Bankinter Aktie

Good morning, and welcome to Bankinter's First Quarter 2026 Results Presentation. Financial statements were posted with market authorities earlier this morning, and all materials can be found on our corporate website. Please refer to the disclaimer in the presentation and note that this call is being recorded.

Today, we welcome our Chief Executive Officer, Gloria Ortiz; and our Chief Financial Officer, Jacobo Diaz. Gloria, over to you.

Thank you, Laurie. Let me start with the key highlights for the quarter, which confirm the strength of our business model, disciplined volume growth, continued margin improvement, a diversified and resilient income base and best-in-class efficiency and risk metrics. In volatile markets and in an environment of geopolitical uncertainty, that combination is not a nice to have. It is what protects earnings power through the cycle.

This quarter, we delivered it once again with growth that is both profitable and controlled, supported by high-quality balance sheet. First, customer volumes increased by 6.5% with customer lending up 5%, retail funds up 1% and assets under management growing by 17%. This is balanced growth. We are growing where we see attractive risk-adjusted returns, and we are doing so without compromising the quality of the franchise.

Second, on margins, we continue to demonstrate strong pricing discipline with customer margins at 2.68% and NIM at 1.76%. In other words, we are not buying growth. We are growing selectively with strict pricing discipline. Third, our income sources are increasingly more diversified and resilient. Net interest income grew by 5.5% and net fees by 8%, driving gross operating income growth of 6.5%.

Finally, operational excellence and balance sheet strength remain key defining features of Bankinter. We continue to improve our management ratios with the cost-to-income ratio declining towards 35%, NPL ratio below 2% and strong capital levels. All of this translates into profitability and value creation. Net profit reached EUR 291 million, up 7.6% with RoTE at 20%.

Let's now go into some detail behind these figures. Customer volumes grew across the franchise, increasing by EUR 14 billion year-on-year. Growth was led by lending and assets under management with deposits stable and improving in mix. Geographically, Spain remains the core growth engine, while Portugal and Ireland continue to add faster momentum off a smaller base.

On Page 7, you can see the quality of our core revenue growth. 1/3 of core revenue growth comes from fees, which now represent 26% of core revenues, a clear signal of higher-value client base and a more diversified business model. This is not cyclical growth. It reflects structurally more diversified core revenues and margin management that sustains net interest income even in shifting rate environments.

Page 8, key management ratios reinforce the quality of execution behind our results. Improving efficiency, strong asset quality and strengthening capital all confirm that growth is disciplined, risk is tightly controlled and profitability is sustainable through the cycle.

Let me now turn to milestones for the first half of the year -- first part of the year. Portugal is a clear success story for Bankinter. Since launching in 2016, we have delivered high-quality growth, doubling our client base, tripling business volumes and transforming efficiency from over 120% to the low 30s.

Profitability has scaled strongly on the back of a disciplined and diversified model built on a fully integrated operating platform with strong internal capabilities, reinforced by joint ventures and strategic alliances with partners such as Mapfre, Sonae and Generale. None of this would have been possible without the team.

So today, Bankinter Portugal has 884 employees, around 70% of whom have been with us since 2016, complemented by more than 150 new recruits from a younger generation who will help fuel the next phase of growth. Together, they underpin a genuinely scalable and sustainable model supported by digital transformation, applied AI and a clear focus on value creation.

On Page 10, earlier this month, we announced 2 complementary and clearly strategic corporate transactions to scale our business in alternative investments. First, we merged our alternative investment fund manager with premium partners to strengthen leadership in direct alternative investments, expand sector expertise and reinforce capabilities. As a second step, we will take a significant economic stake in Access Capital Partners, accelerating our Pan-European expansion through scale, specialization and greater product breadth across investment strategies and geographies.

Together, these 2 transactions directly enhance our value proposition while broadening access to alternative products where we already distribute today to more than 15,000 private banking and retail clients across Iberia. Overall, the strategic decision strengthen a high-value capital-light recurring fee franchise, deepening long-term client relationships.

And having just reviewed 10 years of growth, delivery and profitable success in Portugal, I have the strong convictions that Bankinter investment is on the same path, building scalable long-term growth and delivering strong value creation for our shareholders.

And before handing over to Jacobo, let me briefly frame my view of the current environment. While geopolitical uncertainty has increased in recent weeks, our assessment remains that this will not, in the near term, translate into a contraction in consumption in our core markets. What we are seeing is greater prudence rather than a deterioration in underlying demand supported by solid private sector fundamentals.

In this context, our geographic diversification across Spain, Portugal and Ireland continues to provide stability and quality to our earnings profile. And these markets are expected also to be less impacted and to perform better than the European average.

So this is all from my part, and it is now over to you, Jacobo. Thank you.

Thank you very much, Gloria, and good morning, everyone. Let me briefly summarize the income statement.

Net profit reached EUR 291 million, up 4% quarter-on-quarter and 8% year-on-year, driven by resilient net interest income, solid fees, disciplined cost control and lower provisions. I'll now walk through the key drivers behind each of these lines in more detail on the following pages.

Net interest income continues to progress well. NII reached EUR 571 million in the quarter, up 5.5% year-on-year and around 2% quarter-on-quarter on an adjusted day count basis. This is driven by volume growth and improving customer margins and special due to the improvement in deposit cost, which declined by 6 basis points during the quarter, supported by better deposit pricing and mix. On Page 14, let me take a minute to talk about our deposit strategy. Our approach to deposit growth remains disciplined and margin focused. We are actively managing the mix toward higher quality, more stable retail funds while maintaining tight pricing discipline. This focus has meant prioritizing the management of the cost of our deposit base rather than maximizing volumes.

During the quarter, we continued to optimize pricing, including actions on digital accounts and a review of deposit spreads for treasury and fixed term deposits. Retail funds declined by EUR 3 million due to a -- EUR 3 billion due to a seasonally softer first quarter as well as active margin management actions.

We continue to optimize our funding mix with a lower share of price-sensitive term deposits and a greater share of current accounts supported by our digital strategy. This translates into lower deposit beta, lower funding costs and improved margin resilience through the cycle. Consequently, average retail deposit cost for the quarter continued to decline, reaching 81 basis points.

At the same time, digital accounts continue to perform very strongly, increasing by almost EUR 2 billion during the quarter to over EUR 13 billion. This clearly demonstrates that our campaigns remain effective and customer engagement is strong even after the price reductions implemented on digital accounts during this quarter. This is fully consistent with the year-on-year trend shown on the slide, a structurally healthier and more stable retail funding mix with growth in current accounts and a continued reduction in term deposits.

On Page 15, turning to fees. This grew 8% year-on-year to EUR 203 million, driven by wealth management activity as well as a strong growth in insurance activity. Q4 '25 included some one-off items, so sequential comparability is not fully like-for-like. Our underlying mix is increasingly value-added and recurring, strengthening revenue resilience.

On Page 16, on other operating income and expenses, this also shows solid growth. Equity method, trading and dividend income increased by a combined 18% year-on-year, reflecting the continued diversification of revenues from business such as Bankinter investment, our insurance joint ventures as well as with our partnership with Sonae in Portugal through Universo. Overall, this further reinforces the quality, diversification and resilience of our earnings base.

On expenses, Bankinter is well known for its best-in-class efficiency levels, and we want to underline that the improvement we are delivering today is structural, recurring and still has room to improve. Business growth continues to be absorbed without creating structural pressure on the cost base. At the same time, efficiency is not being achieved by underinvesting. We continue to invest in people and technology with applied AI and simplification initiatives already delivering tangible productivity gains. This allow us to grow, invest and keep improving profitability at the same time.

And that leads directly to the next slide, which shows how we are maximizing the potential of AI. Our approach is very pragmatic and built on a dual framework. On the one hand, we have toned down CEO-driven priorities, applying AI across software development, commercial process and day-to-day operations. On the other hand, we are pursuing a bottom-up approach, equipping our employees with an increasingly accessible AI tool set embedded in their daily workflows.

Together, this supports higher productivity per employee in front and back offices and a lower cost to serve as volumes grow. In short, AI is not a future promise. It is already reinforcing cost efficiency and strengthening the scalability of our operating model and will continue to be a key driver of efficiency improvements in the coming years.

Next page on credit costs remains low and well controlled at 32 basis points in the quarter. Other provisions also performing well, down to 7 basis points. Profit before and after tax grew by 8% year-on-year with net profit at EUR 291 million, confirming the resilience of our profitability and our ability to create value through the cycle.

Asset quality remains strong and clearly differentiated. NPLs are low, coverage is prudent, and we continue to outperform the sector across all geographies with risk metrics stable, well controlled and with no signs of deterioration.

On Page 22, CET1 ratio closed at 12.96%, above our target range and well above minimum requirements. Strong earnings generation comfortably offsets risk-weighted assets growth, giving us flexibility to support organic growth and allocate capital to strategic opportunities like the alternative investment transaction that Gloria referred to in the introduction.

Next page. Customer volumes grew by 6%, supporting a 6% increase in gross operating income with well-diversified contribution across geographies. Loan growth remains disciplined and continues to outperform the market, especially in Portugal, Ireland and business banking in Spain. Regarding Spain, Spain continues to see strong revenue growth with pretax profits rising by 10%. While retail volumes softened this quarter due to seasonal effects and tighter mortgage pricing, corporate lending and off-balance sheet wealth management have remained resilient despite market volatility.

Regarding Portugal, Portugal marks, as it was mentioned, its 10th anniversary. Growth remains robust. Year-on-year movements in cost of risk largely reflect the one-off gain from an NPL sale last year in the first quarter. Excluding this effect, underlying performance remains solid and well controlled. Ireland also continues to deliver strong growth momentum with volumes up 20%, improving profitability and exceptional asset quality. The NPL ratio remains just at 0.3%.

On Page 26, corporate and SME banking continues to grow well above the sector. Lending in Spain is up 8% versus 3% for the market with very strong momentum in international business, where growth reached 17%.

In Page 29, in retail banking, our approach remains disciplined and margin focus on both the asset and liability sides of the balance sheet. New account activity continues to be robust with salary and digital account balances growing by close to 50% over the past year, reflecting solid customer acquisition and engagement.

New mortgage origination in Spain was lower during the quarter, reflecting pricing discipline in a tight margin environment with compressed risk-adjusted returns. This is consistent with our focus of allocating capital where returns are more attractive, such as in Portugal, where mortgage growth reached 8% and in Ireland, where it grew by 37%. Overall, retail banking continues to prioritize profitability and balance sheet quality over volume at any price.

Next page, despite Wealth Management, despite heightened market volatility driven by recent geopolitical tensions, our Wealth Management business continues to prove resilient. Customer wealth increased by EUR 18 billion, up 13% year-on-year, supported by net inflows and a growing high-quality client base. Even in volatile markets, our clients remain invested and continue to allocate savings, reflecting the strength of our franchise and the quality of our customer base with flows that remain resilient through the cycle even in periods of elevated uncertainty.

Next page, you can see the same trend with double-digit growth in both AUMs and AUCs, reinforcing the resilient and recurring nature of this business. Finally, let me take a moment to review our ambitions for the year. This first quarter of '26, we have delivered a solid quarter and results fully aligned with our previous guidance, following a disciplined execution with excellent quality of results supported by recurring sources of revenues.

The recovery of client margin level to close to 270 bps in Q1 and the improvement of efficiency levels towards our ambitions are the supportive levels of another successful year. Despite the ongoing uncertainty in the market environment, our expectations and guidance for '26 remain broadly unchanged and current levels of profitability are expected to be sustained in coming quarters. We will consider changes to our guidance in the next results presentation with more visibility of our impact on macro scenario of current geopolitical events.

We continue to anticipate stable volume growth in line with our initial assumptions while maintaining our disciplined and balanced approach to liquidity and risk. On the lending side, we expect volumes to grow at mid-single-digit rates, supported by a still positive macro environment for all geographies where we operate by a selective origination and a strong focus on risk-adjusted returns.

Deposit volumes will be actively managed to preserve comfortable liquidity ratios and balance sheet resilience. Deposit to loan above 100% or loan-to-deposit below 100% are levels that have been committed in the past and will continue to be in the future. Across the group, we expect growth trends to remain broadly consistent with '25 levels and year-on-year for the first quarter, with Portugal and Ireland continued to deliver a strong performance and Spain maintaining solid momentum, particularly in corporate banking.

With respect to NII, the continued volatility in interest rates means that visibility over the coming quarters remains still limited. However, current levels of forward curves anticipate potential rate increases that are supportive for NII in coming quarters. We continue to manage customer margin towards the 270 basis points or above.

In this context, rather than providing new guidance on NII levels, we remain focused on the levers that we can actively control, which are pricing discipline of the assets and liability, customer margin management and prudent balance sheet optimization. As a result, NII should continue to be driven primarily by volume evolution rather than by changes in pricing or margin assumptions. We expect quarter-on-quarter NII growth during the quarters in 2026.

Beyond NII, we remain confident in our ability to deliver high single-digit growth in fee income, supported by our diversified business model and strong customer engagement. Recent corporate transaction on the alternative investment front is a good example of our strategic focus on recurring growth on the wealth management business.

At the same time, we remain fully committed to delivering positive operating jaws in 2026 with a cost-to-income ratio expected to decline below 35% for the year, supported by simplification of our business organization and the combination of talent and technological investments.

In terms of asset quality, our outlook remains stable. We do not see any signs of deterioration in credit quality, and we expect the cost of risk to remain around current levels. In this quarter, we keep improving our capital position, maintaining strong levels of capital buffers and MREL ratios.

And finally, we expect return on tangible equity to remain above 20%, reflecting the underlying strength of our business model and supporting continued attractive value creation for shareholders.

Now Gloria, back to you, please.

Thank you, Jacobo. Well, this final slide captures the essence of this quarter, resilient performance and sustainable value creation. Even in volatile geopolitical and uncertain macro environments, our returns remain high and sustainable, supported by best-in-class efficiency, strong asset quality and solid capital ratios.

RoTE stands at 20%. Shareholder value continues to build with dividends up 25% year-on-year. This consistency is not cyclical. It reflects a deliberate way of running the bank, prudent risk management, capital allocation based on risk-adjusted returns and continued investment in efficiency and organic growth.

Together, these elements explain why our model delivers consistently and support our confidence in continuing to create sustainable value in 2026 and the years ahead.

Well, thank you, and it is back to you, Laurie, so that we can kick off the Q&A.

Thank you both, Jacobo and Gloria. We'll now initiate our live Q&A session. [Operator Instructions]

Our first caller we have is Maks Mishyn from JB Capital.

Two questions from me. The first one is on deposit growth. There was a notable slowdown in the quarter despite several digital campaigns that you've launched. I was wondering what was the reason and how you see the remainder of the year. And the second question is on your expectations for customer spreads for the remainder of the year. If you could just walk us through loan yields and deposit costs for the next quarters, that would be super useful.

Hello, Maks. I will answer you the first question, and then Jacobo will answer the second one regarding customer spreads. Well, listen, we have very -- the first thing is that we have very comfortable liquidity ratios, as you might have seen in the presentation. I think, in the annex, we have an LCR over 200%. And well, we have a loan-to-deposit ratio below 90%. We have given priority this quarter to actually accelerate the change in mix in our retail funds. You have seen there is quite marked decline in deposits.

So we have been reducing the duration of our deposits. And also giving greater weight to more atomized and less sensible deposits. So we feel very comfortable with the liquidity ratios we have. We will continue to work on the cost and sensibility of our deposits in future months. So we will obviously maintain, as Jacobo has said during his presentation, we will maintain our commitment to have a loan-to-deposit ratio below 100% and solid LCR ratios.

Good morning, Maks. Taking your question on the evolution of the customer spread. I guess, first of all, the commitment to reach an average this 270 bps or above client margin spread for the year. And the trends in the lending yields are, I would say, positive in the sense that with the current levels of rates and the expected level of rates, definitely, there is a tailwind in positive repricing.

First of all, in our -- in the corporate banking activity that tends to reprice faster. And then, of course, in the mortgage activity in the mortgage book that reprices with a little bit slower, but in a positive way. So in the sense of the lending yield, we should see a slight recovery or a slight growth over the following quarters. In the sense of the customer -- of the -- sorry, of the deposit cost, deposit cost, we've ended the quarter with 80, 81 basis points. We think this is a quite reasonable level where we can be.

There might be a little bit room still for reduction, but this volatility in rates might be a little bit challenging for at least the second half of the year. We need to wait and see the evolution of rates. But again, our target is to ensure levels of 270 bps of customer spread. We know that the lending yields are going to be supportive, and then we will manage proactively pricing in the deposit cost to ensure that we achieve this level or even above following or monitoring the current level of rates and the expected rates.

Our next question comes from Francisco Riquel from Alantra.

My first question is a follow-up on customer funds. I see that salary and online deposits are up EUR 9 billion year-on-year. Total deposits are up just EUR 1 billion. So that means probably strong outflows in corporate deposits. If you can please comment on the pricing actions, both in retail and in corporates.

