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Six Strategic Intents for the Business Operation in 2012

1. We intend to provide our customers with a superior experience by offering the best service and a total financial solution to their unique needs.

2. We intend to increase our productivity and customer satisfaction through strategic investments in our people, leadership, systems and processes.

3. We intend to be the dominant market leader for Hire Purchase Business with increasing share in higher yielding

4. We intend to aggressively grow the housing loan portfolio to be the top-five in market share of the Commercial

Used and CYC segments. Banking Industry.

5. We intend to grow the Corporate and SME loan portfolios higher than industry average and gain market share.

6. We intend to increase the fee-based income proportion to be on par with industry average.

Vision of Thanachart Group To provide fully integrated financial services targeted at meeting customers’ unique financial needs by creating

the highest quality products and services which strengthen our image as a trustworthy financial services group.


Financial highlights

As at and for the year ended December 31

Consolidated 2011

2010

2009

As at and for the year ended December 31

Separate financial statements

2008

2007

2011

2010

2009

2008

Consolidated

2007

Operating results (Million Baht)

Separate financial statements

2011

2010

2009

2008

2007

96.95

90.24

83.61

87.04

92.18

2011

2010

2009

2008

2007

82.46

85.62

90.67

Asset quality

Interest income

44,214

34,781

21,470

20,688

17,488

29,547

21,397

20,934

19,897

17,123

Interest expenses

19,797

11,566

6,736

9,398

9,396

14,959

7,375

6,791

9,429

9,386

Net interest income

24,416

23,216

14,734

11,290

8,092

14,589

14,022

14,143

10,467

7,737

NPL-gross to total loans (Percent)

5.58

5.60

2.57

2.37

2.41

2.74

2.26

2.49

2.30

2.31

Non-interest income

10,595

9,457

18,403

10,700

6,111

7,172

4,000

2,815

2,286

2,005

NPL-net to total loans (Percent)

2.64

2.48

0.58

0.58

0.78

1.45

0.57

0.59

0.60

0.81

Total income(1)

35,011

32,673

33,137

21,990

14,203

21,760

18,022

16,958

12,753

9,742

Coverage ratio(7) (Percent)

69.75

71.22

96.41

94.99

92.07

71.53

97.66

92.33

88.81

86.80

21,877

16,824

24,177

15,535

9,905

13,671

8,730

9,125

7,788

6,105

Total allowance to BOT regulation

104.27

108.05

111.66

112.75

121.72

103.12

105.32

102.85

101.55

108.38

(Percent) 37,677

36,859

8,675

7,466

17,989

7,648

8,359

7,167

5,213

Non-interest expenses Bad debt and doubtful

accounts(2)

Net income(3)

2,504

2,149

3,107

3,968

2,692

1,422

1,280

2,830

3,548

2,606

7,671

8,777

4,056

1,870

1,327

6,668

5,719

3,547

1,304

991

88.86

93.37

borrowings ratio (Percent)

Non-performing loans (NPL)

5,520

(Million Baht)

Operating performance Basic earnings per share (Baht)

Loans to deposits and short-term

1.39

1.92

2.19

1.08

0.84

1.21

1.25

1.91

0.75

Capital measures

0.63

Return on average assets (ROAA) (percent)

0.89

1.23

1.06

0.56

0.47

1.13

1.31

0.96

0.41

0.36

Tier I capital ratio (Percent)

9.28

11.71

8.65

8.02

10.15

Return on average equity (ROAE) (percent)

10.61

15.52

17.01

8.79

7.47

9.42

10.70

15.20

6.22

5.52

Total capital ratio (Percent)

13.72

14.75

14.10

11.18

12.00

2.92

3.33

3.73

3.17

2.64

2.99

3.63

3.66

3.14

2.73

Risk weighted assets (Million Baht) 664,103 609,277 273,366 252,634 197,128

62.49

51.49

56.51

60.09

62.11

62.83

48.44

53.81

61.06

62.67

Interest spread(4) (Percent) Cost to income ratio net insurance premium

income(5)

Common share information

(Percent) Common shares outstanding (Million shares)

Statement of financial position (Million Baht)

- Average-basic

5,514

4,563

1,854

1,735

1,584

5,514

4,563

1,854

1,735

1,584

- End of period

5,514

5,514

1,935

1,735

1,735

5,514

5,514

1,935

1,735

1,735

13.58

13.09

14.38

12.26

12.06

Loans

635,220 606,851 285,515 276,142 228,776 616,713 326,549 282,577 272,925 224,940

Book value (Baht)

12.86

12.10

13.62

12.26

11.93

Total assets

886,060 873,203 432,970 378,347 300,787 878,053 482,063 413,878 368,272 291,098

Dividends per share (Baht)

0.40

0.56

0.56

0.43

Deposits and bill of exchange

655,206 672,475 341,496 317,243 248,193 693,991 349,753 342,664 318,760 248,084

Total liabilities

810,526 800,809 405,098 357,006 279,807 807,169 415,327 387,523 347,002 270,402 14,152

7,871

7,470

7,534

4,603

676

256

256

213

166

89

92

76

64

Shareholders’ equity(6)

74,848

72,183

27,811

21,278

20,923

70,884

66,737

26,355

21,270

20,695

Other information Employees

16,298

16,846

9,368

9,630

6,210

Branches Exchange booth

Remark: Financial Statement Appearance in accordance with the notification of the BOT Re: the

1. Interest income excludes dividend income

Definitions and

Preparation and Announcement of Financial Statements of Financial Institutions dated

2. Interest expense excludes contribution fee to Deposit Protection Agency

Formulas

28 December 2010 or Sor Nor Sor 11/2010 resulted in change various items. However,

3. Non-interest income includes fee paid related to income and insurance/life insruance expenses

the Bank and its subsidiaries have revised the financial statement for the year 2011

4. Non-interest expense excludes fee paid related to income, insurance/life insurance expense and

(exepting Y2010) for analysis and comparison

contribution fee to Deposit Protection Agency

5. Financial ratios are calculated on disclosure financial statement

2

Annual Report 2011 Thanachart Bank Public Company Limited

(1) Total

income = Net interest income + Non-interest income

(2) Including

loss on debt restructuring

(3) Excluding

minority interest/non-controlling interest

(4) Interest

spread = Yield-Cost of fund

(8)

79

Cost of fund = Interest expenses/Average paying liabilities Paying liabilities = Total deposits + interbank and money market from interest bearing + total borrowings

(5)

Cost to income ratio = Non-interest expenses/Total income

Yield = Interest income/Average earning assets

(6)

Excluding minority interest/non-controlling interest

Earning assets = Interbank and money market from interest bearing +

(7)

Total allowance/NPL

net investment + loans

(8)

Stand alone exchange booth

Annual Report 2011 Thanachart Bank Public Company Limited

3


Mr. Suphadej  Poonpipat Vice Chairman and Chairman of the Executive Committee

Message from the BOARD OF DIRECTORS

processes have been unified. We greatly appreciate the

remains uncertain with slow recovery in the USA and the debt

support of our over 4 million customers throughout this

crisis continuing to impact major European economies. Here in

process and now with over 670 branches, 2,100 ATMs and a

Thailand, flood recovery efforts are now commencing with

2011 was a year of great change and challenge for

full range of financial services; the Thanachart Bank group is

subdued economic conditions expected until at least the

Thailand and Thanachart Bank. First and foremost was the

well positioned to meet all the unique financial needs of our

second half of the year. In addition, competition remains fierce

devastating flooding which impacted the central part of

customers.

not only among the commercial banks but also from the

Dear shareholders,

Thailand, including sections of Bangkok. This unprecedented

growing presence of the government owned Special Financial

disaster caused substantial damage to agriculture,

We continue to maintain our strong position as the

Institutions. The royal decree to restructure Financial

infrastructure and productive capacity and most sadly led to

market leader in auto Hire Purchase and to show strong

Institution Development Fund (FIDF)’s debt owed to the

substantial loss of life. 2011 was also a year of political change

growth in our credit card and revolving cash card portfolios

Finance Ministry B.E. 2555, allows the Bank of Thailand to

which saw the election of a new government led by Thailand’s

with an overall loan growth of 4.7%. The increase in the Bank

impose a 0.47% fee on the deposit bases of commercial banks,

first female Prime Minister.

of Thailand’s interest rates in the first half of the year along

will be another challenge facing commercial banks. Thus, it is

with heightened competition for deposits, especially from the

important that economic policy continue to support a strong

On the economic front, the global economy continued

government-owned Special Financial Institutions, resulted in

private sector financial system and a level playing field for all

to be impacted by a weak recovery in the USA and the

a rapid increase in deposit rates and funding costs throughout

participants so that the sector can continue to foster long

European Debt Crisis, which affected tourism, exports and

the year. This combined with our market leading fixed rate Hire

term, sustainable economic development and be competitive in

investments in Asian countries, including Thailand. As for

Purchase portfolio led to a decline in Net Interest Margin over

the increasingly integrated Asean Economic Community.

Thailand, inflation concerns prompted the Bank of Thailand to

the year from 3.33 to 2.92%. Along with the one-time

move into a tightening phase and substantially increase

integration costs and impact from the floods, these factors

2011 has truly been a year of transformation for our

interest rates in the first half of the year before starting to

impacted our results such that net income declined by 12.59%

bank with the successful completion of the merger with Siam

ease rates in light of the weak global economy and the effects

from THB 8,777 to THB7,672 million in 2011.

City Bank. This was carried out in a difficult local and global

of the flood. Due to these issues, the Thai economy contracted in the fourth quarter, reducing overall GDP growth from 7.8%

environment which was closely followed by devastating

With the systems and branch conversion phase of

flooding in many parts of Thailand. Through these many challenges, our management and staff showed their enduring

development with our efforts firmly focused on growth and

dedication to helping our customers and one another overcome

The banking industry was also affected. Despite

further increasing our productivity, sales capacity and

any obstacle and reach their goals. It is this spirit and

unfavorable factors and fierce competition, the overall banking

customer satisfaction through strategic investments in our

commitment which we take this opportunity to recognize and

industry remained strong with high growth in loans and

people, leadership, technology and processes. Working with

the Board of Directors expresses our sincere appreciate to all

deposits and well-controlled non-performing loans.

Scotiabank to implement global best practices, we will

our staff for their great efforts this year and we would also like

complete the process of upgrading our sales and support

to thank all the customers, stakeholders, and shareholders as

In the past year, we focused on the integration project

infrastructure which will centralize back office processes,

well for their strong support. While challenges abound, the

with Siam City Bank (SCIB) and serving our existing

allowing our branches and call centers to focus on sales and

Board is committed to strong corporate governance and is

customers amid the high impact from the floods. This was the

customer service activities, significantly accelerating our loan

confident that our strategy under the guiding principal of

largest and most complex merger in the history of Thailand’s

approval, fulfillment and collection processes while further

Transforming to Strength and realizing Synergies and with the

financial services industry and required additional one-time

improving our loan quality. We have recruited new leadership

trust of our customers and support of our strategic partner,

costs in such areas as branches, training, systems and human

in several key business lines and support functions to support

Scotiabank, Thanachart Bank is well positioned for further

resources among others. With the strong dedication and

these initiatives and are confident these investments will

growth and prosperity.

tremendous efforts of all of our staff and key vendors and with

position the bank as a leader in customer service in the Thai

the support of our strategic partner, The Bank of Nova Scotia

financial services sector.

(Scotiabank), we completed the Entire Business Transfer of

Annual Report 2011 Thanachart Bank Public Company Limited

integration now complete, we move into the next phase of our

in 2010 to only 0.1% in 2011.

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Mr. Somjate  Moosirilert Member of the Executive Committee and Chief Executive Officer and President

all the assets of SCIB as scheduled on October 1, 2011 with

While we are excited about the future, we expect the

minimal disruption to our clients. All SCIB branches have now

environment for commercial banks in 2012 in Thailand to

Chairman of the Board of Director

been re-branded to Thanachart and all key systems and

continue to be challenging. The global economic recovery

Thanachart Bank Public Company Limited

(Mr. Banterng Tantivit)

Annual Report 2011 Thanachart Bank Public Company Limited

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Annual Report 2011 Thanachart Bank Public Company Limited

Annual Report 2011 Thanachart Bank Public Company Limited

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Annual Report 2011 Thanachart Bank Public Company Limited

Annual Report 2011 Thanachart Bank Public Company Limited

19


MANAGEMENT DISCUSSION AND ANALYSIS

Management Discussion and Analysis of Financial Position and Performance (A comparative analysis of 2011 and 2010 consolidated Consolidated Financial Statements) On April 9, 2010, TBANK successfully acquired 1,005,330,950 SCIB common shares, equivalent to 47.58 percent of SCIB’s total issued and paid up shares, from Financial Institution Development Fund (FIDF). Thereafter, it conducted tender offers to purchase the remaining shares from public shareholders in June and November 2010 at a price of THB 32.50 per share (the same price that TBANK paid to FIDF). Consequently, TBANK’s held 99.95 percent of SCIB’s total issued and paid up shares. Upon the successful share acquisition as mentioned above, therefore, the balance sheets as well as consolidated income statements of SCIB and its subsidiaries have been consolidated into TBANK’s consolidated financial statements since the date that TBANK assumed a control over SCIB. TBANK, in the first quarter of 2011, established a wholly-owned subsidiary named TS Asset Management Company Limited (TS AMC) to facilitate an efficient management of the entire non-performing assets transferred from SCIB as part of the acquisition. All of SCIB Non-Performing Loans (NPLs), Non-Performing Asset (NPA), liabilities, and obligations whether existing ones or that may arise in the future were transferred to TS AMC on October 1, 2011 at a fair price recommended by the Independent Financial Advisor at THB 50,134 million, comprising assets of THB 381,077 million and liabilities of THB 330,943 million. Since the same date, SCIB had ceased its entire business operation. Thereafter on December 6, 2011, the Extraordinary General Meeting of Shareholders of SCIB approved a change its name to “SCIB Public Company Limited.” It returned a commercial banking license to the Ministry of Finance on December 8, 2011 and had gone under the process of liquidation since December 9, 2011. To allow the minority shareholders of SCIB to sell their shares before the liquidation, in November 2011 TBANK performed a tender offer to SCIB shareholders and acquired 696,865 SCIB shares at THB 16 million, resulting in 2,112,375,422 shares held in total, equivalent to 99.98 percent stake. Meanwhile, as part of the acquisition, 437.25 million ordinary shares or 48.35 percent stake of Ratchathani Leasing Public Company Limited’s (THANI) were transferred from the SCIB to TBANK on October 1, 2011. On October 21, 2011 TBANK subscribed to THANI shares from the THANI’s right offering proportionately to its original shareholding, resulting in 874.97 million shares held. However, the remaining of THANI shareholders did not exercise all of their rights; TBANK’s shareholding, therefore, rose from 48.35 percent to 65.18 percent of the total issued and paid up shares.

TBANK consolidated financial statements included performances of the following subsidiaries. Direct subsidiaries SCIB Public Company Limited (formerly Siam City Bank Public Company Limited) Thanachart Securities Public Company Limited Thanachart Insurance Company Limited Thanachart Life Assurance Company Limited Thanachart Fund Management Company Limited Thanachart Broker Company Limited Thanachart Group Leasing Company Limited Thanachart Management and Services Company Limited

20

Annual Report 2011 Thanachart Bank Public Company Limited


Thanachart Legal and Appraisal Company Limited Thanachart Training and Development Company Limited TS Asset Management Company Limited Ratchathani Leasing Public Company Limited Indirect Subsidiaries National Leasing Company Limited Siam City Securities Company Limited (Disposed investment in August 2011) Siam City Life Assurance Company Limited Siam City Asset Management Company Limited (Disposed investment in May 2011) SCIB Service Company Limited

OVERVIEW OF OPERATING RESULTS (A comparative analysis of 2011 and 2010 Consolidated Financial Statements)

Consolidated Income Statements

2011

2010

(Unit: THB Million)

Change from 2010 Increase/ (Decrease)

Percent

Interest income

44,214

34,781

9,432

27.12

Interest expenses

19,797

11,566

8,232

71.18

Net interest income

24,416

23,216

1,201

5.18

Net fee and service income

3,358

2,850

508

17.82

Other operating incomes(1)

7,237

6,607

630

9.54

Other operating

expenses(2)

Income (loss) before impairment loss of loans and debt securities Impairment loss of loans and debt securities Income before corporate income tax

21,877

16,824

5,054

13,134

15,849

(2,715)

2,504

2,149

355

10,630

13,701

(3,071)

30.04 (17.14) 16.55 (22.42)

Corporate income tax

2,948

4,548

(1,600)

(35.19)

Net income

7,682

9,152

(1,471)

(16.07)

Attributable to controlling interests

7,671

8,777

(1,105)

(12.60)

Attributable to minority interests

10

376

(365)

(97.23)

Earnings per share (Baht) Weighted average number of ordinary shares (shares)

Notes:

(1)

Income net of insurance/life assurance expenses

(2)

Exclusive of insurance/life assurance expenses

1.39

1.92

5,513.66

4,562.52

In 2011, net income of TBANK and its subsidiaries recorded THB 7,671 million, fell by THB 1,105 million or 12.60 percent year-on-year. The key factors contributing to its performance were the following:

• Loans grew by 4.7 percent year-on-year. In particular, the hire purchase Loans grew by 19.5 percent. Despite

negative impact from the flood crisis in the 4Q2011, TBANK maintained its leading position in the automobile hire

purchase loans. The outstanding hire purchase loans stood at THB 286,361 million where it achieved a penetration

rate of new car hire purchase loans of 19.1 percent. Owing to the successful merger with SCIB, the bank loan

portfolio was well diversified. The ratio of retail loans and SME loans was at 62 percent to 38 percent.

• Deposit and B/E fell by 2.6 percent year-on-year. In 2011, TBANK altered it products and interest rates offer

to be in line with the policy interest rate as well as the market trends. The ratio of current account deposits and

savings deposits (CASA) to total deposits including B/E was 26.9.

Annual Report 2011 Thanachart Bank Public Company Limited

21


• Interest spread stood at 2.9 percent,

• Capital Adequacy: TBANK’s total capital

decreased from 3.3 percent from 2010, with the

yield on earning assets rose to 5.5 percent along

61,638 million was Tier 1 and THB 29,455 million

with the rise of market interest rate, compared to

was Tier 2. BIS ratio was 13.7 percent. The

5.1 percent of the 4Q2010 despite lower interests

capital consideration has deducted THB 15,740

recognized as flood relief programs given to

million of goodwill from acquiring SCIB shares

customers who were affected by the flood crisis in

and included THB 10,000 million subordinated

4Q2011.

Yet, the gain is expected in 1Q2012.

debentures transferred from SCIB. This was

Meanwhile, yield on loan rose slightly in 4Q2011

carried out in accordance with a waiver granted

as a result of combining Ratchthani Leasing’s

by the Bank of Thailand which stipulated such

performance. Cost of fund increased to 2.6

consideration for capital after the completion of

percent compared to 1.8 percent of 2010 as a

the entire business transfer (October 1, 2011).

result of the higher market interest rates as well as

intensifying competition.

amounted to THB 91,093 million, of which THB

Net Interest income

• Non-performing loan management. Impairment

In 2011, net interest income of TBANK and its

loss of loans and debt expense to total loan ratio

subsidiaries recorded at THB 24,416 million, reflecting an

was 0.4 percent, slightly increased from 0.3 of

increase of THB 1,201 million or 5.18 percent year-on-

2010 despite an impact from the flood crisis.

year. This was due primarily to increasing volumes of

Meanwhile, a result of TS AMC’s good performance

TBANK and SCIB transactions. Total interest income

helped improve quality of NPL, thus, lowering its

amounted to THB 44,214 million, an increase of THB 9,432

provision for NPL. As of December 31, 2011,

million or 27.12 percent while interest expenses amounted

TBANK and its subsidiaries incurred NPL of THB

to THB 19,797 million, an increase of THB 8,232 million or

37,677 million with the ratio of gross NPL to total

71.18 percent year-on-year. As a result, interest spread of

loans of 5.6 percent.

2011 stood at 2.92, a decrease from 3.32 percent of 2010.

Non-interest Income

• Growth on non-interest income which was

contributed by fees and service income, brokerage

fees, gains on proprietary trading and foreign

Non-interest income consisted of net fee and

trading transactions, gain on investment, profit

service income, net insurance/life insurance premium

sharing from investments in associated companies

income, and other operating income recorded THB 10,595

recognized under equity method, dividend income,

million, an increase of THB 1,137 million or 12.03 percent

net insurance/life insurance premium income.

year-on-year.

Net-interest income to net operating income was

30.2 percent.

Net Fees and Service Income

• The effectiveness of operating expense

TBANK and its subsidiaries recorded net fees and

management: The ratio of operating expense

service income of THB 3,358 million, representing an

to total income was 62.5 percent, increased

increase of THB 508 million or 17.82 percent year-on-year.

from 51.1 percent of 2010. This was due

Fees and service income amounted to THB 3,858 million,

primarily to thinner interest spread and integration

an increase of THB 489 million or 14.52 percent while fees

costs which included IT system improvement,

and service expenses amounted to THB 500 million, a

branch decoration cost, employee benefits and

decrease of THB 19 million or 3.60 percent due to financial

trainings, as well as cost from early retirement

product variety offered to customers both from TBANK and

program.

SCIB.

• Corporate income tax: TBANK and its subsidiaries

corporate income tax for 2011 totaled THB 2,948

Other Operating Income

million baht, or 27.7 percent, compared to 33.2

Other operating income consisted of gain on trading

percent of 2010. This was because of NPA transfer

and foreign exchange transaction, gain on investments,

to TS AMC and sales of investment in Siam City

profit sharing from investments in associated companies

Securities Co., Ltd. And the provision could be

recognized under equity method, dividend income,

recognized as tax deductible expenses.

brokerage fees, net insurance/life assurance premium

22

Annual Report 2011 Thanachart Bank Public Company Limited


income, and other income. In 2011, other operating income (net of insurance/life assurance operating expenses) of TBANK and its subsidiaries recorded THB 7,237 million, reflecting an increase of THB 630 million or 9.54 percent year-on-year.

The increase was attributable to an increase of gain on investments of THB 398 million, gain on trading and foreign exchange transaction of THB 321 million, and dividend income SCIB received from Vayupak Fund of THB 246 million while net insurance/life assurance premium income fell by THB 225 million.

Other Operating Expenses TBANK and its subsidiaries recorded other operating expenses (exclusives of insurance/life assurance expenses)

of THB 21,877 million, rose by THB 5,054 million or 30.04 percent year-on-year due primarily to personnel expenses

and integration costs. Consequently, other operating expenses to net operating income ratio (cost to income ratio) was

at 62.5 percent.

Bad Debts, Doubtful Accounts, and Allowance for Impairment In 2011, TBANK and its subsidiaries incurred expenses of bad debt, doubtful accounts, and impairment

of securities investments of THB 2,504 million, an increase of THB 355 million. Provision to total loan ratio rose

to 0.53 percent from 0.47 percent of 2010 while coverage ratio was 69.75 percent and actual/required LLR required by

the Bank of Thailand was 104.27 percent.

CONSOLIDATED FINANCIAL POSITION

Consolidated Balance Sheet

December 31, 2011

December 31, 2010

(Unit: THB Million)

Change from 2010 Increase/ (Decrease)

Percent

Assets Cash

16,006

15,298

Interbank and money market items (with interest)

63,201

85,060

Investment-net

148,345

140,022

8,323

Loans and accrued interest receivables-net

609,903

581,525

28,378

6,762

7,851

(1,089)

(13.87)

(227)

(2.53)

Property foreclosed-net

8,759

8,986

Goodwill

Land, premises and equipment-net

15,750

15,750

Other assets

17,334

18,711

886,060

873,203

Total assets

708 (21,859)

0 (1,377) 12,857

4.63 (25.70) 5.95 4.88

0.00 (7.36) 1.47

Annual Report 2011 Thanachart Bank Public Company Limited

23


As of December 31, 2010, TBANK and its subsidiaries recorded net asset of THB 886,060 million, an increase of THB 12,857 million or 1.47 percent year-on-year, due primarily to an increase of loans and accrued interest receivables of THB 28,378 million. Ratio of retail loan to corporate loan and SME loan was 62 to 38.

Consolidated Balance Sheet

December 31, 2011

December 31, 2010

(Unit: THB Million)

Change from 2010 Increase/ (Decrease)

Percent

Liabilities and shareholders’ equity Deposits Interbank and money market items (with interest)

436,040

532,656

60,151

40,545

(96,617)

(18.14)

19,606

48.36

Liability payable on demand

2,131

3,127

Debt issued and borrowings

254,297

174,949

79,348

45.36

2,824

900

1,924

213.84

36,154

29,774

6,380

21.43

Provisions Insurance and contract liabilities Other liabilities Total liabilities Equity attributable to the Bank’s shareholders Minority interest Total liabilities and shareholders’ equity

(996)

(31.86)

18,931

18,859

71

0.38

810,526

800,809

9,717

1.22

74,848

72,183

2,665

3.70

685

211

475

225.49

886,060

873,203

12,857

1.47

As of December 31, 2011, TBANK and its subsidiaries posted total liabilities of THB 810,526 million, an increase of THB 9,717 million or 1.22 percent compared to the end of 2010. An increase was attributed to the following:

• Debt instruments and borrowings of THB 254,297 million, an increase of THB 79,348 million or 45.36 percent from last year. Most of debt instruments issued by TBANK were B/E as a mean to diversify customers’ investment portfolio and provide them an investment alternative with a better yield in light of Deposit Protection Agency Act which took effect since August 2011. The products were well accepted by TBANK customers. Meanwhile, deposits dropped by THB 96,617 million or 18.14 percent compared to the end of 2010.

• Interbank and money market was THB 60,151 million, an increase of THB 19,606 million.

Shareholders’ equity of TBANK and its subsidiaries as of December 31, 2011 amounted to THB 74,848 million,

an increase of THB 2,665 million or 3.70 percent from the end of 2010, most of which came from 2011 net profit.

ASSETS QUALITY Assets as reflected in the consolidated financial statements. 1. Loans, receivables and accrued interest receivables

As of December 31, 2011, TBANK and its subsidiaries’ net loans and accrued interest receivables in accordance

with the Notifications of the BOT amounted to THB 620,328 million, an increase of THB 17,079 million or 2.83 percent from the end of last year. During 2011, the Bank and its subsidiaries entered into various debt restructuring agreements in the form of reconditioning of the debt repayment, transferring assets and/or equity and/or reconditioning the terms and conditions of repayment. The total of THB 38,685 million of debts was restructured compared to THB 17,180 million outstanding balances before the restructuring. At the end of 2011, the Bank and its subsidiaries had entered into debt restructuring agreements with 53,922 debtors out of 1,382,206 total bank’s debtors. The total outstanding balance of loans and accrued interest from restructuring was of THB 38,816 million.

