Good evening and a very warm welcome to INDEXO Half-Year Result Webinar, where we also will talk about the transactions that we have announced over the last couple of months. I want to say especially a warm welcome to any investors who are holding the DelfinGroup shares and have decided to use this opportunity to get to know a little bit more about INDEXO. Before we go any further with our official agenda, I would also like to point out that this presentation is considered advertising for IPAS Indexo AS new share issue. This presentation is intended for informational purposes only and should not be regarded as an offer, request, or investment advice to subscribe to INDEXO shares. The approved prospectus has been published at the INDEXO website, and the approval of prospectus should not be also considered as an invitation to purchase shares.
Just study it carefully and make up your mind whether you want to participate or not. Today we will have three speakers. I will talk a little bit about pension fund results. Then we have Valdis Siksnis, who is the CEO of INDEXO Bank, talking about the bank product development. Ivita will cover some financial questions, and then I will return together with Valdis to go over some of the transactions that we are planning to do and also capital raise discussion. Without any further ado, let's move on to the first half-year results for INDEXO. Before we get there, please do submit your questions. The QR code is on your screen. You are able to get, hopefully, we'll be able to answer as many questions or answer any questions as we can.
We'll walk through the financial part quite swiftly because there is going to be a lot of information also in the publication about our results in detail. What have we achieved in the first six months of 2025? We'll start with the pension business. Our pension business is growing and is profitable. Our total assets under management have grown quite nicely over the last 12 months. Small-term fluctuations, we don't really pay that much attention to. We want to see the year-on-year growth, and that's there. Our business commission income has increased as well quite nicely by about 20%, leading to a nice strong profitable first half year. We expect that profit also to continue to the future. This slide we like to use to illustrate basically what are the growth drivers of our pension business.
Our business or assets under management, from which we get revenue growth through the monthly contributions of our clients, both in second and third pillar. Then we also get inflows from clients that bring in over their assets that they are managing with any other manager. We unfortunately still see some outflows of clients who, for one or another reason, choose another manager. Then positively, hopefully, not always, but positively should impact also over long term the market returns that the money that we already manage generates for us. This I think gives a kind of very clear picture how our business grows. We are extremely closely paying attention both to monthly contributions and also that the churn, monthly contributions, because this is like the really sticky part of our customer base that likes us and uses us to save for the retirement.
Churn, we pay attention from a point of view that firstly we obviously want to hold back every customer from going away from us because we have excellent, excellent product. That is for us an indicator about what kind of investment we are making into marketing and client acquisition. From the sort of overall market point of view, INDEXO is a, has the best class of clients in second pillar. Our clients have the largest assets under management compared to the competition. This is predominantly driven by the fact that we have been much better performing pension fund manager or our fund has been a better performing option for saving than most of our competition.
We are very happy to say that we have also beaten the inflation over this measurable period of time, which means that our savers actually see the real wealth growth and see their retirement savings increasing in real terms. When we talk about INDEXO business, then we have the pension business is, as I said, profitable. It is a very sort of a simple from a point of view that the administrative expenses that we use to run the fund management company are quite stable. There is a certain, let's say, fluctuation in the expenses due to the fact that we are also a group enterprise, like we consolidate group activities, which means that we have one-off charges related to different transactions, capital raises, and so on and so forth.
Really, the most important part is that even after our market expenses, we are a profitable company, which means that we can invest into our bank development project. We are stable and also a high return on equity generating business line. For the first half of the year, our net profit from the pension sides was almost EUR 750,000, and we see it pretty stable going forward. Now I'd like to hand over the word to Valdis, who is our INDEXO Bank CEO and who will obviously cover the most exciting part of our business right now, which is the bank development. There you go.
Yeah. Thank you. Thank you, Henrik. Indeed, the bank soon will have one year anniversary. Some people say it's already one year, and some people say it's just one year. I'm more in the second camp because for a so serious project as a bank, one year is not a very long time. Nevertheless, we have some achievements and also some challenges already. The main achievement or, for any business or main goal, for any business is to attract customers. I believe we are doing quite well. We are coping with this task quite well. As of today, we already have more than 40,000 customers. At the end of the reporting period, it was 39,900. The customer inflow, of course, was much higher. It was high, very high in the beginning, but it continues steadily from month to month. We believe this growth is going to continue.
