Gielda Papierow Wartosciowych w Warszawie SA

WSE:GPW

Earnings Call Transcript 2020-Q3

[Pawel Wieprzowski, analyst]

Good afternoon. I'm very pleased to welcome you to the Third Quarter Conference Call with Warsaw Stock Exchange. Today, the company is represented by Marek Dietl, the CEO of the company; Izabela Olszewska, member of the Management Board; Piotr Borowski, also a member of the Management board; and, Piotr Listwon; Vice President of the Management Board of TGE Group. Gentlemen, the floor is yours.

[Marek Dietl, executive]

Thank you very much, Pawel. So let me begin the presentation. So first of all, I'd like to welcome you to our presentation, and we are very glad that you are interested in our third quarter results. Hopefully, you have the presentation in front of you, and let us move quickly to the Page 3, where we summarize the financial and development milestones.

So on the left-hand side, we have business results after 9 months of 2020. So we have healthy revenue, top line growth, 12%. EBITDA is also up by 5%. Net profit was slightly down due to some one-off, and this will be explained later in the call. We had a -- business-wise, we have a very good momentum at IPOs, altogether, 13, 1 and 3, with total IPOs in European Union of 33. So we maintain 1/3 of the IPO market in Europe in a number of IPOs. Trading volumes are 1/3 up, 33% up. Also, revenues from market data are very good, up almost 6%. And we also introduced new products to our agriculture market or agriculture venue. So this agricultural market is developing pretty nicely.

On the right-hand side, you have -- with the dark blue to, you have other elements which create shareholder value. So let's say, long term, our other strategic initiatives. And in Q3, we are continuing to implement our strategy set up in 2018. So in the primary markets, we said we were busy with 2 initiatives is GPW Ventures. It's a -- we established corporate ventures. It is a pre-IPO fund together with agricultural support agency, which will be focused on agri tech and other agri businesses in the -- quite agnostic when it comes to the stage of development, but ultimately, at least part of the company should be IPOed.

GPW Group is our education program, and we had the second edition of it. Again, maximum number of participants subscribed to this training. So the initiative itself is cash flow positive. And we are very glad about that people are so interested in education, having in mind the limitations, it will be mainly done online, with focus on agriculture products.

In the spring, we'll start another edition. So we have published per year from 2020, '21. In trading, we introduced a new product, new derivatives. It's also part of our strategy. This was a single stock futures. And we had the second phase of private markets, our block chain initiative, the first crowdfunding platform. So we constituted crowdfunding platform. Now we are partners in Raisemana. It's a platform for issuing tokens for revenue shares. And we received financing from National Center for Research and Development for building of the secondary market trading platform for tokens. Next year, in about 10 months, this platform will be ready, and we will be hosting this block chain-based token sharing and trading platform for smart contract in token.

In the data space, our [indiscernible] GPW Data [indiscernible] the Phase 1 is closed. We move to the Phase 2. So I think goes as we initially planned. And we also integrated our capital group for GPW. So our financial instruments venue, our BMR, our index company, GPW Benchmark, BondSpot, our bond trading platform and TGE, our commodities exchange and Phase 1 data was integrated, and we expect -- and that the licensing strategy was unified. So we expect major synergies from this joint sales on the revenue -- synergies on the revenue side, obviously.

Technology, our trading, we developed our core trading system and Phase 2 was closed, sometime. So we are glad that we progressed, the aspects of the system is already done. And GPW Tech, our arm which supports the commercialization of IT product developed in our capital group. And we're happy that now that first clients are testing our tools, and GPW Tech will be -- will transfer to the GPW Tech, 3 products altogether by the end of this year, and the company will be responsible for commercialization of them.

We also engage in some brand building events, ESG, CSR type of events. So we hosted the Three Seas Conference of CEOs of Three Seas Exchanges, South, Central and Eastern Europe. And it was Polish President, spent -- was the participant for over 2 hours. So we're very glad that he supports us in this process of cooperation within the Three Seas region. And we had a IPO recently. And the profit from the first day of trading of Allegro, we decided to offer as charity for coping COVID-19 pandemia and we received very great feedback from different stakeholders, and we believe that was really great investment in our brand, and also, as a beneficiary of the COVID-19 pandemia, I am really convinced that we should share the fruits of this success.

So let me know leave the floor to Izabela Olszewska who will guide you through our business performance.

[Izabela Olszewska, executive]

Thank you, Marek. So good afternoon to everyone.