And also, if you can also comment on net new money flows into wealth management because I don't see that outflows out of term deposits are retained within the bank. And my second question is if you can please elaborate more on the strategy and the return on investment that we should expect from your recent corporate transactions in alternative investments.

I will answer you the first question because probably it wasn't clear enough. Well, regarding net new money flows, there has been a very strong commercial activity, over EUR 1 billion transformation in -- from deposits to our loans. But obviously, you don't see that movement because the market has detracted more or less the same amount. So this is why there is no movement from December to March.

But as I've mentioned, the -- I don't have the exact figure here, but it's between EUR 1 billion and EUR 1.5 billion of net new money in funds in off-balance sheet funds. So -- and with respect, you're right, I mentioned that we are -- what we are doing -- you're right, there has been a drop or outflows in corporate funds because we are prioritizing smaller amount with less sensible to interest rates.

So basically, we are growing in payroll accounts. We are growing in SMEs in transactional accounts and also in medium-sized companies in transactional accounts. So we are giving, as I've mentioned, priority to these type of accounts that are transactional and therefore, less sensible to interest rates. But there has been an important outflow as well to off-balance sheet funds of around EUR 1 billion, EUR 1.5 billion. I think -- I hope I've answered.

[ Paco ], taking your second question, I'm not sure if it's -- I took the right way. But basically, I mean, definitely, this business of alternative investment fund is a business that generates a quite high and sustained return on equity. This is a quite attractive business from our perspective. We -- as we had mentioned in the presentation, we want to be the leader of alternative investment in Iberia.

Definitely, this will provide sustained high level of fees in the long term. We think there is a huge opportunity in Iberia to progress in the development of these type of products. We provide access to investment of real assets to Spanish and Portuguese people in terms of retail clients. Of course, this is not a product for everybody, but we think there is a huge evolution and a huge potential in this business.

Taking these strategic transactions, we are bringing all the know-how from our partners into the company, into the bank, and that provides us the full potential of building and developing new type of investment funds in the short, in the medium and the long term. And I think this is a huge opportunity to bring on board capabilities that the bank doesn't have today and to ensure that we can build and distribute this type of products.

We are, as you know, investing in renewables, in infrastructures, in spaces, in everything. And these 2 partners are one of the leaders in Europe in these type of assets, and that's why we are achieving transactions with them. I hope I have answered. If not, I will talk later.

Our next question comes from Alvaro Serrano from Morgan Stanley.

A couple of questions from me, please. Gloria, I think you said at the beginning that you're not expecting an impact on consumption, but you're seeing some prudence. Can you maybe talk us through what you saw -- what we've seen during March and maybe early April. I don't know if it's sort of deposits movements, appetite for loans or fees, maybe what you were referring to around that prudent statement?

And then the second question related is when I'm thinking about the potential updates or changes to guidance that you referred to Jacobo in Q2. Are we thinking about sort of fees impact? Or can you give us a sense of in an IFRS 9 world, what the sensitivity could be to provisions if, I don't know, 50 basis points change in GP or something along those lines that gives us a sense of direction.

Alvaro, when I'm saying prudence, actually, what I refer is that probably the consumption will continue to grow, but not at the same pace it has done. So it will not contribute in the same way to overall economic growth. We are not seeing really any signal in the reduction of the appetite for loans or for lending and not really any changes from last quarter.

But when I say prudence is what I see in the streets and what the statistics start to say. So I don't think there is any alarm sign or anything at all. And my prediction is that consumption will grow, but not at the same pace as last year, and therefore, the contribution in GDP growth will be a bit lower than it has been. But GDP growth will still be robust and I think enough, of course, to deliver our targets.

Good morning, Alvaro. Yes, just to clarify, I mean, we think that in 3 months, so many things have happened in terms of volatility in the market that it's probably not very prudent to change our guidance so soon. But my words were oriented to the rate environment and the volatility of rates that we are currently under expectations of potential interest rate rates in the coming months. And that is my comment about.

We are not expecting for the time being any changes in fees. I think I've been very clear in terms of efficiency and in terms of cost of risk. And obviously, my comment is related to the NII guidance and the possibility to have more tailwind in coming quarters if rates continue to be high or stay high for longer.

Our next question comes from Marta Sanchez Romero from JPMorgan.

So my question is on capital. You're building capital at a faster pace than expected. I understand there will be seasonality in Q2 and Q4. But could you give us a sense of the capital generation you expect after funding growth and a 50% ordinary dividend? And related to this, can you remind us about your capital allocation priorities? You will be spending roughly 20, 25 basis points on the olds acquisition in Q4, but still that leaves you space to do more things, considering that you want to stay at around 2.4%, 2.5% core equity Tier 1. So can you remind us on your priorities, any bolt-ons that you could consider, what areas, businesses, et cetera? And when, if any, time would you consider to repay surplus capital to shareholders?

Marta, yes, actually, there has been a very strong capital buildup this quarter because, as you know, traditionally, the first quarter has some seasonality in credit. Actually, we have done a much better quarter than we thought we would do taking into account the seasonality in the past. So we have done better in credit.

So regarding our -- and you are right, sorry, that we will have to allocate 25 basis points next quarter to this -- well, next quarter or when it is -- when we have the regulatory go ahead, which will be, I think, in the next quarters rather probably next or the other, the following.

Where are we allocating capital? We are allocating capital in the geographies where we see there are profitable opportunities like, for instance, in Ireland. As you can see, we continue to grow at double digit at 20%, 23%, 27% in mortgages. And we will continue to grow at that pace. In Portugal, we think we have opportunities to continue to grow also at double digit. And we think we will do better in corporates and enterprises than this quarter. So this means a little bit more capital allocation following quarters.

And in Spain, given the situation in mortgages, where we see that the prices continue to be below -- well, below cost, cost of risk and not only cost of credit risk, but also including everything that has to do with maturity mismatches and interest rate risk. We are actually investing heavily in enterprises and corporate banking, where you have seen we are growing at a very -- I mean, at a higher digit than usually.

Said that -- so we think that we will be -- we will have a comfortable management buffer. For the moment, we are not changing our dividend policy, which you know it is cash 50% of net profit. But don't forget that we have the main shareholders sitting at the Board of Directors. So if there is excess capital, obviously, we will give it back to our shareholders as we've done in the past. I mean, remember that Linea Directa deal was actually an extraordinary dividend. So well, this is more or less, I think I've answered. So I don't know if you want to add up anything, Jacobo? No. Okay.

I think you've been clear.

Our next question comes from Sofie Peterzens from Goldman Sachs.

Here is Sofie from Goldman Sachs. So my first question would be on the customer margin versus NIM. We've all been very focused on the customer margin, and we saw a significant improvement this quarter, but the NIM was very flat quarter-on-quarter. So could you just kind of discuss what the delta is and why the NIM didn't improve this quarter and how we should think about the NIM improvement going forward?

And related to that, could you also discuss your rate sensitivity and how we should think about kind of higher rate impact on your net interest income, but also on the customer margin and NIM? And then my second question would be on kind of cybersecurity. We have seen headlines about some of these AIs that can kind of penetrate banks very quickly. What are you doing to ensure that your cybersecurity is top notch?

Thank you, Sofie. I'm going to start with your last question in terms of cybersecurity. I know this is a hot topic with latest news about Claude and Mythos. Basically, here, what has fundamentally changed I mean, Mythos does not represent a fundamentally new category of risk, but there an acceleration of existing cyber threats through AI automation.

So what really changes is the speed, not the nature of the attack. So the point here is in order to react, it's just basically with the same tools, trying to be much more agile and much more quick in the execution of the responses. So basically, the bank, ourselves or other banks, what they need to do is to move faster in the responses. So from manual responses to automated responses, behavior-based defense to integrate AI into security operations, of course, maintain human side.

But basically, this is the type of reaction. And I think also the type of reaction is not just a bank on bank individual type of reaction. I think this topic needs to be faced in a much more global approach in approach of an industry, of a country of an entire Europe because all these threats, all these threats is not just a threat to the banks. It's just to the whole economy.

So basically, this AI threat just changed the tempo of the cyber risk, not these fundamentals. And the right response is just basically make sure that there is a coordinated automated defense from all the industries and countries and basically reinforce resilience. So the tool may be a new tool for the attackers, but it's also a new tool for the defenders. So I'm sure that everybody will accelerate this -- the use of this new technology to accelerate the execution of the defense.

Okay. So related to the sensitivity. Sensitivity, we are around 3% for an increase of 100 basis points. I think that was your question. And in terms of NIM, it's just basically an activity on -- it's trading activity that has increased the volumes of non-client activity has increased volumes in the asset side and in the liability side, and that has increased a little bit volumes and therefore, maintain the NIM at current levels.

But the most important thing for us is that the customer margin has been recovery, that the weight of the client activity in our balance sheet tends to be one of the highest, if not the highest. And for us, that is really, really important. So we -- as I mentioned before, we continue to expect quarter-on-quarter growth in NII for the coming quarters until the end of the year. Thank you.

Our next question comes from Ignacio Ulargui from BNP Paribas.

I just have 2 questions. One is on Ireland. If you could please give us a bit of an update on your views in the country? And what should be the opportunities that you could see now after the corporate transaction and corporate movement announced by Bawag last week? And also if you could update us on the deposit strategy and the capacity to gather deposits there, when we should see a pickup on deposit growth coming from Ireland. And the second topic, it's on the ALCO. I have seen that you have increased slightly the ALCO in the quarter. If you could just remind us a bit what will be the expected contribution for the year. And also, what would be the capacity to increase that from here onwards?

Ignacio, I will take your first question. In Ireland, we continue to see a lot of opportunity going forward. Basically, actually, there was very -- as I've always said, the competition, it's not as a competitive market as it is in Spain, let's say it this way. Actually, the margins, for instance, in mortgages are much higher. We are allocating more capital into this business. The recent transaction of Bawag acquiring PTSB actually is another great opportunity in the sense that PTSB needs a very heavy restructuring. And as we have seen in the past here in Spain and many other -- also in Portugal, when a bank is restructuring, clients are not served properly and therefore, the customer attrition is higher. So we will take advantage of that situation in the next months.

With regard to deposits, we have been testing deposits since I think it was late 2025. And with existing clients by invitation because we wanted to test because we have a completely new platform overall and obviously, a new product. And we also wanted to test all the marketing processes as well. We launched it to open market in February, I think, but also with very little or almost no, I would say, marketing expense.

We have around EUR 50 million in deposits at present. And what we want to test is the system at maturity of the of these deposits before we enter in the market in a mass mode. So this will be in the next -- because most of these deposits have been signed 3 or 6 months, max. So this will be in the coming quarter.

We have also -- now we are testing a simple current account, which have already constructed. And we will probably by the summer or maybe probably after the summer because the summer is not the right month to launch these things, we will launch it to the market. When we have current accounts, it is when we will launch a more aggressive deposit-taking value proposition. So for the moment, you will just expect these little amounts to grow by a great percentage, by a low amount because what we're doing is testing our systems and also our marketing processes.

Good morning, Ignacio. Regarding the ALCO portfolio, the ALCO portfolio, as you know, has a volume which is limited to 2.5x our equity. So since our equity keeps growing quarter after quarter, there is an opportunity to grow a little bit the ALCO portfolio. So just -- we don't expect to go far away or above that limit. So whatever increases in the ALCO portfolio, they should be expected to be some sort of limited.

The current yield is around 2.5%. Expectation is that we can continue to have this level or even a little bit higher during the coming quarters, but no basic changes in the structure of the type of assets that is in the ALCO portfolio.

Our next question comes from the Cecilia Romero from Barclays.

My first one is on asset quality and credit risk. I mean, SME lending has been an important growth engine for Bankinter. And now as macro uncertainty has increased, how do you see credit risk evolving within the SME book? And are there any particular sectors where you are becoming more cautious?

And my second question is on cost. I mean you have highlighted a medium-term ambition to move cost-to-income ratio towards 30% over the next 3 to 4 years, which I don't think is reflected in consensus. Is this still realistic given higher inflation environment? And what -- could you explain us what are the key levers that will get you there?

Cecilia, thank you for your question. For the moment, we are not seeing any warning signs in asset quality in any of the business segments actually. Nevertheless, the situation is such that, obviously, there could be some economic contraction -- I mean, some economic impact of all these geopolitical events that are happening. And therefore, we are being very cautious, and we've already told you, I think, in past webcast with consumer credit and particularly what we call open market, which is not within our franchise of clients banking there.

So there, we are being very, very cautious. We are actually reducing exposure. With respect to SMEs, you're right, it is also one of the weakest parts of the economy. And what we are doing is actually also being very cautious. In SMEs, below EUR 2 million of turnover. And we are focusing our growth in companies above EUR 30 million of turnover and also increasing a little bit our exposure to the public sector because actually, most of -- a lot of the investment in the economy is done by the public sector at present.

So just to wrap up, we don't see signs of asset quality deterioration, but we think it is wise to be prudent with consumer credit in open markets and also in smaller SMEs.

Regarding your second question about the cost-to-income ratio and the ambition, we definitely -- this is our ambition. And of course, we do expect that the combination of talent and technology allow us to provide year after year the enough space between the growth of income and the growth of cost to achieve this target. So we keep maintaining our positive jaws during the following years.

As you've seen in the P&L that in this quarter, there is more than 3 points of difference between the growth of income and the growth of the cost. So this is something that we believe we can sustain. Of course, investment in technology, but also the organizational simplicity is a key driver of this achievement. Organizational simplicity from a legal perspective, of course, but also the limited number of branches that we have and the enhancing of the digital business also is a great opportunity to achieve this.

You mentioned inflation. So we do expect some inflation, as you know, but some temporary inflation. We do not expect inflation to stay at current levels for a long period of time. So we can basically deal with it. And yes, I mean, it's our ambition, and we think it's absolutely achievable.

Moving to our next question from Carlos Peixoto from CaixaBank BPI.

A couple of questions from my side. One of them would be a follow-up on the interest rate sensitivity that you mentioned, so 3% for 100 basis points rise. I was just wondering, this is in a 12- or 24-month period? And maybe if you could give us just some highlights on the assumptions behind those -- that sensitivity.

Finally, particularly on deposit costs and all of that. And then the second question on the cost side as well. So this 3% increase that we saw in total cost in the first Q., should we take it as a reference for the full year? Do you think costs might accelerate throughout the year? Just a bit of a view on how you see that evolving?

With respect to costs, we are targeting lower increases year-on-year in 2020 -- this year. So you should expect a reduction of the pace of growth in costs. And I think you can make a point on your -- the rate sensitivity he's asking.

And regarding the rate sensitivity, yes, good question, just to clarify my comment. So the rate sensitivity is around, as I mentioned, 3% for 100 basis points increase in 12 months. So if we were to measure this in 24 months, it will be close to 7%.

Our next question comes from Borja Ramirez from Citi.

I have 2. Firstly, on the deposits. Could you please remind me of the -- regarding your digital account deposits, which were the volumes and the average cost as of March? And also on this point, could you update on the competitive dynamics in the digital deposit market in Spain. So for example, who -- where are you seeing greater push on this side?

And then my second question would be on rate sensitivity. If you could kindly provide a bit more details on the floating rate loans because I think you have a greater portion of floating rate loans. And within corporate and SME, I think given the fact that it's more focused on short-term working capital loans, I think it reprices faster than peers. So if you could kindly provide more details.

Borja, thank you for your question. And I will be answering the one regarding deposits. Well, the digital organization where you have all online deposits, whether they are the ones coming from EVO or the ones that we acquired with the digital organization the last year already has EUR 11.7 billion in deposits. The average cost of all of this EUR 11.7 billion is 1.39% and it's going down.

Competitive dynamics. Well, this quarter, we didn't launch a major campaign with high marketing costs. Obviously, we have always ongoing campaigns. So what we see are the higher competitors this quarter have been in the traditional banks, ING and probably, I would say, Sabadell also had a campaign this quarter. Also Openbank from Santander. And then you have the digital banks or the neobanks. But the major -- I would say, our major competition at present, the ones that take or to whom we take deposits are traditional banks.

Regarding the rate sensitivity, you mentioned the floating rates levels in credit in -- or sorry, in SMEs or corporate. Let me just clarify. I mean, of course, working capital facilities tend to be short-term funding or lending that, I mean, in 90 days might change the rates. So that has a faster repricing.

But in lending, for example, in SMEs, there is a strong level of real estate guarantees, which tends to be mortgages. So I would say that the corporate banking book has a faster repricing than the SME book. I guess that this is your question. Of course, we have the floating rate mortgages, as you know, and everything related to credits that tends to reprice faster. But for example, in the SME activity, we have at least almost 3/4 of the lending book tends to be guaranteed with real estate positions. And that means these are mortgages, and that means that it takes longer the repricing of the SME book.

Our next question comes from Pablo de la Torre from RBC Capital Markets.

The first one would be a bit of a follow-up on the alternative investment transaction. And sorry to go back to the topic, but it would actually be quite useful to understand a bit more of the kind of line-by-line financial impacts of the transaction that you expect in coming years, both on the revenue and the cost side.

