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Operator: Good morning. This is the Chorus Call conference operator. Welcome, and thank you for joining the Fineco Third Quarter 2025 Results Conference Call. [Operator Instructions] At this time, I would like to turn the conference over to Mr. Alessandro Foti, CEO and General Manager of Fineco. Please go ahead, sir.
Alessandro Foti: Good morning, everyone, and thank you for joining our third quarter 2025 results conference call. In the first 9 months of 2025, net profit at EUR 480.5 million and revenues at EUR 969.6 million, supported by our nonfinancial income, investing up by 10% year-on-year, thanks to the volume effect and the higher control of the value chain by Fineco Asset Management, and brokerage is up by 16.5% year-on-year, thanks to the enlargement of our active investors. Importantly, if we zoom on our quarterly dynamics, net profit and revenues were back to the sequential quarter-on-quarter growth. Our net financial income has already bottomed out and fully absorbed the decreasing interest rates and was up around 2% versus the second quarter on the back of positive deposit net sales and positive reinvestment yield. Operating costs well under control at EUR 259.9 million, increasing by around 6% year-on-year by excluding costs related to the growth of the business. Cost income ratio was equal to 26.8%, confirming operating leverage as a key strength of the bank. Moving to our commercial results. The underlying step-up in our growth dynamics gets crystal clear month by month. This is underpinned by the positive tailwinds from structural trends, and we are leveraging on this solid momentum through a more efficient marketing. The result of this acceleration has been clearly visible in the first 9 months of 2025. First of all, we added around 145,000 new clients, up by 33% year-on-year. In October, new clients are around 19,000, the second best month on record, up more than 25% year-on-year. Second, our net sales were EUR 9.4 billion in the 9 months up by strong 36% year-on-year. In October, estimated total net sales saw a further continuation of this trend at around EUR 1.3 billion, up by more than 30% year-on-year. The mix was very positive with assets under management at around EUR 0.5 billion net sales, up by more than 20% year-on-year. Deposits at around minus EUR 0.1 billion, and assets under custody at around EUR 0.9 billion, leading to the best month ever for brokerage revenues at around EUR 31.5 million. Our capital position continued to be strong and safe with a net common equity Tier 1 ratio at 23.9%, and a leverage ratio of 5.11%. On the right-hand side of the slide, you can find the summary of our guidance. Our outlook for 2025 has improved, thanks to the acceleration of the structural growth and under it, our business model. More in detail, our net financial income bottomed earlier than expected in the second quarter, thanks to the positive deposit net sales and reinvestment yields. On investing, we are experiencing the solid year-on-year increase of our assets under management net sales currently with the lower interest rates. Brokerage revenues for 2025, we expect a record year, thanks to the continuously growing floor driven by the higher asset under custody and enlargement of our active investors. October revenues are just the latest evidence of the higher floor of the business. Banking fees are expecting a slight decrease in 2025 versus 2024 due to new regulation on instant payment. On operating costs, we expect a growth around 6% year-on-year, not including a few millions of additional costs for growth initiatives in a range between EUR 5 million and EUR 10 million, mainly for marketing and Fineco Asset Management and AI. Finally, in 2025, we expect a payout ratio in the range between 70% and 80%. On 2026, we expect all the business areas to contribute positively in terms of growth to our revenue growth. Net interest income is expected to grow year-on-year on the back of positive deposits, net sales and reinvestment yields. On investing, we expect a solid growth on our asset under management net sales. Banking fees expected to grow on the back of a higher number of clients. Brokerage revenue expected to grow, thanks to the increase of the asset under custody and active investors. On 2026 guidance, more details will be provided during the next year, Capital Market Day on March 4. Let's now move to Slide 5. Before moving into the details of the presentation, let me stress that month after month, Fineco is recording a continuous acceleration of its growth dynamics supported by a very healthy underlying quality. As you know, our business model relies on diversified and quality revenue stream, allowing the bank to deal with any market environment. On the banking revenues, our net financial income is a capital-light one with lending being only in an ancillary business, and it's driven by how our clients valuable and sticky transactional liquidity. Let me stress that deposits are joining our platform for the quality of our banking services and not due to aggressive commercial campaign on short-term rates. That's why our deposits are so valuable and our cost of funding is practically close to 0. Our investing revenues are recording and healthy and future-proof expansion as they are already aligned with clients' rising demand for transparency, efficiency and convenience. This approach is mirrored in the quality of our revenue mix, which is almost entirely recurring with a very low percentage of upfront fees and no performance fees at all. Finally, our brokerage is clearly experiencing a further step up on the floor of the business, thanks to the capability of our platform to have a structurally higher number of active investors, leading to a structurally higher stock of assets under custody. This is driven by the structural increase in client interest to be more active on the financial market, and this is building a bridge between the brokerage and investing world, which we are the only one able to scoop given our market position. Let's now move to Slide 7 and start commenting on the most recent plan. Net financial income fully absorbed the decreasing market rates, thanks to the organic growth and our valuable deposit base. This net financial income was up by 1.9% quarter-on-quarter, led by the positive deposit, net fees in the higher reinvestment yield of our bonds running off. This despite the still declining average 3-month Euribor. Let me quickly remind you the quality of our net interest income, which is capital light and driven by our clients' valuable and sticky transactional liquidity. That's why our deposits are so valuable and will be the driver going forward for the growth of our net financial income. Let's now move on to Slide 8. Investing revenues reached EUR 295.6 million in the first 9 months of 2025, increasing by a solid 10% year-on-year on the back both of growing volumes, thanks to our best-in-class market positioning and of the higher efficiency of the value chain through Fineco Asset Management. Let me remind you the great quality of our investing revenues mirroring our transparent and fair approach towards clients. Our revenues are mostly driven by recurring management fees with very low upfront and no performance fees at all. Let's move on to Slide 9. In this slide, we are representing the 2 main sources of growth for our investing business going forward. On one hand, the Fineco Asset Management is progressively increasing the control of the investing value chain, its contribution to the