Half Year 2026 Mandatum Oyj Earnings Call

August 13, 2026

Lotta Borgström: Good morning everyone, and thank you for joining Mandatum's Q2 2026 audiocast. My name is Lotta Borgström from Investor Relations, and I am pleased to be joined today by our CEO, Petri Niemisvirta, our CFO, Matti Ahokas, and as a special guest, the Head of Asset and Wealth Management, Janne Sarvikivi. During this audiocast, we will begin by presenting the highlights and key developments from Mandatum's second quarter of 2026. We will also comment on the announced acquisition of the Swedish asset manager, Cliens, which was communicated earlier this morning. Following the presentation, we will proceed to the Q&A session, where you will have the opportunity to dial in with any questions you may have. Participants can also submit questions through the chat, which we will review within the available time after the dial-in Q&A.

Speaker #1: During this audio cast, we will begin by presenting the highlights and key developments from Mandatum's second quarter of 2026. We will also comment on the announced acquisition of the Swedish asset manager, Cliens, which was communicated earlier this morning.

Speaker #1: Following the presentation, we will proceed to the Q&A session, where you will have the opportunity to dial in with any questions you may have.

Speaker #1: Participants can also submit questions through the chat, which we will review within the available time after the dial-in Q&A. As stated, Janne Sarvikivi is joining us for today's call and will be available to comment.

Lotta Borgström: As stated, Janne Sarvikivi is joining us for today's call and will be available to comment on the transaction and answer related questions later in this audiocast. With these remarks, I will hand over to Petri. Please go ahead.

Speaker #1: On the transaction announcer-related questions later in this audio cast. And with these remarks, I will hand over to Petri. Please go ahead.

Speaker #2: Thank you, Lotta, and thank you all for joining us today. The second quarter was a strong one for Mandatum, with good results across the board.

Petri Niemisvirta: Thank you, Lotta, and thank you all for joining us today. The second quarter was a strong one for Mandatum, with good results across the board. Our capital-light profit before taxes increased by 32% year on year to EUR 27.1 million. This demonstrates the strength of our strategy and the continued growth our core business is. The market environment was supportive during the quarter. As a result, our client assets under management increased by 16% year on year to a record EUR 16.7 billion. Net flow remains solid at EUR 164 million and stayed at the same level as a year ago. The strong growth in assets supported our fee result, which increased by 21% to EUR 22.4 million. The group's profit before tax more than doubled from the comparison period and reached EUR 79.1 million.

Speaker #2: Our capital-like profit before taxes increased by 32% year on year to €27.1 million. This demonstrates the strength of our strategy and the continued growth of our core businesses.

Speaker #2: The market environment was supportive during the quarter. As a result, our client assets under management increased by 16% year on year to a record €16.7 billion.

Speaker #2: Net flow remained solid at €164 million and stayed at the same level as a year ago. The strong growth in assets supported our fee result, which increased by 21% to €22.4 million.

Speaker #2: The group's profit before taxes more than doubled from the comparison period and reached €79.1 million. The result was supported by a strong net finance result and good investment returns from our own with-profit balance sheet investments, particularly fixed income assets benefiting from tightening credit spreads.

Petri Niemisvirta: The result was supported by a strong net finance result and good investment returns from our own with-profit balance sheet investments, particularly fixed income assets benefiting from tightening credit spreads. Alternative investments and especially private equity investments also performed well. Let me then move on to client assets under management and net flow. Client assets under management reached a new record of EUR 16.7 billion at the end of June. Client assets increased not only in Asset & Wealth Management, but also in our corporate and retail businesses, in which the equity weight of investment is typically higher. This broad-based growth highlights the importance of all our business areas for Mandatum's profitability and demonstrates the strength of our diversified business model. Net flow remained positive in all our key business areas during the H1 of the year.

Speaker #2: Alternative investments, and especially private equity investments, also performed well. Let me then move on to client assets under management and net flow. Client assets under management reached a new record of €16.7 billion at the end of June.

Speaker #2: Client assets increased not only in asset and wealth management, but also in our corporate and retail businesses, in which the equity weight of investment is typically higher.

Speaker #2: This broad-based growth highlights the importance of all our business areas for Mandatum's profitability and demonstrates the strength of our diversified business model. Net flow remained positive in all our key business areas during the first half of the year.

Speaker #2: Asset and wealth management generated the majority of net flows, while corporate also continued to contribute positively. In corporate business, sales of pension insurance products and personal funds remained at a good level.

Petri Niemisvirta: Asset & Wealth Management generated the majority of net flows, while Corporate also continued to contribute positively. In Corporate business, sales of pension insurance products and personnel funds remained at a good level. In Retail, our cooperation with Pohjantähti continued to support risk insurance sales, and investment product sales returned to growth. Retail assets under management increased to more than EUR 4 billion. We are also encouraged by early signs of improving economic activity in Finland. A gradual recovery in the economy, including increasing M&A activity, is expected to support both our Asset & Wealth Management business and our corporate customer business going forward. This creates new opportunities for client growth and advisory services. Asset & Wealth Management continued to deliver strong growth during the quarter. A particularly positive development was the continued success of our international institutional business.

Speaker #2: In Retail, our cooperation with Pohjantähti continued to support risk insurance sales, and investment product sales returned to growth. Retail assets under management increased to more than €4 billion.

Speaker #2: We are also encouraged by early signs of improving economic activity in Finland. A gradual recovery in the economy, including increasing M&A activity, is expected to support both our asset and wealth management business and our corporate customer business going forward.

Speaker #2: This creates new opportunities for client growth and advisory services. Asset and wealth management continued to deliver strong growth during the quarter. A particularly positive development was the continued success of our international institutional business.

Petri Niemisvirta: International institutional asset increased by 19% year on year, driven mainly by growth in Sweden. During the quarter, we also won our first clients in Italy, further strengthening our position in Europe. Private wealth management asset increased by 18% year on year and exceeded EUR 5 billion for the first time. Growth was supported by strong sales of discretionary mandates and continued client confidence. We are pleased with the strong momentum in this business. One of our strategic ambitions is to double our market share in Finnish private wealth management during the strategy period, and the current development shows that we are moving in the right direction. We have continued to invest in future growth through new hires, among others. While these investments temporarily increase cost, we believe they will accelerate growth and strengthen our position in the coming years. We also made excellent progress in fundraising.

Speaker #2: International institutional assets increased by 19% year on year, driven mainly by growth in Sweden. During the quarter, we also won our first clients in Italy, further strengthening our position in Europe.

Speaker #2: Private wealth management assets increased by 18% year on year, and exceeded €5 billion for the first time. Growth was supported by strong sales of discretionary mandates and continued client confidence.

Speaker #2: We are pleased with the strong momentum in this business. One of our strategic ambitions is to double our market share in Finnish private wealth management during the strategy period, and the current development shows that we are moving in the right direction.

Speaker #2: We have continued to invest in future growth through new hires, among others. While these investments temporarily increase costs, we believe they will accelerate growth and strengthen our position in the coming years.

Speaker #2: We also made excellent progress in fundraising. During the quarter, Mandatum created opportunities to raise more than €300 million in its first closing, and private debt aid secured over €100 million of commitments.

Petri Niemisvirta: During the quarter, Mandatum Credit Opportunities to raise more than EUR 300 million in its first closing, and Private Debt VIII secured over EUR 100 million of commitments. This demonstrates investors' trust in our expertise and long-term track record. Finally, a few words on profitability and efficiency. Our cost-income ratio remained at a healthy level of 49%. On a rolling 12-month basis, the ratio improved by four percentage points year on year. We have continued to invest in selected growth areas, especially within Asset & Wealth Management. Despite these investments, we have maintained a very strong level of efficiency. Our fee margin remains stable at 1.12%. While business mix effects continue as Asset & Wealth Management grows faster than other businesses, underlying product margins remain stable. This reflects good pricing discipline across our operation. Overall, we continue to see clear evidence that our business model is scalable.

Speaker #2: This demonstrates investors' trust in our expertise and long-term track record. Finally, a few words on profitability and efficiency. Our cost-income ratio remained at a healthy level of 49%.

