Good morning, ladies and gentlemen. Before I hand over to Magda Palczynska, Head of Investor Relations, a reminder that today's call is being recorded. Madam, you may begin.

[Abrupt Start] full year 2021 results conference call. Andrea Orcel, our CEO will lead the call, then Stefano Porro, our CFO will take you through the financials in more detail. Following Andrea's closing remarks, there will be a Q&A session. And with that, I will hand over to Andrea.

Thank you, Magda. Welcome and thank you all for joining this morning. I am proud to be presenting an excellent set of 2021 results. We achieved or exceeded all our key financial ambitions. Underlying net profit reached €3.9 billion for the full year, comfortably above our guidance. Underlying return on tangible equity increased to 7.5%. Our proposed total shareholder distribution is increased to €3.75 billion, slightly higher than we presented on Strategy Day. This is more than comfortably funded by our in year organic capital generation of €6.5 billion, €3.9 billion from net profit, and €2.6 billion from risk weighted assets, thanks to capital efficiency measures. This reflects our focus on delivering meaningful or be prudent distributions founded by superior recurrent organic capital generation whilst continuing to invest and develop the growth and profitability of the business. Accordingly, CET1 increased 68 basis points to 15.56% pro forma for proposed distribution, but gross of 143 basis points of regulatory headwinds and other items that we consider non-recurrent. While we benefited from the more supportive macroeconomic environment, we achieved this thanks to decisive actions taken during the year and the dedication, enthusiasm and performance of our employees. Despite not yet having in place the set of objectives from Strategy Day, they took ownership, delivered and demonstrated what they're capable of. Just a few examples of what we achieved in 2021. We implemented the first critical changes to achieve a simpler, empowered and more unified organization. We have begun to remove bureaucracy, trusting and energizing employees to deliver their best within a clear risk framework and set of principles. We started evolving our business model to refocus on higher risk adjusted return lending, growing our capital light businesses and improving the returns in our capital heavier ones. This will improve our profitability and recurrent organic capital generation which you can already see happening from these results. The full Yapi credit shareholding disposal was agreed. The Non Core rundown was completed as promised. We signed up to the Net-Zero banking alliance, publicly declaring our commitment to more sustainable future and we enhanced and sharpened our policies across coal and oil and gas, reinforcing the principles that shape how we operate. We reviewed all business areas, organic and inorganic options to improve them, implementing what made sense and adjusting what didn't. And finally, we sharpened our focus on having best-in-class product factories for our clients, leveraging the optimal combination of our internal core competencies, and those of targeted partners with whom to build an ecosystem. As part of this, we have just announced a key step in the streamlining of our insurance partnerships, strengthening our agreement with Allianz in two ways; bank insurance and insure bank across our geographic footprint and respective clients. Product innovation, quality of service, digitalization, technology, sales force training, and marketing are core to our cooperation. This is the embodiment of a well functioning ecosystem, a two-way partnership, where we are able to complement each other's best-in-class offering for the benefit of our respective clients. This is a reflection of how we will look at and manage all our partnerships going forward. This is just the beginning. 2021 shows the potential of our franchise and is a clear blueprint for what we can deliver in 2022 and beyond. Let's turn to Slide 3. Our financial ambition to unlock UniCredit is based on six pillars; optimize, invest, grow, return, strengthen and distribute. These pillars will deliver sustainable performance and profitable growth through the cycle. Let me highlight a few of the successes we delivered against these pillars during the year. Please also refer to the annex for more details on the financials. Our full year cost of €9.8 billion are better than our guidance of €9.9 billion and we ended the year with a 55% cost income ratio. Our keen focus on cost management ensure they remain flat year-on-year, absorbing around €300 million in variable compensation, normalization and inflation whilst still delivering strong revenue growth with positive operating leverage of 5 percentage points. And while we are focused on management -- on managing cost, at the same time we are building for tomorrow and investing meaningfully in digital and data, the business and our people. We hired a significant number of employees in the fourth quarter, mainly in the business and in digital and data. Our people are core to our success, and we will continue to focus on building up talent. Grow and return. Net revenue hit the ball out of the court and grew by 34% compared to last year, thanks to a decrease in customer risk. Revenues were €18 billion, up 5% versus 2020, mainly driven by fees, and above the strong 2019. This is clear evidence that our strategy focused on capital light profitable growth is starting to deliver with our underlying net profit more than tripling compared to last year. In parallel, we reduced risk weighted asset by €4 billion while absorbing around €13 billion in regulatory headwinds, and almost €4 billion related to net revenue growth. Strengthen and distribute. Thanks to our successful rundown of Non Core, the NPE ratio decreased some 90 basis points quarter-on-quarter to stand at 3.6% at year end 2021. With a closure of Non Core, we reduce NPEs by more than €50 billion. Net NPEs were €7.5 billion with a ratio of 1.7%. We generated 200 basis points or €6.5 billion of capital organically, ending the year with a performance CET1 ratio of 14.1% above our guidance of 13.5% 14%. This includes the full impact of a share buyback of €652 million related to 2020. The absorption of 71 basis points in regulatory headwinds, 72 basis points of other items, most of which are one offs for the plan, and the total proposed €3.75 billion distribution related to the 2021 result. It is the result of our sharp focus on risk adjusted returns, and RWA management as essential drivers of maximizing both return on tangible equity and capital generation. At €3.75 billion the amount of distribution for the financial year 2021 is affordable and has more than tripled compared to the year before, testament to our clear commitment to shareholder friendly policy while preserving capital strengths. Let's turn to Slide 4. Meeting our strategic ambition is not just about the numbers, it is also about how the organization delivers them, and how we support our people, clients and communities. Building a strong and coherent corporate culture across all areas of our bank, a culture that unites all of our employees behind a clear and common objective, setting a standard of behaviour that will ensure success, a culture that is reflected in our decisions, processes, risk management, the creation of the right policies and operation, a culture of highly engaged empowered employees brought together on the united objective with shared ambition, a culture that provides a competitive advantage that is inherently difficult to replicate. It creates the bedrock upon which we will drive the organization to continued success, so that we can win the right way together. I am proud that UniCredit has recently won the Top Employer for the sixth year in a row reflecting our commitment to the well being of our employees and for providing an innovative, rewarding and inclusive workplace. We have also been recognized through many industry awards as a leader in promoting gender diversity. We continue to play an important role in supporting clients and community as we progress together towards a green economy by taking concrete actions, providing advice, and as we meet our own ESG linked commitment. Let's turn to Slide 5. The cornerstone of our strategy is leveraging our unique footprint of 13 banks across four regions; Italy, Germany, Central Europe and Eastern Europe. The combination of these countries brings us diversification benefits and an optionality to create value and accelerate growth many other banks don't have. All our regions delivered sustained growth in 2021, contributing to the increase in the Group's gross operating profit of 11.2%. As you can see on the slide, all four regions have contributed well to net profit in 2021 and are exceeding their respective customer equity generating strong returns on allocated capital. These are calculated based on the upper end of our capital target range of 13%, up from the 11 75% that has been applied until now. All the businesses will continue to improve return through the levers of net revenue, cost and capital efficiency. The slide also highlights the Lean Group Corporate Center with only a small relative weight of allocated capital and overall cost. Let's turn to Slide 6 to look at the different areas of our Group in more detail. Let's start with Italy. Net Revenue is up 42% in 2021, driven by materially reduced customer risk as we continue to maintain our strict discipline in origination while we regain our natural market share. Revenue grew 4% driven by fees up 15%. Digital sales increased by 11%. The revenue share of fees is higher than in other countries and increased by 5 percentage points to 50%, proof of our capital light business model. Yesterday, we signed an agreement with the Italian unions to start the relaunch of our Italian banks branch network, a testament to the approach we have taken in this negotiation and the positive result that it has had for our employees. And we have commenced hiring for sales people further strengthening our advisory and protection talent. Costs remained flat year-on-year absorbing digital investment. The cost income ratio improved by 2 percentage points in Italy to 47%. Capital efficiency is a key financial lever for Italy and an active portfolio management is already contributing to risk weighted assets down €1 billion quarter-on-quarter and €5 billion year-on-year despite stable loans. We provided €2 billion social loans continuing our commitment to the communities we operate in. Italy's ROIC [ph] grew to 11%. Let's turn to Slide 7. In Germany, net revenue is up 29% in 2021, supported by lower customer risk and a strong commercial recovery in fees and client related trading. Revenue is up 9% driven by corporate loans and good momentum on assets under management. We've rolled out our smart banking service model to circa 1.5 million retail clients and are the first in the German market to offer corporate digital account opening, including onboarding. This will allow us to grow our corporate client base, leveraging relationships to cross sell while supporting our clients. Costs are flat, absorbing the normalization of variable compensation, leading to a cost income ratio of 60% in 2021, down 6 percentage points year-on-year. This demonstrates initial progress on cost, the key lever to grow ROIC rock going forward. We also mutually agreed the strategic plan measures with the Workers Council as we streamline and invest at the same time, testament to the fact that the plan balances the interest of all of our stakeholders. ESG investment sales reached €4 billion gross assets under management, and finally, ROIC in 2021 is at 7%. Let's turn to Slide 8. In Central Europe, net revenue is up 23% in 2021, thanks to lower cost of risk and a strong business dynamic. Revenue is up 6% in 2021, with higher net interest income benefiting from a pickup in new production and rate increases towards the end of the year in several countries. Fees improved 5% driven by investment products despite a slowdown in transactional fees due to the pandemic. The commercial transformation towards digital is progressing well in Czech Republic and Slovakia, leveraging alternative distribution channels. Our focus is on enabling investments via mobile, developing instant payment for private individuals and developing call center sales. Active digital users have increased year-over-year by around 5%. Costs are up 2% well below inflation and despite hiring for the business, thanks to structural cost savings in Austria. The cost income ratio improved 2.6 percentage points to 55% in 2021. We successfully launched ESG targeted campaigns in all our Central European countries. Central Europe's ROIC reached 13%. Let's turn to Slide 9. In Eastern Europe, we achieved net revenue growth of 33% in 2021, driven by lower customer risk. Revenue is up 1% driven by fees up 6%, thanks to outstanding transactional fee generation and investment product sales and loan growth of 6%. We continue to develop our digital strategy with Croatia and Bulgaria delivering first enhancement in digital customer experience for individuals and other countries are closely following. Eastern Europe's share of digital sales reached 54% in 2021, up by 6%, and active mobile users increased by 15%. We maintain our disciplined approach to cost up less than 2% absorbing inflation and variable compensation normalization, sustaining an excellent cost income ratio of 43% in the region. Risk weighted assets were managed down, demonstrating the region's ability to enhance value creation further. Eastern Europe already plays a role as a leading pioneer to our clients for their green transition. We are proactively engaged in promoting social inclusion, leveraging our impact financing, contributing to enhance financial literacy of the population in countries where we operate, and establishing impactful partnership with public entities, universities and non-profit organizations. Eastern Europe's ROIC is the highest of all of our regions at 15%. Let's turn to Slide 10. Our client solution strategy is designed to leverage best-in-class products and services for corporate and individuals across our Group reaping the benefits of our scale. Client Solutions generated €8.7 billion in revenues up 15% in 2021, and accounting for nearly half of the Group's revenue, demonstrating our capital light strategy is in action. Fees were up a material 15%, a record year, thanks to a recovery in transaction and payments, and excellent activity in both structured finance and advisory. Our leading European bond and loan book for under position are reflected in our top league table position in most of our regions. This underscores our strong relationship with corporates based on quality advice and how we support our clients. Active portfolio management and capital allocation mitigated over €9 billion risk weighted assets inflation from regulatory headwinds and loan growth. Individual Solutions achieved an excellent fee performance driven by assets under management. Our ESG credential and advisory capability have been recognized in our strong league table position for combined green bonds and ESG linked loans in EMEA and is particularly strong in Germany. Before I hand over to Stefano, who will take you through the fourth quarter results in more detail, let me summarize our 2021 Group results. This was a year defined by solid commercial performance, maintained cost discipline, healthy asset quality, and a strong balance sheet underpinned by excellent capital efficiency, generation and profitability, and the commitment and dedication of our employees. Stefano, the floor is yours.