The second task, of course, is to not only attract the customers, but to make sure that those customers are using your services. There we have some successes, but we also have some challenges. We believe and we aim for bigger wallet shares from those 40,000 customers and for more active usage on average of our services, and especially also more, keeping more money with us. We would like to see a faster deposit volume growth. When it comes to the loans, which is today our main revenue driver, there we started quite slow. At the beginning of this year, we had a portfolio only of EUR 1 million of consumer loans. During the first six months of this year, we have grown our consumer lending portfolio quite rapidly. In June, July, we also added mortgage loans.
That's why you see a big jump, specifically in July, when we grew our portfolio by 50% just in one month. I'll explain later why we believe we can keep the high growth going forward. I'm also proud that we have been quite successful at eliminating our deficiencies and introducing some product improvements. The main complaints since the launch were about Apple Pay and Google Pay. Now all our customers can use this option to pay with their payment cards issued by INDEXO Bank. Mortgage is a super important product, and that was launched. Mortgage refinancing was launched at the end of May. We are constantly improving consumer loan offer. There are also a number of smaller features, smaller improvements, which we are delivering on a monthly basis.
As of today, I dare to say that actually we are offering already all most important retail banking services needed by the average retail customer. On top of that, a very important product, which is not exactly a retail banking product, is a custody bank service. We just received the regulatory approval, and we informed the market about that today. That opens the doors for us to provide the custody bank service first to our pension management company, with their EUR 1.4 billion and growing assets under management. We are not, of course, limited only to that. We will be able, when this service will be introduced, to offer it also to other asset managers who need such service. Going back to lending, the consumer loan portfolio has been growing steadily, and we managed to accelerate it even more in July.
We believe that further improvements can be expected because we are constantly tuning and improving both the product features, underwriting rules, and sales process as well. July was our record month, but we hope and we believe that this record will not hold very long. Hopefully, each next month will be a new record. Of course, when you talk about the retail banking, you can't avoid speaking about the mortgage loans. We launched refinancing of mortgage loans at the end of May. Refinancing nowadays in Latvia is not a complicated process. It's a standard type process, but it's not a very fast process. It just takes certain steps, and then there are waiting periods in between. That's why from the initial offer to disbursement of the mortgage loan, it normally takes several weeks. In some cases, it might take more than a month.
That's why, even if you launched in May, we started to see bigger volume of mortgage loan disbursements only in July. It is going to continue going forward. I'm also proud that our mortgage loan product, refinancing product, is fully digitalized, fully automated, and customers just in a few minutes can get already very well checked refinancing offer. Even without huge promotion, it has been quite popular. We've made offers worth almost EUR 90 million already. Of course, not all of that will result in disbursed or refinanced mortgages at INDEXO Bank. Nevertheless, most of those people will improve or will lower their interest payments either by refinancing to us or, in worst case for us, using our offer to, so to say, scare their existing bank.
Nevertheless, we still have, at the moment, EUR 45 million worth of deals, which are mortgage refinancing volumes, which are in different stages of that process. Once more, to emphasize the importance of lending, that is, in a given circumstance when the ECB rates have dropped. That's our main revenue source. That's our way to reach profitability, to reach break-even point. You can see that growing lending volumes helps to achieve that goal. If we're looking at net interest margin, then it's going up month from month. By the end of the year, it should be close to 3% and over 4%, over 400 basis points, already next year. Now I will invite our CFO, Ivita Asare, to tell more about the results.
Thank you, Valdis. As Valdis mentioned, lending is a driver for our income growth. Especially now during quarter two, thanks to the nice increase in the consumer lending portfolio, we have managed to get to the second quarter net interest income, over EUR 200,000, which for us in our first year is quite a big achievement as it has been more than 200% higher than in our first quarter. However, I should also add that net interest income was increased also because we were decreasing interest expense on our deposits, following the ECB interest rate cuts. That also helped to increase the net interest income. We expect as our loan portfolio will grow, for the future quarters, the increase will be even higher. However, as you can see from our P&L, we have some challenges on the net commission income side.