group net sales has been consistent over the cycle, thanks to its incredible time to market in delivering new investment solutions aligned with clients' needs. The contribution of Fineco Asset Management, assets under management after the total stock of assets under management has been steadily growing, and it's now equal to 39%. On the other hand, being a platform, Fineco is the best place to catch the latest trends in terms of client investment behaviors. There is a clear change underway in the structure of the market with clients increasingly looking for transparent, efficient and convenient solutions. All of this is channeling a strong demand towards advanced advisory services and with an explicit fee where Fineco is by far the best positioned in Italy, as you can see down in the slide. Let's now move to Slide 10 for a focus on brokerage. Brokerage registered a very strong first 9 months with EUR 187 million revenues driven by our larger active investment base and growing stock of assets under custody. October further built on this, delivering a record month with EUR 31.5 million estimated revenues. Let me stress that the revenues to our assets under custody are expected to grow as we roll out our new initiatives on stock lending, auto forex, ETFs and systematic internalizer. Average revenues in the 9 months are around 7.3% higher versus 2020 with much healthier underlying dynamics. This is driven by the structural increase in client interest to be more active on the financial markets and building a clear bridge between the brokers and investing world. The brokerage business represents the best sign of how fast the structural financial market is evolving as technology is driving a swift change in clients' behaviors, thanks to higher transparency. For this reason, we consider the brokers Italian market very underpenetrated, and we see a strong opportunity to grow despite already being the market leader. And again, October numbers are a clear sign of this opportunity. Let's now move on the Slide 12 for a focus on our capital ratio. Fineco confirmed once again capital position well above requirement on the wave of a safe balance sheet. Common equity Tier 1 ratio at 23.93%, and the leverage ratio at a very sound 5.11%, while risk-weighted assets were equal to EUR 5.81 billion, total capital ratio at 32.53%. As for the liquidity ratios, liquidity coverage ratios is over 900% and net stable funding ratio is over 400%, while the ratio, high-quality liquid assets on deposits is at 80%, well above the average of the industry. Going forward, we confirm that we will continue to generate capital structure and organically, thanks to our capital light business model. Given the strong acceleration of our growth, we are taking more time to have a clear view on deposit net sales going forward and the underlying dynamics are strongly improving. If despite the strong acceleration in our growth, there will remain excess capital, we will decide on the best way to return it back to the market. Now let's move to Slide 18. Let's now focus on our guidance. Our outlook for 2025 has improved thanks to the acceleration of the structural trends behind our business. More in details, our net financial income bottomed earlier than expected, thanks to the positive deposit net sales and reinvestment yields. On investing, we are experiencing the solid year-on-year increase of our assets under management net sales currently with lower interest rates. Brokerage revenues are expected to remain strong with a continuously growing floor, thanks to the higher asset under custody and the enlargement of our active investor base. For 2025, we expect record revenues with October number being just the latest evidence of the higher floor. Banking fees are expected with a slight decrease compared to 2024 due to the new regulation on instant payments. For 2026, we expect all the business hires to contribute positively to our revenue growth. The net interest income is expected to grow year-on-year on the back of deposits, net sales and reinvestment yields. On investing, we expected solid growth of our assets under management net sales. Banking fees are expected to grow on the back of higher clients. Brokerage revenues are expected to grow, thanks to the higher asset under custody and the enlargement of active investors. On 2026 guidance, more details will be provided during the next year Capital Market Day on March 4. On operating cost for 2025, we expect to grow at around 6% year-on-year, not including few millions of additional costs for growth initiatives in a range between EUR 5 million and EUR 10 million mainly for marketing, Fineco asset management and AI initiatives. Cost/income, we expect it comfortably below 30% in 2025, thanks to the scalability of our platform and the strong operating gearing we have. On the payout ratio, we expect that for 2025 in a range between 70% and 80%. On leverage ratio, our goal is to remain above 4.5%. Cost of risk was equal to 7 basis points, thanks to the quality of our lending portfolio. And for 2025, we expect it in the range between 5 and 10 basis points. Finally, we expect a robust and high-quality net sales and the continued strong growth expected for our client acquisition as we are in the sweet spot to keep on adding new market shares. Let now move on to Slide 19 for a deep dive on our growth opportunities. Fineco enjoy a unique market positioning to catch the long-term growth opportunity, resulting by the huge Italian households whilst in the fast-changing clients' behaviors. In the graph, you can see the strong potential of our growth given the stock of financial wealth on the Italian families. Our market share is still small, and the room to grow is huge. We are very positive on our future outlook as we have no competition on our market positioning. As a matter of fact, Fineco is the only big player with a service model truly based on transparency, efficiency and convenience. Moving now to Slide 20. The step-up of our growth trajectory is clearly materializing, as you can easily see in our recent client acquisition. On top of the slide, you can see the impressive acceleration of new clients, which is further building up in the first 9 months of 2025. This acceleration is very healthy because it's based on the quality of our offer and not on an aggressive marketing campaign with short-term rate remuneration. As a result, all our new clients are improving the metrics of the bank by bringing more deposits or more business for brokerage and investing. This value is recognized by our clients, as shown by our customer satisfaction of 94% and our Net Promoter Score way above the industry average. Let's now move to Slide 21. The cumulative growth on high-quality new clients is translating into better net sales dynamics shown by the 36% increase of our total net sales year-on-year. Let me share that the mix of our net sales mirrors our positioning as the reference partner for all clients' financial needs, with asset under management is driven by client interest for transparent, efficient and convenient investment solution. Our banking platform is attracting valuable transaction liquidity. Finally, asset under custody are clearly sign of the increasing clients' engagement on our brokerage platform, thus contributing to our revenue generation. On top of this, we see a sizable mix shift opportunity coming from the huge stock of Govies of our clients, both over the last couple of years. Let me now hand it to Paolo, our Deputy General Manager and Head of Global Business, to comment on Slide 22.
