Woori Financial Group Inc (WF) 2021 Q2 法說會逐字稿

Good afternoon. I am [Lee Dong Su], Head of the IR Department at Woori Financial Group. Let me extend my deepest gratitude to everyone who is participating in this earnings call today.

On today's conference call, we have the CFO, Mr. Lee Sung-wook; and also the CRO, Mr. Jung Seok-Young; and CTO, Mr. Hwang Weon Cheol. Because of COVID-19, please understand we have tried to keep the attendees to a minimum.

Today, we will start with a presentation on our performance, after which we will have a Q&A session. In addition, we have simultaneous interpretation for our overseas investors ongoing. Let us start the first half 2021 presentation on Woori Financial Group.

Good afternoon. I am Lee Sung-wook, CFO and Head of the Financial division at Woori Financial Group. First, let me thank everyone who is participating on this call for the first half of 2021 for Woori Financial Group. In addition, I would like to take this opportunity to express my gratitude for our shareholders and other market participants for your trust and support in our company. Woori Financial Group, in order to strengthen communication with shareholders and investors in Korea and abroad, will be conducting earnings conference calls from this quarter going forward.

With that, let me walk you through the first half 2021 performance for the group. Please refer to Page 3 of the presentation materials, which are available on our website. First, let me go over the net income.

The first half 2021 net income for the group was KRW 1.420 trillion. Amid local and global uncertainties due to a prolonged COVID-19 situation, the group was able to exceed last year's full year performance in only 6 months. The first half performance was up by 114.9% year-over-year due to stronger profit generation capabilities after the holding company transition and stable asset soundness and active cost saving efforts for the group.

For the second quarter 2021, the net income was KRW 753 billion. On a per quarter basis, the first quarter represented the highest performance to date. However, this quarter was a 12.9% Q-o-Q increase, once again setting a new quarterly high.

Next is net operating revenue. The group's first half net operating revenue was KRW 4.044 trillion, up 18.6% year-over-year. Net interest income was KRW 3.323 trillion, and noninterest income was KRW 721 billion. For interest income, the main subsidiary of the group Woori Bank's solid loan and core deposit growth continues to drive momentum and improvements in the profit structure.

In addition, on the noninterest income side, increasing synergy between subsidiaries after the holding company transition has taken profit generation capabilities to the next level. In terms of quarterly net operating profit for the first time since establishing the holding company, it has exceeded KRW 2 trillion to post KRW 2.057 trillion, which is 3.5% higher Q-o-Q and 26% higher Y-o-Y.

Next, let me walk you through the cost side, such as SG&A and credit cost. For the first half, our group SG&A, it totaled KRW 1.856 trillion, an increase of 3.7% Y-o-Y. The main drivers are the newly included capital company and savings bank. When excluding these companies, the increase Y-o-Y was only around 0.9%. As a result of group-wide saving -- cost saving efforts, the group's cost income ratio for the first half was 45.9%, an improvement of 6.6 percent points Y-o-Y.

The first half group credit cost was KRW 205 billion, and the credit cost ratio was 0.13%, lower 0.2 percent points Y-o-Y. A recovery in the shipbuilding and shipping industries led to some reversals and provisions, but even if this one-off event is excluded, the normal credit cost ratio was 0.17%, showing that the group's key asset indicators are also at the best level in our history.

Next, let me go over the group's business in detail by area. Please turn to Page 4 of the presentation. First, I will walk you through the interest income and the NIM. The first half group net interest income totaled KRW 3.323 trillion, up by KRW 382 billion or 13% Y-o-Y. The second quarter bank-only NIM was 1.37%, an increase of 0.02 percent points Q-o-Q, and the group NIM including the credit card business was 1.61%, an improvement of 0.01% percent points Q-o-Q.

Even though the market rates, which rose quickly in the second quarter, has somewhat slowed, core deposits increased 10.6% versus the end of 2020, and loan repricing has enhanced lending rates, which led to an improvement in NIM of 0.02% percent points Q-o-Q, so NIM continues to improve.

In addition, next let me touch upon asset growth in our loan portfolio. Bank assets as of June totaled KRW 276 trillion, up by approximately KRW 11 trillion or 4.4% versus the end of last year. Household loans stood at KRW 133 trillion, an increase of 2.1% versus the end of last year, and corporate loans grew 6.9% to reach KRW 141 trillion, mainly driven by SME loans during the same period.

