Good morning, and welcome to Mandatum's Q4 2025 results audiocast. My name is Lotta Borgström from Investor Relations, and I am pleased to open today's call. I am joined today by our CEO, Petri Niemisvirta, and our CFO, Matti Ahokas, who will take you through the highlights and key developments of the quarter. We'll begin with the management presentation, after which we will move on to the Q&A session, and as always, you can participate either by dialing in or by submitting your questions through the chat. We will review the chat questions once the dial-in Q&A has concluded. Before we get started, a brief reminder that the materials for today's calls are available on our website. With these remarks, I will hand things over to Petri. Please go ahead.
Thank you, Lotta. Let me now walk you through Mandatum's fourth quarter and full year performance. In the fourth quarter, Mandatum delivered another period of continued progress across our core businesses and operational efficiency. The results demonstrate the strength of our capital-light model, our operational discipline, and the trust our clients place in us. For the October-December period, profit before taxes decreased by 14% to EUR 13.3 million due to the lower net finance result and other result. However, our capital-light profit before taxes increased by 28% to EUR 27 million, and its most significant income item, the fee result, rose by 18% year-on-year. This shows that our strategy focus is in the right areas, with profitable growth driven particularly by asset and private wealth management, as well as our corporate business.
The strong growth also highlights the continued improvement in the quality of the group's earnings. Client assets under management reached a new billion euro milestone at year-end, increasing 10% from the previous year to EUR 15.3 billion. Quarterly net flows was lower than the strong comparison period, as a few larger client distribution in alternative investment weighed on the total despite strong underlying sales. The net finance result decreased from the last year to EUR 19 million, but it is important to keep in mind that the comparison period included a EUR 16 million dividend from Saxo Bank. Matti will later walk you through to the composition of the net finance result in more detail.
For the full year 2025, profit before taxes decreased to EUR 182 million, while capital-light profit before taxes for the year increased by 5% to EUR 92 million. It is good to note that the result for the comparison period included more than EUR 10 million related to the insurance portfolio sold to If in 2024. Once again, the fee business performance remains resilient, and underlying client activity remains strong throughout the year, which for us is a top priority. Mandatum's Board of Directors proposed to the annual general meeting a dividend of EUR 0.85 per share, reflecting our strong capital position.
At our Capital Markets Day in June, we introduced our long-term financial targets, including a cumulative shareholder payout exceeding EUR 1 billion over the 2025-2028 strategy period. We are well on our way to what is called, and we place strong emphasis on having the capacity to pay out attractive dividends, both now and the years ahead. The solvency ratio at 169% was once again very strong. It is good to bear in mind that the figure includes the foreseen dividend based on the board, the Board of Directors' proposal, and that it will bounce back to higher levels after the closing of the sale of Saxo Bank. Client activity remains solid throughout the year.
Assets under management reach a new billion euro milestone and increased to EUR 15.3 billion, supported by both positive net flow and a favorable market environment. Net flow for the quarter was EUR 141 million, and for the full year EUR 723 million, which is more than 5% of the client's assets under management. The institutional wealth management flow decreased from last year. The main reason was a few large clients, client distribution related to alternative investments, which offset the impact of otherwise very strong new sales. It is also worth noting that the comparison period was very strong. Corporate net flow, on the other hand, increased significantly from last year. In our corporate business, we maintained our market-leading position, supplementary pensions, and personal funds.
Sales of risk life insurance stayed strong, although they fell short of ambitious targets we have set for ourselves. In the retail business area, sales of risk life insurances developed particularly well, supported by the strong start of our cooperation with Pohjantähti Mutual Insurance Company. The role of key distribution partnership is significant in the retail customer business. One of last year's highlights was the great performance of our wealth management business. Sales of discretionary mandates were notably strong, and overall, assets under management in private wealth management grew by 19% from the previous year. This strong growth also expanded Mandatum's market share. It is great to see our investments in private wealth management paying off, as it is a central part of our growth strategy. During the year, we made strong progress in advancing our asset and wealth management business.