Thank you, Andrea and good morning everyone. Let's turn to Slide 12. Before I take you through the fourth quarter 2021 results, please let me alight that my comments are based on a year-on-year comparison, that is for quarter 2021 versus for quarter 2020 unless otherwise noted. In fourth quarter 2021 we delivered sound net profit of €0.7 billion. It is a reminder of what we disclosed at the Strategy Day going forward. We will no longer be referring to underline net profit, but to net profit, defined as stated net profit adjusted for AT1 CASHES coupon and impact from tax loss carry forward DTAs. For more details on the calculation of net and profit and net related KPIs, please see the annex of the presentation. Stated net profit is negative with minus €1.4 billion as this quarter was impacted by one-offs related to our new strategic plan. In fourth quarter 2021 we booked €1.3 billion of gross integration costs related to the implementation of the plan. Net revenue reached €3.6 billion in fourth quarter 2021, up 66%. This reflects considerably lower loan loss provision and strong commercial revenue, up 8.8%. Our stated cost of risk reached 74 basis points in fourth quarter 2021 reflecting the usual seasonality and increased regulatory headwinds. Underlying asset quality remains Elfi [ph]. The Group's cost discipline and continued focus on cost efficiency resulted in a cost income of 56% in fourth quarter 2021, down 2 percentage points. The stated CET1 ratio is a strong 15%, slightly down 11 basis points. Key recent financial events include the purchase of 33 million shares for a total consideration of €445 million so far as a part of the second €652 million shares buyback program related to 2020. Fitch upgraded UniCredit UniCredit SpA to BBB with stable outlook. In January UniCredit SpA successfully issued a dual tranche senior preferred note for a total amount of €1.75 billion. Let's now look at the profit and loss in more detail starting with revenue on Slide 13. Net revenue reached €16.3 billion in 2021, up 34%. In 2021, we generated €18 billion revenue, up 5% versus 2020, exceeding our target, thanks to feet growth of 12%. Our capitalized strategy is starting to deliver, shifting to better quality revenue. Trading income in fourth quarter 2021 was €220 million, down year-on-year and quarter-on-quarter due to a negative XVA impact. Trading in the first three quarters of 2021 was particularly strong, leading to more than €1.6 billion in 2021 supported by client activity. Let's turn to the next slide. Net interest income was up 6% quarter-on-quarter benefiting from positive nonrecurring item in Germany and growing loan volumes. Excluding the nonrecurring item, net interest income will be stable quarter-on-quarter. This is supported by recovering demand for credit. Average client loan volumes are up quarter-on-quarter driven by Central Europe, Eastern Europe and Germany. Please keep in mind that the standalone number excludes about €12 billion in loans, mainly from leasing in Italy and to a lesser extent Germany, that have been moved to IFRS5 held for sale. Customer loan rates are down 2 basis points in the quarter at Group level as we experienced ongoing pressure in Western Europe, while loan rates in Central and Eastern Europe are up. Higher market rates had also positive impact on the Treasury result in particularly in Czech Republic and Hungary. The net interest income contribution of deposit is negative as the high liquidity in the system lead to higher deposit volumes up 2% quarter-on-quarter and as customer deposit rates increased with higher rates in Eastern Europe. This was partially offset by better term funding. Let's turn to Slide 15. Fees delivered another great performance rising to above pre-COVID levels, up 12% year-on-year, supported by asset under management fees and transactional fees. We achieved the highest asset under management gross sales in stock in at least five years. Let's look at the component parts of fees year-on-year development in more detail. Investment fees were up 15%, thanks to strong asset under management fees supported by positive net sales in all geographies, especially in Italy. Transactional fees were up 13%, thanks to current account, card and payment fees responding to the pickup in economic activity. Financing fees were up 5% supported by loan and guarantee fees in Germany and credit protection insurance in Italy. Fees in 2021 stood at €6.7 billion, up 12% over the prior year. While this also reflects the impact of the pandemic and lockdowns a year ago, this is mainly driven by investment fees, thanks to our robust network advisor in sales activity, in particular in Italy. Let’s turn to Slide 16. For quarter 2021 costs came in at €2.5 billion in line with the same quarter last year. Our continued focus on cost efficiency and rigorous cost discipline led to 2021 total cost of €9.8 billion, beating our guidance. We successfully offset sizeable investment in Digital and Data of €1 billion. The normalization in variable compensation which was reduced in the prior year due to the pandemic, frontloading of TEAM 23 actions and absorbed the impact of inflation. Let's turn to Slide 17. In 2021, our stated cost of risk reached 37 basis points, down from 105 in 2020. The underlying cost of risk, which exclude regulatory headwinds, was 25 basis points, both were in line with our target. We kept our IFRS9 macro scenario unchanged in light of the recent pandemic developments including the Omicron variant. Our loan loss provision for 2021 were €1.6 billion including regulatory headwinds of €0.5 billion. We focus our risk adjusted return and growth, empowering colleagues with a clear risk and control framework. Remember that loan loss provision are factored into the net revenue. Our cost of risk is expected in the 30 to 35 basis point range over the plan. Our underlying asset quality remains sound. Risk management is the bedrock of best-in-class banking and we will not surrender the risk discipline we have worked so hard to acquire in the last few years. Let's turn to Slide 18. In fourth quarter of 2021, our risk-weighted assets stood at €322 billion, down 2% quarter-on-quarter as we already implemented some of the active portfolio management action of the plan, more than compensating regulatory headwinds. Active portfolio management and efficient capital allocation is fundamental for us to be able to boost returns on risk-weighted asset. Our business model is focussed on capital light profitable growth. This will more than offset the impact of business growth and expected limited regulatory headwinds. Let's turn to Slide 19. As mentioned by Andrea before, we organically generated 200 basis points capital in 2021, of which 120 by net profit and 81 from risk-weighted asset efficiency. Organic capital generation is in excess of 122 basis points in total distribution. Through net profit and the risk-weighted asset actions, we are consistently maximizing our capital generation. This led to a strong performance CET1 ratio of 14.1%, which fully includes the extraordinary shares buyback of €652 million currently been executed, the absorption of 71 basis points regulatory headwinds for 2021, and it is pro forma for the proposed distribution of €3.75 billion. The latter includes a cash dividend of around €1.17 billion and €2.58 billion in shares buyback subject to AGM which will be on 8th April and supervisor approvals. We intend to commence the buyback as soon as possible after approvals and to cancel the shares we buyback. Before I handover to Andrea, a few comments about our outlook. Although I would caution about potential market volatility and the macro-economic environment that remains fluid, a very strong 2021 as the economy started to emerge from pandemic lockdowns will impact year-on-year comparison. For 2022, we expect net interest income to be in line with 2021, when excluding the nonrecurring items from fourth quarter 2021, as the impact from the lower rate environment in Western Europe is offset by gradual recovery in the demand for credit, with the resulting progressive reduction of the excess liquidity. We expect demand for credit, which is correlated with financing fees to continue to recover. Investment fees should be characterized by normalized upfront fees for exceptionally high levels in 2021 and ongoing positive contribution from management fees. The trend in transaction fees is expected to continue as we recover from pandemic. All these combined should result in a slight increase in total fees for 2022 compared with 2021. Future fee growth will be supported by our plan to announce corporate solutions and our expanding product shelf individual solution. As a reminder, the dividend line will no longer benefit from the Yapi contribution and in the fourth quarter 2021, we had a onetime payment in the revenue in the balance line of about €90 million. We continue to focus on operational efficiency to offset the investment. We expect costs in 2022 to be in line with 2021 in light of higher inflation, especially in Central Europe and Eastern Europe. Our cost of risk is expected in the 30 to 35 basis point range over the plan. The Group tax rate excluding any potential tax loss carry forward or DTA [ph] write-up is expected to remain slightly below 30%. We continue to expect 2022 full year net profit on our new definition to be over €3.3 billion. We intend to maintain a shareholder distribution for full year 2022 of the same amount or more than €3.75 billion purposed for full year 2021. We will target a 35% cash dividend pay-out ratio from 2022 onwards, related to our new definition of net profit, with the balance in share buybacks. Beyond 2022, we intend to progressively increase our distribution in line with our organic capital generation as pandemic uncertainties and regulatory headwinds ease and our plan consistently produce even more tangible results. I will now hand back to Andrea.