In the second half, to concentrate on capital adequacy and asset soundness, the bank is planning to control its asset growth. In the first half, even though loans grew more than 4% and COVID-19 financial support was extended, Woori Bank's percentage of finance assets was 88.5% as of June end. Since the end of March 2019, the bank has been able to consistently maintain a level above our target of 85%, showing that our soundness is being maintained at a very stable level.

Next is on the group's noninterest income. In the first half, the group's noninterest income stood at KRW 721 billion, which significantly grew by 54.1% year-on-year. Particularly, fee income, which is the core of noninterest income, posted a quarterly record high at Q1 ever since the establishment of the holding company, and this was followed by a performance of a mid to upper KRW 300 billion range in the second quarter.

Amid improving sales performance of the banking card business, the newly acquired capital business and the subsidiary synergy started to kick in, in earnest. Meanwhile, the group's second quarter noninterest income stands at KRW 354 billion, which is a 3.5% decrease Q-o-Q. However, when we exclude the one-off factors of Q1 amounting to KRW 50 billion, including profits from the sale of foreign currency bonds, the upward trend for noninterest income continues.

Next is on expenses and capital adequacy. Please refer to Page 5. As aforementioned, the group's SG&A expense stood at KRW 1.856 trillion, which is a KRW 66 billion increase year-on-year. However, when excluding the impact coming from new acquisitions including the capital and savings bank business, the increase was limited to approximately 0.9% Y-o-Y.

Currently, Woori Financial Group in order to stably manage the cost to income ratio, executing intensive efforts across all subsidiaries to cut SG&A expenses. While we will be engaging in bold investments in digital and IT for sustainable growth, the group's target for this year is to bring the CI ratio down by 5% compared to last year to approximately 50% levels.

Moving on to credit cost. Group credit cost in the first half was KRW 205 billion compared to the same period of the previous year when large-scale preemptive positioning was executed. Reflecting future economic outlook, credit cost decreased 54.1% Y-o-Y. Credit cost ratio decreased 0.20 percentage point year-on-year, improving significantly to 0.13%.

As mentioned earlier, due to earnings improvement in certain sectors in the second quarter, there was a reversal factor. However, even if we exclude this one-off reversal factor, credit cost ratio stands at 0.17% and is being managed at very stable levels. As of the end of June, our NPL ratio and delinquency ratio were 0.37% and 0.26%, respectively, and the NPL coverage ratio was 163.0%, which is continuously improving compared to the end of the previous year.

Recently, global credit rating agency, S&P, on June 16, upgraded Woori Bank's long-term credit rating from A to A+. This is considered as an external recognition of the fact that the group's asset quality is being managed in a stable fashion despite the prolonged impact of COVID-19.

Next, let me elaborate on capital adequacy and dividend policy. As of the end of June, the group's expected CET1 ratio posted 10.2%. Currently, the company is implementing the internal ratings-based approach only in certain areas such as individual in retail. And once the internal ratings method receives its final approval, the group's capital ratio is expected to further improve by more than 1%.

Considering the financial authorities' announcement of the lifting of the dividend restriction in June, business performance exceeding market expectations and past dividend payout ratio, the company confirmed and disclosed the dividend record date for the interim dividend on July 2. As the Board of Directors meeting that decides on the dividend is yet to be held, we cannot disclose the exact dividend amount at this time, but we will disclose the information as soon as it is decided.

As mentioned in the General Shareholders' Meeting and the disclosures of business reports, the company is reviewing various shareholder return policies within the scope of maintaining capital adequacy and plans to raise the dividend payout ratio to 30% in the mid- to long term. Furthermore, the Bank of Korea recently mentioned the possibility of raising the base rate within the year.

Let me elaborate on the impact of the base rate hike on our profitability and soundness. Please refer to Page 6.

As of the end of June, Woori Bank's loan assets within the group accounts for approximately 79.7%, of which the variable interest rate proportion is 72.4%. Among the floating rate loans, the COFIX-linked loans, which are the standard for mortgage loans, accounted for 25%, and the proportion of loans linked to 3 months of CD and KORIBOR rates, which are highly correlated with the base rate, is approximately 34%.

Taking into account that Woori Bank's portfolio has a high correlation with the duration of the base rate, we expect our interest income to increase rapidly when the base rate is raised in the future. Interest income is expected to increase. And if the base rate is raised by 25 bp, we expect interest income to increase by approximately KRW 175 billion for 1 year after the raise.