24

Annual Report 2011 Thanachart Bank Public Company Limited


LOAN CONCENTRATION At the end of 2011, 45.08 percent of loan portfolio was nominated by hire purchase loans, followed by 12.90 percent of manufacturing and commerce loans, 11.59 percent of housing loans, 9.20 percent of infrastructure and service loans, 7.55 percent of real estate and construction loans, and 13.68 percent of other loans respectively. LOANS CLASSIFIED BY BUSINESS TYPE IN 2010

LOANS CLASSIFIED BY BUSINESS TYPE IN 2011

13.68% Others

12.16% Others 45.08% Hire Purchase 16.05% Manufacturing and Commerce

39.48% Hire Purchase

7.55% Real Estate and Construction 9.20% Infrastructure and Service

8.64% Real Estate and Construction 12.79% Housing

12.90% Manufacturing and Commerce

11.59% Housing

10.88% Infrastructure and Service

2. Loan classification according to the BOT’s notification

As of December 31, 2011, TBANK and its subsidiaries’ loans and accrued interest receivables classified under the

BOT’s notification registered at THB 620,328 million, an increase of THB 17,079 million or 2.83 percent from the previous year. As of December 31, 2011, it set aside allowance for doubtful accounts of THB 24,417 million and additional allowances for doubtful accounts of THB 383 million. As a result, the total allowance for doubtful accounts amounted to THB 24,800 million. The ratio of total allowance for doubtful account to loans and accrued interest receivables, therefore, stood at 4.00 percent. LOANS CLASSIFICATION ACCORDING TO THE BOT’S NOTIFICATION

(Unit: THB Million) Debt Balance/Book Value(1)

Loans and Interest Receivables

Normal

December 31, 2011 December 31, 2010

542,456

531,104

40,447 7,031

doubtful doubtful of loss

Allowance for Doubtful Accounts December 31, 2011

December 31, 2010

3,970

2,082

36,539

722

2,249

6,663

3,870

2,898

11,763

12,620

7,507

8,277

18,631

16,323

8,348

8,199

620,328

603,249

24,417

23,705

Additional allowance for doubtful accounts

383

534

Total allowance for doubtful accounts

24,800

24,239

Ratio of total allowance for doubtful accounts to total loans

4.00

4.02

Special mention substandard

Total

and interest receivables (percent) Note:

(1)

The debt balance/book value of the normal and special mention accounts did not include the accrued interest receivables.

Annual Report 2011 Thanachart Bank Public Company Limited

25


3. Non-Performing Loans (NPLs)

As of December 31, 2011, TBANK and its subsidiaries recorded an NPL in the amount of THB 37,677 million, an

increase of THB 818 million from the end of 2010, due primarily to changes of policies, strategies, and process of debt management and collections. Meanwhile, good performance of TS AMC helped improve quality of NPL transferred from SCIB. As a result, it achieved total NPL ratio of 5.58 percent.

NON-PERFORMING LOANS (Unit: THB Million) December 31, 2011

December 31, 2010

Non-performing loans (NPLs)

37,677

36,859

NPLs to total loans (percent)

5.58

5.60

17,787

16,336

2.64

2.48

NPL-net (Under the BOT’s regulation) NPL-net (percent)

NPLs CLASSIFIED BY BUSINESS TYPE

9.51% Hire Purchase Loans

11.91% Others

CLASSIFIED NPLs

18.79% Substandard

9.37% Housing Loans

14.74% Service

31.46% Doubtful 10.08% Real Estate and Construction

44.39% Manufacturing and Commerce

49.75% Doubtful of Loss

4. INVESTMENT IN SECURITIES

In 2011, TBANK and its subsidiaries’ total investments in securities stood at THB 148,345 million. Investments in

government and state enterprise securities accounted for 52.97 percent, followed by foreign debt securities, most of which were forward contracts to cover the foreign exchange risks for both foreign investments and accrued interests which accounted for 18.72 percent. After taking into consideration net revaluation surplus on investments in securities, TBANK recorded net investments in securities of THB 148,345 million in 2010, an increase from THB 139,933 million in 2010. The details of 2011 investment in securities are provided as follows:

26

Annual Report 2011 Thanachart Bank Public Company Limited


INVESTMENT IN SECURITIES CLASSIFIED BY TYPE OF INSTRUMENTS INVESTMENT CLASSIFIED BY TYPE

(Unit: THB Million) December 31, 2011

Percent

December 31, 2010

Percent

Debt securities Government and state enterprise securities • Trading securities

10,508

7.11

44

0.03

• Available-for-sale securities

40,877

27.67

52,685

37.92

• Held-to-maturity securities

26,876

18.19

36,138

26.01

4,770

3.23

21

18,389

12.45

9,898

7.12

6,592

4.46

5,874

4.23

642

0.43

3,015

2.17

25,516

17.27

12,704

1,500

1.02

5,705

Private debt securities • Trading securities • Available-for-sale securities • Held-to-maturity securities

0.02

Foreign debt securities • Trading securities • Available-for-sale securities • Held-to-maturity securities

9.14 4.11

Equity securities Listed securities • Trading securities • Available-for-sale securities

34

0.02

74

0.05

7,483

5.06

7,752

5.58

12

0.01

29

0.02

Unit trusts • Available-for-sale securities General investments Total investment in securities

4,549

3.08

4,993

147,748

100.00

138,932

Add (Less) Allowance for revaluation

641

Allowance for impairment

(44)

Total investments-net

148,345

3.59 100.00

1,098 (97) 139,933

LIQUIDITY At the end of 2011, TBANK and its subsidiaries’ cash flows received from financing activities amounted to THB 69,490 million while that of the investment activities was THB 10,216 million and cash flows used in operating activities stood at THB 78,998 million. The Bank’s cash and cash equivalents, therefore, increased by THB 708 million. At the end of 2011, the Bank’s outstanding cash and cash equivalent increased by THB 16,006 million with major items listed as follows: • Cash flows from financing activities included cash received from borrowings of THB 1,181,760 million while cash paid for borrowings was THB 1,103,304 million, cash paid for interest from borrowings was THB 6,759 million, cash paid for dividend was THB 2,205 million, and dividend paid to non-controlling interests of its subsidiaries was THB 2 million. • Cash flows from the investing activities included increase in investment in securities of THB 5,798 million, cash received from interests on investment of THB 4,534 million, cash received from dividend was of THB 824 million, and cash paid for purchase of equipment of THB 852 million. • Cash flows from operating activities included decrease of deposits in the amount of THB 96,617 million, cash received from increase of loans by THB 22,028 million, cash received from interbank and money market items of THB 23,211 million and profit from operation of THB 18,627 million respectively.

Annual Report 2011 Thanachart Bank Public Company Limited

27


(Unit: THB Million) Major Changes Iems

2011

2010

Cash flows from financing activities

69,490

91,746

Cash flows from investing activities

10,216

(35,165)

(78,998)

(45,003)

Cash flows from the operating activities Net increase (decrease) in cash Cash at beginning of the year Cash at end of the year

708

11,578

15,298

3,720

16,006

15,298

Relationship between sources and utilization of funds

In 2011, TBANK’s major sources of funds were from deposits and borrowings of THB 436,040 million and THB 254,297 million respectively. For the utilization of funds, THB 635,220 million was used for loans and THB 147,748 million was for investments respectively. The comparison between sources and utilization of funds based on maturity of financial instruments dated in balance sheet as of December 31, 2011 illustrated that the primary sources of funds were deposits with remaining maturity of less than one year which accounted for 36.19 percent of total sources of funds; followed by 31.50 percent of borrowings with remaining maturity of less than one year. On fund utilizing side, funds were used for loans with remaining maturity of more than one year which was accounted for 50.37 percent and loans with remaining maturity of less than one year accounted for 24.68 percent of total uses of funds. However, the maturity mismatch between sources and uses of funds was considered normal in commercial bank and financial institution business. This was due to the behavior of most depositors to extend their deposits after the maturity. Furthermore, the Bank had conducted risk management program that aimed at seeking for sources of funds that were most compatible with their uses through various financial instruments. This therefore enabled the TBANK to recognize in advance the signal of any adverse impacts that would occur to the sources and uses of funds. Details of key sources and uses of funds classified by maturity date of each item since the balance sheet date as of December 31, 2011 were as follows:

Type

At Call THB Million

Less Than 1 YR

Percent

THB Million

Percent

More Than 1 YR THB Million

Percent

Not Specified THB Million

Percent

Total THB Million

Percent

Sources of funds Deposits Borrowings

176,616

25.58 249,835

999 177,615

36.19

9,589

1.39

0

0.00 436,040

63.16

0.14 217,447

31.50 28,721

4.16

7,130

1.03 254,297

36.84

25.73 467,282

67.69 38,310

5.55

7,130

1.03 690,337 100.00

47,672

6.09 193,205

24.68 394,343

50.37

0

0.00 635,220

81.13

1

0.00 67,445

8.61 68,908

8.80 11,394

1.46 147,748

18.87

47,673

6.09 260,650

33.29 463,251

59.17 11,394

Total Sources of funds Uses of Funds Loans(1) Investments Total Uses of funds Note:

28

(1)

1.46 782,968 100.00

The outstanding balance of loans and debtors at call also included loans and debtors whose income recognition was put on hold

Annual Report 2011 Thanachart Bank Public Company Limited


MAINTENANCE OF CAPITAL ADEQUACY RATIO As of December 31, 2011, TBANK’s total capital registered at THB 91,093 million of which THB 61,638 million was Tier 1 capital and THB 29,455 million was Tier 2. The ratio of capital to risk weighted assets calculated under Basel II standards dropped from 14.75 percent at the end of 2010 to 13.72 percent, comprising 9.28 percent of Tier 1 capital, compared to 11.71 percent of 2010 due to goodwill expense from acquiring SCIB in the amount of THB 15,740 million and 4.44 percent of Tier 2 capital, compared to 3.04 percent of 2011 from subordinated debentures transferred from SCIB. This was carried out in accordance with a waiver granted by the Bank of Thailand which stipulated such consideration for capital after the completion of the entire business transfer (October 1, 2011). The capital ratio, however, remained well above the BOT’s minimum requirement at 8.50 percent. Details of ratio

of capital to risk weighted assets could be listed as follows:

CAPITAL ADEQUACY RATIO December 31, 2011 THB Million

December 31, 2010

Percent

THB Million

Percent

Tier 1 capital

61,638

9.28

71,335

11.71

Total capital

91,093

13.72

89,898

14.75

Thanachart Securities Public Company Limited A daily average trading value of Thanachart Securities Public Company Limited (TNS) in 2011 was THB 2,266 million,

dropped from THB 2,305 million of 2010. The market share was 4.43 percent, ranked number 10 in the industry. 77.4 percent of its trading volume was dominated by retail customers, followed by 21.0 percent of financial institutions and 1.6 percent of foreign customers respectively. For 2011, TNS recorded a net profit of THB 293 million, a decrease of THB 98 million or 25.0 percent year-on-year. Total income rose slightly by 3.7 percent year-on-year due to higher brokerage fees from derivative business which increased by THB 52 million, equivalent to 115.5 percent; interest income from margin loans increased by THB 51 million or 75.1 percent; and interest and dividend income rose by THB 35.7 million. Meanwhile, fees and service income dropped by 27.1 percent while total expense increased by 20.6 percent. TNS net liquid capital ratio stood at 149.1 percent which was substantially higher than the minimum requirement of the Securities and Exchange Commission (SEC) regulated level of 7.0 percent.

Annual Report 2011 Thanachart Bank Public Company Limited

29


Thanachart Fund Management

Company Limited

Thanachart Life Assurance Company Limited

At the end of 2011, Thanachart Fund Management

For 2011, Thanachart Life Assurance Company

Company Limited (TFUND)’s asset under management

Limited (TLIFE) recorded a net profit of THB 770 million,

recorded THB 96,351 million, an increase of THB 2,795

an increase of THB 82 million or 11.9 percent year-on-

million or 3.0 percent year-on-year.

Mutual fund asset

year. An increase was attributable to a growing customer

dropped by 1.8 percent year-on-year, yet, this was offset

base. Investment income grew by THB 202 million or 30

by an increase of provident fund and private fund asset of

percent year-on-year. Income from underwriting remained

76.7 and 4.6 percent respectively. Asset under management

the same as 2011. The capital ratio was 278 percent which

was divided into 81.3 percent of mutual fund, 9.2 percent

was well higher than the minimum requirement of the OIC

of provident fund, and the balance 9.4 percent of private

of 125 percent.

fund.

For 2011, TFND recorded a net profit of THB 89 million, a drop of THB 42 million or 32.2 percent year-on-

TS Asset Management Company Limited

year. This was due primarily to a drop of fee income in the

TS AMC Company Limited (TS AMC) was found on

amount of THB 35.97 million or 8.49 percent. However,

March 3, 2011, as part of the entire business transfer

TFUND put in place a plan to launch variety of new

project of SCIB to TBANK. NPLs and NPA were transferred

products to serve its clients’ needs in light of changing

to TS AMC in order to efficiently manage and restructure

interest rate trend and market environment.

the debts. For the year ended December 31, 2011, TS AMC

Thanachart Insurance Company Limited

recorded its total assets of THB 12,267 million and net profit of THB 180 million. THB 259 million of its income was generated from loans, THB 282 million reversals of

provision for doubtful accounts, and THB 33 million non-

For the year ended December 31, 2011, Thanachart

interest income. Allowance for impairment of property

Insurance Company Limited (TNI) recognized a net income

foreclosed was THB 12 million. Meanwhile, THB 85 million

of THB 435.88 million, achieving an increase of THB 83.74

of its expense was interest expense and THB 95 million

million or 23.8 percent year-on-year. The key factors

was operating expense.

contributing to its success included an increase of premium received through bancassurance channel and efficiency in claim management. The capital ratio at the end of 2011 was 505 percent, substantially higher than the minimum requirement of the Office of Insurance Commission (OIC) of 125 percent.

30

Annual Report 2011 Thanachart Bank Public Company Limited


NATURE OF BUSINESS OPERATIONS An Overview of the Business Operation Upon a successful integration with the SCIB and the entire business transfer of all of the SCIB’s assets on October

1, 2011, TBANK’s business structure, having TCAP as a parent company, consists of two groups: 1) financial group and

2) Supporting group. It was presently a fully integrated financial conglomerate serving customers with a full range of financial services primarily available through TBANK branch network and TBANK service outlets, and it is strongly committed to good corporate governance principles. The details of the business operations of each subsidiary company

are as follows:

Financial Group 1. Thanachart Capital Public Company Limited (TCAP) operates as the holding company being a parent company of Thanachart Financial Conglomerate. 2. Thanachart Bank Public Company Limited (TBANK) operates commercial banking business and other businesses permitted by the BOT, such as life and non-life insurance broker, a provider of services relating to unit trust and securities such as securities brokerage, proprietary trading, unit trust underwriting, mutual fund trustee service, provident fund custodian service, debt instrument underwriting and trading, securities registrar, and gold derivative trading. 3. Thanachart Securities Public Company Limited (TNS) was permitted by the Ministry of Finance and the Office of the Securities and Exchange Commission of Thailand to operate the following activities: 3.1 TNS was granted a Full-Service License to operate securities businesses and related businesses such as securities brokerage (domestically and internationally), securities underwriting, investment advisory service, securities borrowing and lending, financial advisory service, unit trust underwriting and repurchasing, and securities registrar. 3.2 TNS was granted a Derivatives Business Sor 1 License to engage in a full range of derivative businesses and related businesses such as derivative brokerage and proprietary trading. 4. Thanachart Fund Management Company Limited (TFUND), which is a joint venture between Thanachart Bank (holding 75 percent of the total shares) and The Government Savings Bank (holding 25 percent shares), operates a full range of investment management services in mutual fund management business, private fund and provident fund management business, and investment advisory business. 5. Thanachart Insurance Company Limited (TNI) operates a non-life insurance business and a disaster insurance business such as fire insurances, automobile insurances, marine and transportation insurances, miscellaneous insurance, and investment business. 6. Thanachart Life Assurance Company Limited (TLIFE) operates a life insurance business and a health insurance business individual life insurances, such as individual endowment and annuity, group life insurance, such as group life insurances for corporation and organization, and credit life insurances including hire purchase loan, mortgage, SME loan, and credit card. 7. Siam City Life Assurance Company Limited (SCILIFE) operates life insurance business by offering products through TBANK’s branch network. Its customer segment is mainly TBANK’s lending customers and deposit customers. 8. Thanachart Group Leasing Company Limited (TGL) operates a hire purchase business of all automobile types. 9. Ratchthani Leasing Public Company Limited (THANI) operates a hire purchase business and financial lease business focusing on the segment of private used cars and commercial cars such as pick-ups, taxis, tractors, and trucks. 10. NFS Asset Management Company Limited (NFS AMC) operates an asset management business by buying or receiving transfers of NPLs and NPAs from financial institutions in the Thanachart Group. 11. MAX Asset Management Company Limited (MAX AMC) operates an asset management business by buying or receiving transfers of NPLs and NPAs from other financial institutions. 12. TS Asset Management Company Limited (TS AMC) operates an asset management business by receiving transfer of NPLs and NPAs from SCIB and TBANK.

Annual Report 2011 Thanachart Bank Public Company Limited

31


Supporting Business Group 1. Thanachart Management and Services Company Limite (TMS) provides services to the Group’s service staff. 2. Thanachart Broker Company Limited (TBROKE) pursues Thanachart Group’s hire purchase customers to insure their automobiles. TBROKE is also an automobile insurance broker of TNI. 3. Thanachart Training and Development Company Limited (TTD) organizes training activities for employees of member companies of Thanachart Group. 4. Thanachart Legal and Appraisal Company Limited (TLA) provides legal advisory services, contracts, litigation, legal enforcement, and appraisal of collateral. Presently, all of its assets and employees have already been transferred to TBANK and TLA under the process of liquidation. 5. SCIB Services Company Limited (SCIB Services) provides general services to TBANK and companies in the Group, such as janitor, security, delivery, car rental, car drivers, and outsourcing service.

Chart of Shareholding Structure of Thanachart Group As of December 31, 2011

Thanachart Capital Public Company Limited

Scotia Netherlands Holding B.V.

Commercial Banking Business

Asset Management Business

48.99% 50.96%

100.00%

Thanachart Bank Public Company Limited

NFS Asset Management Company Limited

83.44%

MAX Asset Management Company Limited

Supporting Business

Financial Business 100.00% Thanachart Securities Plc. Securities Business

100.00% Thanachart Management and Services Co., Ltd.

75.00% Thanachart Fund Management Co., Ltd.

100.00%

100.00% Thanachart Insurance Co., Ltd.

100.00% Thanachart Life Assurance Co., Ltd.

Insurance Business

Thanachart Broker Co., Ltd. 100.00%

100.00%

Thanachart Training and Development Co., Ltd. 100.00%

Siam City Life Assurance Co., Ltd. 100.00% Asset Management Business

100.00%

TS Asset Management Co., Ltd.

100.00%

SCIB Services Co., Ltd.

100.00% Thanachart Group Leasing Co., Ltd.

Leasing Business

65.18% Ratchthani Leasing Plc.

Note: 1. The above shareholdings include shares held by the related parties.

32

Thanachart Legal and Appraisal Co., Ltd.

2. TLA is in the process of entering into the dissolution and liquidation.

Annual Report 2011 Thanachart Bank Public Company Limited

National Leasing Co., Ltd.


Policy on Division of Operational Functions among Member Companies of Thanachart Group Being a parent company of Thanachart Financial Conglomerate with a controlling interest (i.e. owning more than 50 percent of issued and paid-up capital), TCAP has adopted the following policies and approaches in managing the member companies of the Group as follows:

electronic services, administration and procurement, legal and appraisal services, as well as retail debt collections and collections brokerage.

Internal Control, Audit, and Corporate Governance of Parent Company and Subsidiaries Thanachart Group places strong emphasis on internal control. The Group adheres to the principle of

Business policies

adequate and appropriate internal control by establishing

procedures for business conducts, provision of services,

TCAP and TBANK are responsible for establishing

and operations. The Group also separates the duties and

annual key business policies of Thanachart Group. Each

responsibilities of each unit to allow internal examination

subsidiary is required to formulate business plans and

of each other, based on a check and balance system.

budgets for 3 - 5 years and submit them to the parent

In addition, it puts in writing the announcements as well as

company for consideration, in order to ensure that they

order mandates, rules and regulations covering key

are in alignment with the established key business policies.

business areas and operations, and this information was

The business plans and budgets are also subject to

also disclosed to all staff in such a way that they can

evaluation and review regularly. The objective is to ensure

always study them to gain a full understanding. A central

that the business plans and budgets are in line with

unit at TBANK is responsible for preparing and proposing

the changing business conditions.

the announcements, order mandates rules and regulations

Supervision of subsidiaries

of all member companies of the Group. As regard to the internal audit, the internal audit

The directors and high-ranking executives of TCAP

group is responsible for auditing the business operations of

and TBANK are assigned to be the members of the Board

all member companies of the Group, ensuring that they

of Directors of the subsidiaries. The arrangement not only

comply with the regulations and the established work

enables TCAP and TBANK to assist the subsidiaries in

systems. The internal audit group also assesses an

establishing their policies and in determining their future

adequacy and effectiveness of an internal control system in

direction, but also ensures the close supervision of the

operations to ensure the use of resources and properties

subsidiaries’ business operations. Importantly, the Chief

and prevention or reduction of errors, damages in order to

Executive Officers of the subsidiaries are required to

propose corrective measures for improvement. In addition,

present a monthly performance report to the Executive

the Thanachart Group has established a Compliance Unit

Committee and the matters in the Executive Committee

responsible for closely monitoring changes of laws,

Meeting are then reported to the Board of Directors of

notifications, and orders related to the Group’s business

TBANK.

affairs and operations and disseminating the information to

the staff. The Compliance Unit is also responsible for

Centralizing of support services

ensuring that the conduct of business affairs of the

member companies of the Group is in compliance with the

It is a policy of the Thanachart Group to centralize

legal requirements.

specific functions of the support services into one company which, then, is responsible for providing such services

Moreover, the Audit Committee of each member

to all other member companies of the Group. The purpose

company of the Group is responsible for governing,

is to maximize benefits within the existing resources

controlling, and auditing their respective business

including expertise of operations staff and various

operations. The Audit Committee is also allowed to carry

information technologies, and to reduce staffing costs. The

out its duties and give its opinions in an independent

centralized support services available now within

manner of the management of each company. The purpose

Thanachart Group included information technology, human

is to ensure that internal control and audit systems are

resource, systems and internal regulatory development,

effective and that the financial statements are properly

internal audit, operation control, business control,

reviewed.

Annual Report 2011 Thanachart Bank Public Company Limited

33


As regard to the corporate governance, the Boards of Directors of TCAP and the companies in the Group place a strong emphasis on the good corporate governance both at the level of the Boards of Directors and the level of various Committees. Independent directors are appointed to the Boards of Directors and the Committees to provide effective checks and balances on the powers of executive directors. The established scope of responsibilities of the Boards of Directors and the Committees are also in line with the principles of good corporate governance. In addition, the Boards of Directors of the TCAP and the subsidiaries have established the corporate governance policy and the code of conduct which the directors, executives, and staff of the member companies of Thanachart Group are required to adhere to. Focus is

given to integrity, transparency, and avoidance of any conflict of interest.

Risk management TCAP ensured that the member companies of the Group analyze and assess various risks of their business operations and that the risks are properly managed in line with the guidelines given by the authorities. In addition, TCAP conducts an analysis of the key risks faced by the member companies of the Group which may need direct financial or management support from TCAP. The established risk management policy of the Thanachart Financial Conglomerate is in line with the guidelines given by the BOT.

Income structures of TBANK and its subsidiaries Income structures of TBANK and its subsidiaries based on the consolidated financial statements as of December

31, 2011, 2010 and 2009 are as follows;

A table of income structures of TBANK and its subsidiaries (the consolidated financial statements) Percentage of share held (inclusive of related parties)

Interest and dividend income Thanachart Bank Plc. Siam City Bank Plc. Thanachart Securities Plc. Thanachart Fund Management Co., Ltd.

2011 THB Million

2010

Percent

THB Million

2009

Percent

THB Million

Percent

29,351

63.48

21,318

50.73

20,282

61.21

99.98

12,996

28.11

12,186

29.00

-

-

100.00

121

0.26

76

0.18

104

0.31

75.00

5

0.01

2

0.01

2

-

Thanachart Insurance Co., Ltd.

100.00

93

0.20

56

0.13

68

0.21

Thanachart Life Assurance Co., Ltd.

100.00

710

1.54

589

1.40

384

1.16

Thanachart Group Leasing Co., Ltd.

100.00

112

0.24

206

0.49

356

1.07

65.18

175

0.38

-

-

-

-

TS Asset Management Co., Ltd.

100.00

264

0.57

-

-

-

-

Thanachart Broker Co., Ltd.

100.00

1

-

1

-

-

-

Thanachart Management and Services Co., Ltd.

100.00

-

-

-

-

-

-

Thanachart Law and Appraisal Co., Ltd.

100.00

-

-

-

-

-

-

Thanachart Training and Development Co., Ltd.

100.00

-

-

-

-

-

-

-

-

-

86

0.20

271

0.82

100.00

2

-

3

0.01

3

0.01

-

-

-

25

0.06

-

-

100.00

382

0.83

228

0.54

-

-

-

2

-

5

0.01

-

-

100.00

-

-

-

-

-

-

44,214 95.62

34,781

82.76

21,470

64.79

Ratchthani Leasing Plc.

T Leasing Co., Ltd. National Leasing Co., Ltd. Siam City Securities Co., Ltd. Siam City Life Assurance Co., Ltd. Siam City Asset Management Co., Ltd. SCIB Services Co., Ltd. Total interest and dividend income

34

Consolidated financial statements

Annual Report 2011 Thanachart Bank Public Company Limited


A table of income structures of TBANK and its subsidiaries (the consolidated financial statements) (Cont’) Percentage of share held (inclusive of related parties)

Interest Expense Thanachart Bank Plc.

Consolidated financial statements 2011 THB Million

2010

Percent

THB Million

2009

Percent

THB Million

Percent

14,298

30.92

7,329

17.44

6,734

20.33

99.98

5,475

11.84

4,233

10.08

-

-

100.00

5

0.01

2

-

1

-

75.00

-

-

-

-

-

-

Thanachart Insurance Co., Ltd.

100.00

-

-

-

-

-

-

Thanachart Life Assurance Co., Ltd.

100.00

-

-

-

-

-

-

Thanachart Group Leasing Co., Ltd.

100.00

-

-

-

-

-

-

65.18

20

0.04

-

-

-

-

TS Asset Management Co., Ltd.

100.00

-

-

-

-

-

-

Thanachart Broker Co., Ltd.

100.00

-

-

-

-

-

-

Thanachart Management and Services Co., Ltd.

100.00

-

-

-

-

-

-

Thanachart Law and Appraisal Co., Ltd.

100.00

-

-

-

-

-

-

Thanachart Training and Development Co., Ltd.

100.00

-

-

-

-

-

-

-

-

-

-

-

-

-

100.00

-

-

-

-

1

-

-

-

-

2

-

-

-

100.00

-

-

-

-

-

-

-

-

-

-

-

-

-

100.00

-

-

-

-

-

-

Total interest expense

19,798 42.81

11,566

27.52

6,736

20.33

Net interest and dividend income

24,416 52.81

23,215

55.24

14,734

44.46

Non-interest income

4,703

10.17

2,715

6.46

2,393

7.22

99.98

1,681

3.63

2,296

5.46

-

-

100.00

1,267

2.74

1,302

3.10

1,027

3.10 1.32

Siam City Bank Plc. Thanachart Securities Plc. Thanachart Fund Management Co., Ltd.