It still has been negative in the second quarter as well. We have been observing lower activity from our customers as we have been planning. There has been lower activity in the usage of the different banks' products. Our deposit volume growth has been slowing down, comparing to the first six months of operations. This resulted, still, that our net commission income is negative. To the largest extent, partly this is because we are not able yet to cover the fixed costs related to card processing. Going forward, our focus will remain on increasing this customer activity, as already Valdis mentioned. We wanted the customers to start to use even more our bank and also bring over the larger share of their wealth. Regarding expenses, in the second quarter, we have seen a 12% increase in our total costs.
Our total costs in the second quarter have been at EUR 2.5 million. As Valdis mentioned, we have been delivering quite nicely on our product developments that we have been promising. That has required that our IT investments in the second quarter were almost on the same level as in the first quarter. The main driver for the increase in the cost in the second quarter has been related to some new employees that we needed to recruit, mostly to service our customers together with the launch of the new product. Probably some of you have noticed our bigger marketing campaign during the second quarter where we were also informing all of you about our new product additions and about the nice terms that we offered during this initial period. Of course, the increase in the loan portfolio comes together with the increase in the credit losses.
In the second quarter, expected credit losses were at around EUR 340,000, and the total for six months has been more than EUR 600,000. We see that our quality of the portfolio has been very good, and the cost of risk approximately is at 5.8% for the first six months. Our total net loss for the second quarter has been at EUR 2.6 million, and the total loss for the first six months has been at EUR 5.05 million. Going forward, increasing profitability will continue to be our main focus, especially through driving the income growth. If we come to our balance sheet, we can see that we have managed to exceed the EUR 50 million at the end of June. We have managed to do this by a EUR 5.6 million increase in our loan portfolio, which has been mostly because of the consumer loans.
As you saw previously, our mortgage loan portfolio at the end of June was still very small since we just started the product. Deposit growth has been EUR 2.4 million. Going forward, with these ambitious plans on the lending side, we will see also increases in our deposits. Since we started the bank, we have been making very large investments both in our IT infrastructure and also product development. Our intangible assets at the end of June stand at EUR 5.4 million, which is around EUR 400,000 increase since the beginning of March. Now we can say that we are quite comfortable that the infrastructure that we have built is at the moment enough to continue to increase the lending portfolio and the number of customers. That's why we expect that our operational costs are pretty stable as we have also actually seen it for the past three quarters.
Going forward, the main profitability driver will be increasing the income side, as already several times has been mentioned through the lending portfolio growth. Obviously, all that, the lending growth and also the fact that we are still having net losses requires our capital to be constantly strengthened. During the second quarter, our mother company, IPAS Indexo , has invested into the bank, €3 million. We are going to need strengthening the capital going forward as we have been communicating this also already before. Now in August, we are having the IPAS Indexo share issue. We are also considering other capital strengthening instruments, for example, issuing subordinated debt on the bank side. Now I will give a word to Henrik Karmo to talk about potential transactions in our pipeline.
Thank you, Ivita. Let's go over those plans that we have announced. First of all, I want to say that both of these transactions that we are talking about are still in the regulatory approval phase. These are plans. They are not yet materialized. In the case of VIRO, we have a signed agreement with the VIRO shareholders about acquiring the shares. It is actually in the regulatory approval process right now. The transaction itself is quite simple. We are acquiring another pension fund manager, which has over EUR 80 million assets under management, over 10,000+ customers. For us, it's quite a logical step in the same way as we acquire customers from the market. In a similar way, we had an opportunity to make an offer for a company that has basically grown quite well over the last couple of years.
Our settlement for the purchase price will be done both in cash and in shares. It basically means that at the end of the day, the VIRO shareholders will also become INDEXO shareholders. As mentioned, for us, it allows us to increase our scale. It provides additional income to our pension fund manager. Because of the nature of the fee regulation, also meaning that when our assets grow, our fees going forward will go slightly down. For VIRO clients, actually, this is excellent news because they will actually get lower fees than their present fees from the manager. Also, our product, looking back historically, has performed better than their fund management product. For them, it's great news.