On the other hand, at this point in time, with the rapid rise of market interest rates and as we see a possible base rate hike, there are concerns about the possibility of insolvency of some marginal companies. The company has continuously rebalanced its asset portfolio that has been concentrated in a specific industry and companies in the past and thus, minimize the concentration risk. The proportion of loans to large corporations has been reduced from 20.8% at the end of 2015 to 13.3% as of the end of June 2021.

In addition, the proportion of loans to cyclical sectors was reduced from 22.3% at the end of 2015 to 10.3% as of the end of June 2021. These achievements have led to the above-mentioned upgrade in S&P's credit rating, and any asset deterioration due to interest rate hike is expected to be very limited.

This concludes the presentation of Woori Financial Group's earnings for the first half of the year.

(Operator Instructions) So the first question will be from Hyundai Motor Securities, Mr. Kim Jin-Sang.

In terms of your capital policy, I would like to ask a few questions. So I do believe that the CFO has touched upon the basic direction. However, in terms of the IRB and the impact of that, you did say that there would be an uplift of around 1 percent point. However, in terms of introduction, where do you think this could actually be introduced? It might not be introduced, but meaning 100% application, when do you think will actually take place?

And in addition to that, in terms of your capital policy, that will give you more room to maneuver. So this time around, you did say that you would be paying out interim dividends. Is this something that will be regular? And would it be possible to -- you actually expand that to provide quarterly dividends? Is there a possibility of that taking place?

In addition in terms of your shareholder return policy for your growth and also shareholder return aspects, could you maybe divide about what your policy would be going forward in each area and what your stance would be in those areas?

Yes. This is the CFO, and maybe I can answer your questions. I do believe that you have asked a long range of questions about our capital policy. In terms of IRB application, right now are looking for the authorities' approval.

Realistically, we are currently looking at a September-ish time line, and that is the expectation. So as of the end of September, we do believe that at that time, our overall capital will be able to increase by around 1 percent point.

In terms of the interim dividends, this is something that we did have a limit for dividend around 20%. And that is why this year around, we are able to pay out interim dividends, whether this will be something that we will do on a regular basis is something that we will have to review at the end of the year. So as of now, we will not have anything definitive that we will be able to share with you.

In addition, for the end of the year, a dividend payout ratio and also what we will be doing going forward, as we have mentioned before, the dividend payout ratio that we are looking to achieve over the longer term would be at around 30%. So this time around, we will be doing an interim dividend.

However, one thing that the authorities have proposed is that it would be that a 30% cap should be taken into consideration for the full year. So as a result of that, that will be something that we will take into consideration. And at the end of the year, we will look at a level that is higher than our previous years and within the range that government has recommended.

In terms of our M&A opportunities, even if our capital ratio has improved, we believe it will be in the lower 11% range. So versus our peers, we do believe it will be slightly lower. So in the current time for the capital ratio, any M&A opportunities that we would look at would be within the scope of that it would not have a hit on our capital ratio.

So I do believe that going forward, if there's more tangible opportunities, we would be able to discuss. But right now, our interest would be in the securities area because we do believe securities brokerage is an area that we would like to beef up. And then in other areas, we would look at opportunities that would not impact our overall capital ratio.

So for the capital policy that we have right now, 10.5%, which we do believe is a market minimum is something that we want to maintain at a minimum. And over the longer term, we want to be above 11%.

Next we have from Yuanta Securities. Mr. Tae Joon Jeong.

I'm Tae Joon Jeong from Yuanta Securities. In the first half, I can see that we are seeing solid performance. And I would like to understand what it would be like in the second half. And I would like to understand the reversal and what kind of effect that would have.

So I believe that connection was not as smooth. So I would like to ask you to repeat the question one more time. Would you like to repeat your question?

So I was able to see that the credit cost ratio was quite satisfactory, and I would like to understand that if we also look into reversal of provisions in the second half, what kind of impact would that have on the CCR?

In the first half, as I have already mentioned, we've seen an increase in KRW 750 billion in our net income and KRW 68 billion in our overall income. So we believe that in the second quarter, we will be seeing an increase by KRW 70 billion compared to the first quarter.