And then the second one would be a bit of a follow-up as well on some comments that I believe Gloria made last quarter. I think, Gloria, you mentioned you were working with some of your insurance partners to improve or review some of your agreements at that time and see how you could impact -- how could you change your current agreements. So I just wanted to know if there had been any updates on that side of the business on insurance income.

Yes. I mean, actually, I -- we have signed, I would say, an agreement with Generale in Portugal for non-life insurance, and this will be fueling growth in insurance in Portugal in the next months. So yes, yes, we have made progress there. And we are working in Ireland. That is also one of our strategic lines. For the moment, we are not commercializing insurance, but also to be commercializing insurance to our clients in the future.

And in Spain, well, I think that we are doing quite well, growing, most of the growth that you have seen in the presentation, this 8% growth in insurance actually has to do most of it with the Spanish market.

Coming back to your question of alternative investment. We are pretty active on this type of business. So once all -- we get all the authorizations for the transactions that they might be finalized by the end of the year, what we do expect is to start generating around EUR 1 billion of new volumes every year in the future. As I mentioned before, this is a quite good business in terms of the level of fees and the stable level of volumes that we can manage.

So this is a great opportunity for us to build up a very good business. In fact, we just launched a new product in Spain called FIL, F-I-L, which is an alternative investment fund to reach retail type of clients that can be switched or moved from fund to fund. So it is a great opportunity. We have similar levels of ambitions with this new product that we've launched.

Again, this is a clear message of the focus that we want to put in this type of business in wealth management in general, but in this type of business, we think Bankinter has a great opportunity and plenty of new income to come with a great return on equity.

Thank you. Let's move to our last calls, and we have 3. First is from Ignacio Cerezo from UBS.

First one is if you can give us the stock of the treasury deposits at the end of Q1, the one which is embedded within your side deposits that are remunerated. And if we should be expecting additional reductions in coming quarters on this deposit book? And then the second one is a follow-up to Cecilia's question on costs. I mean, how do we need to think about kind of logical evolution of headcount levels alongside the implementation of AI in the bank? Are you expecting a gradual reduction of staff personnel levels? Or do you think actually you're going to have to be replacing people leaving with new hires?

Ignacio, with respect to treasury accounts, we have around EUR 11 billion. And this quarter, it has gone down by EUR 1 billion. We don't expect major reductions in this line around maybe 10% or something like that because we have already done quite of the work that needs to be done in that portfolio.

So -- and with the other thing with respect to headcount. Listen, we are increasing headcount in Ireland, and we are increasing headcount in Portugal. In Portugal, for 2 reasons. We were keeping the same commercial workforce that we had in 2016. So obviously, there is a moment if we want to continue to grow and maintain the quality levels, we need to enforce, we need to reinforce the team, the commercial team.

The second in Ireland, it's obvious. We are expanding our activities to be a full-fledged bank. So obviously, we need to increase also the headcount there. We are talking around 30 per country, where we are seeing that the headcount is stagnating is in Spain. We don't foresee reductions of headcount, but we don't see either increases as the business grows. So we think that much of the efficiency will come from -- in the Spanish operations.

Our next question comes from Hugo Cruz from CBW -- KBW, sorry.

I was wondering if you could just give a bit more color on your loan growth dynamics by product over the rest of the year. You're growing 5% year-on-year, but with the macro potential, we could see a slowdown even if you keep at mid-single digits. So if you could give a bit more color.

We keep our commitment to grow this mid-single digit around this 5-ish percent. And we think we still have opportunities to grow in profitable business lines, like I've mentioned, mortgages in Portugal, mortgages in Ireland, but also enterprises in Portugal and a lot in Spain in greater -- for companies over EUR 30 million turnover and also a bit more in the public sector.

And our last question comes from Britta Schmidt from Autonomous Research.

Just quickly coming back to the deposits. Could you give us the split of the deposits into corporate and retail where they are now and where they would be, for example, by year-end. And you mentioned that you're changing the mix to more atomized deposits. How do you think that would impact your deposit beta? It peaked at something more than 50%. If we were to see rate rises, do you think the deposit beta would be substantially lower, slightly lower. And even with these changes that we're seeing, do you still prefer to manage your NII sensitivity at around the 3% level for 12 months? Or could we see that improving?

Now regarding the beta, as you know, it depends how you make your calculations. Today, we are around 80 bps with the current level of 2% in ECB rates that gives you a ratio of around 40%. So we do estimate this 40% to keep going down in coming quarters. So whatever increase in rates that might happen, we estimate that no more than 10% of that increase in rate could be -- could potentially impact the cost of deposits. So beta is going to continue to go down over the next quarters.

With respect to the mix, I don't really have what the mix is between big corporates and because what we call retail includes also SMEs. So I don't have the exact figure. I think, yes...

We'll come...

We will come back to you later with. But yes, I mean, you can expect a reduction in bigger corporates and you can expect an increase in what we call retail or transactional accounts, which include, obviously, SMEs and also retail.

Thank you. Thank you, everyone. Thank you, Gloria and Jacobo. And that now concludes our session. And on behalf of the entire Bankinter team, we thank you again for your interest and participation in the webcast. Everyone, please have a great day.

Thank you very much. Bye.

Bye.

Good morning, and thank you for joining our 2025 full year earnings call. Financial statements were posted with market authorities early this morning. All materials can also be found on our corporate website. Please refer to disclaimer in the presentation and note that this call is being recorded. And we welcome today our Chief Executive Officer, Gloria Ortiz, and Chief Financial Officer, Jacobo Diaz.

Gloria, over to you, please.

Thank you, Laurie, and thank you all for joining us in this 2025 full year results presentation. Since we are reporting the full year, I believe it's appropriate to start with a brief overview of the environment in which our business has operated to provide context for the figures that we are about to review.

2025 was the year of Donald Trump's return to the White House and even that has set the political tempo of the international calendar. Continuing the trend of previous years, the events in 2025 confirmed that the international landscape is moving towards an increasingly turbulent and fragmented scenario. Long-standing conflicts, such as Ukraine, remain unresolved despite failed attempts to reach an end to the war. In Gaza, the ceasefire came only after months of escalating violence. Meanwhile, the Franco-German Axis, the traditional engine of the European Union, has been weakened by deep domestic political crisis.

Without a doubt, tariff has been the most repeated word of the year. The imposition of tariffs on international trade has become the main diplomatic pressure tool of the Trump administration. The European Union, which for years has been a strategic partner of the United States, ultimately considered in trade negotiations and accepted a 15% tariff to maintain access to the U.S. markets.

Thus, the balance of 2025 confirms an international landscape that is increasingly fragmented and less predictable, where open conflicts tend to become chronic, and long-lasting political solutions are replaced by fragile truces or unbalanced agreements.

And indeed, what we have been observing in these first weeks of 2026, for example, in Venezuela or in the U.S. stance on Greenland, amongst others, confirms that this year will again be marked by geopolitical volatility just as 2025 was. At the same time, technology, led by artificial intelligence, continues to advance at a blistering pace, transforming operating and business models. And the banking sector is undoubtedly no exception. These are global trends shaping the broader environment.

But if we focus on the countries in which we operate, it is worth noting that the 3 economies, Spain, Portugal and Ireland, are among the most dynamic in the Eurozone and have become the new growth locomotives of the union. In fact, the Eurozone in 2020 -- in fact, in the Eurozone in 2025 inflation, which had surged sharply after the pandemic and the Ukraine war, moderated. And as a result, the ECB accelerated interest rate cuts, especially during the first half of the year.

With inflation under control at the European Central Bank's target level, benchmark rates stabilized at 2%, and no further cuts are expected in the short term. As a result, in 2025, the ECB reference rate averaged 2.2%, that is 1.4 percentage points lower than in 2024, while the 12-month Euribor fell by an average of 1.05%.

Turning to financial markets. It's notable that despite escalating conflicts and increased political polarization, market performance remained robust. The IBEX 35 achieved a record increase of 50%. German equities rose by 23%, and the NASDAQ advanced by 19%. In this environment of geopolitical uncertainty and significantly lower interest rates compared to the previous year, we have delivered in 2025, very strong results, once again, record breaking. These results are built on solid foundations and driven by recurring client commercial activity. Moreover, in 2025, we executed major strategic projects that will underpin the bank's future growth such as the integration of EVO Banco and Avant Money, which is now Bankinter Ireland, a branch of Bankinter just like Portugal.

Of course, before moving on, I want to express my thanks to all Bankinter Group employees for their dedication, effort and commitment because they are the true architects of the results that we present today. The results we present today are very satisfactory, driven by intense commercial activity that brings us to report a net profit of EUR 1,090 million in 2025, representing 14% growth over the previous year.

2025 was marked by diversified growth, both geographically and by business line. Overall, we grew 9% in total business volume, 5% in lending, 6% in customer funds and delivered a strong double-digit growth, 19%, in off-balance sheet products.

Despite the sharp decline in interest rates, we managed to limit the falling interest income to 1.8% in 2025. And on a year-over-year basis, the inflection point was reached in the first quarter. From that point onward, net interest income grew quarter after quarter, thanks to credit growth and margin management.

Customer spreads averaged 2.68% for the year with the overall NIM at 1.78%. Fee income from services had an exceptional year, growing 11%, which in nominal terms, almost doubled the reduction in interest income. This allowed us to grow gross margin by 5%, and I think it is important to note that the strong performance in fee income is due to the significant growth in our balance sheet funds and not to any increases in customer fees.

All this growth has been achieved while keeping our risk appetite unchanged, improving the asset quality of our balance sheet, reflected in a nonperforming loan ratio below 2%, specifically 1.94%. Another key element of our business model is efficiency at 36%, indeed the best efficiency level across the industry. These 3 pilots, the diversified growth, asset quality and efficiency, are the foundation of our business profitability, which reached ROTE of 20%.

As I have been commenting in previous quarters, commercial activity with clients has been very strong. Total customer business volume stands at EUR 241 billion, EUR 20 billion more than in 2024, representing 9% growth in the year or a compound annual growth rate of 8%, an increase of EUR 80 billion since 2020. This volume breaks down into EUR 84 billion in lending, representing 5% growth versus 2024 at year-end.

Customer funds reached EUR 88 billion, EUR 5 billion more than a year ago, and we now manage EUR 69 billion in assets under management, 19% more than at the end of 2024. We have more than doubled the balance recorded at the end of 2020 with a compound annual growth rate of 17%. All this growth is organic and diversified with every geography contributing and outperforming the market.

Our diversified customer business volume growth is what enables us to consistently strengthen revenue streams. Core revenue fees and interest income reached EUR 3,032 billion, a compound annual growth rate of 12% and a record for the series, exceeding 2024 by 1% despite the headwind of lower interest rates. We achieved this by limiting the decline in interest income to 1.8% through volume and margin management and through the excellent performance of fee income, which with an 11% growth rate more than offset the reduction in net interest income.

The drivers of fee income are the strong growth in off-balance sheet funds, the increasing activity of Bankinter investment across all its business lines and the positive performance of the economies in which we operate.

Regarding interest income, I would like to highlight its upward trend throughout the year. It bottomed out in the first quarter of 2025. And from that point on, revenues increased quarter after quarter. By the fourth quarter, we already grew on a year-on-year basis by 4%. So the outlook continues to be more positive, especially with the forward rate current scenario for 2024 -- 2026.

In summary, sustained growth, asset quality and efficiency are what allows us, once again, to deliver results that surpass our own records, exceeding EUR 1 billion and representing 14% growth versus 2024, tripling our results over a 5-year period. Our ROTE now at 20% is also the highest in the entire series.

Before I hand over to Jacobo to review in further detail the financial results, I wanted to quickly showcase one commercial strategy that was quite successful in 2025. In 2025, the 100% digital new client acquisition is what I'm referring to. Since the EVO integration, we have improved our digital customer experience with the use of AI in commercial and marketing processes.

Our deposit gathering capabilities are now stronger, more granular and flexible. We increased customer funds in this channel by 64% in the year, now reaching EUR 12 billion, close to 14% of our total customer deposit base. New customer acquisition trends have doubled since 2022, and the digital channel now represents more than half of the new client acquisition in 2025.

From an industry perspective, our digital offering is -- not only allows us to compete effectively with new entrants, but gives us a clear competitive advantage. Customers benefit from a full multichannel ecosystem, digital branches, contact center and also private banking network, which enhances loyalty and broadens upsell opportunities. In the second half of 2025, the strong growth of this channel generated some short-term pressure on deposit cost. However, looking ahead, our digital strategy and strengthened deposit gathering capabilities create meaningful upside supported by lower acquisition and servicing costs. Overall, our digital franchise has become a scalable and cost-efficient acquisition engine that strengthens loyalty, supports margin resilience and accelerates fee growth, a competitive moat that becomes more powerful each quarter.

Jacobo, now over to you.

Thank you very much, Gloria, and good morning, everybody. 2025 marks yet another year of increased revenues and profitability. In operating income, we have grown by 5% with increased volumes, continued strong fee growth and effective margin management. Operating costs were more balanced this year over the quarters with annual cost growth growing below revenue growth to end the year within guidance, confirming positive operating jaws another year. Cost of risk and related provisions declined by more than 15%, reflecting a continued positive trend in risk management. And net profit increased by 14.4% to well surpass our initial goal of EUR 1 billion in 2025.

Onto NII and customer margins on the next page. NII contributed to EUR 2,237 million this year, slightly below our initial target. Asset yields for the year averaged 365 basis points and remained quite stable this quarter at 3.48%, down only 1 basis points from the third quarter given the good volume growth, especially in corporate and uptick in short-term interest rate. This helps soften the impact of a slight increase of 3 bps in quarterly deposit costs due to the same uptick in short-term rates as well as a successful commercial strategy that Gloria just mentioned regarding digital account deposit gathering.

Customer margins for the year averaged 268 basis points, very near to our 270 longer-term target. We believe Q4 '25 mark a low point, as the downward repricing of digital account deposit is underway in Q1 '26. Therefore, we expect customer margins to recover moving forward. NIM averaged 178 basis points for the year as the noncustomer interest income improved in the quarter, leading to an increase of NIM of 4 basis points in Q4. Regarding the ALCO portfolio, this has been achieved through increased ALCO balances that you can see on Page 13 as well as reduced wholesale funding costs.

Moving on to fees. Fees continued to deliver sequential increases each year, reaching EUR 795 million, up 11% versus 24%, reaching a double-digit compound annual growth rate of 10%. This sustained growth momentum is mainly attributable to the strong growth volume or strong volume growth in asset management, custody and brokerage services.

Moving on to Page 15. Equity method and trading dividend income lines also up with an impressive 21% on a year-on-year basis. The diversification of sources of revenue is well represented here as a result of our business investment in the past. For example, Bankinter investment that we will look later in the presentation, insurance JVs as well with our JV in Portugal with Sonae called Universo. We also confirm the banking tax will have no impact in 2025 and expect this to be the case for '26 and '27.

Moving into the contribution of gross operating income, there's been a very strong contribution from each geography in gross operating income, demonstrating increased diversification with Portugal and Ireland, growing from an 11% contribution to gross income in '22 up to 16% in '25.

Moving to the expenses on page 17. We have contained total operating cost growth to 4%, notably with flat general expenses due to the tangible impact we are achieving through our IT and AI initiatives as well as with the EVO integration. Efficiency ratio improved to 36.1% this year, demonstrating our commitment to delivering positive operating jaws now and in the future.

On Page 18, PPP more than doubled over a 5-year period to reach EUR 1,947 million in '25.

Moving on, we see improvement in credit and other provisions. Significant decrease in cost of risk down to 33 basis points from 39 basis points in '24 with loan loss provision volumes now below those even of the ones in '23. Other provisions also performing well, down to 8 basis points for the year with no signs of deterioration in the market of -- in our portfolio, and our disciplined approach to risk management, we remain optimistic to maintain current levels for the coming quarters with potentially some upside risk.

Next page, net profit reached once again historical levels at EUR 1,090 million, an exceptional increase of 14.4% in the year, maintaining similar growth rates seen in '24 even with the headwinds faced in interest rate during the year.

Moving into the credit and asset quality indicators, as you can see, they continue to improve. Risk quality measure in terms of the nonperforming loan ratio has improved significantly this year breaking below 2% to reach 1.94%. The coverage ratio remains very solid at 68%, substantially higher than in the 2020. By geographies, Spain, down to 2.1%; Portugal at 1.4%; and Ireland, stable, 0.3%, all well below sector average consistently over time.

Moving into capital. Our CET1 ratio ended the year at 12.72% and well above the minimum requirements of 8.36%, leaving an ample capital buffer of 4.4% as well as adequate MREL and leverage ratios. Main movements in the year related to retained earnings contributing to a total of 111 basis points, capital consumption of 51 basis points in RWAs and 35 basis points in operational and market risk. The implementation of the countercyclical buffer in Spain has resulted in a 41 basis point increase in minimum requirements.

Moving into Page 24. Commercial activity, volumes and profit trends remain not only strong, but with a greater diversification each year across geographies. Customer volumes up 8% in Spain, 15% in Portugal and 23% in Ireland. Each region contributed at increasing levels to the profit of the bank as well we see on the following slide.

