Ladies and gentlemen, welcome to this call on Sampo Group's third quarter 2020 results. I'm Jarmo Salonen, Head of Investor Relations at Sampo, and with me at this call I have our Group CEO and President, Torbjörn Magnusson, Group CFO, Knut Arne Alsaker, CEO of If, Morten Thorsrud, and Chief Strategist, Ricard Wennerklint. We'll have a short presentation by Torbjörn, Knut Arne, and Morten to begin with. Before handing over to Torbjörn, let me just remind you that you can follow this call on sampo.com/results, and a recorded version will later be available at the same address. With these words, I'll hand over to Torbjörn. Torbjörn, please.
Good afternoon, everyone. Sampo Group reports strong results for the third quarter of 2020. The largest profit contributor, If P&C, continued to deliver excellent underwriting combined with healthy top-line growth. It's pleasing to see the payoff from our long-term investments in web and multi-channel, and equally gratifying to see that the Nordic market is as rational as ever, implementing rate increases where necessary. The 82.4 combined ratio is also rather stronger than the first impression, as it contains more large claims than normal, a discount rate change in Finland, and working in the other direction, a 2% COVID-19 reduction in claims. The total effect of all of this is that a normalized combined ratio would be some 2% better than last year. The offer to acquire Hastings Group, that we made together with RMI in August, is proceeding according to plan.
The offer was approved by the requisite majorities of Hastings shareholders in September, and all approvals, regulatory and antitrust ones, have now been received. We look forward to welcoming Hastings to our group after the court hearing, which is expected to be held on the 13th of November. Including Hastings, as you can see from the bottom left side of this slide, P&C Insurance now makes up roughly two-thirds of the profits of the group, against only some 40% of the capital. Another measure is the high-quality earnings in the underwriting profits, which we have grown quite significantly from 2015 to 2019 and 2020, and which is now more than 40% of Sampo's net income. The numbers on this slide are not an exact science, but the idea is important to us. Topdanmark.
Topdanmark's share price fell back to levels a little below where it spent most of the summer. The company reported stable current year results, gave their usual outlook for the coming year, I am very confident they will continue to focus on underwriting profits as their main target. Turning to Nordea. Encouragingly, the company produced a solid set of numbers and increased both efficiency and market shares. The bank exceeded investor expectations on virtually all lines and remains committed to the 2022 financial targets. Everyone in the new management team is now finally in place, I'm personally very impressed already at the team's determination to increase both customer work and reduce unnecessary costs at the same time.
As is visible from the numbers, this is now four quarters of good progress, and I'm as committed as ever to contributing to the company's development as chairman of the board. Also means that it's well-positioned to pay out dividends, and Nordea intends to pay a dividend for the financial year 2019, given the necessary regulatory approvals. In addition, finally, to Nordea's dividend statement, I note that If P&C this week has decided to distribute EUR 600 million in December of this year. Topdanmark has also repeated its early commitment to paying the remainder of the 2019 dividend. Finally, Mandatum, having canceled its dividend in the spring, is now at a solvency ratio of 206, which in total gives me confidence that Sampo has no cash flow issues with a dividend in the spring and in accordance with our dividend policy.
Knut.
Thank you, Torbjörn, and good afternoon, everybody. A few words about the balance sheet as of the end of third quarter. We want to operate a prudent but disciplined capital management regime without large buffers. This means that we aim to maintain solvency and debt leverage at robust levels, with buffers above regulatory and rating agency limits that reflects our risk profile. However, we do not plan to build in large buffers beyond what we need to manage our risks, nor will we create a big war chest for M&A. What we have reported today, based on Q3 numbers, is a Solvency II coverage ratio of 214%. Which is in itself a record high level. But as we have described in our report, with respect to impact of the Hastings consolidation, this ratio will drop to 185% based on Q3 numbers, given that this transaction is closed later this month.
What we show you on this slide is a pro forma number, also including an accrued dividend at a level equal to what we paid out earlier this year as a distribution of profit for 2019. This should only be interpreted as accrual for this pro forma calculation purpose, should not be interpreted as a dividend decision for 2020. 173% is a robust level and indicates that our solvency strength is currently not a limiting factor in our ability to pay a dividend for 2020, in line with our dividend policy, which, as you know, is at least 70% of earnings. Our solvency coverage should be seen in the context of the market risk exposure we have, particularly through our ownership in Nordea. We need to maintain some prudence in our solvency ratio. Our debt leverage remains within rating agency limits but is higher than historical levels.
