SZLMY (SZLMY) Q1 2026 Earnings Report, Transcript and Summary

Ladies and gentlemen, welcome to the Swiss Life Q1 2026 Trading Update Conference Call and Live Webcast. I am Sandra, the Chorus Call operator. [Operator Instructions] The conference is being recorded. [Operator Instructions] The conference must not be recorded for publication or broadcast. At this time, it is my pleasure to hand over to Matthias Aellig, Group CEO of Swiss Life. Please go ahead, sir.

Good morning, ladies and gentlemen. Thank you for dialing in and for your interest in Swiss Life. Today, we are reporting on selected top line figures for the first quarter of 2026. I will start with an overview, and our Group CFO, Marco Gerussi, will give you more details. We had a good start to the year with pleasing top line growth in the first quarter of 2026, both the fee and the insurance businesses contributed to this growth. Swiss Life increased its fee and commission income by 6% in local currency to CHF 686 million, with all businesses contributing. Gross written premiums, fees and deposits received increased by 5% in local currency to CHF 8.2 billion. Swiss Life Asset Managers reported strong net new assets of CHF 4.2 billion in third-party asset management compared to CHF 9.3 billion in the exceptionally strong prior year period. The SST ratio was estimated to be around 210% at the end of March 2026. I'm particularly satisfied with the growth in our fee income across all divisions and businesses, meaning asset managers, owned IFAs and own and third-party products and services. We are well on track with our Swiss Life 2027 program. In addition to our first quarter disclosure, we are announcing today, the acquisition of TELIS Group at Swiss Life Germany. With around 1,800 advisers and the fee income of more than EUR 200 million, TELIS is one of the leading German IFAs. With the acquisition, Swiss Life Germany will further strengthen its position as a leading financial advisory company. Combined, we will have, in Germany, around 8,000 certified advisers and a total fee income in excess of EUR 1 billion. This was a unique opportunity that we have seized from the founding family, who will stay with us in an advisory role. I'm pleased that with this transaction, we accelerate our profitable growth in the German IFA market. And I would like to welcome TELIS within the Swiss Life Group, look forward to their contribution to Swiss Life Germany. With that, I hand over to Marco.