Ratchthani Leasing Plc.

T Leasing Co., Ltd. National Leasing Co., Ltd. Siam City Securities Co., Ltd. Siam City Life Assurance Co., Ltd. Siam City Asset Management Co., Ltd. SCIB Services Co., Ltd.

Thanachart Bank Plc. Siam City Bank Plc. Thanachart Securities Plc.

75.00

444

0.96

479

1.14

437

Thanachart Insurance Co., Ltd.

100.00

3,938

8.52

3,085

7.34

2,672

8.07

Thanachart Life Assurance Co., Ltd.

100.00

7,205

15.58

5,828

13.87

11,637

35.12

Thanachart Group Leasing Co., Ltd.

100.00

65

0.14

83

0.20

96

0.29

65.18

22

0.05

-

-

-

-

TS Asset Management Co., Ltd.

100.00

32

0.07

-

-

-

-

Thanachart Broker Co., Ltd.

100.00

60

0.13

56

0.13

57

0.17

Thanachart Management and Services Co., Ltd.

100.00

1

-

1

-

1

-

Thanachart Law and Appraisal Co., Ltd.

100.00

-

-

14

0.03

43

0.13

Thanachart Training and Development Co., Ltd.

100.00

-

-

-

-

-

-

-

-

-

11

0.03

37

0.11

Thanachart Fund Management Co., Ltd.

Ratchthani Leasing Plc.

T Leasing Co., Ltd. National Leasing Co., Ltd. Siam City Securities Co., Ltd. Siam City Life Assurance Co., Ltd. Siam City Asset Management Co., Ltd. SCIB Services Co., Ltd. Total non-interest income

100.00

-

-

1

-

3

0.01

-

110

0.24

235

0.56

-

-

100.00

2,255

4.88

2,637

6.28

-

-

-

32

0.07

65

0.15

-

-

100.00

5

0.01

2

0.01

-

-

21,820 47.19

18,810

44.76

18,403

55.54

46,236 100.0

42,025

100.0

33,137

100.0

Total interest and dividend income and non-interest income

Annual Report 2011 Thanachart Bank Public Company Limited

35


Income structures of TBANK based on separated financial statements for the year ended December 31, 2011, 2010 and 2009 were as follows;

A table of income structures of TBANK (the separated financial statements) The separated financial statement 2011 THB Million

2010

Percent

2009

THB Million

Percent

THB Million

Percent

Interest and dividend income

29,548 134.97

21,397

118.27

20,421

128.55

Interest expenses

14,959

68.33

7,375

40.77

7,863

49.50

Net interest and dividend income

14,589

66.64

14,022

77.50

12,558

79.05

Non-interest income

7,304

33.36

4,070

22.50

3,328

20.95

100.0 15,886

100.0

Total interest and dividend income and non-interest income

21,893

100.0 18,092

Nature of Business Operation of Each Business Group

Business Policy and Strategies of Thanachart Group In 2011, Thanachart Group has determined its strategic direction to become a fully integrated financial services group capable of offering a full range of quality products and services that cater to the financial needs of the customers in an efficient manner. To achieve this goal, Thanachart Group has set up its vision “Becoming a fully integrated financial services group; aiming at creating an excellence in our services and product development, so as to satisfy our customers’ financial needs, with the cooperation and unity of all the members of the Group.” Such vision was developed from three major fundamentals which are providing fully integrated financial services (Universal Banking) with TBANK being the main services offering; focusing on satisfying of our customers’ different needs (Customer Centric); and cooperating from all departments wholeheartedly to provide excellent service to customers (Synergy). The endeavor and accomplishment from the three major fundamentals not only allowed Thanachart Group to be

a fully integrated financial services group with highly successful in competition, but also is a key to drive Thanachart Group to become one of Thailand’s leading banks over the next three to five years. From our goal to become a fully integrated financial services group, Thanachart Group aims to become one of Thailand’s top five leading banks in the commercial banking industry. A result from merging with SCIB allows Thanachart Group to possess an asset size appropriate for business competition and gain an ability to diversify risks by expanding corporate loans to small-sized and medium-sized enterprises so as to provide varieties of alternatives to customers. Moreover, synergy of Customer Experience Management and Sale and Service Model system from Scotiabank enables Thanachart Group to offer a superior experience by providing the best services to fully satisfy financial needs of our customers as well as creating financial performance at the level equivalent to that of Commercial Bank industry’s average. Besides that, Thanachart Group also puts an emphasis on diversification of income sources in order to balancing interest income and fee-based income, by focusing more on fee-based transactions and cross-selling transactions. These aims have been communicated to all of our staff. In 2011, the Thanachart Group has set six Strategic Intents as follows:

36

Annual Report 2011 Thanachart Bank Public Company Limited


1. We intended to provide our customers with a superior experience by offering the best service and a total financial solution to their unique needs. 2. We intended to be the dominant market leader for Hire Purchase Business. 3. We intended to aggressively grow the housing loan portfolio to be the top-three in market share of the Commercial Banking Industry. 4. We intended to grow the loan portfolio (corporate and SME) higher than industry average. 5. We intended to increase the fee-based income proportion to be on par with industrial average. 6. We intended to enhance our services and support productivity with cost effectiveness. The above six Strategic Intents were communicated to all staffs at all levels so that they all shared a mutual objectives consistent with visions and strategic objectives of the Thanachart Group. In order that the strategies were in alignment, efficiently evaluated and able to manage the organization systematically, Thanachart Group has developed

a plan namely “CEO’s Six-Point Agenda” which served as a tool to enhance the set target to be efficient and systematic success.

Business Operations of Each Business Group Commercial Banking Business Characteristics of Products and Services

TBANK operated its businesses in compliance with the Financial Institutions Business Act and other relevant notifications issued by the Bank of Thailand (BOT). It acts as a non-life and life insurance brokerage agent, an advisor and investment unit distributor for mutual funds, trustee services for mutual funds, custodian services for private funds, securities brokerage, securities trading, debt instrument trading, securities registrar, and a selling agent for gold derivatives. As of December 31, 2011, TBANK had a total of 676 branches (excluding the headquarters or Tonson branch), 2,151 ATMs (Automatic Teller Machines), 57 CDMs (Cash Deposit Machines), 135 Passbook Update Machines, and 79 foreign exchange booths (35 in-branches, 43 stand-alone and 1 mobile car).

Group of Products and Services TBANK improves and developes products to better serve various needs of our customers. Its four main products and services were as follows: Products and Services

Group 1 Deposit Products

Characteristics

Deposit products are offered to customers, both individuals and corporates. There are 4 major types of deposit products which

are saving deposit, fixed deposit, current deposit and foreign currency deposit.

Competitive Strategies

In 2011, the merger of TBANK and SCIB had been scheduled to complete by October 1, 2011. Therefore databases of the customers and deposits of both TBANK and SCIB must be combined into one

to serve customer’s need perfectly after the merger. To do so, all resources were used to develop information systems and other necessary systems to be able to complete the merger within the timeline. Because of that, TBANK did not focus its effort on launching any new product to the market. Moreover with the rising trend of interest rate, TBANK changed strategy by: 1. Emphasizing on expanding customer base to both small-sized and medium-sized. 2. Expanding customer base especially on saving deposit and current deposit by launching new saving deposit product “Corporate Saving Plus” to broaden customer base. Owing to the success of the merger, TBANK can successfully

serve more than three million customers of both TBANK and SCIB through our 676 branches nationwide without any interruption.

Annual Report 2011 Thanachart Bank Public Company Limited

37


Products and Services

Characteristics

Group 2 Lending

Competitive Strategies

1. Personal Loans, consist of:

Products

TBANK placed emphasis on efficient service delivery and fully integrated products that fulfill to all customer needs. As well,

Home loans under

marketing promotion, which is in line with the situation and

the brand of “TBANK Home

competitive condition, is highlighted. The Retail Banking Department is

Loan”, Multi-purposed loans

responsible for developing products, terms and conditions, as well as

named “Home Cash” and

interest rates charged. The target customers are divided into four

“Mortgage Cash”, Education

groups, i.e. customers who needed home loans, customers who needed

Loans called “Scholar Loan”,

personal loans with houses as collateral, hire purchase customers with

Wish-list loans which are

good repayment records and customers who need to study further in

credit lines given to the

a higher level of education. The main distribution channel is personal

hire purchase customers

sales and marketing teams that are responsible for the sales target set

with good repayment records,

in the business plan. Moreover, branches are channels to advertise

new products of Credit

personal loans or new products to the customers.

Card under the name of

Thanachart “Drive Visa/

Master Card” given to the

hire purchase customers

with

repayment

records and the depositors.

good

2. Automobile SMEs

TBANK places emphasis on lending to car related entrepreneurs.

TBANK offeres this

The plan is set together between the Product Development team and

product to car related

Marketing team. Focus is given to a selection of the target customers,

entrepreneurs who have

with whom TBANK has their database and good relationships. Also,

short-term financial needs

TBANK continues placing an emphasis on promoting good relationships

with the proceeds of the

with its customers by providing the customers with advices on financial

loans to be used as their

and business planning. This is for maintaining the TBANK’s existing

working capital or for

customers. TBANK continues developing loan products that in

enhancing their liquidity

corporate other financial services, ensuring that the customers have

position as well as those

the credit line and products that matched their financial needs as

who have long-term financial

well as the financial structure that were appropriate to their business

needs with the proceeds of

operations. Loan approval authority was delegated by making use

the loans to be used for

of the credit scoring techniques as a main tool for screening and

business

or

approving applications for standard loan products. The main

reducing funding cost.

expansion

distribution channels were in Bangkok and its vicinity and in the

These included guarantee/

upcountry.

avals and trade finance.

38

Annual Report 2011 Thanachart Bank Public Company Limited


Products and Services

Characteristics

Competitive Strategies

3. Corporate Loans

In 2011, TBANK concentrates on maintaining its existing customer

In 2011, TBANK

base for SME customers by launching products for those with good

classifies its corporate

repayment records and also allowing loosen schemes for customers

finance customers into two

who are affected by flooding crisis. For corporate loan customers,

major groups as follows;

TBANK places an emphasis on lending programs that match their

1.)Large scale businesses

financial needs. Apart from the products, TBANK places an emphasis

which are those of annual

on improving work processes in order to be more efficient, yet flexible

sales revenue of over THB

while having a proper Internal control and a proper risk management

600 million; and 2.) Small-

system.

sized and Medium-sized

enterprises (SMEs) which

include

of

customers with annual

sales revenue of less than

THB 600 million.

the

group

4. Automobile Hire Purchase Loans

TBANK’s hire purchase loan services are provided across the country through car dealers and TBANK’s branches. In setting the

TBANK give hire

policy to offer a price, the Bank considers external factors such as

purchase loans for new and

a competition in the market and internal factors such as cost of fund

used cars. The Bank also

and loan risk. In addition, TBANK places an emphasis on sales

offeres sale and lease back

promotion activities with car dealers in each region, aiming to offer

services under the product

high purchase loan conditions that meet the need of regional dealers

named “Cash Your Car”.

and customers the most, as well as establishing relationships with the

This product is in response

automobile manufacturers in order to gain a larger market share of the

to hire purchase customers

automobile hire purchase business and promote the image of a leading

who need cash, with a

loan provider of automobile hire purchase. TBANK increases

selling point of higher

distribution channels, providing customer’s convenience by offering the

credit line than a personal

“Cash Your Car” product through TBANK branches.

loan, lower interest rate and

longer

period

of

installment payment than a personal loan. Customers are able to choose the period of payment and installment plan at the most suitable for them.

Annual Report 2011 Thanachart Bank Public Company Limited

39


Products and Services

Characteristics

Competitive Strategies

5. Trade Finance

The main factors that promote trade finance services to

TBANK provides a

customers are accuracy in services, convenience, competitive interest

full range of trade finance

rate and fees. The Bank took into consideration the customers’ needs

products

services

and the promotion of business transactions as the main concerns. For

including Import Letter of

the corporate clients, the Bank has the target to expand customer base

Credit (L/C), Trust Receipt,

to large scale businesses and SMEs. The Bank provides trade finance

Collection Agency of D/P

credit limit, liquidity supports, and specialist advices on trade finance

and D/A for oversea buyers,

documents for customers. TBANK also developes trade finance

Packing Credit, Export Bills

products and services to cater to customer needs. The global business

Purchased/ Discounted,

alliance network is useful for fast and convenience service which

Export Bills for Collection,

provides customers’ satisfactory on the Bank’s products and services.

and

Letter of Guarantee, Stand-

by L/C, and Oversea Money

Transfer.

6. Personal Loans TBANK

Products under unsecured personal loans defined competitive

provides

strategies on product development, marketing campaign, distribution

many types of unsecured

channel, and appropriate services to serve target customers’ needs.

personal

be

Thus TBANK provides a variety of products for customers to choose

accessible and responsive

appropriately by life stage and life style, These products have been

to cover a wide range of

designed in such a way that are easily understandable and practical

customer needs, therefore

for every day needs.

loans.

To

the purpose of loans may

or may not be specified.

Main competitive strategies of each product

TBANK’s personal loans

1. Personal Loan

are

serves

under

the

product names as follows:

- T-Loan

T-Loan

2. Revolving Credit Card is

a

Providing cardholders with a credit line to spend for any

multi-purpose loan providing

purposes. Customers can withdraw cash within a credit line as per

for general customers. The

their needs at ATM worldwide.

repayments are arranged in

3. Credit Card

equal installment monthly

and specified time.

needs for every purchase.

Wish-List loan

is an additional credit

line of loan provided to TBANK’s hire purchase customers who have good repayment record. - Special

for

Corporate Staff TBANK provides this loan specifically to customers whose companies have

a

campaign

Emphasizing on everyday needs of cardholders with simplified

and practical use of he card. Cardholders received benefits as per their

- Wish-List loan

with

TBANK

40

Providing a variety of product to carter to customer needs in

each group that fit their purposes.

Annual Report 2011 Thanachart Bank Public Company Limited


Products and Services

Characteristics

Competitive Strategies

- Scholar Loan

Scholar loan is

a loan for payment of tuition or any expenses for obtaining a master ’s or doctorate degree. - P e n s i o n

Secured Loan This is a special multi-purpose loan for government

employees

who receive monthly pension payment from the Comptroller

G e n e r a l ’s

Department. 7. FLASH Card is a product

that

provides

cardholders with enhanced flexibility as it serves as a source

of

a

revolving

credit. FLASH Card places an emphasis on fast and convenience service which enables the cardholders to withdraw cash from ATMs worldwide. FLASH Card also allows the cardholders to pay the minimum amount in each collection period. 8. Credit Card Services This product provides the line of credit to purchase products/services as cash or allows cardholders to withdraw cash. TBANK, collaborates with VISA and MASTERCARD to provide credit card in multiple types suitable

to

customers’

qualifications and needs under the following names:

Annual Report 2011 Thanachart Bank Public Company Limited

41


Products and Services

Characteristics

Competitive Strategies

- T h a n a c h a t

“Drive” Credit Card :

For customers

who needed a credit card

with cash back for every

payment made at any gas

stations.

- T h a n a c h a t

Platinum Credit Card :

For customers

who are looking for exclusive

services

privilege

benefits in a view of luxury

and convenience.

and

Group 3

TBANK offers electronic

The strategy focuses on cross-selling and up-selling via bank

Electronic

products and services that

branches to both small and large scale companies. For individual

Products

enabled customers to make

customers who needed convenient transaction and safety for money

and Services

financial transactions at a

transfer, TBANK initiates the promotion campaign aiming at easy

better efficient manner.

accessibility and services. The money can be received on the same day

These services included

of a transfer. Branches have been available in shopping centers or

fund transfer, Automatic

nearby office areas for customers’ convenience.

Transfer Service (ATS),

online

In 2011, TBANK offered services as follows:

financial transactions through

1. Internet Banking Service. This service was for both individual

the Bank of Thailand’s

and corporate customers in order to broaden channels for customers to

Automatic High-Volume

facilitate their financial transactions.

Tr a n s a c t i o n

(BAHTNET),

settlement

for

Network

2. Financial Transaction Notification via SMS service. This 24-hour

automatic

service notified all transactions i.e. deposit, withdrawal and money

money transfers between

transfer via SMS to the customers’ mobile phone number registered

banks

with the Bank.

System),

Payment

3. An exclusive Cash Back Debit Card. The value of this service

service for goods and

was that customers receive cash back directly into their accounts for

services and a debit card.

every spending. The EMV technology provided an ultimate security to

To meet the customer

protect a card from data stealing.

needs, the Bank has also

developed

system through the Internet,

which are as follows:

-

(Bulk Bill

the

Payment

service

Thanachart i-Net

service -

Thanachart SMS

Alert service -

Cash Back Debit

Card

42

Annual Report 2011 Thanachart Bank Public Company Limited


Products and Services

Group 4 Other Products

Characteristics

Competitive Strategies

1. Foreign Exchange Services

TBANK has expanded its branch network and currency exchange booths to serve all business sectors and tourists nationwide. TBANK

TBANK’s services

also adjusts exchange rates by benchmarking with the movements of

include foreign exchange

the world’s currency market. As a result, its customers receives real

services in forms of; bank

time rates and fair prices.

traveler ’s

cheques, money changers,

forward foreign exchange

for international business

transaction, inward and

outward foreign currency

transfers for goods and

services, transfer for

personal accounts, account

opening for Foreign Currency

Deposit (FCD), etc.

notes

and

2. Bill of Exchange (B/E)

TBANK has developed B/E service to be safer and more convenient to enhance customers’ confidence by using a B/E passbook

TBANK has expanded its bill of exchange services

that allow customers to review transaction lists and outstanding of investments in each bills of exchange.

to every branch nationwide resulting in more convenient

TBANK also facilitates its customers by transferring payments of

accessibility to customers.

principal and interest when the B/E reaches its maturity or transferring

The product is well accepted

a payment of interest of each period automatically to the customers’

by the customers.

saving accounts or current accounts as stated in each purchase order.

Target customers are those depositors both individuals and corporates

who have financial literacy and experience in investing in debt

instruments and are able to accept a certain level of the Bank’s credit

risk.

3. Securities Business Support Services

Besides acquiring Foreign Sub Custodian license from the SEC in order to serve Thai Funds which invest overseas, in 2011, TBANK

TBANK’s securities

applied and was granted a Registrar license from the SEC to support

business support services

customers transferred from SCIB and to fully offer all range of services

are, for example, Custodian,

to meet customer needs. TBANK continues to develop business by

Trustee, Fund Supervisor and

utilizing the Bank’s network along with providing securities business

Bondholder Representative.

support services to support the financial management of investment funds.

Annual Report 2011 Thanachart Bank Public Company Limited

43


Influential Factors of Constraints on Business Operation

3) Strengthen

financial

infrastructure,

by

enhancing the capability and tools for risk management,

improving the information system for risk management,

The economic outlook for the first nine months of

reviewing the financial laws that support risk management,

2011 was likely to expand moderately, although it was

strengthen the information technology (IT) infrastructure

slow down in the second quarter as the production sector

and capacity, and enhancing the capacity of human

faced supply disruption problems following Tsunami

resources.

disaster in Japan. In addition, exports of goods and

services in Asian Region was decelerated due to

After the Bank of Thailand (BOT) has launched new

uncertainty growth of the global economy in the last

policies encouraging Thai commercial banks to gain

quarter of the year, resulting from real estate problems,

strength from 2010 to 2011, the year of 2012 would be the

unemployment problem in the U.S., and the European

phase of promoting competition. Accordingly, BOT has

sovereign debt crisis. Besides, Thailand faced the

granted permission for foreign bank branches to open two

widespread floods’ impact across the country, especially in

additional branches and allowed any existing foreign bank

the central region such as Ayutthaya and Patum Thani

branches in Thailand to step up as a subsidiary that could

provinces, in which seven industrial estates were located.

have a maximum of 20 branches and 20 off-premise ATMs.

The total damages were amounted to THB 1,300,000

Thai commercial banks, therefore, need to improve their

million approximately. These circumstances affected all

capability to withstand their market share and compete in

sectors, especially productions and exports of hard disk

the system.

drive, automobile, electronic bulbs and parts, and electric appliances.

Industry Condition and Competition

Consequently, the economic growth in the fourth

At the end of 2011, the total number of commercial

quarter was dramatically contracted compared to the

banks in industry registered at 31, of which 16 were

previous year, and was forecasted to grow at an annualized

domestically registered banks, and 15 were foreign bank’s

rate of 1.8 to 2.0 percent approximately. The expenditure

branches.

of the government’s investment budget was reduced

as the capital expenditure disbursement under the Thai

The outstanding amount of deposits in the

Khem Khang: TKK 2012 program was declined. However,

commercial banking industry at the end of 2011 stood at

private sector investment remained sound.

THB 7,990,823 million, of which THB 7,367,485 million or

92.2 percent of total deposits were at the domestically

Apart from economic factors, the commercial banks

registered banks, and THB 623,338 million or 7.8 percent

needed to divert to ensure that they are properly prepared

of total deposits were at foreign bank’s branches. The total

for entering the ASEAN Economic Community (AEC)’s 2015

deposits of domestic banks increased 6.69 percent from

Financial Sector Master Plan Phase II, implementing

the same period of the last year.

process between 2010 – 2014. This circumstance had

drawn plenty of attention and awareness from commercial

In terms of net loans of the commercial banking

banks during the past years. The Financial Sector Master

industry, the total amount was THB 9,782,193 million.

Plan phase II’s main policies could be categorized into

From the total net loans of industry, of which THB

three key pillars:

8,732,797 or 89.27 percent of total net loans came from

1) Reduce system-wide operating costs, including

domestic banks and THB 1,049,396 or 10.73 of total net

regulatory costs and costs of legacy non-performing

loans came from foreign bank’s branches. Comparing to

assets, in order to enhance the efficiency of financial

the previous year, the total net loans increased 11.63

institutions system.

percent due to a real growth of an economic sector of the

2) Promote competition and financial access by increasing of new service providers, as well as expanding business scope of existing service providers. This will

country. Besides the competition within the commercial

help induce competition in price and service quality, as well

banking industry, commercial banks also faced with other

as the opportunity for boarder financial access. Accordingly

competitions from non-bank institutions such as non-

the efficiency of overall economy will increase.

banks, financial and capital market, as well as the

44

Annual Report 2011 Thanachart Bank Public Company Limited


government’s specialized banks, resulted from changes in

leadership of hire purchase industry, TBANK purchased and

the regulators’ rules and regulations. The changes allowed

held 65.81 percent of Ratchathani Leasing’s shares.

for more flexibility and prepared the industry for the

Ratchthani Leasing has a strong emphasis on commercial

financial liberalization in the future. The increase of

cars (trucks and taxi), second-hand cars, and large-sized

competitions has caused the commercial banks to increase

motorcycles (Big Bikes).

competitive advantages by developing differentiations, called non-price strategies. The strategies are as follow: developing a more diverse range of financial products to

Trends in Competition

meet the needs of specified customers (Customer

According to economic forecasts from domestic and

Segmentation), increasing more distribution channels to

international research houses and financial institutions,

cover potential customers across the nation such as

economic indicators signaled an improvement. In 2012,

increasing of branches in department stores, ATM booths,

the Thai economy is expected to grow at 4.5 to 5.5 percent

Electronic corner (ATM + CDM + UDP), etc., improving

from the previous year, driven mostly by economic

quality of service by using Customer Experience

restoration after the flood in 2011 which is expected to

Management, making a good impression on customers by

begin in the first quarter of 2012, as well as government

using Customer Data Analysis in order to offer suitable

stimulus policies employing various measures such as a

products and services that meet the customers’ needs, and

rice pledging scheme, increase in the minimum wage and

establishing business alliances and merger in the financial

corporate income tax reductions, and a low base of 2011

industry. The objectives are to provide customers with

economic figures. Yet, the weak of global economy

greater convenience and to cater to customers’ all financial

continues to be a major factor that could undermine Thai

needs. Moreover, the commercial banks placed a strong

economy and must be closely watched. As for the economy

emphasis on creating a corporate image through

of the United States, although the unemployment rate

advertising media, public relations, and an establishment

declined in the fourth quarter of 2011 yet it remained high,

of a greater corporate social responsibility. In addition to a

the real estate sector has not yet recovered, while public

competition in interest rate, non-price strategy would help

debts stood at high level. Meanwhile, the debts crisis in

commercial banks substantially to differentiate their

Europe, especially in Greece was ongoing and began to

competitive positioning leading to competitive advantages

spread into the financial sector of the Eurozone while no

in the future.

solid solution has been reached. These may be the key

factors to cause Thailand’s exports in 2012 to slow down.

Regarding the interest rate trend, the most recent

Nonetheless, the inflation rate in 2012 is estimated to be

meeting of the Monetary Policy Committee (MPC) on

similar to the previous year. The 2012 headline inflation is

November 30, 2011 presented a resolution to decrease

expected to be at 3.2 percent, caused by rising fuel prices

policy interest rate by 0.25 percent (from 3.50 percent to

and lower demand for commodities as a result of the

3.25 percent), which was the first reduction of policy

global market downturn while domestic production costs

interest rate of the year (since the beginning of the year

grow higher than minimum wage, higher transportation

2011, interest rate policy has been continuously risen, by

costs from levy to oil fund, and higher rice price from rice

1.50 percent). The causes were an increasing risk of

pledging scheme. Due to the continuous increase of the

the global economy downturn and the remaining weak

policy interest rate to 1.50 percent in 2011, it is therefore

confidence of private sector from the floods’ impact of 2011.

estimated that in 2012 BOT will adjust the policy interest

The Company’s Size Compared to Competitors In 2011, TBANK had accomplished in merger with

rate slightly. As BOT has promoted competition under the 2nd Phase of development plan which prepared for entering

Siam City Bank on October 1, 2011, allowing TBANK to

the AEC, it prompted Thai commercial banks to be more

enhance its potential and competitive edge. Presently,

enthusiastic and more competitive. The competition trend

TBANK have 676 branches in total. It had THB 886,060

in the Thai commercial banking industry in 2012 will be a

million in its total assets, increased by THB 12,857 million

service development under the Customer Centricity

from the previous year or 1.47 percent. The Bank’s ROAA

especially on Universal Banking and also the restructuring

was at 0.89 percent, ROAE was at 10.61 percent, total

of branches to serve customers more effectively which

loans were THB 635,220 million, increased by THB 28,367

enhances the Fee Based Income and increase efficiency of

million or 4.67 percent from 2010. In addition, the Bank

the services such as Internet Banking and Mobile Banking.

had 2,151 ATM booths. Moreover, to maintain market

Moreover, the quality improvement and business service in

Annual Report 2011 Thanachart Bank Public Company Limited

45


Trade Finance and Cash Management will also build the banks’ interest this year. Building the Strategic Alliances

Securities Business

with other businesses to expand the network and

Products and Services

extending business potentials will also allow the

commercial banks to better serve their target customer

TNS operates two key areas of business, brokerage

versatile. The strategy should also be complemented by

business and investment banking and advisory business.

the Bundling Product and Cross-selling within the bank’s

As of December 31, 2011, the company had a total of 36

own business group such as the Bancassurance in the life

branches and offered the following services:

assurance and insurance businesses.