The expansion of our international operations was one of the highlights of 2025, and I'm very pleased with what we have achieved. Growth remains strong, especially in Sweden, and we also gained new clients across Central Europe. Our quality investment products received multiple awards last year, highlighting strong investment performance across several asset classes and fund categories. This shows both the international appeal of our competitive products and Mandatum's ability to build a credible presence outside the Finnish market. Operational efficiency continued to improve, driven by rising income and lower costs. The cost-to-income ratio dropped by 9 percentage points to 94% over the trailing twelve months. As we have said before, our business is scalable, and we have made the main IT investments already, so costs should grow less than income going forward.
At the same time, we have continued to invest in our future. Last year, we hired new salespeople to accelerate growth in both the institutional wealth management and the corporate business areas. Fee margin stood at 1.13%, slightly lower year-on-year due to mixed effects as institutional wealth management volumes increase, while standalone product margin remains stable. Mandatum was once again awarded the Great Place to Work certification, highlighting the strength of our culture and the commitment of our employees. Retaining good people is especially important in our industry. The certification is a clear sign that we have succeeded in creating work environment built on trust and well-being. In November, Mandatum was ranked Finland's best private banking provider in Kantar's Prospera Private Banking 2025 Finland customer study. Our very high customer satisfaction scores tell the same story.
The net promoter score for our wealth management business was very high last year at 80. Our corporate clients were even more satisfied, with the net promoter score reaching 85. Both figures are exceptionally high by any standard of comparison. The exceptional commitment of our people and our strong customer satisfaction are evident in everything we do. Finally, a quick look at our financial targets, which were presented at last summer's Capital Markets Day. Although we are only 8 months into the new strategy period, we are already well on track toward all of our targets. As we look ahead, our strategic direction remains clear. We continue to focus on growing in our target segments and improving operational efficiency for long-term value creation. Thank you. I will now hand over to Matti, who will go through the financials in more detail.
Thank you, Petri. Let's now take a closer look at the fourth quarter result components. As mentioned, our fee result was up 18% year-on-year, with assets under management up by 10%. If we compare it to Q3, our AUM was up by some 3% or EUR 410 million to EUR 15.3 billion. The client fee margins were unchanged in the quarter when looking on a 12-month rolling basis. And more importantly, I think, the product-specific margins were largely flat during the quarter. As Petri mentioned, the cost-to-income ratio of our client AUM continued to decrease according to plan and was below 50 for the first time in our history. Overall, we saw a decline in our costs during 2025, mainly due to lower IT costs.
At the same time, income was up, as you know. The Q4 net finance result came in at EUR 19 million, and, as all of you know, our investment portfolio is mainly in credit instruments, and returns were lower than normal during the quarter as rates increased. In addition, the movements of the IFRS discounting rate components impacted our net finance result during the quarter. I'll talk a bit more about this later on. The result related to risk policies at EUR 4 million in Q4 was back to more normalized levels and up significantly compared to the previous year. On the other result line, there was a negative impact by some EUR 5 million due to updated actuarial assumptions, mainly in the with- profit portfolios. Capital generation is a key success factor to any financial company, and we still continue to consistently generate capital.
Organic capital generation was EUR 60 million in Q4, or EUR 0.12 per share, and the main positive driver here, again, was the increase in own funds. Return on equity was 8.6% in the quarter. As you know, and as Petri mentioned, one of our key financial targets is to grow the capital light profit before taxes by more than 10% annually by 2028 compared to 2024. And if we look at 2025, the reported profit before taxes was EUR 92 million, up 5% compared to 2024. I think it's important to note that in the first six months of 2025, the result was impacted by the turbulent financial markets, the U.S. dollar, FX headwinds, and lower sales. But, the second half was definitely a step change in profitability in the capital- light business.