So based on the last few slides, I would like to expand the core business overview of the first quarter, and we are on the Page #4. And this is the international comparison of exchange volume and turnover velocity indicator.

So the percentage growth of EOB turnover have placed the Warsaw Stock Exchange in [indiscernible] of the European stock exchanges. And following the strong increase of trading volumes in the end of Q1 and Q2, which was related to the outbreak of the pandemic and the high volatility occurred on the market, so currently, the volumes on many exchanges tend to decline, which is not the case of the Warsaw Stock Exchange.

And what makes us different from other exchanges? So I would like, first of all, to mention the very high activity of retail clients. And the retail clients started their inflow in March and still continue. And it is caused by a couple of reasons, but the most important is the record low interest rates in Poland. So it means that keeping the savings on the bank deposits. Currently, this means the real loss, minus -- around minus 3% per year. So PLN 70 billion flowed out of bank accounts. And some of this money that, they are on exchange because the people discovered that there are very good companies, especially those COVID winners, and they can earn money and multiply their savings on the exchange.

The other reason is growing employee capital schemes. This is the governmental program which was implemented in 2019. And the goal of this program is to build the long-term savings of Polish citizens. And this program is mandatory for Polish companies, but voluntary for employees. However, it covered PLN 2 billion in assets. And we estimate that around 40% is -- of this asset is invested on equity markets. So increasing volumes also -- they are also reflected in turnover velocity indicators. So I already described the reasons of growing trading volumes. But in the denominator of this turnover, we have the market capitalization. And in Q3, the market cap decreased a little bit. So it means the whole turnover that has noted the positive -- very positive results. So turnover velocity increased from 33% up to 5 -- 52.5%.

So now let's go to Page #5, and this is about the equity market. And in Q2, we had lower volumes, but comparing to -- in Q3, we had the lower volumes comparing to Q2. But year-on-year, it was a growth -- on the security market, 20 -- almost 29%. Of course, you should realize that in Q2, we had 2 holiday months. So there are always a month with lower trading volumes. But what is expected on the equity market? So we expect this further high activity of individual investors. So these investors, they are with us because they want to have the good products and good companies listed on our platform. And here, we do believe in our deal pipeline, because we know now that more than 20 corporates, they are in the process of preparation for listing. So we expect very soon the new debut of Canal+ Company from the media sector. And then there are a couple of other big companies like one Huuuge Games which is registered in the States from gaming sector, and also some others from gaming, e-commerce sectors, and also new technologies, biotech sectors.

Also, we expect a very active SPO market. So in 2020, we have already 61 offers. And the companies, they collected around PLN 3 billion in SPO. So the end of the year is normally also the time when there's inflow to individual pension accounts, which is connected with the inbuilt tech incentive in this product. And also, Allegro, which is the company currently in a couple of international indices and benchmarks so like FTSE stock MSCI, so I think that also got the attention of more foreign clients for Polish market.

So on the NewConnect market of our SME platform, as we also had the tremendous growth of volumes. And this was connected with the interest of the clients in trading of COVID winners. So we had a couple of very good companies listed in NewConnect. And what's -- is worth mentioning that, first time ever, one of our lender, a global bank, asked to extend its membership to the NewConnect. So it means that this class has become more and more internationally recognized market.

Structured products here, we continue with the expansion of the -- of the product. We currently, we have 1,700 products. Plus, we observed the interest of our clients, especially of retail clients because this is the possibility to trade through, of course, structured products different commodities. And also, this is the access to foreign indices and stock.

On ETF segment, we are expecting 2 or 3 more ETF by the end of the year. We started from the low bases. But every quarter, we observed increasing interest and turnover volume. The exchange is very much focused on innovation and especially innovative companies. So we organize every quarter or even more frequently, the so-called GPW Innovation Day, and we connect the company with the investors. So the last time, we had almost 1,000 participants. So it means that the investors are looking for the innovative companies listed on our exchange.

The liquidity is the key thing for us. So we continue our liquidity programs. And in Q3, we reopened a high-volume fund program. We -- this is the program for quantitative funds. And currently, we have one participant of this program. The share of high-volume providers, this percentage is a bit lower than in Q2, but nominal -- a nominal increase of the activity.

