The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Benjamin Toms - RBC Capital Markets, Research Division - Analyst
: Firstly, on costs in the Banking division. There was an increase there of about 10% year-on-year. Is the 10% growth for this year a good benchmark
for 2023 -- FY '23? And how should we think about weighing up the fact that you expect investment programs to stabilize versus wage inflation
pressure, which is presumably higher than 2022 where you only saw a 3% average increase in salaries? And then secondly, on the investment
management margin that's reduced in your asset management division with flows, including a higher proportion of lower margin products. Can
you give a bit more color on this dynamic and its competitive -- competition impacting pricing? Is there any J-curve effects with more paying
upfront and should margins see a recovery from here?
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SEPTEMBER 27, 2022 / 8:30AM, CBRO.L - Preliminary Q4 2022 Close Brothers Group PLC Earnings Call
Question: Edward Hugo Anson Firth - Keefe, Bruyette, & Woods, Inc., Research Division - Analyst
: I have two questions, if I may. The first one was just about the broader market environment in that we're seeing a lot of the big players making a
lot of money on the funding side of the balance sheet by effectively not passing on really any of the rate rises at all. And I assume that gives them
quite a competitive advantage when it comes to pricing of assets. So I guess my first question is how are you seeing the environment for pricing
of assets? Is it -- are we seeing the pass-throughs coming through? Are you able to reprice? And how confident are you that you can maintain that
competitive position at an acceptable price going forward? If that question makes sense, I hope.
Question: Edward Hugo Anson Firth - Keefe, Bruyette, & Woods, Inc., Research Division - Analyst
: Yes, I did. I did have another question. But just to be clear, so you said volume is an output, I mean, as of today, you're comfortable the momentum
of the business is still where you saw it at the end of last year.
Question: Edward Hugo Anson Firth - Keefe, Bruyette, & Woods, Inc., Research Division - Analyst
: No, no, that's great. And sorry, my second question was we've obviously seen a huge shift in interest rate expectations even just over the last 2 or
3 days. I mean do you have a sense internally how much your customers can take in terms of interest rate rises? And at what stage should we be
starting to worry about their ability to pay these higher rates?
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