All segments within capital- light increased their profit sequentially in Q4. The quarter level of EUR 27 million is up by 28% compared to a year ago, and suggests the overall run rate in line with our long-term growth target. Also worth noting again, is that the 2024 comparison figure included the EUR 11 million one-off gain from the transfer of the If portfolios. So, then let's take a closer look at the group net finance result. As mentioned, it was EUR 19 million in Q4, and somewhat lower than the historical average. The with profit investment return in the quarter at 0.7% was above last year, but slightly below the expected return of our portfolio.
Fixed income credit makes up 76% of our own investment portfolio, and in Q4, the return was negatively impacted by mark-to-market adjustments from higher rates and spreads. At the same time, the portfolio mark-to-market yield was up by 30 basis points in the quarter, up to 4.5%, and this is naturally significantly above the cost of liabilities. Our private credit portfolio has continued a positive trend and had a very good quarterly return in Q4. Also, private equity returns were good at 3% in the quarter. The real estate returns were impacted by the Morgan Stanley joint venture transaction write down. If we then turn to the other part of the net finance result, or discounting and the cost of liabilities. As you all who follow the market saw that swap rates increased significantly in Q4.
However, the IFRS rates that we use for discounting increased clearly less in the quarter, and this was the result of a 15-25 basis point lower illiquidity premium in the long IFRS rates that we use. The lower illiquidity premium had a EUR 15 million- P&L impact in the quarter, and this largely offset the positive discounting gains from higher swap rates. The with-profit portfolio interest rate hedging ratio remained at the high level in Q4. However, you shouldn't read too much into this figure, as it varies depending on the tactical view of the fixed income market. Also, remember that the hedging ratio is a relative figure, and the interest rate risk is low in absolute euros, only a few million euros, as you can see from our material.
Of course, the main target is naturally to generate financial profit in on this line as well. Finally, it's worth noting again, that the IFRS discount rate mark-to-market changes have no impact on the actual contract cash flows, nor our dividend-paying capacity. We continue to consistently generate capital. Organic capital generation was EUR 60 million, as I mentioned, and again, significantly higher than the reported IFRS net result. In 2025, we generated capital organically by EUR 301 million, net of taxes, or EUR 0.60 per share. This figure was EUR 0.44 in 2024, and also supports the higher dividend proposal from the board. Our own funds generation increased the solvency margin by 5 percentage points in the quarter and 31 percentage points during the full year.
Actually, Q4 was the first quarter in the history of Mandatum when the SCR from the with profit business was smaller than the capital-l ight SCR. And, I think this is also yet another indication of our transformation journey towards a high ROE capital-l ight group. The fully loaded solvency ratio stood at 169% for the group. And although this number is down, remember that now we take away the impact of the transitional measures of around 15 percentage points. The decrease from Q3 is also due to the larger dividend deduction based on the actual dividend proposal, and this reduced the solvency ratio by 18 percentage points. Worth noting is that the comparable, like for like, solvency ratio was unchanged in the quarter.
However, also worth noting here is that the announced sale of the Saxo Bank shares is expected to increase the solvency margin by around 28 percentage points once the transaction is finalized, as you can see from our material. In addition, the strategic asset de-risking we announced in the June capital market day of the with profit portfolio is expected to further support the capital release going forward in the coming years. Then briefly on the outlook for 2026, not too much to mention here. Our fee result is expected to grow, and the with profit portfolio is expected to decrease compared to 2025.
There is one extra thing worth noting, that the unwinding rate for 2026 is 2.0%, down from 2.4% in 2025, which means around EUR 40 million annual unwinding costs, compared to over EUR 50 million in 2025. All from me. Back to you, Lotta.
Thank you, Matti. Now let's move on to the Q&A.
If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Vash Gosalia from Goldman Sachs. Please go ahead.
