Good afternoon, ladies and gentlemen, and welcome to the presentation of BNP Paribas first quarter 2021 results. For your information, this conference call is being recorded. Supporting slides are available on BNP Paribas IR website, invest.bnpparibas.com. During today's presentation, you will be able to ask questions by pressing zero one on your telephone keypad. If you would like to ask a question, please make sure to be in a quiet area to maximize audio quality. I would like now to turn the call over to Mr. Lars Machenil, Group Chief Financial Officer. Please go ahead with your meeting, sir.
Thank you very much, operator. Good afternoon, fine ladies, gentlemen. Trust you are doing well, and welcome to BNP Paribas's first quarter results. In the usual way, I'll take you through the first two chapters of the result presentation, which I trust you have under your eyes, and before handing it over to you on Q&A. In a nutshell, if I can, I mean, what you will see is that BNP Paribas posted very solid results, and this on all fronts. As a background, in the first quarter of 2021, we have seen economic recovery coming through, gradually, thanks to the adapted responses to the health crisis that have been more accommodating towards the economy in general. Besides, governments across Europe continue to extend support measures and introduced new initiatives geared towards economic stimulus.
In this environment, BNP Paribas continued to mobilize its resources, its expertise to support individuals, companies, institutions, and to meet the specific needs of a successful and sustainable economic recovery. In this context, as I mentioned at the beginning, the group delivered very solid results. As evidenced this quarter, BNP Paribas continues to be very well positioned to leverage its diversified and integrated model, its strong balance sheet, and its powerful execution platforms to deliver solid results while strengthening its social and environmental commitments. BNP Paribas did very well on all fronts. If we now move to the presentation, focusing on key messages first on slide three. The mobilization of the group's resources and expertise was illustrated, in particular by over EUR 110 billion in financing rates for clients in the syndicated loan, bond, and equity markets, up 21% versus last year, and also versus 2019.
On the same note, total loans outstanding continued to evolve positively with a 0.2% increase on the fourth quarter 2020. In the first quarter of 2021, this is reflected in BNP Paribas delivering a set of very solid results, and this in all lines of the P&L. Let's start with the one at the top, the revenues. They're up 8.6% on the first quarter last year. Costs evolved 5.4% year-on-year, thus delivering a positive jaws effect. This despite the year-on-year increase of almost EUR 300 million in the Single Resolution Fund, so we had to contribute EUR 300 million more than a year ago. This as a key component of taxes subject to IFRIC 21, so they all fall into the first quarter. Excluding these taxes, costs were up 2.5% in connection with the strong development of the activity in this quarter. Very positive jaws.
When we look to the cost of risk, it's standing at a very low level of 24 basis points, and this across all businesses. Finally, the group's net results came in at a solid EUR 1.8 billion, up 38% compared to a year-on-year. If you now turn to slide five, you can see the total exceptional items of the first quarter are basically stable year-on-year. Here you can see the total taxes and contributions booked as IFRIC 21 in the first quarter 2021, and this for the full year, you can see that they have increased by EUR 279 million, the almost 300 that I talked about just earlier. If you can now swipe to slide six, you can see the performance of the group in the first quarter, accompanied by positive jaws.
Revenues are not only higher than in the first quarter of 2020, which had been strongly impacted by negative one-offs, they were also higher than in the first quarter 2019. Even though the first quarter of 2021 benefited from a rebound effect, it demonstrated that the revenue momentum is doing better than just normalizing. If we keep comparing with 2019, you can see the effect of our transformation with operating expenses 2.2% lower than in the first quarter 2019 when excluding taxes subject to IFRIC 21. These improvement translated in a 20% increase in gross operating income, and when comparing the net income with 2019, it retracted, and this is the net income, so after non-operational items and after taxes, it retracted by 7.8% given the above average non-operating items we saw in 2019.
Also the corporate tax rate in 2021 is at a typically higher level for a first quarter given IFRIC 21, and in particular, the non-deductible nature of the Single Resolution Fund. Having it non-deductible means your tax rate implicitly improves. Improves, goes up. This quarter, it has not seen any counterbalancing effects as we have seen in the past. If we now move a bit more in detail in the lines corresponding to the operating divisions, and let's start with revenues on slide seven. They increased by 7% or 10.3% at constant scope and exchange rates, which is relevant to mention because the euro basically got stronger towards all other currencies. The revenues were up on a like-for-like basis of 1.2% at domestic markets due to the higher financial fees in the networks and strong growth at Arval and Consorsbank in Germany.
They were up 4.4% in international financial services, thanks to a very good performance at Bank of the West and strong growth in the asset management businesses, so asset management insurance, and despite a somewhat less favorable context at this moment for the other businesses within IFS. Thirdly and lastly, CIB's revenues progressed sharply by almost 30%, with a very good performance in each of the three business of CIB. If I can now ask you to flick to slide eight, where we see the costs of our operating divisions. Those were up 2.8%, or just 0.9%, excluding the taxes subject to IFRIC 21, and all divisions delivering positive jaws when excluding those taxes. If we look first at domestic markets, it saw a decrease of 0.9% in cost, excluding these taxes. On the same basis, costs in the networks were down 1.8%.
International financial services costs were down 6.5% year-on-year, with a significant decrease across all its businesses. Finally, CIB operated also with very positive jaws on the back of the positive evolution of revenues and clearly outpacing that of costs by more than eight points. If we now go on to another line of the P&L, cost of risk. I would kindly ask you to flick through the three dedicated slides on the topic, and they start at slide nine. You can see, as I mentioned, that it stood at a low level of 42 basis points over loans outstanding. It was EUR 530 million lower than a year ago, mainly due to a decrease in impairment of non-performing loans, or in technical terms, stage 3. Globally, no release of provisioning of performing loans, so-called stages 1 and 2, in anticipation.
As such, if we label as low cost of risk, they are close to 2019 level. As I mentioned, the reserves that have been built up in stages 1 and 2 are still here. Now, if we take the business one by one, in corporate banking, cost of risk was relatively stable year on year at 51 basis points of loans outstanding. Turning to domestic markets, slide 10, cost of risk remained low at 24 basis points of outstanding in French retail. It decreased in Belgian retail as well at BNL on the back of lower impairment of those non-performing loans. Bringing, for example, BNL's cost of risk over loans outstanding at a low level of 56 basis points on our trajectory to have it gravitate around 50 basis points.