Within Spain, loan growth this year, up 3% with a strong performance in the business lending segment growing 6%. I consider this satisfactory growth rate, especially when considering the intense competitive margin dynamics in Spain as well as our reduced appetite for open market consumer lending in Spain in 2025.

Retail deposits continued to demonstrate solid and balanced growth, increasing by 5%, fueled by the successful digital campaigns we mentioned a little bit earlier. Stellar performance in Wealth Management, reflected by an 18% increase in assets under management balances as well as a 19% increase in assets under custody. Profit before tax, up 14%, reflecting solid contribution from our core Spanish business.

Moving into Portugal, a continued momentum in lending activity across both business segments, up 9% in total with a strong deposit gathering growing 8% as well as a substantial increase in wealth management and custody balances, rising 28% on a year-on-year basis. Cost-to-income ratio at a very efficient low level of 33% even with increased investment in IT. Profit before tax, up 7% to EUR 210 million or 14% of total contribution to the group.

Moving into Ireland. 2025 marked the year for our Irish business to convert into a branch of Bankinter, allowing for increased upside risk in terms of volume potential and efficiencies. We launched deposit in Q4, albeit with volumes still at marginal levels, definitively more to come in this space during 2026, as we begin to scale up deposit campaigns this quarter. Asset market dynamics and our Bankinter style commercial differentiation supported a 27% growth rate in the mortgage book in '25, with improved trends seen in the second half of the year. Consumer finance also growing at 11%. Profit before tax contribution reaching EUR 46 million, up 13% this year with important improvements in the cost-to-income ratio down to 44% from 48% last year.

Now moving into the corporate and SME banking business. Business lending continues to deliver a strong performance, up 6% this year, consistently increasing market share year after year. One key growth catalyst continues to be our international business segment that has doubled loan volumes over a 5-year period, now reaching EUR 11 billion, representing 30% of the business lending book currently. This segment is also a strong recurring contributor to fee income from services. We also see increased activity and upside risk from other growth catalysts like our new ESG client solution across loan and servicing income products. For example, the loan advances we provide for energy certificates, where we were the first to launch in the market in 2025.

Additionally, we are expanding substantially our Bankinter investment business that I will detail more in the next couple of slides. Bankinter investment has doubled income contribution to the group over the past 5 years with currently 31 alternative investment vehicles and associated vintages well distributed over the year since 2017. More than 15,000 Iberian Bankinter customers now invest in real assets. This franchise has been a key source for the increased fee income to the group, reaching a 12% compound annual growth rate with upside risk potential for the future.

On the next page, you can see the strong diversification of the different investment strategy for the vehicles across many sectors and countries with more than 360 different underlying assets in the portfolio.

Moving on now to review the Retail Banking business. Retail banking asset and deposit trends remained strong with increased core salary account balances up by 7%. New mortgage origination, up 10% year-on-year, with solid market shares of new production across Spain, Portugal and Ireland. Our mortgage back book is growing steadily at 5% annually despite rising competition in 2025.

The Wealth Management business, on Page 32, shows our high-quality affluent client base that continues to drive exceptional incremental wealth volumes, up EUR 21 billion this year, a 16% increase on a year-on-year basis, of which half of it is new money to the bank. When excluding the market effect, the net new money has reached the EUR 10 billion level milestone, well above our historical range between EUR 5 billion to EUR 7 billion.

Off-balance sheet, volumes under management and custody on Page 33 ended the year at EUR 156 billion, up EUR 25 billion, or 19%, increasing significantly with the markets and net new inflows in all categories. With the exception of fixed income security, we have provided additional details regarding commercial activity and trends for those key fee income growth catalysts in the annex, no doubt a key driver of continued fee growth for the future.

Now, let me just spend a couple of minutes sharing our ambitions and targets for 2026 before I hand back to Gloria. We expect -- the first one, we expect solid macro outlook for all the regions where we are operating. Therefore, we expect growth across all segments and geographies, focus on our targeted type of customer and insurance and ensuring a disciplined risk-return approach for asset origination.

Volumes are expected to grow at similar levels than in '25 and previous years. This means that lending volumes at mid-single-digit growth with deposit volumes targeting to keep our liquidity ratio stable, that is above 100% in terms of deposit to loan or below 100% in terms of loan to deposit. All geographies and business segments are expected to grow at similar levels with Portugal and Ireland keeping their successful track record, and Spain, keeping strong volumes in the corporate and retail businesses.

Regarding NII, with the current Euribor 12 months rate outlook in '26 stable around current levels or slightly increasing towards the end of the year and next -- and following years, we expect customer average margin to recover 270 bps, our initial target. And therefore, we target in 2026 overall similar levels of client margins and NIM that the ones we saw in 2025. With residual negative repricing for mortgages and a downward repricing of our digital accounts in Q1, we expect minimal margin compression in the first half '26 with an upside bias to possibly reach a stable asset yields by the end of Q1 and beginning of Q2.

Given these dynamics, we would expect NII for the entire 2026 to increase in correlation with volume growth. For fee growth, we target high single digit for the year, supported by increasing volumes from assets under management and assets under custody as well as from increased transactionality from each of the geographies, which are strongly correlated with the economic growth of each of them.

With our strict cost allocation and management, while keeping strong IT investment around 10% of our gross income, efficiency remains one of our pillar or our main pillars, and we are committed to delivering positive operating jaws, again, in 2026, reducing cost-to-income levels below 35% for the year.

In terms of credit quality, we have a stable outlook for cost of risk for the year around current levels of 33 basis points, albeit with a positive bias. And ROTE is expected to stay above 20%, ensuring attractive shareholder value creation.

In summary, we expect 2026 to be another year of consistent growth in volumes and profitability reaching new records in volumes, gross income, efficiency, net income, and of course, profitability.

Gloria, back to you, please.

Thank you, Jacobo. Thank you for sharing our financial ambitions. In terms of our management priorities, all of these are well-integrated and will contribute to our financial goals with high-quality volume growth, a greater diversification of income from servicing fees and geographies. We will continue to invest in technology to achieve tangible benefits from our AI initiatives, driving both competitive differentiation and operational efficiencies. The outcome will undoubtedly result in a strong profitability and sustained improvement in shareholder returns. The key driver for this success centers around our clients and our employees.

2025 is a pivotal year for artificial intelligence, and we are committed to embedding AI tools and culture throughout the group. I will oversee project selection to ensure we achieve tangible results. Our program called AI First is designed to enhance our competitive advantage by integrating AI into all our customer-facing acquisition and service applications. We are committed to deploying personal productivity tools company-wide aiming to achieve 5% improvement in productivity over the medium term.

Regarding process efficiency, ongoing initiatives across back, middle and front office focused on integrating AI gen applications into our banking operations. Coupled with leveraging AI tools for software development, we anticipate a 10% increase in capacity equivalent to approximately 1 million hours over the next few years. However, AI for Bankinter is not just a plan, it is a reality with substantial progress achieved in 2025.

On Page 37, you can see the measurable improvements in productivity and efficiency thanks to the bank's digital transformation and the pragmatic and effective use of artificial intelligence in operational and commercial processes. We remain committed to investing 10% of our gross income in technology.

On the lower left-hand side of the page, we have highlighted several examples of our use of AI in 2025, which have contributed to enhanced employee productivity. With EUR 36 million managed per employee, we compare very favorably to our peers with EUR 21 million per employee. And if we measure efficiency in terms of operating cost per billion managed, we also stand out. We allocate EUR 4.6 million of expenses per EUR 1 billion managed for our clients while our competitors require EUR 6.5 million for the same volume. Naturally, this is reflected in the efficiency ratio, which has improved year after year and now stands at 36%.

Finally, I would like to highlight that all these gains in efficiency and productivity are not being achieved at the expense of service quality. In fact, service quality, measured in NPS, has improved by nearly 10 points since 2020 and now stands at 51%.

Turning to the financial page -- the final page of our presentation. We report a ROTE of 20%, 100 bps above 2024, together with continued value creation for shareholders through both dividends and growth in book value. We are presenting another year of historical results driven by recurring customer activity and the disciplined execution of a long-term strategy that preserves our risk appetite while strengthening the balance sheet as reflected in the ongoing improvement of our NPL ratio.

We continue to invest in initiatives that support business growth while at the same time improving efficiency. The drivers behind our performance, diversified growth, disciplined pricing, strong fee income engines and best-in-class efficiency are structural and provide strong visibility into continued profitable growth.

In conclusion, 2025 demonstrated the resilience and strength of our business model even in a year of declining rates, geopolitical volatility and intense competition. Bankinter expanded volumes, protected margins and delivered record profitability. It was not just a record year, but a clear demonstration of the strength of our franchise, the quality of our growth and our ability to generate attractive returns and create long-term value for our shareholders.

Back to you, Laurie.

Thank you, Gloria, and thank you, Jacobo. We'll now open up for questions. [Operator Instructions] Our first caller is Maks Mishyn from JB Capital.

Two questions from my side. The first one is on the competitive environment in lending in Spain. Your retail book is growing below the sector, and my question is whether it is intentional, why and when can this change?

And the second question is just a clarification on the cost of risk guidance. You mentioned upside risks. What has to happen for them to materialize? And what kind of upside risk are we talking about? Could you please quantify them a bit more?

I will answer you the first question, regarding competitive environment in Spain. Listen, I actually -- I think I pointed it out last quarter. We are seeing some irrational behaviors, particularly in the mortgage business, although also in other segments, but mainly, I would say, in the mortgage business. And you will understand it very, very quickly. I mean, there are offers, and I'm not talking to private banking clients. I'm talking to very standard clients, where they can get a 30-year mortgage at 2.20% for 30 years fixed, I'm talking.

And as you know, the swap curve for the 30-year is over 3%. So basically, it's like selling a mortgage with Euribor minus 80 or even more. That is absolutely rational because even if that rate has a positive margin this year, obviously, you are building a portfolio that is not sustainable. And in 30 years, rates can do many things. So we are not into that world. We are not going to sell mortgages at 2.20% because we want to build a sustainable portfolio in any environment -- well, probably not in any environment, but in most of the environments, and we are not going to enter in that war. So we are producing with our clients, and we are competing in those clients where we think they deserve better rates. But we are not going to enter in that war.

Maks, this is Jacobo. I'm going to answer your second question, and maybe there's a misunderstanding. The cost of risk that we're expecting for 2016 is quite similar to the current levels that we've seen here at the end of the year, which is around 30 bps -- 33 basis points. I think the word upside risk means -- it's meant in a positive way. That means that it could be even a little bit lower, not a little bit higher. So it's the way we can interpret that word. I think we think that we are under a good macro outlook for Spain, Portugal and Ireland.

As you know, we are reducing our exposure to the consumer finance business with non-Bankinter client. We are reinforcing of being more prudent in all our activity. So the sense of the sentence that I mentioned of the upside risk doesn't mean this might go up in terms of cost of risk. I was trying to say that it can be even better than the current levels of cost of risk. I hope that I have clarified my point, and I expect that this was your question.

Our next question comes from Francisco Riquel in Alantra. Francisco, go ahead.

Yes. So my first question is I wanted to ask about your guidance of mid-single-digit growth in loans, if you can, please share indications by country. It seems to me that your guidance could be conservative if just the sector in Spain grows 4%, 5% in '26, which is nominal GDP growth. So you have grown a bit less than the sector in Spain. You were commenting that. So I wonder if you are willing to continue losing market share, particularly in retail mortgages in '26 or if you -- we could have upside risk to your volume guidance overall?

And then my second question is regarding the guidance for cost inflation. So you have given cost-to-income reducing 1 percentage points, which means 2 percentage points cost inflation below revenue growth, meaning also cost inflation lower than in '25, but you need to invest in Ireland to become a full universal bank, also in Portugal. So that probably means very little cost inflation in Spain. So if you can, please elaborate on the cost guidance, the longer-term ambitions that you have presented for 2030, how do you plan to leverage technology to achieve that? I see other banks are still investing in technology. So if you can please elaborate.

Thank you, Paco, for your question. I will try to answer the last question and maybe give some indications about the first one, but Jacobo will complete what I say. Okay. With respect to costs, obviously, technology is going to help, but this is not -- it's not a miracle. So we are not going to attain obviously, all that efficiency only with technology. I remind you that last year, we integrated EVO Banco. This year, 2025, we only had synergies for the half of the year. Next year, we will have the synergies of this operation for the full year.

On the other hand, we just announced, I think, in December that we were absorbing consumer finance -- Bankinter consumer finance into Bankinter. And obviously, this means a simplification of the corporate structure that also brings some synergies. So it's a question of the traditional cost management technology and also all the simplification that we are undergoing in the corporate structure.

And with respect to lending growth, listen, if the competitive dynamics continue to be in the mortgages -- in retail mortgages, the ones that we have seen during 2025, we are happy to be prudent and not to grow at the same pace as the market grows. But I hope because it doesn't make any sense that the market reacts and that we come back to a logic dynamic in pricing.

Another thing where we are also reducing our growth rates is in everything that has to do with consumer credit in the open market. This means outside Bankinter clients in Spain because we are seeing already, as you can -- you know, there have been many announcements with regards to -- with regard to the new law, and well, there are a lot of problems in this -- I would say, a lot of compliance risks in this business.

Do you want to complement? No?

Yes, yes. Paco, good morning. No, no, I think in addition to -- I mean, basically, what Gloria is trying to say is that we are sticking to the same type of client or target of client that we've been sticking in the past, even with this exclusion of the consumer finance business in the open market activity. So this is one of the reason. We are targeting selective origination of lending. And even though we are able to keep the similar level of growth even if the market might grow a little bit more. But we prefer and we prioritize a good return and risk combination instead of volumes.

Ireland is going to grow, again, quite strongly, double digit. Portugal is going to grow again strongly, double digit. And Spain behavior is going to be very positive. But always, we are prioritizing the combination of risk and return.

Our next question comes from Marta Sánchez from JPMorgan.

The first one is a follow-up on cost. So you're mentioning a commitment to positive jaws every year. You're going to be below 35% cost-to-income. What do you think is the right level to run the bank? And do you see a 1% positive progress every year for the next 3 to 5 years?

And the second question is on the customer spread. You are committed to that 270 basis points. This quarter, we are a bit far from that level, 261. How are you going to be rebuilding that margin? And what is the outlook for net inflows into your digital account for next year?

Marta, I'm going to start answering your second question about the customer spread. So Gloria has already mentioned that we are updating the cost of the digital accounts. This is going to be a good behavior in the first quarter of this year, and this is going to instantly recover part of the client margin, again, targeting the 270 in average that we've mentioned for the entire year. So for the year -- I mean, the cost of deposits are the ones that we will expect more contribution to this building up the 270.

Loan spread that have ended the year at 3.48% last quarter also is intended to recover across the year.

We expect or there is expectation of a steepened yield curve that will provide more upside in the second half of the year than in the first one, especially with mortgages. So we do expect that the contribution of the asset yield might be a little bit lower in the -- to recover that position. So maybe a couple of bps in average. But definitely, the cost of deposit is the one that will drive the most -- the majority of the building up of this 270s across the year.

And in terms of cost, yes, I think one -- always it's very difficult to tell if it's 1 or 1-point-something point every year. But definitely, the message of Gloria is that we have a strong ambition to reach very low levels of efficiency. We think that we should aim to reach 30% not too far ago. This is where we want to be in terms of efficiency ratio. And this is something that we want to build in the next 3, 4 years, maybe.

Our next question comes from Ignacio Ulargui from BNP Paribas.

I have 2 questions. The first one is on fees, looking to insurance fees and distribution fees related to insurance products. I mean, I just wanted to see if there could be any acceleration of that into 2026, if there is chances to rethink about the JVs that you had in the non-life business. What could be the strategy on the insurance business?

And the second question is on the capital front in the quarter, that has been like 19 basis points positive effect from intangibles and other adjustments, if you could elaborate a bit what was the driver of that?

Ignacio, I will try to answer your first question. As you know, we have to -- well, we have a JV with Mapfre that's in life insurance, but also in non-life in all segments but auto and home insurance. In home insurance, we are growing very nicely, actually, and also, in life insurance. But where we think that we could grow more is in all the other segments that are outside life and home insurance. And yes, we are working. We are working with Mapfre to see how we can give a greater push to this business. But we have no plans for the moment to make any changes in the JVs that we have. But as I mentioned, we are working with Mapfre to see how to improve this 7% growth rate.

Ignacio, I'll answer your questions. Yes, I mean, at the end of the year, we reduced the deduction of intangibles just because all the IT assets that have been developed come into production in this fourth quarter. Therefore, we reduced the deduction as intangible, and then, we start the amortization of these IT assets.

Our next question comes from Pablo de la Torre from RBC.

I had a first question on the potential uses of the excess capital that you're expected to generate going forward. So beyond organic growth in existing markets, how do you envision to use this excess capital? And I know Gloria has already commented on this last quarter, but you continue to be linked to a potential transaction in Ireland. What is kind of your latest thinking there? And given the outlook more generally for the bank, have you discussed plans to change the ordinary payout going forward?