Hi, good morning. Thank you for the opportunity. I have two questions, please. So one is on the net finance result, and here I appreciate in 2025, we've had a lot of moving pieces because obviously you no longer have Saxo, you've sold some of the real estate portfolio, and then again, you have some changes in your unwinding. So just trying to sort of get a sense of when we look forward, what should be a normalized run rate for the net finance results that we should be basing our sort of estimates off? Any color on that would be quite helpful. And then the second question is actually on your cost-income ratio. So fully appreciate it has been improving, but as I believe Matti pointed out, it was related a little bit to the IT costs.
I would assume those cost benefits no longer come through in 2026. As a result, should we expect the cost-income ratio to remain thereabout, or is there further improvement that we can see over there?
Thanks. Yeah. Hi, Vash. Regarding your first question on the run rate for the net finance result, it's a task impossible. But if we kinda break down the different components, obviously, we've given you very clear indication of what the structure of our investment portfolio is, plus also the ambition, how it would look towards 2028. So I think that is something that you can measure the mark-to-market yield of the credit portfolio. The fixed income portfolio is now 4.5%, and then, of course, you should assume something on the alternative part, the private equity, the private credit, and the small real estate, and equity portfolios. So with that, I think you can get to a kind of reasonable expectation on how the investment return develops.
Then on the other part, the discounting, you know, we've given you the unwinding rate, and if rates don't change, that is basically the cost of the liabilities. But as we all know, the rates are very likely to change going forward, and this, of course, means that there will be some quarterly volatility over time. But regardless of this, if we look at the overall development in the net finance result on a yearly basis and year-to-date basis, I think the moves kind of tend to smoothen out. And I said, if rates go up, it's usually bad for the investment return but good for the discounting, so...
But then you do have these kind of special items like the liquidity premium, and we fully understand that it's creating a bit of confusion, and it's not what we like either. As we've said, it comes from Moody's. But we're looking into it if we can kind of potentially do something about it in the future. But I think that's all I can kind of point out to, and if rates stay at constant level, it should be pretty constant, but unfortunately, they never do, but they tend to even out over time.
Hello, it's Petri here. Thank you for your question about the cost-income ratio and IT costs related to that and overall. Yeah, it's true that we have gained a lot of cost saving from IT side, but it's still room to go lower. For example, we are one of the first players who will get rid of the mainframe in May, and that's a really big thing for us, and after that, there's no mainframe cost anymore to us. But of course, we've still also the license cost going up every year and so on, but we still see that there's a room to be more effective in our processes, streamline our operations.
And how we have forecast this is if we can keep, and we are forecasting, keep our cost base in this—during this dry period, more or less the same than they were in 2025, which is really big thing to do. So in order to improve our cost-income ratio, I think the biggest thing will be going forward, will be the growing the earnings, and that will improve the rate. Having said that, 49% is already quite good, having in mind that we are also investing to growth, especially outside of Finland. So, there might be some room to improve, but it's—we are quite a low level sorry now, having in mind that we are growing quite fast outside of our normal territories as well.
That's very clear. Thank you so much.
The next question comes from Hans Rettedal Christiansen from Danske Bank Markets. Please go ahead.
Yes, good morning, and thanks for taking my question. Just, quickly, first, I had a follow-up question that came up, on your answer there, Petri, on the mainframe that you're getting rid of in May. Can you just quantify what sort of cost savings that will give you in 2026? That's the first one, and then I have two other questions. One is on the net flow development this quarter. Could you just explain a little bit, sort of financial effect or the nominal effect of the few larger client distributions, what exactly that is? And maybe a little bit also how we should think about the underlying development then in Q4. And then my second question is on the dividend proposal this today.
Previously, you've sort of split it out into an ordinary and an extraordinary part, whereas this year, it's sort of all coupled into one. So, is there kind of an ordinary or, and an extraordinary portion to this one? And also relating to that, maybe, Matti, if you could just explain a little bit around sort of liquidity versus capital and how we should think about it, that in terms of funding the dividend into 2026.
Yeah. Hi, Hans. If I start with the dividend-
Three questions.