Paolo Grazia: Thank you, Alessandro. Good morning, everybody. As you know, the financial industry is quickly heading into an inflection point and it's going to be heavily reshaped by technology. Thanks to our deep internal know-how and data control, Fineco is the only real player able to take massive advantage from it and to further accelerate our growth journey. This will be reached with our usual cost effective approach. We are planning to launch an efficient and pervasive AI implementation in 2 directions. First, focusing on productivity of our network of personal financial adviser; and second, playing attention to the cost efficiency and the bank -- of the bank by reshaping the internal processes. While on the latter, we will update the market in the next month. We have already started to reengineer our financial adviser platform with the integration of an AI assistant. This is a key enabler to boost our network productivity and deliver a better quality service to clients, and ultimately improving our revenues growth via stronger net sales and assets under management. Our very first initiatives are already live and widely used by our network. Our financial planners have in their hands a powerful AI assistant, which is going to be a game changer for wealth management. In the slide, you can see the main features of the AI assistant, among which is worth underlying, one, the portfolio builder, a powerful tool to immediately create quality portfolio fed with Fineco financial logic and optimize on client goals. And the portfolio builder is also a content creator, a communication tool able to create professional and customizable reports, proposals, portfolio reviews and brochures automatically generating narratives, content to support the financial planners. It's also a powerful marketing tool, allowing for comparison of existing portfolio of prospect clients. The AI system is also a search tool, a faster info-search process for internal memo and communication. The next wave of AI implementation will focus on CRM for our financial advisers, fully integrated with client data. It will empower our financial adviser to manage their agenda more efficiently, enabling a structured approach to client engagement and cross-selling by streamlining customer management and unlocking new commercial opportunities. This will represent a further step in enhancing productivity across our network and driving for an even stronger growth. Finally, we are working to bring an AI powered search tool also to our brokerage client, our finance clients, allowing for an even easier experience to our state-of-the-art platform. I will hand it back to Alessandro to move on Slide 23.
Alessandro Foti: Thank you, Paolo. Let me now focus on our assets under custody, a component to our business that is sometimes undervalued by the market, but that is the real cornerstone of our fee-driven growth. This is true for investing as assets under custody remains the main source fueling our asset under management sales. As you know, around 90% of our growth is organically driven. As a consequence, new clients tend to show an asset allocation more skewed towards assets under custody, and the job of our financial advisers is to improve their mix into asset under management. For brokerage, the expansion of assets under custody and the growing base of active investors are key factors leading to a structurally higher floor in our revenues, which we expect to grow as we roll out our new initiatives on the stock lending, after-tax, ETFs and systematic internalizers. Finally, in the fast-growing ETF space, we are exploring new revenue opportunities, which we expand moving into Slide 24. Fineco is uniquely positioned to capture the strong client-driven shift towards more efficient investment solutions such as ETFs. The stock is quickly on the rise and now exceed EUR 15 billion. And ETFs now accounting for half of the asset under custody net sales. Thanks to our focus on transparency, efficiency and convenience, we are the only player capable of fully recognizing and monetize the structural trend with no harm on our profitability. First of all, the growing interest on ETFs is generating a positive volume effect for our investing business, thanks to our advanced advisory wrappers made of ETFs, we can move in the investing world of clients that are not interested in traditional mutual funds, thus we have no cannibalization risk on the existing fund business. At the same time, our leadership in ETFs retail flows makes us the main gateway for issues into the Italian retail market, while we currently manage all cost to handle clients without recurring fees from ETFs, talks are underway with our partners to find a fair balance. Finally, Fineco Asset Management is going to be playing a big role in the ETFs world, our Irish firm already launched its first active ETFs, and more are going to be introduced. Thank you for your time. We can now open the call to questions.
Operator: [Operator Instructions] The first question is from Marco Nicolai of Jefferies.