So let's go to derivatives slide, and this is Slide #6. And some -- on derivatives side, we had the increase of turnover volumes in Q2. So year-on-year, it was almost 18% plus, but comparing to Q2, it was minus 15%. And so again, holiday months, plus when you look at the slide in the bottom on the left-hand side, so you can see the lower volatility in Q3. And the lower volatility has always -- it has an impact on the volume. So what we observed is increasing interest in single stock futures. So in October, as Marek already mentioned, we implemented 4 new contracts, 3 on COVID companies and one on Allegro. And I think that is underlying that we are really able to very quickly implement the new products, the new single stock futures. So our time to market is very short. We observed high volumes and interest of investors, plus we signed agreements with market makers. So we are really very quickly ready to implementing the products. Also, on -- in derivatives segment, we have active high-volume provider program, and the new participants joined in Q3. Also, we managed to find the new market makers for our blue-chip or our flagship, I would say, future contracts based on WIG20 index.

So Slide #7, this is my favorite because I think that this is a very nice slide summarizing the overall business in 2020 in 9 months. So we're very happy to report a percentage increase in each product line. So even the niche instruments so far -- niche instruments gained interest of investors, and we hope that this will be continued.

On the Slide #8, so there is the message about our ESG development. And as our CEO, Marek, did already mention. So ESG is very important topic for us. And I would like just to try to touch this issue from a very business angle. So when you look at the figures, and for example, the JPMorgan report, which -- in which we found the estimation of the assets under management of ESG funds, it is like USD 45 trillion. So it means there is a huge market. And also, when we look at the level of global assets in ESG EPS, plus taking into consideration our -- the results of our roadshows with the global clients and formats, that in 2021, they want to be very focused on ESG criteria, even with 100% integration. So this is for us a very important message that we need to prepare our company and our market for this important trend. So currently, our actions are, I would say, twofold. So preparation of our company to ESG reporting and then the support for market participants. Like our issuers and also local institutional and retail clients, plus some analysis on the -- which are conducted by our daughter company, GPW Benchmark. And this analysis, they are connected with the new benchmark, low carbon benchmark.

So in the framework of preparation of our company to ESG, we continue to develop the ESG policy and also the way how we would like to report ESG factors to investors. So to be honest, we are not the beginners. Is it very up, because currently, we are -- also, we published this year already the integrated report. So the report covers financial and non-financial results. We are in touch with Sustainalytics analytics because we are also the participant of WIG-ESG index. Currently, the Sustainalytics assessed us as a low-risk company. And last but not least, the company dedicated the member of the management board who is responsible for further ESG development.

So this is all from my side. And I would like to ask Piotr Borowski to continue.

[Piotr Borowski, executive]

[Foreign Language] Financial market results financial results of our group, the revenue were up in Q3 by 7.2% year-on-year. And it was mainly due to the activity of the financial market and The Warsaw Stock Exchange. In Q3, we had also higher operating expenses. It was mainly due to the higher personnel costs. So we are working on our new development projects, hiring new people for the increase of external services and there was also higher fee for the market supervision. It was already a surprise -- the whole market was surprised because the futures by the Polish FSA was higher by 100% when compared with the last year. It resulted in a lower EBITDA at the level of PLN 47 million, and lower net profit, at the level of PLN 32 million.

Slide 11, the result of this higher cost base was the lower EBITDA margin, which was the end of this quarter 53.2% and lower net profit margin on the level of 36.2%.

Slide #12, results of the Warsaw Stock Exchange and the financial markets. So we're very glad that we build the activity of the market, the volatility and high volumes. We still had a very high market average electronic order book volume daily and also a very good strength in [indiscernible] because we have begun a number of small transactions. And the small transactions are much more profitable for us. So the average fee per trade was at the level of 2.31 bps and that was a record high. It is a result of small orders posted to exchange by the retail investors because we observed in this year big shift from bank deposits to the capital markets. And the increase of the retail investors and trading on our stock exchange. In the past, it was around 10%, 12%, now it's over 20%.

Slide #14 (sic) [Slide 13] Listing revenue, it was stable year-on-year. We had growth activity. We had 7 small IPOs in the NewConnect market. Our [indiscernible] market, but still they are very low, a small-cap, doesn't have much impact on our revenues. Nevertheless, we are happy that this market is still alive and very active. And what is worth mentioning is that in Q3, we had a quite active SPO market. We have new listings, secondary listing of new shares.

On Slide #14, market data. Market data is growing steadily, a very stable business line and also developing. This year, we are very glad of increasing number of individual subscribers. Again, it's connected with the activity of the investors. But also we have a new data vendors and nondisplay professional data users.

So at the moment, I ask Piotr Listwon to present commodity.

[Piotr Listwon, executive]

Thank you, Piotr.

Slide #16. Let me present to you the level in the third quarter of 2020, divided into 3 main business lines, which is electricity, natural gas and property rights market.