For us, it's also great news because the other thing which Valdis mentioned about our bank soon being able to provide custody bank services to our fund manager, then with higher fund management volumes, it means also that our bank will benefit from higher fees from custody bank services. We are in the regulatory approval process. Hopefully, this is something that we will be able to close quite soon. Second, I think a larger sort of a strategic opportunity and, let's say, move that we have made here at IPAS Indexo AS is announcing that we intend to make a voluntary offer for DelfinGroup shares, with an intent to get over 50% of shares, allowing us to, in the future, again, getting all the regulatory approvals and competition board approvals, and that the offer being picked up by DelfinGroup shareholders would allow us to consolidate DelfinGroup into INDEXO Group.
Basically, we have announced an offer whereby we are ready to purchase DelfinGroup shares, either by allowing them to convert their shares into INDEXO shares according to the share swap ratio that has been published. The other option that the DelfinGroup shareholders have today is to take a cash offer from INDEXO whereby we would offer EUR 1.3 per DelfinGroup share. Again, this is our intention. The actual materials about the DelfinGroup offer, prospectus, and also what the joint group will look like when we are actually, if we are integrating DelfinGroup, consolidating it into our group, will come slightly later, closer to the end of August, hopefully. Why did we decide to do that? We sort of appeal that, first of all, DelfinGroup as a standalone entity is a great company. They are financially well managed, having a good return on equity.
They are profitable, growing, and at the current sort of evaluation, I think it's a great investment for INDEXO. Secondly, there is a commitment that DelfinGroup has given to the shareholders, which is that they pay out 50% of the profits on a quarterly basis to their shareholders. That, as a financial group that still uses or needs capital to grow our banking business, is obviously a very welcome additional capital stream. According to our really, let's say, the basic calculations based on publicly available information about DelfinGroup profit forecasts, we assume that would actually allow us to lend EUR 100 million-EUR 200 million more, which obviously then would help quite significantly our profitability. That EUR 100 million- EUR 200 million sort of seems like a wide range, but it really depends on the products that we will lend.
Obviously, the consolidated picture, if we get control over DelfinGroup, means that we will be, as a group, profitable much faster. That profitability then potentially is even further enhanced by all sorts of synergies with DelfinGroup that we will drill into in our further disclosures that we will do closer to the end of August. Some of those things are pretty obvious. You understand that DelfinGroup has a large customer base, so there are cross-selling opportunities. Their customer base is, I think, somewhere around 330,000 clients or database that they have been in interactions. There are also other types of business opportunities. Definitely, as somebody who is growing a lending business and then being in the lending business for 18 years, there is also much to learn and things that we can take over from them from a point of view of operational efficiencies.
I think also very importantly for the shareholders of INDEXO, the combined group would actually be with a bigger market capitalization, higher number of shareholders, and hopefully that would also lead to better liquidity, bigger depth in the market. That would allow us to provide better exit opportunities for those who want to sell and better buying opportunities for those who want to buy. I think what is also important to understand from this dividend flow point of view and important for the market is that with that dividend flow, we are actually decreasing also the reliance on the market for getting fresh capital in. Hopefully, that will also then reflect in the number of shares that we need to issue to the market competing for basically client, investor, and money. Hopefully, that will have a longer-term positive effect on our share price.
For the DelfinGroup shareholders, they don't have to decide absolutely anything today. The offer will become public in real terms only after the preliminary, after the regulatory approvals. What we are putting on the table here is basically three options. First is to exchange DelfinGroup shares to INDEXO shares and then participate in the growth story of the consolidated company. Second one is to remain a DelfinGroup shareholder. Basically, we are intending to run this business, if we can get control, on an arm's length basis. The dividends flow will continue. We as a group are interested in receiving those dividends, and hopefully some of those synergies I was talking about will also enhance the business of DelfinGroup, thus increasing the value to the shareholders.