Marco Nicolai: First question is on the brokerage number for October. So almost EUR 32 million in a month. It's a record number. Just wanted to know if there is some -- so what's the impact from the BTP Valore issuance? And if you can comment on the underlying trend x the BTP Valore revenues? Then another question on the crypto front. I think you didn't mention it in the various projects in the presentation, you mentioned AI and other projects but not crypto. Just wanted to know if you had any updates there on the talks with Bank of Italy? One of your peers got recently the MiCA license from Cyprus in the past days. I don't know, my perception is that there could be other geographies that are quicker than Italy in granting these licenses and if that could slow down your projects here and the growth you could have in brokerage coming from the crypto side? And then another question on the payout. You mentioned 70% to 80% for 2025. I guess your leverage ratio will be well above your minimum targets for '25. And if that's the case, shall we consider 80% for 2025? Or you think there are other moving parts in the leverage ratio that could negatively affect it? So these are my questions.
Alessandro Foti: Let me start by commenting on the October brokerage numbers. The impact of the -- from the BTP Valore has been more or less in the region of EUR 5 million. So this means that in any case is remaining so excluding the contribution of the BTP Valore, the numbers are EUR 26 million revenues in the month of October, that is quite significantly above the average of the revenues generated in the previous month. And this clearly is clear, perfectly current with the underlying trends that we are commenting by some time. So there is a continuous quite significant growth of the base of clients whereas continuously adding new active investor to the platform. Second, the continuous building up of assets under custody is clearly contributing in that direction because clients are not trading -- are trading stocks and trading bonds and they are trading ETFs as well. And so we remain extremely positive on the future evolution of brokerage exactly for the reasons we commented during the presentation. So structural changes underway and a continuously growing quite significantly the important growth in terms of number of clients and the Fineco emerging as the clear winning platform here in Italy. On crypto, I leave the floor to Paolo for giving the latest update on what's going on there.
Paolo Grazia: So the crypto is still a project. We're still in talks with the regulator. We have no news for now from the last call that we had. We are very aware that we have plenty of competitors that are getting the MiCA license. Unfortunately, in Italy, there is nobody yet, I guess, that has MiCA license, but we keep on talking and explaining our view to the regulators, and we hope we will come with a solution in the next few months.
Alessandro Foti: On the payout, we clearly, what we want to make very clear that Fineco is a growth story, it's a unique growth story because the uniqueness is represented by the fact that we are combining together an incredibly pool of growth together with a quite generous payments of dividends. But we are not a dividend stock. So clearly, our goal is not to give the market the highest possible dividend. So our main goal is to keep on accelerating as much as we can in directional growth. At the same time, remaining in a very compelling story from a dividend point of view. So clearly, we will see. So now, we are at year-end, we are going to take the final decision, which is going to be the final dividend payout. But so there's that. Again, my opinion there, the most important takeaway that again, Fineco is a quite unique case in the financial industry, strong growth and at the same time, very generous deal.
Operator: The next question is from Luigi De Bellis of Equita.
Luigi De Bellis: I have 3 questions. The first one, so in the recent months, Fineco has seen an acceleration in new client growth. What has changed to drive this momentum? And if do you expect this trend to continue at the same speed in terms of client acquisition? And can you comment also on the quality profile of this newly acquired client and also the acceleration that we are seeing in the net bank transfer that you mentioned in the Slide #7, that is above plus 20%. The second question on the asset under custody so a huge amount reaching EUR 52 billion. You mentioned the revenues on assets under custody expected to grow. Can you elaborate on this and the speed of this acceleration expected? And the last question on the Germany project. So could you provide an update on the initiatives? What are the current development and expected time lines for the rollout?
Alessandro Foti: Yes. Regarding the acceleration of new clients, what is driving this growth is clearly structural tailwinds because as we explaining continuously that Fineco is the only one large established significant bank in Italy that is really offering efficiency, transparency and convenience. And this kind of demand is rapidly growing, driven by the completely different technological landscape, which I think is much easier to make comparison. It's -- everything is the information is spreading out incredibly rapidly. And then there is quite significantly accelerating process of generational passage. So Fineco is the -- so now that there is the x generation that is mostly entering into the game. And this generation is characterized by significantly different habits and behaviors by the previous generations, where again, sorry if I'm repeating myself, the request for efficiency, transparency and convenience is emerging as a clear need. And Fineco is the only one player that is fully satisfied this -- for this reason, we think that really, the strong growth is going to continue, probably is going to keep on accelerating even more going forward because all these tailwinds are going to keep on gaining strength and momentum. And the acceleration of the net bank transfer has an immediate consequence of this because -- and this also is giving to me the opportunity to answer to the other questions on the quality of new clients. The quality is remaining extremely high and robust. We are not observing any kind of dilution in the quality of clients we are taking on board. And this clearly is mainly driven by the approach by the business model of the bank. Very importantly, Fineco is not attracting clients because it's taking shortcuts. We are not putting in place aggressive short-term initiatives for taking on board new clients. So we are not, for example, overpaying clients with high rates on the projects. By the way, in this moment, we have -- there are plenty of banks that they are making continuously very, very high offer on rates. But we're not -- and so the results that the clients that are opening an account in Fineco, they are opening an account just exclusively because they are interested in using our platforms, our services. And this really is very positive for the -- in terms of quality of clients, and is incredibly positive for the evolution of the revenue generation that is going to every single additional client we are adding to the platform is to some extent, contributing in increasing the revenues of the bank. And on the speed of growth in brokerage revenues, as we are saying. So the more clients we are taking on board, the more assets under custody we are keeping on building up and the more you can expect that the floor of the business is continuously going up. We are driving on the concept of floor because we are interested in seeing -- on seeing how brokerage is performing without considering the theoretically short-term impact caused by volatility. By the way, until so far, the volatility this year has not been particularly relevant, has been a level of volatility that has been, let me say, average. So this is clear. And so yes, brokerage to remain on the fast lane growth. On the time line and what's going on, on the Germany rollout, again, I'm leaving the floor to Paolo to give a little bit more flavor.