Thank you, Stefano. Let's turn to Slide 21. At our Strategy Day in December, we outlined a plan that would lead us into an era of purpose, growth and value creation. Creating a bank that would deliver for all our stakeholders, the bank for Europe's future. The work to achieve this started in April and the results are already visible, providing tangible proof, but one ambitious, our plan is not only eminently achievable, but also prudent. We have already delivered positive outcome through combining three levers; net revenue, costs and capital efficiencies. But 200 basis points of organic capital generation in year, more than finances our increased distribution to shareholders was maintaining, in fact increasing a robust capital ratio. And this is the key. Our new business model does not rely on capital intensive revenue to grow and we'll more than generate what we intend to distribute to shareholders without compromising on our own capital strengths. Let's turn to Slide 22. We have a fantastic diversified franchise that has delivered excellent results and a compelling standalone strategy to unlock the value of UniCredit. This is my priority and what I would like to focus on today. We will continue to generate strong shareholder returns while maintaining a robust CET1 ratio to deliver sustainable annual distribution of at least €16 billion total between 2021 and 2024, the commitment, I am determined to honour, regardless of any inorganic growth option. We're embedding sustainability in all that we do, leading by example in our own business, helping our clients through a fair and positive transition and contributing towards a better, more sustainable society. In line with our commitment to support clients during transition, and our Net Zero plan, we have refined and upgraded our oil and gas and coal policies. Our ESG commitment has also been recognized by ESG rating agencies, and most recently in the Corporate Knights' 2022 list of the World's Most Sustainable Corporation. This award, as well as our awards for Top Employer in Europe and several accolades, recognizing our effort in promoting gender diversity reflect what we stand for as an organization. We are proud of the 2021 performance confirming the ability to deliver our plan and create long-term value for all our stakeholders. This is a testament to the commitment and drive inherent in this business and its people and to the strengths of our client base and relationships that we have. I am confident and optimistic about the future for UniCredit. These results, and the effectiveness and sustainability of our model gives us increased confidence not only in our ability to distribute over €16 billion over the course of this plan, but also to maintain and gradually increase annual distribution levels thereafter without eroding our capital strengths. This is a plan for the long-term. A big thank you, to both our client, for your trust and to our employees for your commitment. Before I open to question, I want to comment on the recent press reports that we were looking at a potential inorganic transaction in Russia. We were indeed evaluating the possibility of contributing our Russian operation into a creature in exchange for controlling stake to underpin its planned IPO. As such, the combined bank would have benefited from much stronger market position and significant synergies without meaningfully increasing our exposure to a country. We did undergo due diligence, but given the geopolitical environment decided to withdraw from the data room. I believe, I have a duty to our shareholders to assess all options that may strengthen our business and be accretive to risk adjusted returns and distribution within what is clearly framed by our plan. For any transaction, I will always try to factor in all consideration pertinent to all our stakeholders in order to arrive at the right decision by them. I also believe that I have demonstrated that our approach to M&A is very disciplined. We will continue to assess inorganic options in our key markets. We will be in data rooms and enter negotiation from time to time, and we will only close post transaction if and when the terms and conditions are right and in line with what we have committed in the plan. M&A is an accelerator, but it is not in itself a key objective. So I do not want it to dominate the results call. Moderator, could you please open the line for questions?