Then, it's more of a -- my second question is a follow-up on the corporate structure simplification point in consumer finance that you have already discussed. But I wanted to invite you to comment on the revenue opportunity from this change. Payments and collection services is already a large contributor to fee income for the bank, but it seems that the revenue growth there has been decelerating a little bit over recent years. And so can you just please provide a bit more color on how this change can -- how the change you have announced can contribute to revenue growth going forward?

Thank you, Pablo. With respect to Bankinter consumer finance, and you are talking more about the payments, the new payments area, I suppose, that we announced at the end of the year. We have done this -- well, first, payment income is not growing so strong because the regulation with regard to payments for instant payments, well, is such that has an activity that was fee-generating, what has become an activity where you charge no fees at all. So that has had an impact this year. It won't have an impact next year because, obviously, we are already comparing equal things.

But with respect to payments, we have started a strategic thinking about this because this is an area that is really being transformed by technology with everything that has to do with stablecoins, digital euro with request to pay in the transactions between businesses. And we need to have a strategy and a value proposition. We need to understand what will be value-creating in the future, what is just a bluff, as we say, because there is a lot of noise, and we have to take the noise out of the room. I think payments can be -- there is a side of this strategy that is going to be protecting our business and the other one is going to be how can I make my business grow more.

For the moment, I cannot tell you anything because we are working on the strategy, as I mentioned, but I'm sure that we will have some news in the next quarter or maybe in June. With respect to capital, well, we are not changing. We are not going to change our dividend policy just because we have 30 basis points more capital than our objective level. And we are not building up capital for any purchase in Ireland. I mean, I've mentioned already we have -- our strategy there is organic growth. We are building a bank from scratch, and that is what we are going to do. We are not looking at PTSB. And -- I don't know, I cannot be any clearer here. So I think I've answered Pablo.

Our next question comes from Borja Ramirez from Citi.

I have 2 questions. Firstly is on Ireland. I would like to ask if -- given the ongoing sale of PTSB, if this is an opportunity for you to gain market share organically in the country?

And then my second question would be if you could kindly provide the average cost of your digital accounts, which I think was 1.6% in Q3 and also the average duration of this, please?

Okay, Borja. I will answer you with regard to Ireland. Well, as I've mentioned, we are not interested in acquiring any operations in Ireland. But obviously, as I have always said, when there is a corporate transaction, there is noise, and this is always an opportunity for the other established banks in the country. We have seen that in the past in Spain. And I'm sure that, that will be the same in Ireland. So yes, this could be obviously an opportunity to acquire clients there.

And I pass the second question to Jacobo.

Borja, yes, there is -- the current price is -- the current average cost is 20 bps lower then I think you mentioned the 1.6%. So now we are at 1.4% more or less.

Our next question comes from Carlos from Caixa, BPI.

So the first one was actually -- first one would actually be on fees. You have -- in this quarter, in the other fees caption, you have a substantial increase quarter-on-quarter and year-on-year. I'm guessing that this relates to the roughly EUR 10 million success fee on a transaction that you had mentioned in the previous quarter. Just wondering whether you see scope for similar fees of this nature in 2026 and whether the high single-digit guidance that you conveyed is with -- on the reported fee income or adjusted for that specific item.

Then on -- well, you mentioned you expect ROTE to be above 20%. What type of net profit income growth are you expecting for 2026? Should we think about double digit or below that?

Carlos, regarding the guidance on fees that we mentioned, it includes -- I mean, we are not -- we are considering the total fees of 2025, and then, we are -- our guidance is on the top of it. So we are not excluding these one-off fees because the volume is not huge, it's not relevant for the entire year. So we are not considering -- I mean, it's like it was usual BAU.

And regarding the net income, I think we've provided enough guidance to provide you an idea of this increase. I mean, the level of efficiency is going to improve. Cost of risk is going to stay or even can perform a little bit even better. So yes, as you can imagine, the net income is going to grow. And again, it's going to be a new record year.

Our following question comes from Ignacio Cerezo from UBS.

One is a follow-up from Marta's question on the digital account growth. So how much of your mid-single-digit deposit growth is explained this year by digital accounts?

And the second one, I think, Jacobo, you mentioned that you're not expecting any impact from the banking tax in '26 and '27. So is that comment constraint to those 2 years? And that means that '28 onwards, you're going to start booking the levy actually in the P&L or you just wanted to constrain the comments actually to the next 2 years?

Ignacio, I will answer you the second one. Actually, the banking tax is a temporary tax. So it is not expected to go beyond '28. Obviously, that is what I can say today. I don't know if they will again extend this stack. So it is not -- it is temporary. And with the figures we have in hand, we think that it will be 0 or absolutely immaterial because we have a cash tax rate that is very high and that absorbs very comfortably the figure that comes out from the theoretical banking tax.

And I'll pass back to Jacobo for the first question.

Yes. Ignacio, I think the digital accounts have played a relevant role in 2025. But again, it's a combination of many things because the level of term deposit has gone down, which is very important. Treasury accounts has also had a very good behavior because our business or the growth in our corporate banking business has also been very, very positive. And of course, digital accounts had a quite relevance, but it's not the only catalyst of the growth of deposits during 2025. We've been able to attract the deposits. Then afterwards, we've been able to convert into 2 assets under management that have brought a lot of fees. Digital accounts are very important in our commercial strategy. That's what can I tell you, but it's not the only thing that we have. We have salary accounts that also have a very good behavior. So it's important, but it's not the only driver of growth in our deposit base.

Our next question comes from Sofie Peterzens from Goldman Sachs.

Sofie from Goldman Sachs. So just going back to the digital accounts, we have seen almost a tenfold increase in digital accounts. Like could you give us the split of the digital client acquisition by country? So how much is coming from Spain, how much from Portugal and how much is coming from Ireland?

And then my second question would be on the fee income side. When we look at the fee growth in Q4, which was very strong, we see a lot of the increase actually came from other fees, I believe around EUR 17 million quarter-on-quarter, which is almost a doubling quarter-on-quarter of this fee line. Could you just elaborate what that other fee income line includes?

Sofie, I will answer the first one. Almost 100% of the client acquisition with digital accounts is Spanish. It comes from Spanish clients. We have actually acquired digitally in Spain around 130,000 new clients, and we have attracted around EUR 5 billion of new money from these clients. This has allowed us to do something, which is actually not be -- not have -- we have made -- changed these deposits with corporate deposits that were even more expensive. So actually, we prefer to pay an acquisition cost to acquire clients where we can cross-sell and make more money than to our corporate clients for the treasury excesses. We won the operative accounts from our corporate clients, which are much lower cost.

But just to give you an idea, we have already cross-sell to these clients. It's very, very, very early to say, but we have already cross-sell payroll accounts. We have cross-sell lending, and we have cross-sell investment products. We are at around a 7% cross-sell. But another thing that I want to -- well, to say is that around 10% to 15% of these clients that we have acquired are in the maximum level of the digital account, which is EUR 100,000. And this means they are probably more in the affluent segment or the private banking segment, and we are going to concentrate on those clients where we see potential to develop them.

Actually, we are doing some tests to see in which area of the bank, whether it is the branch network, whether it is the telephonic managers or whether it is digitally that we can actually develop these clients. And for the moment, we are having quite good results.

I will pass you through to Jacobo to answer you the fee income question.

Good morning, Sofie. Yes, I mean the fee -- we have recorded the EUR 10 million of success fee of alternative investment funds in that line. That's why you see in the other fees that amount. I must say that the alternative investment funds activity is performing very well. You've seen also that in the line of the equity method, we have recorded very good results. And I believe this is something that is going to be sustainable over time. We have 31 vehicles. We have a good average fees. We have quite strong expectations in the future. And as we mentioned during the call, we have brought to the bank around EUR 10 billion of net new money, and some of them flies to the alternative investment fund. So this is a business that is quite relevant for us. It's going to be another priority in coming years. And you should expect more fees to come from this business and more equity method income from this business in the future. Thank you, Sofie.

Our last question comes from Britta Schmidt from Autonomous Research.

I have a question on the digital account. How should we think about the adjustment on the pricing of the stock and versus the flow? So maybe you can give us some sort of indication as to what basis point reduction in deposit cost you expect from this initiative?

And on the acquisition cost of these customers, I think given that you just explained that these are mainly affluent, it's probably clear why the acquisition cost will be lower than for other channels, but maybe you can give us some sort of quantification of how much lower these acquisition costs are?

Well, I will give you, for instance, the campaign where we acquired most was more successful this summer, summer in September, which was also after the acquisition of EVO. So it's really the digital organization. The acquisition cost was EUR 20 per client. So really, the acquisition cost is more the cost of the actual account. What we want to do is -- I mean, as you have seen, we have already reduced by 50 basis points every single account in the digital organization. And we will go on with this trying -- doing trials and reducing the cost. Obviously, the front -- so the front, the new production, the new acquisition, will have to be higher, and we will be always in the order of the reference, ECB reference rate or somewhere around there, obviously, depending on how the competition is behaving.

And the second question...

Thank you very much all for attending today. That has ended our Q&A. And on behalf of the entire Bankinter team, we definitely thank you for your interest and participation. As a reminder, the Investor Relations team will be available after the webcast to answer any questions that you may have. Thank you, and have a wonderful day and start to the new year.

Thank you very much. Goodbye.

Good morning to all, and thank you for joining this earnings call for the third quarter of 2025. Financial statements were posted with market authorities early this morning, and all materials can be found on our corporate website. Please refer to the disclaimer in this presentation and note that this call is being recorded.

Today, we are joined by our Chief Executive Officer, Gloria Ortiz; and Chief Financial Officer, Jacobo Diaz.

Thank you, Laurie. Good morning to all, and welcome to this third quarter 2025 results presentation. Since we last met in July, many things have happened. The tariff conflict between the European Union and the United States has been resolved. The Israel Gaza conflict seems for now to have reached its end. We learned the results of the BBVA Sabadell takeover bid last Thursday and interest rates have bottomed as the European Central Bank has ended rate cuts with inflation aligned with its targets.

Additionally, the EBA stress tests were published on August 1, in which Bankinter is again the listed bank in Spain as well as in the Eurozone with the lowest capital depletion in the hypothetical case of a very adverse economic scenario. We continue to navigate an uncertain and volatile environment. And despite this, I would like to highlight that this quarter's results remain satisfactory following the trend of the previous quarter with very relevant growth and activity across all business and geographies.

The third quarter has been another quarter with strong commercial activity translating into a post-tax result of EUR 812 million, 11% above the same period last year. These results are also accompanied by solid management ratios in terms of asset quality, efficiency, profitability and solvency. As reflected in the figures, we continue to report improving results in which, as usual, balanced and diversified growth is key. Credit and loans as well as retail deposits grew 5% with off-balance sheet balances up 20% year-on-year. Net interest income has continued to improve in the quarter.

In the second quarter, we reported a contraction of 5% that has been reduced to 3.5% in September. In fact, in quarterly terms, it is the second quarter that we have grown over the previous quarter, reaching levels of the third quarter of 2024. This is thanks to the resilience of the customer margin, which remains at 2.7% this year. On the other hand, fees and commissions continue to perform exceptionally well, maintaining a growth rate of 10.6% despite the fact that each quarter, the comparison with the previous year is more demanding. All this growth has been achieved while keeping our risk appetite intact, which is reflected in the NPL ratio that stands at 2.05%, improving previous quarter ratio as well as the one reported 12 months ago, which was 17 basis points higher.

Another key to our business model is efficiency, which stands at 36%, the best cost-to-income ratio in the sector. Diversified growth, asset quality and efficiency are the pillars on which the profitability of our business is based, maintaining a ROTE above 19%. As a result of intense commercial activity, we once again present strong diversified growth in business volumes this period. If we add credit and loans, retail deposits and off-balance sheet volumes, the volumes managed amount to EUR 234 billion at the end of September and grew by EUR 19 billion year-on-year. This is a remarkable growth rate of 9%.

Going into detail, lending reached EUR 83 billion at the end of the quarter, which is EUR 5 billion more than in September 2024. Retail deposits closed the quarter at EUR 85 billion, a figure EUR 4 billion higher than in the same period of the previous year. And finally, we added EUR 11 billion to the off-balance sheet business, which stands at EUR 66 billion, showing a strong growth of 20% year-on-year.

This year, we have seen a noticeable increase in new client acquisition, particularly through our digital channels. The integration of talent and technology from EVO Banco over the summer has assisted to further strengthen our digital strategy for the group. All geographies are growing at good pace. Spain, which accounts to 87% of business volumes grows 7%, while Portugal with 11% contribution to volumes grows by 12% and Ireland also stands out with 20% growth. New credit production also continues with improving trends as a result of the increased commercial activity. 16% in new mortgages, 6% growth in new business lending and a 3% drop in consumer credit due to the fact that we continue to reduce exposure to riskier segments.

On Page 7, for the past 12 months, we have seen increasingly positive trends in sector growth across the geographies in which we operate with close to 3% market growth in Spain, 7% in Portugal and 2% in Ireland. In each of these markets, we continue to gain market share in each of our business lines. In our core markets, Spain, the retail banking loan book increased by 3.4%, 30 bps above the market and our business banking book outperformed by 180 bps, reaching a 4.3% growth rate.

With both Bankinter Portugal and Ireland in expansion, we continue to gain significant market share, further diversifying our asset portfolio. Portugal grew 11%, 450 bps above the sector and Ireland, an exceptional 20% growth rate, well above market growth rates in both countries. In terms of revenues, there is a very notable performance of core revenues. This is the sum of net interest income and net fees and commissions, which has reached similar levels to those in the previous year. In quarterly terms, core revenues reached EUR 762 million, the largest in the series. And in fact, they are already growing both compared to the previous quarter by 1.3% and compared to the same quarter of 2024 by 2%.

This sustained solid performance quarter after quarter of fees and commissions growing at 10.6% compensates for over 90% of net interest income compression in the year due to the negative impact from the reduction of yield curves. Net interest income fell on a cumulative basis, 3.5%. But in quarterly terms, the upward trend continues. We are already 3% above the last quarter of the previous year and 5% more than in the first quarter, and we also grew 1% over the previous quarter.

Going now to the next page. I would like to talk about productivity. We have a scalable and efficient business that is reflected in productivity improvements. The volume of customers managed per employee expands year after year, while the cost per million euros of volumes managed decreases year-on-year. This is thanks to the investments made in technology and in particular, in artificial intelligence projects that are oriented to the improvement of personal activity, commercial efficiency, which relies mainly on algorithms, but also process efficiency and the improvement of the customer experience and the development also of new products.

Bankinter culture of applying targeted innovation across products, services and processes continues to deliver measurable results, reinforcing our strategic positioning and driving ongoing improvements in operational scalability.

I will now hand over to Jacobo, who will provide you with more additional detail and insights into our financial and commercial results.

Thank you very much, Gloria. Good morning, everybody. We are pleased to share once again another quarter growth and increased revenues and profitability. In operating income, we have grown by 4.7%, thanks to increased volumes, continued strong fee growth and effective margin management. We continue to rebalance operating costs more evenly over quarters with a year-on-year increase declining each quarter to end the year within our guidance. Cost of risk and related provisions declined by 10% compared to the prior year, reflecting a continued positive trend in risk management. Net profit rose 11% to EUR 812 million, gaining momentum to well surpass our initial goal of EUR 1 billion in 2025.

Let's move on to review additional details about each line in the following slides. So after the trough in the first quarter of this year, we continue to deliver quarter-on-quarter improvements in net interest income, now recovering levels of the third quarter of last year, reporting EUR 566 million, a 1% increase quarter-on-quarter. Asset yields continued to contract this quarter at 3.49%, down 22 basis points. This quarter reflects a typical low seasonality period where corporate banking activity is relatively lower compared to retail banking activity, which has influenced a bit of a mix change leading to a higher weight of repricing more in line with retail durations than the shorter corporate durations.

Given these dynamics and a stable outlook for Euribor 12 months rates, we believe average quarterly asset yields should drop marginally in Q4 to reach stability in the first half of 2026. Average customer margin for the year remained resilient at our 270 basis points, continuing to demonstrate our ability to effectively manage margins. With cost of deposits now at 84 basis points, a material 14 basis points decrease from last quarter, we are optimistic to reach levels around 75 basis points by the end of the year. Our NIM also remains resilient, a direct result of the effective balance sheet management.

After sharing the details of the NII results, we wanted to talk about the excellent results we have been seeing quarter-on-quarter related to our digital account strategy that we initiated last year as part of the new digital organization. This growing digital site account deposits in yellow in the graph on the left have aided in reducing and replacing typical long-term deposits with more granular and flexible shorter duration deposits. Between both digital site accounts and private banking or corporate treasury accounts, we now have a significant proportion of our deposits with less than a 3-month duration. This is less than half of the average duration of the term deposits.