1. Brokerage Business covers brokerage services

For risk factors in 2012, the global economic

which included a service of securities dealing, securities

recovery is a critical issue that must be monitored closely,

trading, and giving investment advices to investors

especially the economic recovery in the U.S. where its

whether individual, retail, institutional, local or foreign, to

labor market got a better signal at the end of 2011 and the

make decision on their investment.

public debt issue in Europe is intensifying and extending to other countries’ economies. France, Italy and Spain will

2. Derivative Business covers trading services for future contracts and derivatives.

therefore need to exercise strict Fiscal Consolidation while

3. Securities Borrowing and Lending (SBL) covers

they are still lack of solid measures to solve this problem.

services of borrowing or lending securities for customers

Not only economic problems in the U.S. and Europe, the

who has a desire to borrow or lend securities.

Asian economies that are tied to the global economy,

4. Investment Advisory covers services of seeking

especially on the export sector, started to slow down at the

or issuing new financial products, whether local or foreign,

end of the year. Furthermore, political uncertainty in

in order to satisfy the customers’ needs. This also includes

Thailand and performance of government in the fourth

providing customers with investment planning and

quarter of 2011, along with unclear guidelines for

investment diversification by prioritizing customer’s

sustainable water management to prevent the flood in the

suitability and investment objectives for each customer.

long run may affect the confidence of consumers and

Such investment covers various types of instruments.

investors in both inside and outside the country.

Products of Securities Business and Fund Management Business

5. Investment Unit Dealer covers services of sale support and provided fund facts and related information on mutual funds of various asset management companies that TNS represents. 6. Financial Advisory and Securities Underwriting

Securities Business is provided to customers

Services covered financial advisory business, underwriting

through TNS. The company was granted a full license to

service of debt and equity securities both as a role of lead

operate a full range of securities businesses including

underwriter, co-underwriter, and dealer.

securities brokerage (inside and outside Thailand),

7. Securities Registrar covers three types of

securities underwriting, investment advisory service,

services, namely, a securities issuance registrar, securities

securities borrowing and lending service, financial advisory

holder registrar and a registrar for the Employee Stock

service, mutual fund management, private fund

Option Program (ESOP).

management, venture capital management, securities

registrar, and derivatives business Sor 1. Also, the

Competition and Market Outlook

company is engaged in other related businesses that

supported the securities business. As for Fund

1. Brokerage business in 2011 was relatively

Management Business, this service is provided through

volatile, especially in the second half of the year. The stock

TFUND who operates mutual funds, private funds,

market in August 2011 reached its peak level in 15 years

provident fund management businesses and investment

at 1,148 points and later in September 2011 dropped

advisory businesses.

sharply due to a number of negative factors, both domestic

and international such as economic disruption due to

the flood and the debts crisis in euro-zone economies, especially in the PIIGS. In 2011, trading volume reached THB 7.19 trillion, the highest volume since 1975. Retail client transactions captured the highest volume at 55

46

Annual Report 2011 Thanachart Bank Public Company Limited


percent of the market while foreign clients’ transactions

business sector, therefore, become more popular among

returned to a net sales value of THB 5,290.42 million. In

financial institutions who try to enhance their service

terms of mobilization of the number of initial public

potential in the future. Beside domestic competitors, there

offering (IPO) in 2011, there were a total of 12 new IPOs

is competition from foreign private banks, which focus on

(5 companies in SET and 7 companies in MAI). In 2011,

offering investment alternatives in various types of

the SET index closed at 1,025.32 points, 7.44 points lower

instruments in order to create a satisfactory return to

than 2010 while the average daily trading volume was at

major customers in Thailand.

THB 29,473.29 million, the highest volume for SET and the

4. In financial advisory and securities underwriting

second highest behind Singapore Securities. TNS

services, competition was aggressive, especially in

developed new financial products such as the SBL products

mergers & acquisitions, IPOs and fund raising. Though

for trading of foreign securities (offshore securities), so

competition focuses on price, the key competitive factor,

that investors can diversify the risks of investing in a full

thus, remains on service quality, expertise on providing a

range of securities. TNS’s total trading value in 2011 was

customer with relevant advice and solutions to a problem,

THB 553,069.59 million, accounted for 4.43 percent

having a wide network, as well as product innovation,

market share, ranked number 10 out of 35 companies in

which can create value-added and greater benefits to

the industry.

customers of TNS.

2. Currently, there are a total of 41 members in the Thailand Future Exchange (TFEX), of which 36 are general securities companies and 6 are gold-trading

Fund Management Business

members. In 2011, total trading volume was 10,027,116

Products and Service

contracts, or a daily average of 41,145 contracts, an

increase of 120 percent from a daily average of 18,676

TFUND put importance and emphasis on a great

contracts in 2010. As of December 30, 2011, there were

range of retail mutual funds marketing strategies, in order

56,452 outright contracts, a decrease of 28 percent from

to fully cover all needs of investors in every group and

77,955 outright contracts in 2010. The key contributing

level. The company utilized many types of distribution

factor was the popularity of Gold Futures trading which

channels for sales, such as TBANK’s branches and other

almost tripled in trading volume from 971,423 contracts in

investment unit distributors licensed by SEC. The TFUND’s

2010 to 3,989,278 contracts in 2011, with a daily average

staffs are qualified by law and are strictly required to

of 16,350 contracts, valued at THB 11,037 million as the

adhere to related laws and regulations. For greater

gold price has continued to rise to a peak of over USD

convenience, TBANK, acting as investment unit distributor,

1,900 per ounce in the third quarter, as a consequence of

has been supporting sale and redemption of investment

volatility of gold prices in conjunction with the extension of

units offered by TFUND as well as other investment

TFEX’s trading hours to 10.30 pm. since June 2010

management companies it represents through electronic

onwards. TNS trading volume accounted for 2.52 percent

channels.

market share, ranking number 18 out of all members in TFEX.

Competition and Market Outlook

In 2011 there were 62,883 TFEX trading accounts,

an increase of 50 percent from 41,880 accounts in 2010.

As of December 30, 2011, there were a total of

The proportions of the most active investors were domestic

23 fund management companies, with total assets under

individual investors which accounted for 60 percent of the

management of THB 1,750,824.95 million (excluding

market while foreign investors accounted for 33.6 percent

Vayupak Fund, Foreign Funds, Property Fund for Resolving

and domestic institutional investors accounted for 6.4

Financial Institution Problem and Property and Loan Fund),

percent respectively.

an increase of 2.75 percent from 2010. During 2011, there

3. Currently, an investment advisory service is

were 692 newly issued funds, accounting for THB

being offered only by the top-rank securities companies

1,086,169.61 million of net assets. Among the newly

and the large commercial banks which try to offer

issued funds, 228 were domestic and foreign investment

customers with complete and more integrated financial

funds fixed-income funds investing in debt securities with

services. The current major customers focus their priority

maturity not exceeding 1 year, which accounted for THB

on the allocation of investment and diversification of

536,033.50 million of net assets or 49.35 percent of total

financial products to get a better return on investment and

net assets of the newly issued funds during 2011.

to be more efficient in financial management. This

Annual Report 2011 Thanachart Bank Public Company Limited

47


As of December 30, 2011, TFUND had THB

into consideration a fair premium rate to customers.

96,350.78 million assets under management from which

Furthermore, the company constantly adjusted its

retail mutual funds accounted for THB 78,372.94 million,

progressive competitive strategy to be coherent with ever-

private funds accounted for THB 9,087.86 million, and

changing conditions, by ways of increasing sales channels,

provident funds accounted for THB 8,889.98 million.

expanding the customer base, and maintaining the existing

Insurance Business

customer base. As much as 95 percent of all customers are those with a policy claim limit not exceeding THB 5 million.

The customers mostly selected automobile and fire

The Insurance business of Thanachart Group can

insurance and these customers mainly are the Bank’s

be divided into two key areas, namely non-life insurance

lending customers as well as customers from the

operated by TNI, which offers all types of non-life

company’s marketing campaigns.

insurance services, and life insurance operated by TLIFE, which offers life insurance services to institutional, corporate and individual customers.

Non-Life Insurance Business

Products and Services

This service is only offered to domestic customers. The customer group with a policy claim limit of THB

5 million are mostly comprised of institutional customers, private enterprises that possess branch network, both in commerce and industrial sectors. A major portion of this customer group choose miscellaneous and fire insurances.

As aforementioned, it can be concluded that TNI has never

TNI offers all types of insurance services e.g. fire,

relied on any customer group that accounted for more than

automobile, marine, and miscellaneous. In addition, the company also operates investment businesses.

30 percent of TNI’s total revenue. According to Thai Reinsurance Public Company

Competition and Market Outlook

Limited, the Thai economy is expected to continue growing

after 2011, but less than the growth in 2011 due to the

In 2011, non-life insurance business in Thailand

impact of the flood crisis in Thailand and also the

experienced a growth in direct premium income compared

complexity and uncertainty of climate, economic, social,

to 2010, and was expected to grow by 10.6 percent but at

and political conditions. These are key variable factors

a decreasing rate as compared to 2010 which had a growth

determining the direction of the non-life insurance industry

rate of 13.7 percent, primarily due to the effect of the

in Thailand. If economic growth is in line with assumptions,

Tsunami in Japan in April 2011, resulting in a slowdown of

the insurance industry would likely to experience a

domestic automobile manufacturing. Moreover, the flood

moderate expansion of 10 percent in premium received or

crisis in Thailand in October 2011 also affected the entire

a total of THB 151,819 million. Miscellaneous insurance

economy as well as domestic automobile manufacturing

received the highest growth rate 17 percent, followed by

which, in turn, directly affected the non-life insurance business.

automobile insurance with 10 percent, marine &

transportation and fire insurance with 6 and 3 percent,

As for the non-life insurance market structure in

respectively.

2011, automobile insurance received the highest share of the market with a total share of 59 percent, followed by miscellaneous insurance with 32 percent, fire and marine & transportation insurance with 6 and 3 percent, respectively. In 2011, The Office of Insurance Commission (OIC)

Life Insurance Business

Products and Services TLIFE offers life insurance and saving, which can

issued stricter rules and regulations, especially on Risk-

be divided into two key categories, individual and group

Based Capital Requirement, minimum standards of risk

insurance. The license to operate the life insurance

management in non-life insurance businesses. To comply

business was granted by the Office of Insurance

with these rules, domestic non-life insurance companies

Commission (OIC) on 22 October 1997.

opted to emphasize on risk management and become more careful on insurance policy underwriting to avoid high risks.

Competition and Market Outlook

TNI focuses on a standard of products, service

TLIFE operates its business with a multi-distribution

quality, productivity, efficiency and honesty, as well as

channel strategy, in order to satisfy various needs of the

development of new products in order to offer new policies

customers by offering products and services suitable for

which are more coherent with economic and social

each customer group. The company has utilized various

conditions and responsive to customer needs, by taking

channels, such as, the bancassurance channel, corporate

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Annual Report 2011 Thanachart Bank Public Company Limited


network channels, insurance brokers, cooperatives, and

The Individual Life Insurance Product has a

other agents. TLIFE is customer centric, developing new

variety of products such as saving products and annuity

products and offering services suited to the needs of

products. The products with the highest sales figures are

customers and appropriate marketing channels. As TLIFE

as follow:

is a part of the Thanachart Group, the company’s

customers included savings deposit customers, automobile

Speedy Saving 10/2, it is a short-term savings

hire purchase customers, mortgage loan customers, SME

product with premiums due for only 2 years, yet providing

loan customers, as well as customers from other

10 years of life insurance coverage and a cash back policy

corporates, co-operatives and companies through other

at the end of the first year at the rate of 3 percent, and the

distribution channels.

second year to-10 that the rate of 6 percent, and on

maturity date at the end of the 10th year at a lump sum

In the 10-month period of 2011, the life insurance

rate of 200 percent, equivalent to a total cash return

industry captured a total market share of THB 263,317 million representing an increase of 12.12 percent. The main market sector went to individual and group insurance as follows:

benefit of 257 percent. Big Bonus 12/6, it is 12 years life insurance with premiums due for only 6 years with cash back policy for

the first to -fourth year at the rate of 8 percent, the fifth to

Individual insurance received a total premium of

-eighth year at 10 percent, the ninth to -twelfth year at

THB 221,246 million which accounted for 84.02 percent of

the rate of 12 percent, and on maturity at the end of the

the market and a 15.38 percent increase, due to new

12th year at a lump sum of 660 percent, equivalent to

product innovations which are more coherent with the

total cash return benefit of 780 percent.

economic trends, interest rates, target customers’ need

as well as sales promotions and marketing staff skills.

Thanachart Annuity 85/60 (Tax Deductible

Benefit) has premium payments until 59 years of age and

Group insurance received a total premium of THB

coverage period until 85 years of age. While providing

30,587 million which accounted for 11.62 percent of the

benefit of 12 percent annuity between 60-85 years of age,

market, yet, this represented a 3.20 percent decline. The

totaling 312 percent cash benefits with guaranteed annuity

main source of premiums, 53.59 percent, came from

over 20 years. For this plan, insurance premiums can be

Group Mortgage. In the 10-month period of 2011,

used for an income tax shield up to a maximum of THB

mortgage insurance experienced a declining growth at

300,000 per year.

15.02 percent due to a lack of tax incentives on property

transfer fees and mortgage registration fees to encourage

Thanachart Annuity 90/5 (Tax Deductible

consumers to complete housing transfers as in 2010.

Benefit) is a new life insurance products with a coverage

Moreover, the flood occurring in many areas during the

period until 90 years of age and a short period of premium

fourth quarter of 2011 has slowed consumer buying

payments of only 5 years with an annuity benefit of 12

decisions due primarily to the cost of flood evacuation and

percent between 60 to 90 years of age, totaling 372

provision for the cost of home repairs after the flood.

percent cash benefits. For this plan, insurance premiums

Meanwhile, consumers postponed their decisions to buy a

can be used for an income tax shield up to a maximum of

new housing in order to determine the locations safe from

THB 300,000 per year.

the flood. The cumulative 10-month of automobile market

reported sales volume of 713,842 units, 13.6 percent

Group Insurance provided appropriate products

increase compared to the same period of the previous

to each distribution channel, comprising of Thanachart

year. The passenger vehicle market saw a growth of 17.5

Smile Car Plus+ and Thanachart Smile Car Extra which

percent and the commercial vehicle market of 10.6 percent

cover all liabilities of car loans through car hire purchase,

due to strong purchasing power of consumers as well as

Thanachart Smile Home and Thanachart Smile Home Plus

growth in investment and consumption and the continuing

which cover all liabilities of home loans through mortgage

popularity of new vehicles for the first three quarters of

loan, Thanachart Smile SME which covers liabilities of SME

2011. However, the premium from auto hire purchase

loans for enterprises through SME loans. Moreover, the

loans may be subdued due to the impacts of the great

Company also provides group insurance for cooperatives,

flood on the domestic automobile industry.

other companies and organizations.

Currently, the life insurance industry consists of 24

There are many factors to support life insurance

insurance companies. In 2011, the company occupied a

business trend in 2012; to name a few are government’s

total premium of THB 5,791 million, or a 2.20 percent of

rehabilitation plan for the flood disaster in early 2012, Thai

the market share and ranked 10th in the industry.

people’s concern over uncertainty of natural disaster that

Annual Report 2011 Thanachart Bank Public Company Limited

49


motivated them to be aware of and give importance to life

through website of TNS and the other channels to reach

insurance in order to mitigate risk for themselves and their

the target customers as much as possible.

families. As a result, customers purchased more life insurances while insurance companies have developed new

Products and Services Management

policies of various life insurance products that are more consistent with the economic conditions and that expand

Sources of fund

distribution channels to meet customers’ needs. To provide

accessibility, a services provider system has been

One source of TBANK’s fund was the its capital,

developed, prior to and after sale service, training for

comprising of issued and paid-up capital in the amount of

insurance brokers and banks that are life insurance agents.

THB 55,137 million in 2011, including legal reserve and

In addition, the OIC has announced a policy to promote

retained earnings. Another two key sources of fund which

savings and awareness about savings through life

were;

insurance by giving an additional benefits of THB 200,000 income tax shield from life insurance annuities. A number of life insurance companies, therefore, have developed

1. Deposits which by the end of 2011 were in the amount of THB 436,040 million. 2. Borrowings which were in the amount of THB

a variety of life annuity policies to support the diverse

254,296 million, of which THB 218,492 million were short-

structure of the aging population targeting at those over

term B/E since TBANK provided B/E as another saving

60 year old, in order to get a regular income after

alternative for its customers and THB 35,804 million were

retirement. For the aforementioned, it is estimated that

long-term borrowings.

the life insurance business will continue its growth at increasing rate in 2012.

Assets Management Business

Funding or lending to related parties At the end of 2011, TBANK extended loans to

Products and Services

subsidiaries and related companies in Thanachart Group as

follows;

Assets Management Business operates by TS AMC Company Limited (TS AMC) which was established on

1. TGL (subsidiary of TBANK)

TBANK extended loans to TGL for hire purchase

March 3, 2011. The license to operate the assets

business for all types of automobile, in line with the

management business was granted by the BOT and under

business direction of Thanachart Group. In 2011, loan

the Emergency Decree on the Asset Management

outstanding balance was THB 353 million, a decrease from

Corporation BE 2543 (1998), the asset management

THB 934 million at the end of 2010.

company Registration No. 001/2554 dated April 12, 2011. It received the transfer of non-performing assets from

2. National Leasing (subsidiary of TGL)

TBANK extended loans to National Leasing for

SCIB and TBANK, including both non-performing loans and

property hire purchase business as well as property

non-performing assets, in order to conduct debt

leasing. In 2011, loan outstanding balance was THB 22

restructuring with the debtors, hence, allow them to repay

million, a decrease from THB 52 million at the end of 2010.

the debts at their real debt-service capacity and turning

3. Ratchthani Leasing (subsidiary of TBANK)

non-performing assets back to becoming the performing

ones.

TBANK extended loans to Ratchthani Leasing for

hire purchase business for all types of automobile, in line

Competition and Market Outlook TS AMC operates its business with a primary

with the business direction of Thanachart Group. In 2011, loan outstanding balance was THB 7,867 million. 4. TS AMC (subsidiary of TBANK)

TBANK extended loans to TS AMC for asset

objective to manage and restructure the non-performing

management business by receiving transfer and managing

assets received from SCIB and TBANK. To divest or sell

of NPLs and NPAs, in line with the business direction of

those non-performing assets (NPA) to third parties who are

Thanachart Group. In 2011, loan outstanding balance was

interested in real estate market, TS AMC hires a

THB 9,822 million.

professional advisory in assets sales to determine the

selling price and manage the assets in such a way that

Loan outstanding balance of Thanachart Group, as

creates the highest value. It also appoints a professional

aforementioned, totaled to THB 18,064 million, accounted

asset selling agent as well as collaborates with the related

for 2.84 percent of total loans at the end of 2011. All

group of companies to expand sales channels, such as

lending and borrowing activities were transacted under the

brokers or auction agents as well as cross-selling and

permission of the BOT.

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Annual Report 2011 Thanachart Bank Public Company Limited


RISK MANAGEMENT AND RISK FACTORS An Overview of the Risk Management Thai economy grew marginally by only 0.1 percent in 2011 compared to 7.8 percent of 2010, attributed to a combined effect of several risk factors including world economy slowdown, European sovereign debt crisis, Japan’s Tsunami disaster in the second quarter as well as the devastating floods in Thailand in the last quarter of the year which posed substantial impact on agricultural and industrial sectors in a large area. Consequently, export, private consumption, and private investment became contracted in the last quarter of the year. It is, however, forecasted that Thai economy will start to rebound by mid 2012. GDP will grow within a range of 5.5 to 6.5 percent, driven primarily by government’s flooddamage restoration measures and policies that stimulate domestic spending. Yet, there remain a number of risk factors such as uncertainty over the world economic crisis, fluctuation of capital flows, pressure from inflation, and the government’s minimum wage policy, which may adversly affect business operations. Caution must be given in business management in order to cope with uncertainties and to be ready to compete in the global arena, in particular in the year 2015 when Thailand will step into the ASEAN Economic Community (AEC). TBANK and Thanachart Group have realized the importance of risk management. In the year 2011, TBANK continually developed an Internal Capital Adequacy Assessment Process (ICCAP) to support risk other than credit risk, market risk and risk in compliance with Pillar 2 of Basel II framework, in accordance with the Bank of Thailand (BOT) guidelines, which will make TBANK manage funds more efficiently. The Board of Directors and executives of TBANK closely govern, monitor and develop the risk management system regularly to be sure that the measures are appropriate to and prompt on the ever-changing internal and external risk factors. To support the risk management system, TBANK strategically establishes a structure of the organization to support the operation under the direction and supervision of the various committees, as follow:

The Board and Committees at the Policy Level; TBANK’s Board of Directors and the Executive Committee has a role in policy determination and establishes guidelines for an efficient enterprise-wide risk management by taking into consideration the impact of risks on TBANK’s operational goal and financial position that has to be in line with its normal operation. Risk Management Committee plays a role in establishing strategic plans and developing the risk management procedure, as well as considering appropriate risk management policies and guidelines which will be proposed to the Executive Committee and the Bank’s Board of Directors for consideration and approval. Audit Committee has a role in determining the supervisory guidelines for the operation to comply with measures of related authorities as well as assessing the effectiveness and competency of the risk management process and internal control system.

The Committees at the Operation Level; Asset and Liability Management Committee plays a role in supervising the structure of the Bank’s assets and liabilities to be appropriate for characteristics of the business and in line with the Bank’s risk management policy. Investment Portfolio Committee plays a role in supervising investment in financial instruments of TBANK to be in line with the Bank’s market risk management policy. Credit Committee plays a role in supervising the credit lending and other credit-related transactions to be in line with the Bank’s credit risk management policy.

Annual Report 2011 Thanachart Bank Public Company Limited

51


IT Security Management Committee plays a role in establishing policies regarding the IT Security System, proposing preventive measures against risks arising from information and technology system, as well as monitoring, supervising and controlling the operation of the IT Security System in accordance with the proposed plan. Audit Division has a key role in (i) reviewing internal control system, risk management system, the conduct and disclosure of financial information, the operation, the report and supervisory procedures to govern practices in accordance with policies, work plans, rules and regulations of TBANK and its subsidiaries, official rules and regulations of relevant regulators and good corporate governance principle, and (ii) providing consult with other divisions for the sake of development and proper internal control of TBANK’s and subsidiaries’ system.

TBANK’s Risk Management Structure

As of December 31, 2011

Board of Directors

Risk Management Committee

Risk Management

Audit Committee

Executive Committee

Internal Audit

Compliance Risk Management Policy and Capital Market

Credit Analysis I & II

Chief Executive Officer and President

Asset and Liability Management Committee

Risk Control Investment Portfolio Committee

Deputy Chief Executive Officer Office of Executive Committee and CEO

Credit Committee

IT Security Management Committee

• The conduct of business affairs is under a system of check and balance with the Middle office, comprising of

the Risk Control Department and the Back Office, being separated from the Front Office. • TBANK would put in writing all the established policies and guidelines regarding the risk management that specifies responsibilities of related unit as the operational guidelines for the employees. Moreover, the Bank has established a four-step guideline for risk management comprising of; 1) identification of the characteristics of risk as well as risk factors, 2) development of appropriate tools and models for risk measurement, 3) the control of risks within acceptable limits and 4) the close monitoring of risk status in order to properly manage any possible risks in a timely manner. • The difference in size and risk ratios determined for each exposure allowed TBANK to be able to perceive the degree of severity from the possible risks. These risk variables could also be used as a ceiling or the acceptable risk level

as well as to provide warning signals before severe losses occur. The aforementioned risk management systems are developed based on prudent principles and will be reviewed regularly to suit prevailing situations. The systems are designed to be transparent, explicit examinable and to take into consideration the interests of shareholders, customers and staff of the Bank.

52

Annual Report 2011 Thanachart Bank Public Company Limited


Key Risk Categories 1. Credit Risk Credit risk arises from a situation in which the debtors or counterparties fail to repay or fulfill their agreed obligations. This might be contributed by the fact that the debtor’s financial position is under distress due to volatilities of economic conditions that pose adverse impact on businesses or the debtors’ mismanagement, which as a result, may adversely affect TBANK and the subsidiaries’ earnings and capital. The credit risk may arise from ordinary financial transactions such as credit lending, financial obligations in the form of avals or guarantees, other transactions related to credit lending, as well as investment in debt instruments issued by state agencies or state enterprises with neither guarantee from government nor the BOT and private debt instruments such as debentures. Under its credit risk management policies and guidelines, TBANK has successfully established a credit culture. To start with, the credit risk of the borrowers, counterparties or issuers of debt instruments will be independently assessed by the model developed specifically to each type of borrowers or counterparties by the Credit Analysis Unit. At this juncture, authorized Credit Committee would then consider and determine the level of credit risk of borrowers or counterparties, appropriate credit lines and investment budget, as well as terms and conditions on loans or other obligations. The Committee also controls the overall risk status by appropriately diversifying credit risk into various business sectors and groups of customers within the established risk ceilings. In addition, the Committee closely monitors the quality of loans to ensure proper and vigilant management by emphasizing on business capability and repayment ability under the supervision of an independent risk control unit. Apart from the aforementioned units, there is also an Internal Audit Division to verify that the credit transactions are in compliance with the BOT’s guidelines. To ensure optimal returns under acceptable risk, TBANK has employed measuring tool called RAROC (Risk Adjusted Return on Capital) to reflect the appropriate level of capital. Moreover, the Bank also performed stress tests to estimate any damage that may occur during the crisis. Under this condition, the borrower’s ability to repay could erode or they could fail to make a repayment under terms and conditions stated in the hypothesized contract. The risk factors in the tests were assumed to affect the industry that the debtors’ business belonged to.

Important credit risk factors 1.1 Credit concentration risk TBANK aims to appropriately diversify its loans to various groups of customers, focusing on high potential customers and attempt to prevent concentration of loans to a particular group of customers. Under such goal, the TBANK pursues proper risk management on overall credit portfolios with close monitoring and comprehensive assessment to report to the assigned committees on a regular basis. The purpose is to mitigate exogenous risks that may adversely affect any particular group of business excessively financed by the Bank.

Annual Report 2011 Thanachart Bank Public Company Limited

53


Table of credit status As of December 31, 2011 compared to December 31, 2010 classified by business types was as follow:

Business type

2011 Debt balance (THB Million)

2010 Percent

Debt balance (THB Million)

Percent

Agricultural and mining

10,830

1.71

10,957

1.81

Manufacturing and commerce

81,967

12.90

97,384

16.05

Real estate and construction

47,972

7.55

52,406

8.64

Public utilities and service

58,441

9.20

66,047

10.88

Housing loans

73,636

11.59

77,636

12.79

2,236

0.35

2,683

0.44

286,361

45.08

239,611

39.48

73,777

11.62

60,127

9.91

635,220

100.00

Margin loans for securities business Hire purchase Others Total loans and accrued interest receivables

606,851 100.00

The overall credit data revealed that TBANK’s lending on hire purchase business grew moderately from 39.48 percent as of December 31, 2010 to 45.08 percent of total loans and accrued interest receivables as of December 31, 2011. Most of these hire purchase loans were provided to retail customers whose credit line was relatively small and with a large number of customers, such risk therefore was well diversified.