Speaker #2: On a rolling 12-month basis, the ratio improved by 4 percentage points year-on-year. We have continued to invest in selected growth areas, especially within Asset and Wealth Management.

Speaker #2: Despite this investment, we have maintained a very strong level of efficiency. Our fee margin remained stable at 1.12%. While business mix affects continue as asset and wealth management grows faster than other businesses, underlying product margins remain stable.

Speaker #2: This reflects good pricing discipline across our operation. Overall, we continue to see clear evidence that our business model is scalable. We are growing assets, increasing earnings, maintaining efficiency, and investing for future growth at the same time.

Petri Niemisvirta: We are growing assets, increasing earnings, maintaining efficiency, and investing for future growth at the same time. With that, I will now hand over to Matti, who will go through the financials in more detail.

Speaker #2: With that, I will now hand over to Matti, who will go through the financials in more detail.

Speaker #3: Thank you, Petri. Let's now take a closer look at the second quarter result components. As pointed out, our fee result was up by 21% year-on-year, with assets under management up by 16%, and both of these are at all-time high levels.

Matti Ahokas: Thank you, Petri. Let's now take a closer look at the Q2 result components. As pointed out, our fee result was up by 21% year-on-year, with assets under management up by 16%, and both of these are at all-time high levels. Compared to Q1, our AUM was up by 8% or EUR 1.3 billion to EUR 16.7 billion. The main driver for this quarter was the strong market performance of our corporate and retail assets, which have a higher equity weight than our Asset & Wealth Management segment. As Petri mentioned, the cost-income ratio of our client AUM was 49%, actually slightly down quarter-on-quarter. Our income was up in Q2, but the increased growth initiatives in the capital-light business meant that costs in this area increased as well. This is in line with our business plan, as you know.

Speaker #3: Compared to Q1, our AUM was up by 8%, or €1.3 billion, to €16.7 billion. The main driver for this, this quarter, was the strong market performance of our corporate and retail assets, which have a higher equity weight than our asset and wealth management segment.

Speaker #3: As Petri mentioned, the cost-income ratio of our client AUM was 49%, actually slightly down quarter on quarter. Our income was up in Q2, but increased growth initiatives in the capital-light business meant that costs in this area increased as well.

Speaker #3: This is in line with our business plan, as you know. It's worth noting that the overall cost control remains good. Our Group's total cost-income ratio continued to improve, and we're well in line with our overall annual cost growth target of around 1% until 2028.

Matti Ahokas: It's worth noting that the overall cost control remains good. Our cost group total cost-income ratio continued to improve, and we're well in line with our overall annual cost growth target of around 1% until 2028. The net finance result was strong across the board in Q2, and I'll talk a bit more about this later on. The result related to risk policies at EUR 5.1 million in Q1, was a significant improvement compared to last year. As you know, one of our key financial targets is to grow the capital-light profit before taxes by more than 10% annually by 2028, compared to 2024. Looking at the Q2, the reported profit before tax was EUR 27.1 million or 32% growth versus Q2 2025. Although the comparison number in Q2 2025 was maybe a bit low, we are at the run rate above our long-term target growth.

Speaker #3: The net finance result was strong across the board in Q2, and I'll talk a bit more about this later on. The result related to risk policies at €5.1 million in Q1 was a significant improvement compared to last year.

Speaker #3: As you know, one of our key financial targets is to grow the capital-light profit before taxes by more than 10% annually by 2028, compared to 2024.

Speaker #3: Looking at the second quarter, the reported profit before tax was €27.1 million.

Speaker #1: Or 32% growth versus Q2 25 , although the comparison number in Q2 25 was maybe a bit low . Where are at the run rate above our long term target growth Looking at the segments asset and wealth management , profit grew by 19% year on year , driven by a 20% growth in the fee result .

Matti Ahokas: Looking at the segments, Asset & Wealth Management profit grew by 19% year-on-year, driven by a 20% growth in the fee result. The corporate segment saw a significant profitability jump as the result related to risk policies increased due to higher CSM release. In addition, the AUM increased by 18%. The retail segment saw the largest increase in fee result or 32%. The fee result was positively impacted by the very strong AUM development in the quarter. Actually, the AUM was up by some EUR 400 million compared to Q1. Let's take a closer look at the group net finance result, which came in at EUR 55 million. As you all know, Q2 was a positive quarter in the financial markets, and this is also reflected in our client AUM. The with-profit investment return in the quarter at 2.5 was above the expected level.

Speaker #1: The corporate segment saw a significant profitability jump as a result of risk policies increased due to higher CSM release. In addition, the AUM increased by 18%.

Speaker #1: The retail segment saw the largest increase in fee result, at 32%. The fee result was positively impacted by the very strong AUM development in the quarter.

Speaker #1: Actually, the AUM was up by some €400 million compared to Q1. And then let's take a closer look at the group net finance result, which came in at €55 million.

Speaker #1: As you all know, Q2 was a positive quarter in the financial markets. This is also reflected in our client AUM.

Speaker #1: The with-profit investment returned in the quarter at 2.5%. It was above the expected level. Fixed income credit now makes up as much as 79% of our own investment portfolio in Q2.

Matti Ahokas: Fixed income credit makes up now as much as 79% of our own investment portfolio. In Q2, the return was positively impacted by mark-to-market adjustments from lower rates and tighter spreads. The portfolio mark-to-market yield was down by 20 basis points in the quarter to 4.7%, but is significantly still above the cost of liabilities. Our equity portfolio return was 5.5% in the quarter, broadly in line with the market. We continued the portfolio de-risking in line with our strategy and now listed equities amount to only 2% of the portfolio. One specific thing in the quarter was that private equity returns were very strong in the quarter, actually at 7%, and we are seeing clearly higher capital distributions from the portfolio. In Q2, the PE capital distributions were over EUR 40 million, much higher than the level in previous quarters.

Speaker #1: The return was positively impacted by mark to market adjustments from lower rates and tighter spreads . The portfolio mark to market yield was down by 20 basis points in the 3:45 point 7% , but is significantly still above the cost of liabilities .

Speaker #1: Our equity portfolio return was 5.5% in the quarter, broadly in line with the market. We continued the portfolio de-risking in line with our strategy.

Speaker #1: And now, listed equities amount to only 2% of the portfolio. One specific thing in the quarter was that private equity returns were very strong in the quarter.

Speaker #1: Actually , at 7% , and we are seeing clearly higher capital distributions from the portfolio in Q2 . The PE capital distributions were over €40 million , much higher than the level in previous quarters .

Speaker #1: This supports the capital release in line with our plan. Our private credit portfolio has also continued a positive trend, like we've seen in previous quarters.

Matti Ahokas: This supports the capital release in line with our plan. Our private credit portfolio has also continued a positive trend like we've seen in previous quarter. The real estate portfolio return was negative, and this was mainly due to a write-down of a single lease contract. Turning then to the other part of the net finance result or discounting and cost of liabilities. As you saw, market interest rates decreased slightly in Q2, and this had a EUR -21 million discounting impact. Remember also that this item also includes the profit-sharing impact from the segregated portfolio, and the impact was unusually high in Q2 as the investment return from the segregated portfolio was unusually high here as well. As in previous quarters, it's nice to say that we continue to consistently generate capital. Organic capital generation was EUR 90 million or EUR 0.18 per share in Q2.

Speaker #1: The real estate portfolio return was negative, and this was mainly due to a write-down of a single lease contract. Turning then to the other part of the net finance result, or discounting and cost of liabilities.

Speaker #1: As you saw , market interest rates decreased slightly in Q2 . And this had a 21 million negative discounting impact Remember also that this item also includes the profit sharing impact from the segregated portfolio .

Speaker #1: And the impact was unusually high in Q2 as the investment return from the segregated portfolio was unusually high here as well As in previous quarters , it's nice to say that we continue to consistently generate capital , organic capital generation was €90 million , or $0.18 per share in Q2 This was the highest quarterly figure in the history of the group Q2 was the third quarter in the history of Mandatum , when the SCR from the from the with profit business is smaller than the capital light , SCR .