The third option is to apply for cash, which we have priced at EUR 1.3 per share, and that offer we will probably limit to a certain extent. To give you an indicative timeline for this DelfinGroup acquisition, firstly, we need to call for a shareholder meeting. If we intend to put in that call in the early days of next week, that means we should have the shareholder meeting by somewhere around the second of September. That would then clear from INDEXO side the path to make that offer. In parallel, we would be submitting documents and having negotiations and discussions with the Bank of Latvia and Competition Council.
Hopefully, at the beginning of September, we would be able to start the buyout offer, which would be a limited time, so that by the beginning of October, we would be able to end the buyout offer and settle somewhere by mid-October. Again, this is a plan. Obviously, us being in a regulatory business, we know that not everything is under our control, but we are very keen to make it happen as fast as possible. Further, I would give a word back to Valdis, who will say a little bit about the current capital raise that we are doing, which is a sort of an interim plan for us. In a sense, this really now focuses on bank only, without any of the DelfinGroup and VIRO plans that we have discussed before. Valdis?
Thank you, Henrik. Yeah, indeed. We have communicated also before the need for more capital, a need for more capital also before we close those two significant transactions. The bank naturally needs capital to comply with all the regulatory requirements. The more we lend, the higher capital requirements we have. That is one reason why we will need more capital. Of course, we need more money, also funds to invest in new product development. Until we reach the break-even point, we also need to finance our losses. Reaching break-even point, that's why it's super important to reach it as soon as possible, not to waste capital on covering our losses. Talking once more about the DelfinGroup transaction acquisition, I think Henrik very well explained to you all the benefits. I just want to highlight it once more. It will allow us to lend more.
It is a fast track to profitability. We reduce reliance on external capital raises, and there are lots of synergies of all kinds. Also, selling or offering our pension management and bank products to hundreds of thousands, 300,000, DelfinGroup customers. As mentioned before, we will provide a detailed projection with all the benefits at the moment when we will officially make a voluntary transfer. Right now, we are basing our projections on INDEXO Group as it is. The DelfinGroup transaction, as mentioned, would help us. Even without that, we must become profitable and reach the break-even point as soon as possible. There we have our challenges. As mentioned before, the customer activity and growing the volatility we are getting from our customers we onboard has been some challenge. At the same time, it's also potential. We will need to, and we are paying already, more attention to that.
Growing lending volumes will need to also get the deposit volumes up and attract more deposits. We also have to be very mindful about our costs and keep all costs under control. One of the largest items is our IT investments, both for new product development and maintenance. At least temporarily, we are pushing those costs down and reassessing product development priorities in order to gradually, afterwards, in a very disciplined way, grow them if that will be necessary. I mentioned several times break-even point. Break-even point, before, we indicated that we are likely to reach it by the end of this year. Fortunately, we have to adjust this projection and say that we are going to reach it in the beginning of next year. Nevertheless, our long-term goal for INDEXO Group as it is now, without the benefits of the DG transaction, remains unchanged.
With the DG transaction, they are likely to be significantly better or significantly more attractive. The way to reach the break-even point is to grow revenues and grow net interest income, and that is through lending. To reach that, we have estimated that we need a portfolio of EUR 80 million- EUR 85 million. Luckily, the trends of the last couple of months show that we are on track to achieve it within the indicated time frame. About the public offering, it starts tomorrow and it ends after lunchtime next Friday, 15th of August. We are offering 345,000 shares at a price of EUR 10.15 per share, and anybody, everybody can participate. The minimum investment is just EUR 10.15 because you can subscribe for already one share. Why is the share price EUR 10.15?
That is management's understanding that we can successfully raise capital at that price, and that price was used also to structure, calculate the DelfinGroup transaction. Even more important argument is that we have a buyer for the whole emission at that price, and that is Alpes Capital. Of course, it does not give allocation privileges to Alpes, but if there are no other buyers, then Alpes is prepared to buy everything. I'm sure we'll have more buyers, and it makes very much sense for new and at least existing shareholders to subscribe and to obtain the privilege of pro rata allocation. Of course, there are several advantages of being our shareholder. You join us in our journey towards building this successful, strong financial services group, and you become the voting member and you can have an impact on our direction.
