Vanguard Dividend Appreciation Index Fund Price & Performance (VIG)

And we are pleased to welcome you to our telephone conference. Starting with the results of 2024, I just also want to remind that 2024 was a special year. We celebrated two hundred years of existence of the roots of our group. So I think long term sustainability is fixed in this way and also thirty years of list listing on Vienna Stock Exchange, which might also show our resilient development also in this case. Coming maybe on the first slide from my side, taking an overview about the key KPIs of last year's developments. We see all over strong full year performance from VIG especially with very strong growth on gross written premium We reached more than EUR 15,000,000,000 of premium which is by EUR 15,200,000,000.0 more than 10% up on the result of last year. Changing to IFRS 17, we see that insurance service revenue also increased by 11% up to €12,000,000,000 dollars and the most important for us that profit before tax increased by 14.1% up to €881,800,000,000 euros What we see also is that P and C net combined ratio [indiscernible] points to 93.4, which will come back to that in detail It is also, of course, influenced by the big storm Boris, which took part in summer last year.

And earnings per share increased to €4.98 and up to that also a positive impact we have on the operating return on equity which also increased and improved by 1.3 points to 16.4%. So all over very positive performance and very positive also developments in the main key figures. On the next slide, we'll go on with, I think, one of the most important factors of our development over the last years and also for the future. This gives strong basis for good performance over the next years. It is the diversification and we show here in the two pictures the gross written premium diversification by segments Here we see that Austria over is about 26% and that also extended CEE already in premium is balancing the Austrian book, Czech and Poland with 1410% quite strong and also special markets coming up with around 9%. In this case, going to the right part of of the results, we see result before taxes steel, Austria, is even higher in the level of results. Even also check But what we see is that there is already quite good balanced situation coming from extended CE and special markets. And this also we see in the perspective for the future that the potential we have is that especially Central Eastern Europe will improve also in the balancing of the result before taxes.

And what is most important and Vienna Hine will come back to that that we have not only the growth of premium, but also the result before taxes in a very balanced situation in between the segments, in between the business lines. And the diversification all over is stabilizing also the results. Next slide, the dividend proposal. The Board members will propose up by 10.7% to last year We want to increase the dividend to $1.55 per share. Which gives net attractive dividend yield of 5.1%. You see also in the chart the dynamic increase in the payout of dividends. Which is also important to be seen on the basis of our dividend policy. Which we defined last year already. So there you are fixed that there is the minimum dividend paying now in the proposal for 2024. Is again the minimum for the dividend increase of the next years, which will also depend on the operating earnings situation and I will come back to that later with also the outlook for 2025 so that we can expect here also dynamic perspective in the dynamic development for the next years. Saying this, I will hand over to Vienna Herne to go deeper into the financials.

Thank you, Hartwig. And also from my side, warm bedtime to everybody in the call. Let's have a closer look at the group income statement, which we show on Slide seven. Apart from the already mentioned positive development of insurance service revenue, which is up by €1,200,000,000 mainly driven by the C and C business I would also like to highlight the increased total capital investment results. This was mainly the result of a higher interest revenue from the bonds portfolio supported by the market interest rates development. It presented strong results before taxes of €881,800,000.0 includes a goodwill impairment of €116,300,000 made in Hungary. As a result of the repeated prolongation of the additional insurance tax, by the Hungarian government, scenario analysis have been performed to further expenses arising from this tax beyond the current statutory period. This resulted in a significant reduction of the cash flow projections and led to the impairment of goodwill. The tax ratio [indiscernible] 24.4% is one percentage point below last year's 25.4%. The tax ratio in this range is also to be expected On Slide eight, on the next page, we show the insurance service revenue by segment.

