Good afternoon. This is the Chorus Call conference operator. Welcome, thank you for joining the FinecoBank full year 2020 results conference call. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Mr. Alessandro Foti, CEO and General Manager of FinecoBank. Please go ahead, sir.
Good afternoon, everyone, and thank you for joining our 2020 results conference call. Before we start going through the details of the presentation, let me please underline the key messages. This set of results confirms once again the soundness of our business model, able to deliver sustainable and industrial growth in every market condition, and to accelerate growth in the current complex situation. Adjusted net profit increased by 19% year-on-year, reaching EUR 325 million in the year, despite the increased contribution to systemic charges. Adjusted revenues stood at EUR 776 million in 2020, increasing by 18% year-on-year, mainly supported by brokerage and investing. Operating costs well under control and confirming operating leverage as a key strength of the bank.
With cost income ratio at 34.7%, declining by 32 percentage points year-on-year, also thanks to the extraordinary performance of brokerage. As announced, 2020 also recorded a strong acceleration in the commercial activity, with net sales hitting EUR 9.3 billion, increasing by 59% year-on-year, and with a strong contribution by Assets Under Management, reaching a new record level at EUR 4.3 billion. Thanks to the increased productivity of our network of financial advisors and to the success of the new generation of products launched by Fineco Asset Management. Let me remind you that these results have been organically generated and reached with no aggressive commercial offer, and despite the introduction of the repricing on current accounts.
Those dynamics were also confirmed in January, with net inflows extremely robust at EUR 891 million, and a solid asset mix with Assets Under Management equal to EUR 470 million. As for brokerage, estimated revenues in the month of January were around EUR 19 million, increasing by 30% year-on-year. This confirms once again that the floor of our business is now definitely higher. Let's now move on slide five, and start commenting on our 2020 results. As announced, in 2020, we reached very strong industrial results, thanks to our diversified business model. We've adjusted net profit standing at EUR 324.5 million, plus 19.2% year-on-year, despite the higher contribution of systemic charges and the complex scenario.
Adjusted revenues in the period stood at EUR 775.8 million, up 17.9% year-on-year, mainly thanks to the contribution of brokerage and investing. As we have been able to capture the acceleration of the structural trends in place. On the banking side, our initiative on the smart repricing on current account allowed us to offset the impact coming from the lower interest rate environment. Please note that in December, after the final communication by the authority, we refunded the banking fees related to the smart repricing to a cluster of clients. Let me remind you that the effect on the net profit is equal to zero, as this refund was already accounted in the previous quarters under the line provisions for risk and charges.
Excluding the contribution generated by banking fees for the smart repricing, our revenues in the fourth quarter would increase by 1.7% quarter-on-quarter. Operating costs stood at EUR 269.6 million, increasing by 4.4% year-on-year, net of marketing costs in U.K. Additional marketing costs in Italy to catch the positive momentum for growth and additional staff expenses related to the unexpected lockdown in December. The quarter distribution is characterized by the usual seasonality. We will deep dive on cost later on. Cost income decreased to 35%, despite the continuous expansion in assets and clients, thanks to our operational leverage and the scalability of our platform. Let's now move on slide six, and start to analyze more in details the dynamics of our results.
Net interest income in 2020 remained resilient at EUR 270.7 million, decreasing by 3.8% year-on-year, despite the strong worsening of the interest rate environment. Thanks to the positive contribution by more than EUR 7 million from our treasury activities, namely yielding asset strategies like unsecured lending and collateral switch and tiering into our quality lending book. Let me please highlight that the negative impact generated by the low interest rate scenario has been offset by the positive contribution coming from the introduction of the smart repricing in 2020, which produced almost EUR 12 million of banking fees in the year. Overall banking revenues remained flat year on year.
In the fourth quarter, net interest income stood at EUR 63.9 million, declining by 7% quarter-on-quarter as the lower interest rate environment affected both financial investments and lending. Please note that in the fourth quarter, there has been a further deterioration in rates. As an example, five years Euriboir moved from 39 basis points in the third quarter 2020 to minus 46 basis points in fourth quarter 2020. Euribor month from - 52 basis points to - 55 basis points in the quarter. The lower interest rates environment led to a reduction in average gross margins on interest earning assets from 0.98% in the third quarter to 0.88% in the fourth quarter.
Cost of funding decreased by 3 basis points year-on-year to 1 basis point due to the lower USD LIBOR. Please let me remind you that our cost of funding related to deposits in Euro, which represents 96% of our total deposit, is zero. Later in the presentation, we will deep dive on the new commercial initiatives we are undertaking to sustain our banking revenues and further react to the decrease in interest rates. Let's now move on slide seven to deep dive on our non-interest income. Fees and commissions stood at EUR 404.3 million in 2020, growing by 24.3% year-on-year, thanks to the positive contribution of all products areas.
Please let me note that the net commissions in the fourth quarter would increase by 8% quarter-on-quarter, excluding the contribution generated by the banking fees on the smart repricing. Trading income, net of non-recurring items, reached EUR 97.2 million in 2020, more than doubling year-on-year, thanks to the strong brokerage performance. We will deep dive more in depth in the following slides. Let's jump now on slide 26 for a focus on brokerage. Brokerage acted once again as the perfect counter-cyclical business, it is producing structurally higher revenues compared to the past. In 2020, overall brokerage revenues stood at EUR 229 million, increasing by 73% year-on-year. On the top of the slide, you can find our usual chart showing the monthly brokerage revenue since our listing.
As you can see, they are structurally higher since 2020. January 2021 has been another strong month, confirming that the flow of the business has increased. This is true regardless of the level of volatility, thanks to the contribution of three structural components. First, the deep reshape of our brokerage business. Let me remind you that we have recently launched a new U.S. option platform, and that we are in the process of vertically integrating certificates, becoming issuer, market maker, and distributor throughout our platform. We will deep dive later on this project. Second, the client base using our platform is widening with active investors that have grown significantly in absolute terms in 2020, standing well above the average level of 2018 and 2019.
Please note that our active investors have an average of four executed orders per month, are wealthy people in their 50s with assets above EUR 200,000 on average, and the vast majority of them has a relationship with our financial advisors for the long-term planning of their financial wealth. Third, the increase in our market share. For example, our market share in Italy on equity traded volumes has increased to 27.8% in December 2020, as recently confirmed by ASSOSIM. As announced, brokerage revenues were strong also in January, reaching around EUR 19 million. Please let me note that in January, for the first time, executed orders were higher on foreign markets than on the Italian one, This is very positive news for our international expansion plans. Let's now move on slide eight for a focus on investing.