We have no plans to increase our gross debt nor our debt leverage from the current levels. To the contrary, we would work to bring down debt leverage on what we have today over the next couple of years. As already mentioned, our solvency strength is currently not the limiting factor in our ability to pay an attractive dividend of at least 70% of EPS this year. With a dividend from If of EUR 600, which Torbjörn also referred to a minute ago and which we announced today, Sampo's insurance operations is on a good track to deliver dividends to our holding company of at least EUR 1.5 per Sampo share, which was the dividend we paid in June.
If solvency also remains post the dividend announced today at a robust level, Mandatum's solvency has clearly improved since the company's dividend for last year was canceled. We also expect to receive a dividend from Topdanmark in the beginning of next year. In other words, we are in a position where we think that we can pay a reasonable dividend for this year, even if Nordea does not contribute. We obviously hope that it will. Paying an attractive and predictable dividend remains a key focus for us. We believe the best way to deliver this is by further improving the quality of our balance sheet and by basing our dividend on paying out at least 70% of group earnings. Group earnings which we aim to make even more predictable going forward. Over to you, Morten.
Has a combined ratio of 82.9% reported for the third quarter isolated. However, when adjusting for the effect of reduced discount rate in Finland, the third quarter combined ratio isolated would end up at a record low 78.3%. As Torbjörn already mentioned, the year-to-date combined ratio is 82.4%. Again, when adjusting for the discount rate changes in Finland, this figure would end up at 80.5%. Very strong insurance performance indeed. The profitability in If is clearly improved during the year as a result of our continuous work on pricing sophistication and risk selection. At the same time, large claims outcome is above plan level, whilst there is a net positive COVID-19 effect, which is about 2% on year-to-date and 3% is our best estimate for the third quarter isolated. We show a strong growth of 5.2% both year-to-date and for the third quarter isolated.
In a market where we did have some headwind from low new car sales and negative volume effect from reduced business activity in certain industries as a result of the ongoing COVID-19 situation. We continued to increase the number of customers and had stable retention rates throughout all segments. I think despite now being in the middle of a crisis, we really experience a record high customer activity level, in particular in the private segment during the third quarter. For instance, Nordic new car sales in the third quarter isolated was actually back at 2019 level. We saw record high used car sales levels. We also saw a peak in sale of number of boat insurances, pet insurances, risk life insurances. A very high activity level among the Nordic households.
If continue to be well-positioned as the largest P&C insurance player in the growing P&C market that is becoming more digital. The growth that we've seen year to date has been supported by a very strong performance in digital channels, and already by the third quarter, we have sold more than SEK 1 billion in new sales purely through the web shops in our private business area. The Nordic P&C market is clearly becoming more digital in this environment. Our cost ratio ended up at the record low 20.7%, and we benefit now from both a high top-line growth and continued efficiency improvements in the operations, as well as low cost spending in certain areas as a result of the COVID-19 situation.
We have revised our outlook to an 82%-84% combined ratio for the full year, reflecting a strong performance for the first nine months and a continued strong underlying earnings momentum. I thought I should give also just a quick update on the current operational situation in light of the recent development on COVID-19. During the third quarter, we started slowly to move people back to the offices, and in many geographies, we had about half of the workforce back in the office at the peak during the third quarter. However, now with the second wave setting in, we are now moving people back again more to home offices, and currently about 80% of our workforce work out of home offices. Still, customer service levels remains high also through the third quarter.
We see a high level of customer contacts, strong Net Promoter Score, and really high customer loyalty in all customer segments. As already mentioned, there is a strong shift now towards digital channels, both for insurance sales, services, where we see 15% increased logins in My Pages and online reporting of claims, where we also see a similar 15% increase in number of claims reported online. The capital market has been benign in the third quarter. We have had strong earning power, which results in a strong result and an improved solvency ratio to 176% after deducting for the planned dividend of some EUR 600 million or 6.3 billion SEK. Finally, in the third quarter, we saw some normalization of claims frequencies, this of course adds to the complexity of really separating the COVID-19 effect from underlying improvements.
Our best estimate is that we have a positive impact of about 3% in the third quarter isolated and about 2% then year to date. I hand back to Torbjörn.