Starting from electricity. On the electricity market, the main event of 2020 is still intraday market development, which are day volumes rise continuously quarter-by-quarter. So after third quarter, they amounted to 1.5 terawatt compared with 0.3% of terawatts in the first 3 quarters of 2019. So you we can see dynamic change in the volumes in the intraday market, mainly caused by European intraday energy market that we started offering to our clients in November last year. Thanks to intraday market, we achieved year-on-year growth on the whole electricity spot markets by 5.1%. However, despite of the good results of the spot market, we have noted a decrease in the overall trading volume of electricity due to lower volumes on the -- our main market, which is electricity forward markets. Decrease was -- decrease is about 18% quarter-on-quarter and 21.8% year-on-year, which means it was the worst quarter on the electricity forward markets since second quarter of 2019.

We have noted growth on this market in July. But after the announcement of the potential removal of the exchange obligation of electricity producers, volumes started to drop. In August and in September, there was a decrease by 1/3 on -- year-on-year on this market. Lower volumes of this market are explicable by every -- by a very large volumes of annual contracts concluded in the first half of 2020, mainly in time between February and April. Nevertheless, it's also clear that there is a significant impact of the possible removal of the exchange obligations since it concerns delivery years that included 2021, and hence, also affect trading on new instruments on the electricity forward markets.

There was also a year-on-year decrease in the volumes of natural gas contracts. But unlike to the electricity forward market, there was a slight increase quarter-on-quarter which is 31.7 versus 31 terawatt hours. It's on the level near 3 previous quarters thereby. The decline of overall gas volume comparing to the previous quarters is the result of low spot market volumes. This is usually in the summer time. On our natural gas spot market, there was even a 4.7% year-on-year growth, so 3.6 terawatt hours. But this decline in the gas forward market can be put down to the limited volumes of annual contracts that could be -- could have been expected after the record-breaking first half of 2020 and growth by 58% year-on-year.

On the different business lines. On the Green certificates market, we have noted a significant drop of volumes quarter-on-quarter by 25%, and -- but it should be explained by seasonal changes caused by the certification redemption deadline which is the end of June. Therefore, the year-on-year comparison, it's much better for the third quarter on the property rights market. And it comes to the Green certificates we have -- we have had 6% growth. Unfortunately, there is also a drop in liquidity of the energy efficiency certificates market, so-called white certificates. It has even deepened in the previous quarter.

We have got now new options white certificates issue in the previous months and the new white certificates are being issued at a slow pace by Polish MRA. At the end of September, we've got -- yes, at the end of the September, we've got -- registered a decline in the overall volumes of white certificate issued by MRA. That amounts to 60% year-on-year from 189 kiloton to 75 kiloton of oil equivalent. As a result, we have got also a 86% decline in the third quarter trading volume, but it's also due to the comparison with the second best quarter of the market, which was in the third quarter of 2019 last year, when the price of options of white certificates soared up [indiscernible] was prolonged.

When we move to the next, Slide 17, will be revenues from the commodity market. At the beginning, I would like to let you know and to bear in mind that the revenues from commodity markets are strongly correlated to the total volumes traded on the market in a given period. That's why in the second -- in the third quarter, we have noted a decline of revenues from electricity and gas markets. This is a result of trading volumes decline that I described earlier. A large decline of energy efficiency certificates trading volume is caused -- caused revenue decline on the whole property rights market. These revenues decline amounted to 7 -- 27% year-on-year, that occurred due to huge 86% decline on the white certificates market, even having 6.9% growth on the green certificates.

On the next 18th slide, we have information about the revenues from clearing and also revenue from operation of the register. So on this slide, you may observe some drops of the revenues from the clearing from drawing certificates of origin. Revenues from clearing amounted to PLN 9.6 million. That means the drop of 11.1% year-on-year. Is the result of trading volumes drops that occurred on electricity, natural and energy efficiency certificates market. This drop is lower than analogical one-off trading volumes -- trading revenues.

The reason of that is the revenues from clearing of electricity forward markets trading on organized trading facility comes also from clearing and treatment of open positions traded in the past for delivery in particular quarter. So this is the reason that the revenues from clearing are a little bit better than on the exchange. Certificates of Origin Registered dropped year-on-year by 37.8% to PLN 3.8 million. Primarily, it's the effect of lower volumes of green and white certificates issue and presented. And the last information, we have also a slight 1.8% year-on-year decline of Guarantees of Origin revenues. We expect higher volumes in November and December as end of the year is a deadline which guarantees should be executed.