Investing revenues amounted to EUR 245.3 million in 2020, increasing by 7.1% year-on-year, thanks to volume effect and strong Assets Under Management net sales, driven by a higher contribution by Fineco Asset Management. The strong investing dynamics were confirmed also in the fourth quarter, with revenues increasing by 5.6% quarter-on-quarter, and by 11.3% year-on-year. Please note that management fees in the year increased by 4.6% compared to 2019. The quarterly increase was 5.2%, with management fee margins stable. Let's now move on slide nine for a focus on our cost. This slide once again confirms efficiency to be part of our DNA, and core in our bank, representing a clear and unique competitive advantage.
Operating costs stood at EUR 269.6 million in 2020, with the usual seasonality among the quarters. Let me please highlight that in the last part of the year, we decided to spend additional EUR 1.3 million of marketing costs in Italy, given the extremely favorable conditions. On top of this, we recorded higher staff expenses, as in December some employees canceled their annual leaves given the unexpected lockdown in Italy. Excluded this one-off cost and EUR 7.2 million of marketing costs in U.K., operating costs grew only by 4.4% year-on-year. On marketing costs in U.K., let me please remind you that, given the positive feedback reached so far in the acceleration of the business, we decided to spend more compared with the initial guidance.
Going into the details, 2020 non-HR costs stood at EUR 170 million, excluding U.K. marketing expenses and the additional marketing costs in Italy in the fourth quarter that we decided to spend to catch up growth opportunities. They only grew by 1.3% year-over-year, confirming our strong operating leverage. Finally, staff expenses stood at EUR 99.5 million in the period, increasing by 9.9% on a yearly basis, excluding a EUR half million cost for the annual leaves canceled in December due to lockdown. The increase is mainly due to the growth in the workforce related to the business development and to the internalization of some services after the exit from UniCredit Group. Let's now move on slide 10.
In this slide, we summarize the breakdown of the bottom line in the fourth quarter. Within the provision for risk and charges, we released EUR 2.9 million related to a positive adjustment on systemic charges, thanks to a lower than expected growth of deposits compared to the system. This once again proves the effectiveness of our initiatives to absorb our clients' liquidity. On top of this, after having refunded our clients for banking fees for the smart repricing, we also released EUR 6.3 million of provisions that were set aside in the previous quarters under the line provisions for risk and charges. Let me confirm that the full effect of the smart repricing on the whole customer base is now in place starting from January 2021. Finally, we recorded EUR 2.3 million of higher provisions related to our sovereign exposures.
This was not driven by the underlying quality of our bond portfolio, but by the accounting process according to the IFRS 9, under which we had to update the macroeconomic scenario after COVID-19 outbreak. Let's now move to slide 11. You can see on the left-hand side of the slide, commercial loans grew by almost 23% year-on-year with the usual strict control on credit quality. Let me remind you that our lending is offered exclusively to our loyal customer base, our deep internal culture allows us to fully leverage on big data analytics.
This translates into a commercial cost of risk very well under control, decreasing at 10 basis points as of December 2020, in line with our guidance of the cost of risk between 10 basis points and 15 basis points, which is confirmed also for 2021, even considering the present context of COVID-19 outbreak. Expected losses for mortgages and personal loans remain very low, thanks to the quality of our lending portfolio. As a confirmation of the latter, we granted only less than 300 requests for mortgages moratorium. Let's now move on slide 13 for a focus on our capital ratios. Fineco confirmed once again a rock-solid capital position on the wave of a safe balance sheet.
Let me remind you the strong recommendation by ECB and Bank of Italy in December 2021, 2020, that provides to refrain from paying dividends or to limit the dividend payment until September 2021. Dividends are recommended to remain below the minimum amount between 15% of cumulated 2019, 2020 profits. 20 basis points of 2020 Core t ier one ratio. For Fineco, the more stringent condition is the second one, corresponding to EUR 7.6 million. We decided to refrain from distributing dividends until next indications from the regulators. In any case, our intention is to give back our excess capital to our shareholders at the first window of opportunity.
Please note that 2020 capital ratios consider the allocation of 100% of the 2020 profits to reserves. Common equity tier one ratios stood at 28.56% as of December 2020. Risk-weighted assets stood at EUR 3.812 million. Let me please highlight that increased risk-weighted assets is partially related to our treasury activity. This should not be considered as a run rate going forward, as we are very confident to deliver on the new industrial initiatives we are introducing to reduce customers' liquidity, and are completely in our hands. Total capital ratios stood at 41.68% as of December 2020.
On slide 15. As you know, 2020 has made it even clearer that Fineco is in the sweet spot for growth, as the bank was able to gather EUR 9.3 billion net sales with a very strong asset mix. These results was reached thanks to the qualities reaching almost EUR 900 million in January, confirming the solid dynamics seen last year. Let me please spend a few words on important development we have observed in 2020 on the recruiting activity that has been historically driven by an aggressive approach by the industry in overpaying financial advisors with huge upfront. Last year, we have experienced an strong increase in the interest of financial advisors to join our bank, thanks to our business model, which proved to be the best positioned to grow in the new landscape.
Indeed, our powerful digital platform allowed our advisors to have no disruption in their relationship with clients and helped them to manage their wealth more efficiently. To sum up, Fineco emerged more clearly as the perfect bank for professionals looking to grow their own business in a sustainable way. This is the reason why we have recorded a net increase of 65 personal financial advisors in our network. Let's now skip to slide 21. In this slide, we summarize our guidance for 2021. Net interest income is expected to remain solid and resilient, we are confirming a decline in the region of EUR 13 million, EUR 15 million compared to 2020. Let me please underline that we are containing the effect of decreasing interest rates, thanks to the smooth runoff of our bond portfolio.
The positive effect from lending with a new production expected in the region of EUR 1.5 billion. A more dynamic treasury management through the yield enhancement strategies and the enlargement of the scope of our investments to non-European govies. The full benefit from the ECB tiering and TLTRO. Let me remind you that we joined TLTRO III on December 16th and borrowed the maximum amount available. We are launching a new platform for tax credits towards the state under the Ecobonus and Superbonus. This is going to sustain net interest income with no use of capital and on which we will deep dive later. Please note that the guidance does not include the additional contribution we expect from the new initiatives that we will describe later.
On investing, we expect revenues increasing high teens compared to 2020, with margins remaining stable. Brokerage revenues are expected to remain strong with a flow that is definitely higher than in the past. Banking commissions related to the smart repricing introduced in 2020 are expected in the region of EUR 20 million, EUR 22 million. Moreover, we are also expecting additional revenues in the region a few millions from the new pricing on the new current accounts, on which we will deep dive later. Operating costs are expected to grow in a range between 4.5% and 5%, mainly due to the increase in the workforce given the acceleration in the growth we are experiencing in the latest month.