In the other retail businesses on slide 11, Personal Finance saw a sharp decrease in cost of risk, clocking in at 138 basis points of loans outstanding, thanks to its efficient processes of managing delinquencies and its good performance in debt collection. As such, cost of risk at Personal Finance returned this quarter to a level comparable to that seen in the first quarter 2019. Europe Med's cost of risk significantly improved on the back of a decrease in the impairment of non-performing loans. Lastly, Bank West saw an overall write-back of cost of risk as provisioning write-backs on performing loans more than offset a low level in impairment of non-performing loans. If we now finalize the overview of the group and we swipe to slide 12 on the financial structure.
You can see that our common equity Tier 1 ratio was stable compared to a quarter ago at 12.8%. The increase in risk-weighted assets this quarter was indeed offset by the impact of the first quarter 2021 results, itself impacted by IFRIC 21, and this after taking into account a 50% payout ratio. We take the results, and we consider that 50% will be paid in dividend, and only the remainder 50% contributes to strengthening the common equity Tier 1. Let me also gently remind you that 50% of the earnings of 2020 are intended to be returned to shareholders and are therefore also outside of the CET1 ratio. On the other metrics, like leverage ratio, it stood at 4.3% and the group's immediately available liquidity reserve totaled, I have no other adjective, a whopping EUR 454 billion at the end of the first quarter.
The evolution of these ratios goes to confirm the very solid financial structure of BNP Paribas. If we now look at slide 13, you can see that our net book value per share stood at EUR 83.70 at the end of March. At EUR 74.50, our tangible net book value per share has grown at a compounded annual growth rate of 7.3% since 2018. Highlighting our continued value creation through the cycle and through all the hiccups that we might or the economy might have endured during that period. If we then summarize our ambitious policy of engagement with society, and we start at slide 14. The group CSR policy is geared towards meeting the 17 Sustainable Development Goals as set out by the United Nations, and is based on a set of ambitious and measurable targets.
To illustrate this, the group has set itself a target to increase financing to companies furthering the energy transition and to sectors contributing directly to the sustainable development goals, and this for EUR 210 billion by the end of 2022, an increase of 12% towards the levels reached in 2020. If with this, you advance to slide 15, you can see more specific action plans, so the details of what I talked about in areas such as financial inclusion, fight against climate change, and biodiversity. Let me also emphasize that in line with our commitment to fight climate change, BNP Paribas has joined, as was announced this week, the Net-Zero Banking Alliance, launched by the United Nations, and a decisive step in the mobilization of the financial sector. I leave you to peruse slide 16 that summarizes the continuous reinforcement of the group's internal control and compliance program.
With this, we have got an overview of BNP Paribas, and I would now like to take you through the main divisions. I would kindly ask you to advance to Domestic Markets, which is slide 18 to 22. As you can see, Domestic Markets continue to mobilize its resources to support the economy. For instance, BNL continued to grant state-guaranteed loans in the first quarter to the tune of EUR 700 million. Meanwhile, French Retail Banking is preparing for the imminent launch of a new scheme to offer participating loans supported by the French state in the context of its stimulus plan, with the aim to shore up companies' balance sheet and promote investment. Business drive was strong, with loans up 6.5% year-on-year on the back of a rise in corporate loans and a good momentum in mortgage loans.
The effects of the health crisis drove deposits higher, but with a downturn in deposits, for example, in France. All balance sheet savings were sharply up year-on-year. In French Retail Banking, there was a steep rise in life insurance gross inflows to the tune of 44%, while Belgian Retail Banking saw its mutual funds inventory grow by 32% year-on-year. Domestic Markets saw an acceleration of digital users with over 4.8 million of daily connections to digital apps on average, up 37% year-on-year. This quarter, Hello bank! as well as Nickel crossed symbolic thresholds with the number of Hello bank! customers exceeding 3 million, while Nickel reached 2 million accounts opened since its inception. Domestic Markets is also transforming its operational model with, for instance, the ongoing rollout of its service centers across geographies, accompanying the transformation of the networks and the evolution of clients' behavior.
This shared innovative technological platform providing integrated customer request management is now available to 100% of the sales force in French Retail Banking, while its rollout is underway in Belgian Retail Banking. If we look in terms of P&L, revenues were up 1.1%. Looking at networks first, they showed good resilience, and the impact of low-interest rates was partly offset by higher loan volumes and financial fees. Looking at specialized businesses, Arval saw a sharp increase of nearly 20% in its revenues this quarter. Furthermore, personal investors, in particular through Consorsbank, as I mentioned earlier, in Germany, saw a steep rise in assets under management, driven by very strong net asset inflows and market performance, a record number of orders processed in January, and its revenues in the first quarter rise by 19% year-on-year.
If we turn to costs, they were a tad higher due to the steeper taxes subject to IFRIC 21 this year. Excluding these taxes, they were down 0.9% year-on-year, with net perks in particularly down 1.8%. On the other hand, the cost in the specialized businesses evolved by 5%, but in connection with their top-line growth. As already mentioned, Domestic Market showed positive jaws this quarter. Gross operating income was up 4% year-on-year, excluding the IFRIC 21 taxes. Pre-tax income stood at EUR 590 million, marking a 2.8% rise on last year. Excluding taxes subject to IFRIC 21, pre-tax income for the division was up 6.1%. To wrap up Domestic Markets, it saw an increased level of activity this quarter, positive jaws effects of two points excluding taxes subject to IFRIC 21, a low cost of risk, as well as a moderately higher pre-tax income.
That's the first domain. If you now advance to slide 23, 29, you'll see that our International Financial Services division witnessed an overall good business drive despite lingering effects of the health crisis, in particular in Personal Finance. Looking at the overall momentum this quarter, new loan production in Personal Finance evolved very positively thanks to the mitigation of public health measures, but average loans outstanding remain somewhat curtailed by the loss of loan production in the second quarter 2020. Moreover, International Retail Networks of IFS saw a good momentum in fees as well as a rebound in new loan production. Lastly, Asset Gathering businesses saw good net asset inflows as well as a favorable performance and exchange rate effect, largely offset by the scope effect stemming in particular from the disposal by Asset Management of its stake in a joint venture.
