms of interest rate swaps, so we manage the interest rate risk of the bank in an integrated way. So what we try to do is to target a sensitivity of the NII and sensitivity of, so to say, the market value of the bank or to be the market value of the interest rate risk of the bank, okay? For this, we use basically two instruments. One instrument is the ALCO [ph] portfolio that we typically by government or state agency bonds to make sure that we hedge our interest rate risk. The other instrument is through interest rate swaps. In order to make sure that from an accounting perspective, these interest rate swaps do not generate a volatility that does not make economic sense. We use two types of accounting mechanisms. We can use these interest rate swaps as cash flow hedges for loans, typically mortgage loans. So we classify some mortgage loans that are floating rate as being hedged by interest rate swaps or we use these interest rate swaps immediately to hedge non-maturity deposits, typically demand deposits. Then the periods of this – or the maturity of these interest rate swaps is aligned with the period of the repricing of the liabilities that we have. So what I can tell you, of course, I mean we have different assets and different liabilities. Each one has its own maturity profile. But in terms of our modeling, a large part of our non-maturity deposits, because of EBA guidelines, our model has been for interest rate risk purposes as repricing on a 4.5- to five-year period. So this means that in terms of interest rate risk, we typically tend to hedge this economic value of our balance sheet. To a large extent, in this period that is somehow regulatorily framed, so to say.

Okay. Can you tell us how much of those deposits you hedge normally? And is it a mechanical process or do you – are you able to kind of turn on and off kind of the hedging for those deposits?

What I can tell – I mean it depends a lot – because we have to look at the full balance sheet because the deposits are only one side of the coin. You also have the asset side, so I can tell you that most recently, which is we have been growing somewhat our mortgage book that is five-year fixed, so to say. So we look at it in an integrated way. So what I can tell you is that we do it on a regular way. Every month, we make sure that our interest rate risk of the banking book, if you want, has a relatively low interest rate exposure, so to say. So it’s done on a monthly basis. The decision is taken on a monthly basis typically for the month after. And we typically have an EV, as you may see in our report, EV, the economic value sensitivity that is very, very low. So if you ask me, I mean almost all the net position of the demand deposits is hedged to make it simple. So that’s why I say that our risk is not the risk of the pure interest rate risk, because this is very, very much hedge. It’s much more the competitive spread risk than anything else, and this is more difficult to hedge.

Really helpful. Thank you very much.

Thank you. We’ll now take our next question. This is from Miruna Chirea from Jefferies. Please go ahead.

Good afternoon. Thank you very much for taking my question. And sorry to go back to the customer margins in Portugal. But could you tell us what level of compression you had in your asset margins in Q3 and with the current level of hedging that you have in place. What asset beta you would expect to see from here? And also what the cost of deposits in Portugal in the quarter? And then secondly, I was wondering on the shape of the 75% cumulative payout over 25%, 28% that you guided for or rather the 25% extraordinary payout on top of the 50% ordinary. Do you think it’s going to be around 25% per year? Or should we expect this to be a bit more back-end loaded? And then I was wondering in terms of the timing of the buyback, how long would you expect a 25% of profits buyback to last for in terms of months? Thank you.

Starting with the issue, I mean, the issue of the – exactly our cost of deposits and what are we doing and so on is commercially sensitive information and so it’s not something that we are disclosing right now as our competitors are not also disclosing. So I will not be able to comment on this. What I can tell you is that as of now, we have a margin that is, as you’ve seen in Q3, that is being very stable. And in spite of the reduction in interest rates, we have been able to pass through a large part of the interest rate – of the recent interest rate hikes to the customers to the deposits as our market is also being able to do, of course, less than 50% because this is still early days. But the way to – I mean, to model it is we would expect Q4 to be broadly aligned with Q3, maybe a little bit below. It still depends on what the competitors will do. As I comment I mean this has much more to do with what the competitors will do than anything else. And for next year, we are also expecting some stability in terms of NII, assuming that we are able to pass through in this decreasing of interest rates on term deposits around 50%, not immediate, but around 50% of the deposits of [indiscernible]. So I think this gives you already an idea of where we are getting to. In terms of the share buyback, when we say up to 25% is up to 25%. Our objective right now is to do it every year based on the consolidated profit of every year. This is what we would intend to do. Of course, it depends on all the conditions that we have commented. In terms of how much time it will take and so on, we will follow the EBA safe harbor provisions in terms of making sure that the amounts that we buy in the market do not interfere unduly with market prices. This means that it is not exempted possible to determine exactly how much time it will take because it depends on the average daily trading volume of each of our security. So for me, it’s right now, it’s difficult to anticipate. But your guess will be as good as mine. We will be using here the normal standard processes for safe harbor regulations, and so on, and it will be the same for us as it has been for some of the banks that have been active in the market in this issue like the Italian banks and so on.

Thank you. And there are no further questions at this time. So I will now hand the conference back to the speakers.

So thank you very much for following us, and thank you very much for your vote of confidence and for staying yesterday at night, I mean, preparing your first analysis of our strategic plan. Also, this vote of confidence has been reflected in an increase of our share prices of now of almost 10%, which makes me very happy, not necessarily for BCP, but also for the investor community that at the end of the day is benefitting from your analysis and from your value added. And we feel very strongly that we will be able to deliver on this, confirming once again our execution capability. Thank you.