Going forward, we confirm our guidance on a continuously declining cost income in the long run, thanks to the scalability of our platform and to the strong operating gearing we have. We expect our Core tier one ratio to remain above our floor of 17%. Leverage ratio is expected to remain above 3.5%. Cost of risk is confirmed in a range between 10 basis point and 50 basis points, even in this environment, thanks to our high-quality lending book. Finally, we expect a robust and high-quality net sales with a lower component of deposits, thanks to the new initiatives we are undertaking. Let's now move to slide 22. The recent events have generated a gigantic opportunity and have increased the speed at which we are growing, as we are benefiting from the acceleration of the structural trends in place.
January net sales are only the latest confirmation of this big jump. This is why we are launching a set of new initiatives to take full advantage from the powerful strengthening of the flight to quality in our direction. Let me now go briefly through the new initiatives. First, thanks to the powerful flight to quality we are experiencing, we can afford to strongly focus our commercial strategy only on net sales in Assets Under Management through a change in the incentive scheme of our network. Second, we will further increase financial planners productivity through new software developments. Third, we will improve the quality of our client base, focusing our target market on the upper end.
In particular, we have introduced a new pricing for the new current accounts, and we'll be strongly focused in transforming full liquidity current accounts that have been inactive for an extended period of time. Fourth, third-party savings accounts through our platform in order to further reduce the amounts of clients deposits with us. The second one will allow us to manage tax credits towards the state. All this set of new initiatives will allow us to be more selective in the growth we are pursuing, resulting in a better quality revenue mix, coupled with a lower growth of our balance sheet. Let's now go through the details of the initiatives for each business area, starting from the slide 23. Let's start with banking.
Thanks to our high quality balance sheet, low risk investments policy and strong fintech DNA, we are able to put in place new industrial initiatives to sustain our growth. By integrating together treasury initiatives with business actions, we aim to better manage clients liquidity and offset the headwind coming from the lower interest rates environment. This confirms once again that Fineco is a very agile and fast moving company. Let me spend a few words on the most recent ones. First, we will launch a new platform to manage the tax credits towards the state under the Ecobonus and Superbonus. Thanks to our strong liquidity position, we'll buy tax credits in order to sustain the net interest income with an interesting yield, no use of capital as the counterparty of the credit is the state.
Please note that we can afford to be particularly aggressive on these initiatives as our strong operating leverage allows us to cope with the complexity deriving from the granularity of the single fiscal credit to manage. Thanks to the fact that we act as a withholding agents for our customer on their big brokerage volumes. Second, we will launch a multi-brand platform to distribute third parties savings accounts. The results will be a lower amount of clients liquidity with us and a higher contribution to revenues, with no pricing on the new current accounts to better control the flight to quality and be more selective in our client acquisition, focusing our target market on the upper end. Please also note that we have introduced a new termination clause on new current accounts, allowing us to close them if only used to park an excess of liquidity.
Fourth, we will be more proactive and undertake more actions to transform full liquidity current accounts that have been inactive for an extended period of time. Let's now move on slide 24. With regard to the investing business going forward, we expect revenues to keep on growing as a result of a combination of strong volume effect coming from the acceleration of structural trends in place and the resilient margins despite the cautious approach held by clients. Let me please go through all the details of the new initiatives we are undertaking to strengthen both the volume effect and increase the operational efficiency by Fineco Asset Management. First, as announced, we are changing the incentive scheme of the network, which is now only targeting net sales in Assets Under Management, and in solutions with a strong risk management.
Since Fineco Asset Management already allow us to have a daily look through on each solutions, we expect a strong acceleration in direction of its products. Second, we will continue on accelerating financial planners productivity through new software developments to be more efficient in transforming deposits, leveraging on big data analytics. This is also going to help us exploit the strong potential of asset held by our customer with other players, mainly in the private banking segment. Please note that an important portfolio portion of our 2020 net sales was the result of private banking clients increasing their share of wallet with us thanks to the superior customer experience we delivered. Third, Fineco Asset Management is confirmed to be key in our move to accelerate the conversion of deposits into Assets Under Management.
The penetration of Fineco Asset Management retail class total assets reached 23% of FinecoBank's total Assets Under Management at the end of 2020. More in depth, the penetration FinecoBank's funds reached 33% compared with 29% on December 2019. Going forward, we expect, first, a continuous extraction of additional operational efficiency. Second, the increase in Fineco Asset Management volume resulting in a geometrical growth of its margins contribution. Third, our Irish company is developing a new product range based on advisory services by third parties, which is going to make the value chain even more efficient. Finally, in 2021, Fineco Asset Management will also widen its product offer by adding new solutions focused on equity and sustainability. Let's now move on to slide 27. Let's now deep dive on our brokerage initiatives.
As you know, our strategy is to progressively increase our ability to extract value from the vertical integration of the business. We have successfully done this in asset management business through our Irish company, and we are now applying the same strategy with the leveraged certificates. We will launch our offer in the first half of the year in becoming issuer, market maker and distributor. This will allow us to convert, over time, low value flows in other, on other issuers into our own. The market size of this product in Italy is relevant, equal to EUR 13 billion in volumes and EUR 100 million of estimated revenues. On top of this, we will also target volumes on leveraged ETFs and covered warrants.
Please note that the vertical integration of the business, coupled with the strong market share and the full control we have with the relationship clients, allow us to be particularly confident on this new initiative. Finally, let me highlight that today the board of directors approved the binding offer for the acquisition of a 20% stake on the Hi-MTF venue, which will increase our ability to extract value from the vertical integration on brokerage business, thanks to our clients' strong volumes. Please bear in mind that all these initiatives underline how the continuous reshape of our offer is a key structural component to explain the increase in the flow of our brokerage revenues. I will now leave the floor to Paolo Di Grazia, our Deputy General Manager, for an update on the development on our U.K. business on, slide 30.
Thank you, Alessandro, and good afternoon, everybody. Our one-stop solution offer in the U.K. is proving to be very well welcomed, and our marketing campaign is providing a strong boost to quality client acquisition. As you can see on the left-hand side of the slide, since the start of our marketing campaign, we have recorded a strong acceleration in our customer acquisition dynamics and in the quality of our client base. Let me please highlight that in 2020, we have recorded a stickiness of 90% of our active clients. This is a confirmation that we are not attracting hit and run, highly speculative and volatile customers, but we are attracting experienced traders, loyal and looking for quality offer.
The increase in penetration of active clients on brokerage, representing more than 60% on new current accounts, confirming once again that we are targeting the right clients with the right offer. This translates in a boost of our revenues generation. As you can see on the right-hand side of the slide, 2020 has marked a turning point in our U.K. business and resulted in increasing revenues with an improved mix as OTC and listed products are now the lion's share of growth. Together with our huge operating leverage, this is allowing us to be at the operating breakeven, excluding marketing expenses with the first quarter of 2021.