Thank you, Matthias, and good morning. I'm pleased to walk you through our trading update, looking at our good first quarter 2026. As usual, all figures are unaudited figures for the group are reported in Swiss francs and for each business division in local currency. Growth rates are stated in local currency. Let me start with our business division, Switzerland. Premiums increased by a strong 10% to CHF 5 billion. Life insurance market remained flat. Premiums in group life grew by 10% to CHF 4.5 billion, while the market decreased slightly. Single premiums increased by 25%, driven by higher premiums from existing clients and new business. Periodic premiums declined by 3%. Assets under management in our semiautonomous foundations were at CHF 8.1 billion compared to CHF 8.4 billion at year-end 2025. The decline is due to negative market performance and the net transfer into our full insurance business. Premiums in individual life grew by 7%. The overall market was up by 5%. Single premiums grew by 20%, driven by the unit-linked business. Periodic premiums declined by 1%. Fee and commission income was up by 2% to CHF 93 million, mainly due to higher income from unit-linked and investment solutions for private clients. Turning to our French, German and International business divisions, which all report in euros. Let me start with France. Premiums were down by 2% to EUR 2 billion. The total market was up by 11%. In our life business, premiums were down by 1%, driven by lower premiums in the savings and pension business. The overall market grew by 14%. The unit-linked share in our life premiums increased to 73% compared with the market average of 41%, reflecting our unchanged focus on unit-linked solutions. We generated life net inflows of EUR 0.6 billion. Open market net inflows were at EUR 19.3 billion. In health and protection, we kept our focus on profitability before growth. This resulted in a 7% decline in premiums. Market growth was at 7%. EMC premiums grew by 4%. Fee and commission income rose by 8% to EUR 166 million due to higher unit-linked fee income based on higher average unit-linked reserves and net inflows. The income contribution from structured products remained stable at a pleasing level. I continue with Germany. Premiums were up by 3% to EUR 425 million, driven by modern and visibility products as well as a higher single premium. The market decreased by 6%, mainly in single premiums. Fee and commission income rose by 5% to EUR 238 million, supported by both a higher productivity and a higher number of financial advisers at owned IFAs. Compared to the first quarter in 2025, the number of financial advisers grew by 3% to 6,154. These numbers do not reflect the acquisition of TELIS Group, which we announced today. With this transaction will further strengthen our position as a leading financial adviser in Germany and further grow our advisory base and the fee results. Closing of the transaction is expected in the third quarter 2026. Turning now to International. Premiums decreased by 3% to EUR 1.1 billion. Higher premiums with corporate clients were more than offset by lower premiums with private clients. Fee and commission income increased by 2% to EUR 94 million, driven by higher income from owned IFAs. In February 2026, we announced the partnership between Swiss Life Network and Generali, concerning a small part of our Employee Benefits business. The fee income reported today excludes this business. Let's move on to Asset Managers, which reports in Swiss francs. For your information, we have expanded our disclosure for Q1 and Q3, in line with our full and half year reporting. We now disclose total income, which consists of the commission income and the other net income, including the real estate project development. Asset Managers total income rose by 12% to CHF 261 million. In our PAM business, total income increased by 4% to CHF 90 million. Increase is mainly driven by higher real estate transaction income. In our TPAM business, total income grew by 16% to CHF 171 million. Increase in recurring income is due to higher assets, while the higher nonrecurring income is largely real estate transaction income. The share of total nonrecurring income for TPAM, meaning commission income and other net income from real estate project development, was at 13% compared to 6% in the prior year. As mentioned at our full year results disclosure for each 2026 and 2027, we expect to achieve a share of around 25%, which is in line with our Swiss Life 2027 targets. Net new assets in our TPAM business amounted to CHF 4.2 billion compared to CHF 9.3 billion in the first quarter 2025, which was exceptionally strong. We saw continued strong inflows in our index business, and inflows in real assets amounted to CHF 0.8 billion. Both these inflows were slightly offset by outflows, in particular from money market funds. Assets under management in our TPAM business increased to CHF 148 billion compared to CHF 146 billion at year-end 2025. Net inflows were partly offset by negative performance. Turning to our investment results. Direct investment income decreased by CHF 142 million to CHF 0.9 million due to lower income from equities and infrastructure, which included the sale of infrastructure assets in the prior year. Additionally, we had various movements in the foreign exchange rates, particularly related to the U.S. dollar. The non-annualized direct investment yield was at 0.7% compared to 0.8% in the prior year period. Looking at the net investment income, we had a stable development compared to the first quarter in 2025. Real estate continues to be an attractive and important asset class for backing our long-dated liabilities. Vacancy rates decreased to 2.9% compared to 3.1% at year-end 2025. Real estate fair value changes, which is non-annualized, were positive at around 0.3%. For the full year 2026, we expect a similar trend that in 2025, further positive real estate fair value changes driven by our Swiss real estate portfolio. Moving to solvency, cash and payout. At the end of the first quarter of 2026, the SST ratio was estimated to be around 210%, and therefore, marginally below year-end 2025. This is due to market movements, which more than offset the positive impact from a hybrid issuance in January 2026. As of today, we estimate our asset ratio to be at the same level as at year-end 2025, well above the ambition range of 140% to 190%. At the end of the first quarter, liquidity at holding amounted to around CHF 0.6 billion. Our ongoing share buyback of CHF 750 million is well on track and will run until the end of May 2026. As of 15th of May 2026, we repurchased shares worth 726 million. Let me sum up. We are pleased with the performance of Swiss Life in the first quarter of 2026. We grew both our fee and our insurance business. Moreover, net new assets in our third-party asset management business increased. And our asset ratio is at a strong level. With this, we are well on track to achieve all of our group financial targets of our Swiss Life 2027 program. And with this, I hand back to you, Matthias.

Thank you, Marco. We will now open the Q&A session. Who would like to start?

[Operator Instructions] Our first question comes from Michael Huttner from Berenberg.