Matti Ahokas: This was the highest quarterly figure in the history of the group. Q2 was the third quarter in the history of Mandatum when the SCR from the with-profit business is smaller than the capital-light SCR. This confirms and shows our clear transformation journey towards a high ROE capital-light group. The group fully loaded solvency ratio stood at 195%. This was down from 207% in Q1, but clearly still above our target range. The decline was mainly driven by the increased SCR from significant increase in client equity AUM, and then the increase in the symmetrical adjustment factor, which was at the maximum level in Q2. Now back to you, Petri.

Speaker #1: And this confirms and shows our clear transformation journey towards a high, high-ROE, capital-light group. The group's fully loaded solvency ratio stood at 195%.

Speaker #1: This was down from 207% in Q1 , but clearly still above our target range . The decline was mainly driven by the increased SCR from significant increase in high client equity , AUM , and then the increase in the symmetrical adjustment factor , which was at the maximum level in Q2 .

Speaker #1: And now back to you , Petri . Thank you . Matti Before we conclude , today's presentation , I , I would like to briefly comment on our announced acquisition of the Swedish asset manager clients Clearance is a well , Swedish asset manager with a strong investment performance track record and a highly respected brand among a broad client base .

Petri Niemisvirta: Thank you, Matti. Before we conclude today's presentation, I would like to briefly comment on our announced acquisition of the Swedish asset manager, Cliens. Cliens is a well-established Swedish asset manager with a strong investment performance track record and a highly respected brand among a broad client base. The company managed approximately SEK 36 billion of client assets and serves around 100 institutional clients and 30 distribution partners through a team of experienced investment professionals. The transaction increased Mandatum's footprint in the Swedish asset management market and supports our Nordic expansion ambitions. Sweden is the largest asset management market in the Nordics, and the acquisition strengthens our local presence and client reach there. The acquisition also enhances our product offering through complementary actively managed equity products. One of Cliens' particular strength is its strong expertise and long track record in small and mid-cap equities.

Speaker #1: The company managed approximately SEK 36 billion of client assets and serves around 100 institutional clients and 30 distribution partners, through a team of experienced investment professionals.

Speaker #1: The transaction increased Mandatum's footprint in Sweden's asset management market and supports our Nordic expansion ambitions. Sweden is the largest asset management market in the Nordics, and the acquisition strengthens our local presence and client reach there.

Speaker #1: The acquisition also enhances our product offering through complementary, actively managed equity products. One of the client's particular strengths is its strong expertise and long track record in small and mid-cap equities. This complements Mandatum's existing strengths and broadens the range of investment solutions we can offer our clients. Also, we will look for opportunities over time to further broaden the distribution of Mandatum's own products.

Petri Niemisvirta: This complements Mandatum's existing strengths and broadens the range of investment solutions we can offer our clients. Also, we will look for opportunities over time to further broaden the distribution of Mandatum's own products. In addition, we believe that Cliens is an excellent strategy and cultural fit for Mandatum. Cliens' active investment managed approach, quality of operations, and strong client focus were important factors behind this transaction. The transaction is expected to be completed by the end of year 2026, provided that we get the necessary approvals from the regulators. The announced acquisition does not change our financial outlook for 2026 or our shareholder payout target. This transaction is a very good example of how we are executing our strategy in practice. At our capital markets day last year, we highlighted the international growth in asset management and the enhancement of our product offering as two key strategic priorities.

Speaker #1: In addition , we believe that clearance is an excellent strategy and cultural fit for Mandatum clients . Active investment managed approach , quality of operations , and strong client focus were important factors behind this transaction The transaction is expected to be completed by the end of year 2026 , provided that we get the necessary approvals from the regulators to announce .

Speaker #1: The acquisition does not change our financial outlook for 2026 or our shareholder payout target. This transaction is a very good example of how we are executing our strategy in practice. At our Capital Markets Day last year, we highlighted international growth in asset management and the enhancement of our product offering as two key strategic priorities for the acquisition of clients.

Petri Niemisvirta: The acquisition of Cliens supports both of these objectives and is a natural next step in this journey. Overall, Q2 confirms that our business is developing well and that we continue to execute successfully on our strategy. We enter the H2 of the year from a very good position and continue to work towards our vision of becoming the fastest-growing asset and wealth manager in the Nordics. With that, I will hand back to Lotta.

Speaker #1: Supports both of these objectives and is a natural next step in this journey. Overall, the second quarter confirms that our business is developing well and that we continue to execute successfully on our strategy. We entered the second half of the year from a very good position, and continue to work towards our vision of becoming the fastest growing asset and wealth manager in the Nordics. With that, I will hand back to Lotta.

Speaker #2: Thank you, Petra. We will now move on to the Q&A session. Joining Petra and Matti, we also have others available to answer your questions, particularly regarding the announced acquisition of clients and our asset management business in general as well. Please dial in or submit your questions via the chat.

Lotta Borgström: Thank you, Petri. We will now move on to the Q&A session. Joining Petri and Matti, we also have Janne Sarvikivi available to answer questions, particularly regarding the announced acquisition of Cliens and our asset management business in general as well. Please dial in or submit your questions via the chat.

Speaker #3: If you wish to ask a question, please dial the pound key on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial the pound key on your telephone keypad.

Operator 2: If you wish to ask a question, please dial #5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial #6 on your telephone keypad. The next question comes from Vash Gosalia from Goldman Sachs. Please go ahead.

Operator: If you wish to ask a question, please dial #5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial #6 on your telephone keypad. The next question comes from Vash Gosalia from Goldman Sachs. Please go ahead.

Speaker #3: The next question comes from Vash Gisela from Goldman Sachs. Please go ahead.

Vash Gosalia: Hi, good morning, and thank you for the opportunity. I have two questions, please. The first one on Cliens and the acquisition there. Could you give us a little bit more color on how much it would add to your EPS? I roughly calculate it is like EUR 9 million of bottom line. Do you see any upfront synergies from this acquisition? The other point I was quite curious on getting your inputs on is the fee margin in Cliens appears to be around 60 basis points, as opposed to your around 1.12 percentage points. Could you just give us some sense of how does your fee margin then develop, or do you basically see upside to the 60 basis points? That was the first part.

Speaker #4: Hi. Good morning, and thank you for the opportunity. I have two questions, please. The first one is on clients and the acquisition there.

Speaker #4: So could you give us a little bit more color on how much it would add to your EPS ? So I roughly calculate it's like €9 million of bottom line , but then do you see any upfront upfront synergies from this acquisition And also the other point , I was quite curious on getting your inputs on is the free margin .

Speaker #4: When client fees appear to be around 60 basis points as opposed to your approximately 1.12 percentage points, could you just give us some sense of how your fee margin then develops?

Speaker #4: Or do you basically see upside to the 60 basis points ? So that was the first part . The second question just on Europe , could you give us a sense of what's your near-term ambition over there ?

Vash Gosalia: The second question, just on Europe, could you give us a sense of what is your near-term ambition over there and any other countries outside of Italy that you are looking to expand into? Thank you.

Speaker #4: And any other countries outside of Italy that you're looking to expand into? Thank you.

Speaker #5: Yeah . Hi , it's Marty here . I'll take some of the questions on the on the on the on the financials of , of clients .

Matti Ahokas: Yeah. Hi, Vash. It is Matti here. I will take some of the questions on the financials of Cliens. Altogether, I think your numbers sound quite realistic on the financial impact. You should, however, remember that there is probably going to be some amount of purchase price adjustments regarding that. That might be a couple of millions, but I think the ballpark is correct. In terms of the margins, the margins are actually pretty close to what we are reporting at the moment. Of course, it is a kind of definition question. How do you look at the kind of distribution costs? Are they a reduction of the margin or are they actually a cost? I think that is probably the explanation, but the way we look at it, the margin should be fairly similar to what we are seeing at the moment on that side.

Speaker #5: Altogether , I think your , your numbers sound quite , quite realistic . On the financial impact you should however remember that there's probably going to be some amount of purchase price adjustments regarding that .

Speaker #5: So that might be a couple of millions . But I think the ballpark is , is correct . And in terms of the margins , the margins are actually pretty close to what we are reporting at the moment .

Speaker #5: Of course , it's a kind of definition question . How do you look at the kind of distribution costs ? Are they a reduction of the margin , or are they actually a cost ?

Speaker #5: So I think that's probably the explanation . But the way we look at it , the margins should be fairly similar to what we're seeing at the moment on , on , on that side

Speaker #6: Thank you . Asked about the synergies , this is not an acquisition that we've made targeting cost synergies in the first instance . So that's not going to be a main , main concern for us .

Janne Sarvikivi: I think, Vash, you asked about the synergies. This is not an acquisition that we have made targeting cost synergies in the first instance, so that is not going to be a main concern for us. We are looking for sales synergies, top-line synergies, and ways to cooperate, but cost synergies are not a central part of the calculation here. I think you had a question about Europe as well and our ambitions there. We intend to grow our business there in the similar fashion that we have done so far, taking it one step at a time and looking at the opportunities as we go along. Petri already mentioned in his opening pitch about the first clients we have now had from Italy and so forth.

Speaker #6: We're looking for sales synergies, top-line synergies, and ways to cooperate. But cost synergies are not a central part of the calculation here. And then I think you had a question about Europe as well.

Speaker #6: And our our ambitions there . We intend to grow our business there in in the similar fashion that we've done so far , taking it one step at a time and looking at the opportunity as opportunities as we go along .

Speaker #6: Battery already mentioned in his opening pitch about the the first clients we've . We've now had from Italy and so forth . So it's , it's , it's a slow progression and , but it will lead to the , to the end result that we are after , which means growing our business .

Janne Sarvikivi: It is a slow progression, but it will lead to the end result that we are after, which means growing our business there in a fashion that is favorable for the shareholders.

Speaker #6: There, in a fashion that's favorable for the shareholders.

Speaker #4: On Europe — could I just actually get a little bit more color on that? What is your right to win, or your USP, when you're competing in the European market?

Vash Gosalia: On Europe, could I just actually get a little more color on, so what is your right to win or your USP when you are competing in the European market? Presumably there you do not have the same sort of heritage or history that you have in Finland. So how do you then create that proposal or proposition for clients and compete with larger international asset managers?

Speaker #4: Because presumably there, you do not have the same sort of heritage or history that you have in Finland. So how do you then sort of create that proposal or proposition for clients and compete with larger international asset managers?

Speaker #1: Better here . So , so you are right with that . So basically , our brand recognition is extremely high in Finland and somewhat also an increasing after this acquisition .

Petri Niemisvirta: Petri here. You are right with that. Basically, our brand recognition is extremely high in Finland, and somewhat also increasing after this acquisition, of course, also in Sweden. But when it comes to Central Europe, it is not the brand recognition which is leading our business and supporting our business. I would say that it is a great expertise, long-term track, long-term team, which has been on place. So once we are competing with large, really big players and local players in Central Europe, it is just the performance and the track, and the return what we can offer and stability on our businesses and teams. That is what have already turned to business in those countries. So, it is clear thing that we have to be better than others in many ways, in order to open the doors in the first place.

Speaker #1: Of course , also in Sweden , but when we when it comes to Central Europe , it's not the brand recognition , which is leading our business and supporting our business .

Speaker #1: I would say that it's a great expertise long term track , long term team , which has been in place . So once we are competing with a large of really big players and local players , players in Central Europe or it just the performance and the track and the return , what we we can offer and and capability and our businesses and teams and that that's what have already turned to to business in those countries .

Speaker #1: So, it's clear that we have to be better than others in many ways in order to open the doors in the first place.

Vash Gosalia: Um-

Speaker #6: USB is a product excellence there . I mean , it's , it's all about having a product that stands out , that has the track record basically just described .

Janne Sarvikivi: Our USP is really product excellence there. It is all about having a product that stands out, that has the track record Petri just described, and also, of course, then the fact that we have the right people opening up the right doors there. So our sales force needs to be very competent, which of course they are. So it is a combination of product excellence and then having the right connections, but it is not brand recognition, as you correctly pointed out.

Speaker #6: And also , of course , then the fact that we have the right people opening up the right doors there . So our sales force needs to be needs to be very competent , which of course they are .

Speaker #6: So it's a , it's a combination of product excellence . And then , then having the right connections , but it's not brand recognition as you correctly pointed out .

Speaker #4: Got it. That's very helpful. Thank you so much.

Vash Gosalia: Got it. That is very helpful. Thank you so much.

Speaker #3: The next question comes from Michelle Ballatore from KBW. Please go ahead.

Operator 2: The next question comes from Michele Ballatore from KBW. Please go ahead.

Operator: The next question comes from Michele Ballatore from KBW. Please go ahead.

Speaker #7: Yes . Thank you for taking my question . So the first question is about the impact on the solvency from the acquisition of clients in Sweden .

Michele Ballatore: Yes, thank you for taking my question. The first question is about the impact on the solvency from the acquisition of Cliens in Sweden. My second question is how should we look about the dividend expectation? Because I believe, current expectation sees dividends, let us say, be also part of your excess capital. So, the EUR 64 million will go out from your own fund. If you help us understand how to frame all these moving parts ahead of the completion of this acquisition. My second question is about the distribution capabilities. I think we have discussed this, that any M&A opportunity will primarily target distribution even outside Finland. So what kind of attractive distribution capabilities you saw in this acquisition in this asset manager? The third question, which is more curiosity. I am Italian, and I am very surprised you acquired Cliens in Italy.

Speaker #7: I mean , of course My second question is , how should we look about the dividend expectation ? Because I believe I mean , current expectation is dividend , let's say , be also part of your excess capital .

Speaker #7: Excess capital . So I mean , the 64 million will go out from your own fund . So if you help us understand how to frame all this moving parts ahead of this , the completion of this acquisition and , and then my , my second question is about the distribution capabilities .

Speaker #7: I think we have discussed this , that , you know , any M&A opportunity will primarily target distribution , even outside Finland . So what kind of distribution , attractive distribution capabilities we can .

Speaker #7: You saw in this in this acquisition , in this asset manager . And then the third question , which is , you know , more curiosity , you know , as I'm Italian and I'm very surprised you acquire clients in Italy .

Speaker #7: I mean , how did this happen in terms of the , the , the , you know , the acquisition and what kind of client ?

Michele Ballatore: How did this happen in terms of the acquisition, and what kind of client? I do not know if you can mention the name, but what kind of client you were able to acquire in Italy? Thank you.

Speaker #7: I don't know if you can mention the name, but what kind of client you were able to acquire in Italy?

Speaker #7: Thank you

Speaker #5: Yeah . Hi , Miguel . It's it's Marty here . The solvency impact from from the deal . Obviously , as we've said , it's €64 million .

Matti Ahokas: Yeah. Hi, Michele. It's Matti here. The solvency impact from the deal, obviously, as we've said, it's EUR 64 million, and typically asset manager, the balance sheet is very small. The company has no debt, and that means that the real impact comes from the intangible assets and the deduction from own funds. I think it's probably in the magnitude of a roughly EUR 50 million impact altogether. If you put it in the model, it would mean somewhere between 5 and maybe 7 percentage points on the solvency ratio. So, quite manageable and altogether for that side. In terms of the dividend payout, as said, this will have no impact. We have sufficient liquidity in our parent company to finance this when the deal is closed. This is not an issue at all. We have a lot of liquidity, and we have very little debt as well.

Speaker #5: And typically asset manager , the balance sheet is very small . The company has no no no debt . And that means that the the real impact comes from the from the intangible assets and the deduction from own funds .

Speaker #5: And I think it's probably in the magnitude of roughly €50 million impact altogether . And if you put it in the model , it would mean , you know , somewhere between five and maybe seven percentage points on the solvency ratio .

Speaker #5: So quite manageable . And all together for for that side , in terms of the , of the dividend payout , as said , this will have no impact .

Speaker #5: We have sufficient liquidity in our parent company to , to , to finance this . When the deal is closed . So this is not an issue at all .

Speaker #5: We we are we have a lot of liquidity and we have very little debt as well . So that is not an issue issue for us at all .

Matti Ahokas: That is not an issue for us at all. So no impact for that, and we have the sufficient funds ready in cash and marketable securities already.

Speaker #5: So, no impact for that. And we have the sufficient funds ready — ready in cash and marketable securities already.

Speaker #6: Then it's here . Hi . You had a question about about the distribution and what this brings to to the distribution of , of Mandatum products and , and otherwise .

Janne Sarvikivi: Then it's Janne here. Hi. You had a question about the distribution and what this brings to the distribution of Mandatum's products and otherwise. I think it goes in both directions. First of all, of course, Cliens gained a very good distribution channel. They have a Swedish business. They are very strong in Sweden, but they have limited or no client exposure outside of Sweden. So we are able then to give them a path to Finland, to the rest of the Nordics, and to Europe at some stage when we deepen our relationship and start distributing our products through our channels. In the other direction, of course, we have a very good client base and very good client relationships in Sweden as it is. But of course, Cliens has been in the market for even a longer time.

Speaker #6: I think it goes in both directions . First of all , of course , clients gains a very good distribution channel . They have a Swedish business .

Speaker #6: They are very strong in Sweden , but they have limited or no client exposure outside of Sweden . So so we are able then to , to give them a , a path to Finland , to the rest of the Nordics and to Europe at some stage when we when we deepen our relationship and start distributing our products through our channels and then in the other direction , of course , we have a very good client base and very good client relationships in Sweden as it is .

Speaker #6: But of course, clients have been in the market for even a longer time. They have a bit of a different angle, different product palette.

Janne Sarvikivi: They have a bit of a different angle, different product palette. So they can now, of course, also then help us through opening doors, making sure that our products get the shelf life that they need to their customers, and that will help us to distribute our products.

Speaker #6: So they can now , of course , also then help us through opening doors , making sure that our products get to shelf life , that they need to , to their customers and , and that that will help us to distribute our products .

Speaker #6: Are we see

Michele Ballatore: How is this distribution made? Sorry.

Speaker #7: Distribution made , sorry .

Speaker #6: How is distribution made? Yeah.

Janne Sarvikivi: How is distribution made?

Michele Ballatore: Yes.

Speaker #8: Yeah .

Speaker #6: Well , both directly and through distribution platforms . If you if you talk about clients , how they distribute their products .

Janne Sarvikivi: Well, both directly and through distribution platforms, if you talk about clients, how they distribute their products.

Speaker #9: Thanks .

Michele Ballatore: Thanks.

Speaker #6: And then you had a question about Italy and the , the clients there . Of course , I can't comment on the name of the , or the type of the or clients that we have gained there .

Janne Sarvikivi: Then you had a question about Italy and the clients there. Of course, I cannot comment on the name or the type of the clients or clients that we have gained there. But the way we do it is basically the same way we do it in all the countries, through our own excellent salespeople who have the right types of contacts. Then, of course, we also use partners in some of the markets to help us distribute these products. This is the way we work, and that is also the way we have succeeded in Italy now in the last quarter.

Speaker #6: But the way we do it is basically the same way we do it in all the countries, through our own excellent salespeople who have the right types of contacts.

Speaker #6: And then , of course , we also use partners in some of the markets to help us distribute these products . And this is the way we we work .

Speaker #6: And that's also the way we've succeeded in Italy, now in the last quarter.

Speaker #1: Yeah . And if I may comment . So , so not not customer name or client name , but it's , it's clearly what we are doing outside of Finland , it's only institutional business .

Petri Niemisvirta: Yeah. If I may comment, not customer name or client name, but it is clearly what we are doing outside of Finland. It is only institutional business. So it is an institution, of course, the customer in Italy. Like Janne said, we do have something special to offer to customers all over Europe with certain asset classes which are not that commonly known and offered in certain markets, and extremely good track record on those products. So it is a combination of uniqueness and extreme good track record. Of course, like Janne said, the right people to open the doors.

Speaker #1: So it is it's an institution . Of course , the customer in Italy and , and like Janice said , it's do something special to offer to customers all over the Europe .

Speaker #1: We did certain asset classes which are not that commonly known, and offered in certain markets, and have an extremely good track record on those products.

Speaker #1: So , so it's a combination of uniqueness and extremely good track record . And of course , the like I said , the right people to open the doors .

Speaker #7: Thank you. Thank you very much.

Michele Ballatore: Thank you. Thank you very much.

Operator 2: The next question comes from Antti Saari from OP Markets. Please go ahead.

Operator: The next question comes from Antti Saari from OP Markets. Please go ahead.

Speaker #3: The next question comes from Auntie Sari from OP Markets. Please go ahead.

Speaker #10: Hello . Hi , Auntie . Here . Well , most of my questions regarding clients have been asked , but . But I have one more to go .

Antti Saari: Hello, it is Antti here. Well, most of my questions regarding clients have been asked, but I have one more to go. Looking at the figures that you gave in this release, they have been weakening in last year, even though asset management industry in general has performed quite nicely and going upwards. On the other hand, assets under management for clients were lower at the end of June than they were at the end of last year. So what is behind this? Has these clients seen weakening performance for several years, or is this just a short-term issue?

Speaker #10: So looking at the figures that you gave in this release, they have been weakening in the last year. Even though, the asset management industry in general has performed quite nicely and is going upwards.

Speaker #10: On the other hand, assets under management for clients were lower at the end of June than they were at the end of last year.

Speaker #10: So , so what's behind this ? And has this clients seen weakening performance for for several years ? Or is this just a short term issue ?

Speaker #6: Thanks , for the question , Yan . Here . Yeah , you're correct in pointing out that the AUM has declined slightly from year end .

Janne Sarvikivi: Thanks, Antti, for the question. Janne here. You are correct in pointing out that the AUM has declined slightly from year-end and that figures have been slightly weakening. The main factor behind this is, of course, the phenomenon we have seen in the entire Nordic market regarding small and mid-cap companies and the performance of those companies relative to the rest of the market. It has been a tough market to be in for the past couple of years, and it has been particularly tough in Sweden. Despite this, I think Cliens has done a very good job in retaining clients and making sure that their performance is as good as possible.

Speaker #6: And and that figures have been slightly weakening . The main factor behind this is , of course , the phenomenon we've seen in the entire Nordic market regarding small and mid-cap companies and the performance of those companies , relative then to , to the rest of the market .

Speaker #6: It's been a tough market to be in for the past couple of years , and it's been maybe particularly tough in Sweden . And , and despite this , I think I think clients has done a very good job in retaining clients and making sure that their performance is as good as possible .

Speaker #6: And of course , we think that that entire market segment of small and mid-cap companies is something where we can add value to customers because it requires research capabilities , it requires analytical knowledge , it requires a very high level of of professionalism from the from the PMS and the analysts .

Janne Sarvikivi: Of course, we think that that entire market segment of small and mid-cap companies is something where we can add value to customers because it requires research capabilities, it requires analytical knowledge, it requires a very high level of professionalism from the PMs and the analysts. We think that Cliens has all of these, and it is a market segment and sector that we think will come back. We strongly think that when it does, and even in the face of some headwinds, Cliens can benefit from this.

Speaker #6: And we think that clients has all of these . And it , it's , it's a market segment and sector that we think will come back and we , we strongly think that when it does and even in the face of some headwinds , clients can benefit from this

Speaker #10: Okay . That's that's clear . Then one , a bit technical question for for Matti , I saw that your solvency requirement rose fairly clearly in in Q two compared to Q1 .

Antti Saari: Okay. That is clear. One bit technical question for Matti. I saw that your solvency requirement rose fairly clearly in Q2 compared to Q1. In the report there was mentioned this symmetric assumption of equity holdings. Was there also something else that impacted your solvency requirement?

Speaker #10: And in the report, there was mention of this symmetric assumption of equity holdings. But was there also something else that impacted your solvency requirement?

Speaker #5: Yeah . Hi . Hi . Yeah . That's absolutely correct . That it actually came down quite a lot . But then think about it , that our assets under management and mainly on the equity side , obviously in the in the client AUM increased by 1.3 billion during one quarter .

Matti Ahokas: Yeah. Hi, Antti. That is absolutely correct that it actually came down quite a lot. Think about it that our assets under management, and mainly on the equity side, obviously in the client AUM, increased by EUR 1.3 billion during one quarter. This meant that the solvency capital requirement came up and the corresponding increase, which you normally see in the own funds, was lower than that. This will even out in the coming quarters altogether. Of course, the main impact was that now the symmetrical adjustment factor is at the maximum at 10 percentage points because the markets have been so strong. That, of course, hits it instantly. Over time, of course, we hope to see as good AUM growth, because that is probably the single most important driver for our profitability.

Speaker #5: So this meant that the Solvency Capital Requirement came up, and the corresponding increase, which you normally see in the own funds, was lower than that.

Speaker #5: So this will even out in the in the coming quarters altogether . But of course , the main impact was that the now , the symmetrical adjustment factor is at the maximum at ten percentage points , because the markets have been so strong , so that , of course hits it in instantly .

Speaker #5: But over time , this . Of course , we hope to see as good AUM growth because that's probably the most single most important driver for our profitability .

Speaker #5: But it’s also kind of—it will even out the impact altogether, because then the own funds increase will compensate for that as well.

Matti Ahokas: But it will even out the impact altogether because then the own funds increase will compensate for that as well. But once you see a very high increase in the assets under management, it will kind of temporary burden the solvency margin as well, even though it's in the capital-light business.

Speaker #5: But once you see a very high increase in the assets under management, it will kind of temporarily burden the solvency margin as well, even though it's in the capital business.

Speaker #10: I see. Okay, that's all from my side. Thanks.

Antti Saari: I see. Okay. That's all from my side. Thanks.

Speaker #3: The next question comes from Jaco Tyrvainen from SEB. Please go ahead.

Operator 2: The next question comes from Jaakko Tyrväinen from SEB. Please go ahead.

Operator: The next question comes from Jaakko Tyrväinen from SEB. Please go ahead.

Speaker #11: Yeah . Good morning Seb . The client questions have mostly been discussed , but if I may , I would like to ask about the incentives for the for the key employees is there is the 22% stake enough strong in your view for for the key employees and to talk a bit more how you are planning to retain the key people in that business

Jaakko Tyrväinen: Good morning. Jaakko from SEB. The client questions have most of been discussed, but if I may, I would like to ask about the incentives for the key employees, if there is the 22% stake enough strong in your view for the key employees. Could you talk a bit more how you are planning to retain the key people in that business?

Speaker #6: Yeah , thanks . Yeah . We think that it's a very strong vote of confidence that that the key employees and actually most of the employees at clients wanted to to stay along for the ride that we have in front of us .

Janne Sarvikivi: Yeah, thanks, Jaakko. We think that it is a very strong vote of confidence that the key employees and actually most of the employees at Cliens wanted to stay along for the ride that we have in front of us. The incentive from their part is actually quite strong with the shareholding they have. So we absolutely believe that the kind of ownership they have is enough to align their interest with us and retain the key employees. That was one of our main concerns and main points during the discussions that we absolutely want to retain the key employees, and we think that we have found a structure that very much does so.

Speaker #6: And , and the incentive for from their part is , is actually quite strong with the shareholding they have . So we absolutely believe that , that the kind of ownership they have is , is enough to align their interests with , with us and retain the key employees .

Speaker #6: That was one of our main concerns, and main points during the discussions, that we absolutely want to retain the key employees, and we think that we found a structure that very much does so.

Jaakko Tyrväinen: Thank you. Then on the Q1 report and performance, I know that you are talking about the net numbers in terms of flow, but could you elaborate? Did you see some material outflow during the quarter? Just trying to understand the underlying new business trends there.

Speaker #11: Thank you . And then the on the Q1 report and performance , I know that you are you are not . You are talking about the net net numbers in terms of flows .

Speaker #11: But could you elaborate? Did you see some material outflows during the quarter? I'm just trying to understand the underlying new business trends there.

Speaker #1: Yes . Petter here about the net flow and outflows and inflows . I would say that that no one should be worried about our sales capability , our sales is going extremely well .

Petri Niemisvirta: Yes. Petri here. About the net flow and outflows and inflows, I would say that no one should be worried about our sales capability. Our sales is going extremely well and our products are in order, and there is no softening on that side. The fact, of course, is that we have now invested quite a lot of new salespeople lately, and we have not seen or got yet, let us say, normal level of sales from them. At the same time, our assets under management has increased a lot, which means that even our customers are extremely happy with us. We have very high NPS. We have a normal industry average outflow yearly basis. Our customers need money back reason or another, even though they are happy with us. That means that the bigger assets under management also creates bigger net outflow no matter what in certain ways.

Speaker #1: And , and our products are in in order and , and , and there is no softening on that side . The fact , of course , is that we have now invested quite a lot of new salespeople lately .

Speaker #1: And we haven't seen or got yet , let's say normal level of sales from them at the same time , same time , our assets under management are it has increased a lot , which means that even even our customers are extremely happy with us .

Speaker #1: We have a very high NPS. We have a normal industry average outflow on a yearly basis. Our customers need money back for one reason or another, even though they are happy with us.

Speaker #1: And that means that the bigger assets under management also create bigger net outflows, no matter what, in a certain way. So you have to sell even more than previously.

Petri Niemisvirta: So you have to sell even more than previously. So that is one. There is one little bit bigger outflow number in our customer side, which has nothing to do with the customer's happiness with that. It was customers' other reasoning and structuring. So I would say that it was a little bit more outflow side than sales inflow side which affected that the number was not that high when it comes to net flow during the Q2.

Speaker #1: So that's one . There is one a little bit bigger , bigger outflow number in in in customer side , which is nothing to do with the customers happiness .

Speaker #1: With us . It was customers , customers other , other reasoning and , and structuring . So , so I would say that it was a little bit more outflow side than , than sales inflow side , which affected that the number wasn't that high when it comes to net flow during the Q2

Speaker #11: Very good . Thank you . Continuing on that one , it quite nice amount of of new product commitment during the first half Should we take think that the sales .

Jaakko Tyrväinen: Very good. Thank you. Continuing on that one, you have reported quite a nice amount of new product commitments during H1. Should we think that the good sales in commitment is somehow away from the kind of, so to say, ordinary net flows? You will get that money in later on, but should we think that the commitment sale has been done is kind of similar to the net flow sales?

Speaker #11: Good sales commitment is somehow away from the, from the kind of a, so to say, ordinary net flows. You will get that money in later on.

Speaker #11: But but is it kind of a should we kind of a Think that the commitment sales has been done . It's kind of similar to the net flow sales .

Speaker #1: Yeah . Of course , those commitments . Yeah . A little bit more details . But as as as a high level , those commitments of course , are , are not seen immediately .

Petri Niemisvirta: Yeah, of course, those commitments Janne will go a little bit more details, but as a high level, those commitments of course, are not seen immediately in our net flow. At the same time, they require resources from our sales organization. That is also the one explanation for our net flow maybe not to be the level that somebody wanted it to have because our resources and our salespeople, they concentrated a lot for commitment-based sales and not having that much time to other products because that was very important to get those commitments as much as possible before closing. That money will come once we call those commitments in. Typically, it is 2 to 3 years when everything we are planning to call in. But of course, it will show up in our net flow going forward once we call that money.

Speaker #1: Now net flow , but at the same time , they require resources from our sales organization . That's also the one one explanation for , for our net flow .

Speaker #1: Maybe not to be the level that somebody wanted , wanted to have because our resources and salespeople , they concentrated a lot for , for commitment based sales and , and not having that to other products because that was very important to get those commitments as much as possible before closing .

Speaker #1: And that money will come once we call those commitments in. Typically, it’s two to three years when we are planning to call them in.

Speaker #1: But of course, it will show up in our net flow going forward, once we call that money. So, if you want to add something to that.

Petri Niemisvirta: Janne, if you want to add something to that.

Speaker #6: Yeah , sure . Just adding to what Peter just said is , is that commitment based sales is important . Very important for us .

Janne Sarvikivi: Yeah, sure. Just adding to what Petri just said is that commitment-based sales is very important for us. It is money that typically flows into products that are very specific to our expertise. Of course, like Petri said, it takes some resources away from selling other products. That being said, I would not say that our sales personnel are capacity constrained. They have capacity to sell other stuff as well. But it just so happens that during H1, we had two particularly excellent products that were in high demand among customers, and that took some of our resources of course then as well.

Speaker #6: It's , it's money that typically flows into products that are very specific to our , our expertise . And , and of course , like Peter said , it takes some resources away from selling other products .

Speaker #6: That being said, I wouldn't say that our sales personnel are capacity constrained. They have capacity to sell other stuff as well.

Speaker #6: But , but it just so happens that during the first half of the year , we had two particularly excellent products that that were in high demand among customers .

Speaker #6: And that took some of our resources. Of course, then as well.

Speaker #11: Very good. Thank you all from me.

Jaakko Tyrväinen: Very good. Thank you. That was all from me.

Operator 2: The next question comes from Emil Immonen from DNB Carnegie. Please go ahead.

Operator: The next question comes from Emil Immonen from DNB Carnegie. Please go ahead.

Speaker #3: The next question comes from Emil Immonen from Denaby Carnegie. Please go ahead.

Speaker #12: Hi . Thanks for taking my questions . Just a couple more . I want to push a little bit on the the hiring of personnel , because when I look at the number of employees you have , it doesn't really look like it's it's increasing .

Emil Immonen: Hi. Thanks for taking my questions. Just a couple more. I want to push a little bit on the hiring of personnel, because when I look at the number of employees you have, it does not really look like it is increasing. So is there then simultaneously some cost-cutting in other places if you are hiring sales personnel, or how should we think of it?

Speaker #12: So is there then simultaneously some cost cutting in other places if you're hiring sales personnel, or how should we think of it?

Speaker #1: Yeah , yeah , you are right . It's the top number of of the all employees is not increasing . It's more or less the same than it has been in or in many quarters .

Petri Niemisvirta: Yeah. You are right. The top number of the all employees is not increasing. It is more or less the same than it has been in many quarters, but it is the inside of the company. So there has been a shift from, let us say, support functions to customer service and sales. So we are here following the ratio of the number, percentage, what is the number of salespeople and customer service compared to whole number of employees, and that number is increasing. So there is less people in support functions than it used to be, and more people in sales side than it was like a year ago or half year ago. That is what has happened.

Speaker #1: But it's , it's the inside of the company is that there has been a shift from , let's say , support functions to customer service and sales .

Speaker #1: So , so we are here for long . The race of , of the number percentage , what is the number of salespeople and customer service compared to the whole whole number of employees and , and , and that , that number is increasing .

Speaker #1: So, so, so there are fewer people in support functions than there used to be, and more people on the sales side.

Speaker #1: And that than it was, like, a year ago or half a year ago. That is what has happened.

Speaker #12: Okay . Sounds sounds good . And , and that's then I assume it's mostly focused on , on increasing the institutional sales because that has if we look year on year , well , it was flat in the net flow was flat in Q2 .

Emil Immonen: Okay. Sounds good. That's then I assume it's mostly focused on increasing the institutional sales because that has, if we look year-on-year, well, the net flow was flat in Q2, and it's not really accelerating right now, at least. So you're looking to accelerate that in at least the coming years, but hopefully coming quarters as well.

Speaker #12: And it's not really accelerating right now, at least. So you're looking to accelerate that in the coming years, at least.

Speaker #12: But hopefully in the coming quarters as well.

Speaker #1: Yeah , the the areas we have had added people is , is international institutional sales . We , we have also changes in our institutional sales in Finland and also private wealth management in Finland .

Petri Niemisvirta: Yeah. The areas we have added people is international institutional sales. We have also changes in our institutional sales in Finland, and also private wealth management in Finland. We have new hires as well as in our corporate business area. So quite a wide increase in our sales forces.

Speaker #1: We have a new hires and as well as in our corporate business area . So so quite , quite a wide increase in our sales forces

Speaker #12: Okay . Understood . And then maybe one more question on , on the acquisition of clients , as you described . It's it's not any cost synergies you're going for .

Emil Immonen: Okay, understood. Then maybe one more question on the acquisition of Cliens. As you described, it's not any cost synergies you're going for, it's more revenue synergies. So I want to ask, is there any overlap in your customers or is it completely synergistic?

Speaker #12: It's more revenue synergies . So I want to ask , is there any overlap in , in your customers or is it is it completely synergistic ?

Speaker #1: So there is a , let's say they are they are also say Sweden is not that big countries . Of course , there are some common customers , but it's it's what what is good news for for all of us is that there are also we are a little bit in different customer segments in certain way , even though both are in institutional customers .

Petri Niemisvirta: Sweden is not that big country. Of course, there are some common customers, but what is good news for all of us is that we are a little bit in different customer segments in certain way, even though both are institutional customers. So that creates opportunities for both parties. So we have a little bit different type of institutional customers portfolio. So Janne, if you want to add something, please.

Speaker #1: So , so that creates opportunities for both parties . So we'll , we have a little bit different type of institutional customers portfolio .

Speaker #1: So if you want to add something, please.

Speaker #6: Yeah . Following up on that is of course that our , our product portfolios are exactly complementary . So we even though , of course in Sweden , like Petri said , it's the key institutional customers are typically people .

Janne Sarvikivi: Yeah. Following up on that is, of course, that our product portfolios are exactly complementary. Even though, of course, in Sweden, like Petri said, the key institutional customers are typically people we also talk to, but the products we sell to them are completely different than what Cliens have been selling. That is the overlap, but it is not a negative, it is a positive for us.

Speaker #6: We also talk to . But the products we sell to them are completely different than what clients has been selling . So so that that is the overlap , but it's not a positive .

Speaker #6: It's not a negative, it's a positive for us.

Speaker #12: Okay, that's all from me. Thank you.

Emil Immonen: Okay. That is all from me. Thank you.

Speaker #3: The next question comes from Gisela from Goldman Sachs. Please go ahead.

Operator 2: The next question comes from Vash Gosalia from Goldman Sachs. Please go ahead.

Operator: The next question comes from Vash Gosalia from Goldman Sachs. Please go ahead.

Speaker #4: Hi . I actually wanted to clarify on one of your answers from before . So you mentioned that your own funds in your capital business , your own funds , is higher than the SCR , but can you give us a sense of how much own funds does your capital light business generate on day one for per euro of SCR ?

Vash Gosalia: Hi. I actually wanted to clarify on one of your answers from before. You mentioned that your own funds, so in your capital-light business, your own funds is higher than the SCR. But can you give us a sense of how much own funds does your capital-light business generate on day one per EUR of SCR? Just trying to get a sense of the solvency ratio impact from new business. The other question was, again, just on solvency too, and the symmetrical adjustment. You mentioned that it is at the maximum level, which is 10%. Does that mean if the markets continue to rally from here or if they continue to perform well, the benefit to your solvency to ratio will be much higher than we have seen in the past?

Speaker #4: So just trying to get a sense of the solvency ratio impact from new business. And the other question was, again, just on Solvency II.

Speaker #4: And the symmetrical adjustment . So you mentioned that it's at the maximum level , which is 10% . Does that mean if the markets continue to rally from here or if they continue to perform well , the benefit to your solvency ratio will be much higher than we've seen in the past

Speaker #5: Yeah , it's it's Marty here . So basically how it works is that , that the , the own funds is calculated by the kind of normalized equity market return or fund return , which is clearly lower .

Matti Ahokas: Yeah. Hi, Vash, it's Matti here. Basically how it works is that the own funds is calculated by the kind of normalized equity market return or fund return, which is clearly lower what we've seen here now. That of course is kind of explaining part of the stuff. And I said 10 percentage points, it's actually 9 percentage points, the maximum. But that's where the level is now because of the strong market performance. As you know, that is the buffering in the system so that when markets come down, then the solvency impact is smaller, and when markets are very positive, it is consuming more solvency margin altogether. Sorry, I forgot your other question.

Speaker #5: What we've seen here now . So that of course is kind of kind of explaining part of the stuff . And I said ten percentage points .

Speaker #5: It's actually nine percentage points . The maximum . But that's that's where the level is now because of the stock market performance . And as you know , that is the buffering system buffering in the system .

Speaker #5: So that that when , when markets come down , then the solvency impact is smaller . And when markets are very positive , it is consuming more , more solvency margin altogether .