Let me please add that the strong momentum we have discussed so far has further accelerated in January with around 900 new current accounts added in the month, compared with the 4,800 in 2020. As of today, February has already overcome January figures, showing an even faster acceleration in client acquisition. This also translates into a strong improvement in our revenues generation. On the latter, let me add that in January, we recorded a number of current accounts active on CFDs equal to the one we had in the whole 2020, confirming the effectiveness of our marketing campaign in improving the cross-selling. February is projecting a further record. Thank you.
Thanks to the acceleration of these dynamics, we now expect to reach our first target of 30,000-35,000 good clients well before the initial time horizon we estimated. Finally, in slide 31, we sum up the next steps that are getting us closer to the full launch of our investing offer. In particular the ISA account is now live in family and friends phase, has already recorded an interesting feedback by our clients. While in 2021, we will continue to progressively enlarge our fund offer with the wide pipeline you can see in the slide. Thank you for your attention. I will hand it back to Alessandro.
Thank you, Paolo. Let's move on to slide 33. Sustainability is at the heart of our business model. We were born and have developed as a company always oriented towards the long-term sustainable growth. Aiming to generate a positive impact for all our stakeholders and the society as a whole in the long run. To achieve this goal, we have chosen to follow the path of transparency and fair pricing for services offered, and this is in line with our corporate purpose. To offer clients a quality and the multi-channel one-stop solution with a fair pricing, leveraging on 3 strategic pillars: transparency, efficiency, and innovation. This has allowed us to be, from the very beginning, perfectly in line with an ESG trajectory based on a sustainable long-term view in our revenues generation.
In parallel with this approach, we have introduced a number of ESG objectives to be achieved by 2023. In 2020, many steps were taken in completing this plan, including our adherence to two important voluntary initiatives of the United Nations, the Global Compact and the Principles for Responsible Banking, while Fineco Asset Management signed up to the Principles for Responsible Investing. Let's now move on slide 34. As a responsible bank, Fineco has continued to develop market friendly corporate governance and expand its ESG product offering, strengthening the management of ESG aspects in credit and investment products, and maintaining a constant focus on cybersecurity and other ESG risks.
Moving onto, into the slide 35, Fineco is also recognized as a sustainable bank by the major international rating agency, having been included in the FTSE4Good Index in July 2020, and in the Bloomberg Gender-Equality Index in January 2021. In July 2020, Standard Ethics improved our rating from EE to EE+, a very strong investment grade given to sustainable companies with low reputational risk and strong long-term growth prospect. In addition, MCI confirmed our ESG rating in a scale ranging from CCC to AAA. Finally, our bank positioned itself as one of the best companies in the world according to risk evaluation by Sustainalytics, obtaining the low risk rating equal to 18.7 compared to the industry average of 30.3. Thank you for your time, and now we can open the call to questions.
Excuse me, this is the chorus call conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one in there system t elephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking question. Anyone who has a question may press star and one at this time. The first question is f rom Domenico Santoro with HSBC. Please go ahead.
Hello. Good afternoon to everybody. Thanks for the presentation. Very interesting presentation, actually. I understand, I mean, all the initiatives that you are putting in place to redirect this huge liquidity on your balance sheet into asset management products, which is, of course, the right thing to do, given where rates they're gonna be and looking also at the way sovereign yields are moving. I just wanna understand a bit more, you know, the impact on your P&L. First of all, thanks for quantify the impact on NII in 2021. Given that you're ready, you know, to incentivize more and more your financial advisors, I'm just wondering how shall we look at margins on your products?
I mean, you say that they're gonna be resilient on asset management, but given that potentially you're gonna pay more financial advisors for the right, of course, reason, I just wonder how they could move margins. Looking a little bit more forward, especially the way sovereign yields are moving, I'm just wondering whether you might accept a bit more, you know, pressure on the NII on top of the EUR 13 million, EUR 15 million that you just mentioned in order to get, you know, some better numbers on the asset management that probably we should factor a bit more of the high tier that you just mentioned in terms of guidance on the asset management. The other question is on brokerage.
I remember that you guided for EUR 50 million, more or less, per month, given the structure of the products. Given that now you are also ready, you know, to get more money in the leverage certificates, can you give us a bit more color in terms of guidance? How much should we consider on top of this EUR 50 million in our, you know, model? How much you will get of this EUR 100 million, you know, pot or revenues? The other question is capital and dividend. First of all, did you accrue a dividend in 2021 numbers? I mean, the banks are getting more and more positive in terms of distribution.
Probably it's the right moment, you know, to talk about what you would like to do in September, if things, you know, they come back to normality and you might use a part of your excess capital for dividends or for, you know, distribute part of it. Can you start to give us, you know, some color on this? Then tax rate. I see that consensus, it does have a flattish tax rate, so is ignoring, you know, completely the patent box. Also the way FAM is, you know, is getting more and more money. How can you give us a guidance on the tax rate for the next two years? Thank you, and sorry for the long question. Thanks.
Thank you very much for your questions. Let me start from the beginning. First of all, it's absolutely very important the point you raised on liquidity because it's clear that the net interest income is the final recipient of everything we are doing. We think that one of the, usually something that sometimes is a little bit misleading in terms of approach is to think to net interest income as a standalone component of the bank. Because it's clear that if you keep this as a standalone component, it's not, it's quite evident that the continuous run-off of the portfolio is bringing down the net interest income.
At the same time, clearly there is a strong impact that is going to be caused by everything we are doing. Clearly, in the guidance we gave on Assets Under Management remains to some extent cautious because we are not still embed. Because I want to be extremely fair and transparent. The speed at which the bank is growing over the last few months is really huge and is month by month taking us by surprise. Before in embedding this outcome in strict guidance, we prefer to be absolutely 100% sure that this is really solid.
It's clear that the progression we are observing in terms of increase of the productivity of our financial planners in moving into Assets Under Management is really big. At the same time also, it's like to say that the bank has changed dimension. We have entered in a completely new dimension. Clearly, it's clear that the more we are accelerating in Assets Under Management direction, and the more this is going to have a double effect, increasing further the revenues expected into investing. At the same time, reducing the heading on the net interest income, because the less liquidity we have to invest and the less we have to invest in zero yielding bond, for example.
Clearly this is very important to keep in mind. Regarding the incentives to the financial planners, the new incentive scheme is based on the concept that we are focusing our network just on Assets Under Management, but for a very simple reason. The net inflows, the growth is so strong, so incredibly strong that we don't need to incentivize them for getting new clients and assets because they are coming. We can concentrate our financial planners just in moving clients into the Assets Under Management products.
It's clear that, for example, if we look to the numbers we are, the numbers on Assets Under Management over the last few months, clearly the progression is clearly higher respect to what we are embedding in the guidance. As I was saying, we prefer to maintain a cautious approach before embedding in a guidance something that is building up. The point is that the more we are accelerating in direction of Assets Under Management and the better is for investing revenues, but is also good for net interest income as well. It's not then something that is penalizing the other.