IFS, so International Financial Services, continued to roll out its digital strategy with, for instance, 4.8 million digital customers across international retail networks. We now look at the P&L, International Financial Services revenues clocked in at EUR 4 billion, a tad lower than in the first quarter 2020, reflecting the unfavorable Forex impact this quarter, as I mentioned, the euro getting stronger towards mostly all others. Revenues were up 4.4% on a like-for-like basis. Looking at the contribution of now the various components of IFS, what do we see? First, revenues in Personal Finance were down 9.7% due to the reduction in loans outstanding stemming from the health crisis. Second, revenues at constant scope and exchange rates in international retail networks saw contrasted evolutions.
They were down 8.9% in Europe-Mediterranean due to a decrease in net interest income, in particular Poland and Turkey, partly offset by positive evolutions in fees. They were up 11.8% at Bank of the West on the back of a higher loan production as well as a non-recurring item. Third, moving to Asset Gathering businesses, what do we see? First, insurance revenues were up 37% thanks to a continued rebound in the savings business and a positive base effect due to the one-off accounting impact a year ago. Wealth and Asset Management saw revenues increase by 5.5%, in particular to the effect of the strong 2020 net asset inflows as well as the positive performance effect in Asset Management.
We now turn to costs, they were down 6.5%, or 2.1% at constant scope and exchange rates, with all IFS businesses seeing a decrease in cost. As a result, at historical scope and exchange rates, IFS operated with very positive jaws of 5.8 points. On the back of this, gross operating income was up 12% on the first quarter, or even 18.5% at constant scope and exchange rates. We then look at pre-tax income, it was up 96% year-on-year, or 104% on a like-for-like basis, and this on the back of the sharp decrease in cost of risk. Wrapping up International Financial Services saw a good level of results, very positive jaws, and a sharp increase in income.
With this, I can ask you to turn your attention to the third division, and this on slide 30 to 33, on Corporate and Institutional Banking, which saw a very strong momentum across all its businesses. In the financing space, new business origination was strong in equity issuances as well as in loan and bond markets. As such, Corporate Banking saw a tripling of ECM volumes led as well as a 13% hike in corporate bond issuances compared to the same quarter a year ago. Loans were down 6.2% due to a normalization of volumes following the spike in utilization in the first half of 2020, as you remember. On the other hand, behavior stemming from the health crisis drove deposits up 22.5% year-on-year, with this trend seen reversed in the last two quarters.
If we now turn to the second domain in CIB, Global Markets saw a still robust activity in rates, Forex, and credit, as well as a record activity in equity and prime services. The level of global bond volumes that were led grew by 27% compared to the same quarter a year ago. Last and third, Securities Services saw an increase in assets under custody and administration, as well as a record volume of transactions this quarter. Besides these volumes, CIB reaffirmed its leadership in Europe to its ranking in loans, bonds, cash management, and corporate banking, and it also reached top 5 status in corporate banking in Asia for the second year in a row. In the fast-growing field of sustainable finance, it ranked number 1 in global sustainable bonds and number 2 in global green bonds this quarter.
Now, if we turn to the P&L, on a like-for-like basis, CIB revenues were up 30% compared to the first quarter last year, with gains in all three business lines, including a 22% increase in Corporate Banking, with gains in all regions and a very good performance of the capital markets platforms in EMEA. Secondly, a 47% increase in Global Markets, with a record activity in equity and prime services, and a very good performance in absolute terms in FIC, up 11% when compared with the first quarter of 2019, which demonstrates market share gains and ongoing strengthening of the platforms. Albeit, down 16% compared to the first quarter of 2020, due to a less buoyant environment for rates and Forex. The third one, security services, up 5% on the back of the strong business drive and steady growth by the platform.
If we now look at the cost of CIB, they were up 16% year-on-year in connection, which is very strong activity. With revenue growth outpacing significantly cost evolution, CIB operated this quarter with, again, I have no other adjective, overwhelmingly positive jaws of 11 points at constant scope and exchange rates. On the back of this, it is no surprise that the gross operating income was up over 60%. CIB generated EUR 751 million of pre-tax income. In other words, 3.7x the income achieved in the first quarter of 2020. Wrapping up the businesses and CIB in particular, a very strong performance in revenues, overwhelmingly positive jaws, and a sharp increase in income for CIB this quarter.
If with this, we have done the businesses, and if I can ask you to switch to slide 35, which concludes today's presentation, and this before I will be switching to you for Q&A. As key takeaways, I would like you to keep the following in mind. First, there is a context of gradual recovery in the economy. We have already discussed the benefits of adapted restriction measures on the overall state of the economy. Looking ahead, the progress in vaccination campaigns will pave the way for further loosening of restrictions that will lead to an acceleration in the economic recovery in the second half of the year.
Two, an increase in revenues compared to the first quarter 2020, also versus 2019, which goes to show that with its platforms, its breadth of expertise, the strength of its balance sheet with respect to liquidity and capital, BNP Paribas is very well-positioned indeed to carry on stepping up its market share via new clients, increased wallet share, and more servicing. Seizing more than its fair share of opportunities arising from the rebound in activity in the second half of this year. Three, a positive jaws effect and strong growth in gross operating income, despite the hikes in taxes subject to IFRIC 21. Furthermore, all divisions operated with positive jaws, these positive jaws at group level remain a key priority for the whole of the year. Four, a low cost of risk at 42 basis points of loans outstanding.
As indicated, this improvement was basically driven by lower impairment of non-performing loans, which reflects our conservative risk stance, hence ergo, the Stages 1 and 2 that have been built up remain fully available. 5, a solid net income, not far from the level achieved in the first quarter of 2019. You will have noticed that the momentum seen in the first quarter of 2021 was very good indeed. As a matter of fact, better than we had anticipated. With this in mind, the overall trend for 2021 is likely to be even higher than our earlier indications back in February. Because we think it matters, there is a sixth one. I would like to conclude by reminding you that BNP Paribas joined the Net-Zero Banking Alliance launched by United Nations.
Fine, ladies and gentlemen, I thank you for your kind attention, and I'm now pleased to take your questions.
Thank you, sir. Ladies and gentlemen, if you would like to ask a question, please press zero one on your telephone keypad. Please lift your handset, ensure that the mute function on the telephone is switched off, and you are in a quiet area to maximize audio quality. We will take questions in order received. We will take as many as time permits. If you find that your question has been answered, you may remove yourself from the queue by pressing zero two on your telephone keypad. Again, please press zero one on your telephone keypad if you wish to ask a question. We have one first question from Mr. Jean-François Neuez from Goldman Sachs. Sir, go ahead.