Double digit growth rates were recorded in Poland, the extended CE and the special markets. [indiscernible] The strongest contribution to the revenue growth with more than €450,000,000 derived from the extended CE segment where Romania, Slovakia and Deportext well as Hungary and Bulgaria showed solid growth in the motor and other property lines. Of business. These lines of business are also the reason for the dynamic development in Czechia being the main driver for additional EUR $367,000,000 insurance service revenue in the special market segment. Austria followed with an increase of €236,000,000 in revenues mainly coming from non life. [indiscernible] On Slide nine, the strength of the non life and health business is also reflected on the insurance service revenue development by line of business. With the exception of Life business with profit participation, all lines of business were growing double digits Other property was the main contributor with an increase of more than €670,000,000 followed by motor, third party liability and capital [indiscernible] each with an increase of more than $220,000,000 and health with an increase of €108,000,000 Let's move on to Slide 10. In the detail of the results before taxes development. Despite the already mentioned goodwill impairment in Hungary, it of €85,700,000 contributed to more than 50% of the overall profit growth of €109,000,000 Poland, which we started before taxes last year, was burdened by the restructuring measures taken with regards to the effective mergers was able to increase its profit by €35,700,000 Together with the fourth €24,400,000 increase in the Special Markets segment The positive developments in these three segments the result before tax declines in Austria and Czech Republic.

This shows one of the advantages of the broad service diversification of VIG. Increased combined ratio due to weather related claims, and the decreased capital investments resulting in off that did not harm VAG's overall strong profit growth of 14.1%. As I have mentioned, the combined ratio increased in Let's have a look at the combined ratio on Page 11. Overall, VIG's net combined ratio remained on a sound level of 93.4% slightly up by 0.8 percentage points.

The discounting impact on the claims ratio was 3.4% in last There has been no material change in the figures relating to Winterstorm tourist that we announced in our conference call in November already Gross losses from this exceptional NASCAR event amounted to €617,000,000 last year. Thanks to VIG's comprehensive reinsurance program, the impact was limited to a net figure of €70,000,000 demonstrating VIG's conservative approach. On Slide 12, we show the CSM role for business. The overall decrease of 4.7% was mainly driven by the change in variable fee approach. Lower interest rates compared to the previous year caused a minus of €286,000,000 Worth mentioning for 2024 is the relation between new business of €480,000,000 and the CSM release of €513,000,000 The sustainability index of 93.6% was also impacted by the profitable new business volume from Chequia that supported the further increase of the new business margin to 10% after 8.9% in 2023. With this, let's move to the investment portfolio. On Slide 13, [indiscernible] we presented details of the already mentioned increased [indiscernible] Main driver for this development was the increased interest revenue from the bond portfolio.

The investment volume in bonds decreased decreased by more than 400 increased by more than €450,000,000 in 2024. Total investments amounted to €36,500,000,000 up 3.4% compared to the previous year. The next page, Slide 14, shows the usual breakdown of investments. Compared to 2023, the proportion invested in bonds decreased slightly from 75.3% to 73.8%. The proportion invested in property remains stable whereas portion in cash and deposits increased from 7.8% to 9.5%. The total average new investment yield in 2024 was kept at a favorable 5.3% only slightly down from 5.5% at year end 2023. As the bond portfolio split by rate and issuer is rather unchanged compared to the previous year I would like to move on to Slide 15. Our diversification across markets lines of businesses and distribution channels [indiscernible] On the right hand side of this slide, we are pleased to share our also shows a very diversified picture. The Czech Republic and Poland are represented with a share of around 14% followed by Austria with 9.2% and a share of 9.7% for Super Nationals. Romania, Czechia and Slovakia have each a share above 5%. Remaining government bond portfolio consists of more than 20 countries with less than 5% exposure exposure With this, I come to my last slide before I hand back to Hartwig for the outlook outlook.

The excellent capitalization of VLG is reflected in the strong formancy ratios both with and without transitional measures shown on Slide 16. The solvency ratio including transitionated year end 2024 was 261% after 269% at year end 2023. While owned funds only slightly increased year on year by €456,000,000 The SCR increased significantly by €142,000,000 driven by strong business growth. The solvency ratio excluding transitional also slightly decreased from 243% to 238% at year end 2024. [indiscernible] Given the ongoing challenging geopolitical environment and all the uncertainties it brings we are comfortable with the solvency ratio of 238% remains above our target range of 150% to 200%. With that, I would like to hand back over to Hardwick for the outlook.