Thank you. We will now begin the question-and-answer session. [Operator Instructions] The first question is from Pamela Zuluaga with Credit Suisse. Please go ahead.

Hello, good morning. Thank you very much for taking my questions, I have two. So first I want to ask how much of the management overlay related to COVID provisioning remains unused? Could you please give us some guidance on the timing of potential relation -- releases of provisions if any? And the second, could you please elaborate on your ongoing plans to boost the income generation? And here I'm taking into account that you have announced a new partnership with Allianz, so how should we think about the asset management business? Are you looking for inorganic growth in this space or should we expect significant changes to distribution agreements? Thank you.

Thank you. So, in relation to COVID related provisioning, as you know, we did other overlays LLP during 2020, and also during 2021. With regards to the fourth quarter as discussed before, we have not updated the IFRS9 macro scenario due to the uncertainty in relation to the evolution of the pandemic considering the Omicron evolution. More specifically, we are currently having around €600 million of LLPs related to the IFRS9 macro scenario. We are updating the micro scenario twice per year, so in the first half and the second half of the year. So as a matter of fact, depending on the evolution of the macro scenario, during the course of 2022, we might expect to have some releases in relation to that. The other component will be connected to where potential progressive shift of south [ph] position that we have in stage two, in stage one, during the course of 2022.

With respect to Allianz, and more generally our partnerships, so the first thing is, as I said that Strategy Day, we intend to balance our internal core competencies where we think we have a competitive advantage and a skill set with true partnerships with partners that compliment us and with whom we can build an ecosystem. So if you look at the agreement with Allianz, it goes much further than a simple distribution agreement. It is a two-way partnership, where we invest together in technology, in training, in product design, in marketing, in developing the business and increasing the pay in multiple markets, and results for an agreement that will pilot and hopefully what will be an excellent opportunity for doing for selling, or for delivering banking solutions to Allianz clients, particularly 9 million of them in Germany. This is a true two-way partnership that is predicated on developing the respective client franchise potential, providing clients with the best solutions and obviously, developing our business. So we are very happy to have this partnership today. And the way you should look at it is as a blueprint of what we would like to do with all of our partners. And therefore, we will approach any partnerships that we do in this way. Some partnerships are still tied to legacy contracts, and we will honor those contracts, but in any reviews that we may have, we will try to approach our partnership in this fashion. With respect to building things internally, we will build things internally when we think we have a competitive advantage and greater value to create, then agreements such as this one. And this may change from time to time given regulation and other effects. But at this juncture, I am extremely pleased of the agreement and partnership that we have with Allianz.

Thank you

The next question is from Jean-Francois Neuez with Goldman Sachs. Please go ahead. Jean-Francois Neuez: Hi, good morning. I had a question on Russia and I wanted to, I know it's a bit of a scenario analysis or but if as per the news flow, there was a situation whereby the Russian banks would be removed from the SWIFT system, what are the mitigation scenarios and your processes for UniCredit, essentially trying to understand what are the detailed risks there? And the second question I had was with regards to also the point on the due diligence, I think there was a point in the press in the morning that you were looking at potentially having your operation part of a bigger one and a controlling stake. Do you think it's part of these kinds of mitigation strategy that to have some sort of a listing or another partner there or is this unrelated? Thank you very much.

So we, at this juncture, we feel that the measures on SWIFT may have been put on hold. We -- given very impact on the global payment systems, we are constantly evaluating and reviewing, mitigating action, trying to anticipate what the sanctions could be, and how those sanctions would treat different banks and different players. To be honest, we are in scenario analysis, because nothing is clear. What I can say is that UniCredit has been in Russia since 2007 and we have gone through a number of successive iterations of sanctions and ups and downs, and the bank has been well capable to adjust to those and honor and respect all the sanctions that were implemented. So I cannot be more precise in answering your question, just that we are on top of it, and evaluating it. And if there are any developments, and we have a tangible target to focus on in terms of what we need to address, we will definitely get back to you on how we're doing it. With respect to the transaction or more generally on Russia, it is a franchise that has, that while accounting for about 3%, 4% of Group revenues allocated capital, more so in terms of profitability, slightly more so, has delivered, we have 4000 employees on the ground and we are -- we are happy and respect what they're doing and we are happy with what we have. More generally, we always look at possibilities to manage what we have or improve what we have. In this case specifically, without increasing our exposure or risk we thought that a potential transaction such as the one I have briefly explained, would contribute to that under all aspects. But as I said, it was very preliminary and we interrupted, we exited the process and exited the data room, given the geopolitical situation. Jean-Francois Neuez: Okay, many thanks.

The next question is from Andrea Filtri with Mediobanca. Please go ahead.

Yes, good morning. Two questions, one on net interest income, the other on bancassurance. On net interest income, you have given a flat guidance. Could you give us a bit more color regarding the development from here, from the actually the leverage that you have already started and you're planning to do, I'm referring to the 1.3 percentage points of CET1 that you want to [indiscernible] in the business plan. As for bancassurance I heard you on the previous questions, could you elaborate a little bit around the 2024 flexibility clause and how we should read that? Does that give any credit the ability to abandon the partnership in case alternative or strategic options become available? And just a super quick clarification, the Q4 regulatory headwinds that did not materialize, the guidance was below 40 basis points, you did less than 20. Will they come back or they have disappeared? Thank you.

Okay, so in relation to net interest income, so just a reminder, so we are closing above €9 billion as I was commenting before, we are expecting to have net interest income in 2022, in line with 2021, excluding the nonrecurring one off that we had in German in fourth quarter, that was for around €120 million. As a matter of fact, what we are expecting is an increased lending growth in all the region still with some headwinds on the client rates, but especially in Western Europe. In the plan, as a matter of fact 2022 will be a consolidated plan from this perspective, and then we will have a progressive net interest income increase in 2023 and in 2024. The impact of the risk weighted asset optimization during the plan is around €30 billion of risk weighted assets in the period 2020 to 2024, and this is including one-third securitization and one-third on disposal. So, as a matter of fact, in the dynamic of the revenues, these are already factored in and especially are referred to Italy, whose net interest income during the course of the plan will have fundamentally a CAGR closer to zero, slightly above zero taking also into consideration the fact of such action. In relation to the fourth quarter regulatory headwinds, as a matter of fact, the regulatory headwinds were better than expected. We closed the full year with 71 basis point in the full year in comparable with the expectation, the procyclicality effect was lower than expected. And we had the final effect they are having also from models implemented better than expected. All in all, we are not expecting to have a transfer in futures, so these benefits are permanent.