Paolo Grazia: Yes, we have the plan. We finalized all the information we needed. And we still miss some internal approval, but we have the idea of rolling out by the end of 2026 in the friends and family mode. So this is pretty much the time horizon we have.
Operator: The next question is from Enrico Bolzoni of JPMorgan.
Enrico Bolzoni: So I have a few million brokerage given the very strong print. So you mentioned about the possibility of monetizing that you see in different ways. One of your European competitors recently announced the decision to offer securities lending on AUC, and they were quite specific so they disclosed that they think they'd be able to generate about 20 basis point margin on the AUC that are eligible for securities lending. So I wanted to ask you, first of all, where do you stand in that process? I think it's something in the past you mentioned you wanted to pursue yourself? Second question, what proportion of your AUC is eligible? And thirdly, if you can confirm that 20 basis point might be reasonable number to expect in terms of revenue that you could generate out of that? So that's my first question. And then my second question, I was looking at your AUM flows. So in the quarter, you had over EUR 900 million. You also disclosed that a good chunk of that, so roughly EUR 600 million came from Advanced Advisory Solutions, which is positive. But could you please disclose what was the margin on average on this EUR 600 million of AUM that actually related to what you see after. That would be helpful for us to understand whether indeed there is no margin dilution from these type of contracts.
Alessandro Foti: Okay. Thank you. So regarding on the -- let me start by brokerage. Possibility to monetize assets under custody, yes, as we explained during the presentation. The way we have quite a very interesting additional evolution there in terms of increasing the margins generated by assets under custody. Let me remind, one is, for sure, represented by the stock lending. The bank is in the process of deploying a much an extremely structured platform for taking advantage by the stock lending and some. On the margins, clearly, 20 basis points we think that overall is a conservative number. So it probably can be even more. And on the proportion of assets under custody eligible, this is a moving picture because exactly one of the rationale behind the platform is going to expand as much as we can the eligible amount of assets under custody we have, and so particularly. Another clear direction is the -- as we were mentioning, is represented by the AutoFX and some of them, I will leave to Paolo and some -- if you want to make some technical comments on the AutoFX.
Paolo Grazia: Yes. We have a growing number of orders that are going to the American, the United States market, NASDAQ and NYSE. So there is a lot of flows going there. And of course, there is big revenues attached because our clients, they have euros on their accounts and they trade on the USD. So the AutoFX is a new service that allows the client to be much more -- it's a faster mode of executing an order. So the exchange is made automatically by the platform. So this is something that is giving us a simpler order for the clients. So it's easier for the client to place the order. And for us, there is a slightly higher margin compared to the fact that before the client had to change every time the FX, the AutoFX is better for the client, but also better for us.
Alessandro Foti: Then we have exactly, what we are continuously now -- is the other announcement in terms of revenues represented by ETFs. So what's going on there? We think -- we confirm that by year-end, we are going to finalize the first arrangement that you get by the ETFs were the recurring fees. Overall, at the European level, the industry is moving exactly in that direction. So the largest issues are progressively moving in the direction to close arrangements with the largest European players in terms of control of retail flows on ETFs, and Fineco is going to be one of them. And so this clearly, again, is confirming the importance to play big, to be really the reference platform there. On the asset under management flows. So on the margin, so we are not making any specific distinction. So for us, the margins, on the -- so for us, it's indifferent if the clients are putting in the advisory platforms, actively managed funds, ETFs, assets under custody because what the clients paying is an advisory fee that is totally different. It's totally not correlated with -- is independent by the -- what is put in the portfolio. So theoretically, the clients can ask of having a portfolio that is made exclusive by asset under custody. And for us, the margins are going to be exactly the same if the client is putting -- is having a portfolio represented 100% by actively managed parts. So this exactly is something that is the great advantage that Fineco has. Fineco is extremely advanced in making clients paying an advisory fee. And so being completely detached by the inducement based model. And so again, this is going to be another big trend that is emerging.
Enrico Bolzoni: If I maybe, just a very quick follow-up. It's very helpful when you commented the 20 bps is perhaps low. I think that the idea behind that 20 bps is that a portion of the revenues will be shared with clients. So the underlying return could be actually higher than 20 bps. Is this what you are also thinking of? So 20 bps, could it be a number that you internalize so net what you pay to clients from securities lending? Or you think it could be generally an even bigger number?
Alessandro Foti: So it's clear that when we are showing the margins, we are considering that we have to pay the clients because this is clearly by law. And so clearly, there is a gain so we can confirm that we think that also including what we have to pay to clients, probably this 20 basis point margin is on the conservative side.