I would like to remind also that, underlying the importance, for example, of how the bank is so very well positioned for buying fiscal credits, because Fineco, differently from other banks, we are extremely profitable. Our profitability is absolutely stable and continuously rising, so we have no volatility in our profitability. Differently from the other banks, we have the huge advantage that we are running the largest brokerage platform in Italy. Based on the fiscal Italian system, we are paying in substitution of our clients their capital gains. We have an additional ammunition in order to buy fiscal credit. Coupled together with our capability to manage granular business, this is generating an absolutely great opportunity.
Finally, I would like to underline that we are going to launch practically a new asset class that is comparable to Assets Under Management. Because the new platform in which we are providing for our clients, term deposits of other high quality banks, it's not different from an Assets Under Management product. This again, we expect definitely an absolutely very, very high contribution. Personally, my personal expectation that probably going through next year, the headwind represented by net interest income is going to be completely offset. Probably, I don't want to be too optimistic, but I have some aspiration to reverse this decline in net interest income, thanks to the combination of these actions we are taking.
On leverage certificates, it's as we have not too much to add. Is a market that at the moment is generating more than EUR 100 million of revenues. At the moment we are getting by leverage certificates, something that is the region of EUR 2 million. Our market share on retail brokerage is above 50%. I'm not saying that we're going to get a 50% market share on leverage certificates, because clearly it's too much. You can imagine that there is a quite wide way, a quite wide room for getting additional commission from this business.
On capital and dividend, we can confirm what we probably regarding the point on the accrual of dividend 2021 numbers. I don't know, Lorena, our CFO. Lorena, can you give some more color on this point, some more details, please?
We have not decided yet the amount of dividend that we will be able to distribute in 2021. As already said by Alessandro, we will distribute our excess of capital.
The point is that we think that the right approach to keep is to wait for the final conclusions. I'm totally with you that there is a very high probability that by September 2021, the rules related to the dividends paid is going to be absolutely relaxed. Our goal is to give back to the market everything that is in excess of capital we are building up.
On the tax rate, this year, the tax rate has remained flat, but mostly driven by the fact that the very quite large growth in brokerage, this has increased the amount of revenues generated in Italy, and this has contributed in maintaining the tax rate flat. We expect that going forward, probably our tax rate is going to start on keeping on declining. Again, Lorena, if you want to give some more details on the possible evolution of the tax rate, please.
We expect in 2021 a slightly decline given the expected growth of the contribution by Fineco Asset Management to the consolidated income. Please bear in mind that the precise contribution of this effect will depend on the relative weight to the consolidated income of both Fineco Asset Management and FinecoBank. Also based on the success of the new initiative on transformation liquidity into Assets Under Management that we have introduced in our market presentation. Regarding patent box, as you know, we have obtained the renewal, the confirmation of the renewal by Italian Tax Revenue Agency regarding the software for the period 2020 and 2024. We don't expect changes also in the methodology used for calculating the positive contribution of patent box. We expect a linearity in the going forward.
Can I ask you just a follow-up question on the unrealized gains that you have in the sovereign portfolio at the moment?
Is in the region of EUR 1 billion.
They are not in the capital, of course. All right. Okay, thanks.
No.
The next question is from Azzurra Guelfi with Citi. Please go ahead.
Hi. Good afternoon. A couple of questions. Coming back to the dividend point, would you expect or would you aim to do a distribution in the fourth quarter of this year if the rule has relaxed in September? Is it something that investors will need to wait for the dividend of 2021? If you can just explain to us why you decided not to pay even a small dividend for this year. Is it logistic or is it if you can just spend a couple of seconds on that. The second question is on your ESG. Thank you for the additional information.
It's just a question about what are your main focus in the next few months on developing your ESG strategy and how do you control this at, in terms of governance and at board level? The last question is on your U.K. business. You are expecting to expand the product range in Q1 and also with the launch of the ISA product. Would you expect this to have an increase in terms of number of customer interacting with you, or more in terms of increased asset wallet of this existing customer because you offer one of the key product in the U.K.? Thank you.
Yes. Thank you. Regarding the dividend, clearly, as soon as it's going to be possible, we are going to distribute the dividend. If there is a window of opportunity in the 4Q, we are going to consider to pay a dividend to our shareholder. The reason why we decide not paying any dividend is exactly what you were raising because EUR 7 million of dividends practically is nothing. W as much more the administrative complexity to go in that direction.
We prefer to wait because again, unfortunately for banks like Fineco, the regulation is extremely penalizing because probably the regulators, they are not considering that there are banks like asset gatherer in the reign. That is quite counterintuitive because it has been allowed to pay more dividend to banks that they are exposed to higher risk and less to banks that are exposed to less risk. We are living in a regulated world, and so we have to accept the rules. On the ESG main focus, in the next few months, I'm going to leave again the floor to our CFO. Please, Lorena, if you want to give some more color on the next future steps and on the, on that direction, please.
Yes, thank you. We have defined a set of ESG goals that are explained in our non-financial statement. We will publish our financial statement in the next weeks. These main goals are related to six areas: human resources, responsible finance, financial education, supply chain, relation with the shareholders and the environment. We have worked on set up a corporate governance appointment and sustainability committee that have approved this first step of the first set of sustainability goals for the period 2020 and 2023. We periodically monitor these goals inside the bank and with the approval by the sustainability committee.
On the growth in U.K., Paolo, if you want to give more details regarding what we expect to get going forward. Thank you.
Yes. Hi, Azzurra . Basically, you know, in U.K. we still have a few clients because we have 11,000 clients right now. We need to increase our customer base, of course. We also need to get the right clients we want. I mean, we don't need to get on board millions of clients, they worth nothing. We have to get on board clients they can create value for us. I would say we will measure the U.K. business, of course, mainly on the increase of asset share wallet. It's a few things for now. We need to focus on acquiring more clients, but good quality clients.
The next question is from Enrico Bolzoni with Credit Suisse. Please go ahead.
Hi, good afternoon. Thanks for the presentation. I have a couple of questions. One on your new platform to basically provide a third-party deposit to your customers. It sounds very interesting. It's actually something that various player do in the U.K. I have two question related. One, which kind of margin would you expect to make on such deposits? The second is, how would you balance the possible risk, if any, you think that suddenly some of your clients would prefer to choose these products rather than actually going into AUM product? My second question is regarding the U.K. Previously you gave some guidance in terms of extra marketing expenses. Now you have a new guidance for the year of between 4%-4.5% in cost growth.
Does this means that we should not expect any sharp increase in marketing expenses in the U.K. this year? Related to that, you know, a key date in the U.K. is the fifth of April because it's the fiscal year when people basically need to put money into their ISA. What should we expect in terms of actually marketing campaign for the ISA account? Seems to me that so far there's a lot of push on the broking account. In a way almost feels that now could be the perfect timing to actually get also a lot of clients that would like to open an ISA type of account. Last question please, on the acquisition of Hi-MTF.