Of course, it depends how many shares you buy, but there are many, many benefits to join. Also, for shareholders which will hold 200 or more shares, there will be an extra benefit if they are interested to refinance or later take a new mortgage loan from INDEXO Bank. Once again, I can encourage everybody not to miss the opportunity and to participate in our subscription as it will be. We know already as of today it will be oversubscribed. Don't miss the opportunity to get your share out of it. Doing that is quite simple for those who haven't invested in shares before. We have provided instructions how to open a securities account and how later, also tomorrow, there will be detailed descriptions how to subscribe to our share issue.
One comment though, one mistake which some investors did previous time is that during the subscription period, there are two types. There will be a temporary issuing for a new share issue. Don't mix it up. Otherwise, you make an offer in a secondary market, which will work parallel to the new subscription. Be careful when you're subscribing that you are putting in the right type of offer. That is all what we wanted to tell you today, what we have prepared. Once again, QR code to submit your questions. I give floor back to Henrik for Q&A session.
Thank you very much, Valdis, for talking through about the bank capital plans. We have a few questions online. Artūrs, our dear colleague, will post them and ask them. Shoot away.
All right. I'll start with the most popular ones, then let's go down in popularity from that. The first one I want to, I know, but an anonymous user wants to ask is, Latvians are quite conservative with B3, pillar three, or similar products, regular savings. Are you planning anything to improve and shake this up?
Yeah, absolutely. I think there is, first of all, I think it's a little bit of a misconception that Latvians are not interested in investing or saving. If we look at even the voluntary pension plan volumes compared to Estonia or Lithuania, it's actually, the overall picture is not that bad. I think what we see and what we tackled when we entered the market in the second pillar is that maybe people are slightly too conservatively allocated and maybe in the products that cost more than they should. In that sense, we have already brought in good prices, an excellent product that can show, as we have shown in our pension management slides, that grows above the CPI and really kind of grows our savers' value. We have brought that to the market.
An extra benefit that we actually offer, which nobody else does in the Baltics, is that we have individual life cycle possibilities. A person can actually rely on the age-based life cycle allocation without having to think about it. As they reach closer to the retirement age, we automatically reduce their risks, and they can set the parameters themselves as well. We are definitely talking to many more people in the voluntary pension part because we really see that our aim is not to see it as a product-based market, but more that we need to help people to reach a meaningful retirement savings level. Those different products that we're offering are just part of the journey and they should be combined and so forth. Hopefully, we will announce also soon other ideas that we have for helping our customers to save more.
All right. Moving on, how large is the potential custody market we are aiming to take?
It's a little bit tricky to say because, obviously, like, let's say if we look at the sort of total pension savings market in Latvia, which is about $10 billion, then there are some alternative fund managers as well, which we could address, holding the custody or providing custody service from the bank side. I mean, we know for a fact that we will take over, regulatory approval permitting, our custody from INDEXO pension funds. The rest of the large players are all attached to their own banking institution. I don't think there is going to be huge wins that are easily achievable. There are a few other independent asset managers that we can work with. I also believe that the fund management market overall is growing beyond the only second and third pillar products.
There we have definitely an addressable market, both in real estate funds or alternative investment funds investing in forestry or wherever. I wouldn't really give a very clear indication of what sort of revenue we'll be creating in 12 months' time from that. We will be actively pursuing that and bringing in welcome competition for everybody, which hopefully will lead to better pricing.
Why did we decide to acquire VIRO?
To be honest with you, because the offer price at which we could acquire those customers was right. I mean, we are quite rational here at INDEXO in terms of what we invest in our client acquisition. If somebody offers you to acquire bulk customers with existing business, then I think we have, over the last seven years, trained our math pretty well to understand when it's valuable and when it's not. Clearly, we have benefits both in terms of increased revenue. We actually will get all of our also INDEXO customers will get a better pricing because of the increased volume. It will also drive our revenues on the bank side by increasing the custody service need that we have.
All right. Thanks. If other pension managers have lower fees, why should someone stay with us?