So in the second half, in the net interest revenue, we believe that interest income will continue on in current levels. And we believe that we have a lot of assets in the first half. Net operating revenue will continue on. And in the case of noninterest income without a major change in the financial markets, it will continue on with similar trending. And in the third quarter, there are nonordinary events that we are expecting the K bank capital increase. And we believe that by the end of September, there will be the quantity losses of approximately KRW 70 billion that is expected based on equity method.

And in the fourth quarter, we do have early retirements, and there are also expenses executed in the fourth quarter. So there may be some volatility in the expenses outlook. So if we look at the ordinary expenses overall, it will maintain the current trending. However, in the fourth quarter, if you look at profitability, compared to third quarter, there may be some volatility.

And Mr. Tae Joon Jeong, I believe that you've asked about credit costs of the first half and also on the second half. Let me -- I would like to reiterate. So we believe that we'll be seeing record high performance.

In the case of credit costs until the first half, we have 0.17%. In the second and third quarters, it will be of similar levels because with regard to COVID-19, we have deferred -- there were some deferrals that was a concern of the market. However, when we reviewed our customer loss, you can see that the collateral rates are close to 90%. And there was accumulated allowance with regard to COVID-19, which is more than KRW 200 billion of provisioning. Therefore, there aren't any concerns necessary in this area.

And next year with regard to provisioning, out of the precautionary accounts, we have Kumho Tire, which is about KRW 100 billion in allowances. And Kumho Tire recently, they are seeing improvements in their operating income. And as we see better performance there, I believe that next year, there will be some additional reversals of provisioning as possible.

For the next question, it will be from HSBC, Won Jaewoong will be asking a question.

Yes, congratulations on your performance. The one question that I would like to ask you is that recently because of the Delta variant, there are some increasing uncertainties within the market. So versus our expectations in terms of our dividend payout ratio because of the Delta variant, if it spreads further, do you think that, that would be an impact on your policy? That is the question that I would like to ask.

Well, this is the CFO. As the Delta variant does expand, there has been an overall decrease in long-term yield, and there is a lot of concern taking place within the market space. So if this continues to believe that the overall growth rate could be lower than expected and also, there could be a pushback in the overall expectations of a rate hike.

So as the -- as a result of that, if a benchmark rate hike at a later time, we do think that the improvements to our overall interest income could take place at a later place. However, as we have mentioned during our presentation in the second half, the focus would be more on our assets on this and also in terms of our capital adequacy. So we do believe that we would be well prepared for any downturn in the overall situation.

In addition, in terms of our dividend payout ratio, as mentioned before, the financial authorities, while lifting the ban had made a recommendation, which meant that for dividends, of course, they will give us discretion. However, versus 2019, they would like us to use that as a benchmark. So as a result, as mentioned before, I don't want to put words into the authorities' mouth, but we do think that we can have a stronger rate than we have had historically. So I don't think that you need to take any -- and have any concerns about that issue.

So for the next question, this will be from Hanwha Investment Securities. It will be Kim Do Ha.

I would like to ask you a question about your NIM. So if you look at the first and second question from bank to bank, I do think that there is some differences in the NIM growth that we see. So in the case of our case in the second half, what would be your forecast? And for next year, what would be your view for the overall situation?

And more specifically, right now, I think that the funding cost had actually been lower than expected, which had helped the overall NIM situation. But if you look at the recent times, I think that we see a stronger increase in the funding costs.

So if funding cost does increase and the overall lending cost does increase, I do think that there could be a NIM expansion. If that does take place and what would you give your expectations in terms of the timing? And when do you think we can see an improvement?

This is the CFO. In the case of the NIM, I think that in the first quarter was 1.3% and versus 1.37% in the second quarter. We actually had a 2 basis point increase in improvement.

So if we look into more detail, I think that for the low-cost deposits, that improved 1 basis point. And then in terms of [deposits], there was improvement of 1 basis point there also.

If we look at the market rate, there was also a decrease of around 1 basis points, which led to the overall 2 basis points improvement in total. So if we look at the NIM improvement in itself based upon the current market rate, if some rates remain steady, we do think that the NIM will be at the current level.

And to improvement, what we're currently focusing on is to increase our core deposits and also improving our overall lending, because on the household loan side, there's a lot of regulations. We do want to expand our assets and grow our assets in other areas.