Hi, good afternoon, Lars. Thanks for the call. I just wanted to ask on, so there was a strategic initiative that you guys talked about with one quick comment in your fourth quarter presentation, which was about your savings businesses in general, all considered, including private banking, asset management, and insurance. In the results today, there was a strong improvement in the profitability, notably with strong jaws, as you pointed out. I just wanted to understand whether you could tell us more about this initiative, what you're planning to do, in particular, whether that entails inorganic growth or anything of the sort, because it's obviously an important driver of ROE.
The second question I wanted to ask on the strategic stuff was with regards to the Deutsche Bank business integration, which is supposed to take place in the second half as far as balance transfers are concerned, and therefore the P&L, I guess. I just wanted to understand your outlook more precisely, because we are really a couple of months away now from taking them on board. What you think the balance, the revenues, and also the ancillary trading revenues that we could expect with regards to this business? Just on a pure numbers question, I just wanted to understand whether you could tell us how the TLTROs are booked, because we see a big revenue in the corporate center, but also a big decline in some of the net interest margins in the businesses.
I just wanted to try to understand whether there is any offsetting or whether the corporate center is purely the private equity business that was mentioned in the slide. Thank you.
Thank you, Jean-François. First of all, with respect to savings business. Indeed, savings business, we basically consider it as an important step going forward. Why? Because as you have seen, there is a lot of deposits that are available that have been deposited with us, and where it is of interest, in particularly to our clients, to have them oriented into savings businesses different than just deposits. That means that our insurance, our wealth and asset management activities are really focused around that. That is what you have seen. You have seen we have been ensuring that we have the right segmentation, we have the right product, and that is basically what is leading to this step-up that you have seen. We will continue to focus on that, and we will continue to focus on the set of products that are needed.
Yes, from time to time, it could be if there is an aspect that we missed, that we can look for a little bolt on, but that is in the normal run-of-the-mill of activities to further strengthen our savings business. That's the first one. Secondly, when it comes to the prime brokerage activities, I can just repeat and have to repeat once more that this is an outstanding platform, an outstanding team, and that indeed, we are in the process of having it onboarded by year-end. These things are progressing very well. We're very pleased with it. It is basically on track. When it comes to the overall guidance that we have given on objectives, they basically remain the same with that one exception, that year 2020, well, the pandemic impacted a bit the overall demand.
The overall objectives remain the same, but one should see them with taking out 2020. Basically, we said it's going to be 2022. The run-of-the-mill will probably be 2023. Overall, it remains a very solid, very strong activity, and we're very pleased to bring them on board. When it comes to the TLTRO, as you know, the TLTRO for us, it's a bit run-of-the-mill, right? It's a bit financing. We look at how to optimize it in general over time. When you mention evolutions in the corporate center, in the top line, yeah, the main thing is, I don't know exactly where you were, but I have an idea where you were a year ago, namely also in the banking environment.
You saw that the evaluations which are accompanying principal investments were rather low a year ago and are back to a normal run-of-the-mill this year. That's basically the one thing driving this. Jean-François, those would be my three answers.
Thank you, sir. Next question is from Madame Delphine Lee from JP Morgan. Madame, please go ahead.
Good afternoon, Lars. Thank you for taking my questions. Just a quick one. Just going back to your comment that the outlook is now looking stronger than when you gave the comments on 2021 with Q4 results. Is that mainly coming from the strong start of the revenues with revenues up 10% at constant scope and exchange rate in the operating divisions, or is that because your cost of risk is 42 basis points? Is that a mix of the two? Is it possible to get a bit more details actually about domestic retail, France, Italy, Belgium, in terms of how much headwinds we should expect in these divisions, which are clearly still struggling from a top-line perspective. The second question is on the cost side. Just a quick clarification, because I think your guidance was EUR 30.2 billion.
That was excluding the contribution to the Single Resolution Fund. Now that it has increased by EUR 300 million, is the new guidance EUR 30.5 billion? Would that actually include also the EUR 400 million of IT costs? Just wanted to understand whether we should stick to that, or because the revenue environment seems to be better, are you going to overshoot that? Just last question, just briefly going back to Jean-François's question on TLTRO. Is it possible to get how much you have taken up in March and what was the contribution of the first quarter to the different divisions in terms of benefit? Thank you very much.
Delphine, thank you for your questions. If I synthesize my stance on the outlook. Intrinsically, looking forward, our stance remain the same. In the sense that we see the vaccination tapering up, and so we anticipate that in the third quarter, there would be a return to elements like consumption, growth, and the like. That assumption remains as we had foreseen. What we do observe, however, at the beginning of the year, is that the overall handling by the economy of the elements of the lockdown and so forth, have been strong. This is not just like in one element. If you look at all the elements of the P&L, you see that strength from the revenues. If you look at the revenues in domestic markets, you're seeing them up. If you look at the International Financial Services, they are up.
If you look at corporate banking, they are up. Basically, the revenues that are up, the costs that are contained, and the cost of risk that are low. As again, the cost of risk is low at BNP Paribas because the Stage 3 is very low, yeah. We didn't consume any of the other ones. That is what we see. We remain on the pivotal point in the third quarter. That remains the same. What we see is that running up to the summer, the reaction that we see with our clients and the clients that we can accompany in their needs is very strong. The fact that we are a very solid bank allows us to accompany our clients in all of their needs.
Be it on balance sheet need, services need, we can accompany with all of that, and that is what we will continue to do. That's on the outlook. On retail. Yes, of course, in retail, let's not forget, retail, or so-called domestic retail, it's a third of the bank, and it's indeed a third of the bank that is exposed to the Euro and the interest rate environment related to it. First of all, it is one third only of the bank. Secondly, if you look at it, we are very diverse in services. We are providing a lot of related and adjacent services, that generate fees, and that compensates for that. Also, there are the volumes which are up. That's all the dynamics that we see on that one third of the bank that is our so-called domestic markets.
When we look at the guidance we gave on the cost, what we basically said is that the cost would be for the year 2021, they would be stable, but they would be stable looking through the Single Resolution Fund, so taxations and eventual parameter changes. That's basically what we continue to stay at. Look through the Single Resolution Fund and look through eventual scope changes and costs will be stable. When it looks to the TLTRO, so there is no magical wand, right? As I mentioned, for us, it's overall optimization that we do. Sometimes we go for structured financing, we go for TLTRO, and overall, that is not a main difference. We basically take it as part of our overall funding. You shouldn't read any of our evolutions boosted by it in it. Delphine, that would be my four answers.