Thanks, Morten. Just two final words. We have made steady progress this year, both operationally and strategically, despite the turbulent times. We plan to give a full presentation of our strategy at our next planned Capital Markets Day, to be held on the 24th of February next year. I hope that the COVID-19 situation has eased enough by then for us all to meet in person in London. Jarmo.
Thank you. Thank you all. Operator, we are now ready for the questions, please.
Ladies and gentlemen, if you have a question for the speakers, please press zero one on your telephone keypad. Our first question is from Jon Denham of Morgan Stanley. Please go ahead. Your line is now open.
Good afternoon. Thank you very much for taking my questions. Firstly, you've been quite aggressive in Industrial as peers have been pulling back. Even if I strip out the large claims being worse than expected year to date, the combined ratio in Industrial is still just above 100%. Wondering what's causing this, is it more than just simply a large loss issue? Secondly, your comments on dividends suggest that you can just about reach the 70% payout ratio entirely from insurance dividends. If the ECB review next month does result in Nordea being able to pay a dividend, how should we think about Sampo's payout ratio this year? Would it be higher than if you just had dividends for insurance entities, or would you be looking to increase the cash at the PLC level? Thanks.
Well, on the dividend issue, I think we shouldn't speculate, but rather wait for the ECB and development of COVID-19. Industrial, Morten.
It can really be attributed to large claims only. We see a good development on frequency claims. I think it's good to bear in mind that both the large claims, of course, impact industrial and also the change in discount rate is to a large extent also something that hits industrial as it typically affects workers' comp reserves in Finland. We do see a good frequency development in industrial. More the volatility that you once in a while have on the large claims side. I think it is also fair to comment that a very large proportion of the growth is actually rate increases. We see a hardening market in the industrial market, which we of course will then benefit from going forward.
Thank you.
Were - 4% in August, they were minus nine, so minus seven on average, basically this means lower margin.
If there was a question, I don't think we heard it.
Operator, can we have the last question repeated, please?
A, there's zero question on the dividend, unlike some other stocks.
Sorry, was there another question from Jon Denham?
Jon?
Jon, your line is open. Did you have another question?
No, there was nothing from me. I think it was a question from someone else on the line.
Right, okay. Thank you. Our next question is from Michael Huttner from Berenberg. Please go ahead. Your line is open.
Fantastic. Thank you very much. I had actually only one question, which is the cash payment from If. If I look at, I'm not sure my numbers are correct, 2016, EUR 586, 2017, EUR 620, 2018, EUR 675, 2019, EUR 710, and 2020, EUR 600. I'm kind of thinking, why is it down, given that we've had such an unbroken trend of rising dividends from If, and maybe you can give us a feel for what it says about how you see If or how you see group cash. I'm really puzzled by that figure. Thank you.
Thanks for the question, Michael. We don't necessarily have any target to have from one specific subsidiary, ever increasing internal dividend as such. We manage If's balance sheet on an individual basis and group liquidity on a holistic basis. I would say, though, that If's dividend is a little bit on the conservative side because we felt it made sense to leave If with a strong solvency, which is what we did, which means that we took up a little bit below 90% of last year's earnings, while we last year reduced the solvency a little bit more than reported earnings for the year before. That's the answer to the first one. On the second question, in terms of cash flow from the insurance operations, if I heard you correctly.
Obviously, If we just talked about the solvency in Mandatum is strong at the end of the third quarter with 206%. There's nothing currently that doesn't make me think that we can take up a good dividend from Mandatum as well. Also with Topdanmark's results and solvency, and of course, the fact that they only also have paid 50% of last year's dividend so far in 2020, we expect to have a good cash flow also from Topdanmark in the beginning of next year.
Just so I can understand, when you pay the dividend, so your 2021, sorry about that, your 2021 cash payable, so 2020 dividend, which pot of money is it funded out of? Should I think of the If payment you've just made plus the Mandatum and Top that is going to come in Q1? Is that how you look at it?
Well, obviously, If's dividend as such will be paid in December. Mandatum normally, which it will this year, next year as well, everything else we could pay in the beginning of the year, and so does Top.
Obviously we're hoping for a positive ECB decision before then as well.
From Nordea, yes.
I was more referring to the insurance dividends, which I understood was your question. That's right, of course, Nordea usually pays dividend the beginning of the year as well. We don't look upon it in any special way. There's no specific need in the holding company in December, which makes us take up this dividend from If at this point in time. The dividend payment from If has for some years been at the end of the year instead of the beginning of the year. There's nothing special in terms of holding company's needs this year, which means that it sort of will consume parts of the EUR 600 million for any particular purpose other than being a part of the dividend for next year.