Operator: The next question is from Hugo Cruz of KBW.
Hugo Moniz Marques Da Cruz: I just had a question around your comment on brokerage revenues and how that converts into P&L, particularly trading profit because when I look at consensus, it is trading flat, flattish going forward. So that doesn't seem to make sense to me in light of your comments that brokerage revenue should continue to go up. So if you could give a bit more color on how the brokerage revenues and trading profit, how we convert into trading profit?
Alessandro Foti: First of all, let me remind you that for us, trading profit is not something that is driven by the bank taking some kind of risk, it's a kind of free of risk market making. So we are -- when we were mentioning among the components that they are -- we expect are going to keep on contributing in making the brokerage revenues growing, also the systematic internalization of orders of clients. And so we expect that the more we are going to keep on building up the volumes and business, and as well, we expect also the opportunity offered by the systematic internalizing -- internalization of orders is going to keep on growing as well. We are not surprised by the fact that the market tends to be a little bit always in a step behind what's going on in brokerage because as we said during the presentation, probably everything that is in the region of assets under custody and brokerage, brokerage has been probably a little bit the most misunderstood component of our business because clearly, as we are seeing assets, typically until the recent past, big growth in asset under custody has been not very well welcomed by the market. But the asset under custody clearly is the fuel for brokerage going forward and for the asset under management as well. So we think that brokerage is by definition on the fast lane of growth in the future exactly for a combination of structural reason, big growth of clients and a significant shift in the client's views and the increasing level of participation of clients, and the growing interest by clients for solutions like represented by ETFs, what is important to remind that when we're talking about brokerage, clients are trading on everything on the platforms. They're trading on stocks, they're trading on ETFs, but their trading on bonds as well. And so this is the reason why the brokerage is going to keep on doing very well.
Operator: The next question is from Christiane Holstein of Bank of America.
Christiane Holstein: My first one is on the CMD next year. So I know you flagged that you'll be announcing 2026 guidance. But just because there has been a CMD before, I was just wondering what else we can expect? Are you looking to also give a multiyear target, for example? Secondly, you previously highlighted the introduction of private markets in September. I didn't hear any update on this. So I was wondering if you could better say how that's been going and then how the interest has been from clients so far? And then thirdly, on investing management fee margin. So this has seemed to be relatively stable more recently. I know you also flagged the benefits from ETP on investing and obviously, FAM is higher margin. So as the uptake here improves, we should hopefully expect the margin to strengthen. But I was just wondering what your expectations are here.
Alessandro Foti: So on the -- what you can expect by the Capital Market Day on the next March 2026. From Capital Markets Day, we are going to give a much further and much more important and relevant details regarding what you can expect in terms of our strategy, evolution, also the rationale behind the entering more in depth, also in the initiatives, what we are going, what we can expect we are going to deliver to the market. And yes, finally we are going to give to the market that something that is going to help you in better modeling on the longer term, the projections of the bank. Yes. We think that this is the right moment because as we are saying, the bank is technically entering in a significantly different -- it's moving throughout in a relevant inflection point because this is exactly what's going on in the market. And so we think that we -- is the right moment to share with the market more details regarding the extremely exciting future that we see ahead for this bank. Private market, this is going to be -- the placement is going to start within the next few days. So probably let me say, by the next week, the product is going to be launched and is going to be up and running, and we will see. We confirm that we remain quite positive because there is an evident demand by clients. And so yes, in the next few days, this is going to be deployed. And commenting on investment management fee markets. As you know, we don't like to drive the market on the fee margins because clearly, for us, what is important is the direct -- is the evolution of revenues because revenues is a combination of volumes and margins. And these are much more important because this tends to clearly to -- tends to better represent the evolution of the market. It's a matter of fact that Fineco is by definition in a much better position than the industry in order also of having more stable margins because we are definitely less under pressure. But for 2 main reasons. The first one that Fineco is historically positioned on the lower side in terms of commissions we are charging to clients. And so by definition, this is making us less exposed to the building up pressure on margins. Second, that the journey in terms of increasing penetration of the asset under -- Fineco Asset Management solution is still underway. And this is different by other participants of the industry that now has been where the percentage represented by the whole internal products has been -- everything has been almost done. And this, in any case, with Fineco remaining and the only one large and truly open platform because this continuously growing percentage of Fineco Asset Management products is not driven by the fact that we are expected to close down the platform. The platform is going to remain an open platform. It's driven by the fact that Fineco is incredibly great in delivering continuously extremely innovative solutions and incredibly fast on bringing this to the market and so being able to remain always a step ahead of the market.
Operator: The next question is from Gian Luca Ferrari of Mediobanca.
Gian Ferrari: Three for me, please. First, on the AI project that Paolo described, can you share with us some KPIs of the business case here? So how much you invested in this project? And if you calculate any IRR you expect from the project itself. Second question is on the EUR 22 billion bonds. How much is expiring in 2026? And if you can remind us what is the conversion rate you expect to have on those bonds? The final one is on your lending and particularly on the fact that the stock has remained flat at EUR 5.1 billion in the context of declining interest rates. So I was wondering if your clients have any appetite for a bit of re-leverage considering your very strong capital ratios and lower interest rates.