Can you just give some further clarity in terms of, you say you can extract more value, practically what that would mean, what that would imply? Thank you very much.
Thank you. Let me start from the first questions. You're totally right. What we are preparing to do here in Italy is quite similar to what is, for example, done in U.K. In terms of, clearly from a certain point of view, there is not such a great difference between an Assets Under Management solution and the term deposit, and this is the way we are treating.
First of all, the banks that we are on board, that are going to be used for cooperating we together are banks that they are absolutely not in collision with our business model because they are doing, they have a completely different business model and so they are, they have no interest in managing their clients' assets. Second, the concept is that Fineco is, you have to look to Fineco that is going to become more and more, less and less a bank and more and more a platform. A platform enabling the clients to reach their goals. Clearly we see exactly the contrary because the clear term deposits are remaining an interesting product for Italian clients.
What is making them sometimes reluctant is that the approach is not user-friendly. As usual, Fineco is going to create a platform that is going to be currently with our DNA, absolutely smooth, incredibly easy to use. Second, we are going to act exactly like we are acting on the asset investing platform as a kind of filter, so providing to our clients just exclusively banks that we consider absolutely best in class and absolutely solid and sound. If you put everything together, clearly there is absolutely for us, it's going to be different.
To have the clients, buying an, I don't know, a money market fund or, an, a term deposit, probably in terms of margins for us is going to be better the second one. The margins, probably we are going to stay in the region of between 10 basis point and 20 basis points. This clearly, this is a quite, big change respect to the fact that the liquidity on the marginal way is going to be negative, for the bank. To move in a direction which liquidity is going to become something that is, absolutely, at the same level of an Assets Under Management product in terms of impact on the balance sheet and profitability. It's, we think that it's an absolutely fascinating, direction.
Again, it's confirming that the real strength of Fineco is the concept that Fineco is a platform making possible for our clients to fulfill their goals. On U.K. again, Paolo, if you want to elaborate a little bit more in terms of guidance in terms of marketing and market And also on the ISA campaign, please, Paolo.
Yes. Basically, we don't, right now we are planning to spend pretty much the same we spent in 2020. Of course, we are open to increase our budget if we see that there is a strong acceleration, that there is a need to improve the spending, to increase the spending. Right now the forecast is about EUR 6.5 million. Again, we are ready to increase the budget during the year.
On the, actually also I have to say that the campaign, the money we spent in 2020 are paying off very well because we're starting to acquire a good, very good number of clients as we said in the presentation before. In January, we had a very strong acceleration. In February, even better than January. It seems that we spent very well the money, and so we don't need to put in the place more money for now, but this is the situation. On the ISA account, yes, we are ready.
We have already tested with friends and family where we have a couple of hundreds of clients already using the ISA accounts and ready to open to the old customer base. We have in mind to launch a campaign on the ISA. Mainly we probably we will launch a promotion giving rewards to the clients that will transfer funds in and use the ISA account. Also we are going to spend money on dedicated advertising, ISA dedicated advertising. This is pretty much the plan. Jumping to the question on the Hi-MTF, how to extract value.
The, the concept is pretty simple because Fineco, we have to remind that is a, is a market in the market at the moment because we are then, we are in control just on the regarding the Italian market. We control 27.8% of the total volumes. In this is considered also the institutional volumes, despite the fact that Fineco is probably, you know, is not involved in any institutional business. Clearly is by far the largest, the largest player in the market. The possibility to have an, an alternative venue means that we can be much more flexible in terms of new products to bring to the market, listed products, for example.
Also we can, we can expect also looking forward to become more efficient in the volumes management. This, for example, if you look to some other markets, for example, in Germany. Germany is a market in which is the, the alternative values to Deutsche Börse are the common rules. For example, in Germany, we are cooperating quite a lot with, for example, with Equiduct, that is an alternative venues and so on. Clearly in within in entering in this new venues is going to give us the possibility to become even more flexible and agile in launching new products.
To be able to extract more value from our clients' volumes. Because for sure the Fineco is going to bring quite a lot of contribution of this market, considering the dimension that we have.
Thank you. It's very helpful.
The next question is from Angeliki Bairaktari with Autonomous Research. Please go ahead.
Good afternoon. Thanks for taking my question. Can I ask a couple of follow-ups, first of all? With regards to the third party savings accounts that you will be offering, will this be from Italian banks only or also any other European banks? What do you expect to be the headline remuneration of those time deposits? Considering that you mentioned around 10 bps to 20 bps that you will earn on those, I would imagine that the headline remuneration for the customer will be much higher than that. Will there be an automatic switch from one provider to the other as time deposits lapse? That's my first question. Second question on brokerage.
Could you give us a number of the percentage of the volumes that you have internalized in 2020 versus executed in exchanges? I noticed in your presentation, in your guidance for loans, that you are now guiding for much lower yields on new loan originations, especially in mortgages and personal loans in 2021 relative to the guidance that you had given in 2020. Is that attributed only to lower benchmark yields or do you also see price competition in Italy? Thank you very much.
Thank you. At the beginning, we are going to use, we are going to cooperate with Italian banks. In a second phase, clearly it's going to be enlarged also to other European banks. In terms of yield, in case it's at the moment, I don't know, Paolo , where is the market right now for depends on the maturity of these deposits. They're ranging probably between 50 basis points and 100 basis points. Depends on the length.
On year. Yeah.
Yes. This more or less is the, what we, you can expect, that is going to be received by the clients. When we are referring to a great customer experience means that, for a Fineco client, it's going to be possible to s witch automatically from the current account to these deposits in a very easy way, so just pushing a button. This is the way we are used to work. No, we are not, we are not planning to make a switch from a deposit to another because in any case, we don't think that we need to do that. Again, but in terms of approach, it's not going to be too different from the same approach we are providing to our clients with our investing platform. Again, a term deposit is not such a great difference with an Assets Under Management product.
On the internalized volumes 2020 versus executed in exchanges, I don't know if Paolo or Lorena, if some of you has the number, otherwise we have to return to you. I don't know, Paolo, do you?
Yes. Yes, I have it. I have it.
Okay.
It's, in the range of 25%-30%. Yeah, it's pretty much stable.
Regarding the lower yield on mortgages and so on, is not due to the price competition, but is just related to the dynamics of interest rates. Clearly, as you can imagine, we are now the largest part is transformed in a variable rates, because clearly we don't want to run an unbalanced position on the asset liabilities management side. Clearly the most part of the, for example, the mortgages production is practically transformed in a variable rates. The declining yield has been mostly driven by the continuously declining interest rates.
Thank you. If I may just follow up on the internalization of volumes. Do you think there is a possibility for that to increase as you get more active clients? Or do you think it's very difficult to increase that, you know, due to technical reasons as the orders are very diverse?