Thank you, Madame. Next question is from Mr. Jacques-Henri Gaulard from Kepler Cheuvreux. Go ahead.
Yes, good afternoon. Just two questions from me, please. First, you haven't given a, let's call it a precise financial guidance for 2021, which you did last year. Can I assume it was just because it was an exceptional year of pandemic, and you wanted to guide people a little bit more precisely? The second question is, I would like to come back on last quarter's focus on Arval, which I thought was interesting. Again, you have phenomenal numbers from this asset. You communicate more on it when you go to their website, particularly with detailed balance sheet and everything. What's behind communicating individually on Arval like that? Do you have a consolidation plan in mind or potentially an IPO? You just love this business because it grows.
Basically, obviously, you probably got me the next question after that is, when do we segregate it within the BNP Paribas consolidated accounts? Thank you, Lars.
First on our guidance. The thing is, if I clarify, we have given an orientation that we anticipated revenues to be up and costs, as I mentioned just before. What we see in this environment in the dynamic is that our customers are basically performing well and are leading to further demands. That's basically and particularly because we, BNP Paribas, we are there, we, BNP Paribas, have the full width of services. What you basically see is that our revenues are up particular to us and above what we've guided for. That is why I said that our guidance, what we have now, what we see now with the dynamic that is taking place around BNP Paribas, we even see a stronger revenue evolution for the year.
With Arval, no, there is nothing to be looked at in the sense that we are very pleased of this activity. We're very pleased to have it grow and the likes. For us, we're very pleased to have this diversification in the funding and the activities that are going on. Let's not forget, it's the same thing. You were there. In 2014, in our slide deck, we didn't even talk about any other domestic markets. People said, well, we would like to know domestic markets and other domestic markets. We started to add a slide, and so now we saw that there is also demand for that, and so we give color a bit to it. There is nothing else to see it, just that we are very proud about the activity, and it is part of our diversified setup. Jacques, that would be my answers.
Thank you, sir. Next question is from Mr. Jon Peace from Credit Suisse. Sir, go ahead.
Yeah. Thank you. Hi, Lars. On the last call, you said that your through-the-cycle cost of risk was 50- 55 basis points. Now we see you well below that. Was that a conservative estimate? Do you feel that it's actually going to be a bit lower than that? Was this quarter a bit of a one-off, and we might see a bit of a pickup in cost of risk through the rest of the year? My second question, please, is on the FIC business. You mentioned market share gains. Actually, it does look like your market share took a bit of a dip this quarter to something that was a bit below the 2,000 run rate. Is there anything unusual in what happened? Is it really just your mix being a bit more macro, a bit less credit?
Should we imagine it picks up again in the rest of the year? Thanks.
Jon, thanks for your questions. First of all, on the cost of risk. Yes, our overall guidance, let's say, for the run-of-the-mill environment, is indeed 45-55 basis points overall standing. That's basically what we have in mind. What we've guided for is that we were a tad above that last year because of the S1 and S2, so the forward-looking elements that we took into account. When we gave the guidance, we basically said, well, it's going to be within that range. What we see is that indeed, in this first quarter, we are at the lower side. That lower side, again, I cannot stress it enough, it doesn't take any write-backs out of the S1 and the S2. It's really the underlying, the non-performing loans that needed lower levels of provisioning. Let's not forget, how does that work?
You can have an average setup, then you can have one file, two files. You can have specific files. If you look through our presentation, you didn't see impacted by a specific file. Yeah. We didn't have that at all. There was not one element that was driving it up. Yes, we clocked in at the first quarter at the lower side, and as I said, if you look forward, as we haven't written back anything of S1, S2, we confirm that we will definitely be within that range. Yes, the way it looks, it will be rather on the lower side of that range than on the upper side of that range. That is a bit where we stand on the cost of risk. Then with respect to your second question, where you hurt my feelings a bit, Jon.
If you look at market shares, we're not losing any market shares. I know in these domains, often market shares are labeled by top line. They look at top line. When you compare top line, well, you have to look at the holistic approach. If you look at the top line of BNP Paribas, it is improving. Look at the top line of CIB, it's improving, 25%. Look at the top line of global markets. Oh, what. It's going up by more than 40%. Yeah. You see all of these domains. You can have some activities, if you look at it, what you call macro, so everything which are basically rates and Forex. They were an overall demand, which was a tad lower than a year ago. Remember in what environment we were. That's what you see.
We are active in that, and we're also adding in credit. Maybe the credit picked up a lot in the U.S., where we are a little bit less in relative terms present. The overall trend that you see, as I said, it's very solid. We have better results than even in 2019. We are having a very strong setup. We continue to consolidate. We continue to have those market shares. Indeed, if you compare with other banks, you have to look at what the diversity and what the mix of activities they're having. Jon, those will be my two answers.
Thank you, sir. Next question is from Mr. Matthew Clark from Mediobanca. Sir, go ahead.
Good afternoon. Two questions, please. First one's on the prime brokerage business. Can you give us some comfort that if Archegos had been onboarded, or had failed after it had been onboarded to your platform rather than when it was still on Deutsche Bank's platform, that you still wouldn't have suffered any losses from it? And maybe just say whether your appetite for prime brokerage expansion and to extend balance sheet has changed as a result of this event. Second question is on the French retail banking net interest income. Could you just give us a bit more commentary on the difference in net interest income between the first quarter and the fourth quarter? It's attributed, I think, on a year-on-year basis to lower rates, but the rate outlook, particularly at the long end, wouldn't really change that much first quarter versus fourth quarter.
Struggling a bit to understand why such a steep decline over that shorter period. Thank you.
Thank you, Matthew. First of all, if we look at prime brokerage. Prime brokerage is a very interesting activity that can lead to a lot of client interaction, cross-selling, and the likes. The issue that you mentioned for me is an idiosyncratic one. It doesn't mean that all of a sudden prime doesn't make sense. Therefore, we continue to be very much fond of this activity and looking forward to onboard it. When it comes to your specific question, how does the onboarding work? The onboarding works that in order to really manage the risk of a client, you need a platform. You need a very powerful platform, and then you need to act on that. That platform today is still basically operated by Deutsche Bank and is in the process of being transferred.