1.2 Risks from non-performing loans The non-performing loans are loans classified as substandard, doubtful and doubtful of loss. They have been

the major concerns across financial institutions due to their adverse effect on earnings and capital of TBANK and subsidiaries. At this juncture, TBANK has focused major efforts on controlling credit quality through appropriate policies and procedures to regularly monitor the quality of the loans.

Table of the NPLs Ratios As of December 31, 2011 compared with those of December 31, 2010 were as follow:

Loan classification Substandard

2011 Debt balance (THB Million)

2010 Percent

Debt balance (THB Million)

Percent

7,026

18.65

6,649

18.04

Doubtful

12,059

32.01

13,948

37.84

Doubtful of loss

18,592

49.34

16,262

44.12

Total

54

Annual Report 2011 Thanachart Bank Public Company Limited

37,677 100.00

36,859 100.00


TBANK and subsidiaries’ non-performing loans increased from THB 36,859 million as of December 31, 2010 to THB 37,677 million as of December 31, 2010. From the credit overview, the non-performing loans were accountable for 5.93 percent of total loans and interest receivables, dropped from 6.07 percent as of December 31, 2010. The nonperforming loans could be classified by types of business as follow:

Table of Non-Performing Loans Classified by Type of Business

Type of Business Agricultural and mining Manufacturing and commerce

2011 Debt balance (THB Million)

2010 Debt balance (THB Million)

Percent

Percent

347

0.92

401

16,588

44.03

14,924

1.09 40.49

Real estate and construction

3,767

10.00

4,745

12.87

Public utilities and service

5,510

14.62

5,981

16.23

Housing loans

3,501

9.29

2,807

7.62

306

0.81

1,339

3.63

Margin loans for securities business Hire purchase

3,553

9.43

3,977

10.79

Others

4,105

10.90

2,685

7.28

36,859

100.00

Total loans and accrued interest receivables

37,677

100.00

As of December 31, 2011, TBANK and its subsidiaries, under the BOT’s supervision, had no credit risk from non-performing loans that collateral did not fully cover the remaining loan amounts after deducting provision for loan loss. This was due to the fact that 100 percent provision was allocated on such loans by the Bank in compliance with the International Accounting Standards No. 39 (IAS39).

Table of Non-Performing Loans

(Unit: THB Million)

2011

2010

Change

Non-performing loans (NPLs)

37,425

35,606

Loans not fully covered by collateral

19,585

19,184

401

Provision for loan loss

19,725

19,374

351

Loans not fully covered by collateral after loan loss provision

-

-

-

383

534

General provision for loan loss

1,819

(151)

Annual Report 2011 Thanachart Bank Public Company Limited

55


Table of Troubled Debt Restructuring

(Unit: THB Million)

2011

2010

Number of debtors (persons)

53,922

20,194

Outstanding principal and accrued interest receivables

38,816

28,230

Loans not fully covered by collateral

14,558

12,009

382

460

636,183

607,775

6.10%

4.64%

Revaluation allowance for debt restructuring Total loans and accrued interest receivables Restructured debts to total loans (percent)

The risk on debt restructuring arises from the re-entry of the substandard debtors, i.e. after the debt restructuring, the debtors again default on their repayments and hence re-enter the non-performing status. The problem poses adverse effects on debt-restructuring performance of TBANK and its subsidiaries. As of December 31, 2011, the outstanding principal and the accrued interest receivables of the restructured debt amounted to THB 38,816 million or 6.10 percent of total loans and accrued interest receivables. The net restructured debt (less collateral) amounted to approximately THB 14,558 million.

1.3 Risks from Collaterals For collateralized loans, TBANK carefully assess and classify quality of each type of collateral by taking into

account the liquidity and overall risk from that collateral. The assessment result is one of the important factors applied in the classification of each credit exposure. In this regard, the collateral, both in the form of immovable and movable whose value could be appraised, is subject to appraisal or valuation complying with the BOT’s regulation. TBANK significant types of collateral are deposits and bills of exchange, marketable equity securities, non-listed equity securities, commercial immoveable property, immovable property from housing, vehicles, machinery, etc. TBANK has determined guidelines, standards and frequency of appraisal and valuation of each type of collateral. Furthermore, a report of the appraisal and valuation is made which includes clear and sufficient data and analysis to determine the price. In the case that it cannot be specified whether the collateral price has decreased or declined over time, the impairment of the asset must be considered by an official. In the past years, automobile hire purchase loans of TBANK and its subsidiaries have continued to expand. According to the BOT notification regarding the valueless and non-callable assets dated December 2006, the regulations on provisioning based on IAS39 whereby cars whose ownership belongs to the Bank can be used as collateral. In the case of default, the Bank is eligible to immediately repossess to collateral for the purpose of reselling in the used car market. As a result, TBANK and its subsidiaries might be exposed to risk from the inability to repossess the cars or from recovering the incurred loss by reselling the assets. Such conditions depend on various risk factors, for instance, the conditions of the used car market and the repossessed car itself.

1.4 Risk from Guarantees and Avals Under the current customer service, TBANK and its subsidiaries are also obligated in forms of avals, letter of

credits and loan guarantees, which TBANK and its subsidiaries are held responsible for, should the customers are unable to fulfill their obligations. In managing such risk, TBANK carefully scrutinizes supporting information and applies strict approval procedures to these obligations. The close monitoring on these transactions is undertaken based on the same guideline used for its regular lending procedure of TBANK.

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Annual Report 2011 Thanachart Bank Public Company Limited


As of December 31, 2011, TBANK and its subsidiaries’ obligations in the form of avals and guarantees for loans amounted to THB 26,752 million or 3.02 percent of the total assets.

2. Market Risk The market risk arises from movements in interest rates, exchange rates and prices of instruments in money

market and capital market, which may adversely affect earnings and capital of TBANK and its subsidiaries. The market risk can be segmented into three categories including price risk, interest rate risk and exchange rate risk. At this juncture, TBANK’s policies are to control and manage these risks to remain at an appropriate level and inline with TBANK’s policy on risk management.

2.1 Price Risk Price risk arises when TBANK and its subsidiaries’ earnings or capital are adversely affected by changes in the

price of debt and equity instruments, causing the value of TBANK and its subsidiaries’ trading and available-for-sales investment portfolio to decline. TBANK has developed risk measurement tools based on the Value-at-Risk (VaR) model to estimate the maximum loss amount at a certain confidence level and over a given asset holding period. TBANK also determine the various limits of transactions in order to control risk to remain in as acceptable level, for example; Position Limit, Loss Limit and VaR Limit. The Risk Control Unit, separated from the front office and the back office, has the duty of risk control and reporting on the status of the limits to the Board of Directors, departments and executives associated to the risk management. In order to ensure the efficiency and accuracy of its tools for risk measurement, TBANK requires that the tools are subject to back-testing in accordance with the Bank of International Settlement (BIS) standards. Moreover, TBANK has conducted stress testing by formulating stress scenarios which can create extraordinary reduction in stock prices.

The test result could therefore shed light on the impact on TBANK earnings and required capital should such events occur. As of December 31, 2011, TBANK and its subsidiaries’ trading investments and available-for-sale securities classified by type of investment were as follow:

Table of trading investments and available-for-sale securities classified by type of investment Fair Value (THB Million) 2011

2010

Trading investments Government and state enterprise securities

10,479

45

Private debt securities

4,758

21

Foreign debt securities

637

3,023

38

80

15,912

3,169

Domestic marketable equity securities Total trading investments Available-for-sale investments Government and state enterprise securities

41,003

52,604

Private debt securities

18,533

10,064

Foreign debt securities

25,425

12,920

7,983

8,530

92,944

84,118

108,856

87,287

Domestic marketable equity securities Total available-for-sale investments Total trading and available-for-sale investments

Annual Report 2011 Thanachart Bank Public Company Limited

57


TBANK and its subsidiaries have invested more in debt securities, thus, the value of trading and available-forsale investments have increased. As a result, the price risk of TBANK and its subsidiaries are higher than the previous year.

2.2 Interest Rate Risk The interest rate risk is the risk that earnings or capital are adversely affected by changes in interest rates

that pose impact on its rate-sensitive items including assets and off-balance sheet items whose repricing periods are mismatched. These changes may have a negative impact on net interest income of TBANK and its subsidiaries. It is the goal of TBANK to run their business operations under a long-term effective interest rate risk management system. In other words, to maintain an appropriate structure of assets and liabilities which are rate-sensitive at different time intervals. To ensure maximum benefits of TBANK’s shareholders, TBANK has developed the Repricing Gap Analysis Model as a tool for measuring interest rate risk by assessing the impact that may arise from the mismatch of the repricing periods of assets, liabilities and obligations at different time intervals, which is used for risk measurement every month. In order to ensure that the risk of TBANK business operations is within an acceptable limit, they have also established an acceptable risk ceiling and an early warning risk level, taking into account the structure of assets, liabilities and obligations as well as interest rate repricing which are expected to take pace in each period of TBANK business plan. The Asset and Liability Management Committee (ALCO) is responsible for monitoring and controlling such risk very closely. To effectively design appropriate measures to accommodate the risks, the committee has to monitor economic conditions, development in the money market and capital market and the interest rate trend which could become important risk factors to the Bank’s rate-sensitive items. Details of financial assets and liabilities as of December 31, 2011, classified by the period when the interest rates would be repriced in accordance with contracts related to financial assets and liabilities of TBANK and its subsidiaries were as follow:

Table of Financial Assets and Liabilities (Unit: THB Million)

Items

Period of interest rate repricing or due date At call

0-3 months

3 - 12 months

1 - 5 years

Over 5 years

No interest

Total

Financial assets Cash Interbank and money market items

-

-

-

-

-

16,006

16,006

23,000

29,523

2,655

-

-

8,137

63,315

-

-

-

-

-

1,536

1,536

12

14,772

46,447

57,851

16,781

13,308 149,171

316,891

22,243

15,445 212,320

68,113

208 635,220

-

-

-

-

-

25

25

-

-

-

-

-

858

858

339,903

66,538

64,547 270,171

84,894

Derivatives Investments Loans Receivables from clearing house Receivables from purchase and sale securities and derivatives Total financial assets

40,078 866,131

Financial liabilities Cash

174,608

169,399

77,929

8,404

-

5,700 436,040

20,877

32,220

5,379

217

-

1,458

Liabilities payable on demand

-

-

-

-

-

2,131

2,131

Derivative liabilities

-

-

-

-

-

2,886

2,886

133,517 103,060

Interbank and money market items

Borrowings

999

60,151

16,700

21

-

-

-

-

-

306

306

-

-

-

-

-

851

851

196,484 335,136 186,368

25,321

21

Payables to clearing house

- 254,297

Payables from purchase and sale securities and derivatives Total financial liabilities

58

Annual Report 2011 Thanachart Bank Public Company Limited

13,332 756,662


Based on the aforementioned structure of financial assets and liabilities, TBANK’s net interest income

in the next year would decrease should the market interest rate increase. This was mainly due to the expansion of TBANK’s hire purchase business with fixed-interest-rate feature.

2.3 Exchange Rate Risk The exchange rate risk is a risk that the earnings or capital of TBANK and its subsidiaries can be adversely affected by exchange rate fluctuations from transactions in foreign currencies, exchange rate exposures in their possession of assets or liabilities in foreign currencies. There are two types of exchange rate risk-risk from transactions in foreign currencies (Transaction Risk) and risk from exchanging foreign currency to local currency (Translation Risk). The ALCO is responsible for monitoring and controlling this type of risk through the consideration

in the proper matching between the structure and the maturity of assets and liabilities in foreign currencies. TBANK’s policy is to also rely on the VaR ceiling in order to control the impact of exchange rate movements on earnings and capital. Nevertheless, in order to avoid the exchange rate risk, TBANK has also relied on hedging instruments such as forward contracts. As of December 31, 2011, TBANK and its subsidiaries faced with relatively low exchange rate risk as most

of the assets in foreign currencies have been hedged by forward contracts.

3. Liquidity Risk Liquidity risk arises from the inability of TBANK and its subsidiaries to repay their debts or obligations upon the delivery date due to the lack of ability to convert assets into cash or to mobilize adequate funds or to mobilize funds at an acceptable cost. This could adversely affect the current and future earnings and capital of TBANK and its subsidiaries. The liquidity risk management mechanism starts with the assessment of the cash flows and liquidity position over particular time horizons of TBANK when the different levels of funds may be required to accommodate deposit withdrawal, reduce other types of the Bank’s liabilities or increase the Banks’s assets by using the Liquidity Gap Analysis. Various liquidity ratios and “What if” scenarios to evaluate the sufficiency of the cash flow liquidity depending on customer behavior in extending contracts upon maturity and estimate the need of liquidity in various “What if” scenarios depending on the economic climate and extraordinary situations that may happen to TBANK and the financial institution system. Meanwhile, TBANK and its subsidiaries developed an emergency plan in the case of a liquidity problem and there will be a revision of the significant occurrences that affect working operations. In this regard, TBANK and its subsidiaries have assigned ALCO, controlling and managing the liquidity risk with a weekly meeting to monitor and manage risk. The structure of TBANK’s capital fund could be classified by different type and maturity of source of funds

as follow:

Table of Capital Funds Classified by Source (Unit: THB Million)

2011 Deposits Domestic interbank and money market items Foreign interbank and money market items Borrowings Total

Percent

2010

Percent

436,040

58.10

532,656

70.27

50,851

6.78

33,251

4.39

9,300

1.24

7,294

0.96

254,297

33.88

174,949

23.38

750,488

100.00

748,150

100.00

Annual Report 2011 Thanachart Bank Public Company Limited

59


Table of Capital Fund Classified by Maturity (Unit: THB Million)

2011

Percent

2010

Percent

Less than 1 year

701,284

93.44

680,818

91.00

More than 1 year

49,204

6.56

67,332

9.00

750,488

100.00

748,150

100.00

Total

As of December 31, 2011, deposits and borrowings of TBANK and its subsidiaries amounted to THB 750,488 million, where sources of funds were mostly from public deposits with the maturity less than one year. This is considered

a common structure of the commercial banks. Nevertheless, TBANK and its subsidiaries also issued bills of exchange

and debentures in order to increase the saving alternatives for their customers. The financial assets and liabilities as of December 31, 2011 classified by maturity date were as follow:

Table of the Financial Assets and Liabilities (Unit: THB Million)

Items

The maturity date of financial instruments Less than More than 1 year 1 year

At call

Not specified

Total

Financial assets

Cash

Interbank and money market items

Derivatives

Investments

Loans

Receivables from clearing house

-

25

-

-

25

Receivables from purchase and sale securities and derivatives

-

858

-

-

858

Total financial assets

16,006

-

-

-

16,006

8,368

54,827

120

-

63,315

-

1,536

-

-

1,536

1

67,445

68,908

12,817 149,171

47,672 193,205

394,343

- 635,220

72,047 317,896 463,371

12,817 866,131

Financial liabilities

Cash

Interbank and money market items

Liabilities payable on demand

Derivative liabilities

Borrowings

Payables to clearing house

-

306

-

-

306

Payables from purchase and sale securities and derivatives

-

851

-

-

851

200,827 506,613

42,074

Total financial liabilities

176,616 249,835

9,589

- 436,040

21,081

35,306

3,764

-

60,151

2,131

-

-

-

2,131

-

2,886

-

-

2,886

999 217,447

28,721

7,130 254,297

7,130 756,662

Off-balance sheet items

Avals to bills and guarantees of loans

Obligation under unmatured import bills

Letter of credits

1

1,572

43

-

1,616 1,105

624

481

-

-

86

2,540

-

-

2,626

Other commitments

41,732

6,138

2,061

2

49,933

Total off-balance sheets

42,443

10,731

2,104

2

55,280

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Annual Report 2011 Thanachart Bank Public Company Limited


4. Operational Risk

aspect of data and technology. A particular focus is given

to the prevention of damages from unauthorized access to

The operational risk is the risk that arises

the Bank’s information.

from the damage that occurs from lack of good corporate

governance within the organization. Risk may also arise

• Formulate the Business Continuity Plan

from the inadequate efficiency of the internal audit and

which consists of an emergency plan, a plan for backup

internal control systems which could be relating to internal

systems and a business recovery plan to prevent

operation process, personnel, systems or external events.

disruption in business operation. In addition, the drills are

This also includes legal risks such as litigations,

essential to test for the readiness and to consistently

exploitation by the government and also damage from

improve the plans for its effective implementation.

settlements outside the courtroom. Such risks can pose adverse impact on other risks, especially strategic risk and

TBANK also employs the services of the third party to operate some group activities as per the direction

reputation risk.

of the work operations of financial institutions at present

TBANK

has

established

policies

and

and in the future. TBANK determines policies in order

guidelines to ensure the prevention and monitoring of this

to manage the risk that may occur from outsourcing.

type of risk. As the internal control system is an important

These policies have to also be subject to regulations

tool in controlling and preventing potential risk that may

of BOT and must be beneficial to the internal control

occur, TBANK has implemented an efficient internal control

of the Bank as well.

system as follow:

In the measurement and assessment

• Regarding the organization of the Bank’s

of operational risk, TBANK determines a principle, form

structure, TBANK has specified the roles, the scope of

or condition of the process used in the measurement and

duties and responsibilities for each position, based on a

assessment of risk in TBANK. In the determination of this

system of check and balance. The front office where all the

process, TBANK considers the circumstantial factors

transaction takes place is separated from the middle office,

such as supervising guidelines of the government units

comprised of the Risk Control Department and the back

associated with the Bank, state and complexity of

office who record all items in the transactions.

the business, the capability of the Bank in accepting risk,

probability, likelihood or frequency as well as the impact

• Establish the transaction-supporting units

or severity of risk that has happened or may happen.

which are independent and have expertise in their

As per BOT specification for commercial bank to maintain

respective fields of work such as information technology

the funds to risk-weighted assets in credit, market and

unit, legal and appraisal unit in order to prevent any

operation according to Basel II guidelines, TBANK has

possible errors that may arise

employed the Basic Indicator Approach to calculate

• Put operational procedures and regulations

operational risks.

related to all types of transaction, staff manuals as well as

In addition, to monitor operational risk,

the authority ranks for approval in writings as a guideline

TBANK determined a policy for executives of each

to set the same standards for all internal operations within

department to have the responsibility of monitoring the

the organization

risk and consider a part of their regular duties. This will

help promptly inform all of the risk and problems that

• Establish the Audit Committee and the Risk

occur and to respond to the changes in each time period in

Management Committee to control, monitor and assess the

an appropriate and timely manner, not damaging to the

risks of TBANK. The committees are responsible for

Bank. Nevertheless, to inform of the result of business

examining and correcting the pitfalls in order to create

operations and problems that occur, as well as trends and

soundness and efficiency in the Bank’s operation.

chages in information of risk factors, TBANK organized

a filing and reporting of the information associated with

• Improve the management of the information

operational risk management such as information on data

technology system and information security system in

loss, key risk indicatiors and important risk points to be

order to enhance its potential to accommodate business

continually and regularly reported to the Board of

expansion and gain credibility from the customers in the

Directors, the Risk Management Committee and the

Annual Report 2011 Thanachart Bank Public Company Limited

61


executives to use in the determination of policies,

7. Risk from Capital Inadequacy

to develop a sufficient risk management system and

to be a tool in aiding TBANK to evaluate the capability

and efficiency of the internal control system.

5. Strategic Risk

TBANK calculates its capital to cushion any possible risks, in accordance with Basel II criteria as follow:

• Credit risk by means of the Standardized This type of risk arises from the inappropriate

Approach

formulation of strategies, business planning and

implementation which are not compatible with internal setups and external environment, resulting in an adverse

• Market risk to explore status of market risk by means of the Standardized Approach

impact on earnings, capital or the existence of TBANK and

its subsidiaries. In managing the strategic risk, the formulation of strategies of TBANK will be considered over the three years ahead, with the review required annually

• Operational Risk by means of the Basic Indicator Approach

or in the case of an external event that may impact the

In addition, TBANK has assessed its future

achievement of the Bank’s business goals. The Executive

capital adequacy based on budget and 3-year business

Committee is responsible for regular monitoring and

plan. The risk calculated is capped with risk limit in which

evaluating the performance of the work units upon the

the Risk Management Division monthly reports the

established targets stated in the annual operation plan.

adequacy of capital to the Executive Committee and the

6. Regulatory Risk

Board of Directors to ensure that TBANK has sufficient capital after risk capital allocation to support sustainable business’ growth as planned.

The regulatory risk arises from amendments

or changes in regulations, laws or requirements of the

As of December 31, 2011, TBANK’s total

authorities especially the BOT. Changes in the authority’s

capital registered at THB 91,093 million of which THB

policy may affect the strategies and business operations

61,638 million was Tier I capital and THB 29,455 million

of TBANK and its subsidiaries.

was for Tier II. The BIS ratio amounted to 13.72 percent

which exceeded the BOT’s minimum requirement at 8.50 In 2011, most changes in regulations and

percent. This level of capital should be sufficient in

requirements from the related authorities have

accommodating any potential risks as well as the Bank’s

concentrated on the improvement of measures to promote

future business expansion.

corporate governance of financial institutions, more efficient risk management and improved consumer protection. These measures therefore posed no significant impact on the strategies and business operation of the Bank. And throughout, TBANK has constantly improved and developed the internal operation system as well as customer service standard. This has also been an important mission for the Bank that the business operation has to also comply with authorities’ rules and regulations.

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Annual Report 2011 Thanachart Bank Public Company Limited


CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES Corporate social responsibility Thanachart Group is an organization that adheres to the principles of corporate social responsibility both in its conduct of business affairs and its participation in other social activities. The objectives are to create sustainability and the well-being of society and people living in communities as well as to protect the environment. In addition, our employees are encouraged to participate in CSR-related activities.

CSR-in-Process This type of corporate social responsibility (CSR) focuses on conducting business affairs with responsibility towards society. In this connection, Thanachart Group has been embracing the principles of corporate social responsibility for a long time. We treat all our groups of stakeholders including shareholders, customers, consumers, and business counterparts in a fair and equitable manner. Recognizing the importance of good corporate governance, we also place strong emphasis on transparency in information disclosure. With the support of Chulalongkorn University’s Continuing Education Center, we regularly and continuously organize training activities for our staff on good corporate governance. In regard to our employees, we have promoted and fostered good relations with our staff by offering competitive remuneration, excellent welfare benefits, and a stimulating work environment. In addition, as part of our energy conservation policy, Thanachart Group encourages staff to participate in activities aimed at conserving electricity and other energy sources and using less paper, thus preserving the environment. In 2011, many provinces of Thailand were severely hit by the floods. In response, Thanachart Group introduced

a number of measures aimed at helping both corporate and individual customers who were flood victims. These included

a grace period of up to 90 days for hire purchase loans as well as extension of the repayment period for up to 12 months. As for home loans, borrowers could suspend repayment of principal amounts for up to 12 months. As well, a total of

THB 5 billion was set aside for loans to small-and-medium-sized enterprises (SMEs) with the principal repayment period extended by up to one year. In regard to ATM and debit cards, fees for all cash withdrawals and transfers thru

TBANK’s ATMs, including all inter-region withdrawals and transfers were waived. Moreover, the fees for inter-bank cash withdrawals as well as cash transfers between bank accounts with TBANK which were tied to the same card were also waived. As well, annual fees and fees for issuing replacement cards lost or damaged during the flood were waived for customers who were flood victims. Holders of Thanachart Drive Credit Cards and FLASH Cards could request a grace period, lower monthly repayments, or extension of their repayment period until the situation returned to normalcy.

CSR-after-Process This type of corporate social responsibility (CSR) covers any activities other than those undertaken in the ordinary course of business. Thanachart Group has been involved in these types of activities for a long time. However, since the commercial banking services became one of Thanachart Group’s main businesses with an extensive branch network nationwide, the corporate social responsibility activities have been implemented in line with the policy established by the central organization. The activities have also been supported by the regional hubs concerned. In this connection, the CSR Committee is responsible for approving the programs and financial support for all activities. After the approval is granted, the Bank’s staff and members of Thanachart Group in each regional hub will start implementing the CSR activities together. Their customers and trading partners, as well as people living in communities, will also be encouraged to participate in the activities. As a guideline for the implementation of the activities, the organization has established a framework of social issues to be addressed. They can be divided into four main groups as follows:

Annual Report 2011 Thanachart Bank Public Company Limited

63


1. Development activities for disadvantaged children and youth

from the kindergarten level to Prathomsuka 3, which participated in the project. The activities have been

2. Community health and hygiene

implemented over the past five years, during which time,

3. Conservation of culture and national identity

28,800 safety helmets for children were given to various

4. Assistance to people who are adversely affected

schools. The Bank will continue implementing its activities

by natural disasters

which include the delivery of safety helmets to children

Thanachart’s public concern– motorcycle helmets for kids This project was initiated in 2007 by the regional hub based in Hat Yai. The main objective was to give

as well as the campaigns aimed at inculcating in adults

the importance of the safety helmets.

Thanachart initiates and fulfils Thai identity project

motorcycle helmets to young students who rode

The activities of the project place emphasis on

motorcycles to their schools in Hat Yai District and Muang

promoting the country’s unique identity and beautiful

District in Songkhla Province. During the period from

culture by encouraging young people to read Thai out loud

2008 - 2010, the project’s coverage areas were extended

with correct pronunciation and to learn about good

to include Nakhon Sawan, Phitsanulok, Nakhon Pathom

manners in Thai culture, which they can adopt in daily life.

and Udon Thani Provinces. TBANK recognizes the

This is an extension of SCIB’s previous project entitled

importance of reducing the number of casualties caused by

“Siam City Bank conserves Thai identity” which was

accidents in which small children are involved, principally

continuously implemented for over 39 years. The project

when they sit at the rear of motorcycles without wearing

consists of two main activities including reading aloud

helmets. But this will only happen when parents become

contests and Thai manners contests. First rounds of the

more concerned with children safety and the standard

contests to select qualified candidates are organized in four

helmets for young children become less expensive. There

regions including North, North East, South and Central

are far fewer manufacturers of motorcycle helmets for

(including Bangkok). Educational institutions are provided

children than those producing helmets for adults. The

with an opportunity to send students from Prathomsuksa 1

project also helps inculcate into parents and children the

to the university level as their representatives to

importance of wearing safety helmets every time they ride

participate in the contests to compete for H.R.H. Princess

motorcycles from home to school and vice versa. The

Maha Chakri Sirindhorn’s Cups, honourable shields and

project has been continuously implemented and has

certificates of honour, as well as scholarships. In 2011, the

received very good responses from the parents and their

Bank organized a contest to decorate a traditional Thai

children participating in the project. It is also in line with

pedestalled tray (or Phan in Thai) which contained candles

the Bank’s CSR policy aimed at creating a motorcycle

and joss sticks. The objective was for the young people to

safety culture which encourages children who sit at the

come up with creative ideas to decorate beautifully a set of

rear of motorcycles to wear safety helmets. As well, it is in

Thai style altar tables. The project was supported by

line with the Bank’s campaign aimed at promoting safe

qualified experts from the Office of the Permanent

driving habits. The related activities help mitigate

Secretary of the Ministry of Culture, the Department of

casualties caused by accidents in which the victims do not

Cultural Promotion of the Ministry of Culture, the Office of

wear safety helmets.

the National Broadcasting and Telecommunication Commission

On the occasion of His Majesty the King’s

(NBTC), the Royal Institute, the National Identity Office, 84 th

and Phra Tumnuk Suankularb School, as well as experts on

Birthday Anniversary in 2011, the Bank organized activities

each region’s culture, who served as panel judges for the

under the project entitled “Thanachart’s concern–motorcycle

contests.

helmets for kids to wear, 84th birthday and 84 schools”

in honor of His Majesty the King. As well, it launched a

The project was first initiated in 1972 in the form of

campaign aimed at promoting traffic knowledge and

a contest organized on “Thai Manners” under the auspices

discipline as well as the culture of ensuring that both

of Bangkok Metropolitan Bank. Later in 1980, the first

parents and children wear safety helmets every time they

“Reading Aloud Contest by Bangkok Metropolitan Bank”

sit at the rear of motorcycles. As part of the activities,

was organized. In 1995, it humbly requested that H.R.H.