Dividend, and Petri will continue with the first two ones. Well, first of all, the extraordinary discussion was basically kind of concluded at the capital market day, where we said that we have the over EUR 1 billion target, and that is kind of including everything. So we don't look at it from an ordinary, extraordinary perspective anymore. The over EUR 1 billion is the number you should be kind of focusing on. And what we also said is that it's most likely going to be a bit front-loaded, and now EUR 427 million is the proposal. If we look at the liquidity, it's a very relevant question and something that is definitely having an impact.
Around EUR 300 million was the dividend from Mandatum Life, and around EUR 35 million from the asset management company, and then we had some gains also from the Enento sale. So this basically, the proposal is almost or actually more than the internal dividends and pretty much the liquidity that we have available also leaving something for working capital. And of course, since the Saxo deal hasn't closed, this represent pretty much the liquidity we have at the moment to pay out.
Okay, thank you for your questions. About the IT cost, we don't have exact number to give you what is the benefit of that, but it's part of our budgeting, and it's substantial. So of course, at the same time, we have other license costs and so on. But all in all, our IT costs are decreasing, as we have already seen in the past two years. And this getting rid of the mainframe will help us, so we will get the full benefit of getting rid of the mainframe. And when it comes to net flow, so yeah, it's net flow in Q4. The sales was really good. It was a strong sales quarter, especially the December.
But at the same time, I guess, I would not say unfortunately, there are certain... In this business, it's good if the our customers get distribution from the private equity and private debt investments, and big ones, so they are happy customers because of that. And that happened in quarter four. And in the profit, I would say that it's no big changes. At the sales, at the same time, we got maybe even a little bit more higher margin products that we distributed out. So, let's say so that it wasn't a big thing really for us.
Got it. And just on the new fund that you announced in January of around EUR 200 million, I guess you said it was. Is that included in sort of December figures, or is that to be included in Q1 figures?
Yeah. I think you're referring to Mandatum Opportunistic Credit Fund 2. That's not-
Yeah.
In Q4 numbers, and it's not even, you can't calculate as a whole to quarter one numbers because it's called pay, so the customers pay fees once we call it, and it will come month by month, but once we call the customer's money in.
Okay, got it. Thank you very much for the, for the answers. That's all from my side.
Thank you.
The next question comes from Antti Saari from OP Markets. Please go ahead.
Well, hi, it's Antti here. Part of my questions have already been answered, but I would like to ask you that, do you believe that you're able to achieve your net inflow target of 5% of asset under management in 2026?
Thank you, Antti, for your question. We don't—as in our financial targets, we don't have net flow target anymore, neither is 5% or something else. But of course, we are doing our best, and, but of course, as you know, the bigger you get, of course, your assets under managements are growing as well. And, natural outflow in every player in the market is certain percent of your assets under management. So you have to run faster, and that's why we are hiring more salespeople, and of course, we are increasing the existing salespeople's targets for this year in order to keep the momentum, what we have seen in the past two years. So, I'm confident that we—our sales is really going well in both in Finland and outside of Finland, especially in Sweden, and, let's see.
Regarding Q4 sales, you said that it was strong, excluding these few large outflows. Was the sales... If we talk about new sales, not net sales, was the new sales in line with the strong level of Q3?
Yeah, yeah.
Okay, thanks. Then one more technical question. Your tax expense was pretty close to zero on Q4. I wonder what's behind that?
Yes, you're absolutely correct, and for the full year, the tax rate was kind of unusually low. We got some tax benefits, and we were able to utilize some previous year cash tax loss carryforwards. You shouldn't read too much into this item altogether. We're still kind of over time, it should be around 20% or the corporate tax rate in Finland. As you all know, there's a proposal that it would be lowered in 2027, but let's see. Of course, we try to kind of use all ways to kind of make sure that we pay the right taxes, but this was unusually low in the fourth quarter.
Okay, thanks. That's all from my side.