No, we think that the more the business is growing and the higher is the opportunity to internalize clients orders. In fact, Fineco is in a quite sweet position because the combination of large volumes and the granularity of the volumes, the quality of the clients. Because in order to be successful in internalizing clients orders, you need to have the combination of huge volumes and high quality volumes. Clearly the yes, definitely, we have the possibility to increase even more the component we are internalizing.
Thank you.
The next question is from Elena Perini with Intesa Sanpaolo. Please go ahead.
Yes, good afternoon, and thank you for your presentation. I've got actually two questions. The first one is, I know that it is not easy to answer, but on a potential run rate for the brokerage revenues for the current year, I was wondering whether a level around EUR 50 million per quarter, like in the fourth quarter of 2020, could be considered as a possible one. Also taking into account that you are going to launch new initiatives like the leverage certificate and so on. Second question is on operating costs. Just a clarification. The guidance of the growth that you gave in the presentation takes the full year 20 level, including the U.K. costs as a starting point. Thank you very much.
As usual, to give a precise guidance on the run rate on brokerage is always extremely complex because as you know very well, the brokerage by definition is characterized by companies that they are not completely predictable, like the volatility of the market and so on. A ssuming if you look to the, for example, because last year has been characterized by the first quarter that has been clearly incredibly volatile. Clearly you cannot use the, particularly the sum of these months as an example of the run rate because we cannot rule out to enter in a same level of volatility also this year, but it's we think that the probability is low.
At the same time, we had the third and the fourth quarter that has been much more normal because characterized by an absolutely decent volatility, but not so incredible like we had in the second quarter. Clearly if you look to the second and the third quarter, it's something that my opinion is something that is not so completely irrational to look at. It's clear that a word of cautiousness is mandatory because as I was saying, there are components that we are not controlling because it's not just the volatility of the market, but for example, the volumes. Frequently there is a tendency in just looking to the VIX.
The VIX is just one component, because if I have, the VIX is telling to me how frequently the market is changing direction. What is even more important is the volumes that we have on the market. In any case, I think that the third and the fourth quarter has been a good quarter for brokers, but not such as incredible as has been the second quarter. Looking to that quarter, in my opinion, is not something that could be used as an interesting observation point. On the operating cost, just asking Lorena to confirm that the guidance we are giving is including the U.K. cost as a starting point. Am I right, Lorena?
Yes. Yes. It includes.
Perfect
the U.K. cost.
Yes.
Okay. Thank you very much.
The next question is from Alberto Villa with Intermonte. Please go ahead.
Hi, good afternoon and congratulations for the results. I have a few questions from my side. The first one is back on the U.K. for if you can provide us with the revenues generated in 2020, and if you have a target for 2021 in terms of revenues. Again, on foreign operations, you were considering moving into other countries, Germany, France. I was wondering if you, Alessandro, can you give us an idea of what is the state of the art on those plans, and if there is something more you can add on your plans to enter these markets? The other question is on the repricing on the new accounts.
Do you believe this will refrain some growth of customers or the impact will be minimal on that side? Then, finally, back again, sorry, on dividends. You mentioned many times about the fact that you will distribute the excess capital as soon as you can. I was wondering what we should consider as ex-excess capital. You now have a CET1 ratio of 28% and a target of being above 17%. I was wondering what we should consider as, let's say, a normal dividend policy, after what has happened recently, so in the future, and what would be the fair excess capital you aim to distribute to shareholders. Thank you.
On U.K., then before leaving also to Paolo to add some more comments. On U.K., it's a little bit difficult to give a target for 2021 for the very simple reason because the acceleration of the business U.K. has been quite sharp over the last couple of months. We now we are clearly because U.K. is a market different from Italy, is an extremely. Italy is a little bit more, is a little bit slow in reacting when you are bringing something that is new. U.K. is an extremely irrational market. Clearly the acceleration is quite important. Practically we are entering in a brand-new dimension.
To give you an precise guidance before we have to understand exactly the new dimension in which we are entering. I don't know, Paolo, if you want to add some few comments on this point.
Yes. Yeah, I agree with you, Alessandro. It's our total focus right now is to just spend in the right way our money and get the, as I said before, quality clients. The offer is very well, it's positioned very well. We are acquiring clients that are coming to us to for listed products, then we can cross-sell them to OTC products. The circle is working very well in these days. It's probably too early to talk about revenues, but I think that we are very positive in the next few months to give you a more precise guidance.
On expansion abroad, clearly our plan is we are taking our time. Our plan is pretty clear. We want to have the U.K. perfectly up and running, so to be sure that is definitely going very well. Later on, we are going to start on planning the entrance in another country. At the moment, it's too early to give a precise indication on which country and with which timing. On the repricing on the new accounts, the point is exactly the opposite.
The reason why we introduced this repricing, because the pressure we are experiencing in terms of new business that is coming to us is so big that clearly there is a very clear imbalance between demand and offer because it's really huge. In any case, if you look to our numbers in January, nearly EUR 900 million in January, that typically is a slow month that's characterized by quite evident seasonality is the demonstration. February as well is progressing very well, in a pretty strong way. By the way, few days ago, we recorded a brand new record in client acquisition in one single day. Nearly 1,500 new clients in one single day.
That is absolutely huge, considering that we don't have any marketing campaign in place, we are not offering interest rates and so on. They are just clients coming to us through the word of mouth. For this reason, we Clearly, the decision to move in that direction is a decision in order to keep this growth in the right direction, because we want to be sure that we are taking on board exactly the kind of clients we want to take on board. In any case, with the new price we introduced, Synergies is going to remain in terms of ISC, that is the way the Bank of Italy is calculating the expensiveness of a current account, is going to remain one of the most convenient bank.
Clearly, it was absolutely necessary to introduce this new repricing because the pressure we are having in terms of new clients and assets is so big that clearly it's the right move. Absolutely we are not concerned regarding this point. I don't know, Paolo, also on this point, if you want to Because we discussed a lot on these points, and so on, what do you expect?
Like, yes, we were talking this morning about this, I don't see any impact on the acquisition. I mean, it's the acquisition is so strong that I think this is just the right pricing to put in place. Even looking at the fresh number in the last days, the repricing didn't have an impact on the acquisition at all. It's, I don't see any impact.
As I was saying at the beginning, the bank has entered in a new dimension. It's likely that we've changed our scale. Now we are, respect, just 12 months ago, practically we are entered in a completely new dimension. We have to react accordingly because our goal is not to get on board the highest number possible clients, but the highest possible number of good and profitable clients. Regarding dividends, we are confirming what we were saying. We think that, considering that we are still in an extremely volatile environment, and with the regulate, because at the moment, the only everything that we are discussing about is based on rumors.