20,000 helmets whose standards were certified by the Thai

Princess Maha Chakri Sirindhorn graciously give royal cups

Industry Standards Institute (TISI) were given to students

to top winners of the two contests. In 2002, Bangkok

studying at 84 government and private schools nationwide

Metropolitan Bank merged with SCIB and the name of the

64

Annual Report 2011 Thanachart Bank Public Company Limited


identity”. Recently in 2011, SCIB merged with TBANK, the

Sapan Boon Project (Bridge-togood deeds Project)

project then has been sustained with the name changed to

project was changed to “Siam City Bank conserves Thai

The Bank provides holders of TBANK ATM cards

“Thanachart initiates and fulfils Thai identity project”.

with the convenience of making merit via its ATMs.

The intention to preserve Thai identity is the

Customers can donate money to several charitable

inspiration behind the project. The activities of the project

organizations via the TBANK’s ATMs free of charge. The

include reading Thai aloud and adopting Thai manners in

Bank serves as a bridge for its customers to make

daily life. The objective is for Thai people to preserve the

donations to many organizations that dedicate themselves

unique values and prevent their disintegration over time as

to solving problems in Thai society. In doing so, the Bank

a result of western values which are influencing young

serves as a channel for raising funds to support charitable

people to move away from their culture. Moreover, the

foundations and organizations. Moreover, the Bank

project also helps inculcate in Thai youths the love of Thai

supports the Foundation for Slum Child Care (FSCC) under

culture. This will make them cherish the culture and help

the Royal Patronage of H.R.H. Princess Galyani Vadhana

sustain it for Thai society. Both the Thai language and

Krom Luang Naradhiwas Rajanagarindra. In 2011, it gave

Thai manners are internationally recognised as unique

the Foundation THB 1,170,000 which was sourced from

characteristics of Thai identity.

charity collection boxes placed in 680 branches of the Bank

nationwide. The donations were made by customers and

In 2011, over 3,000 students from 980 educational

staff of Thanachart Group for paying living expenses,

institutions nationwide participated in the ‘Thanachart

education and enhancing the quality of life of children so

initiates and fulfills Thai Identity’ project. The students

that in the future they will grow up to become responsible

were divided into five groups according to their

youths and good citizens of the country. The activities have

educational levels, including the first level of primary

been continuously supported by TBANK for over 10 years.

education (Pathomsuksa 1 - 3), second level of primary

education (Pathomsuksa 4 - 6), lower secondary education (Mathayomsuksa 1 - 3), upper secondary education (Mathayomsuksa 4 - 6), and the university level. The contests were held during the period from July to September 2011.

1

2

3

4

Pictures 1 - 2: Royal Kathin Robes Thanachart Group offered Royal Kathin robes to

Wat Pa Pradu, Muang District, Rayong Province, and

with member companies of Thanachart Group, their

customers, trading partners, executives, and staff

as well as members of the general public all jointly

donated THB 7,977,422.27 in good faith to the

temple as part of the funds to be used for

constructing a new sermon hall. Picture 3: Financial Support to Slum Children TBANK gave THB 1,170,000 to the Foundation for

Slum Child Care (FSCC) under the Royal Patronage

of H.R.H. Princess Galyani Vadhana Krom Luang

Naradhiwas Rajanagarindra. The money was sourced

from charity collection boxes placed in 680 branches

of the Bank nationwide. The donations were made

by customers and staff of Thanachart Group. Picture 4: Thanachart joined hands to help flood victims

in 2011 Member companies of Thanachart Group jointly gave

5,000 survival bags to the Royal Thai Navy based in

Bangkok, for distribution to flood-hit people living in

Wat Tuk Community, Wat Bote and Phra Nangklao

Community, Nonthaburi Province, which were difficult

to access. The money for buying the survival bags

were donated by TBANK and member companies of

Thanachart Group as well as their executives and staff.

Annual Report 2011 Thanachart Bank Public Company Limited

65


Project supporting Thai Red Cross Society

still the only commercial bank with a booth in the Annual Red Cross Fair at Suan Amporn Park. The net income

gained from selling Red Cross lotteries as well as proceeds

• Participation in the Annual Red Cross

from the Bank’s participation in the fair were humbly

Fair

presented to H.R.H. Princess Maha Chakri Sirindhorn, Both TBANK and SCIB always participated in the

Annual Red Cross Fair. In 2011, the 35th anniversary fair

Executive Vice-President of the Thai Red Cross Society, annually for the benefit of the Thai Red Cross Society.

was held from 30 March to 7 April 2011 at Suan Amporn Park, under the theme entitled “On

84 th

• Blood donation in honor of the Royal

Birthday

Anniversary of Great King, follow His footsteps with Red

Father

Cross helping Thai people in honor of His Majesty the

This activity has been implemented by the

King”. The event was organized in celebration of the 84th

TBANK’s Khon Kaen Hub for seven consecutive years. The

Birthday Anniversary of His Majesty the King, the patron of

activity involves a campaign aimed at encouraging both

the Thai Red Cross Society. On this occasion, the Bank

members of the public and staff to donate blood in honor

humbly presented a donation of THB 5.2 million to benefit

of His Majesty the King. Donating blood not only helps

the Thai Red Cross Society as part of its participation in

save the lives of victims of emergent accidents but also

the Fair 2011 with Her Majesty Queen Sirikit as president

alleviate blood shortage during treatment. The activity has

of the Society.

been well supported by the Faculty of Medicine, Khon Kaen

Unviersity, who facilitates the blood donations. Moreover,

The participation in the annual fair could be traced

the Bank also gives financial health check-up to those who

back to the year 1976 when Bangkok Metropolitan Bank

participate in the activity. Tree seedlings are also

was invited to join the Red Cross Fair. It was the only

distributed to the participants, as part of the fight global

participating commercial bank at the fair, using the name

warming campaign. The objective is also to instill into

of ‘Bangkok Metropolitan Bank’s Booth’. Later in 2002

people cooperation in preserving the environment.

when Bangkok Metropolitan Bank merged with SCIB, SCIB

In 2011, 1,164 people donated 480,050 cc of blood to the

participated in the fair, using the name of ‘SCIB’s Booth’. In

Thai Red Cross Society.

2011 when SCIB merged with TBANK, their name at the

fair was changed to ‘Booth of TBANK and SCIB’. Today, it is

The first blood donation event took place in 2004

5

6

7

8

Pictures 5 - 6: Thanachart’s concern – motorcycle helmets for

kids, 84th birthday anniversary and 84 schools TBANK gave 20,000 helmets to student representatives

from 84 schools that participated in the project

named “Thanachart’s concern – motorcycle helmets

for kids, 84th birthday anniversary and 84 schools”.

The activity was part of the campaign aimed at

promoting safe driving habits. Pictures 7 - 8: Thanachart initiated and fulfilled Thai identity

project TBANK granted scholarships to the youths who won

the reading aloud contests and Thai manners contests.

Top winners were awarded H.R.H. Princess Maha

Chakri Sirindhorn’s Cups under the “Thanachart

initiates and fulfills Thai identity” project. First rounds

of the contests to select qualified candidates were

organized in four regions of the country. The

objective was to encourage Thai youths to preserve

their culture through the language and to learn

about correct ways of behaving in line with Thai

manners.

66

Annual Report 2011 Thanachart Bank Public Company Limited


with Khon Kaen Hub serving as a prototype for the blood

victims of the earthquake and Tsunami in Japan by opening

donation activity nationwide. This CSR activity has been

a bank account for customers nationwide to contribute to

organized twice annually on the occasions of the birthday

and making available collection boxes to accept donations

anniversaries of His Majesty the King and Her Majesty

from customers, staff and branches of the Bank. In this

Queen Sirikit respectively. Later, the coverage areas for the

connection, a total of THB 2,840,913.38 was donated and

event were extended to include those covered by

delivered to the Ministry of Foreign Affairs to help Japanese

Ayutthaya Hub, Nakhon Si Thammarat Hub, Saraburi Hub,

disaster victims.

Udon Thani Hub, Thon Buri Hub and Rajchadapisek Hub.

behind the project. The objective is also to encourage

• Thanachart joined hands to help disaster victims in the South The activities organized by Nakhon Si Thammarat

executives, staff, customers as well as members of the

Hub were aimed at helping victims who were adversely

general public to make merit together to help alleviate the

affected by floods. Survival bags were given to the victims

plight of fellow human beings in the case of emergencies

in Tambon Tonhong and the disaster evacuation centers in

or blood shortages.

Amphur Nop Pi Tum, Soi Pratu Kao Community, Tambon

The intention to do good deeds in honor of His Majesty

the King and Her Majesty Queen Sirikit is the inspiration

Groups of schools receiving continuous support from TBANK

Thepraj and Tambon Chalong, Amphur Sichon, Tambon Bang Rakam, Amphur Pakpanang, and the District Office of Amphur Pi Poon, Nakhon Si Thammarat Province. Surat Thanai Hub also gave survival bags and drinking water to

• Reuse Project entitled ‘Pi Chai Ngan

flood victims in Surat Thanai Province. As well, Phuket Hub

Nong Chai Rien’ (Senior use them for work, junior use them for learning)

gave assistance to flood victims in Tambon Khao Pranom,

The activity is based on the idea that materials can be reused. The TBANK reused structural materials and all decorative materials (such as desks, tables,

Amphur Khao Pranom, Krabi Province. • Thanachart joined hands to help flood

victims in 2011

bookshelves, educational materials and light bulbs) at its

Many provinces of Thailand including Bangkok

booths at Money Expo 2011 to build a multipurpose facility

were severely hit by recent devastating floods. The

and a library for Pak Dan Temple School in Sichon District,

disasters inflicted serious damage and caused a lot of

Nakhon Si Thammarat Province, which was adversely

people to suffer. As a result, the Bank and Thanachart

affected by southern floods. The Bank also provided the

Group organized activities aimed at helping the flood

school with sports equipment and school supplies to give

victims through a project named “Thanachart joins hands

moral support for the children education and shape the

to help flood victims in 2011”. The activities included

better future for them.

the following:

Projects to support disaster victims

1. TBANK opened a bank account using the name of “Thanachart joins hands to help flood victims in

These CSR activities are continuously implemented

2011”, to accept donations for flood victims. It used the

every year and place emphasis on rehabilitating victims

donated money to pay for 5,000 survival bags containing

affected by natural disasters. In 2011, TBANK gave

consumer goods worth THB 1,020,410.25 in total. The

assistance to victims of natural disasters through its

Bank teamed up with the Royal Thai Navy in distributing

various activities as follows:

the survival bags to flood victims in Wat Tuk Community,

Wat Bote and Phra Nangklao Community, Nonthaburi

• Thanachart Group members joined

Province. It also paid THB 973,905.83 for 5,000 medicine

hands to help Tsunami victims in Japan

sets together with boxes of cooked food. It also paid THB

The natural disasters that hit Japan hard in 2011

267,773.03 for 1,000 survival bags together with 1,000

represented a great tragedy that inflicted the heaviest

dozen bottles of drinking water. The Bank teamed up with

casualties and damage in the country for more than a

the Royal Thai Army in distributing them to flood victims in

century. Both TBANK and SCIB joined hands to help

the areas of Bang Plat, Taling Chan, Bang Yai, Bangbuathong, Don Muang, and Rangsit.

Annual Report 2011 Thanachart Bank Public Company Limited

67


2. Drinking water was distributed to flood

7. Thanachart Insurance Company Limited

victims at the temporary evacuation center inside Thammasat

made a financial contribution worth THB 100,000 to buy

University Rangsit Campus, Maha Chulalongkorn

survival bags for flood victims through the project named

Ratchawithayalai evacuation center in Wang Noi District in

‘Thanachart joins hands to help flood victims in 2011’.

Ayutthaya Province and the evacuation center at Valaya Alongkorn Rajabhat University under the Royal Patronage. Each center received 9,000 bottles of drinking water.

Project for Buddhism

Regiment (King’s Guards), the Security Forces Command,

• Activity to maintain and support Buddhism through the offering of ‘royal Kathin robes’

with financial assistance, an amount of THB 50,000 to buy

TBANK organizes annually the offering ceremony

3. The Bank provided the Security Forces

cleaning supplies for flood victims.

of Royal Kathin robes. In 2011, the Bank offered the Royal Kathin robes, graciously bestowed by His Majesty the King,

4. The Bank provided Wat-Sing Kindergarten in

to Wat Pa Pradu, Muang District, Rayong Province. In this

Chainat Province with 120 pairs of student desks and

connection, the Bank together with member companies of

chairs. In an effort to rehabilitate the kindergarten, the

Thanachart Group, their customers, trading partners,

Bank also helped repaint school fences and buildings to

executives, and staff as well as members of the general

make them look beautiful again. The objective was to

public jointly donated THB 7,977,422.27 in good faith to

enhance the quality of educational life. Moreover, in

the temple as part of the funds to be used for constructing

collaboration with Thanachart Foundation for Thai Society,

a new sermon hall.

the Bank plans to give additional pairs of student desks

and chairs in the first quarter of 2012 to about 20 schools

The offering ceremony of Royal Kathin robes,

which were hit by floods. A budget of about THB 6 - 7

graciously bestowed by His Majesty the King, was first

million is being allocated for this purpose.

organized in 2006. The Royal Kathin robes were offered to

Wat Keaw Gro Wa Ram Temple in Krabi Province. Since 5. Thanachart Securities Public Company

then, TBANK has been organizing the offering ceremony of

Limited made a financial contribution worth THB 100,000

Royal Kathin robes every year. The purpose of this CSR

to buy survival bags for flood victims, through the project

activity is to maintain and support Buddhism, royal

named “Thanachart joins hands to help flood victims in

temples, and sanctuaries so that they remain intact as

2011”. The company also provided TBANK’s CSR working

long as the nation exists. In addition, the Bank grants

group with 999 medicine sets worth THB 49,950. The

scholarships to financially needy students with good grades

money was donated by executives, staff and customers of

and good behavior.

Thanachart Securities Public Company Limited. The

medicine sets were distributed later to the flood victims.

6. Thanachart Life Assurance Company Limited made a financial contribution worth THB 700,000 to buy survival bags for flood victims. The survival bags were distributed to the victims through the Royal Thai Navy and the Royal Thai Army. As well, some of the company’s executives and staff volunteered to visit the flood-hit areas to distribute the bags themselves. The purpose was to alleviate the plight of flood victims under the project named “Thanachart joins hands to help flood victims in 2011”.

68

Annual Report 2011 Thanachart Bank Public Company Limited


RESPONSIBILITIES OF THE BOARD OF DIRECTORS FOR FINANCIAL REPORT

TBANK’s Board of Directors is responsible for the separated and consolidated financial statements and for financial information presented in this annual report. The aforementioned financial statements were prepared in accordance with the generally accepted accounting principles, applying appropriate and consistent accounting policies and with careful judgments and best estimates. Important information is adequately and transparently disclosed to TBANK’s shareholders and other investors in the notes to financial statements. TBANK’s Board of Directors has established and maintained appropriate and effective risk management and internal control system in order to rationally assure that the accounting information is correctly and completely recorded and adequate to sustain TBANK’s assets, as well as to prevent any material irregular operations or frauds. TBANK’s Board of Directors has appointed the Audit Committee comprising independent directors responsible for revision of accounting policies and the quality of financial statements, internal control, internal audit and risk management system, as well as the disclosure of related party transactions. The committee’s comments on these issues were included in the Audit Committee Report in this annual report. TBANK’s separated and consolidated financial statements were audited by the certified public accountant of Ernst & Young Office Limited. TBANK’s Board of Directors had provided the auditing team all information and document supports in order that the auditor would be able to audit and address his/her opinion to the auditing standards. The auditor’s opinion was included in the Report of independent Auditor in this annual report. TBANK’s Board of Directors is of the opinion that TBANK’s overall internal control is at a satisfying level and provides reliability on TBANK’s separated and consolidated financial statements for the year ended December 31, 2011 which is in compliance with the generally accepted accounting principles and relevant rules and regulations.

(Mr. Banterng Tantivit)

(Mr. Somjate Moosirilert)

Chairman

Chief Executive Officer and President

Annual Report 2011 Thanachart Bank Public Company Limited

69


Report of the Audit Committee

The Audit Committee of Thanachart Bank Public Company Limited consisted of three qualified and experienced

independent directors. The composition was as follows; 1. Mr. Kiettisak Meecharoen

Chairman of the Audit Committee

2. Assoc. Prof. Dr. Somjai Phagaphasvivathana Member of the Audit Committee 3. Mr. Sataporn Jinachitra Member of the Audit Committee Mrs. Vijitra Thumpothong, Executive Vice President, Audit, served as the secretary of the Audit Committee The Audit Committee was responsible for carrying out the duties as assigned by TBANK’s Board of Directors in line

with the regulations imposed by the Securities and Exchange Commission (SEC), notifications of the Stock Exchange of

Thailand (SET) and Bank of Thailand (BOT) as stated in the charter stipulated by the Board of Directors. In 2011, the Audit Committee convened 13 meetings in total with the management, top level executives of the related business units and auditors; whereas 11 meetings were regular meetings and 2 meetings were extraordinary meetings to acknowledge and consider numerous matters as of the following:

• Financial Statements The Audit Committee reviewed

the quarterly and year-end and consolidated financial statements of TBANK by

consulting with the external auditors and TBANK management in order to ensure the accounting standards, the accuracy of its significant matters, and the appropriate disclosure of information. In addition, the Audit Committee convened the meetings without the presence of TBANK management in order to ensure the independence of the auditors’ duties and comments.

• Internal Control and Internal Audit The Audit Committee reviewed the TBANK’s business to ensure an effective internal control and internal audit.

It provided consultation for the internal auditors in formulating the annual audit plan to ensure its sufficiency and

appropriateness of the auditors’ independence, The audit plan was monitored and evaluated quarterly. The professionals were engaged to assess and analyze an appropriateness of the organization structure, work force and capability of the internal auditors in order to further develop the effectiveness and efficiency of audit system.

70

Annual Report 2011 Thanachart Bank Public Company Limited


The

• Connected Transactions or Conflict of Interests The Audit Committee reviewed connected

• Regulatory Compliance Audit Committee reviewed the performance

of Compliance Unit’s to as certain that the Bank’s businesses

transactions and transactions where there might be conflict

were conducted in compliance with related rules and

of

regulations imposed by authorities such as the Bank of

appropriate disclosure of information before giving an

Thailand (BOT), Office of the Securities and Exchange

opinion to the Board of Directors.

interests

based

on

rationale,

transparency

and

Commission of Thailand (SEC), Stock Exchange of Thailand

(SET), the Office of Insurance Commission (OIC) and

The Audit Committee views that the Bank has

Anti-Money Laundering Office (AMLO). The Audit Committee

disclosed financial reports and financial statements properly

also acknowledged changes of any rules or regulations

and in accordance with the accounting standards. The

that affected operation and ensured the adjustment of

internal control, internal audit and risk management have

operation in response to those changes.

been appropriate, effective, and in compliance with laws

and regulations. Independent auditor was independent to

perform duties. Connected transactions and conflict of

• Risk Management

The

Audit Committee monitored and ensured

the adequacy of the Risk Management framework, The Committee met with executives in order to acknowledge the

Risk

Management

report

in

various

aspects

interests have been disclosed appropriately.

to

ensure an adequacy and effectiveness of TBANK’s risk management system.

(Mr. Kiettisak Meecharoen) Chairman of the Audit Committee

• Audit Committee’s charter

The

Audit Committee considered and approved

the amendment in the Audit Committee’s Charter to make it up-to-date and more appropriate.

• Independent Auditor The Audit Committee considered and approved

the qualification, the independence, performance and remuneration of the auditor. In addition, it also advised on the appointment and suitable remuneration of auditors to the TANK’s Board of Directors.

Annual Report 2011 Thanachart Bank Public Company Limited

71


Report of Independent Auditor

To the Shareholders of Thanachart Bank Public Company Limited I have audited the accompanying consolidated statement of financial position of Thanachart Bank Public Company Limited and its subsidiaries as at 31 December 2011, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the year then ended, and have also audited the separate financial statements

of Thanachart Bank Public Company Limited for the same period. These financial statements are the responsibility

of the management of the Bank and its subsidiaries as to their correctness and the completeness of the presentation.

My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with generally accepted auditing standards. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in

the financial statements. An audit also includes assessing the accounting principles used and significant estimates made

by management, as well as evaluating the overall financial statement presentation. I believe that my audit provides

a reasonable basis for my opinion. In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Thanachart Bank Public Company Limited and its subsidiaries and of Thanachart Bank Public Company Limited

as at 31 December 2011, and the results of their operations and cash flows for the year then ended in accordance with generally accepted accounting principles. Without qualifying my opinion on the aforementioned financial statements, I draw attention to Note 4 to

the financial statements. During the current year, the Bank and its subsidiaries adopted a number of revised and

new accounting standards as issued by the Federation of Accounting Professions, and applied them in the preparation

and presentation of the financial statements. The consolidated financial statements of Thanachart Bank Public Company Limited and its subsidiaries and the separate financial statements of Thanachart Bank Public Company Limited as at 31 December 2010 and for the year then ended were audited in accordance with generally accepted auditing standards by another auditor of our firm who expressed an unqualified opinion on those statements, under her report dated 24 February 2011. However, the Bank has restated the consolidated financial statements regarding the allocation cost of business combination from the purchase of investment in a subsidiary company within the period for measurement allowed by the related accounting standard as described in Note 2.3 to the financial statements. I have audited the adjustment and believed that it is correctly and appropriately recorded.

Phuphun Charoensuk

Certified Public Accountant (Thailand) No. 4950

Ernst & Young Office Limited Bangkok: 23 February 2012

72

Annual Report 2011 Thanachart Bank Public Company Limited


Statements of FINANCIAL POSITION Thanachart Bank Public Company Limited and its subsidiaries Statements of financial position As at 31 December 2011 and 2010 (Unit: Thousand Baht)

Note

Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2010

(Restated) Assets Cash

16,005,678

15,298,105

16,004,051

3,733,489

Interbank and money market items - net

8

63,201,206

85,060,091

62,963,184

28,427,950

Derivatives assets

9

1,536,490

3,117,370

1,532,331

927,751

Investments - net

10

148,344,800

140,021,676

114,540,693

49,758,732

11

1,423,339

2,177,314

40,841,867

73,121,367

675,021,253

639,320,239

654,451,435

358,727,116

962,799

923,792

924,925

272,080

675,984,052

640,244,031

655,376,360

358,999,196

(39,801,128)

(32,469,290)

(37,738,871)

(32,178,121)

13

(25,897,903)

(25,789,301)

(12,485,712)

(7,431,429)

14

(381,719)

(459,963)

(381,719)

(37,741)

Investments in subsidiary and associated companies - net Loans to customers and accrued interest receivables

12

Loans to customers Accrued interest receivables Total loans to customers and accrued interest receivables Less: Deferred revenue Allowance for doubtful accounts Revaluation allowance for debt restructuring Net loans to customers and accrued interest receivables Customers' liability under acceptances

609,903,302

581,525,477

604,770,058

319,351,905

90,531

72,156

90,531

-

Property foreclosed - net

16

6,761,904

7,850,667

3,653,106

639,782

Land, premises and equipment - net

17

8,758,841

8,986,185

8,365,341

1,690,163

Intangible assets - net

18

4,709,082

4,804,990

4,650,449

485,475

Goodwill

19

15,749,643

15,749,643

15,739,527

-

858,326

2,870,279

64,929

1,732,965

1,019,680

6,730

1,011,958

-

Receivables from purchase and sale of securities and derivatives Prepaid corporate income tax Reinsurance assets Other assets - net Total assets

20

2,573,393

532,773

-

-

5,123,388

5,129,331

3,825,298

2,193,641

886,059,603

873,202,787

878,053,323

482,063,220

The accompanying notes are an integral part of the financial statements.

Annual Report 2011 Thanachart Bank Public Company Limited

73


Statements of FINANCIAL POSITION (CONTINUED) Thanachart Bank Public Company Limited and its subsidiaries Statements of financial position (continued) As at 31 December 2011 and 2010 (Unit: Thousand Baht)

Note

Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2010

(Restated) Liabilities and equity Deposits

21

436,039,579

532,656,130

471,617,573

242,791,035

Interbank and money market items

22

60,150,845

40,544,594

59,282,708

29,705,720

2,130,716

3,126,945

2,130,716

2,326,457

Derivatives liabilities

Liability payable on demand 9

2,885,848

941,073

2,876,790

434,206

Debt issued and borrowings

23

254,296,521

174,948,957

257,503,221

132,092,201

90,531

72,156

90,531

-

24

2,823,534

899,690

2,620,953

113,284

851,388

4,053,940

267,638

1,733,060

Banks' liability under acceptances Provisions Payable from purchase and sale of securities and derivatives Insurance contract liabilities

25

36,154,060

29,773,671

-

-

Other liabilities

26

15,103,017

13,792,197

10,778,836

6,130,602

810,526,039

800,809,353

807,168,966

415,326,565

59,346,193

59,346,193

59,346,193

59,346,193

55,136,649

55,136,649

55,136,649

55,136,649

Total liabilities Equity Share capital

27

Registered 5,934,619,272 ordinary shares of Baht 10 each Issued and paid-up share capital 5,513,664,903 ordinary shares of Baht 10 each Share premium Other components of equity

2,100,694

2,100,694

2,100,694

2,100,694

28

612,902

1,147,783

211,106

169,512

29

989,326

655,945

989,326

655,945

16,008,739

13,141,827

12,446,582

8,673,855

74,848,310

72,182,898

70,884,357

66,736,655

685,254

210,536

-

-

Retained earnings Appropriated - statutory reserve Unappropriated Equity attributable to owner of the company Non-controlling interests of the subsidiaries Total equity Total liabilities and equity

75,533,564

72,393,434

70,884,357

66,736,655

886,059,603

873,202,787

878,053,323

482,063,220

-

-

-

-

The accompanying notes are an integral part of the financial statements.