So this is all for now from the commodity perspective.

[Piotr Borowski, executive]

Thank you, Piotr. I will continue on other financials. We are on the Slide #20. Operating expenses, there was increase of operating expenses year-on-year by 37.9% and 10.6% quarter-on-quarter. The main contributors of this rise of, again is the high fee for the market regulator, which I mentioned before, and also the total employee costs has been connected with our new business development program. But what's is worth mentioning, I think, on the personnel costs, that there was an increase of 15% year-on-year, but quarter-on-quarter, they were flat. We also created a provision against interest on potential tax payable at IRGiT. IRGiT is the clearing house for the commodity market.

Slide #21. Share of profit of entities measured by equity method in Q3, it was flat with the year-on-year and quarter-on-quarter. And the main contributor here is the net profit of the KDPW Group, which is a Polish national depository for securities and clearing house.

Slide #22, consolidated statement. It's a high level of liquid financial assets. I just want to mention that in the third quarter, in August, we paid a dividend, PLN 100 million. It was a PLN 2.40 per share. And dividend yield -- was 5.5%. And it was the last slide of our presentation. Thank you.

[Operator]

[Operator Instructions] At this time, we have no telephone questions. So I hand back over to you, Pawel.

[Pawel Wieprzowski, analyst]

Okay. So I have a few questions, in fact, if I may.

First question is, what are the chances or risks, whatever you call it, of lifting this obligation of electricity trading? And what is your gut feeling in terms of what kind or what part of volumes that you have currently on the electricity market trading [indiscernible] following this lifting of the obligation?

[Marek Dietl, executive]

Piotr, can you please -- can you handle this question, please?

[Piotr Borowski, executive]

Yes. Thank you. So the question about the chances. As we are aware, currently, we are waiting mainly on the public information about we -- what has happened already about the coal miner labor union agreement between, yes, coal miner labor union and Polish Government. One of the point is just saying that it's -- obligation to trade and the exchange will be removed from Polish regulations. Currently, we have no further information about that. We know that some discussion will be between Polish government and European Commission concerning possibility of having some -- concerning the current situation about the coal miner companies and some help from Polish government to them.

So we are -- we don't know exactly what will be the final result of the discussion between government and European Commission. And also, we currently are expecting of some project of the regulation -- resolution that will be presented, showing what our Ministry of Climate would like to change in the provision concerning action application. So we are expecting that such project of resolutions will be given to public consultation. And we will see what will be the final result of that. So currently, we have no further information about this project and what will the final project resolution, for example. So we are still filling the time and waiting for that.

Concerning your question about what would be the impact of the changes in current obligation, I could say that, of course, so we have some estimation concerning that. What I can say before that's we have -- we all have to know that obligation -- the current obligation, which is in the resolution, Polish resolution, it says that it 100%. But effectively, it's not like that. We count that it is around 55% to 60% because there are some exclusions from the obligation. So we see that it might be possible that if total removal of the obligation trade on the exchange will be enforced, we might have the impact of around half of our trade volumes on the forward electricity market could be impacted on that.

[Pawel Wieprzowski, analyst]

Okay. Perfect. My next question refers to the concerns, the acquisition of our Armenian Stock Exchange, which has been, in fact, put on hold until the military unrest in the region eases. Do you see any further acquisition targets among smaller stock exchanges in the region?

[Marek Dietl, executive]

I'll handle this question. This is Marek. Well, we look -- our M&A strategy as -- we continue our M&A strategy. So we look for fresh companies and we look for the trading venues, stock exchanges. And in both cases, it's quite difficult to foresee what will be the results of our M&A activities. So the in case of tech companies, we are more -- we're working still on our CVC, Corporate Venture Capital, just to outsource the selection of companies and growing them. We might consider to invest from our balance sheet, but we'd rather prefer to outsource that.

And in case of stock exchanges or trading venues, it's heavy political decisions so -- and for example, in case of Armenia, it took us over one year of discussions with various stakeholders. So you never know what will come out of these talks. But we are generally interested and if someone approaches us we always treat it very seriously. So we will be very happy to integrate the region, but if there is supply of companies, I don't know. There's definitely demand from our side, but we'll see if it's going to work out. And what I would like to assure you, not only the -- there should be a strategic [indiscernible], but also very -- I mean, a clear value-added for our shareholders. So it's a pure business decision for us to go for M&A.

[Pawel Wieprzowski, analyst]

Okay. And in case of acquisition of this technology company, you'll aim at later on developing them and incorporating them into your business group or you will just aim at developing them and sell them?