You, Vienna. So I will continue with the next slide number 18. Where we show I think an quite interesting and significant chart with the forecast of GDP growth on a global basis. And what you see on the right side is that the countries of Central Eastern Europe and also Central Eastern Southeastern Europe are quite a yes, the average, what is then concerning to Western European or even European Union basis, we see that all over we are in the right region, also in the perspective which will be also stable above the average, which will be reached in the Western European Union countries all over. So we see also in the chart on the left side that with expectation of 1.2 or 1.4 The expectation in Central And Eastern Europe still is quite doubled. In the size to that and it is in the ranking on the chart on the right side shown also in a global perspective that Central And Eastern Europe is quiet and still in very interesting region for expansion and for investments. That is also the positive support given to the outlook 2025 on the next chart. We are ready as the management seen also the last years that there has, of course, been impacts also on the geopolitical and also on the macroeconomical conditions.

But what we see up there that with diversification the also performance over the last years. That we can in a positive way look also in perspective and also the weighted form of results range. And out of that, we have a clear ambition that also in the profit before taxes for the upcoming year We expect a range between €950,000,000 to €1,000,000,000 in the financial year 2025. Which is also given this positive performance another step on. And as it was mentioned by me before, also in the expectation to in the link to our dividend policy we have a common positive expectation to the future. That's from our side, our presentation And so I give back also to the moderator and we are looking forward and we are very pleased to answer your questions.

The first question comes from Yudish Shikore from Autonomous Research. Please go ahead.

Good afternoon, everyone. Thank you for taking my question.

Got three questions. The first one is on your guidance. And I was wondering whether you could elaborate on some of the assumptions behind it, namely in terms of revenue growth, P and C combined ratios, etcetera. That's the first question. And then secondly, just on your top line growth that you reported actually in the last few years, it's been quite strong. Now that inflation has moderated, would it be fair to expect like quite a significant deceleration from the double digit growth you have achieved. And then finally on capital deployment, mean, once again, you ended the year with a very strong policy ratio, whether or not we include transitional.

So I was wondering, I mean, in the past, it's said you would deploy the excess by reinvesting in the business and on M and A. As opposed to distributing to shareholders So firstly, he's absolutely positioned and then secondly, on M and A, what are your target countries and lines of business for expansion? Thank you very much.

Okay. I will take and start with the last question from our side. In your question, what about our interest in M and A and maybe investment in that case? I just want to open that we are still in our 20 program, BHE25, which is ending this year. And we already started a discussion about our strategic options for the next three years, twenty six to twenty eight, In this discussion already started, but not finished, we also are screening our core markets Central Eastern Europe where we have quite strong market positioning in main see still are interested and see the potential, for example, in the country Poland, but also as you know, we are also interested to clear up about positioning or starting more activity in Slovenia. So this is on the basis of the current existing market. But still we are screening also in the way of expansion in the form of special markets As you know, we have beside our 20 core markets, 10 special markets already. Which are focusing sometimes in niche perspective on growth, but also in a very broad profitable way expanding and supporting our total results. So this means that we are ready and as it was mentioned by Liane also our strong solvency basis gives us the support also to taking the opportunities, which will come up and fit to our strategic program which we will then present also end of this year to clear up which activities will follow.

In this way. To the other questions, I hand over to Peter Hoeferfinger about your question to combined ratio. Thank you for your question, if I understood right. It's combined ratio and correlation to higher guidance for the year 2025.

So on one hand side, truly we have been benefiting from inflationary effect the last years, which was also driving our growth. But please never forget inflation means that we also had increased our sums insured, our underlying sums insured. So also this effect is here. We are now on a higher level of sums insured. We have on one hand side within our investment portfolio we were able over the last years to shift to higher yield bonds. We are continuing to benefit out of this even though maybe interest rates [indiscernible] be flat going forward. Our portfolio has been changed over the last years. So investment result on one hand side will support our further development of results. On the other hand side, and this was mentioned in the presentation of my colleagues, you saw the forecast of GDP We will benefit from the GDP growth. This GDP growth is also quite supported by internal demand. We had an overproportional salary inflation in Central Eastern Europe.