That basically means that while it is operated on the side of Deutsche Bank, basically the cost of risk is on their side. Once it gets transferred, let's not forget, we basically transfer the system. Whenever a client is transferred, it goes through the process of BNP Paribas to know your client, know your customer, and so on, that it goes through. That's basically what we are doing. Again, as I said, it's an idiosyncratic issue. That's basically it. We feel still very pleased with this activity. We apply and we will apply all of our underwriting kind of skills, and that's basically where we stand on it. When it comes to the French retail, when it comes to also the net interest income margin, there are a couple of dynamics which are a bit different.
If you look at the retails that we have from Belgium, France, and Italy, there are different dynamics. There are different dynamics on what happens on the deposits, on what happens on the credits. One of the dynamics, which is a bit particular to France, is that you had these state guarantees. There was a pickup in state guarantees, but which were basically not redeployed by the corporates that took them on. They were just redeposited in the deposits. That's what you basically have. You have an increase in state-guaranteed loans that basically lead to a material pickup in deposits. That is why you see the volumes in the balance sheet that drive for the income is that. That's basically that.
Just to finalize off, when it comes to the prime brokerage, when you mentioned Archegos, it was mentioned in the press that we were not part of it, and that is a fact. I confirm that. That's a bit my two answers to your questions, Matthew.
Thank you, sir. We have the next question from Madame Phelbé Pace from Société Générale. Madame, please go ahead.
Yes, hello. It's Phelbé Pace from Soc Gen. Thank you very much for taking my questions. I have two specifically. On ECM revenues, which I think you book in the corporate banking division, if I'm not wrong, it seems that this activity was specifically strong this quarter. I just wanted to ask you if you could give us some color about the prospects to expect from the segment in the near term. Is it basically fair to assume that ECM could remain a source of support for the corporate banking top line in the coming quarters? The second question is on the Single Resolution Fund and the contributions you make to this fund, which obviously were quite significant this quarter and have increased quite significantly year-on-year.
Correct me if I'm wrong, but I think that in the past, you told us that the contributions to this fund cost you about 2% of ROTE. I appreciate this might be early stage, but is there any comment you can give us on that? Any specific timing we should have in mind about when a final decision should be made on that matter? If the final decision that was eventually made wasn't the one you expected, does that mean you have to potentially downgrade your 10% ROTE target at some point? Do you think you can compensate this impact somehow, and if so, how? Those are my questions. Thank you.
Thank you for those questions. Indeed, on ECM, you have observed well that it had a strong evolution, and it's indeed booked where you mentioned it is. What you see is that, I'm not giving any guidance on the P&L in the middle of the quarter, but if you look at the pipeline of what is happening in April around Europe, you can see that one can assume that it will remain strong for the second quarter and beyond. That's on ECM. When we come to the Single Resolution Fund, what it is, the Single Resolution Fund contribution is there, listen to the words, for a Single Resolution Fund. That fund has been identified as a set of deposits. It has a size, and it has the intention to have it filled with the elements by the year 2023.
That is why they said this is the period. At that moment, that's when it's going to stop. That's why also the amounts have gone up because there are more deposits in the system, so the fund has to be larger. That's why the step-up has been stronger. That is basically what I have said. It's for the creation of the fund. The fund is well on track, making sure that the fund reaches the amounts that it has to do is being done. That's where we stand on this. Those will be my two answers.
Thank you, Madame. Next question is from Madame Giulia Aurora Miotto from Morgan Stanley. Madame, go ahead.
Yes. Hi, Lars. Can you hear me?
Yes. Loud and clear.
Excellent. Two questions from my side as well. The first one is on the commitment to net zero that you have flagged a couple of times during the presentation. Did you have an estimate of what impact such a commitment can have on your P&L in terms of potentially foregone revenues and profitability? That's my first question. The second question, sorry, it's a bit more of a numbers question. The corporate center. I struggle a bit with the volatility in the underlying cost line. Is there any guidance that you can give us there? What should we expect? Thank you.
Giulia, can you repeat your second question?
Yeah, no, the second question was on the corporate center. I was saying that I struggle a bit with the volatility of the cost line, so was wondering if there is any guidance that you can give us on that one.
Sure. Thank you, Giulia. First of all, on the Net-Zero, it is indeed relevant. Sadly, this is a call, otherwise you would see I have my 17 Sustainable Development Goals badge pinned on my jacket. It is very important for us as an objective of the why of redoing banking. In fact, you shouldn't be afraid of the P&L. We basically are working on these trends since several years, we have been given clear guidance on how our counterparty, our clients, have to move. If they don't move, we basically step out. Yes, that stepping out makes you lose a bit of business. However, you win much more than that from the related activities. Look at it, look at our rankings when it comes to green issuance and the like. We're a very solid player in that.
Overall, if you look at it's something that we do for the good of the planet, and it also does basically is positive for the P&L. On your second question, on the corporate center of the costs, yes, costs, there can always be a little bit of elements going up and down. Generically, we've guided that underlying, so without eventual exceptional costs that can fall one or another, is we said that over the year, we have at a run-of-the-mill, EUR 450 million costs in the corporate center. Giulia, that would be my two answers.
Thank you, Madam. Next question is from Mr. Omar Fall from Barclays Capital. Please go ahead.
Hi there. Just a few questions from me. Firstly, I wanted to come back to other domestic markets and Arval, please. A very specific question, was there a big car sales result this quarter, please? I think the number was like, EUR 160 million last year, according to Arval's numbers. Clearly, the market trends have been extremely good for used car pricing. I'm just wondering if there's a bit of a one-off that we have to adjust for in future periods, just so that there's no surprises. It's a very important revenue line now. Secondly, on Europe-Mediterranean, it looks like NII's gone down by well into double digits since you say that fees are stable, yet revenues are down 9%, and that's at constant currency. Could you give some more color on what's happening there, please? Especially because loan growth was actually positive at constant FX.
I know there's been rate cuts, but still, well into double digits seems high. Finally, just wanted to touch on the costs in CIB. The policy of jaws, very clear, but it's still like a marginal cost income ratio of like 70% in the markets business, which is high. Is that just reflective of what we're seeing at peers, which is needing to keep pace with bonus accruals, or is it like a funny true up of the weird equities number in Q1 of last year, or is it something more structural? If you could just touch on the costs there, that would be great.