Alessandro Foti: So on the AI project. So first of all, let me make few comments there. So Fineco, is in a great position in order to leverage on AI because thanks to the kind of bank we are, that Fineco is a tech company. So with AI, what is the most important element is not exactly how much you spend. But how much you are able to transform what you are investing in something that makes sense. So in the AI project, what is really -- so because everybody theoretically, there is no -- it's a commodity, the AI agents are commodities. And so the real difference is made by your capability of leveraging on high-quality, easily accessible base of data because if you don't have that, artificial intelligence is not going to work. And second, you had to be in the position to train your system, your products and so on. And again, you were back again to the point. So Fineco is -- being a tech company because Fineco is not just using technology, but is in control of the most part of the technology we are using. So this means that, for example, our data warehousing system has been by many years, a key strength of the bank. So for us, it's extremely easy to extract high-quality, easily accessible data. This make what you need in terms of investments much less than is presently requested by someone that sit on a much more complex infrastructure. So for example, if you are mostly leveraging on outsourced platforms or you sit on different layers of software, and so clearly, this is going to be to extract easily accessible and high-quality data is going to be really very difficult and incredibly expensive. The same way for the training the programs. So the more you are in control of your processes, the more you are in control of your platforms, and the easier it's going to be to go throughout the training process. You don't need to have, for example, external system integrator, taking care of you for training the process. And so this means that again, I think this is going to be much better in terms of results and much, much less expensive. And so honestly speaking, so our AI projects are what we expect to invest considering what to expect to get for this project. Honestly speaking, this is a completely meaningless point because we expect quite an important increase in the productivity of network. We expect a significant improvement in the process of the bank. But on top of that, what we expect to spend is going to be really fraction of the positive impact caused by the...
Gian Ferrari: And on the increased productivity, any quantitative indication?
Alessandro Foti: I think that -- so let me say. So also assuming, let me say, staying on the conservative side, and assuming, I don't know, a 10% increase in the productivity, this is going to be a huge number. So -- but Paolo can give you a little bit more color on this point.
Paolo Grazia: Yes. On the KPI, we are really on unchartered waters because it's -- there is no -- there are some studies in the U.S. that they are saying that the productivity of the financial tech can improve up to 20%. And I think it's something that can be reasonable in my opinion. But again, still we are in unchartered waters. So we -- for now, we're just focused on deploying the service, on improving the service, on hiring the people inside the bank that are part of the AI team that is growing. And as usual, we focus and we put effort on having our own resources, our own people that develop the technology. And I think we're doing a great job, and we are very happy with the fact that we are very fast in developing new tools and delivering to the -- for now to the financial planner, to our financial planner platform.
Alessandro Foti: On the expiring bonds, next year, EUR 4.2 billion in terms of reinvestment. So what we can expect in terms of transformation, for example, in asset under management solution. This clearly depends on the market conditions. So as much as we stay in an environment with short-term rates, low and the yield curve keeping or remaining positively shaped, if not even steeper. And this clearly is going to be -- is going to bode well for a continuously increasing transformation rate. But again, it's difficult to give you a precise number right now because -- but what we can say that the conversion rate is mostly driven by the combination of short-term rates staying low and the yield curve remaining. And the steeper it is, the yield curve and the better it is for the transformation process. On lending, yes, the stock is flat, but we are observing some interesting transformation because, again, we confirm that we don't have any particular appetite for the residential mortgage business that we consider by far the lowest profitable product that a bank can have on the shelf. For these reasons, we don't have any appetite for residential. We are providing residential mortgages just to our interesting clients. And so we expect that the overall stock on there is going to keep on declining. At the same time, there is a quite significant growing interest by clients for the Lombard loans. And Lombard loans are expected to keep on building up. We have in the pipeline a very interesting future developments there that we think are going to keep on making quite even more interested in using our Lombard loan solutions.
Operator: The next question is from Ian White of Autonomous Research.
Ian White: Just a few from my side as well, please. Firstly, just going back to the net management fee margin. It is about flat year-over-year by my calculations at 69 bps. Can you just help us understand the moving parts there? I'm looking at the details. The insurance products have declined, equity markets are higher, FAM penetration is higher. So are you able just to complete that bridge for me, why aren't we seeing more margin accretion there year-over-year, please? That's question one. Secondly, on Slide 23, you mentioned that the adviser network is focused on improving client mix from AUC into AUM. Can you just talk us through a little bit of what those efforts actually look like in practice. I'm wondering if it mostly requires convincing your clients to switch from being an execution-only customer to an advised customer? And also if you can share any figures there to help us better understand the flow of client assets from AUC into AUM, please? And that's question two. And just lastly, you mentioned in your prepared remarks the systematic internalizer as a forward-looking driver of growth in brokerage. Can I just clarify, is something likely to change there in the coming months that would increase revenue capture? Are there certain products where you might begin internalizing that you're not currently, for example? And that's my third question.