Fantastic. And well done for really good results. I had 2 questions. One is on TELIS and one is on the nonrecurring. Can you give us a feel for what TELIS will do? I know you say raise your fees, but on a kind of run rate basis, how much would it add to profit? And then -- the -- on TELIS, I don't know how to ask it, but I'm really trying to find out how much it costs, but maybe you can kind of give us a feel for what it would do to solvency when the deal closes? And then on the nonrecurring, so up from 6% to 13%. Is this actually now cash deals? Or is it still kind of accrual based? It's just kind of -- and also, I know you said 25% is still on track. But if you had 6 -- if you're -- if you're far ahead of what you did last year and last year was 25% full year, is there a little bit of upside to come?

Thank you, Michael. Let me start on the TELIS acquisition. As you said, we gave the indication of -- for the year 2025 in terms of fee income. We said it's more than 200 million in terms of fee result contribution, so on the pretax and prefinancing cost basis, for the year 2025, you can, as an indication, take something between EUR 25 million and EUR 30 million. Now keep in mind that Marco just said, we expect closing somewhere in the third quarter. So if that materializes, as we assume, first year where we have a full run rate here will be 2027. Now in terms of the costs, I mean, we have agreed with the founding family, the seller, not to disclose -- you can assume it had no relevant impact whatsoever. In the end, it's a fee business. It's not an insurance business, obviously. So I think that's in respect of TELIS, and let me go on with the question on the nonrecurring income, what we report for Q1, the 13% nonrecurring income, so meaning commission income and the net income from project development that is fully cash. In terms of the full year, construction this nonrecurring income exhibits really variations quarter-by-quarter, and I wouldn't read anything in the fact that we have now 13% and to 6% in the prior year. We clearly said we expect for the full year 2026 is around 25% that Marco said.

The next question comes from Thomas Bateman from Mediobanca.

Could you just come back to TELIS? Could you just talk us through a little bit more about your strategy in Germany, but also how TELIS would fit into your platform? I don't know I'm thinking here more along cost savings potentially from TELIS moving their drivers onto your platform. Is that something that we should think about in the long term? And the second question is just on investment income. Clearly, there was a little bit of a drop this year. Can you give us a bit of a feel for the outlook for investment income for the full year?

I will start with the questions, TELIS, and Marco can give you then some color on the direct investment income. Now on TELIS, I mean, our strategy in Germany, I think that was very clear from the Investors Day, we want to further grow our IFA business in the German market. We were starting in the program with a strong position. We had, as a result, also quite significant missions in terms of fee result. We mentioned that we are working in the current program, also a bit more on the back-end systems. And that as a result, let's say, the fee result target of more than [ CHF 150 ] is a bit back-end loaded within the program. And this is fully true what we said. We now have -- just had the opportunity to accelerate that strategy. And as we always say, all the targets we have are organic. But when there is this opportunity to go for something that fits strategically, financially and culturally, we do that as a bolt-on transaction. That's what you have seen here. It's really an acceleration of our strategy in the German market. With that, we further strengthen our leading position in Germany. Now on the second question that you had in terms of potential synergies, what is important is that we clearly will retain the brands of TELIS. We will, as we have done it with the other brands that we have in Swiss Life in Germany, we'll retain the brand of TELIS. But clearly, over time, there will be synergies in the back office. There is a platform we -- I'm sure Swiss Life in Germany can also learn from TELIS. And here, we are clearly positive that TELIS will contribute positively to the fee result, starting on day 1 in Germany. With that, I hand over to Marco for the investment income.

Thank you relating the investment income. So as I said during the presentation, the decrease we have seen is to some part refers to a sale in the infrastructure area. The parts of the proceeds were distributed as a direct investment income in the prior year period. This is somewhat now missing in the numbers in the first quarter 2026. And there is another effect, I would say that's more technically related staff referring or relating more to timing. That's something we will see later on. And there is a smaller part relating to U.S. dollar assets movements on the direct investment income. The yield on the direct investment income, I would say, this is something we expect to be at a similar level than in the prior year 2025. And as I said, also additionally in the presentation on the net investment income is we had a stable development compared to the prior year first corporate period in 2025. And the net investment income finally is one of the -- important for our results.