Maybe differently to some other businesses. We do have more clients than fleet. Therefore, we are over proportionally benefiting from salary inflation having our customers having a higher living standard and therefore a higher need for insurance This is even supported by tendencies, which we see of repatriation of CEE people working in Western Europe coming back to Central Eastern Europe seeing the attractiveness of top opportunities, but also rising living standards. I have just one bigger in mind, which is Romania. So in Romania, since the end of COVID, more than 850,000 people have repatriated to Romania. These are principally younger people more energized people people which are expecting higher standard of living, which they have learned in Western Europe. They are also willing and used to insurances So this will support and drive our growth This makes us quite confident that we will reach our guidance, which we are giving for the year '25 All right. Thank you very much. It sounds like there is quite a lot of the growth is is assuming some decent volume growth from all the factors you mentioned. So I would think that is not notable, but also property and underlying for business.

If I understand it right, because unfortunately, your line is not so clear. It will be driven by older non lifelines and if you look on our performance over last year, the performance was also very much driven by Cascaux business. And CASCO business is the clear indication of internal demand. People are willing to buy new cars, used cars on finance basis. Therefore, they need also to take out a cash co insurance. Which shows a very positive consumer climate. And this we believe to continue.

The next question comes from Auguste Markkan, UBS. Please go ahead. Hi, good afternoon. Thanks for taking my questions. I have two, if that's okay.

First on the payout ratio.

I appreciate this might be a good problem to have. But given your strong EPS growth, it has outpaced the EPS growth over the last couple of years. So the payout ratio has been declining. Do you see any scope of increasing the payout from the low 30% And what will be the binding constraint limiting you if you don't see that?

And then secondly, on your reinsurance, last year Boris was a massive event in the CEE. Did this change your reinsurance program or increase your reinsurance pricing at the renewals? Thank you.

I'm happy to start with the second question of reinsurance. Yes, Boris was a major reinsurance event. It paid off that we have invested over the last years and decades having a close relationship. We are working together with two external modeling companies. There is no market model in Central Eastern Europe. So our models most probably are the most sophisticated We are the market leader the reinsurance industry when they want to get Central, Eastern Europe as a diversifying element in their portfolio to sign in our contract. This is then reflected on the conditions. Is also the reason why we have been able also the last years in the hardening to still keep our terms and condition And also looking forward, in principle, we will keep our basic logic of the program. There will be certain adaptation but one also has to be clear Boris has been a modeled event And we therefore also paid modeled premiums in the past So reinsurance industry did accept that this event is happening because for this, we are buying reinsurance industry There is no major change in our reinsurance politics going forward.

I'm happy to take your question regarding the payout rate and dividend per share. Last year, we changed our dividend policy [indiscernible] to the last year's dividend as a minimum dividend.

So we increased this year, as already has been said, from €1.4 to €1.555 which follows the positive developments of our performance. We have no plans to change this dividend policy. Also, we we consider a dividend yield of 5.1% as as attractive also in the current interest rate environment. And I would also like to remind you on the positive [indiscernible] we have a guidance of our profit before tax in the range between €950 and €1,000,000,000 which shows a positive development also expected for next year, which also should lead hopefully to an increased dividend I hope this answers your question.

The next question comes from Thomas Unger from Aste Group. Please go ahead.

Yes, hello. Good afternoon. Thank you for taking my questions also. I'd like to get some more details on the outlook for 2025. If you could talk about the individual geographical segments, Austria, Czech Republic, Poland, extended CE. Where do you see what what do you see as the growth driver for 2025 in terms of revenue growth, but also also profit development. Do you see the smaller segments extended to special markets continuing to be the growth drivers or how do you see the Austrian and Czech Republic developing? And looking back and staying within the segments extended CEE, very positive development in 2024. If you could zoom in on the on this segment and talk about the countries in a bit more detail Bulgaria, Romania, the Baltics, Slovakia, all with very significant earnings increases. I'd appreciate that. Also the significant uncertainties currently to your political, financial markets. How do you see that affecting your your results? Or how does that affect your outlook for 2025? The impact on the capital investment result from the yield curve changes and so on and so forth? And also do you have a for the capital ratio, do you have a combined stress scenario, it's multiple impacts affect you negatively?