Not only does this provide us greater agility to adjust deposit rates in line with market rates, but it also has a great source of increased customer activity, either transactional or through AUMs activity, driving additional fee volumes with a scalable operational model at a marginal lower servicing cost base. As you can see on the chart on the right, we have increased our average deposit spread over the past 4 quarters, reaching now close to 130 basis points. We believe these deposit spreads levels are likely to remain quite resilient, possibly with some upside for the coming years given the favorable rate environment as well as a more flexible deposit structure and our deposit gathering capability from our excellent existing and new customer base. Bear in mind that 50% of new customers are acquired through our 100% digital channels.

Fees continued to deliver sequential increases quarter-on-quarter even during the seasonally low summer months with an increase of 11% on a year-on-year basis, reaching EUR 196 million this quarter, up 2% on a quarter-on-quarter basis. This continued quarterly growth momentum is mainly attributable to the strong volume growth in fund management and brokerage services that we detail later in the presentation. We are quite optimistic to continue to maintain this growth momentum going forward, given our strong focus and strategy on affluent customer base and increasing flows from on-balance to off-balance sheet activity and customer-centric operating model.

It is also quite remarkable the performance of these business lines delivering improved results, notably in the equity method and dividend lines, up 29% on a year-on-year basis. The diversification of sources of revenue is well represented here given our diversified business investment over the past years in areas like our insurance JV partnership, our JV in Portugal with Sonae to deliver consumer finance products as well as our successful strategy with the Bankinter investment franchise, delivering alternative investment vehicles, allowing our customers to invest in real assets. This business line will continue to develop and deliver increased results over the coming years, providing upside risk in nontraditional revenue lines.

Regarding cost, we continue to reduce seasonality and balance our expenses over the year, increasing 3% when comparing average 25 quarterly cost to those in 2024. Although cost volumes may increase in Q4, they will be lower on a year-on-year basis when comparing to Q4 of 2024. cost-to-income ratio remains at an exceptionally low level of 36%, and will remain committed to maintaining positive operating jaws in the future.

On Page 17, loan loss provisions continue to show improvements versus last year with a cost of risk of 33 basis points. Other provisions also remained under control and performing well at a stable 8 basis points with no signs of deterioration in the market of our portfolio and with a well-managed risk management across the bank, we are optimistic to maintain current levels for the coming quarters.

Next page. Net profit achieved record levels once again, reaching EUR 812 million, an exceptional increase of 11% year-to-date.

Credit quality, credit and asset quality indicators continue to improve with the group NPL ratio dropping to 2.05%, down 17 basis points from last year. Spain down to 2.3%, Portugal at 1.4% and Ireland at 0.3%, all well below sector average.

Moving into capital. As Gloria mentioned, we are very pleased with our EBA's stress test results this quarter, resulting once again in the lowest level of capital depletion among all Spanish and Eurozone listed bank. Even under a severe economic adverse scenario, the potential capital depletion would only be 55 basis points. The prudent risk profile of our activity is differential. This has been a strong quarter for capital generation with the CET1 ratio at 12.94%, with a seasonal mix shift from corporate lending to increased retail lending, therefore, reducing RWA growth this quarter, which we review with the reverse in the following quarter with larger loan growth and density consumption and the annual operational risk capital consumption recorded in the fourth quarter.

As we continue to invest in technology and strategic projects, we have also seen an increase in intangibles this quarter due to the software-based solution under deployment, for example, with the new banking IT platform for Ireland or the Portuguese digital transformation program.

Moving into Page 22. Commercial activity and trends remain strong with customer volumes up 7% in Spain, 12% in Portugal and 20% in Ireland. Each region contributing at increased levels to the gross operating income of the bank.

On Page 23, loan growth, again, strong, up 4% year-on-year, growing both in retail as well as business lending. Retail deposits continued to demonstrate solid growth, increasing by 4% with also strong performance in Wealth Management, reflecting a 19% increase in assets under management, contributing to fee income increases of 11%. Profit before tax, up 6%, reflecting solid contribution for our core Spanish business. On Portugal, continued exceptional performance in lending activity across both business segments, up 11%, strong deposit gathering up 5% as well as increased wealth management and brokerage balances rising 23% on a year-on-year basis.

Moving into Ireland. Commercial momentum continues with mortgage loan growth up 23% as well as consumer finance loan growth by 11%. We have also launched our fully digital time deposit in the Irish market with an attractive value proposition that will surely grow deposit volumes over the coming quarters. Profit before tax contribution reached EUR 34 million with strong sequential increases in NII each quarter, up 16%.

Moving into corporate and SME banking. Business lending continued to deliver strong performance even with a seasonally low quarter in terms of new loans. Customer lending increased by 5%, well above sector loan growth. International business segment continues to be a key growth catalyst contributing to 1/3 of new credit production with a growth rate at 9% year-on-year.

Page 27, Retail Banking asset and deposit trends remain strong with increased new client acquisition driving core salary account balances up by 7%. New mortgage origination up 16% year-on-year with solid market share of new production in Portugal, Spain and Ireland at 6%. Our mortgage back book continues to grow by a strong 5% year-on-year, outperforming sector growth in every region.

Regarding Wealth Management, our high-quality customer base typically brings annual net inflows between EUR 5 billion to EUR 7 billion into the bank. However, this year, we have already surpassed this historical range and now reset our ambition to achieve between EUR 8 billion to EUR 10 billion of net new money every year. When taking into consideration the market effect as well, incremental wealth of our customers increased by EUR 20 million or a 16% increase on a year-on-year basis.

Moving into off-balance sheet volumes. We continue to grow in assets under management and assets under custody, reaching now EUR 150 billion with assets under management advisory or customer direct execution services in brokerage. Since our differentiation strategy centers around the client and how they prefer to interact with the bank rather than a product strategy, we indistinctively offer Bankinter products as well as third-party products to retain independence in terms of customer advisory services. With a full range of products as well as various servicing models based on customers' preference, we are able to consistently grow these off-balance sheet volumes, a key driver of continued fee growth quarter after quarter.

And finally, let me recap our ambitions and targets. Given our solid third quarter financial results, a strong commercial momentum and volume growth trends and with a stable outlook for Euribor 12 months over the coming year around 220%, we remain optimistic in terms of future growth potential. In terms of our specific ambitions for this current year, loan volumes are expected to continue to grow at mid-single-digit rate, similar than deposits with assets under management commercial activity following the same strong performance than previous quarters.

As market conditions become more favorable, we are committed to maintaining 2025 average customer margins around 270 basis points to support robust profitability that surpasses our cost of capital. In essence, we will not compromise margin integrity. Regarding NII, we anticipate that the final phase of retail repricing will take place mostly in Q4 and with much lower impact in the beginning of '26. Consequently, while some pressure on asset yields is expected to persist, it should moderate as our corporate portfolio has now been fully repriced in Q3.

On the deposit side, we will continue to reduce and manage costs in a balanced manner to support ongoing customer and deposit growth, particularly in the digital site accounts. As a result, we expect a more modest reduction in deposit costs in Q4 compared to Q3 between the range of 5 to 10 basis points. Given these dynamics and our current commercial strategy, NII in Q4 will keep growing quarter-on-quarter again and growing year-on-year again, which may result anyway in a slight slippage in our flattish NII guidance in 2025 that will be compensated by a stronger fee growth. With upside risk in fees, we increased our targets of high single-digit growth target to reach now double-digit growth in fees.

With respect to cost management, we continue to allocate and balance cost volumes over the quarters and remain on target for 2025 full year annual cost to grow mid-single digit. We also remain committed to delivering positive operating jaws in 2025, gross revenues above cost. As credit quality continues to improve, we are revising our targets with the expectation of cost of risk to fall below 35 basis points for the entire year. Although we do not provide guidance for the following year until the results presentation in January, we must say that as of today, with the current macro outlook for Spain, Portugal and Ireland, there is no reason why we should not expect similar levels of growth in our loan book as well as resilient client margin in our levels of cost of risk.

Efficiency will also remain at the top of our agenda to ensure sustainable levels of return on equity in 2026 and so on. And capital levels are expected to stay strong in coming quarters despite profitable growth expectation. I believe that this has been another high-quality set of results with no surprises, one-offs or extraordinary items, quite predictable that make us feel to be on track to achieve another excellent year in 2026.

Gloria, back to you for any closing comments.

Thank you, Jacobo. Well, as you can see, the results of these first 9 months of the year have once again beaten records of previous years with an 11% growth in net profit, and all this is accompanied by an excellent level of operational efficiency and asset quality, both ratios improving compared to the previous year. All this allows us to continue improving returns on capital, which stands at 18.2%, 30 bps better than in 2024 and continues generating value for our shareholders, both in terms of dividend distribution and the book value of shares.

To close the presentation of results for the first 9 months of the year, I would like to highlight that we are once again presenting solid results because of the recurring activity with our customers and the execution of a consistent long-term growth strategy. We are growing steadily in all the businesses and geographies in which we operate, keeping our risk appetite intact, even improving the risk profile of the loan portfolio as reflected in the NPL ratio and the increase in the coverage of the nonperforming loan portfolio. We continue to invest in projects and initiatives that allow us to keep pace with business growth. And despite this, we improved efficiency. All this results delivering a sustained return on the capital of the business, well above the cost of capital. For my part, this is all.

Thank you again very much for your attention, and I will pass now on to Laurie.

Thank you very much, Gloria. Thank you, Jacobo. Let's now move on to the live Q&A session, please.

[Operator Instructions]

Our first caller is Francisco Riquel from Alantra.

My first question is about the fast growth in digital accounts. It's 4x bigger year-on-year. So I wonder if you can comment on the cost of these digital accounts compared to your total cost of deposits and the alternative of time deposits where you are switching. And I wonder if you can also elaborate on the commercial experience with these online customers and cross-selling ratios. You are not exceeding your traditional mid-single-digit growth in loans and deposits. You are growing faster in AUMs, but I wonder if this is coming from these online clients or from your traditional affluent and high net worth clients.

And then my second question is about loan growth in Spain, which has slowed down year-on-year a bit, particularly in higher-margin corporates from 6% in Q2 to 4% in Q3. The sector has not. They're still growing by 3% in lower margin retail mortgages. So I wonder if you can comment on competition dynamics and update in terms of loan growth and also in the loan yield, where do you see the trough of this interest rate cycle?

Regarding the loan growth, I think we had another, I think, good quarter comparing year-on-year in terms of the loan book. As I mentioned, the seasonality of the third quarter is -- I mean, typical in Spain, it has a negative seasonality. And the corporate banking activity has been lower as we normally expect. So we do not have any sign of slowing down in that perspective. It's just a matter of seasonality. In fact, we keep expecting similar levels of growth at the end of the year compared to, I don't know, previous quarters. So basically, we do not expect any changes. You mentioned competition. Of course, there is competition in the corporate banking as well in the mortgage activity, but this has been always the case. So there's nothing special to highlight. I would say that the loan growth will continue to show strong results.

And regarding the digital accounts, definitely, digital accounts have been a quite relevant strategic commercial move for us in the past months and quarters. So we are delivering excellent results. We are capturing quite large volumes of deposits. We are cross-selling, of course, as you can imagine, plenty of different types of products. I wouldn't say that the largest volumes of AUMs are coming from the new digital accounts because it takes some time to transform and to cross-sell this type of accounts. But definitely, we are quite happy.

You were mentioning about the cost. The thing is that these digital accounts have a quite short duration and for us is -- we have the agility and the capacity to change prices within a quarter. So for us, from a commercial strategy, we're quite happy.

I will add 2 things. I mean the average cost of the digital accounts at present is around 1.6%. Actually, as Jacobo has said, the duration is around 2 months. So -- and we manage centrally, which is different to when it's products that are managed by the branch network, we manage centrally new prices. So it is quite easy and fast to reduce the cost. But on top of this, what I want to mention is that what we have been doing is a substitution effect. So basically, these deposits have been substituting higher tickets from enterprises and corporates. And there has been a reduction in the cost because we have been substituting higher costlier deposits.

As Jacobo has said, I mean, looking forward, we expect the cost of funds to retail funds to continue reducing next quarter -- sorry, this quarter and in the order of 5 to 10 bps depending on where the Euribor stands. With respect to competition, here, yes, we have been growing quite nicely in mortgages in Spain so far. But I have to say that the competition is starting to be a little bit irrational, particularly in fixed rate mortgages of long term like 30 years. So you can expect us to be a little bit less active in that segment, although we think that we will continue to grow.

Let's move on to our next question. Our next question comes from Borja Ramirez from Citi.

I have 2. Firstly is on the NII, if I were to base the Q4 NII of this year and multiply by 4 and add the loan growth, would this make sense from a technical point of view to -- for estimating the 2026 NII? Or would there be any other moving parts?

And then my second question would be in Ireland. I think you -- according to press, you launched a deposit of 2.6% rate, if I am correct. I would like to ask if you could provide some details on the growth strategy in Ireland in deposits.

Regarding Ireland, I mean, what we are doing is just a test for the moment. So it's a friends and family. We are offering this deposit only to our clients and only a certain amount. I mean, initially, we are talking about EUR 50 million. So this is like a welcome deposit, and it's not going to have any impact at all in this year NII, and I don't think in next year either because we are controlling, as you can imagine, the growth in these deposits. With regard to NII, multiplying by 4. Well, it's a little simplistic. It could be near it could be near if Euribor rates stay completely stable around the year. It will be probably better than that than the mere multiplication by 4.

Yes. I think our assumptions are we keep, as we mentioned, estimating that the average -- the client margin for coming quarters should be around 270 basis points and that we will continue to grow in similar -- the similar path that we've been growing in the past quarters. So that will be the main assumptions that you should take into consideration. As Gloria was mentioning, it's not just multiplying by 4. We definitely think it could be a little bit higher than that.

Our next question comes from Ignacio Ulargui from BNP Paribas.

Just wanted to get a bit of a sense on the capital performance of the quarter, what you just -- Jacobo flagged about reverting the effect of the mix in the quarter in the coming quarters. I mean still 12.9% looks to me like a very high level. Is there any chance that the bank considers changing the 50% payout ratio with the current trend of capital?

Second one is on costs. You said in the guidance, if I hear correctly, mid-single-digit growth. Should we expect a slightly more acceleration given the good performance of revenues that you front out a bit of cost for '26 in the fourth quarter beyond the natural seasonality that you have been trying to smooth this year? Or that would be -- or you're going to be very focused in keeping the costs on that limit to avoid slippage in '25?

Ignacio, regarding the capital performance, as I mentioned, we present a quite strong capital ratio this quarter. And I did mention that there is some seasonality impact in this figure. So for the fourth quarter, we do expect a growth or much larger capital consumption from the growth, especially from the corporate banking activity that tends to be quite strong at the end of the year and of course, growth in the retail business and in other geographies as we have done.

And additionally, I mentioned that there are some special recordings in the fourth quarter from capital consumption as the operational risk is fully recorded in the fourth quarter. So we do expect a figure probably lower than this one that we have shared today with you, although the results for the fourth quarter are going to be, again, very, very strong. To this means are we -- do we have in mind changing our dividend policy? I would say not for the time being. But of course, if we will see these trends in coming quarters, of course, we will -- we might think about doing whatever in terms of keeping our capital ratio in levels where we feel comfortable.

Ignacio, with regard to cost, I mean, we are very comfortable with the low mid-single-digit growth, and we will stick to this. I mean we don't see any reason why we cannot meet our target.

Our next question comes from Carlos Peixoto from CaixaBank BPI.

Carlos Peixoto from CaixaBank here. A couple of follow-up questions actually as well. So mostly on NII. So if I understood correctly, you're expecting to see some pressure on asset yields coming through still in the fourth quarter through the repricing mechanism. Then you mentioned deposit costs maintaining roughly the spread to Euribor. And I guess that some volume growth, as you mentioned, fourth quarter tends to be much stronger.

So putting all of this together, do you see enough support for NII in the fourth quarter to do materially better than in the third Q? And as you mentioned in the call, to see some -- well, basically that you won't be reaching the stable NII guidance, but I was just wondering whether we could be talking about a small single-digit decline in NII or closer to mid-single digit.

Carlos, we did mention that the cost of deposit in the -- we are expecting next quarter to continue to decline, probably at a lower speed that we saw in previous quarter. And we mentioned somewhere between 5 to 10 basis points decline in the coming quarter. But we also -- we mentioned that we are -- we have come to a much lower speed of loan yield repricing, and we do expect some sort of stabilization or a slight reduction in the fourth quarter. That will mean that we do expect client margin to recover, and we are quite strong optimistic in terms of we will have a good -- at the end of the day, a good final quarter. But indeed, like you mentioned that -- and I did mention there might be a slight or minimum slippage in the overall flattish guidance.

But again, it's going to be much more than compensated with fees. So we are good -- I mean, we are quite well optimistic about what's going to happen in the fourth quarter. So there is full repricing in corporate that has already been achieved in the third quarter. Euribor 12 months is behaving quite well around 220. There is a little bit more repricing from the mortgage book in the fourth quarter to come. But again, there is a strong seasonality that we believe will make a good fourth quarter to end up the year.