Alessandro Foti: Let me start by the net fee margins. So the net fee margins remained relatively stable. And so exactly for the reasons we were describing. So the bank is definitely in a more comfortable position with respect to the industry because it's been always characterized by not overcharging clients with very high commissions. And so by definition, we are definitely less vulnerable than the industry on the building up pressure on margins. And second, the driver are mostly -- so yes, insurance is lower. So because -- and the equity markets are not growing particularly big. So still, we are not seeing any significant growth in terms of appetite by clients for the equity market. And for sure, Fineco Asset Management is continuously growing and is contributing on the margins because we had a better control of the value chain. And this despite the mix of the products, both by the client is remaining on the cautious side, mostly represented by fixed income solutions, in any cases, the better control on the exchange contributing. But again, we are not particularly -- for us, the main focus is on the evolution of the revenues because it's clear that overall, we are living in an environment so the huge difference between the, for example, the brokerage world and the investing world that, generally speaking, the investing world as an industry is, by definition, is expected to keep on facing pressure on margins. This is not the key, for example, for the brokerage business. So that's where the pressure on margin is going to be much, much lower. On the other hand, the more you are becoming sophisticated in managing the flows, the infrastructures and the more you are going to have room for increasing your margins, and this is exactly the key when we're talking about the systematic internalizer. Yes, Europe is progressively moving more and more in the direction of being more similar to the U.S. market where a growing component, large component of the profitability is represented by the management of flows. And this is exactly what's going on in Europe as well. So Europe has been lagging behind in a big way, but now, the situation is changing. The example is Germany. Germany is a market in which the percentage represented by the management of flows is quite high there. And yes, clearly, this business is a volume business. The more you are keeping on growing in terms of sites, the more you're keeping on hedging assets on the platform, the more you are going to have high-quality clients using the platform. And the more -- let me say, instead of using systematic internalizing, the management of flows is going to become an important driver in increasing the margins on the brokerage business. And as we are saying, we have plenty of initiatives on the pipeline that's exactly moving in that direction and that are going to deploy in the coming months. And internalizing something that's now you don't -- no, internalizing more that we are doing now that -- because really, we are practically internalizing everything. So ranging from stocks, ETFs. ETFs is emerging as a growing and important component of the -- internally in terms of internalization of flows and so on. So the direction is not internalizing, it's something that now we don't know, but internalizing more and more because clearly, this is -- because we are going to become more sophisticated, the growth on the volumes are going to help, yes, this is a big trend.
Operator: The next question is from Alberto Villa of Intermonte SIM.
Alberto Villa: Two very quick questions from my side. One is back on the new client acquisition, impressive trend there. I was wondering, how much they are contributing to the net sales in the first 9 months of 2025, let's say, the new clients you get -- you got in the last 12 months? And I was wondering what the average assets you get from a new client after 12 months, if that is already comparable to the average customer you have in-house or there is any, let's say, timing from the acquisition of the client to getting this -- moving the asset to Fineco? And the second question is on the advisory -- advanced advisory stock that has grown now to above EUR 37 billion. I understood that you have the same margin, whatever is the underlying assets the client has. I was wondering what has been the contribution in terms of revenues in the first 9 months of the year from the advanced advisory assets.
Alessandro Foti: So in terms of what is the contribution of the new client acquisition, more or less, we can say that in terms of new total financial assets, 65% is brought by the new clients. So the 65% is driven by the new client acquisition, and the remaining part is the continuously growing share of wallet on the existing clients. Yes, this is more or less is the split. And after 12 months, so clearly, we have to make a distinction because there is a kind of polarization in the clients we're acquiring because one is that we have the relatively young clients, they're going big. And the other company that is growing big is represented by the rich clients or other banking clients. These are the 2 segments in which we are growing the most because this, by definition, are the 2 segments that are the most sensible to the concept of getting delivered efficiency, transparency and convenience. And typically, so we -- so yes, after 12 months, we can say that a large part of the -- on the assets of the clients have transferred into the bank. But still, we have a significant room for growing on our existing base of clients because we are making estimates on -- in order to understand which is the potential represented by clients that are theoretically perceived as more clients on the platform and then putting together the significant amount of information we have because having all clients using the transaction banking platforms, we know everything of the clients. So where they're living, how much they're making in terms of salary, the amount of taxes they are paying, where they are spending, how much they're spending. And so at the moment, our so-called still small clients that has an upside of the bank and average potential of another EUR 50 billion, more or less. I'm not saying that we're going to get all of that. But clearly, the more the trends, the new trends are building up in terms of strength and the more also we're going to be able to get even more share of wallet by our clients. The advanced advisory stock, no, we are not giving the split of these revenues.
Operator: The next question is from Elena Perini of Intesa Sanpaolo.
Elena Perini: I've got only one last question. It is to ask you if you have already made some calculations about the potential impact of the Italian Budget Law for next year?
Alessandro Foti: Not yet because everything is still so unclear that it's probably, yes, we are making some time, some simulation, taking -- considering the rumors that are on the market. But honestly speaking, it's a little bit -- I think that the risk is to -- is a waste of time because everything is still underway. But honestly speaking, we are completely not concerned by this because this is not -- for us, what is important is the structural trajectory of the bank. So this can be, okay, fine. It's part of the game, but it's not going to change anything. So we are not, honestly speaking, particularly neither concerned nor particularly interested in what's going on there.
Operator: [Operator Instructions] Mr. Foti, there are no more questions registered at this time.
Alessandro Foti: Thank you to everybody for the extremely interesting questions we got. As usual, we are absolutely at your disposal for entering in additional follow-up. And so thank you again for taking the time to participate to our financial results conference call.
Operator: Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones. Thank you.