[Marek Dietl, executive]

Yes. I mean there's -- initially, we wanted to buy majority, preferably 100% and integrate them with us indeed. But we worked on several cases over the last 2 years, and we are never successful. And it's simply because the tech companies today have so great opportunities around that it's very difficult to convince the founders that they should exit now. That's the problem. All it gets -- the valuation get to the skyrocket when they have to exit and then it makes -- we don't see that much synergies. So currently, we rather move for minorities stake. That's why the CVC idea. And we would rather benefit a little from equity. And also, we need to be a first client or a important client to help them grow globally. So of course, if there's opportunity to take over the full, take over 100% of the majority stake of the company, we will look at it too, but it's -- after of those 2 years of trials and errors we would rather be -- focus ourselves on minority stakes.

[Pawel Wieprzowski, analyst]

Okay. Cool. My last question concerns the dividend, potential dividend payment next year. It seems that this year will be record high in terms of your profit. 9 months EBITDA trended over PLN 160 million, that's the second highest EBITDA in your history. So I was wondering whether we can expect certain upside potential to the dividend. In your strategy, you declared that you are going to pay a fee PLN 2.5 from 2020 profit. So I was wondering, given the fact that the acquisitions that you have on the table, I mean there are [indiscernible] of PLN 6 million, you spend on dividend roughly PLN 100 million. So the potential acquisitions are not game changer in the dividend story. So I was wondering, given the very strong results this year, no material M&A on horizon. Can we expect something more than just this PLN 2.5 dividend per share next year?

[Marek Dietl, executive]

Well, a long question and pretty short answer. We have very good results, that's true. But our main focus is end of 2022 when we promised the shareholders PLN 470 million in revenues and PLN 200 million in EBITDA. And this is our primary focus. Of course, we share our -- the profits with the shareholders, but our priority, top priority is not maximizing the dividend payout, but to get the strategy done in the way that the revenues will be around the numbers I already mentioned by the end of 2022. So having in mind those priorities, we still hope for both organic and inorganic growth. So we are not tempted to change a single word in our dividend policy. Of course, life is quite complex, and we might change our mind. But currently, I don't see any reason for changing our minds. We have to invest and -- in order to get to the KPIs we promised to our shareholders.

[Pawel Wieprzowski, analyst]

Okay. But if there are no acquisitions, no material acquisitions next year on the table, and volumes are still strong, we cannot rule out that the dividend may be, in fact, slightly higher or higher than this minimal level of PLN 2.5? Is that correct?

[Marek Dietl, executive]

Yes. The issues with acquisition that you never know when it comes to a situation. And interesting -- actually, if there is something interesting in the market, we have to act quickly. So we rather keep cash at hand. If by the end of 2022, we will -- we will see that there is nothing to invest in, of course, we will not hesitate to pay out this money to the investors. But still, we are hoping to get some investment done. And also, don't forget that we have some investments in pipeline like trading system, we also might -- of course, today, it's a little bit tricky to buy a building, but we might -- we find an intention later to buy the -- our business office building. So it might happen if the valuation is attractive enough and valuations of office buildings are getting attractive. So we might also spend money on that. So plenty of opportunities we see in the marketplace. The dividend yield of around 5% of -- in the current interest rate levels is still attractive for our shareholder, and it will be increased in the next years. So currently, we don't see any reason for a change in our dividend policy.

[Pawel Wieprzowski, analyst]

Okay. Perfect. My last question securities lending platform because that's one of your strategic initiatives that should be launched soon. Do you happen to know the date when we shall see the initiatives being launched?

[Piotr Borowski, executive]

But we can share with you.

[Izabela Olszewska, executive]

This month.

[Marek Dietl, executive]

Securities lending, well, we hope that there will be a new law passed, new law or amendment to the law passed this year to the parliament, and then we will be able to start this initiative. There is still unclarity to the law on this and this also needs to be cleared. So this is a very precise question. So not later than year after the government makes the law.

[Operator]

There are no telephone questions. So I hand it over to you, Pawel, to see your end remarks.

[Pawel Wieprzowski, analyst]

Okay. Ladies and gentlemen, thank you so much for attending the call. It's been a pleasure to host all of you. I hope you enjoyed it. Have a safe weekend. And let's stay in touch until the next conference call next year. Thank you so much. Have a great weekend..

[Marek Dietl, executive]

Thank you.

[Piotr Listwon, executive]

Thank you. Bye.

[Marek Dietl, executive]

Great weekend and take care.