All right, Omar, thank you for your questions. First of all, on Arval. The value of cars that they basically redeploy is not leading to a one-off capital gain. I remind you that under IFRS, we have to put at fair value those cars, they evolve, in this case, they didn't really evolve. They're definitely not a one-off no major evolution, the run-of-the-mill is what you see. When it comes to Euro Med, the net interest income, yeah, the evolution that you see, you have to be careful too, there is of course the Forex effect, right? The euro got a lot stronger versus the zloty and the lira. That's one thing. The intrinsic trend is a bit similar. You have pressure of the margins that the volumes can compensate somewhat, not entirely.
That's a bit the trend that you have also in those areas. When it comes to markets, just to think, our costs are not in particularly specific to anything because what you have to look at is the Single Resolution Fund that I talked about. The cost of IFRIC that come along, if you see the fraction that goes into global markets, it is very high. If you look without IFRIC 21, you'll see that the cost income stands at 63%, which is very fine if you see the way we handle this activity, how we manage and control and risk-averse the elements. That's basically the three elements, Omar.
Thank you, Sir. Next question is from Madam Anke Reingen from RBC. Madam, please go ahead.
Hello. Thank you very much for taking my questions. The first is on capital. I just wondered if there was any TRIM impact in Q1 and if the guidance you'd given before of a 30 basis points hit is still what we should expecting for the rest of the year. Secondly, I had a question on the balance sheet, your leverage ratio, ex the exemption is 3.9%. I noticed that there's quite some considerable increase in the securities on balance sheet. I just wondered what's driving this, and what is the benefit in the P&L? With the exemption of the central bank deposits that's running out at the end of June, would you think that will be extended given the continued inflows of deposits and also your growing liquidity buffer?
On that point, your liquidity buffer is so large relative to the balance sheet size. Are you looking to increase the yield on the EUR 450 billion, which could help the revenue line? Thank you very much.
Anke, thank you for your questions. First, if I take the capital, so we stand at 12.8%, and there is this TRIM exercise. As you know, the TRIM exercise, we basically found we at BNP Paribas, because the TRIM exercise provides a validation of the advanced modeling. From that point of view, it's fine. What is good to hear is that the ECB basically said that for them now it's finalized. Remember, it's an exercise they started years ago that would have been finalized in about last year already, and then they basically ran in, given the COVID and so forth in this year. Now it's done.
What that basically means, though, we anticipate that while during this quarter, we will get some finalization letters and so forth, and so, well, I don't know, but I would guess that it's not going to be 30. I would take an impact of, let's say, 20 basis points, is something that I would expect that could come this quarter and then basically be done with it. That's on the capital. When you look to another element on the balance sheet then, so the leverage ratio. On the leverage ratio, there's two things. I'll first handle the overall evolution. What you typically have is that towards the end of the year, there is typically a lower demand from our clients, and there's also the banks that are typically tidying up their balance sheet and so on.
There is less demand, therefore, that means that the leverage ratio goes up. That's basically the end of the year. When the year starts again, well, those balance sheet elements are basically being used and are basically leading to a lower leverage ratio in the first quarter, the second quarter, the third quarter, and then it goes up again in the fourth quarter, and the story begins again the year thereafter. That's basically where we stand. There is nothing more to say about it. It basically, typically, we gravitate around 4% on leverage ratio, and this time it's a 3.9% and rounded to a 3.9% instead of rounded to a 4%. That's basically where we stand. There is not much more to say. As you know, for us, this is not a constraint, right?
We operate on the risk-weighted, and that's where the elements come from. As we manage our risk weights and our CET1 in a diversified way, we gravitate with the leverage around 4%. It's not a concern. On your question of the ECB, which basically said you can take whatever you deposit with us out of it, and so our 3.9% goes up to 4.3%. Again, that is just a visual thing. Will it be extended? Well, I don't know. On one hand, I guess not.
When they said they will take a view over the summer of how the pandemic is evolving, I would assume that if you look at the results, like for example, that we have published, that they will consider that all in all, things are under control, and therefore dividends can be resumed, and therefore this ECB kind of rules that they applied would drop. That would be my view. Again, you should ask them. That's basically what I would think. Anke, that would be my answers.
Sorry, to just on the liquidity buffer, do you think you have room to increase? I guess it's sort of like currently as a negative yield to increase the yield and help revenues. Thank you. Because it seems sizable.
Yeah, no, on this one, the main thing is that our objective is the liquidity is to redeploy it. It's what we said earlier. We want to redeploy it in saving products which are equity-related, insurance-related. That's basically our aim. If our customers, our individual customers, have these deposits, our objective is not to turn them down. Our objective is to migrate them into more and other equity and investment-related products.
Yes. Thank you.
Thank you, madam. Next question is from Mr. Kiri Vijayarajah from HSBC. Sir, go ahead.
Yes. Good afternoon, Lars. A couple of questions on the prime brokerage side of things. Firstly, are you seeing any change in risk appetite among the competition there? Do you expect any impact, say, on the pricing environment for prime services? I appreciate it's kind of early days in terms of gauging the market repercussions of Archegos, just your early thoughts on that would be helpful. Secondly, more on the regulatory side, are you finding more regulatory scrutiny on your prime brokerage business in more recent weeks, particularly as you kind of ramp up to migrate more of those customers over in the next few months? Just some color on how that side of things is panning out on the prime brokerage side. Thank you.
Kiri, thank you for your questions. No, indeed, the things that we saw in the market, as I said, is idiosyncratic. That's why I don't see the regulators stepping up because of that. Moreover, as it is idiosyncratic. Well, yes, we consider it to be opportunities, yeah. We have the platform, we have the risk management. It's an idiosyncratic issue. For us, yes, we consider it opportunity. Kiri, that will be my answers.
Okay, got it.
Thank you, sir. Next question is from Mr. Andrew Stimpson, Head of European Bank Research at KBW. Please go ahead.
Hi, everyone. Hi, Lars. Thanks for taking my questions. I've got one on Prime Finance. Then one on ESG as well, please. Maybe I'll ask Mr. Clark's question a slightly different way. As you're bringing in those assets from Deutsche Bank, are you confident that you would have excluded the Archegos Capital Management assets or positions or strategy? Then also interested if there's any kind of gauge, whether it's a percentage you'd give on how many assets you've already discovered that you would not be onboarding or that you'd look to actively exclude so far, please. Then on the ESG side, slides 14 and 15, very interesting as always. On slide 14, it basically shows you're looking to add about EUR 11 billion of SDG compliant financing volumes in each of the next two years.