Can I just -- just one follow-up on the liquidity holding number that you gave, the 0.6 billion. Is that inclusive of the acquisition of TELIS?

I mean, as we said, we are closing the deal in the third quarter, that's [indiscernible].

The next question comes from David Barma from Bank of America.

Just to confirm on TELIS, Matthias, thanks for the details, but you are saying you don't expect any material impact on either holding cash or remittances from Germany, if that's correct? And then secondly, on the solvency ratio, could you please give some details on the movements in the quarter, and particularly on the market effects? And linked to that, the interest rate differential widen in Q1 and continue to widen in Q2. So if you could talk a little bit about the potential impact on the SST and the CSM, please. And then lastly, on France, the fee income growth continues to be really good. If you could give some color on new business growth there?

I hand over to Marco for the SST and the French question. I will end with the TELIS question.

So on the solvency, I mean, at the end of the first quarter, the marginal decrease to around 210 comparing to the 213 at year-end '25, this is mainly due to market movements in equities and credit spreads. That's something that recovered than year-to-date. And as of today, that's why we are saying we are at the similar level than at the year-end. The differential was just the marginal one of the very, very let's say, there are many smaller items moving a bit up and then the down, but that is not, let's say, an unmanageable impact on the numbers. And overall, same. Speaking about the economical part of the CSM, I must say that the same holds true also for the CSM development. And the question on the French business on the fee income, quite pleasing growth that continues there. You're absolutely right. This is mainly due to the unit-linked income, and that's based on 2 facts, it's net inflows, so new business we write there, but also some positive market effects on the underlying assets for the reserves, the unit-linked reserves. I think I said that also during the presentation, one part of it is -- continues to be the structured products. We sell and offer in the French business together with our bank. It is very pleasing and stable, but a very pleasing level and also contributing to the overall higher numbers.

Now maybe coming to a question on TELIS, David. I mean, what are the impacts of that acquisition? I talked about the acceleration of the strategy in Germany and what we clearly expect from this acquisition that we will see high fee result. I've just mentioned the 25 million to 30 million that TELIS has achieved in 2025. I mean again, that's a pretax and prefinancing cost number, but that's what we clearly expect as a number going forward. I mean this is an asset, as I said, is fully functional. I mean we expect such contributions starting day 1 asset, but 2026, not on a full year basis. And with the fee results, they are corresponding remittances. Now your question in terms of cash at holding was probably more geared towards the financing of that acquisition. You may have seen that we have issued a senior bond, EUR 500 million senior bond for general purposes in April, and a large part of that will be used towards the financing of that acquisition. So per se, and I think that the point, there's no impact on the cash at holding due to the acquisition per se. Over time, I said there will be this higher remittances.

Next question comes from Nasib Ahmed from UBS.

Three for me. Firstly, on TELIS. Can you just kind of help me understand the margin on that business relative to your own German IFA business? It seems like it's a little bit lower than what you're targeting in 2027? Second question on the holding company cash development. You've issued some senior debt already. So what's the holding company cash position today? And is that going to be used for the buyback at 1H? And then finally, on political changes in Switzerland. So you've got the population control both Lex Koller, rental control in Zurich. Have you done some sensitivities on what that would mean for your business if they -- if those things go against you on the real estate market?

I think I hand over to Marco for the holdco cash because at the end, it's a Q1 call and not the TELIS call, but that will take then TELIS and the political things after that.

So the cash at holding as of today is 1 billion, I think, is important to consider senior bond we issued in April, the EUR 500 million that Matthias just mentioned, which is for business purpose. So that's money for TELIS, so a large part, as Matthias said, but also then the remainder put at work in our operating company. So overall, no impact on the cash level at holding. And I think second point to make, which is also very important, we don't use on the transactions or issuance for share buyback financing. So that's completely to be separated.