We didn't have any single official statements made by the regulators. We think that it's definitely too early to make such a kind of a call. Again, we are going to judge based on the existing scenario when the regulators are going to be clearer on that point. Clearly our goal is to give back to the markets the maximum amount of excess capital we are building up, because we have no interest in keeping an amount of capital that is in excess of what we need.
Yeah, it's just I understand obviously your point on the regulator and that's perfectly understandable.
For example, just to give you an idea, clearly, probably what we are putting in place in terms of, so there is, and we expect a strong acceleration in the productivity of financial planners. The, we probably, it's possible that the progression in Assets Under Management is going to be stronger than we were initially expecting. Second, we are putting in place extreme initiatives that are going to be, in our opinion, extremely effective in moving clients out of liquidity. I'm thinking about the new platform, also the initiatives in order to keep, to put us in the position to be much more vocal in getting rid of clients that they are characterized by just sitting on a huge amount of liquidity without doing anything else.
Clearly, the more we are going to be successful in that direction, the more this is going to slow down the balance sheet of the bank, the growth of the balance sheet also slimming down the balance sheet. Clearly, the more we are effective and the more aggressive we can become also on the dividend side. Clearly, this is the reason why we cannot be so 100% precise. First because the landscape is completely still uncertain. It's we think that it's the risk to waste time in discussing about something that has not been decided yet.
Second, that the bank is in the process of a very strong acceleration, both in terms of growth, but particularly also in terms of the new initiatives we are putting in place.
Okay. Now I was wondering if you can just let me understand what is the excess capital in your view that the company has. It's the difference between the tier one ratio and the target you have in mind, or it's something different?
The target we are giving on a Core tier one ratio is a first indication, so clearly 70 because our goal is not to be the bank with the highest Core tier one ratio. Our goal is to be a bank with a clearly above the average Core tier one ratio to make our clients and shareholders extremely comfortable regarding the robustness of the bank.
Okay, thank you very much.
The next question is from Filippo Prini with Kepler. Please go ahead.
Yes, good afternoon. One brief question if I may. Getting back for a second on your plan to buy tax credit for work renovation. Is it correct that there is a maximum amount of credit that you can buy that is equal more or less to what you paid in taxes in Italy? Thank you.
No. Is not perfect. Is not exactly this way, because as I was explaining, the Fineco is in a, in an extremely comfortable position. Because the maximum amount we can, we can buy is determined for sure by the profitability of the bank, the tax we are paying. Also there is an a very important component is represented by the, the tax we are paying on behalf of our clients. The big advantage we have that Fineco is the, by far the largest brokerage platform in Italy. As you can imagine, every year we have quite a lot of capital gain that we are paying on behalf of our clients.
Also this can be used for, to be compensated with the tax credit we are buying. On top of that also, Lorena, because the CFO is for sure more, can be more precise than me on this point. Lorena.
No, I can confirm, Alessandro, what you already said. We have a role of withholding agent for our customer and, for this, for example, a capital gain paid by our customers. It is for this reason that we have a tax capacity that is huge, compared with other competitors, for example.
Also coming back to the profitability, clearly, probably you can, as you can understand quite easily, is that considering the business model of the bank, that it characterize to be extremely low risk, stable, predictable. Clearly we have a lot of visibility, because when you are buying a tax credit, you need to have also visibility on your future profitability generation. Clearly, the visibility of the profitability, future profitability generation is much greater for a bank like Fineco, considering the business model we have.
On top of that, clearly there is the huge advantage we have related to the brokerage platform that is giving to us a quite big additional pot that we can use for buying tax credits.
Okay. Many thanks for explanation.
The next question is from Federico Braga with UBS. Please go ahead.
Yes. Hello, good afternoon, everyone. I have a few questions left to follow up, please. The first one relates to the third party bank accounts. Again, just some clarification. Will this be offered to all clients or just to maybe less wealthy or more wealthy clients, just to have an idea? Also with regards to these products, what's the risk that actually you will see maybe some cannibalization or attrition with higher margin AUM products, given the fact that these type of products tend to be pretty successful in Italy, given the high risk aversion of the average Italian clients? The second question is on the brokerage. You showed in the slides how the average new client of brokerage is actually a pretty wealthy individual, followed by financial advisors.
I just wanted to know what has been the feedback from your financial advisors in the last few months in terms of seeing the brokerage as a competition to them or what has been the morale and the feedback with this respect from your financial advisors. Then the last question on the U.K. business. Just what level of AUMs per client would you consider successful, like let's say in five years down the road with regards to the Fineco platform business in the U.K.? Thank you very much.
Thank you, Federico. Regarding the third party banks accounts, they will be offered to all the clients with no distinction. Regarding the cannibalization risk, honestly speaking, considering the absolutely incredible amount of liquidity that still there is on the current accounts of the clients, this honestly speaking is not a risk. Clearly the reward that we can get bringing this new solution is so huge and so big that clearly absolutely there is no risk. In any case, they are going to compete with the very low risk, risky products we are providing for our clients. In this case, in terms of profitability, the difference is not going to be so such as great.
Clearly no, absolutely there is the opportunity we have is much greater than the cannibalization risk on the Assets Under Management products. Again, we then, for us, the more we are able to move to eliminate the liquidity of our clients, this has a, an extremely positive effects. One, that is increasing our fees. Second, is contributing in improving our net interest income. Third, is making our balance sheet lighter. It's absolutely, it's the advantages are definitely much higher than the possible small collateral risk. On the brokerage side, no, but this is a problem that we had very many years ago.
At the very early beginning when we started on putting together financial planners with the brokerage platforms, the immediate reaction by the financial planners was, "Come on, we are, you are competing with us." They realize that the brokerage is an incredibly powerful way for getting on board new clients and also creating a much better relationship with them. As we were describing over the last few months, there is a very evident trends in place that is a kind of contamination and overlapping between the brokerage world and investing world, but they're not too leading.
The same clients are absolutely perfectly aware and confident that for long-term planning, they have to use the financial planners, but at the same time, they are extremely interested in getting a direct interaction with the market. Now financial planners are not against brokerage. It is exactly the contrary. They consider brokerage as an excellent additional weapon that they have in order to make their clients even stickier. On the U.K., I don't know, Paolo, if you want to make some few comments on the level Assets Under Management clients. I don't know. Probably it's a little bit too early to.
Yes, it is probably too early, we know that we're targeting in the U.K., people with more than 100,000 to invest. From 100,000 above. Definitely our offer is into people that have assets. We're not interested in who can run sm all clients. It's too early to think about to talk about the level of AUM, but the target is the one I just told you.
Thank you very much.
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Thank you. Thank you very much for attending our conference and for your extremely interesting questions. As usual, for everybody of you that interested in follow-up, we are here for arranging meetings and digging a little bit more in the numbers and the concepts. Thank you again.
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