The next question comes from Ulrik Zürcher from Nordea. Please go ahead.
Yeah, thank you for taking the questions. Just ask, start with a clarification on the remittance or upstreaming. You said EUR 300 million from Mandatum Life. Has that been remitted already, or will it be?
I'm not actually sure, Ulrik. I don't know what you mean by remitted, but, but that money-
Uh.
... has been paid from the subsidiary to the holding company. So it's on the bank account as cash. So that... If that answers your question.
Yeah, it does, 'cause I'm just wondering about you report the assets in the with profit segment. So I was just wondering if there will be a drop once you paid it or if it's already paid, but-
It's already taken.
Okay.
...taken, and we usually do it toward the end of the year.
Yeah, and I, and I also think you said that, dividend was funded, that, that you haven't, you don't need to use the Saxo proceeds for this. Was that correct?
That is correct. We have not got the money and, of course, it was also, I'm pretty sure, impacted the board's boss decision. This is what we have and the proposal for 25.
But could it go higher than once you get the proceeds? Because that will likely be before the annual meeting or...
Well, I think it's. Since we haven't, the deal hasn't closed, I think it's the board has been quite clear that this is the proposal for 25, and it's not a huge issue altogether. We still believe the deal will close during the first half, but the proposal is based on the current situation.
That's clear. Then, just thinking on the general dividend level here, because you have a ROE target for 2028, and you measure ROE on average equity. So, just like a simple calculation of, like, roughly flattish earnings, it seems like this is actually a level you should maintain the two next years to reach the ROE target, or is something I'm forgetting?
Well, I think you just should keep in mind that, we have the over EUR 1 billion target and the 20% ROE target, and there's multiple ways to kind of achieve the 20% target, but it's, the, the over EUR 1 billion is the number you should be looking at. We, we don't, and we cannot guide for anything more specific, but, those two targets, will be met by 2028.
It just seems to have ROE target. It just seems like you can also go the way to just look at what your equity base would need to be, but, I guess that's-
Yeah, one component there, definitely.
Yeah. Yeah, and then also, sorry again, it's just a small... Because you had actually a very, very strong development in fee versus capitalized AUM, not only this year, but last year as well. It was like the growth rate to fee to AUM was the ratio was quite stable. But should we expect somewhat of a downtick the next years, or is... Can you sort of maintain this at, let's say, normal returns in the market?
Well, our target is the capital-light profit, growth, and that-
Yeah.
... should be over 10%, and we had 5% in last year, of course, accelerating clearly, clearly above that, on the second half of the year. So I think that's what we're aiming at and what we're targeting, and, of course, the income and the costs and fee, and AUM play a role in both of those items.
I think the last one, just technical one. It's just on the other results. I was just wondering what the run rate would be roughly on the other results once we do this Saxo Bank deleveraging or pay back that loan?
Yeah, that cost is just below EUR 10 million per annum. And then, of course, as mentioned, we had the change in actuarial assumptions, mainly due to kind of higher cost assumptions and for the next 50 years. So for a EUR 2 billion portfolio, that EUR 5 million is not a lot, but, of course, over time, that should be kind of closer to zero if we're adequate in reserving, which we believe we are. So I think those are the items there, and then you have some of the LTI costs there as well. Difficult to say how those will develop, depending on our share price development, plus then the general group overhead. So I think those are the items you should be looking, but clearly, obviously lower than what was in 25.
Yeah, yeah. Maybe EUR 20 million-EUR 25 million, or-
Probably closer to EUR 25 million, I think, is a good estimate.
Okay. Thank you so much. That's all from me.
The next question comes from Jaakko Tyrväinen from SEB. Please go ahead.
Hi, Jaakko here from SEB. Thanks for having me as well. Most of my questions have already been asked, but if I may, I would like to continue on the cost income topic and the scale of the capital light business. Is it fair to assume fairly stable cost base, underlying cost base from the levels we saw in the second half of 2025 going forward? Just to trying to understand the upcoming leverage.