With respect to bancassurance and the agreement with Allianz, so I think you were interested in the strategic flexibility we mentioned in 2024. Let me start with, personally I strongly believe in the kind of partnership we have with Allianz, and I do believe that it will lead to an advantage in terms of product quality, after sales and support to our clients, so pretty much committed on it. Nevertheless, regulation is evolving. We have CRD4 coming. It's not really clear where it's going to land exactly. So we felt it was our duty to keep some flexibility in 2024 if the regulatory environment changed to such an extent that economics would shift to such an extent that it would lead us to having to reconsider to an internalization. At this point in time, I absolutely don't expect that also because the areas that we are focusing with Allianz are less affected by "capital" in inverted commas, and more affected by efficiency and therefore margins on the product and the quality of the product and the service we provide. I think that was it, wasn't it?

Thank you, very much.

Your next question is from Antonio Reale with Morgan Stanley. Please go ahead.

Hi, good morning, everyone. Thanks for the presentation. I have two questions, please. The first one is a followup on Stefanos comments on NII, and the second more largely on how you think about capital allocation within the Group. And so on the NII, can you talk a bit more about how your NII commentary on the Group level breaks down across your key divisions in Italy, Germany, Eastern Europe and Austria, please? And secondly, your plan to distribute capital, improve returns, you’ve talked about shift in the business for more capital light fund as part of your CMD [ph] necessarily implies proactive review of your capital allocation across geographies and products and we're seeing that come through. I think on the product side, your views are very clear at least to me. We've seen what you're doing on leasing, you talked about insurance, et cetera. I'd like to ask you on your pan European presence consistently what you've said on Russia. My questions will be more general, how do you see the business rationale in some of these countries you're in, especially in Eastern Europe compared to your returns on invested capital, market shares and cost of equity? Thank you.

Okay. Maybe let me start from the last one, pan European presence? And how do we look at every country and the business rationale for being there, and for doing whatever we do there. So the way I look at it is, if we are exceeding the cost of equity, risk adjusted, of the local countries in which we are, over the year and over the foreseeable future, this is a value creation for shareholders, by definition and that works and therefore we are committed to stay. At the moment, every single country, either is either exceeding its cost of equity locally or very close to be exceeding its cost of equity after the measures that we have announced in the plan. So, on that basis, I start from the point of view, that we have deployed the capital in those markets in a way that is adding value for shareholders, and benefiting from the diversification and the portfolio management that we have more at group level. Okay?, so that's point number one. Point number two, over time, if they are position in those markets, where we believe we can increase that value creation and depending on the market that we are considering, without shifting our risk in a way that is not considered acceptable by our shareholders and we have a pretty good view of that, we will strengthen our franchise wherever we can strengthen it. Thirdly, we believe that due to the Group aggregation, and the centralization and unification that we're doing to client solutions to digital and data, to a lot of other things, and this for me is the benchmark, the true benchmark, we will be able to outperform most local competitors, by leveraging a franchise that is already run efficiently as it is, but that can leverage scale effect and better quality of product effect from being part of UniCredit. And that's the balancing that we're trying to achieve, because if that is not the case, UniCredit as the Group would not be adding any value to the single markets and that's how we look at it. In terms of capital allocation, I would say the following. At the moment, we have, we start from a position where we have too much capital, not too little. So we don't have a constraint on the amount of capital that we can allocate. So then, the way we look at it is, does it exceed cost of equity on a risk adjusted basis? And obviously, the cost of equities of our markets are very different. If it does, it's worth pursuing and deploying. If it does not, it is not worth pursuing and deploying. So at the moment, we have the advantage of having the capacity. That may change at some point, but at the moment, it doesn't. But we have very disciplined with saying is not because we have the capacity that we're going to deploy it, we're going to deploy it, if your country are going to show me not on average, but opportunity, but opportunity for deployment that is ahead of your cost of equity, obviously if it's fees, it's rather easy. If it's NII, it requires a lot more targeted discipline. And this is the foundation of how we look at it.

Net interest income, so I will give you more flavor from a geographical perspective on this year, but also in relation to 2022 and the plan. So in relation to this year, and specifically to the quarter, as we were commenting the quarter net of non-recurring item is stable. When we're looking to the geography, Italy is stable as well. So we close around €890 million in the quarter with stable loans. With regards to Germany, Central Europe and Eastern Europe, first we had growth of lending in all the free geographies. Overall the other average increase of the stock or loans in the quarter was around €6 billion. If you look at the increase of the stock in the quarter, so December versus September was between €11 billion and €12 billion. With regards Germany as a matter of fact, net of the one off fundamentally the net interest income was in line, Central Europe we had an increase in the quarter around €30 million, quarter-on-quarter, and Eastern Europe we were up in the quarter as well for around €30 million. To be underline the increase on average that positively impact the especially Central Europe and more specifically, Czech Republic and Hungary. In relation to the net interest income that we are expecting in 2022 and for the plan, with regards, Italy as a matter of fact, we are expecting a reduction of the net interest income during the course of 2022 and then stabilization and then progressively an increase during 2023, 2024. In Italy in 2022, the impact is also deriving from on one end, the front book pricing in comparison with the back book and the rollover of the investment portfolio, so not the commercial side, but the investment side of the portfolio. In Central Europe and Eastern Europe on the other hand, these are the location where we're expecting a progressive increase of the net interest income due to dynamic of the rates especially in Central Europe and in both of the countries also an increase of the lending.

Thank you both, very clear.

Your next question is from Alberto Cordara with Bank of America. Please go ahead. Mr. Cordara, your line is open. Mr. Cordara, we cannot hear you, are you on mute? The next question is from Andrea Vercellone with BNP Exane. Please go ahead.

Good morning. Just two questions on the same aspects. On the assets on IFRS5, it is Italy, it is in Germany, I understand, can you disclose as an estimate or what are the risk weighted assets of the revenues and the costs attached to these assets? And can you confirm that you will continue to book them until you sell them also in 2022? And specifically, your guidance on net interest income for 2022, which is take 2021 subtract the one-off in Q4 and that's what you're guiding for, does that include contribution from these IFRS5 assets or not? Thank you.

Yes, so the guidance is including the effect, also deriving from IFRS5 assets, more specifically in relation to the effect, continued effect deriving from the allocation, the loans are not any more considered in the loan stock for in the allocation that we did at the end of the year, but in relation to the P&L contribution. The P&L contribution is confirmed and so it will contribute to the different levels, revenues included during the course of 2022. So in relation to the amount, the amount of loans in relation to Italy is around €10 billion. The amount of risk weighted asset is close to €8 billion, and the overall revenues is around €200 million. This is the portion of the leasing connected to Italy. With regards to Germany the activity is, let's say to a different extent in comparison with Italy as a matter of fact the total risk weighted asset that we're referring to is around €1.5 billion, and the contribution to the revenues is lower because it is around €40 million.

And costs?

On the costs side, on the costs side, leasing in Germany is €30 million of costs, while leasing in Italy, clearly the operation is bigger and it is around €60 million.

Thank you.

[Operator Instructions] The next question is from Delphine Lee with JPMorgan. Please go ahead.