What could be the impact on the capital ratio? Thank you.

Okay. Thank you for your questions. I will start from my side. And then hand over maybe to Peter Hoefering when we come to Romania, Bulgaria and maybe some other detailed countries. So I think overall, our outlook for '25 is running on the basis which was successful in 2024, What we see especially is that Poland's still has room for growth on a higher level and also profits. So this segment, I expect from my side, will come up in 2025 again. As you know, we did the merger in 2024. Also to focus and concentrate in our activities there. There is still potential in also parts of P and C and also corporate where we focusing on in the strategy in Poland. Your question to Austria, Czak, on the one side, when we come back maybe to Slide 18, where I mentioned We know currently that Austria is on a quite low level The recession awaited also for 25%. But even in Austria, we see out of the development of 2024, there is room as in the way of health business, but also in the expectation that life will step by step come back and especially Winer Stetich is showing also in the partnership with the Ester Group that there is the possibility still also for growth above the market And in this form also inflation coming back in some form will also bring a basis of growth in Austria still. [indiscernible] there is some pressure on the market but with two strong players, especially beside Corporativa as the market leader, we have JPB.

Still in a very positive growth activity Here, we also have high potential in cross selling coming up of the existing portfolio. So and also with new life insurance, we are quite successful on the which will also bring up positive expectation for the upcoming year in this area. You touched also extended CE. We have in '24 very strong support in this form of Romania and so I think now I hand over to Peter Herfinger to go into detail that way.

I will start a bit more in general words about extended CE, also with the smaller [indiscernible] Looking in the more volatilities we are having and the more volatilities we have ahead not just geopolitical All these countries and extended CE are used over the last years and decades to deal with volatilities therefore societies, but also the businesses there. To have a very different resilience in scoping with these challenges. I mentioned already in answering before one question There is a certain repatriation element from Western Europe. Having a lower economic performance in Western Europe Therefore, giving less opportunities for people from Central And Eastern Europe having their jobs returning to their home countries. Which gives an impetus of energy and new labor forces. Which is important in all these people. Have been outside of what we call the extended CE. They have an education, they have they understand other languages, They have seen a different way of living. Have a different expectation on the other hand of the environment. Which I also would like now to have again in their home country All this is also driving dynamic which we see there. This is also supported with looking to the dynamics of going more to a multipolar world with taxes and tariffs, where also within Europe, manufacturing companies will have to think about having manufacturing sites within the European geographical area.

So in lower distance to the main factories maybe in Germany, Also, this will further support foreign direct investment in our region combined with having the repatriated people from Western Europe, so also having workforce there. Specifically in Romania, do have in Romania currently quite a volatile political situation. But there is a certain decoupling of the economic environment from the political situation So economy and GDP growth is quite favorable. In Romania, regardless of the political [indiscernible] And we see a positive atmosphere and a positive business approach in Romania. We are having still there issues with regulatory topics. With certain price capping on the motor business. But this is now already for some time there. This price capping has forced us to focus very much on other lines of businesses And we see now the first fruits of having very much focus on non motor business lines and growing very much in property and private property and commercial lines and health. Which is supporting the profitability which we see today in Romania and we have a profit increase in Romania of 4% to 6%. We have an increase of insurance service revenues about 25% quite similar in [indiscernible] where we are also growing double digit in profits and in insurance revenues.

So we also do have a quite optimistic and positive outlook for extended CEE for the year. 2025.