Yeah. Thanks, Jaakko. It's Petri here. So, yeah, that's something you can assume. So, our budgeting and forecast is based on that our cost base will increase just a little bit going forward. And then, how we can do that is that we are streamlining our operations and processes, and at the same time, we get some room for, and quite a lot of room also, growth in sales sides and product side. And overall, we will keep our cost base quite much the same.
Good, thanks. And then, the more detailed question on the, on the AUM, development during the quarter. The international AUM was rather muted during the quarter. Was the slowness there because of the outflows, or, or was there, particularly lower inflows during the quarter? And, any further commentary on the, on the current activity level, in the international business would be nice. Thank you.
Yes, thank you. So, the first one, it was the distribution of our profits in... It was especially in our international side. So, and things we have sold in the past, and they are distributing the profits now, and but at the same time, the sales was really strong. So, that's explains why AWM remains stable, so at the same level. And other things, I would say Sweden is growing really strong, as it has already done two years and still improving. And all other places like Central Europe, we are a little bit like just investing to do i n order to grow the business.
We have seen the same inflows, what we have seen in the past, doing that from the, let's say, from Helsinki only. Now, we have put a lot of activity to our Luxembourg sales office and, and, my, my way things are that we should see some new tickets and new, new, new... Let's say, new, some kind of jump in our business in Central Europe during this year because we have a lot of activity now. But also we have to remember that we really started in September last year.
Maybe also worth commenting, Jaakko, is the fact that, as you know, our international AUM is largely tilted towards the credit market and the increase in rates during the quarter obviously meant that the market growth was lower than what could normally be assumed. So that also had an impact on the AUM.
Right. Excellent. Thank you, all from my side.
Thank you.
As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. The next question comes from Emil Immonen from DNB Carnegie. Please go ahead.
Hi, Petri and Matti. Thanks for taking my questions. I just have two more. Maybe starting with the net flow still. How do you think about the kind of money you're paying out? Would you normally consider that that returns to Mandatum as well, or, or how should we think about these flows in general?
Okay. Yeah. Thank you for your question. Petri here. So, yeah, with the large institutions, what we are here talking about is it's once you distribute some profits back from like B or BD investments, they don't immediately give it back to you. But of course, the relationship is strong, and we have worked with those customers a long period of time. So of course, we are having negotiation that at least some part of that money will come back. But that's very normal with institutions that it's not like okay, money is coming to your account, let's put it somewhere. So it's a little bit different type of investment process in those large institutions.
Okay, that's good to hear. And then on the maybe corporate side, you mentioned that personal funds was liquidated. How is that market in general developing, in your view?
It's a really strong market. There's a lot of customers' demand, and it's growing, and we are establishing a lot of new personal funds in the last year as well. A little bit less than 2024, but they were bigger ones last year than the year before. And there's, let's say, really, really big customer demand on that side. So, I'm very confident that that market will continue to grow.
Sounds good. And then a final question on, on the mainframe discussion. Maybe following up on that, is that purely an exercise in cutting IT costs, or, or does it allow you to do something else to improve the efficiency of operations in general, or do new products, or, or is this visible outside the company somehow?
Yeah, you're right, and that, that's really the big question. But yes, it's once you get rid of, let's say, more legacy thing, type of things, and you don't consume so much spending to those, it gives you room for developing new things and new software, and new products, and streamline your processes. So you can increase your IT budget, you can increase your development side, and that's basically what is happening with us.
Sounds good. That's all for me. Thank you.
There are no more questions at this time, so I hand the conference back to the speakers.
There seems to be one question about the mainframe in the chat, but I think we have covered the topic already. This concludes today's audio cast. Thank you for your good questions and for taking the time to join us today. If you have any additional questions after the call, please feel free to reach out to Investor Relations at any time. We appreciate your continued interest in Mandatum. Have a great day, and goodbye.