As I mentioned, the fourth quarter is going to be again higher than the third quarter and much higher than the same quarter 1 year ago. So we think we are optimistic about the fourth quarter of this year. And of course, the coming quarters in 2026. We think this 270 client margin is something that we -- is definitely our ambition, and we are definitely managing everything in order to achieve that figure.

Our next question comes from Ignacio Cerezo from UBS.

I've got one on the international credit book, which is around 30%, 35% of the total corporate lending book and seems to be growing much faster basically than domestic. So if you can give us some information, some color basically of what is in there and what is the reason is growing faster and what kind of sustainability you see on that?

And kind of related to this more on a system basis, from a mortgage growth point of view in Spain, obviously, housing prices going up very fast. It doesn't feel that the shortfall of housing is going to be corrected anytime soon. I mean, is there any risk that the demand actually ends up drying up faster because of, I mean, problems of affordability, I mean, difficulties from people to access housing, et cetera. Do you think actually the pickup of mortgage growth we are seeing in the last year or so has less or there's a risk actually that drives up into the next, say, 6 to 12 months?

Ignacio, with regard to mortgages, we don't see changes in demand in the very -- in the short term, so this year or next year. It is true what you're saying that prices go up and up and that there could start to be -- particularly in medium salaries, there could be problems of affordability. There are measures like the ICO lines where we are being active. Obviously, we have a little bit more than our market share that basically are trying to tackle this problem because they cover up to 100% of the value of the property.

So what we are seeing in mortgages rather is what I've mentioned, which is a competition that is not being very reasonable with regard to long-term fixed rates. And basically, we are not going to enter that war, particularly in those clients. Well, in our clients, we might do because if we know how profitable their relationship with them is okay, but it won't be a measure to acquire new clients definitely. I think that's for mortgages.

Ignacio, I'll take your question on international credit book. I think basically, our corporate banking Spanish clients are much more international than they used to be. They're much more focused on going abroad. And we do provide a quite large menu of products and services with a good technology, et cetera. So we are developing more technology, more, I don't know, supply chain management products, working capital facilities, endorsements, et cetera. So since we have increased our range of products and services to this type of clients, then the volume of activity and the loans and off-balance sheet items are keep growing and growing.

So this is some sort of sustainable. This is something that we do expect to keep growing at the same -- at similar levels. So no one-offs in here is quite recurrent. And this is for us a quite relevant source of revenues, in terms of NII, in terms of fees, and it's a quite profitable business.

Our next question comes from Alvaro Serrano from Morgan Stanley.

I just wanted to follow up on the loan growth. I take the seasonality and one thing, I just was curious, I wanted to double-click on your comments around derisking and the consumer book being down, I think you said 3% quarter-on-quarter. Where are you derisking? What kind of product, what region? And is it a one-off thing? And what should we be looking for in consumer going forward from here in terms of volume growth?

And then the second sort of follow-up question to the broader discussion in the call is, how do you think the pricing dynamics in the mortgage, in particular, is going to evolve over the next few quarters? Are you seeing the market being less bad? If it stays as competitive as it is, what's the end game for you in the mortgage market in Spain?

Alvaro, with regard to the portfolios where we are derisking, it is mainly open market consumer credit in Spain. So we are basically reducing our exposure and reducing also the new production and being more selective. That is on one hand. This portfolio anyway is not very significant in our overall book. And we continue to grow in consumer credit, but in our own clients in Spain and also in Portugal and in open markets, both in Ireland and in Portugal with Universo, the JV we have with Sonae.

With regard to mortgages, well, for the moment, we are not seeing any changes in the pricing dynamics. But hopefully, we will be getting to prices where we have some margin with respect to the swap curve. But for the moment, that is not the case. That is why I was mentioning that we will probably decelerate growth, not so much in mortgages with our clients, but rather in the acquisition of new clients with mortgages.

Our next question comes from Maks Mishyn from JB Capital.

Two questions from me, please. The first one is on your Wealth Management business. Press reported several hirings you did. What kind of AUM growth should we think of for Bankinter in the medium term? And does this mean that fees are also likely to grow above the mid-single digits we have seen historically?

And the second question is on capital, a follow-up on what the comfortable level is for you? And if the growth is not there, how can we think of deploying this capital?

Maks, I mean, definitely, the current levels of growth in the Wealth Management business is something that we believe are sustainable. Of course, there are market effects that are not controlled. And this is something we cannot control, neither estimate. But the capacity to keep bringing net new money to the bank, as we've mentioned in the call, is becoming higher and higher. So now our estimation has increased from EUR 5 billion to EUR 7 billion every year to EUR 8 billion to EUR 10 billion every year. And that, of course, means that has an impact on fees.

So definitely, we don't know exactly what's going to be the level of fees in -- the recurrent level of fees in the future, but we definitely think it's going to be quite strong and probably stronger that your -- I think you mentioned mid-single digit. So for us, again, the combination of our strategy in commercial activity has a full link in the Wealth Management activity and, of course, in fees. So...

With respect to capital, I mean, we feel comfortable with a level in the -- between 12 40, 12 60, something that can give us room to continue growing and that doesn't restrict that growth. So this is more or less the average level where we are comfortable.

Our next question comes from Pablo de la Torre from RBC Capital Markets.

Just a follow-up on Ireland on previous comments from Jacobo, you've mentioned the fixed-term deposit proposition in the country. But can you please remind us on the broader ambitions? And what are the next steps in the product road map in the country? And I guess in particular, you mentioned today your new higher ambition around net new money growth. So I was wondering if you were planning to start offering wealth products in Ireland next year.

Maybe if I can squeeze in another follow-up on capital. Given your excess capital position and given also current valuation levels, can you just kind of update us on your appetite for inorganic growth from now?

Pablo, regarding Ireland, definitely, the first phase is through the launch of the term deposit that we've mentioned before. Our next ambition is going to be the launch of current accounts at the beginning of 2026. And I think this is going to be the great moment of funding the growth that we are expecting in Ireland with deposits from local in Ireland. So we are targeting to fund whatever growth we have in the loan book in Ireland with the deposit book in Ireland as well. So this is the ambition, and this is the next step. We are not considering for the time being to move into the Wealth Management business in Ireland. I think we have plenty of things to capture and to target before that business.

And with respect to inorganic growth, well, our appetite is very, very low. As you can imagine, we are an organic grower. We have always grown organically in the different businesses and geographies where we have the capabilities, and this is what we are doing in Ireland, and this is what we will continue to do in the future.

Our next question comes from Britta Schmidt from Autonomous.

I have a follow-up on the consumer exposure, the open market consumer exposure in Spain that you talked about. Could you share with us the volume of that book and what the driver was for the derisking? I mean, have you seen a material change in the cost of risk there? And if so, why?

And then on the -- you mentioned the operational risk impact in Q4. I mean, would it be reasonable to assume that it could be up to 20 basis points? Or do you expect something less than that?

I will answer the consumer credit exposure. This is a very small book. It's like around EUR 1.3 billion. Not all of it is being derisking. The reason mainly here is not the cost of risk, it's an ROE question. So basically, we think there are better businesses where we can allocate our capital, and this is why we have decided to reduce our exposure in this book.

Britta, regarding the operational risk, of course, we don't know the figure right now. As you know, the rules have also changed with Basel IV. So it's probably a little bit ambition for me to give you a good estimation. But it could be somewhere between 10% and 30%. So probably your 20% might be in the middle.

Our next question comes from Hugo Cruz from KBW.

I wanted to ask you about fee growth. If you could give a bit more guidance. I think before your guidance didn't assume any performance fees, which you had a lot of them in Q4. So the new guidance of double-digit growth year-on-year, does that include performance fees as well or not?

And the second question on the cost of risk. You've improved your guidance a few times this year. The guidance for this year is below what you did in the previous 2 years. And then if we have a bit of slowdown in resi mortgages, does that mean the cost of risk next year could be higher than this year? Your thoughts on that would be very helpful.

Hugo, regarding the fee growth, I think we -- as of today, we are already at the double-digit growth. So just basically, we do expect to continue growing at a similar path that we've done in the past quarters. We don't know yet if there's going to be any success fee. That's why we are not included -- we are not including success fees in those estimations because honestly, we don't know it yet. And regarding cost of risk, I think what we mentioned is that we are expecting to end the year with a cost of risk below 35 basis points. We are currently around 33 basis points as we shared in the presentation.

We don't think that next year is going to be a higher figure. There is no reason why we should say that because what we're seeing is that there is quite stable situation. So we are very comfortable with the current situation of cost of risk. We are not perceiving any changes in the levels of delinquency, et cetera. And in fact, as Gloria was mentioning, we are reducing the exposure to some businesses with higher level of risk. So for the next year, we do not expect an increase in the estimation of cost of risk.

Our next question comes from Fernando Gil de Santivañes from Intesa.

Two quick follow-ups, please. Regarding fees, I mean, there has been one transaction in Q3 regarding the renewables, similar to the one you did in the past, but you have not accounted it in Q3. Can you please guide us when this transaction and if there is any potential positive one-off coming in Q4? And is that included in the guidance? This is one.

The second one is on costs. In the second quarter, you have the headcount down marginally, but down. Has this anything to do with the growth profile that you have been flagging during this call?

I will answer the fees. Yes, this quarter, we have made a transaction, the sale of a portfolio of renewables. And we have not accounted for the success fees of this transaction so far because obviously, the contract has to -- how to say -- we have to close the contract exactly. So anyway, the fees that we're talking about are not material. It will be less than EUR 10 million or even a little bit less. So it is not something that is going to move the arrow.

With respect to costs and the headcount, we are reducing the headcount in Spain, and we are doing that for several reasons. The first is that we are investing quite heavily in artificial intelligence, and this is allowing us not to replace the employees that go from the bank either voluntarily mainly. And I remind you that we have absorbed EVO Banco this year, and this means that we have 200 more employees Bankinter Spain, and that was enough to absorb the growth in -- needed in the headcount for the year. But anyway, I think that with respect to the headcount, you can expect the headcount in Spain to remain very stable next year or even to reduce a little bit because of all these investments we are making in artificial intelligence.

Thank you. That ends our Q&A session. I would like to thank you on behalf of the entire Bankinter team, and Felipe and I will be there to support you for any questions post the webcast. Thank you all, and have a wonderful day.

Good afternoon, and thank you for joining this earnings presentation call for the first half of 2025. Financial statements were posted with market authorities earlier this morning. All materials can be found on our corporate website as well. Please refer to the disclaimer in the presentation and note that this call is being recorded.

Today, we are joined by our Chief Executive Officer, Gloria Ortiz; and our Chief Financial Officer, Jacobo Diaz.

Before handing over to Gloria, I'd like to mention that Bankinter is celebrating its 60th anniversary, marked by innovation, business diversification and steady organic growth, as illustrated on the cover page in the timeline we've included.

Thank you very much, and over to you, Gloria.

Good afternoon. I appreciate Laurie highlighting our 60th anniversary since our continued focus and adherence to our core values over the past 6 decades have been fundamental to our success, which stems from a strategy focused on innovation, excellent customer service and effective technology use, topics I will expand on later.

Let's start on Page 5 with the key highlights for the first 6 months of the year. 2025 continues to be marked by accelerated growth and resilient margins. Commercial activity demonstrates positive momentum as overall customer volumes have increased by 9% compared to the previous year. We see solid trends in customer lending activity balanced with retail deposit growth and an exceptional wealth management dynamics with assets under management increasing by 18%.

Our business margins have remained strong, supported by ongoing balance sheet growth and effective management of deposit costs in alignment with asset yields. Gross revenues rose 6% this semester despite lower NII, which reached its inflection point in Q1 and Q-on-Q has now increased by 4%.

Fee income continues to be an integral contributed to growth with 11% increase. Our key management ratios remain best in class due to the strict cost control and prudent underwriting, both crucial for sustained profitability across any economic cycle. We reported a net profit of EUR 542 million with return on tangible equity surpassing 19%.

The following pages examine several key factors that have contributed to these results. Starting with volumes on Page 6. Our differentiation strategy continues to drive diversified volume growth across each category, geography and products. Customer volumes increased in total by EUR 19 billion this past year, reaching EUR 231 billion. When including the volume of assets under custody, either equity or fixed income with our retail and institutional clients, total volumes exceed EUR 300 billion.

Customer volumes in our core market in Spain grew high single digits, 8%, with Portugal and Ireland both achieving double-digit growth, Portugal 15% and Ireland 20%. Looking at asset origination trends, on the right-hand side of the slide, new mortgage origination is up by more than 20%, corporate and SME banking increased by 15%, and a drop in new customer finance origination specifically in Spain where we made the conscious decision last year to reduce origination in what we refer to as pure open market.

Moving to the next page. Net interest income increased this quarter by 4%, passing the inflection point in Q1 and delivering an increase even above fourth quarter of 2024. Gross operating income increased by an impressive 6%, supported by strong fleet growth. With core revenue stabilizing and strong fee growth, we remain confident in achieving our revenue targets for this year.

On Page 8, prior to moving to the final page in this section, I would like to take a moment to share a few of our digital transformation priorities as well as the tangible impact these initiatives are having on improving our efficiency and productivity metrics.

Bankinter has a long-standing commitment to technological innovation. We are focused on artificial intelligence and cloud initiatives, having implemented over 20 new generative artificial intelligence cases in customer management, internal commercial productivity and back-office operations. With our new cloud platform deployment, we have enhanced our capabilities currently running over 100 AI and advanced analytical models in production. This approach enables us to reduce processing times, store larger sources of data and improve scalability to support future business growth.

IT investment also supports our strategic commitments as seen in the EVO merger and integration of its IT systems into Bankinter, laying the groundwork for the expansion of Bankinter's new digital organization achieving greater economies of scale.

Most importantly, an analysis of productivity and efficiency trends indicate that our targeted IT investments yield positive outcomes. We observed an increase in volume managed per employee in the graph on the left as well as a reduction in unit operating costs, enabling [ future growth ], maintaining our industry-leading cost-to-income ratio.

To close this section of the presentation, I would like to reaffirm our commitment to leading the industry in cost-to-income ratios and maintaining excellent asset quality levels. Both are strongly associated with maintaining high profitability levels across different economic cycles and have been key contributors to achieving ROTE exceeding 19% and an ROE above 18%, placing Bankinter in the top quartile of our European peers.

I will now hand over to Jacobo to review the financial and business performance.

Thank you, Gloria. Good afternoon, everyone. We are quite pleased with our first half results, once again delivering growth and profitability, achieving a 6% increase in gross operating income driven by higher volumes in all businesses and geographies, increased fees and effective margin management despite the falling rate environment.

As stated earlier this year, we are now distributing operating costs more evenly over quarters. The current year-on-year increase should decline in coming quarters as quarterly cost volumes remain stable. Cost of risk and related provisions declined by 10% compared to the prior year, reflecting the continued positive trend in losses. Net profit rose 14% to EUR 542 million, supporting our goal to exceed EUR 1 billion in 2025.

In the following slides, I will provide additional details about each line. On Page 12, net interest income reached its trough in the first quarter of 2025 and now recovering above the fourth quarter of 2024 levels to reach EUR 560 million this quarter. This upward trend in NII has been achieved despite a 140 basis points decline in Euribor on average during the first 6 months compared to the average for the same period in 2024. Asset yields are still in decline with this quarter's average at 3.71%, down 24 basis points from last quarter after a 30 basis points drop in Euribor between March and April. Customer margin remains above our 270 basis point target, demonstrating effective management of deposit costs, which dropped 23 basis points this quarter. This now brings down the average cost of deposits below 1%, and we expect this trend to continue targeting to end the year below 80 basis points.

Deposit costs declined this quarter due to lower front book pricing, a deposit mix shift reduction over 5% and higher proportion and repricing of our digital deposit accounts, which led to decreased site account costs. Our NIM remains above 180 basis points as a result of effective balance sheet management, lower wholesale funding costs and an expanding ALCO portfolio.

On Slide 13, we present our ALCO portfolio, which has increased to EUR 14.7 billion as we continue to leverage a steeper yield curve while remaining with prudent levels relative to our balance sheet size and equity size.

Let's move into fees on Slide 24 (sic) [ 14 ] Fees increased by more than 11% on a year-on-year basis reaching EUR 380 million this quarter, up 2% on a quarter-on-quarter basis. We continue to achieve exceptionally strong results in fund management and brokerage services increasing by 13%, now representing more than 50% of total gross fees.

On Page 15, improved results in the trading dividend and equity method lines. However, the most significant factor this year has been the lack of any banking tax charge that we announced already last quarter.

On operating expenses, as we work to further minimize the seasonality of our expenses, we also maintain rigorous control of costs across the group. Quarter-on-quarter volumes have remained stable, reflecting a 2% increase compared to the average quarterly cost in 2024. Cost-to-income ratio remains at an exceptionally low level of 36%, remain committed to maintaining positive operating jaws this year.

On the following page, you can find an overview of the distribution of costs by geography and by category. And on Page 18, loan loss provisions continued to decrease, leading to a cost of risk of 32 basis points. Other provisions also remain under control and performing well, down to 8 basis points this period. Net profit of this quarter totaled EUR 272 million comparable to the quarterly high record last year. These results contributed to a solid first half of 2025.