I'm happy to take your question regarding the uncertainties and how this affects our outlook and other KPIs? I would like to remind you that in last five years, we had uncertainties to manage and we managed them very successfully. And as such, we feel very well prepared also for the volatile current environment and also in the upcoming months we months we expect some volatilities. We have models in place for our press test scenarios. And due to our high capital strength and also due to our diversification, which leads always to compensatory effect I'm quite confident that we will handle the upcoming volatilities also in the same way as we did in the last year. And here, I would also like to mention that IOPARDIT is stressed best last autumn. 48 companies or groups were participating in this stress test and the outcome for VHE was that after distresses without any management reactive measures, we had still a solvency ratio above 200 percentage points And we are this reside among top three companies Europe So due to our high capital strengths and also diversification, I'm confident with the outlook that we have given for 2025.

Thank you very much.

The next question comes from Tejas Kiran, K. M. From White Oak Capital Management. Please go ahead.

Hi, Thank you very much for the opportunity.

I just wanted to double click on the 2025 outlook again.

So thank you very much for the comments on answer to the previous questions. But I also want to impairment in Hungary for this year itself, So the profit before taxes adjusting for the impairment would already be in the range that you're targeting for next year.

So does that mean that with all these developments in the business, you might also expect one offs and this target is given adjusting for those one offs? Or how should we think about both of these factors interplaying with each other? And my second question is on the impairment again. If you could help us understand whether you as of your current expectations, do you think we are all done or you what should happen next year? That might trigger another impairment in Hungary?

I'm happy to answer your question. Let's start with the impairment. As I already explained before, this impairment was the result performed some scenario analysis behind and the result was and I must say we had a conservative approach approach in our scenario analysis that this resulted to this impairment €116,300,000 The remaining goodwill in our books is approximately €70,000,000 So the risk for further impairment and if it materializes, will not really affect materially our results Going forward, we will see how the Hungarian government will deal with the additional insurance tax and if there are any changes, negative changes this could lead to further impairments as I said before, from the total amount, not something that we cannot manage here at the group. From the result, the result was impacted by the additional tax in 2024, the amount of €50,000,000 2025, we expect a negative profit participation from the additional tax in the amount of €30,000,000 We will see what will happen in 2026. If we exclude the additional taxes, the company has a sound operating performance. And this is also our expectation in the midterm and long term future. I hope this answers your questions.

Yes. Thank you very much.

Thank you.

The next question comes from Rok Stibbidge from ODDHF. Please go ahead.

Yes, you mentioned basically a lot of things already.

So I'll be brief. I have only two follow-up questions. First one is regarding the guidance. We talked about Costco and regional development. However, I would still be keen on learning a bit more on how these see Life and Health segment developing in the next twelve months, let's say? And my second question is concerning the capital management or dividend policy, if you may. So I understand that there could be some M and A plans coming up You don't really feel like changing the dividend policy that you recently established. However, I mean, I'm just looking at at numbers now, you increased your cash position by 10%. So So when we see is in a very comfortable level Could maybe special dividend be an option? Is this something that you were considering when proposing the dividend to the Supervisory Board?

Thank you very much.

Thank you for the question of Life and Health.

I start a bit with Life business. On one hand side, after many, many years of low interest rate or zero interest [indiscernible] we are again back to an environment with interest rates, which is again giving a higher attractiveness to our classical life product. There is no other product no banking product, which is offering this kind of guarantees in the long run. And you have to be aware about one topic very different in Central Eastern Europe than maybe to Western Europe. [indiscernible] pensions already today do not give enough keeping your living standard which you have until your working time Everybody who is working today and is in the working age knows this. So the sensitivity, the awareness of old age savings is in the end a much higher in CEE than maybe in some Western European countries where we still have very [indiscernible] state pensions. And the need to put money aside is not so imminence, then maybe it is seen in Central Eastern Europe. So therefore, we are quite positive about the Life business. Also in relation with our banking partner As the bank Also seeing the topics of limited state budgets and therefore certain reduction on social security elements in the countries gives a protection gap for elements on one hand side in risk life but also very much in health business.

So we are positive with product innovations on the risk side biometrically but also on the side of old age savings that there will be again a certain dynamic which we will benefit of in that area. In Health business, when you look on the catch up potential of living standards, in Central And Eastern Europe. On one hand side, you see it with Caskos or people bought quite newer cars Apartments have been refurbished. People have been on holidays. What they are now also expecting is reasonable and state of the art healthcare which is not in most of the cases provided by the state health system.