So as a result of that versus the current situation, we do think that there will be an increasing improvement. However, as we had mentioned during our presentation before, if the KORIBOR rate and the CD rate, which is linked to the benchmark, it hasn't been rising and has been maintaining a very flat level. So from there, we have around 30% of our products, which are linked to that, which is larger than our peers. So if the benchmark rate were to rise, then we do believe that there will be an uplift that we would be able to enjoy in a very short period of time.

So if we look at the timing of that, it probably will be the fourth quarter, in which we will enjoy that uplift because we do expect that the benchmark rate may be raised in October or thereafter. And for this trend, once the benchmark rises, then we do think that, that will continue to have an impact for around 6 months or to a year.

Moving on, from Morgan Stanley, Mr. Seok Joon.

I was referring -- I would like to refer to the last slide. And you can see that we -- see, digital banks going into SOHO as well as mortgage loans and also online WM businesses. In the case of Woori Financial Group, out of the credit loans, I know that your non-face to face is 67%. So in this different competitive landscape, I would like to understand the strategy of Woori Financial Group and what kind of responses or actions do you have in place or planned.

So with regard to that, we have CTO, Mr. Hwang Weon Cheol in charge of the digital business to provide the answers.

I am Hwang Weon Cheol, in charge of the digital business of Woori Financial Group, the CTO. Thank you very much for your question. On the very last slide, if you look at the indicators on the digital business or digital innovation, you can see that the overall performance is continuing to improve.

Many do think about -- look into the cases of [ditech] and fintech as well as internet-only banks. And many do have a curiosity as to how the existing banks will respond to this different landscape. And with regard to our strategy, we are, in terms of how we look and how we observe the market and with regard to how we would like to respond, let me elaborate on that. As you're very well aware, recently, the financial authority has been looking into financial innovation, has been pursuing financial innovation. So not only Internet-only banks, but the fintech and ditech banks are now entering the market.

Particularly some do say that we're now seeing an unleveled playing field. And if you -- and they also say that we cannot see these cases abroad. It's quite unprecedented in terms of the financial regulation, especially in terms of open banking, MyData. And in the second half, we have the loans platform that this is a major change in the landscape, and we are seeing an active participation of these fintech companies.

So in terms of the stretch that we foresee that in the area of finance, we may be seeing a division of, let's say, manufacturing and sales. So in order to respond to the separation, we are looking into the policies of the financial authority, and we want to be very aggressive and active in responding to these financial regulations or policies in the future. And not only that, we have digital channels as well as a digital platform. And what we want to do is not engage in a defensive manner but to be active and to be more open.

So Woori Financial Group, as mentioned, we have our untapped channels. We -- in terms of market recognition and in terms of better functionality, what we did was put together a dedicated organization led by the CEO, and it's been up and running for a year. There has been some possible results. And as you can see in the slide, with regard to untapped sales performance, we're seeing an improvement there. And not only that, if you look at the performance assessment by media outlets compared to last year, we've been seeing some significant results.

In the future, Woori Financial Group, as we've launched in July, what we want to do is look into home loans or mortgage loans. So in other words, there are some traditional loan products that we're focused on the face-to-face market. However, we want to switch that to untapped. And not only that, if you look at the commercial loans, there were many face-to-face services that were offered, but we want to link that online to offer online WM services as well in the future.

Not only that, in terms of technical innovation, there may be a new market opening up. And to respond to that, we are looking into some emerging technologies, and we're building ourselves up internally as well to respond.

We will take the next question which will be coming from Korea Investment & Trust.

My name is Baek Doosan from Korea Investment & Trust. I would like to ask some questions about asset quality. So if you look at the bank on the precautionary side, there was some increase in that around KRW 250 billion on a Q-o-Q basis. So what was the reason for that? And was it in terms of the credit cost or in terms of your provisioning? What type of impact did that have?

So about this, on a Q-o-Q basis for the increase and the questions that you have just asked, maybe I could just take a first shot about your question, and then maybe the CFO could add on some comments as necessary.

So if we look at the normal and those that have moved into cautionary bucket, there are not a lot of assets that have done that. However, there have actually been the worth of standard or below and then have moved into the precautionary. So there was an improvement. And then like for shipbuilding, there were also some very large clients that have fit into that.

So as a result of that, on a Q-o-Q basis, there has been an increase. However, in terms of the asset quality trends, from a macro perspective, there's not a lot of change that has taken place.