I think, like with any sort of product, fees is not the only, it's a very important part of consideration when a person makes a choice, but it's not the only parameter which people should look at. I think overall, in this industry, there is a lot of fuzziness about the terminology, right? We have, in the Latvian market, there are index funds which market themselves as index funds, but which are following some totally different indexes, and so the performance is worse. We have asset managers that do active management, which is maybe not really that helpful. I think for those customers who have been sticking by with INDEXO from the time when we launched, what we can show is that we have been one of the top performers historically in the market. We really give our customers back the fair share of those market returns.
Most importantly, we have brought competition back into the market. I think everybody benefits, which is great. We are constantly driving up the standards in terms of transparency. Also, our fees and the cost which the customer is incurring have come down every year. We are also quite good at sharing those benefits that we get from scale with our customers.
What is the next big product addition to the bank's product offering?
Actually, it might, Valdis. I think, like, you know, banking is your kind of a love affair.
Okay. Yeah. Thank you. Of course, I mentioned that short term, our priority is everything lending related. That would be equity release, mortgage product. That would be some improvements with consumer lending. Later also, new mortgages, issuing new mortgages. We're piloting all those products already, but there is still some work to be done to package them nicely with a good user experience to do a mass launch and make it commercially available and scalable. Of course, attracting deposits will be also very, very important. As we've discussed before, the feedback we are receiving from our customers who are relatively young and have children, they want to have a children account. That is development we have started to work on.
I mean, we usually receive, or often receive also a question about SMEs, but that is likely to come after we deliver and we reach the break-even point for our retail business. Maybe there are some other bank-related questions.
After you. Yes. The next one is, when will new mortgage loans be issued?
We don't have a specific deadline or specific date yet. As I said, we are piloting, and some of that type of loans are being tested right now. The first addition will be equity release product and then new mortgages.
What is the average interest rate that INDEXO offers for mortgage refinancing?
I think we can be, of course, capital is a deficit source for us. We are very capital cautious, and we are the most, let's say, competitive when it comes to the low capital consuming deals. Those would be low loan-to-value transactions, and those are likely loans which have been issued three, four, five, ten years back, have been paid down, so LTV is very attractive. Of course, customer credit worseness has been tested also this way. Actually, at that time, the interest rates or margins were notably higher than they are today in the market. We can make a very competitive offer for those customers, but the margins differ, both for the risk profile of the customer and loan-to-value ratio, the collateral coverage.
How do you feel about the bank's results? Are you proud of what you have achieved?
No, I think we tried to give a fair assessment. Yes, we have some positive things to tell. I think the 40,000 customers, for instance, is less than one year. It is quite an outstanding achievement for any retail business, and that's a huge asset for us. We are also proud of the things in the last two, three months we are achieving in the lending market. We have also our challenges. You know, for any business to be sustainable, successful, and to deliver to its shareholders, customers, and community, that business has to be able to feed itself. That is reaching break-even point, which, I have to admit, has taken us somewhat longer than we anticipated ourselves and indicated to investors. Of course, there have been some external factors like lowering interest rates, ECB rates, which didn't help. We have a solution lending. We must deliver now.
Currently, we have only one question remaining. This one is, aren't you afraid that cooperation with DelfinGroup could damage your reputation and reduce client willingness to work with you?
I think I'm sincerely, I am very enthusiastic and very excited about this transaction. I think the DelfinGroup transaction will be really a turbo engine or big jump for a bank development. With the dividend flow and with the synergies, we can do so much more for our customers and deliver so much better results for our shareholders that this is actually a no-brainer for me that we should go that way. Do we see any negative reactions? Of course, there are always, whatever you say, whatever you do, there are always some people having some opinions, and there's always somebody who disagrees with that. I can't say that we are observing any significant protest or reaction. I think both customers and shareholders see the positive side of this.
Thank you. Currently, there are no other outstanding questions. Maybe let's give 10 seconds if someone has something they want to write still. If not, then thank you for joining. Valdis, maybe you have something you want to just end this session on.
Thank you for your interest, of course. Thank you everybody who is already our or DelfinGroup shareholder. We just invite you to participate once again in our new share issue or to join us as a customer.