Yes, good morning. Thanks for taking my questions. I just have two. So first of all, just wanted to go back very briefly on the M&A strategy as a followup. Can you maybe just clarify in terms of M&A interest on bolt-ons? And, what geography are you prioritizing? And just trying to think about, understand your approach on capital allocation, and then just wanted to kind of like understand a bit what areas of interest or what businesses? The second question is on the cost guidance for 2022. I don't, you don't have, still don’t have one, but if you could maybe just give us a bit more color on that one? There is definitely a little bit of, you mentioned already CMD [ph] that you would have some savings coming through already in 2022. So if you could just clarify that, just trying to reconcile a little bit €200 million net profits decline to €3.3 billion where was that coming from? Thank you very much.

Thank you, Delphine. So M&A, so obviously given what I said before, we believe we have opportunities in all the markets in which we are. In some markets, we have critical mass or we have the presence that we want to have and some others maybe we do not. What we do, or rather, what our strategy, and I mean the team does non-stop is to look at any inorganic opportunity to strengthen our franchise in the geographies that we're targeting and then we evaluate it. If there are opportunities that make sense and that are available, we review them. And we review them, usually clean fashion applying what I have said at the beginning of the call. We have committed, I have committed to certain targets in terms of profitability, in terms of risk profile, in terms of distribution in excess of €16 billion and sustainable distribution thereafter. And whatever we do in M&A, you should not expect that it could derail in any way those targets. So putting it more clear, we will not do M&A if there are other risks to make, to slowdown our distributions or to not create the organic capital generation model, and therefore organic capital distribution model that we intend to create. And on that basis, obviously, for us to do M&A, given the value that we have internally, and the value of everything else, it needs to, it has a pretty high bar. The return on investment needs to be quite high and it depends on the geography where we are. It needs not to derail the plan, not to derail the execution of what we're doing. And that inevitably pushes us towards, if we ever did any, more bolt-on rather than anything significant. So at the moment, I can't tell you more than that, because it's a frame for us to do. But I think what I can tell you is, we will not, I will not pursue something that derails the objective of a plan and in particular the capital return on the plan.

In relation to the cost, as we disclosed at the Strategy Day, we are action already defined that can affect both HR and non-HR costs. So we will have a progressive improvement in relation to these actions already during the course of 2022. More specifically, important to mention the potential difference of inflation and compared with the assumption that we've been communicating at the Strategy Day, and as a matter of fact, the inflation that currently we are expecting during the course of 2022 is around 4% for Central Europe, and it is around 4% for Eastern Europe as well, while in Western Europe, we are expecting 3%. However, notwithstanding this, we are expecting that costs will be in line in 2022 in line in comparison with 2021.

Thank you very much.

Next person I guess?

Your next question is from Alberto Cordara with Bank of America. Please go ahead.

Hi everybody, sorry for before. Just I was looking at your balance sheet in Q4 you have the cash on the balance sheet, so €107 billion versus €135 billion in Q3. So there has been a reduction on the liquidity, but do you see materially the €35 billion that you had at the beginning of 2020. So it seems to be that there is still a good amount of liquidity that is probably re-deposited with the CD [ph]. So the question to you is, how are you going to cope with the change in [indiscernible] conditions that we are going to see in June 2022 and what is going to lead to the, so will it impact is fairly on your P&L? And then my second question is connected to that. What are the commercial policies which are the initiatives that you're taking to reactivate volume growth in Italy that seems still a bit [indiscernible]? Thank you.

So yes, in relation to the liquidity position, and balance sheet position, as a matter of fact, during the course of the fourth quarter, we've been experiencing a reduction of deposit, especially with financial institution and large corporate in Germany, fundamentally connected we have the application of balance outcome fees at year end. So it's not a structural change, but that is a point in time change. As a consequence of that, the liquidity position that we have towards Central Banks has been reducing compared with the average of the year, but as a matter of fact, is still around €100 billion. With regards the strategy in ration to the TLTRO3, the strategy is unchanged, i.e. we will be progressively reimburse TLTRO3 not point in time in June 2022. And that is not specific and relevant impact in relation to other funding plan or commercial strategy deriving from such a reimbursement. And in relation to the contribution to the net interest income, the contribution to the net interest income of TLTRO3 has been a little bit higher than €360 million during the course of 2021. We are expecting a similar contribution. Let's say a few millions lower during the course of the 2022 as well. With regards the commercial actions in Italy as matter of fact are already in place, just to give you some flavor in relation to the market share on new production, on consumer financing. The average during the second half of 2021 was around 11 percentage points on consumer financing, and around 15 percentage points on mortgages, while our market share in relation to corporate was around 12 percentage points. So from that perspective, the commercial actions are already there, keeping in mind that we will be let's say selective and focused in relation to the proper lending with the proper level of return on allocated capital, especially in the corporate space.

Yes, and I would like to add to Stefano, so that we're clear. Obviously, approaching maximization of return on tangible equity and maximization of organic capital generation as a model, as opposed to volume also means that our NII gross is naturally restrained by not growing in segments or areas where we think we do not cover the customer equity or the trade-off with capital generation is negative. So I'd like to look at it as a quality growth in NII, but obviously like our quality growth, they may be slower than lesser quality growth. And I think this is for us very important in terms of discipline in the network across that we want to obviously, both develop our lending and develop our fees. But the lending needs to hurdle, and that means that we don't do all the lending, as Stefan has indicated.

Very clear. Many thanks.

The next question is from Ignacio Cerezo with UBS. Please go ahead.

Yes, hi, good morning. Thank you for the presentation. Can I have a follow up on the leasing business if you can give us the net profit, net loss contribution of the business in 2021? And when do you expect that to be disposed, actually at least qualitatively throughout the year? And then the second one is, when is the official submission of the capital return plan to the ECB? And when should we expect some degree of approval in communication on that? Thank you.

Yes, in relation to the capital and the related submission, the submission is immediately after the Board in relation to their request for the share buyback that we've been mentioning. So the €2.6 billion, so let's say in these days, and as we were commenting, we will have the AGM at the beginning of April. So by that time, we're expecting to have the authorization by ECB. With regards to the leasing side, the contribution in Italy to the profit in terms of consolidated profit underlying was around €60 million.

Thank you.

The next question is from Azzurra Guelfi with Citigroup. Please go ahead.

Hi, good morning. Two questions. One is on the risk-weighted asset evolution over 2022. If you can give us some color of the development and if it's fair to assume that they will decrease the first and then continue to increase in 2023 and 2024? The second one is a little bit more asking on the commercial operation and how the network and the client have reacted to the presentation of your plan, especially in Italy, because the Group was not very, if you want aggressive in terms of growth, and focus on the activities in the Italian business. And so, I wanted to know if there have been any if you want, clients welcoming the change of speed, and if it is impacting, if you want, the trend in terms of volume and asset management product for 2022?.

Yes, in relation to risk-weighted asset during the course of 2022, we are expecting an increase of the risk-weighted asset deriving from business evolution, because as was commented before, we are expecting to have lending growth in the regions coherent with the increased level of the GDP. During the course of 2022 we will also put in place some of the actions of the plan, both in relation to disposals and in relation to securitization, so this is the part of the plan. With regards regulatory headwinds, we are expecting on average in the plan, so between 2022 and 2023, it will have an average around 15 basis point of regulatory headwinds. As a matter of fact, such an amount is more skewed towards 2022 where we're expecting to have some model changes and calendar provisioning impact even if it's not meaningful during the course of 2022. All in all, we are expecting to have a focus on the risk- weighted asset that will generate also positive capital regeneration from the risk-weighted asset management during the course of 2022. I remember you that in the plan, we are expected to have an average of organic capital generation in relation to risk-weighted asset on average of 20 basis points per year.