That's the growing element of our Health business. And we are growing in Central And Eastern Europe more or less all over the place double digit. Because people are willing to take out the health insurance to receive health treatment and [indiscernible] on the standard which they expect and which they have learned outside of the countries. We are very much involved in further developing healthcare products which are very much supported by digital features where there is a high willingness and acceptance by people of Central And Eastern Europe to also use some digital applications in healthcare and we are also willing to go down the value chain So there is already a country like Bulgaria where we have invested into a health clinic so also to ensure that we provide these kinds of services to our insurance clients, Humper Health, we are quite bullish on how health business will develop for years to come.

Regarding dividend policy, I already '23 and there are no plans currently to change the dividend policy which introduced a floor of the last year's dividend to be the minimum dividend for the next year.

So €1.55 will be the basis for 2025. As we are we expect growing business and growing profits. I would also expect that dividend following the improved result will also follow this trend. I would also like to remind you again that we are still in a very volatile environment. We very prepared for this volatile environment. Through our diversification and strong capital position. But taking this into account, no special dividends are in discussion for the time being. So we will stick to our dividend policy for the moment and no changes here. In the near future plans.

Many things to both of you.

Next question comes from Bhavin Radhwat from HSBC. Please go ahead.

Hello, good afternoon. Thank you for taking my questions. So I have three on my side. The first one would be on the combined ratio Slide 11. Wherein we are seeing a 0.8 percentage point deterioration. However, if I go step back and look at [indiscernible] it was rather flat on a Y O Y basis, implicitly this means there was some underlying deterioration in the fourth quarter standalone. So can you just talk about some of the drivers that took place in fourth quarter that led to this deterioration? And maybe related to that, can you talk about the higher claim that we have seen in Czech Republic? What's been driving that higher property claims? And is that more structural in nature? And should we expect that to improve going forward in terms of the combined ratio check? The second one would be on Slide 12. The CSM roll forward. While I appreciate you don't really provide the sensitivity of CSM to market movements, it would be helpful if you can just break down the impact of $286,000,000 that was the change in variable fee in terms of how that was driven by different market movement pieces, I. E. Change in interest rate, spread movement, equity market movement, So what's driving that deterioration?

And that last would be again on the same slide. The PVNBP was quite strong in 2024, the growth pretty strong in 2024. Can you just talk about the sustainability of that Vienna? Should we expect similar level to sustain going forward as well?

Thank you. Thank you for the question. To the combined ratio. You know that we had porries in September. Czech Republic has been quite heavily hit there. I think we made a very very conservative first estimate about claims Nevertheless, there is a threat in a specific of flood claims differently to storm claims, flood claims to have a certain delay in reporting because people are realizing the claims a bit later. We therefore have also in the fourth quarter further increased our IBNR Let's see if we have maybe too cautious on the IBNR or if they are right, for the plot. So this is one of the elements And yes, there has been a bit higher frequency on property retail claims which I see as a certain appearance, which I do not see as a tendency and I'm optimistic that we will come back to the combined ratio Czech Republic, without special events like the flood which we are used to have seen Regarding your questions on Slide 12, yes, the changes in the variable fee mainly derived from reduced interest rate environment this is the main impact here. And regarding present value of new business premiums, This value increased quite significantly compared to last year because it only shows the new business.

So So here, I would like to state that this result also underlines the VHE strategic approach to exploit also markets. This year, we had quite good impact from the special markets. Especially to [indiscernible] So and we are valid there that maybe these opportunities may not be sustainable in the long run. So [indiscernible] would be the explanation for 2024. I hope this answers your question.

Yes, that's very helpful. Thank you so much.

Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Nina Hikebetzschwadz, Head of Investor Relations for any closing remarks.

Thank you for all your questions and your interest in BIT. The 2024 Group Annual Report will be published on the April 28. And if you have any questions in the meantime, please feel free to contact the Investor Relations department. We are happy to help. Thank you and goodbye.

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