And maybe on the political developments, you mentioned a couple of them. And maybe let's start with this initiative on federation level in June around the sustainability, as it's called, on immigration. Look, this is, first and foremost, a political decision. That's why we do not comment too heavily. I think there, what is important for us that irrespective of the outcome of that [indiscernible] vote, that policymakers in Switzerland continue to make sure Switzerland is and remains an attractive place for doing business in the interest, let's say, of the prosperity of the country. And to be frank, in Switzerland has a very good track record on that. And in that respect, we are not particularly concerned about that vote. Now on the Lex Koller, there is this recent proposal by the federal council. This is at the very early stage of the process. I mean this is a proposal where now everybody can give input. And clearly, we think this is a very bad idea going forward. There are very good arguments against it. It doesn't solve any problem. It's not feasible. I will spare you the details of it. What is key I think is every now and then -- and if I look back the last 10 years, probably every other year, every 3 years, there are proposals that either are coming from the Federal Council, but mostly from the parliament they are discussed. We take them seriously, don't get me wrong, but there are very good arguments against them. And then after a while, they just disappear asset because they do not solve any underlying problem. In terms of the initiative in the state of Zurich, also something we take obviously very seriously, similar to what I just said on a federal level, the initiative doesn't solve any problem. I mean, it just -- would lead to a situation where existing real estate kind of becomes even more valuable because I mean you can -- but there will be less investment activity. But again, same thing. We have, I believe, very good arguments against it, and we are pretty confident that this will not materialize. And last question was on TELIS. I think if you were asking about the margins, as said, it's a very similar business. It's a very similar business mix. The numbers that I've given to you made the case that it's broadly in line with again, we have taken it for strategic reasons to make this acquisition and not for any, let's say, margin differentials or anything like that. Hope this gives some clarity on it.

Yes. That's very helpful. I was just wondering on the political stuff, that's helpful in terms of where you're thinking is. But can you give some exposures on your business or some sort of kind of sensitivity on this thing? And I think there is policyholder sharing on the rental income, et cetera. But anything that you can give around what the impact could be for Swiss Life?

Look, I mean, this is pure speculation at this point in time. I mean, again, what I think is important that you can take with you is the statement I've made about the federal initiative mid-June. In Switzerland, there is a clear sense that we have the interest of maintaining Switzerland as an attractive business hub. And anyway, there will be pragmatic implementations of it anyway. So to that, let's say, level, I wouldn't, let's say, expect for us as a company, very, very material impact.

The next question comes from Iain Pearce from BNP Paribas.

The first one is just on the Switzerland top line growth, obviously, very strong in Q1, particularly on the Group Life business and the -- sorry, so particularly on the Group Life business. Could you just talk about -- a little bit about what's the drivers of that really strong growth? And particularly, are you seeing any benefits of sort of disruption you might be seeing at peers? Second one was just on France. So some of the disconnect between the top line and the fee income. So it sounds like unit linked is growing quite strongly. Could you just talk a little bit about what's going on in the other businesses in France, particularly what you're seeing on the top line in Q1? And if I could just get a third one in as well on the investment result. So the sort of growth versus net investment result and saying the net investment result is sort of stable year-on-year, but the gross investment result will improve. Does that mean you expect the net investment result to improve year-on-year? Is that what we should be reading to that? Or are you sort of guiding flat on the net investment result year-on-year?

Iain, I leave the question Switzerland and the investment income to Marco, and I will try to answer the French aspect.

Yes. So on Switzerland, the group life business top line you referred to, I mean there is, as you said, an unnoticed quite a very pleasing growth in those premiums. Driver behind it is single premiums, and this has 2 sources, one is existing clients we have that, let's say, put additional money of their businesses into those products, and the second driver behind it is new business. Because into our book, I would not make a direct link to any other developments in the market. So that's -- I would say that's -- in that, you know it from prior years in the normal course of our business that growth, I would say. And on the investments income, I think I elaborated on that in detail on the direct investment income on the reasons for that. This is some of the underlying assets being sold, that, that fix topic and also some timing related things that on a yield basis, we expect the year-end number '26 on the level of '25. Net investment income, I mean, I haven't said anything into the future about that we don't guide in detail. One thing I said is the real estate fair value changes. We had 0.3% nonannualized positive real estate fair value gains, and also expect that what we said during the presentation, a similar trend like in '25 also in '26, meaning further increasing fair values, mainly driven from the Swiss real estate portfolio. That gives you a bit of a flavor what we expect during the remainder of the year. I hope that helps.