Lovely. Super. That's very clear. Thank you.
Our next question is from Blair Stewart of Bank of America. Please go ahead. Your line is open.
Thank you very much, and good afternoon, everyone. I've got a couple of questions. Can I just clarify the pro forma solvency figure if we pro forma it for the completion of Hastings and also accruing a dividend at EUR 1.5? Was that the 173 figure that was quoted in your comments? I have some follow-up questions, but maybe just take that one first.
Thanks, Blair. Good to clarify those numbers. What we have in the report with the pro forma of Hastings is 185%. That is up 10% from what we indicated as a pro forma solvency level in Q2. Has nothing to do with Hastings. It is improvement in the solvency ratio of the rest of the Sampo group. The 173 is in addition to pro forma Hastings, we also accrue a dividend. As you know, under Solvency II, you do not accrue dividend in terms of your regulatory reporting on a quarterly basis. We have just done that for this illustrative purposes by basically accruing last year’s dividend, which is how banks report, for example, on a quarterly basis to accrue a quarterly dividend based on last year payments.
Okay, great. Thank you. The EUR 173 is pro forma for Hastings and the accrued dividend at the nine month stage.
That takes me onto the second question then. Given that you've said that you don't want to hoard capital or build war chests, should we then assume that should Sampo receive a dividend from Nordea this year or indeed next, that that would then be available for payout via a dividend to Sampo shareholders? My final question is, we're another quarter on after the initial announcement of Hastings, I just wonder, is there anything you can say that you've seen in the last quarter with regards to the performance or otherwise of the Hastings business over that period of time? Any new news? Thank you.
Let me start with Hastings. There's very little we can say other than that, of course, a pure play car insurer in the U.K., we would assume that they find life a little bit easier, for sad reasons, but still, than normal. That's that. If we speculate in Nordea being allowed to pay a dividend, that would certainly be nice. What should be done with that would, of course, depend on the exact reasons why they were able to pay it, what we expect the future to be, and what our situation is then. If I may, abstain from speculating further.
You have said that Sampo will not maintain capital over and above what you need to run the business, right?
Over time, that's correct.
Thank you.
Our next question is from Stephen Hayward of HSBC. Please go ahead. Your line is open.
Thank you very much. Good afternoon, everyone. Obviously, following up on the Solvency II own funds, aside from the EUR 1 billion debt increase, the own funds increased by an additional EUR 700 million. Can you tell me what was the big driver of that? The profit is obviously not quite at that level for the quarter. That's the first question. The second question is on your running yield of the fixed income portfolio in the If P&C business is at 1.4%. Now, can you clarify if that fixed income portfolio covers or includes the covered bonds as well? If it doesn't, can you tell me what the running yield is on the covered bonds part of your If P&C investment portfolio?
The last question from me is on your reserve releases. I'm just trying to understand that EUR 136 million for the nine months, this is a net reserve release. Is it net of the EUR 51 million change in the discount rate, or is this a completely separate item to think about? Thank you.
On the drivers of own funds, obviously profit is a part of it. In addition, reported profit. In addition to that, we had positive market value changes in our investment portfolio, which goes into the total comprehensive income. We also had a positive development in the Nordea share price, which doesn't impact neither the reported profit or the total comprehensive income, but it does impact our own funds, given the shift we did in our solvency calculation or the regulatory Solvency II calculations last year, going from a financial conglomerate to a Solvency II insurance group. Profit, market value changes in total comprehensive income, and positive share price development of Nordea is the drivers of own funds in Q3.
When it comes to the running yield, I'm not sure, there were two parts of your question, but the reason why its running yield went down in the third quarter was that the cash portion of the investment portfolio increased. The running yield is including our covered bond portfolio as such. It's a part of the reported running yield. Your third question was where you can find the cost of the reserve strengthening in Finland, that is included in the net prior year result.
Okay, thank you. Just following up on the last point there. The prior year gains you give for the third quarter of EUR 33 million, if you gross that up, remove the Finnish discount rate change, you get to a very high EUR 84 million.
Yeah.
Can you talk about where these are coming from at all?
That reserve release is mainly coming from Sweden, and as it has done also in previous quarter from releases in Swedish motor TPL. Morten, I don't know if you want to add anything to that.