Directors

74

Annual Report 2011 Thanachart Bank Public Company Limited


Statements of ComPREHENSIVE INCOME Thanachart Bank Public Company Limited and its subsidiaries Statements of comprehensive income For the years ended 31 December 2011 and 2010 (Unit: Thousand Baht except earnings per share expressed in Baht) Consolidated

Separate

financial statements Note

2011

financial statements

2010

2011

2010

Profit or loss Interest income

32

44,213,744

34,781,263

29,547,478

Interest expenses

33

(19,797,303)

(11,565,745)

(14,958,709)

(7,375,390)

24,416,441

23,215,518

14,588,769

14,022,068

3,857,939

3,368,918

2,904,042

2,030,464

Net interest income Fees and service income Fees and service expenses Net fees and service income

(499,958)

(518,588)

(144,272)

21,397,458

(45,055)

34

3,357,981

2,850,330

2,759,770

1,985,409

35

890,895

569,670

563,565

144,001

36

712,193

313,838

59,843

147,524 -

Gains on trading and foreign exchange transactions Gains (loss) on investments Share of profit from investments accounted for under equity method Insurance/Life insurance income Dividend income Brokerage fee from securities/derivatives Income on supporting service Other operating income Total operating income Insurance expenses Net operating income

156,064

206,711

-

12,853,319

11,186,879

-

-

707,542

461,284

1,590,458

575,941

1,167,668

1,407,762

-

-

44,708

55,984

1,062,319

278,092

1,430,155

1,239,248

1,135,592

868,822

21,760,316

18,021,857

45,736,966

41,507,224

(10,725,745)

(8,834,326)

35,011,221

32,672,898

21,760,316

18,021,857

10,735,944

8,458,418

6,626,964

3,855,982

43,223

44,866

26,888

17,891

3,474,246

3,148,053

1,833,460

1,531,862

898,439

618,432

406,770

181,826

6,725,454

4,553,979

4,776,988

3,142,638

21,877,306

16,823,748

13,671,070

8,730,199

2,504,008

2,148,604

1,421,636

1,279,692

10,629,907

13,700,546

6,667,610

(2,948,049)

(4,548,121)

7,681,858

9,152,425

6,667,610

(355,528)

688,370

41,594

(180,370)

204,123

-

(535,898)

892,493

41,594

10,044,918

6,709,204

-

Other operating expenses Employee's expenses Directors’ remuneration

37

Premises and equipment expenses Taxes and duties Other expenses Total other operating expenses Impairment losses of loans and debt securities

38

Profit before income tax Income tax

39

Profit for the year Other comprehensive income

-

8,011,966 (2,293,437) 5,718,529

40

Gains (losses) on changes in value of available-for-sale investments Share of other comprehensive income (loss) of associates Total other comprehensive income (loss) Total comprehensive income

7,145,960

(44,182) (44,182) 5,674,347

The accompanying notes are an integral part of the financial statements.

Annual Report 2011 Thanachart Bank Public Company Limited

75


Statements of ComPREHENSIVE INCOME (CONTINUED) Thanachart Bank Public Company Limited and its subsidiaries Statements of comprehensive income (continued) For the years ended 31 December 2011 and 2010 (Unit: Thousand Baht except earnings per share expressed in Baht) Consolidated

Separate

financial statements Note

financial statements

2011

2010

2011

2010

7,671,425

8,776,543

6,667,610

5,718,529

10,433

375,882

7,681,858

9,152,425

7,136,544

9,664,436

6,709,204

5,674,347

Profit attributable to: The Bank Non-controlling interests

Total comprehensive income attributable to: The Bank Non-controlling interests

Earnings per share of the Bank

9,416

380,482

7,145,960

10,044,918

1.39

1.92

1.21

1.25

5,513,664,903

4,562,521,270

5,513,664,903

4,562,521,270

41

Basic earnings per share Profit attributable to the Bank (Baht per share) Number of ordinary shares (shares)

The accompanying notes are an integral part of the financial statements.

76

Annual Report 2011 Thanachart Bank Public Company Limited


Statements of CASH FLOWS Thanachart Bank Public Company Limited and its subsidiaries Statements of cash flows For the years ended 31 December 2011 and 2010 (Unit: Thousand Baht) Consolidated

Separate

financial statements 2011

financial statements

2010

2011

2010

6,667,610

8,011,966

Cash flows from operating activities Profit before income tax

10,629,907

13,700,546

Adjustments to reconcile profit before income tax to net cash received (paid) from operating activities: Share of profit from investments accounted -

-

Depreciation and amortisation

for under equity method

1,715,216

1,309,796

768,191

573,110

Impairment losses of loans and debt securities

2,504,008

Increase (decrease) in provisions

(156,064)

(206,711) 2,148,604

1,421,636

1,279,692

(346,472)

102,912

1,195,615

2,569

364,504

561,197

(65,751)

(24,224)

Amortisation of premiums (discounts) on investment in debt securities

(69,123)

94,827

Gain from disposal of investments in subsidiary companies Gain from disposal of investment in an

(22,276)

-

-

(21,625) -

associated company Increase (decrease) in allowance for impairment of investments

(40,978)

(20,549)

4,463

(18,037)

49,226

6,065

1,825

3,428

443,562

(40,387)

29,079

13,762

Increase in allowance for change in value of investments Increase (decrease) in allowance for impairment of property foreclosed Increase (decrease) in allowance for impairment of land, premises and equipment

93,470

60

-

26,843

-

24,816

(1,190)

Increase in allowance for impairment of intangible asset

-

Interest income and other income from the assets transferred for debt repayment Loss (gain) on disposal of equipment

(1,967)

(16,618)

(1,967)

(16,618)

(7,923)

4,033

(2,632)

4,353

Loss from written-off of other assets

-

5,469

-

-

Gain from written-off of other liabilities

-

(9,315)

-

-

Unrealised (gain) loss on exchange

(1,536,625)

647,046

(1,536,625)

(153,991)

(2,011)

(57,982)

Decrease in allowance for impairment of other assets Increase in other income receivable Decrease in fees and rental received in advance Decrease in deferred income Increase (decrease) in accrued expenses Amortisation of discounts on long-term borrowings Net interest income Dividend income

(270,482)

(32,059)

(156,200)

(108,922)

(75,977)

(9,002)

(46,437)

(42,592)

(46,437)

(42,592)

(4,708) 1,077,288

(5,703) (142,045)

(4,708) 1,453,301

(5,699) 132,628

810

6,288

-

767

14,248,951

17,842,891

9,827,056

9,790,366

(24,781,755)

(23,783,003)

(14,519,646)

(14,117,662)

(707,542)

(461,284) 31,108,643

(1,590,458) 27,553,999

(575,941)

Cash received from interest income

40,114,752

19,673,174

Cash payment for interest expenses

(11,936,018)

(7,944,427)

(8,303,265)

(4,492,833)

Cash paid for corporate income tax

(3,555,117)

(4,331,947)

(1,970,980)

(2,432,349)

13,383,271

12,430,873

10,996,706

7,844,755

Income from operating activities before changes in operating assets and liabilities

The accompanying notes are an integral part of the financial statements. Annual Report 2011 Thanachart Bank Public Company Limited

77


Statements of CASH FLOWS (CONTINUED) Thanachart Bank Public Company Limited and its subsidiaries Statements of cash flows (continued) For the years ended 31 December 2011 and 2010 (Unit: Thousand Baht) Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2010

Decrease (increase) in operating assets Interbank and money market items Investments in trading securities Derivatives assets Loans and receivables

23,183,890

42,647,210

33,785,015

(12,792,593)

3,010,869

(4,780,207)

2,094,487

(680,785)

300,643

35,579,111 688,682 869,688

(22,441,973)

(50,543,824)

(52,904,541)

(49,502,317)

3,963,047

4,493,962

3,403,850

4,064,796

and derivatives

2,011,953

(1,602,244)

1,677,045

(1,423,075)

Reinsurance assets

(2,040,620)

(101,158)

-

Property foreclosed Receivables from purchase and sale of securities

Other assets

(220,462)

-

1,686,656

2,693,151

(431,483)

(96,616,551)

(41,943,638)

(27,141,638)

(23,936,288)

9,892,160

(22,028,919)

18,330,999

7,526,302

Increase (decrease) in operating liabilities Deposits Interbank and money market items Liability payable on demand Derivatives liabilities

(996,229)

120,125

(973,984)

214,645

652,276

245,789

661,248

(24,228)

Payable from purchase and sale of securities and derivatives Liabilities under insurance/ life insurance Other liabilities Net cash flows used in operating activities

(3,202,552)

2,298,262

6,380,389

4,217,902

(1,963,750) (78,713,257)

745,696 (45,003,224)

(1,465,422) (2,982,791) (18,399,926)

1,423,172 456,684 (16,649,556)

Cash flows from investing activities Cash payment for the entire business transfer

-

-

(39,253,886)

-

4,964,042

19,603,730

(10,547,385)

9,631,746

(59,291,064)

(2,681,425)

(68,835,299)

Decrease (increase) in investments in securities held for investment Cash paid for acquire investment in subsidiaries

(16,446)

Cash received from disposal of investments in subsidiary companies

366,304

212,756

-

212,766

113,750

-

-

-

-

-

16,922,510

4,671

4,533,638

4,301,842

1,984,309

1,803,609

824,488

602,433

1,590,487

576,466

(852,070)

(579,042)

39,767

17,713

(42,588)

(33,516)

Cash received from disposal of investment in an associated company Capital returned from a subsidiary Cash received from interest on investments Cash received from dividend Cash paid for purchase of equipment Cash received from disposal of equipment Cash paid for dividend to non-controlling interests Net cash flows from (used in) investing activities

9,930,885

The accompanying notes are an integral part of the financial statements.

78

Annual Report 2011 Thanachart Bank Public Company Limited

(35,165,148)

674,382

(262,296)

4,106

7,940

-

-

(31,306,902)

(56,860,397)


Statements of CASH FLOWS (CONTINUED) Thanachart Bank Public Company Limited and its subsidiaries Statements of cash flows (continued) For the years ended 31 December 2011 and 2010 (Unit: Thousand Baht) Consolidated

Separate

financial statements 2011

financial statements

2010

2011

2010

Cash flows from financing activities Cash received from issued additional share capital

-

35,790,456

-

35,790,456

1,181,760,489

525,897,163

990,764,061

460,836,327

(1,103,304,035)

(465,956,560)

(920,720,557)

(419,681,093)

Cash paid for interest from borrowings

(6,758,720)

(2,901,428)

(5,860,648)

(2,338,590)

Cash paid for dividend

(2,205,466)

(1,083,387)

(2,205,466)

(1,083,387)

Cash received from borrowings Cash paid for borrowings

Cash paid to non-controlling interests for capital refund Net cash flows from financing activities Net increase in cash

(2,323)

-

-

-

69,489,945

91,746,244

61,977,390

73,523,713

707,573

11,577,872

12,270,562

13,760

Cash at beginning of the year

15,298,105

3,720,233

3,733,489

3,719,729

Cash at end of the year

16,005,678

15,298,105

16,004,051

3,733,489

3,307,890

3,941,135

3,137,524

3,812,704

159,024

139,067

112,184

33,884

1,479,108

1,181,569

618,108

593,531

Supplemental cash flows information Non-cash transactions Transfer of properties foreclosed from receivables for debt settlement Accounts payable for purchase of fixed assets Bad debt written-off

The accompanying notes are an integral part of the financial statements.

Annual Report 2011 Thanachart Bank Public Company Limited

79


80 Annual Report 2011 Thanachart Bank Public Company Limited

STATEMENTS OF CHANGES IN EQUITY Thanachart Bank Public Company Limited and its subsidiaries Statements of changes in equity For the years ended 31 December 2011 and 2010 (Unit: Thousand Baht) Consolidated financial statements Other components of equity Surplus from

Share of

business

Surplus on

other comprehensive

fully paid-up

combination under

changes in value

income (loss)

Appropriated -

common control

of investments

of associates

statutory reserve

share capital

Share premium

Balance as at 1 January 2010

19,346,193

2,100,694

Increase in share capital (Note 27)

35,790,456

-

-

-

-

-

-

Dividend paid (Note 31)

Retained earnings

Issued and

(123,379)

Non-controlling

264,125

119,144

370,019

-

-

-

-

-

-

-

-

-

-

-

Unappropriated

interests

5,734,597 (1,083,387)

Total

60,691

27,872,084

-

35,790,456

-

(1,083,387)

Decrease in non - controlling interests of the subsidiaries

-

(230,637)

(230,637)

Transfer of retained earnings to statutory reserve (Note 29)

-

-

-

-

-

285,926

-

-

-

-

-

683,770

204,123

-

8,776,543

380,482

10,044,918

Balance as at 31 December 2010

55,136,649

2,100,694

(123,379)

947,895

323,267

655,945

13,141,827

210,536

72,393,434

Balance as at 1 January 2011 -

55,136,649

2,100,694

(123,379)

947,895

323,267

655,945

13,141,827

208,955

72,391,853

Total comprehensive income for the year

(285,926)

as previously reported The allocation of cost of business combination adjustment (Note 2.3) Balance as at 1 January 2011 - as restated

-

-

55,136,649

2,100,694

(123,379)

-

-

-

-

1,581

1,581

947,895

323,267

655,945

13,141,827

210,536

72,393,434

Cumulative effect of change in accounting policy for employee benefits (Note 4) Dividend paid (Note 31)

-

-

-

-

-

-

(2,265,666)

-

-

-

-

-

-

(2,205,466)

-

-

-

-

-

-

-

333,381

(6,472) -

(2,272,138) (2,205,466)

Increase in non - controlling interests of the subsidiaries

-

471,774

471,774

Transfer of retained earnings to statutory reserve (Note 29) Total comprehensive income for the year Balance as at 31 December 2011

-

-

-

-

-

-

55,136,649

2,100,694

The accompanying notes are an integral part of the financial statements.

(123,379)

(354,511)

(180,370)

593,384

142,897

-

-

-

7,671,425

(333,381)

9,416

7,145,960

989,326

16,008,739

685,254

75,533,564


STATEMENTS OF CHANGES IN EQUITY (CONTINUED) Thanachart Bank Public Company Limited and its subsidiaries Statements of changes in equity (continued) For the years ended 31 December 2011 and 2010 (Unit: Thousand Baht) Separate financial statements Other components of equity Issued and

Surplus on changes

fully paid-up share capital

Share premium

Balance as at 1 January 2010

19,346,193

2,100,694

Increase in share capital (Note 27)

Retained earnings

in value of

Appropriated -

investments

statutory reserve

Unappropriated

370,019

4,324,639

26,355,239 35,790,456

213,694

Total

35,790,456

-

-

-

-

Dividend paid (Note 31)

-

-

-

-

(1,083,387)

(1,083,387)

Transfer of retained earnings to statutory reserve (Note 29)

-

-

-

285,926

(285,926)

-

Total comprehensive income for the year Annual Report 2011 Thanachart Bank Public Company Limited

-

-

-

5,718,529

5,674,347

Balance as at 31 December 2010

55,136,649

2,100,694

169,512

(44,182)

655,945

8,673,855

66,736,655

Balance as at 1 January 2011

55,136,649

2,100,694

169,512

655,945

8,673,855

66,736,655

Cumulative effect of change in accounting policy for -

-

-

-

(356,036)

(356,036)

Dividend paid (Note 31)

employee benefits (Note 4)

-

-

-

-

(2,205,466)

(2,205,466)

Transfer of retained earnings to statutory reserve (Note 29)

-

-

-

333,381

(333,381)

-

Total comprehensive income for the year Balance as at 31 December 2011

The accompanying notes are an integral part of the financial statements.

-

-

41,594

-

6,667,610

6,709,204

55,136,649

2,100,694

211,106

989,326

12,446,582

70,884,357

81


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Thanachart Bank Public Company Limited and its subsidiaries Notes to consolidated financial statements For the years ended 31 December 2011 and 2010 1.

General information Thanachart Bank Public Company Limited (“Thanachart Bank” or “the Bank”) was incorporated as a public limited company under Thai laws and its parent company is Thanachart Capital Public Company Limited (herein after referred to as “the Parent company”), a public limited company also existing under Thai laws. The Parent company holds 50.96 percent of the Bank issued shares and Scotia Netherlands Holding BV, a company registered in Netherland, holds 49.00 percent of the Bank issued shares. The Bank’s registered address is 900, Tonson Tower, Ploenchit Road, Lumpini, Pathumwan, Bangkok. The Bank has 676 operational branches (2010: 256 operational branches). All subsidiaries are registered limited or public limited companies under Thai laws and operate their businesses in Thailand. The subsidiaries businesses include commercial bank, non-performing assets management business, securities business, leasing and hire purchase

business,

non-life

insurance

business,

life

insurance

business,

fund

management business and others. 2.

Thanachart Bank’s project to purchase Siam City Bank Plc.’s ordinary shares with the purpose of transferring Siam City Bank’s entire business to the Bank

2.1

The purchase of the ordinary shares of Siam City Bank Plc. from the Financial Institutions Development Fund On 11 March 2010, Thanachart Bank entered into a share purchase agreement with the Financial Institutions Development Fund (“FIDF”) to purchase 1,005,330,950 shares of Siam City Bank Plc. (“SCIB”), or 47.58 percent of the total issued and paid-up share capital, at a price of Baht 32.50 per share, or for total of Baht 32,673 million. On 9 April 2010, Thanachart Bank paid FIDF for SCIB’s shares, with the approval of the 2010 Annual General Meeting of the Bank’s shareholders, and the Bank of Thailand (“BOT”). The BOT also approved the Bank to hold the shares of SCIB in accordance with certain specified conditions, i.e. SCIB is to continue operating as commercial bank but has to return its banking license within 31 December 2011, the requirements on capital funds calculation, the structure of the financial business group, and holdings in companies in the financial business group.

82

Annual Report 2011 Thanachart Bank Public Company Limited

1


The Share Purchase Agreement between Thanachart Bank as “the Purchaser” and the FIDF as “the Seller”, dated 11 March 2010, states that the obligations, guarantees, liabilities or indemnities of the Seller to SCIB under any arrangements, agreements or documents in connection with the merger between SCIB and Bangkok Metropolitan Bank Public Company Limited (“BMB”) (the “Seller’s Obligations”) including funds deposited in accounts opened and maintained with SCIB to compensate for any losses or damages suffered or incurred by SCIB arising out of or in connection with the merger between SCIB and BMB will continue in full force and effect after completion of the sale and purchase of SCIB’s shares. Rights and obligations of SCIB related to the Seller’s Obligation, including funds deposited in the accounts opened and maintained with SCIB, will be transferred to and/or assumed by Thanachart Bank, with effect from the completion date of the entire business transfer from SCIB to Thanachart Bank. In addition, in case of the liquidation of the Seller, the Seller’s Obligations will be transferred and/or assumed by another government agency. 2.2

Additional tender offer for common shares of SCIB in 2010 During June 2010, Thanachart Bank made an additional tender offer to the minority shareholders of SCIB, at the same price as it paid to purchase shares of SCIB at auction from FIDF. Other shareholders sold 1,091,439,949 shares, or for a total of Baht 35,472 million, or 51.66 percent of the issued and paid-up shares of SCIB as a result of the tender offer, and combined with its existing holding, Thanachart Bank shareholding in SCIB reached 99.24 percent. During November 2010, Thanachart Bank acquired 14,907,658 additional shares of SCIB for a total of Baht 484 million, increasing its shareholding to 99.95 percent of the issued and paid-up shares of SCIB. The Stock Exchange of Thailand announced the voluntary delisting of SCIB’s shares on 13 December 2010.

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2.3

Allocating the cost of business combination Thanachart Bank acquired 47.58 percent of SCIB’s shares in April 2010 and on the same day, management of Thanachart Bank were assigned as directors of SCIB in a number that gave Thanachart Bank voting control over SCIB. Because Thanachart Bank had control over SCIB through shareholding and management, it has treated SCIB’s shares as investment in a subsidiary company since then. As a result of purchasing of additional shares to increase its shareholding in SCIB to 99.24 percent in June 2010 and 99.95 percent in November 2010, the total cost of investment in SCIB was Baht 68,801 million in the consolidated financial statements (including expenses in business combination and after deducting intercompany transactions). On 9 April 2010, Thanachart Bank’s management preliminarily estimated the fair value of each asset and liability of SCIB for the purpose of allocating the cost of business combination and recognised the difference between the cost of business combination and the fair value of assets, liabilities, contingent liabilities and intangible assets in proportion to its shareholding as goodwill from business combination in the consolidated financial statements. However, after the purchase, Thanachart Bank adjusted the estimated fair value of the assets and liabilities because of additional information that was received. This is in line with the related financial reporting standard that allows the purchaser to adjust the fair value for up to one year from the purchase date. The revised fair values of assets and liabilities are as follows: 1.

Assets and liabilities in SCIB and its subsidiaries’ accounts were valued and noted that the fair value of assets and liabilities as at investment payment date were totaled of Baht 48,635 million, which was Baht 4,264 million higher than book value.

2.

Intangible assets are assets that will generate future economic benefits. Thanachart Bank estimated the fair value of the intangible assets of SCIB at Baht 4,100 million, comprised of (a) Core Deposit Intangibles which are evaluated using the incremental cash-flows from low cost deposit, and considering the cost saving from current and saving deposits; and (b) Customer Relationships which are valued on the base of future revenues that will be earned from SCIB’s existing customers.

3.

For liabilities specify at acquisition date and contingent liabilities, Thanachart Bank estimated these and concluded that no additional contingent liabilities need to be recognised.

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Differences between the cost of business combination and the fair value of assets, liabilities, contingent liabilities and intangible assets in proportion to the shareholding, amounting to Baht 15,740 million, are recognised as goodwill from business combination in the consolidated financial statements. The Bank has retrospectively adjusted the comparative financial information in the previous year’s financial statements as if the accounting records for business combination had completed since the acquisition date. The fair value of the assets and liabilities of SCIB and its subsidiaries and the carrying value of each significant account as at the date Thanachart Bank assumed control over SCIB are as follow: (Unit: Million Baht) Fair value Book value Intangible assets

Previous balance

Revised

293

4,393

4,393

Other assets

435,702

437,016

439,966

Total liabilities

391,495

391,495

391,495

129

129

129

44,371

49,785

52,735

Cost of business combination

68,801

68,801

Goodwill

18,688

15,740

Non-controlling interests of the subsidiaries Net assets value

In allocating the purchase price, Thanachart Bank did not recognise deferred tax liabilities of Baht 2,466 million arising from the adjustment of assets to fair value (If the Bank recognised deferred tax liabilities on the date of business combination, the balance of such liabilities as at 31 December 2011 would be decreased to Baht 1,644 million, calculated using the tax rates enacted at the year-end date), and did not recognise the employee benefits of SCIB and its subsidiaries payable under labour law, amounting to Baht 1,804 million, since the two relevant accounting standards are not yet effective for the year of business combination. Since the fair value adjustment of assets and liabilities mentioned above and the recalculation of goodwill, Thanachart Bank has retrospectively adjusted the comparative financial information in the previous year’s financial statements as if the Bank has completely accounted for the business combination on the acquisition date, resulted in the following revisions to the consolidated comparative financial statements as of 31 December 2010:

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(Unit: Million Baht) 31 December 2010

31 December 2010

Before adjustment

After adjustment

137,959

140,022

Properties foreclosed

6,964

7,850

Intangible assets

4,805

4,805

18,698

15,750

209

210

Net investment

Goodwill Non - controlling interests of the subsidiaries

2.4

Key operation after the tender offer for SCIB’s shares in 2011 On 10 March 2011, BOT approved Thanachart Bank’s proposed plan for an entire business transfer of SCIB’s business to the Bank. The significant conditions of such approval are that SCIB must complete the entire business transfer and return the banking licenses and banking authorisations to the Ministry of Finance within 31 December 2011, and promptly proceed with the liquidation process, and that obligations between the Bank and FIDF are to comply with the Share Purchase Agreement dated 11 March 2010. On 7 April 2011, the 2011 Annual General Meeting of the Shareholders of SCIB and Thanachart Bank passed resolutions approving the transfer of SCIB’s entire business to Thanachart Bank, and the BOT has already approved this transaction. The Meetings also delegated the related authorities to SCIB’s Board of Directors and Thanachart Bank’s Board of Directors for further arrangement. On 30 June 2011, a meeting of the Bank’s Board of Directors passed a resolution to perform the entire business transfer from SCIB to the Bank on 1 October 2011 (EBT date). On 30 September 2011, Thanachart Bank entered into the Entire Business Transfer Agreement, legally effective on 1 October 2011, to transfer SCIB’s business to Thanachart Bank. The transferred business consisted of the assets, liabilities and commitment of SCIB as of 1 October 2011 and/or contingent liabilities that may arise in the future, with the parties agreeing a transfer price of Baht 50,134 million. The transfer price was set in accordance with the guidelines for setting transfer prices of financial assets among companies in the Thanachart group, and an independent financial advisor opined that it was fair value. SCIB recognised gain on the entire business transfer of Baht 5,299 million which has been eliminated in the consolidated financial statements.

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Significant guidelines of the transfer price of assets and liabilities are as follows: -

Loans: The transfer values were based on the outstanding loan balances net of related allowance for doubtful accounts.

-

Investments: The fair values of marketable securities were based on the latest bid price, the fair value of debt securities were determined using the yield rate quoted by the Thai Bond Market Association, and the fair values of other investments were determined from expected future cash flows, expected dividend to be received or net book value.

-

Property foreclosed: The fair values were based on the values appraised by independent appraisers in accordance with BOT guidelines, after deduction of a discount determined on the basis of past selling experience.

-

Deposit/debt issued and borrowings: Almost of deposits and short-term borrowings have floating interest rate and therefore the fair value is deemed to be closed to the book value. Long-term deposits and borrowings have interest yields that approximate market interest rate, and therefore fair value is deem to be closed to the book value.

-

Other assets/liabilities: The fair value approximates the book value.

-

Off-balance items and commitments under various exchange contracts are transferred at book value.