Regarding credit quality, credit and asset quality indicators remained strong with an NPL ratio of 2.14% overall, Spain at 2.5%, Portugal at 1.3% and Iran at 0.3%, all well below sector averages. We also continue to strengthen coverage ratio, reaching an unprecedented high of 70%.

On liquidity, loan-to-deposit ratio increasing slightly to 97% this quarter. And capital, at the close of the quarter, our CET1 ratio stood at 12.57%. During this period, we consolidated a gain of 59 basis points in retained earnings and allocate 34 basis points to our risk-weighted assets growth, resulting in a net organic increase of 25 basis points. Valuation adjustments increased 13 basis points, mainly from our financial investments in Linea Directa and the ALCO portfolio.

Let's move on to review the performance across each region and business segment. Commercial momentum remained strong, with customer volumes up 8% in Spain, 15% in Portugal and 20% in Ireland. On Page 25, in Spain, loan growth remains strong, increasing 4% to EUR 68 billion, growing both in corporate and retail loans. Retail deposits also demonstrated solid growth, increasing by 5%.

The strong performance in wealth management reflected by a 15% increase in assets under management and assets under custody resulted in a notable 12% rise in fee income. Profit before tax rose 8%, reflecting robust returns and solid income from our core Spanish business.

On Page 26, Portugal delivered exceptional volume growth in lending, up 11% as well as deposits up 20%. Assets under management and assets under custody also continued to grow up 13%. Moving to Ireland, we continue to see excellent commercial momentum in asset growth in mortgages, up 22% as well as in our commercial financial activity growing 13%.

In terms of financial, profit reached EUR 21 million, with a strong increase in NII, up 15% this year. The corporate and SME segment continues to demonstrate robust performance with customer lending increasing by 6%, which is twice the sector growth rate in Spain. The international business remains a key growth catalyst growing currently at 14%.

Regarding wealth management on Page 29, the management of customer wealth in both retail and private banking businesses continues to be a key driver in deposit gathering as well as investment fund inflows and securities trading, all supporting a strong fee income growth.

Given our high-quality customer base, we typically see an annual increase between 5 billion to 7 billion of net new money into the bank after just 6 months this year, we have already -- we are near the lower limit of this range and very optimistic about reaching or surpassing the upper limit by year-end. Including this year's market effect, our private and retail banking division saw a EUR 9 billion increase in wealth with total assets rising 13% or EUR 16 billion year-on-year.

On Page 30, continue with retail banking trends. Commercial activity remains strong with increased new client acquisition growing by 7% in our insignia salary and digital accounts, an accelerated mortgage origination up 21% year-on-year, growing each quarter with solid market shares of new production in Portugal, Spain and Ireland at 6%. The mortgage back book grew by a strong 6% year-on-year, outperforming sector growth in every region.

To conclude this section on Page 31. Our focus on a niche high-quality client base has enabled us to maintain double-digit growth in assets under management across proprietary and third-party funds, pension plans and alternative investment vehicles. Another key source of recurring fees in our wealth management business is assets under custody, which have grown by EUR 80 billion across retail, private and institutional clients.

So let's move to some closing remarks. After considering these results, I want to revisit our ambitious -- or ambitions for this year. Regarding loan volumes, we anticipate growth across all regions and business segments in line with current trends, maintaining, therefore, our ambition of a mid-single-digit growth. Regarding NII, since May, Euribor rates have stabilized above 2%.

Despite declines in these rates during the first month of the year, we effectively managed deposit costs and achieved NII growth this quarter. The expectation is to achieve flattish NII in 2025. Our current assumption is that we will end the year with 12 months Euribor above 2% --, slightly above 2%, and we remain confident in our ability to manage customer margins close to 2.7%, as we have done up to date.

We continue with a positive outlook regarding fee income trends, and we target high single-digit growth for the year. We continue to distribute and balance cost volumes over the quarters, and we target full year annual cost to grow between low to mid-single digits.

Since we expect revenue growth to exceed cost growth, we aim to deliver positive operating jaws in 2025. Given this year's improvement in credit quality, we now expect cost of risk for the full year to be 35 basis points. And finally, we remain committed to surpassing EUR 1 billion in net income in 2025.

So Gloria, back to you for any closing comments.

Thank you, Jacobo. Our results are strong and consistent with our plans. We are optimistic as growth accelerates across our markets and segments. Our high-quality customer base, differential business model, positive macro environment and exceptional teams give me confidence in our ability to navigate global uncertainty and maintain margins. Looking ahead, our continued focus on organic growth and diversification remains essential to achieving our long-term objectives. The value created over time for the bank's shareholders is both distributed and strategically, we invested in initiatives that support sustainable and profitable growth, thereby compounding the value of Bankinter over time.

Typically, we project key KPIs from Page 35 during our Q&A session. However, on this occasion, I would like to move to a slide commemorating our 60th anniversary, celebrating 6 decades of profitable growth and extend my sincere appreciation to our clients, shareholders and both current and former employees who have supported us throughout this journey. For 60 years, what we call the Bankinter way has remained a constant, and I am proud of our past achievements and look forward to continued success.

Well, Laurie, let's move now to the Q&A.

Thank you both, Gloria and Jacobo. Let's now move on to the live Q&A session, please. [Operator Instructions]

The first call on the phone we have is Maks Mishyn from JB Capital. Maks, please go ahead.

Year-to-date, you are growing 11%. Is there any reason to not improve guidance for the full year? And also, what was the reason for a quarter-on-quarter decline in AUM fees?

And the second one is on M&A. There was -- there were some news in the Spanish press on your potential plans for M&A. Any chance you could give us more color on your thoughts on this?

Sorry, Maks, could you repeat the first question? I missed the beginning.

Yes. Sure, Jacobo. It's -- year-to-date, your fees are growing 11% and your guidance is high single digits. So I was just wondering is there any reason for them to slow down in the coming quarters? And also why there was a quarter-on-quarter decline in AUM fees?

Okay. Thank you, Maks. I got it. So I mean, basically, we are targeting a high single digit for the end of the year in fees, and it's basically because last year, in the fourth quarter, we had some success fee that normally tends to be one-offs.

So that's why this is the main reason. Because apart from that, we still -- I mean, quite -- we feel quite strong in terms of our AUMs activity, our brokerage activity and transactionality is still strong. So there's no other reason apart from that, that I mentioned is the comparison to the fourth quarter last year that had some success fee.

Regarding to the assets under management, there is a slight decline. Remember, we have a month of April with the Liberation Day, brought a little bit of a volatility to the market and uncertainty. So the month of April was probably a little bit more defensive. But since then, we have a very strong commercial activity. So months like May or June have been very strong like other months in the year. So from a commercial activity, things are running pretty well. So no big deal for that.

I will answer about M&A. Actually, what we have said and that we are looking -- part of our strategy is actually the diversification of sources of income and namely geographically as well as in terms of different businesses.

So at present, around 16% of our gross margin comes from Portugal and Ireland. And our objective would be like in the next, say, 3 years to have a contribution, 3 to 5 years to have a contribution that is around 20%. And looking to a further future to get -- to have a contribution from overseas of 1/3 in our income lines. But said that, there is nothing that we are -- that we have to say or there are no news. We are not working on any acquisition for the moment.

Our next question comes from Ignacio Ulargui from BNP Paribas.

I have two questions. I mean one on lending. If I just look to the loan growth in the quarter, you have seen a bit of an improvement in Spain versus Ireland. Just wanted to take a bit of your thoughts on how you see dynamic trends in terms of lending demand in corporates in Spain and mortgages in Spain, how -- whether that perception that we have seen in the second quarter will continue into the second half.

And the other question I have is on NII. I mean how should we think about the progression of NII in the coming quarters? I mean, Jacobo, you have said that clearly, 1Q was the trough of NII. Should we see an acceleration? Or do you think that we may get kind of this level towards the end of the year?

Ignacio, so taking the first question. I mean lending growth in Spain had a very good behavior in this quarter. I think you were mentioning that probably are stronger than probably in Ireland. I think Ireland has -- is growing also pretty well. I think there is -- the mortgage market is -- has a little bit more probably of seasonality there. So we are expecting a quite good second half of the year in Ireland in mortgages in special.

The corporate segment in Spain is behaving very good. The mortgage segment in Spain is behaving very good. So we don't foresee any major changes in those trends. So we think there is a quite strong trend. I mean the market is growing, as you know, pretty well. And of course, we are also taking advantage of this good momentum and we are doing our best in this market.

And in terms of NII, yes, I mean, we've gone through the trough in the first Q. So we should expect that the third quarter should be more or less the same, flattish compared to the same quarter of last year. So we will be already equal. And we definitely expect a quite a very strong comparison in the fourth quarter that will bring us to that flattish NII in the accumulated figure for the year. So once again, we are managing quite strongly the client margin, as I mentioned. So we are targeting this 2.7% client margin to be the target for the year, and we will keep managing the cost of deposits as we have done in the previous -- in the first half of the year in order to make sure that these levels of client margin are preserved across the year.

Let's move on to our next question now from Ignacio Cerezo from UBS.

I've got two on NII. The first one is if you can give us on, the deposit side actually, the cost of the site and the time balances in the quarter. And related to that, actually, obviously, we have seen a big swing of time deposits into site balances. I think time is around 20% now. If you have a feel basically of how low that number can go in the future? And then the second one from a timing perspective. When do you think the loan yield is going to bottom?

And so far, actually, if we have a look at the pass-through view on actually your lending yields, since the moment rates has started to go down. We're probably talking about around 35%, 40% lending pass-through. That is below, obviously, the percentage of fixed floating you have in your balance sheet. So should we assume actually, are you going to be converging towards floating percentages? Or are you going to be able to squeeze a little bit of loan yield as rates go down?

I'm going to try to answer. I'm going to start with the second. I think your question was regarding the loan yields and where should we expect the levels. I think the way we see it is in terms of spread over Euribor. So we are managing levels of loan spreads versus Euribor in average of around 150 basis points. So if we do expect levels of Euribor around 2%, that means that at the end of the year, the yield should be somewhere around the 350. I think this is what you were asking.

In terms of the cost of deposits, we mentioned that by the end of the year, we should end up in levels below 80 basis points. I don't have here right now the split of the cost between the term and the site deposits. But the percentage or the proportion of term deposits will still go down in the coming quarters.

And the difference or the change that you've seen in this quarter is also due to the integration of EVO Banco. EVO Banco was considering the vast majority of their deposits as term deposits, while once they have been integrated in the Bankinter accounts, they've been considered a remunerated site accounts. So that's the main difference in terms of the split and the percentage. Having said that, this will provide us much more flexibility in terms of cost management, as you can imagine.

Our next question comes from Carlos Peixoto from CaixaBank BPI.

Yes. I have a couple of questions on NII as well. The first one is actually on the follow-up on the previous question. So you mentioned before that you expect first Q NII to be roughly flat year-on-year. And then in the fourth quarter performance towards the flat NII performance you expect was in the full year. The question here is that implies basically 6% quarter-on-quarter increase in NII in the fourth quarter. Is this driven by the lower deposit costs that you mentioned? And is the 80 basis points deposit cost that you mentioned the average for the full year or the fourth quarter level?

Carlos, yes, I was mentioning that we do expect to see the cost of deposits around 80 basis points, which is the, I would say, at the end of the year. And this is why you were mentioning and this is what I said is that the NII in the fourth quarter, we expect to be higher, much higher than 1 year before. And this is basically because we are working hard in terms of keeping the client margin at the current levels. And the way to make sure that we achieve those targets is managing the cost of deposits.

Our next question comes from Alvaro Serrano from Morgan Stanley.

Just hopefully, very quick questions. On the guidance, I think you've said around flat NII. I'm conscious that before, it's just flat to slightly up. Is there any sort of intended fine-tuning of the guidance on NII? Or just you phrased it differently? And then -- so that's a clarification.

Then two quick questions, please. On the improvement in the mix of deposits, I realized part of it is EVO Banco that you just mentioned. Is there a risk that some of these term deposits offer sort of the natural mix shift that is now in current accounts. Does the deposits leave the bank or go back into term? And a very quick last question on loan growth. You've maintained a mid-single-digit loan growth, but you are pretty much at 5% or 4.7%, I think, year-to-date. So the run rate looks like it's going to be much better than mid-single digits. Is there anything I'm missing on the loan growth?

Alvaro, I will be answering you about the loan growth. I mean, actually, we are seeing very good dynamics in the market. And we are very confident that we'll be in the 5-ish percent growth this year. So very similar to mid-single digit. I think that was the guidance.

And then with respect to deposits in EVO Banco, we are seeing no churn at all or nothing significant of clients or balances. So -- and the products they have is a product that very popular in Spain, more popular than deposits, which is remunerated current accounts. I mean, you probably know them, these digital accounts. And no, we don't expect them to go deposits because they are much less flexible for the clients and also for the bank. So the client is not interested, and we aren't either. So we expect them to stay more or less in the percentages they are now.

Yes. And regarding your first question regarding the guidance. Yes, basically, in April, we had a quite sharp decline in Euribor of 30 bps, and that has an impact in terms of delaying or impacting in the short term, the repricing of the loan side versus the deposit side.

So at the end of the day, yes, it's a fine tuning, but it is just a lagging effect. It's just basically, we will come to the improvement in the NII in coming quarters. But of course, after 30 bps of sharp decline in a very short period of time, the repricing of the assets, basically in the corporate banking business has impacted a little bit. At the end of the day, we keep our flattish NII guidance, but we do expect growth in the following quarters.

Our next question comes from Britta Schmidt at Autonomous Research.

Just a follow-up on the net interest income. Just with regards to the trajectory, so we arrived in back solving that you're targeting EUR 600 million plus NII in Q4. Can you just explain a little bit more that all driven basically by a delayed decline in the deposit costs? And if the exit NII is around EUR 600 million in Q4 and rates remain more or less flattish, do you expect to growth on that annualized number of EUR 2.4 billion?

And then secondly, just coming back to the mix effect. Was there any repricing also in terms of moving the EVO accounts to the La Cuenta Inteligente? And is that more or less a one-off effect that is done? Or do you expect more to come there?

Britta, so I mean the NII effect is, of course, is not just the cost of deposits because we have also a higher size of our ALCO portfolio. We have an ALCO portfolio, which is already close to EUR 15 billion, and it is yielding 2.5%. So we also have, of course, our wholesale funding, which is repricing downwards and it makes our NIM resilient at 1.85% levels.

Yes, but of course, bear in mind that we have barely fully repriced the corporate banking loan book because it reprice very, very fast. So that means that the repricing of the asset side of the loan side in the coming months will be basically focused on the mortgage book. And we think that by September, October, things will be much fully repriced. So that's why we do expect that in the last quarter, things will be much better, optimistic in terms of the comparison.

In terms of the mix effect, I mean, we are not expecting any changes. I mean the Cuenta Inteligente is behaving exceptionally well. All the EVO clients have come into Cuenta Inteligente. I remind you that in parallel, we are we are quite active in terms of the digital account as well and salary accounts. So in terms of mix effects regarding the EVO, we are not expecting any changes. Apart from that, we are commercially very active as usually, in bringing good clients and resources and et cetera.

Our next question comes from Hugo Cruz at KBW.

I would like to repeat the question from Britta actually because I think it's a very good question, which is if your exit rate of NII is EUR 600 million in Q4, should we annualize that for starting for next year? I don't know if you answered the question.

And then question on M&A. I can understand the logic of Portugal because it's very close. But I mean, you have very good ROE. Spain is growing nicely. You still have low market share. So why are you so focused on geographical expansion? Is it just really a matter of diversification? Or do you think like it's just to continue to look for good ROE opportunities? What's driving the international expansion logic?

Well, I will take the international expansion question. We are not focused at all. I mean, I think it's more the press that has a very flashy -- how do you it? Whatever, yes. So they're taking this very seriously. I've only said that in next 10 years, so it's a very long period. We would like to have 1/3 of our income coming from overseas because we think diversification, geographic diversification is important to our business model.

But for the moment, we have a lot on our plate. We are actually transforming Ireland into a full-fledged bank, and we investing in Portugal, both in [ universal ]. And we are also investing in digitalization of our Portugal branch. So we are focusing that. We don't have in our agenda any purchase, any M&A in Spain nor in Portugal or anywhere else. So just to be clear, okay? So I think the press has given a lot of light to something that is not so important. And okay, I pass to Jacobo.

Yes, sure. Yes, I think the -- what's important here is that we do not provide guidance on 2026. I think that's the first point of the answer. So unfortunately, I cannot directly answer your question.

However, if expectations on rates are to stay above 2% in the coming quarters, and I mean in 2026. And of course, our track record of loan growth in the past has been around mid-single digit, then I'm sure that you can figure out what can happen in 2026.

Thank you very much to everyone for participating in this call, and we thank you as well for adapting your time schedules to us today. And that concludes our Q&A session. And if any questions come up after the call, the Investor Relations team is here to answer you. Thank you, Jacobo. Thank you, Gloria, and have a nice day, everyone.