It's exactly the right comment. It continues to be mainly coming from Sweden and old vintages of motor third party liability claims, bodily injury. That's correct.
Thank you very much.
Our next question is from Jan Erik Gjerland of ABG. Please go ahead. Your line is open.
Thank you. Good afternoon. I have three questions as well. The first one is related to premium growth. What kind of outlook would you think about when it comes to premium growth, not only for the remainder of the year, but also into the 2021? Earlier you have said that you calculate back the 7.5 ROE, which you require, and end up with a wanted premium for the customers. How should we read you into 2021 when it comes to growth? Would you go back to have a lower ROE and then grow your market share, or will you grab the opportunity you have in the insurance market on the Nordic to increase your ROE going forward, and by that also hiking your premiums more than claims inflation? Just thinking very loudly.
That's for Morten, but just initial remark is that, of course, say two thirds of the growth is rate increases. That's adjustments in areas where we feel it's needed, and we will always do that. That's no change, of course. Morten.
Yeah. Jan Erik, I can say a little bit about the growth. As Torbjörn already pointed out, the growth that we see year-to-date is to a fair extent fueled by price increases, so roughly two-thirds being price increases, and about one-third being more underlying growth in number of objects insured. When it comes to the outlook, of course, it's difficult really to speculate. I think it's quite uncertain times. However, what we have seen is quite a high activity level, in particular in the private segment. If you look at new car sales in a number of the countries, you see a sharp increase suddenly in the third quarter. Some countries also have reported now new car sales in October being very strong. The households' investment levels seems to be fairly high at this point in time.
Of course, that's a positive when it comes to the future outlook. On the negative side, of course, there is still a lot of uncertainty on, in particular commercial and industrial, to what extent the ongoing crisis will impact different industries and then impact on premiums income. I think it's a bit more uncertainty and a bit harder to predict really how will the growth going forward. I think when it comes to price increases, we still see that the market is disciplined. There are still some pockets where we need to see certain price increases. I think that's the comment on that.
Okay, thank you. Secondly, on your Hastings acquisition, is it so that we should implement it from after the court hearing, or is it so that you will do it from the 1st of January, or how should we think about your implementation of the Hastings into your group, and how would you do it? Will you do it like Topdanmark, or how should we look at it going forward? That will be perfect. Thank you.
Thanks, Jan Erik. That is a good question. Appreciate to be able to comment on that. We expect the closing later this month, let's say in the middle of November. Given that we still have one and a half months left of 2021, that means that we need to consolidate Hastings in 2020 as a subsidiary. You will have full consolidation of Hastings in the balance sheet as of 31st of December, and in the P&L, you will find Hastings included as a segment for one and a half months when we report the Q4 and full year result.
Okay, very clear. Just finally on the life side, you seem to have sort of taken down your risk, especially in the segregated accounts quite nicely. How should we think about the buffers going forward in these kind of high levels of guarantees post 2022? How is the buffer situation looking after 2022?
Right. The discount rate reserve in Mandatum as of the end of Q3 is around EUR 180, 70, yeah, correct me, million. That's covering the 4.5% guarantee down to 3.5% for the lifetime of the contracts, and as you say, a lower discount rate up until 2022. There's a couple of things here. One is that we're making every year, which we'll also do in Q4, an assessment of a need for increasing the discount rate further. The pace of runoff has increased further, which is positive because it means that when we come to the end of 2022, which was your specific question, we will have a little bit lower sort of portfolio liabilities that needs to be reserved for than what we previously had assessed. It is an assessment we do mainly once a year, and we'll do so in Q4 as well.
If I could just follow up on the last one, these sort of buffers, will they be taken from your mark to value reserve, or should we think about you taking them out of the P&L somewhere?
If we reserve additionally for a discount rate in reserve in Mandatum, it will be out of the P&L. It would basically be an adjustment to the reported AFS investment result. That's been the practice for some time, and we will follow that. Now, I didn't say that we will do an additional reserve, but if we do, that's how it will be accounted for.
Perfect. Thank you. That was all my questions. Thank you for your answers.
Our next question is from Michael Huttner of Berenberg. Please go ahead. Your line is open.