Maybe if I could add some comments for the precautionary loans, the reason why there was an increase, as Mr. Lee has just mentioned, there's not a sudden change, but it's more that if we look at the asset classification, if there's one -- anything that has been more than 1 month past due, we have moved some of that. And in addition to that, on the provisioning side, there's not a lot of difference. So maybe around KRW 100 billion to KRW 200 billion, there has been some small changes there, but nothing significantly has deteriorated driving the overall increase.

From Kiwoom Securities, so we have Mr. Seo Young-Soo on the line.

I'm Seo Young-Soo from Kiwoom Securities. So since you did mention about the digital business, I would like to ask a question. From October, the FSC will be launching a loans platform. And I know that many platforms will be linking that -- linking their business to that, and this will enable the clients to compare the loans products. And so this is a restructuring loan platform.

So I believe that if that is the case, this may lead to a rate-related competition. And not only that, we were seeing an upswing in the margins. However, I believe that it may lead to a downfall. And if you do engage in these restructuring loan platforms, I think that the only thing remaining would be a competition for the rates -- on the rates. And that would mean that maybe the bank will just be a production outlet. In other words, it would be in the form, which would be a laggard in this digital innovation era. So in other words, it would be at a disadvantage.

So I would like to understand there may be some concerns here. So for Woori Financial Group, I would like to understand how you are going to respond. So for instance, when will you be launching a product? And with regard to fees and commissions, how are you going to respond?

And you said that you will be very active and aggressive in the digital business. So then I would like to understand to what extent will you be aggressive. And how will you be defending the market? I think it's a sensitive issue, but also an important issue. So would you like to elaborate on this topic, please?

As you have mentioned, for the credit loans in October for the banking sector and the card -- credit card agencies probably in December, and then we'll be moving on to secured loans as far as I know.

So as you've mentioned, there will be some fierce competition that would be leading to a cut in loan rates. But if you look at the government, they currently are engaging in the household loan volume restriction. So this means that you cannot get loans from many financial institutions once you meet the cap, meaning that it will go to increase pricing rates.

And all in all, supply is quite limited, if you look at this, but demand is to continue on. So that's why we do have a certain guarantee of profitability. And when we do see account transfer policy in place, when we do see that, that did not impact us greatly. So the household or loan regulations by the government would lead to a greater demand than supply.

So realistically speaking, we believe that this policy will not have a significant impact on the business. But we have prime clients as well as active accounts, and we believe that this will be a good opportunity to attract more of these prime accounts.

So of course, there is the loan cap policy in place, and that may be a concern, but we will be customizing our marketing efforts to make sure that we can seize the opportunity. And to add, with regard to the restructuring loan platform of how this will be operated or how it would be run, the final conclusion has not been made yet, but who will be running this platform and what will be the time, the operating hours of this platform and other details may impact the market. But all of this is undecided as of yet. Therefore, the banking sector with the banking association at the center, where [KFP] at the center is currently discussing this with the financial authorities.

And if I may add another detail to this, you believe that it may lead to -- well, the restructuring loan platform will play 2 roles basically. So first is that it can be a marketplace of competition. That's one function that it can play. And second, even now, if you look at the restructuring loan business, it's in place already in the market, but it's about, well, bettering the function or enhancing the efficiency of restructuring of loans. So will it be a stronger marketplace or will it be just better functionality in the future is something that we can look into.

But if you look at the current rates right now, depending on the transactions and business, it's a combination of a number of things in addition to the base rate. So it would be a bit difficult to see an apples-to-apples comparison to the interest rates. So I believe that this platform will not be more of a marketplace, but rather will be focused on more of bettering the functionality of restructuring the loans.

So due to time, we would like to wrap up the Q&A session. And maybe we could just have some last comments from the CFO. And with that, we would like to wrap up the earnings conference call for Woori Financial Group.

Yes. Thank you very much. Despite concerns regarding the resurgence of COVID-19, we are continuing with our performance in Q2 as we did in Q1 of surpassing 2019's pre-COVID earnings. As aforementioned, this is not a performance dependent on some one-off effects or factors, but rather the result of the group's efforts to improve profitability, soundness and cost management. We expect this performance upswing to be sustainable.

And in addition, we will make every effort to return the profits to our shareholders in various ways. We will do our best to generate results that exceed the expectations of investors in all aspects. So all the executives and employees, we'll do our best. Thank you very much for your attention.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]