So, with respect to what we're doing commercially in Italy, I think it is -- number one it's early days, but we are optimistic about the signs we're seeing, both from our employees and our clients. As you know, we have executed a change in the geometry of our network in Italy fundamentally putting more people on the front line and those changes have slightly slowed us down in December, but now they are -- all of our people at a full speed. So we need to see how Q1 maps, but the early signs are positive and both from clients and from employees. So I think those things reinforce our confidence with respect to what we can deliver this year and the following years, but we will have more detail in Q1.

Operator?

The next question is from Daniel David with Autonomous. Please go ahead.

Good morning, and thanks for taking the questions. On the CASHES securities, did you expect to pay the coupon on those securities? And could you provide a bit more detail on the adjustments that go into that calculation? Thanks.

Yes, in relation to the CASHES the payment of the cash in is subject to conditions under the terms and conditions. So, as a matter of fact, we have three conditions that should be met for having the payment, one is the relation to adjusted consolidated profit. The second one is that the cash dividend should be paid in relation to the previous financial year and then there is a positive difference between the adjusted consolidated profit and the cash dividends. So in relation to full year 2021, there is a positive adjusted consolidated profit and as we were commenting, there will be a cash dividend paid following our proposal. More specifically, based on the preliminary figures, and clearly subject to the relevant approvals, i.e. the financial statement will be approved by the next Board and then we have the AGM in April. The adjusted consolidated profit is around €1,240 billion and the proposed cash dividend is 1 billion and 17 billion, so €1.17 billion. So, the maximum amount to be paid as a consequence of the terms and condition is around €74 million, which represents 60% of the full year installments that based on the current year EURIBOR rate is 122. So there is a management discretion overlay in case all the conditions are not met. However, I don't believe it's appropriate to subjective apply such an adjustment. So you need to take into consideration as I was referring before, that the amount to be paid will be around €74 million. So that is representing 60% of the full year installments.

Thank you.

[Operator Instructions] The next question is from Giovanni Razzoli with Deutsche Bank. Please go ahead.

Hi, good morning, everybody. I will stick to one question, if you can please elaborate a little bit more on the credit risk profile of your clients one month after the expiration of the moratorium and 24 months after the launch of this measure, what is the, how was the risk profile and also, what is the outstanding amount of the moratoria as of December? And what are the assumptions that you have made on the 30, 35 basis points cost of risk in 2022 in terms of default rate and integration of those asset classes?. Thank you.

So in relation to the loan under moratoria, as a matter of fact we are remaining at the end of 2021 with €1 billion, everything in Italy. The loan under moratoria whose package expired is around €30 billion at Group level. As a matter of fact, the dynamic of the migration rate, when the, of these clients is in line with the expectation. With regards the default rate that were at Group level during 2021 was 1.2. So as a matter of fact, below the level of the full trade that we had during 2020, fundamentally in line with the level of default rate that we had in 2019, while what we are expecting for 2022 is a slight increase of the default rate, but not a meaningful one. And we are expecting to be at similar level of default rate during the course of the plan.

And Stefano, you mentioned 1 billion of moratoria outstanding?

Yes, so just 1 billion because all the other 1.6 [ph] billion expiring, yes.

Okay, thank you.

The next question is from the Domenico Santoro with HSBC. Please go ahead.

Hello, hi. Good morning. Thanks for the presentation. Just a quick question and a quick clarification about the asset management. I just wonder whether at the point, the flexibility of changing the partnership terms even ahead of the natural expire of the partnership, and that will be of course, extremely helpful to grab additional areas compared to other competitors that they have the company has? And a clarification on the loan loss provision how long or whether lower loan loss provision in the [indiscernible] translate also in a lower amount in absolute terms for 2022? Thank you.

So in relation to LLPs as we were commenting, were expecting to have a range in 2022, in line with the plan one, so between 30 and 35, that as a matter of fact, is bringing to overall LLP that are slightly down in comparison with 2021.

In relation to asset management, two things, the first one is, as of now our view is that you are winning asset management, manufacturing, either through scale or through category killer segments that you develop in-house. We do not believe we can achieve any of these two. And we also believe that we've MiFID II being increasingly rolled out seriously everywhere, it is very difficult to ensure best product and best management if you do not have one of those two advantages. So at the moment, as I said before, we do not see internalization as a, “positive options" for us to pursue. That does not mean that we haven't and are developing, let's call them intermediate in-house skills, in terms of repackaging and combining third party products to improve the quality of what we deliver to our clients in Italy and elsewhere, which we are doing, and is already providing some good results. With respect to our more general agreement in CNS [ph] and management elsewhere, I think you should consider that if there is a contract, we will honor it. As they roll, we will pursue partnerships as I have defined them, like the one we have pursued with Allianz.

Thank you.

The next question is from Benjie Creelan-Sandford with Jefferies. Please go ahead. Benjie Creelan-Sandford: Yes, good morning. Thanks for taking the questions. The first one was just a followup on fee income and the guidance for slight growth in 2022. I was wondering if you could maybe just discuss a little bit the upside and downside risks around that guidance? I mean, thinking about the downside risks, I guess, just on the asset management and the insurance fee contribution, how sensitive do you think they are to the market backdrop? And I guess asked another way, I mean, what assumptions have you sort of made about the general direction of those markets in that guidance? And on a more positive side, in terms of the transaction fee, CIB fees and then things like that, do you still think that there is some natural catch up, still pending in 2022 and the ongoing reopening, et cetera or do you think that most of the COVID related headwinds have already been recovered in the current numbers? The second question is just a quick followup on the buyback, it sounds from the earlier comments that you had hoped if all goes well, that you'd be in a position to commence that buyback in April, potentially and it's obviously quite substantially larger than the current ongoing buybacks. I'm just wondering if you have any thoughts on the timeframe over which you'd expect to execute that buyback if approved? Thank you.

Yes, so in relation to the dynamic of the fees, and let's say, positive and negative potential outcome that we might have, so as we were commenting, in general we are expecting a normalization of the upfront fee component of the investment fees in a general positive environment. Having said that, it's important to point into, point the attention to the macroeconomic situation and to the potential market volatility, but having said that, take into consideration the start of the year. So the first weeks of January, the trend that we saw during 2021 in Q4 it confirmed, both in relation to the gross sales and in relation to the dynamic of the asset under management. In relation to the financing fees as our comment before, that is connected to the lending dynamic. We are -- we did well in Q4 and so we are expecting to other contribution to the fee component, i.e. loans and guarantees that are going from the lending dynamic. So depending also the overall evolution of GDP, we might have also some implication in relation to these components that however, we are expecting to be positively performing during 2022 in comparison to 2021. With regards to transactional fees that is connected with the activity of our clients. And as a matter of fact, we are expecting an acceleration following the further easing of the restrictions during the course of the year, clearly assuming a stabilization of the situation in relation to the pandemic. With regards to the buyback, yes, we are expecting to have the approval before the AGM and then we have the AGM. So as a concern of that we will start accordingly, the buyback is clearly higher, because it's €2.6 billion and compared with 652, we will be mandating a third party in order to buy that, and as a consequence, as per, let's say market standard, they will buy within specific limits in order not to influence the dynamic of the stock, so within the market related parameters. Benjie Creelan-Sandford: Thank you.

The next question is from Britta Schmidt with Autonomous Research. Please go ahead.

Yes, hi, there. Most of my questions have been answered; just one and I might have missed it. Are there any day one related inputs to the restructuring of the Allianz agreement that we need to bear in mind? Thank you.

No, there are no one off, not according to, in fact in relation to the finalization of that agreement.

Great, thanks.

The next question is from Hugo Cruz with KBW. Please go ahead.