Given that a lot of that will come from bond markets, and I would hope that BNP would actually be able to deliver above that target. Several of your peers are now coming out with much more ambitious targets on SDG financing, albeit with longer time frames that they're looking at. How do you see that EUR 11 billion per year developing, say, over the next decade? Then, and also the split between loans and bond issuance between them. My guess is that at the minute, that's mostly coming through from bonds. I'm wondering how you feel about how that might pivot into loans going forward as well, please. Thank you.
Thank you, Andrew. Basically on your question related to prime brokerage, as I mentioned, just take the press said Look at it today. We said we are going to transfer those activities. What else can I say? Press is basically saying that in the list of clients, we are not present, and press is right. That's basically what else can I say, man? That's where we stand on this. On ESG, listen, if you see that some parties are saying things, if I look at it, they're saying it by the end of the decade. Whereas for us, it's now. We have been a player now for several years in this. We really are on the vanguard of these things, of implementing it on.
If to give you example, if you look at the metrics that we are implementing in the way we invest, the way we serve, we are putting those metrics in all of our systems. Well, you should not, but you could give us the credit that we're really pushing this forward well above the average.
Absolutely. Do you see, and you're clearly winning in issuing green bonds. Do you see the potential for some of that benefit to come through on loan growth in the future as well?
Yeah. We already basically see it. There is already a material part coming from that. We feel confident that this trajectory is now well embarked. I guess those will be my answers.
Okay. Thank you.
Thank you, sir. Next question is from Madame Azzurra Guelfi from Citi. Please go ahead.
Hi. Good afternoon, Lars. I have a couple of questions. One is on BancWest. Clearly, results have been showing progress this year. The question is, with all the development that are going on into the regional bank space in the U.S., would you think differently about these activities that you have? Also in light of maybe a more benign regulatory backdrop in terms of capital return. The other one is on ESG as well, if I can. It's linked on your green bond issuance. You're clearly among the top player in this space. I wanted to know if you could elaborate a bit on how do you see the investment through from the funds that you facilitate in terms of risk management and control on the deployment of the funds. If I may, a very quick question on wealth and asset management.
Could you give us a breakdown of the profitability between the wealth and the asset management activities? Thank you.
Azzurra, thank you for those questions. When it comes to our activities in California. As you know, we're very pleased with them. California is a very solid economy. On top of that, we have very strong management, starting with the lady who is in charge. They are doing extremely well. From that point of view, the profitability is there. We are ramping up further those returns. We're happy campers with that activity. Now it is true, we have seen some steps of potential consolidation, and so we keep our eyes open to see what is happening, but that's basically where we stand. On your question on ESG. Yeah, the way we do this, and to ensure how all of these things are really not greenwashing.
To make sure that it is into the metrics and that it is into the right metrics is indeed an effort. I don't know if I mentioned this, but for me, it basically reminds me of 2005. Azzurra, you were basically too young at that time, but in 2005, there were all things stepping up, like you had to be looking at the risk-return and so forth. All banks, we all prepared for that. Then came Basel with new regulation, and basically all banks had to throw out what they had done and have a new, regulated approach of having it done. That was a lot of effort. I basically see this now again. I feel like back, like in 2005, and that the efforts are done, that you get the right metrics, and that you get uniform metrics, and that you get them followed.
That's one of the efforts that we are doing. That's basically it. Listen, we give the profitability for each of the homogeneous blocks that we have, and so for us, that is basically one, and so we have to leave it to this, Azzurra. Thank you for your questions.
Thank you, madam. Next question is from Madam Flora Bocahut from Jefferies. Ma'am, please go ahead.
Yes, thank you. Good afternoon, Lars. I have two questions as well, if I may. The first question is actually going back towards the French NII number for this quarter. I just would like to understand, once again, why such weakness when we look at the French NII in Q1 versus Q4. A 7% decrease versus the previous quarter while sight deposits actually decline. I suppose that the deposit margin pressure must have eased in the quarter, and the loan volumes are actually up as well in the quarter. Just trying to understand what drove the change when we compare the NII in French retail in Q1 to Q4. Second question is on the asset management business. You've made a huge progress there. Revenues are up, costs are down.
Actually, the cost income ratio that you posted here in Q1 is at the best level since Q1 2018, if we remove IFRIC 21. There's been a big organic recovery. Obviously at the moment, there's an ongoing consolidation in the asset management sector. Some of your peers of similar size are looking for a buyer or a partner. I'd like to see how you think at BNP about potential inorganic growth in asset management. Do you feel like your business has the right size as it is? Could you potentially be interested, not just in a bolt-on, but a properly transformative deal, in the asset management business? Thank you.
Flora, thank you for those two questions. First, on French retail net interest income. I mentioned that there is the aspect of the volumes that I talked about. There is another element which is relevant in particularly Q4, Q1, which is the evolution of the specialized businesses. What is driving the income is of course the volumes and the margins. It is also the specialized businesses that we have in there. The specialized businesses, I think of like a factor and whatever, were activities that were impacted in 2020 by the lockdown and the likes. That really rebounded well in the first quarter. That is a bit the driver, the second element of driving French interest income. When we look at asset management, yes, asset management is doing very well. What do we see?
It's a bit the same thing as what I mentioned about Bank of the West. We have a strong management in place that is really implementing the directions that we took. There's basically a couple of things. As you know, we talked about earlier that the deposits, we want to also move them into other investment vehicles. Therefore, wealth and asset management is an important part of that. It's part of one of the services that we provide, and so typically we want to keep that in-house so that it is one of our products. We know how it's implemented. We take the responsibility for that. That's basically where we stand, and that's the case for the services that we have.
The question comes, is saying, well, but by doing it together with others and getting size, you can have cost advantages. That would have been true until recently, where you have now systems that are available that sound like a genie out of a bottle that basically provides you operating platforms, which is much larger than your own. You basically can capture the synergies of size without sharing the responsibility on the client side. That's what we're doing. We're happy campers with it. We announced it. You see it in our numbers. I share that on asset management, all is good. Flora, those would be my two answers.
Thank you, madam. We have no other questions, sir. Back to you for the conclusion.
All right. Thank you all. You've seen our results, very solid results. We're well-positioned, I would even say uniquely positioned, to build on the rebounding that we see with our revenues that are up and that basically will continue, the costs that are very contained, and therefore operating jaws all over the place. With that, I thank you very much. Have a good day, and have a good weekend. Bye-bye.
Ladies and gentlemen, this concludes the call of BNP Paribas' 2021 conference call. Thank you all for your participation. You may now disconnect.