And then let me come to the French top line development, maybe across the business line. I think what is important, we said it on earlier calls, Marco mentioned it today, not only in France, but also in France, I mean, we follow profitability before growth. I mean that's the underlying principle we have been following for years and the years and the years. Now what does it mean concretely? In the life business, we were able, with our focus on the capital-light unit-linked business to grow that business. We have been growing the unit-linked business, the share of unit-linked business. That's what Marco has shown the share in terms of unit linked in terms of premiums has grown significantly. We are way above the market anyway. But we have deemphasize this part which comes with the guarantees, that's so-called [indiscernible]. And there, the market has been behaving differently. Again, we put profitability first. And I think that explains a bit the development in the life business. So really focus on the capitalized unit linked solutions. In health and protection, similar picture. We are protecting the profitability. We have been talking about the turnaround that we achieved in '24, maintained in '25. We keep focusing on profitability in that business as well. That's why we incurred, as a result also of significant price increases, a reduction of the top line by 7%. That's a very -- clearly below the market. We stop contracts. It's really profit first. P&C, which is not a very big business, but there, we increased by 4%. Hope that shed some light on, let's say, the line of business view in France.

[Operator Instructions] The next question comes from [ Jonathan Brodin ] from Finance & [indiscernible].

Just probably last question on TELIS. Is it like this was -- was this deal necessary to reach your fee result target for 1 billion in 2027? Or is it just additional growth you're expecting from it? And also, you've talked -- you said that last time that your project development fees are back-end loading. So still like 2027 kind of coming in. What's -- can you give us an update on that? Do you still think this is back-end loaded? Or do you see some fees coming forward coming earlier than expected? And also maybe what's your take on interest rate movements in the euro area? I mean you're seeing a lot of inflationary pressures. Do you expect any impact from that? And then maybe lastly, looking into the future, what's your next strategic initiatives? I mean you've got in wealth manager in Switzerland. What will this wealth manager play? Will this wealth manager play in more important bigger role in your group business going forward? And -- or do you plan to broaden your private markets offering in your asset management? Also, you've got the non-life insurer in France, do you expect this? Or can you maybe say if you want to expand this offering into other markets? Yes.

Okay. Thanks. That was quite a wealth of question. I will take the last one, Marco, will say a couple of words on the real estate project development, and I will finish off with TELIS again. Now let me start with your first question. I mean, -- we are absolutely focused on executing the current program, Swiss Life 2027. I mean we have lots of initiatives going on here. In terms of the example, you have mentioned Swiss Life wealth managers in Switzerland. We clearly have said in December 2024. I mean Roman Stein, our CEO Switzerland, has said he wants to establish that business as a third core business. He is working with his team on that very diligently. And he, like -- as I said, the entire Executive Board, is working on implementing the strategy of the current program. I think we mentioned every time that we are well on track with the implementation of that strategy and that we are also well on the way to achieve the financial goals of program. So when there is an outlook to be made towards the next strategic period, I have to refer you to the Investors Day. The next one asset, we're currently focusing on the program at end. Marco will say a couple of words on the project development.

So on the project development, I think it's important that overall, I mean, we may use the term back-end loaded overall for the 1 billion or the above 1 billion target 2027 overall for the group in the fee result. And also in asset management, where the project development business is located, obviously, there is higher numbers. Why is it higher numbers during the different years? We have the total income growing. I think that's something we aim for, but the share of the nonrecurring part, including the project development business, that's something we expect to be around '25, this year, so in 2026 as well next year in 2027, again around 25% of that share. So the share of the project development business is equally distributed over the current and next year, but because the total income is higher, the absolute number, obviously, also becomes higher and contributes more to the at least 1 billion we aim for in 2027. I think that's the way how I can explain it. But overall, the business itself is not back-end loaded. It is dynamic during the year, over different years, but we aim for the 25% also this year.