Hi, thank you for the time. Just two questions. So I think you mentioned that inflation is a bit higher than you expected at the time of the strategy update. So could that have any impact in your longer term targets? And when do you expect to see OpEx falling sequentially to the Group level? And then similar on NII, when do you expect, it sounds like NII in Italy will continue to be in the pressure and will be flat during the duration of the plan, so when should we see an inflection point where Italy and NII starts to grow again is the question? Thank you.

Yes, so in relation to inflation, as I was commenting, so the inflation is expected to be higher than the plan, a little bit more in Western Europe, more in Central Europe and Eastern Europe. As a matter of fact, with inflation it's important to bear in mind that we will have consequences also on the rate side like what we are seeing in Russia or in Hungary and Czech that is positive for us, like happened already in Q4. So in relation to the cost dynamic, as a matter of fact, our action has already demonstrated during the course of 2021, such to be able to manage the management of the operation in Central Europe and Eastern Europe with cost dynamic below the level of the inflation. And with regards to the implication of their rates, as was commented before, we're expecting a positive dynamic to the net interest income in some of the Central Europe country deriving from the dynamic of the rates. More specifically, in relation to the plan, we're expecting to have for the net interest income a consolidating year in relation 2022 are expecting a progressive increase of the net interest income from 2023 onwards.

Okay, thank you.

The next question is from Anna Benassi with Kepler. Please go ahead.

Yes, good morning all. My question is related to the disposals of NPs and ETPs in Q4. I see they are both declining in gross terms by 2.3 million each, I'm wondering what have been trends between organic reduction, I hear about moratorium that is the whole data and I see the main contribution through the higher European peaks 1 billion growth on short term? And then sorry, again on bancassurance generally release these agreements as the direction of concentrating this business by the way of expanding of this further on the basis for the [indiscernible] truth can you guide us the direction with one not largest provider? Thank you very much.

So, the disposals that we have done, NP during the course of 2021 more especially in Q4 are coherent with the strategy and the full rundown of the Non Core that happened, so as a matter of fact, this is the last quarter where we are also including the results from the Non Core divisions. So, the full rundown is confirmed and so, starting from 2022, we will not have any more the Non Core division. So, as a matter of fact, the related NP contribution will be fundamentally disappearing. With regards to the strategy or disposal during the plan we are also assuming some NP disposal during the plans. So in the horizon of the plan in 2020 to 2024, around €3 billion, such disposals are more skewed towards 2022. So, we are also expecting to still having some NP disposal during the course of this year.

Maybe I didn’t understand the answer to what was the level of disposals in Q4, maybe I need to back off?

Hi, this is Magda from IR. It is a very bad line. We can hardly hear you. So someone from the IR team will speak to you after the call. Thank you.

Okay, thank you.

Maybe I'll, if you can hear me well, I will mention on bancassurance. So number one, yes, we are rationalizing our partnership. As you know, we had several of them across Italy and then across the rest of our regions. It is obviously better for us to deal with a concentrated number, a more concentrated number of partners. I do not expect this to go to one at this point in time, just because different partners have different appetite and different expertise per product. But it will be substantially rationalized down and we will keep you posted on that.

Thank you.

The next question is from Tom Jenkins with Jefferies. Please go ahead.

Hello. I hope you can hear me. Couple of questions, as you have dominance around 111 topic versus the CASHES and so the question you had earlier, maybe I misunderstood or could you clarify please, that you anticipate spending not the full EURIBOR plus 450 coupon or you think it's going to be fixed expense of that, did I understand that right or not?

Let's say in relation to the CASHES, the CASHES coupon is fundamentally EURIBOR plus 450 basis points, i.e., the overall amount is depending also on the evolution of the EURIBOR in the next year. So we can only do an estimation of the expected, let's say, level of the EURIBOR and as a consequence, quantifying which is the yearly installments, that's why I was referring to the EURIBOR. So if we're using the carrying forward [ph] for the EURIBOR, the installments at the current level of your EURIBOR, would be around 122. Having said that, following the application of the conditions, the amount to be paid is around 74, so 60% of that amount. So the reference to the EURIBOR was done just to tell you that it's a preliminary consideration, because there EURIBOR can change over the time.

Of course, we know that EURIBOR hasn't changed for an awfully long time, and it probably won't over the next few months. So what I'm asking you very, very plainly is, are you going to pay the full coupon, in -- starting in May?

It is only 60%, so if you look the overall the accumulated coupon of the next period, so in relation to full year 2021 and taking into consideration the condition, the amount to be paid will be equal to the 60% of the cumulative coupon, i.e., 74 out of around 122 million [ph].

Okay, all right. Thank you very much.

Is that right?

Yes, that’s clear. So the next question is, what do you, what have you guys got thinking about these CASHES in respect of, obviously, EURIBOR is sort of dying in a couple of years, is there any strategic sort of development that you have with what you want to do with them being not exactly premium capital?

So Tom, this is Andrea. Look, I think, CASHES is obviously an instrument that is very specific to UniCredit. It is not -- it doesn't effectively fit in any bucket. It's kind of a hybrid, if I want to call it this way. So for us we will apply the conditions, and we will give certainty by applying those conditions they way they should be applied and it's a long dated contract. We are not the issuer. We have limited to no visibility on the investors. We will continue to apply those conditions. I do not believe, but Stefano can correct me, that we have an early call. I think some have asked us whether we would swap them or do something with it. Again, it's given that we don't have an early call, it's not our decision. But it is always a difficult question, because it's an investor base and a product that does not fit a little bit in comparison to anyone else.

Sure. Sure, okay. What -- basically all I'm trying to find out is, are you going to, is mostly, are you going to pay the anticipated coupon? So we know how to value it, because it is 3 billion worth of, or 2.983, whatever it is, of debt equity/ debt outstanding. And so we're just trying to work out how we value that? And then your forward thoughts, which I understand are limited by regulatory constraints, but if I'm understanding you correctly, you both then I'm basically saying we're going to get EURIBOR plus now I know 60% was that 270 over 60 to 450, and that's probably the coupon you're anticipating payments here. Is that correct?

Yes, it's correct, i.e. 60% of the expected coupon. Yes, based on that.

Okay, wonderful. That's absolutely fantastic. Thank you, guys. I just, will just be quick, but I do like it and unresponsive. Thank you very much.

Thank you.

Your next question is from Andrea Lisi with Equita. Please go ahead.

Hi, good morning. One question on the stage two loans, if you can provide us an indication about the revolution in the fourth quarter? And just a clarification, if the charges related to the layoff plan recently signed with the unions are already fully expressed in the fourth quarter results? Thank you.

So yes, in relation to the loan dynamic we are not taking consideration of the IFRS5 allocation that we had in Q4. We are up quarter-on-quarter for around €11 billion, €12 billion of commercial loans. So the average of the stock of loans is up €6 billion. More specifically, Italy is flat quarter-on-quarter while we had an increase in both Germany, Central Europe and Eastern Europe, Germany around €4 billion while Central Europe and Eastern Europe €6 billion each.

Yes sorry, my question was on the stage two loans.

On the stage two loans, sorry. So in relation to the stage two loans, we had an increase in the quarter of around €26 billion, i.e. we moved a total amount of stage two loans to around €95 billion. So this is coherent with some regulatory changes that affected also regulatory given LLP and as a matter of fact, such a change created an effect also on the amount of stage two loans that have been moved from stage one to stage two. So there is no change in the underlying risk of declines is due to a fine tuning of the IFRS9 transfer logic.

Thank you.

Mr. Orcel, this concludes the Q&A session. The floor is back to you for any closing comments.

Thank you very much for your time, and thank you. Have a good day.

Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones.