Tarik El Mejjad: Just a couple of questions, please. First, on NII. So to come back to that again. But just to understand really the liability margin dynamics. So now we are at . You guide for the full year will be But I guess the downward trend will continue into ’25 of the liability margin before we hope to see some improvements in the back end of ’25 when you can start to cut deposit rates. Is that the way to look into it? And then obviously, volumes and asset spreads another discussion. And then secondly, on the costs. [indiscernible] I mean the waterfall chart is very useful, and we can have my view on the different moving parts. But when you talk about additional savings, can you discuss a bit more what kind of savings you would be implementing? And should we expect the kind of savings we had in the last 2, 3 years, we would exits from some geographies in the Retail and some businesses or will be more kind of work — here and there some better cost efficiency.
Tanate Phutrakul: I think on NII, I think it’s not the right assumption to say that we expect deposit margin to go below 100%. There’s a number of actions that we would take in that case in terms of promo rates to customer, in terms of core rate reductions, in terms of deposit growth, variability there. So I think from that perspective, we see the 100 basis point NII as more of a long-term levels that we’re confident we can manage at that kind of particular level. So that’s really the question on NII. And to ask your second question in terms of cost reduction, what’s contained in that 2% or €200 million. It’s not about the impact of reducing our footprint, right? It’s really about digitizing the core operations of ING. And maybe I can call out what some of the big highlights for those €200 million reduction would be.
One would be clearly a reduction of front office staff and branches, that would be one area. The second is the positive impact in terms of optimizing and automating our KYC processes. That would be the second. And then the third would be reductions in terms of our tech investments from the — of our digitization spend from the previous year. So these would be the three buckets that would drive those cost reduction more about digitizing the core of ING rather than footprint reductions.
Tarik El Mejjad: Very helpful.
Operator: Thank you. And from JPMorgan, we have Raul Sinha with our next question.
Raul Sinha: Two questions from me, one follow-up and one on capital distributions. Firstly, the follow-up, Tanate. I just come back to this because it seems to be very important. You’re indicating that the liability margin, you can maintain at 100 basis points, which you’re expecting to hit that level by the end of 2024 based on the forward curve, which implies that there will be further rate cuts in 2025. So essentially, what you’re indicating to us is that your liability margin, you can manage around 100 basis points even in 2025, even if you have rate cuts. Is that a fair conclusion?
Tanate Phutrakul: You had two questions. Do you want to ask both questions?
Raul Sinha: And the second one is just on the capital ratio on the distribution, and this is more for Steven. I mean, I’m sorry to flag this, but the capital ratio has actually increased to 14.7% from 14.5% last year despite your best efforts to get — to reiterate the target of 12.5%. So I guess the real question is, what are you actually planning around this? It appears that doing capital return every 6 months is not enough based on the trajectory you have. So are you thinking about an acceleration? Because you’re not mentioning this in your outlook for 2024. Could you even consider maybe moving to every quarter in terms of capital distribution, perhaps including some special dividends if you’re not able to buy back — enough, just to get some thoughts on where — what gives you comfort that you can actually reduce the capital target towards the capital target when actually your capital ratio is going up.
Steven van Rijswijk: Yes. Thank you very much, Raul. And thank you for calling out the fact that indeed, our capital went up compared to last year from 14.5% to 14.7%. That is correct. That also has to do, of course, with the performance. So I can’t complain. But it also means because we gradually towards — around 12.5% by end of 2025 that we will continue with looking at how to optimally do our capital distribution and we maintained the rhythm that we have that we have maintained for the past two years — will come back and the next time, therefore is during our first quarter results, in which we come back with explaining what we will do in terms of capital distributions at that point in time, including potential share buybacks.
Tanate Phutrakul: And to confirm, yes, our view is that we can maintain for the long term and interest rate margin of around 100 basis points on liabilities.
Operator: Thank you. And we’re now moving on to our next questioner, which is Benoit Petrarque from Kepler Cheuvreux.
Benoit Petrarque: So a few questions on my side. I wanted to come back on the Slide 20 on the NII outlook. So if I sum up everything, my impression is that your convergence towards the 100 bps is clearly quicker than expected in ’24. Now you will maintain that in ’25. But trying to understand why you expect now in ’24 this guidance. Obviously, you expect ECB rate to be cut quite aggressively. And it seems that you expect well, that adjustment will be more back-end loaded, i.e., competition forces will play. You might not be able to cut deposit rates as much as you might want in ’24 and the cut might more becoming in ’25, i.e., allowing you to maintain your say, liability margin — stable also in 2025. So I just wanted to kind of confirm this view.
Also on this chart, I wanted to come back on the lending margin because you assume flat lending margin — margins. And I will expect in the low interest — to see kind of more positive trends on lending margins. So just wanted to check if I missed something here. And then final, just a short question on the top line. I think you said it will be somewhat below the ’23 level at 22.6%. Can we assume something around the €22 billion just to help us to model the bank?