And let me close that with TELIS. As I mentioned in my first answer is that we are well underway to achieve also our financial goals. And that is also the answer, no, we do not need the TELIS acquisition to reach our fee result target. Having said that, our strategy is organic. But if we see an opportunity that fits in terms of strategy, financials and also culture, then we are open to acquire a business. And here, we really had a very good opportunity, and that's why we clearly have seized it.

There was also one question. If I listen carefully to it, in regards to the interest rate environment, right? I mean, as always, we monitor those developments. It's for us, important because of our resilient business model we have shown also in the past that we can navigate ourselves through different rate environment, given the life insurance arm of our business as well as the real estate arm and a natural hedge we see, and therefore, we are still -- or still, we are in the base case environment, how we think about things, while obviously, always monitoring it and being ready to react. If, I have to say, necessary.

The next question comes from Matteo Lindauer from Vontobel.

A quick one on your European real estate portfolio. Could you give us some more color on the revaluation effects for the European properties? And also how did your vacancy rate develop outside the Swiss portfolio? And the second topic is on your net new assets. Could you give us a split of the inflows to the respective asset classes? Where were the strongest inflows you have seen in the first quarter?

I think I hand over to Marco for both.

I think it was even 3 questions. On the real estate, we reported the fair value changes, a positive change is 0.3% nonannualized, driven by the Swiss -- Swiss portfolio outside of Switzerland, I would elaborate on that or describe that that's rather flattish development with some movements of the positive fair value changes were clearly driven by the Swiss portfolio. Vacancy rate, overall, they decreased, positively decreased from 3.1 to 2.9. And this is almost, given also the underlying portfolio mainly driven by the Swiss movement. We had some positive effects also in the different branch portfolio, but we don't disclose that in more details. But overall, as you have seen, the number decreased. And in the net new assets, I'm also not disclosing all the details I mean, important for us, we have real assets at 0.8 billion, 0.7 billion of it is real estate inflows, 0.1 billion infrastructure. We have quite a large share of index business, so that's securities. And as I mentioned during the call, some outflows mainly related to money market. I think that gives you a good view on the flows, which are overall index driven, but quite a share of real assets.

The next question comes from Michele Ballatore from KBW.

Yes. My question is around more generally on M&A. I mean, I think, obviously, this is more a bolt-on kind of acquisition. But in general, in terms of the approach to M&A, what are you usually looking for in a target? And specifically, for example, in Germany, what is the competition that you face when you identify, let's say, a potential target?

Thank you, Michele. In terms of M&A, I think it's very clear, we have a bolt-on strategy, and bolt-on means we do opportunistic deals because our targets are organic. Bolt-on also means we do not go up too much in size. And if we look in terms of focus, it is clearly in our fee businesses, where we have prospectively and also retrospectively, put our focus. So meaning in the IFA businesses, in the asset management area, that's where we have been focused our M&A activity. What is key, and I think I've mentioned that -- also before for us, it's the strategic fit that is absolutely crucial. It has to accelerate our strategy. We need, obviously, the financials to be in line with our expectation. And most important or equally importantly, I would say, is the cultural fit. Because specifically in the areas of the fee businesses, there are people behind the success of those businesses. And retaining these people on board is absolutely crucial. And I think coming now to an example, in Germany, that's what we could offer. We could offer to the founding family an environment where we could clearly demonstrate, we would retain the well-established TELIS brand. And they knew, it's not just that we would claim it. We have a track record of that within our Swiss Life Germany IFA roof, if you wish. We have 4 different brands. Now we will have a fifth one that we have developed that have given individual financial advisers the opportunity to grow, to develop. And I think that's something we have had as, I would say, unique -- a unique offering kind of to the founding family who, as I said, will stay with us on board. I hope that gives some indication, M&A approach, how we think about it and specific also what this meant for the German transaction.

The next question comes from Henry Heathfield from Morningstar.

Just a few quick clarifications and one question on Switzerland and International, please. Just on TELIS, could you confirm that it's -- the purchase is one of 100% outright? Or is there a stake left for the founding family? And then the 200 million fee income, when do you expect that to fully come into your accounts? And then lastly, I was wondering if you could give us an update on the number of financial advisers you have in the Swiss and the International business, please?