Thank you. It was just a quick follow-up question on kind of deals. You have these strategic or non-strategic stakes, like financial stakes. I think recently there was an announcement, I'm going to get this wrong, that Nets is merging with something. In exchange you're getting shares which are listed. There's a lockup period. I just wondered if you could give us a little bit more color on this, just to get a feel for if you should decide to sell when you would be free to do so. Is there any additional kind of things we should be thinking about in that portfolio? Thank you.
We don't comment on individual investments. It's not something, individual investment, we spend a lot of time on a daily basis. We do, as you recognize, that it looks like the Nets investment for different reasons might turn out to be a really good one, and it is an investment which as with all investments, we make sort of decisions when the time is right to sell. For Nets, that would go for all other investments in both the Sampo PLC and the insurance operations as such. There's nothing new in Sampo PLC's investment portfolio sort of to talk about at this point in time.
Brilliant. Thank you very much.
Our next question is from Phil Ross of Mediobanca. Please go ahead. Your line is open.
Hi, good afternoon. Just one point of clarification from me, please, on kind of the slide at the beginning, talking about leverage. You said you had no plans to increase debt leverage or gross debt, and you'd work to bring down leverage over time, if I heard you correctly. Can you give us any more detail on whether you have a target ratio for leverage or a sort of a timeframe in mind here, or maybe what sort of leverage levels you might be comfortable with if you don't want to stipulate a particular target? Thank you.
Yeah. Thanks. We'll plan to do a bit more update on that particular point at the Capital Markets Day in February. I think you could have as an indication that we would look to bring down the leverage to levels it were prior to us raising the subordinated debt for the Hastings acquisition over time.
Okay, thank you.
Our next question is from Stephen Hayward of HSBC. Please go ahead. Your line is open.
Thank you for taking another question from me. I noticed that you're talking about an aim to grow organically and to target organic underwriting growth. Obviously, you're trying to increase underwriting P&C business going forward on an organic basis. Can you give us some idea of how you'll be doing this, what your strategy here is? Are you focusing on customer numbers? Are you focusing on rate increases? Are you focusing on regional expansion? Not taking away too much from your forthcoming Capital Markets Day, but anything you could give on this proposal to target organic underwriting growth would be helpful.
Let me save the fascinating insights into P&C insurance details to the Capital Markets Day. Morten, feel free to add, but I want to give you a simple answer. Our target has always been, and will always be, to increase the underwriting profits. That's number one, two, three for us. We look at growth in a different way than some other companies. We look at it the way that we invest in improved customer service, not least than omni-channel web services. If that produces better customer satisfaction, more customers, we're very happy, and that's of course the target for that. The prime target is underwriting profits and will remain so.
Thank you very much.
Just to remind you, if you want to ask a question, you'll have to press zero one on your telephone keypad. There'll be a brief pause while we register any further questions. Our next question is from Jan Erik Gjerland of ABG. Please go ahead. Your line is open.
Jan Erik?
Your line is open, Jan.
Hello. Thank you for taking my questions. Sorry, I had it on mute. If I could shed some light into the market situation in the different countries, if you could do some more specification on how you see the competitive environment in each market and who you see as the main competitor currently. That will be very good to understand the P&C market further from here. Thank you.
Morten. Morten is typing. We have Morten in a different location. That has worked well until now. Let's see if we can get hold of him.
Yeah. Now, if it's better.
Yes.
I think the competition is largely unchanged. It's still mainly the three, four main players that you will find in each and every market that we compete with. It's really no big change on the total perspective in the Nordic P&C insurance landscape.
Okay. It looks like as some of the price pressures are out of the market, being forced on weak combined ratios to reprice as well, it looks like it's a good ability for you and the three, four other major players to increase your thinking and increase your pricing. How do you see these kind of smaller players and price pressures, when could they return to the marketplace, so to speak, to be more irritating competitors going forward?
It doesn't look like it's going to happen tomorrow, is it?
The market continues, I would say, to be disciplined. We do see that in the few areas where there is a need for price increases, we see that it's possible to get that through, as most players are disciplined in the Nordic P&C insurance market. I think, yeah, we've seen a bit of consolidation lately, but not to a large extent, perhaps a bit more in Norway than other countries.
So we are-
The world becomes more digital. Scale is quite important in order to afford investments needed, in order to have good customer services.
It was some time since the market was as rational or consolidated as it is now, and that is a development that is still going in that direction, not the opposite one.
Okay. Thank you for shedding some light to that.
There are no further questions at this time. Please go ahead, speakers.
Thank you, operator, and thank you all for your attention. Bye-bye.