Speaker #5: And sorry, I forgot your other question.

Speaker #4: So the other one was just, how much of own funds does the capital business generate on day one versus the SCR? So you mentioned that your own funds on day one of writing business is higher than the SCR, but I'm just curious as to how much higher than the SCR it is?

Vash Gosalia: The other one was just how much of own funds does the capital-light business generate on day one versus the SCR? So you had mentioned that your own funds on day one of writing business is higher than the SCR, but I'm just curious as to how much higher than the SCR is it?

Speaker #5: The difference is not not significant on on day one . And it depends , of course , on the on the products that we're .

Matti Ahokas: The difference is not significant on day one, and it depends, of course, on the products that we're. As you know, in our system, our products and funds are part of our insurance wrapper. So that is-

Speaker #5: So as you know , in our , our , our system , we have a products and funds are part of our , our insurance wrapper .

Speaker #5: So , so that is , that is the main main driver driver behind it . And then of course , there is a solvency requirement because of that , but it's roughly the same or just ever so slightly above .

Matti Ahokas: That is the main driver behind it, and then, of course, there is a solvency requirement because of that. But it's roughly the same or just ever so slightly above. But remember, then if you have a very big increase like we've had now in this quarter, it kind of consumes a bit more, but it evens out in the coming quarters.

Speaker #5: But remember then if you have a very big increase , like we've had now in this quarter , it kind of consumes a bit more , but it , it evens out in the coming quarters .

Speaker #4: Got it. That's helpful. Thank you.

Vash Gosalia: Got it. That is helpful. Thank you.

Speaker #3: The next question comes from Michelle Ballatore from KBW. Please go ahead.

Operator 2: The next question comes from Michele Ballatore from KBW. Please go ahead.

Operator: The next question comes from Michele Ballatore from KBW. Please go ahead.

Speaker #7: Yes . Thanks for the follow up question . It's still about Sweden and just regarding I mean , if we look at your offering , of course , you have part of your offering is more or less less plain vanilla , like , you know , credit and things like that .

Michele Ballatore: Yes, thanks for the follow-up question. It is still about Sweden, and just regarding. If we look at your offering, of course, you have part of your offering is more, let us say, less plain vanilla, like credit and things like that, where you have a pretty strong know-how and probably quite unique know-how. So what kind of appetite you think there would be for this kind of products that are presumably higher margin in Sweden? Thank you.

Speaker #7: I mean , where you have a , you know , pretty strong knowhow probably quite unique . Know how . So what kind of appetite you think that would be for this kind of products that are presumably higher margin in , in Sweden .

Speaker #7: Thank you .

Speaker #6: So you're asking about how our products sell in Sweden. The products we are currently offering are credit and other types of debt products, or...

Janne Sarvikivi: So, you are asking about how our products sell in Sweden, the products we are currently offering, credit and other types of debt products or

Speaker #7: Also in also , in light of the acquisition of flying clients , right ?

Michele Ballatore: Yeah, also in light of the acquisition of Cliens.

Janne Sarvikivi: Right. Basically, it is a niche strategy, and we have been able to generate a lot of interest in sales in Sweden already at the moment. If we think about how we can broaden that now through the acquisition, it is of course a question of getting our foot in the door for more clients and showing our product to them. As we have been executing on a very successful niche strategy, which is based on our competence in these products, I think we are going to be very successful if we have an opportunity to gain access to clients whom already have a good experience with working with Cliens.

Speaker #6: So basically , I mean , it's a niche strategy and , and we have been able to generate a lot of interest and sales in Sweden already at the moment .

Speaker #6: And if we think about how we can broaden that now through the acquisition , it's of course , a question of , of , of getting our foot in the door for more clients and showing our products to them .

Speaker #6: And as we have been executing on a very successful, successful niche strategy, which is based on our competence in these products, I think we're going to be very successful if we have an opportunity to gain access to clients who already have a good experience with working with clients.

Speaker #9: Thank you

Michele Ballatore: Thank you.

Speaker #2: Then let's move over to the chat questions. We have several questions from Sally and Lennart, and some of these we have already answered.

Lotta Borgström: Then let us move over to the chat questions. We have several questions from Sauli Vilén at Inderes, and some of these we have already answered. The first one would be: Can you confirm that 2025 figures are purely continuous fees and do not include any notable performance fees or other one-time fees? I think Sauli is referring to Cliens here.

Speaker #2: But the first one would be: can you confirm that the 2025 figures are purely continuous fees and do not include any notable performance fees or other one-time fees?

Speaker #2: I think it's referring to clients here.

Speaker #5: Yes, we can confirm that.

Janne Sarvikivi: Yes, we can confirm that.

Speaker #2: Then . Following . Is there a put call structure for the 21.6% stake held by the management ? If there is , can you open up the details regarding this ?

Lotta Borgström: Then following: Is there a put/call structure for the 21.6% stake held by the management? If there is, can you open up the details regarding this?

Speaker #6: Yeah , we won't go into the details of the shareholder , but what I can say , of course , is that the clients , employee shareholders have made a long term commitment here to us .

Janne Sarvikivi: Yeah, we won't go into the details of the shareholder, but what I can say, of course, is that the Cliens employee shareholders have made a long-term commitment here to us, and we look forward to that partnership.

Speaker #6: And we look forward to that partnership.

Speaker #2: And then the following theme . We've already touched upon . But just to make clear , are the key fund managers , owners in clients .

Lotta Borgström: The following theme we've already touched upon, but just to make clear, are the key fund managers owners in Cliens?

Speaker #6: They are owners in clients , clients share ownership is , is very widely distributed in the company as well . But the key employees are all owners .

Janne Sarvikivi: They are owners in Cliens. Cliens' share ownership is very widely distributed in the company as well, but the key employees are all owners.

Speaker #2: How much of the AUM comes from distribution partners and how much from institutional institutions? And what is the share of the largest distribution partner?

Lotta Borgström: How much of the AUM comes from distribution partners and how much from institutions, and what is the share of the largest distribution partner?

Speaker #6: We're not going to disclose the shares of different partners from from AUM , but distribution partners are important because they are a lot of the AUM is distributed distribute , distributed through them .

Janne Sarvikivi: We are not going to disclose the shares of different partners from AUM, but distribution partners are important because a lot of the AUM is distributed through them.

Speaker #2: And the last question. How worried are you that both flagship funds are underperforming their corresponding indexes or indices over one-year and three-year periods?

Lotta Borgström: The last question: How worried are you that both flagship funds are underperforming their corresponding indexes or indices on one year and three-year periods?

Speaker #6: Well , we briefly touched upon that earlier when when we got a question about the performance . But the the short answer is , is we are not worried because we think that in particular , this market segment in particular , than the small market .

Janne Sarvikivi: Well, we briefly touched upon it earlier when we got a question about the performance. The short answer is we are not worried because we think that in particular, this market segment, in particular the small/mid-cap market, you should look at for a longer period of time than just one or three years. We all know how the market has been during the past one to three years in that particular segment. On a 10-year horizon, for example, the figures look very different.

Speaker #6: You should look at for a longer period of time than than just 1 or 3 years . And we all know how the market has been during the past one , two , three years in in that particular segment on a ten year horizon of for example , the figures look very different .

Speaker #13: And if I may add.

Petri Niemisvirta: If I may add, once we have done our DD and look at the company and its people and knowledge, we believe their way of working and how they look at the market, it is the same people who have done this long-term track, and we believe that it will come in good results going forward as well.

Speaker #1: So once we have done our DD and look at the company and its . It's a people and knowledge . We believe they are way of working and and how they look at the market and , and it's , it's the same people who have done this longer long term tracks .

Speaker #1: And we believe that it will it will come come in in a good results in going forward as well

Speaker #2: Okay. That concludes today's audiocast. If you have any further questions, please feel free to reach us at Investor Relations. Thank you for joining us, and have a great day.

Lotta Borgström: Okay. That concludes today's audio cast. If you have any further questions, please feel free to reach us at Investor Relations. Thank you for joining us, and have a great day.

Operator 2: The host has ended this call. Goodbye.

Operator: The host has ended this call. Goodbye.

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