I think Marco will do the financial advisers because I said, it's a Q1 thing, and I will then say a couple of words on TELIS.

On the financial advisers in Switzerland, the number is around 500. And in International, it's on a round basis, [ 1.7 ]. And the number in Germany, I think I mentioned during the call, [ 6,145 ].

And on the TELIS transaction, we purchased 100%. So upfront, we go for the full stake. But I mentioned that the family remains involved on board, is they are there in an advisory role. But we have the full ownership of the company. But that said, they will remain on board, so to say, in an advisory position. And the 200 million fee income asset, we expect that for the full year '27 to be the first time on a full year basis included in the accounts. As said, closing of the deal is expected in the third quarter of '26. So in '26, we will see a share of that 200 million.

About 1,500 in Switzerland?

Around. Not 1,000. Around 500.

500, okay.

We have a follow-up question from Michael Huttner from Berenberg.

Most of my questions have been answered. You've been doing such a great job. But I had 2. One is -- I know you said this is a Q1 thing, but I just wondered if you can give us a feel for the trend or whatever of net new assets? And then the other one is -- so, many years ago, I think it was a 2021 Investor Day or '20, I can't remember. The -- I asked how -- why, what the success of Swiss Life is linked to because you've got all these countries and brands and stuff? And the answer then is basically you make the local CEOs come to Switzerland. And effectively, without you doing anything, I think they spend the night or the day cooped up together and then they start competing. Is that still how you do it? The -- is almost like voluntary competition between all these units? Or what drives it?

Thank you, Michael. I mean, first of all, the notion of us doing nothing is maybe not the right one, but with the -- you're absolutely right. We have this entrepreneurial spirit among the business divisions. They stand also in front of the investors, the analysts that invest, they know they have to deliver. They want to deliver anything. That's one of the drivers of our success. At the same time, we also leave them to really live their entrepreneurial spirit and their team's entrepreneurial spirit room to really pursue their ambitions. Now in terms of the NNAs, we all know this NNA figure, this may vary quarter-by-quarter. You have seen that in the past years. What I can say is that we target 170 billion in TAM by the end of 2027. And we had a really very good start into the year with the 4.2 billion. And we are on track to reach those 170 billion by the end of 2027. And we do not need to achieve 4 billion a quarter to reach that, but we're confident that we reached 170 billion.

Our last question is a follow-up from Thomas Bateman from Mediobanca.

I always listen to your confidence on the fee result target that maybe investors are a little bit more skeptical. With this deal, should I assume the new target is closer to [ CHF 1.03 billion ]? There should be an incremental step-up from this? And just the second question is on your thoughts on share buybacks in the future. Obviously, the current share buyback. It's almost ended. You've now chosen to do a deal, which I like, although the lack of disclosure on the consideration is a little bit difficult. But how should I think about share buybacks over the next 12 months given you've done this deal?

Thank you for the question. Maybe on the first one, we said the fee result will be larger than 1 billion for the financial year 2027. There's nothing to add. As I said, we mentioned full year '25 that we are well on track to reach also that target. We continue to be that and there's no let's say, additional guidance to be given. You may recall that as a matter of principle, we don't adjust targets anyway. So it's still larger than 1 billion unchanged, if you wish. In terms of how we think about share buybacks versus also in light of the deal we just have taken, the framework is well known. I think given the time, I will not walk you through the details of the framework, as I said, well known. What I may say is what I just, I think, answered in a question to Michael. We have recently issued this senior bond for general purposes, and large part of that will be used to finance the acquisition. So net-net, there will be no impact on the cash at holding vis-a-vis the level that Marco has mentioned per end of Q1. I hope that gives you some color on how we think. Good. Ladies and gentlemen, thank you very much for your questions and for joining us today. Before we close the call, let me recap. In the first 3 months of 2026, we continued on our growth path and increase the top line in both the fee and insurance businesses. We're making good progress, and we're well on track with our Swiss Life 2027 program. So thank you again, and I wish you a nice day. Goodbye.

Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.