Significant assets and liabilities at the transfer date are as follow: (Unit: Million Baht) Interbank and money market items - net

67,649

Net investment

47,852

Loans to customer and accrued interest receivables - net

236,689

Property foreclosed

3,303

Land, premises and equipment

7,830

Other assets Deposits

17,754 255,968

Debt issued and borrowings

58,366

Other liabilities

16,609

Entire business transfer price - net

50,134

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Effective 1 October 2011, SCIB discontinued its operations. On 1 November 2011, the Board of Directors of SCIB passed a resolution to pay an interim dividend at Baht 7.50 per shares to its shareholders, totaling Baht 15,846 million. In November 2011, Thanachart Bank purchased additional shares of SCIB from the minority shareholders, to give those minority shareholders a chance to sell their shares before SCIB’ dissolution. Minority shareholders sold a total of 696,865 shares, at Baht 16 million, Thanachart Bank therefore holds 2,112,375,422 shares, or 99.98% of the total shares in issue. On 6 December 2011, the Extraordinary Meeting of SCIB’s shareholders approved the change of Siam City Bank’s name to “SCIB Plc.”. On 8 December 2011, SCIB returned its banking license and banking authorisations to the Ministry of Finance, and registered the change in its company’s name as “SCIB Plc.”. SCIB registered the company’s dissolution on 9 December 2011. 2.5

Transfer business of subsidiaries in the group Siam City Securities Co., Ltd. On 28 October 2010, the Boards of Directors of Thanachart Bank and SCIB passed resolutions to approve a plan for a business combination between Thanachart Securities Plc. (“Thanachart Securities”) and Siam City Securities Co., Ltd. (“SCIB Securities”), which is a subsidiary in the Group, by means of a partial business transfer of the assets of SCIB Securities to Thanachart Securities. The price of the transfer was to be not less than the book value, with reference to the latest adjusted book value before the transaction date. In November 2010, an extraordinary meeting of SCIB Securities’ shareholders approved the partial business transfer. On 30 December 2010, SCIB Securities entered into agreements to transfer assets relating to the securities business and obligations relating to the investment banking business, amounting to Baht 11 million, effective from 31 December 2010, while transfers of claims under agreements appointing an agent and/or broker for securities trading, including securities business receivables and payables with a net balance of Baht 206 million, and cash collateral for settlements amounting to Baht 216 million, were effective on 1 January 2011. SCIB Securities also transferred certain employees to Thanachart Securities on the same day. SCIB Securities temporary discontinue of its operations since 1 January 2011. The Annual General Meeting of the shareholders of SCIB Securities, held on 27 April 2011, approved the reduction of the registered and paid-up share capital of SCIB Securities from Baht 2,000 million to Baht 900 million. SCIB Securities registered the shares reduction on 7 June 2011.

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In August 2011, SCIB disposed investment in common shares of SCIB Securities at a price of Baht 168 million and recognised gains on the disposal of Baht 40 million in the consolidated financial statements of Thanachart Bank. This disposal was in accord with the approval by the Board of Directors of SCIB on 23 June 2011. Siam City Asset Management Co., Ltd. On 27 January 2011, the Board of Directors of SCIB passed a resolution to approve an offer to purchase and/or to sell shares of Siam City Asset Management Co., Ltd. to Government Pension Fund, a former shareholder. During May 2011, SCIB disposed all of its shares to the purchaser at a price of Baht 198 million and recognised gain on the disposal of Baht 26 million in the consolidated financial statements of Thanachart Bank. Siam City Bank Plc./ TS Asset Management Co., Ltd. During the year 2011, SCIB and TS Asset Management Co., Ltd. (“TS”) (The new company, which was licensed by the Bank of Thailand, set up to receive the transfer of SCIB’s non-performing assets including non-performing loans and property foreclosed, for further management) entered into an agreement to transfer rights in loan receivables and property foreclosed from SCIB to TS as follows: Fair value (Million Baht) -

Non-performing loans

9,062

-

Property foreclosed

3,083

The transfer of such financial assets was treated as a true sale in both financial statements of the transferee and the transferor since the transferor surrendered control over the assets. The selling prices were mutually agreed among companies in Thanachart Group with reference to what in the opinions of a financial advisor were fair values. Compensation for this transfer will be considered the fair value when recognising the selling price and the values of the transferred assets, which are as follows: -

For non-performing loans, the fair values are referred to the outstanding loan balance net of related allowance for doubtful accounts.

-

For property foreclosed, the fair values are referred to the value appraised by independent appraisers in accordance with the BOT guidelines, after deduction by an amount determined on the basis of past selling experience.

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Under the conditions of the agreement, the transferee is entitled to claim compensation if conditions specified in the agreement are breached within the specified period. However, gains (losses) from transfers of assets and the intercompany balances are eliminated when preparing the consolidated financial statements of Thanachart Bank because the transfers are intercompany transactions. Siam City Insurance Co., Ltd. On 27 July 2011, the Board of Directors of SCIB passed a resolution approving the disposal of investment in common shares of Siam City Insurance Co., Ltd. to other party. SCIB subsequently sold all the shares to purchasers on 19 August 2011 at a total price of Baht 113.75 million. 3.

Basis of preparation of the financial statements

3.1

Basis of preparation of the financial statements The financial statements have been prepared in accordance with accounting standard enunciated under the Accounting Professions Act B.E. 2547 with reference to accounting practice of “Transferring/Transferred of financial assets” and the principles stipulated by the Bank of Thailand (“BOT”). The presentation of the financial statements has been made in compliance with the BOT’s Notification relating to the preparation and format of the financial statements of commercial banks and holding company of financial business groups, dated 3 December 2010. Hence, the Bank reclassified certain items of the comparative financial statements. The financial statements in Thai language are the official financial statements of the Bank. The financial statements in English language have been translated from the Thai language financial statements. The financial statements have been prepared on a historical cost basis except where otherwise disclosed in the accounting policies.

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3.2

Basis of preparation of the consolidated financial statements a)

The consolidated financial statements included the financial statements of the Bank and the following subsidiary companies (“the subsidiaries”). Percentage of holding

Percentage of holding

by the Bank

by the subsidiaries

2011

2010

2011

2010

Subsidiaries directly held by the Bank SCIB Plc.

99.98

99.95

-

-

Thanachart Securities Plc.

100.00

100.00

-

-

Thanachart Insurance Co., Ltd.

100.00

100.00

-

-

Thanachart Life Assurance Co., Ltd.

100.00

100.00

-

-

75.00

75.00

-

-

Thanachart Broker Co., Ltd.

100.00

100.00

-

-

Thanachart Group Leasing Co., Ltd.

100.00

100.00

-

-

Thanachart Management and Services Co., Ltd.

100.00

100.00

-

-

Thanachart Legal and Appraisal Co., Ltd.

100.00

100.00

-

-

Thanachart Training and Development Co., Ltd.

100.00

100.00

-

-

TS Asset Management Co., Ltd.

100.00

-

-

-

65.18

-

-

-

100.00

-

100.00

100.00

-

-

-

99.79

100.00

-

100.00

100.00

-

-

-

60.00

100.00

-

100.00

100.00

(Formerly known as “Siam City Bank Plc.”)

Thanachart Fund Management Co., Ltd.

Ratchthani Leasing Plc. Subsidiaries indirectly held by the Bank National Leasing Co., Ltd. Siam City Securities Co., Ltd. Siam City Life Assurance Co., Ltd. Siam City Asset Management Co., Ltd. SCIB Service Co., Ltd.

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b)

Total assets and total income of the subsidiaries that have significant impact to and are included in the consolidated financial statements as at 31 December 2011 and 2010 and for the years then ended, after eliminating significant intercompany transactions, are as follows: (Unit: Million Baht) Total income for the year

Total assets 2011

2011

2010

-

406,974

9,044

9,945

Thanachart Life Assurance Co., Ltd.

20,402

19,917

1,964

1,471

Siam City Life Assurance Co., Ltd.

11,195

11,008

Thanachart Insurance Co., Ltd.

7,176

5,189

1,975

1,523

Thanachart Securities Plc.

3,877

3,958

1,377

1,357

TS Asset Management Co., Ltd.

11,361

-

296

-

Ratchthani Leasing Plc.

12,033

-

175

-

SCIB Plc.

c)

2010

(89)

482

The Bank has additionally invested in TS Asset Management Co., Ltd. which was newly set up during March 2011, and holds 100 percent.

d)

In October 2011, the Bank received the investments in 437,250,000 ordinary shares of Ratchthani Leasing Plc. from SCIB for Baht 536 million, in accordance with the terms of the entire business transfer agreement. As a result, the Bank’s interest in Ratchthani was 48.35 percent. On 1 November 2011, the Bank also purchased 437,486,500 additional shares at Baht 1.52 per share, or for a total of Baht 665 million, resulting in the Bank’s shareholding increasing to 65.18 percent of the total shares in issued. The investment was therefore treated as investment in subsidiary. Such purchase of additional ordinary shares is deemed to be a step acquisition. Under the Financial Reporting Standard, the Bank had to assess the value of the investment at equity held on the date before the business combination, using the fair value at the purchase date, and the Bank realised the gain of Baht 33 million in profit or loss in the statements of comprehensive income.

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Annual Report 2011 Thanachart Bank Public Company Limited


Amount (Million Baht) Fair value of investment at equity as at the purchase date before business combination

556

Less: Investment value at equity before business combination

(523)

Gain on revaluation of investment recognised in profit or loss

33

In addition, under the business combination, the Bank has to estimate the fair value of each asset and liability for the purpose of allocating the cost of business combination. The fair value of the assets and liabilities of Ratchthani Plc. (“THANI�) and the carrying value of each significant account as at the date the Bank obtained control over THANI is as follow: (Unit: Million Baht) Book value

Fair value

11,842

11,576

45

62

Other assets

1,502

1,512

Total liabilities

11,278

11,278

2,111

1,872

Loans Land, premises and equipment

Net assets value Cost of business combination

1,221

In allocating the purchase price, the cost of business combination does not differ from the net adjusted book value of the assets and liabilities at the purchase date, at the purchase portion, and thus no goodwill arose from this business combination. In addition, the Bank did not recognise deferred tax assets of Baht 72 million arising from the adjustment of assets to fair value since this accounting standard is not yet effective in the year of business combination. However, if the Bank had applied such standard on that date, deferred tax assets as at 31 December 2011 would be decreased to Baht 48 million (effect from the tax rates enacted at the year-end date). Therefore, the consolidated financial statements of the Bank included the statement of financial position of Ratchthani Leasing Plc. as at 31 December 2011, and the consolidated statements of comprehensive income included income and expenses from such company from 1 November 2011 (the date that Thanachart Bank assumed control) to 31 December 2011. The Bank recognised net loss from THANI totaling Baht 27 million from the date that the Bank assumed control based on its shareholding interest.

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For additional information to facilitate evaluation of the financial impact of the business combination, proforma consolidated total income and profit of the Bank and its subsidiaries for the year are presented below, inclusive of income and profit of Ratchthani Leasing Plc. as if business combination had occurred since the beginning of the year. (Unit: Million Baht) For the year ended 31 December 2011 Total income as if business combination occurred on 1 January 2011

66,947

Profit attributable to the Bank as if business combination occurred on 1 January 2011 (exclude elimination transactions before the purchase date)

e)

7,700

The consolidated statements of comprehensive income for the year ended 31 December 2010 include the operating results of SCIB and the subsidiaries held by SCIB from 9 April 2010 to 31 December 2010 because the Bank purchased the ordinary shares of SCIB and assumed control over SCIB in April 2010.

f)

In May 2011, SCIB disposed of investments in common shares of Siam City Asset Management Co., Ltd. to former shareholders for Baht 198 million. The gain on disposal of Baht 26 million was recognised in the consolidated financial statements. In addition in August 2011, SCIB disposed of investments in common shares of SCIB Securities Co., Ltd. for Baht 168 million, with gain on disposal of Baht 40 million recognised in the consolidated financial statements.

g)

The consolidated statements of comprehensive income for the year ended 31 December 2010 included the operating results of T Leasing Co., Ltd. from 1 January 2010 until 30 April 2010, the date of disposal of the investment, and the gain on such disposal of Baht 24 million was recognsied in the consolidated financial statements.

h)

All subsidiaries are fully consolidated as from the acquisition, being the date on which the Bank obtains control, and continue to be consolidated until the date when such control ceases. However, the consolidated statement of financial position as at 31 December 2010 and the consolidated statements of comprehensive income for the years ended 31 December 2011 and 2010 did not include the financial position and operating results of a subsidiary company, Chada Thong Properties Co., Ltd., in which the Bank has indirectly held by SCIB at 70 percent, because that subsidiary has ceased its operations and is in the process of being liquidated. SCIB has already made a full allowance for impairment in the value of its investment in that subsidiary. However, during the third quarter of 2011, SCIB sold out all of its investment.

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Annual Report 2011 Thanachart Bank Public Company Limited


i)

The financial statements of the subsidiaries are prepared for the same reporting period as the Bank, using the same significant accounting policies. In case where there are different accounting policies the Bank has adjusted the effect of these in the consolidated financial statements.

j)

The outstanding balances and significant intercompany transactions between the Bank and its subsidiaries have been eliminated from the consolidated financial statements. The investments in subsidiaries as recorded in the Bank’s and subsidiaries’ books of accounts have been eliminated against equity of the subsidiaries.

k)

Non-controlling interests represent the portion of profit or loss and net assets of the subsidiaries that are not held by the Bank and are presented separately in the consolidated statement of comprehensive income and within equity in the consolidated statement of financial position.

3.3

The separate financial statements, which present investments in subsidiary and associated companies under the cost method, have been prepared solely for the benefit of the public.

4.

Adoption of new accounting standards during the year During the current year, the Bank and its subsidiaries adopted a number of revised and new accounting standards, issued by the Federation of Accounting Professions, as listed below. Accounting standards: TAS 1 (revised 2009)

Presentation of Financial Statements

TAS 2 (revised 2009)

Inventories

TAS 7 (revised 2009)

Statement of Cash Flows

TAS 8 (revised 2009)

Accounting Policies, Changes in Accounting Estimates and Errors

TAS 10 (revised 2009)

Events after the Reporting Period

TAS 11 (revised 2009)

Construction Contracts

TAS 16 (revised 2009)

Property, Plant and Equipment

TAS 17 (revised 2009)

Leases

TAS 18 (revised 2009)

Revenue

TAS 19

Employee Benefits

TAS 23 (revised 2009)

Borrowing Costs

TAS 24 (revised 2009)

Related Party Disclosures

TAS 26

Accounting and Reporting by Retirement Benefit Plans 14

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TAS 27 (revised 2009)

Consolidated and Separate Financial Statements

TAS 28 (revised 2009)

Investments in Associates

TAS 29

Financial Reporting in Hyperinflationary Economies

TAS 31 (revised 2009)

Interests in Joint Ventures

TAS 33 (revised 2009)

Earnings per Share

TAS 34 (revised 2009)

Interim Financial Reporting

TAS 36 (revised 2009)

Impairment of Assets

TAS 37 (revised 2009)

Provisions, Contingent Liabilities and Contingent Assets

TAS 38 (revised 2009)

Intangible Assets

TAS 40 (revised 2009)

Investment Property

Financial reporting standards: TFRS 2

Share-Based Payment

TFRS 3 (revised 2009)

Business Combinations

TFRS 5 (revised 2009)

Non-current Assets Held for Sale and Discontinued Operations

TFRS 6

Exploration for and Evaluation of Mineral Resources

Financial Reporting Standard Interpretations: TFRIC 15

Agreements for the Construction of Real Estate

Accounting Standard Interpretations: SIC 31

Revenue-Barter Transactions Involving Advertising Services

These accounting standards do not have any significant impact on the financial statements for the current year, except for TAS 19 “Employee Benefits�. TAS 19 Employee Benefits This accounting standard requires employee benefits to be recognised as expense in the period in which the service is performed by the employee. In particular, an entity has to evaluate and make a provision for post-employment benefits using actuarial techniques. The Bank and its subsidiaries previously accounted for such employee benefits when they were incurred.

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The Bank and its subsidiaries have changed this accounting policy in the current year and recognise the liability in the transition period through an adjustment to the beginning balance of retained earnings in the current year. The change has the effect of decreasing the beginning balance of retained earnings of the Bank and its subsidiaries by Baht 2,266 million (Separate financial statements: decreasing retained earnings by Baht 356 million). The cumulative effect of the changes in accounting policy has been presented in “Cumulative effect of change in accounting policy for employee benefits” in the statements of changes in equity. In addition, the change has the effect of decreasing the profit of the Bank and its subsidiaries for the year ended 31 December 2011 by Baht 184 million, or Baht 0.033 per share (Separate financial statements: decreasing profit by Baht 50 million or Baht 0.009 per share). 5.

New accounting standards issued during the year not yet effective The Federation of Accounting Professions issued the following new/revised accounting standards that are effective for fiscal years beginning on or after 1 January 2013. Accounting standards: TAS 12

Income Taxes

TAS 20 (revised 2009) Accounting

for

Government

Grants

and

Disclosure

of

Government Assistance TAS 21 (revised 2009) The Effects of Changes in Foreign Exchange Rates Accounting Standard Interpretations: SIC 10

Government Assistance - No Specific Relation to Operating Activities

SIC 21

Income Taxes - Recovery of Revalued Non-Depreciable Assets

SIC 25

Income Taxes - Changes in the Tax Status of an Entity or its Shareholders

The Bank and its subsidiaries’ management believe that these accounting standards will not have any significant impact on the financial statements for the year when they are initially applied, except for TAS 12 “Income Taxes”.

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TAS 12 Income Taxes This accounting standard requires an entity to identify temporary differences, which are differences between the carrying amount of an asset and liability in the accounting records and its tax base, and to recognise deferred tax assets and liabilities under the stipulated guidelines. At present, the management of the Bank and its subsidiaries is evaluating the impact on the financial statements in the year when this standard is adopted. 6.

Significant accounting policies

6.1

Revenue recognition a)

Interest and discounts on loans Interest on loan is recognised as income on an accrual basis, based on the amount of principal outstanding. Interest on hire purchase and financial lease is recognised on the effective interest rate. For loans on which principal or interest payments have been defaulted for more than three months past the due date, the Bank and its subsidiaries cease accrual of interest income, and accrued interest already recorded is reversed from the Bank and its subsidiaries’ accounts. Interest is then recognised as income on a cash basis until settlement of such overdue balance has been received from the debtors. Interest income on restructured loans is recognised as income on an accrual basis, with reference to the interest rate stipulated in the agreements, with the exception of interest on loans that are subject to monitoring for compliance with restructuring conditions, which the Bank and its subsidiaries recognise as income on a cash basis until the receivable is able to comply with the restructuring conditions for a period of no less than three months or three installments, whichever is longer. The Bank and its subsidiaries recognise interest income on investments in purchased/transferred loans for which loan repayment is received during the year based on the effective yield rate of the portfolio by the new book value (acquisition cost) of the outstanding balances of receivables. After the restructuring, interest income is recognised by the effective interest rate method for those receivables from which loan repayment was received during the year.

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Interest or discounts already included in the face value of notes receivable or loans are recorded as deferred interest and taken up as income evenly throughout the term of the notes or loans or in proportion of debt repayment. Interest income received in advance on hire purchase represents discounted on interest given to debtors by dealers, is recognised based on the effective interest method, in the same manner as interest income on hire purchase receivables. b)

Interest and dividends on investments Interest on investments is recognised as income on an accrual basis based on the effective interest rate. Dividends are recognised as income when the right to receive the dividends is established.

c)

Brokerage fee income Brokerage fees on trading of securities and derivatives are recognised as income on the transaction date.

d)

Interest on margin loans for purchase of securities Interest on margin loans for purchases of securities is recognised as income over the term of the loans based on the amount of principal outstanding. The subsidiary companies cease accruing interest for certain loans that fall under the conditions set by the Securities and Exchange Commission (“SEC�).

e)

Gains (losses) on investments and derivatives Gains (losses) on investments and derivatives are recognised as income/ expenses on the transaction date.

f)

Fees and service income Fees and service income are recognised as income on an accrual basis.

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99


g)

Insurance/life insurance premium income Non-life insurance business Insurance premium income on insurance policies is recognised on the date the insurance policy comes into effect, after deducting premium ceded and refunded for insurance policies with coverage periods of up to 1 year. For long-term insurance policies with coverage periods of longer than 1 year, related revenues and expenses are recorded as unearned and prepaid items, and amortised to income and expenses over the coverage period. Insurance premium income is recognised after deducting unearned premium reserve. Reinsurance premium income is recognised when the reinsurer places the reinsurance application or statement of accounts. Life insurance business Premium income is recognised as income on the date the insurance policy comes into effect, after deducting premium ceded and refunded. For renewal policy, premium income is recognised as income when the premium is dued, only if the policy is still in force at the year-end date.

6.2

Expenses recognition a)

Interest expenses Interest expenses are charged to expenses on an accrual basis. Interest on notes payable included in the face value is recorded as deferred interest and amortised to expenses evenly throughout the term of the notes.

b)

Commission and expenses charged on hire purchase/financial leases For hire purchase/financial lease contracts originating on or after 1 January 2007, initial direct expenses at the inception of a hire purchase/financial lease contract (i.e. commission expenses and stamp duty expenses) are to be deferred and amortised using the effective interest method, with amortisation deducted from interest income throughout the contract period, in order to reflect the effective rate of return on the contracts. Unearned income on hire purchase/financial leases is presented net of commission expenses and initial direct cost on the inception of the contracts.

c)

Fees and service expenses Fees and service expenses are recognised as expenses on an accrual basis. 19

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6.3

Investments Investments in securities held for trading are stated at fair value. Changes in the fair value of the securities are recorded in profit or loss in the statements of comprehensive income. Investments in available-for-sale securities are stated at fair value. Changes in the fair value of these securities are recorded in other comprehensive income in the statements of comprehensive income, and will be recognised in profit or loss when the securities are sold. Investments in held-to-maturity debt securities are recorded at amortised cost. Premiums/discounts on debt securities are amortised/accreted by the effective rate method with the amortised/accreted amount presented as an adjustment to the interest income. Investments in non-marketable equity securities, which are classified as other investments, are stated at cost net of allowance for impairment (if any). The Bank and its subsidiaries do not treat investments in mutual funds, in which they hold not less than 20 percent of the units issued, as investments in subsidiary or associated companies because the Bank and its subsidiaries do not have control or influence over the financial and operating policies of these funds, which are independently managed by the fund manager in accordance with the details of each fund project and are under the supervision of the Securities and Exchange Commission. The fair value of marketable securities is based on the latest bid price of the last working day of the year. The fair value of debt securities is determined using the yield rates quoted by the Thai Bond Market Association, other markets, or yield rate of government bond adjusted by an appropriate risk factor. The fair value of unit trusts is determined from their net asset value. The fair value of investments which have embedded derivatives was determined using an internal model because there is no active market. (2011: the fair value was determined using the fair value as estimated by the seller). The gains/losses arising from revaluation are recognised in profit or loss. This method of measurement is in compliance with the principles stipulated by the BOT. The Bank and its subsidiaries recognised loss on impairment (if any) of available-for-sale securities, held-to-maturity debt securities and other investments in part of profit or loss in the statements of comprehensive income.

20

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In the event of the Bank and its subsidiaries’ transfer investments to another category, the investments are valued at their fair valued prevailing on the transfer date. Differences between the carrying amount of the investments and their fair value on that date are recorded as profit or loss in the statements of comprehensive income or surplus (deficit) from revaluation of investments, which is presented as a separate item in equity and amortised over the remaining period to maturity of the debt securities, depending on the type of investment which is reclassified. On disposal of an investment, the difference between net disposal proceeds and the carrying amount of the investment is recognised as income or expenses in part of profit or loss in the statement of comprehensive income. In case of disposal partial of the investment, the carrying value per share used to calculate the cost of the portion sold is determined using the weighted average method. 6.4

Investments in receivables purchased and allowance for impairment Investments in receivables purchased are presented at their acquisition cost net of allowance for impairment (if any). Loss on impairment is recognised as an expense in part of profit or loss in the statements of comprehensive income. In case that the receivables purchased enter into troubled debt restructuring agreements, they are transferred to loans and presented at fair value. The fair value is determined based on the outstanding balance of investments as at the transfer date or as at the date of restructuring. Allowance for impairment of investments in receivables purchased is determined based on the fair value, with reference to the collateral value.

6.5

Investments in subsidiary and associated companies Investments in subsidiary and associated companies in the separate financial statements are accounted for under the cost method net of allowance for impairment

(if any). Loss

on impairment is recognised as expenses in part of profit or loss in the statements of comprehensive income.

21

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Investments in associated companies in the consolidated financial statements are accounted for under the equity method. Under this method, investments are initially recorded at acquisition cost and are adjusted to reflect the attributable shares of the net income from the operations of the associated companies, in proportion to the investment. 6.6

Loans Loans are stated at the principal balances, excluding accrued interest receivable, except for overdrafts which are presented at the principal balances plus accrued interest receivable. Unrecognised deferred income and discounts on loans are deducted from the loan balances. Hire purchase receivables and financial lease receivables are stated at the contract value of the hire purchase receivables and financial lease receivables net of unearned income, which is presented after netting commission expenses and initial direct cost on the inception of the contracts. Securities and derivatives business receivables comprise the net balances of securities business receivable and derivatives business receivables. Securities business receivable comprises receivable balances of credit balance accounts (for which the securities purchased are used as collateral), securities borrowing and lending receivables and guarantee deposit receivables (which comprise cash placed as guarantee for borrowers of securities or Thailand Securities Depository) as well as other receivables, such as overdue amounts in cash accounts and securities receivables which are under legal proceedings, are undergoing restructuring, or are being settled in installments. The receivable balance of cash accounts is presented as “Receivable from purchase and sale of securities and derivatives�.

6.7

Allowances for doubtful accounts a)

The Bank and its subsidiary companies that operate in banking and asset management business provide allowance for doubtful accounts in accordance with the Notifications of the BOT and adjust these by the additional amount which is expected not to be collectible based on an evaluation of the current status of the debtors, taking into consideration the recovery risk and the value of collateral. Increase (decrease) in an allowance for doubtful accounts is recognised as an expense during the year.

22

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The Bank and its subsidiary companies set provision for normal loans (including restructured receivables) and special mention loans at minimum rates of 1% and 2%, respectively, of the loan balances (excluding accrued interest receivable) net of collateral value, as required by the BOT’s guidelines. Collateral values include values of vehicles under hire purchase and finance lease contracts. For nonperforming loans, provision is set at a rate of 100% of the debt balance remaining after deducting the present value of expected future cash flows from debt collection or the present value of expected cash flows from collateral disposal, based on the use of a discount rate and assumptions as to the time needed to dispose of the collateral, in accordance with the BOT’s guideline. However, non-performing hire purchase receivables and financial lease receivables are treated as uncollateralised. b)

Subsidiaries engaged in securities business have provided an allowance for doubtful accounts based on a review of debtors’ repayment capability, taking into consideration the risk of recovery and the value of collateral. An allowance is set aside for doubtful debts not fully covered by collateral and/or those which may not be fully recovered. Such debt classifications and provisions are made in accordance with the Notifications of the SEC.

c)

Subsidiaries engaged in hire purchase and leasing businesses have provided allowance for doubtful accounts at percentages of the amount of principal outstanding net of unearned income, based on the number of months overdue (with reference to the classification of loans under BOT’s guidelines). Allowance for doubtful accounts is provided based on the loan balances after net of collateral value for receivables overdue no more than 3 months, while provided based on the loans balance without deducting collateral value for receivables overdue more than 3 months.

d)

Allowance for doubtful accounts of other receivables is based on the amount of debt that may not be collectible, determined from a review of the current status of the receivables as at the financial reporting date.

e)

The Bank writes off hire purchase receivables when full allowance for doubtful accounts has been made for such receivables. For other loans, the Bank and its subsidiaries will be written off when the relevant criteria under tax law are met. Amounts written off as bad debts or bad debt recovery are deducted from or added to the allowance for doubtful accounts.

23

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Annual Report 2011 Thanachart Bank Public Company Limited


6.8

Troubled debt restructuring In cases where the debt restructuring involves modifications of the terms, the fair value of the receivables after restructuring is based on the net present value of expected future cash flows, discounted by the market’s minimum interest rate for credit to large customers as at the date of the debt restructuring. The differences between the fair values of receivables as of the restructuring date and their previous book values is recorded in “Revaluation allowance for debt restructuring”, and recognised as an expense in part of profit or loss in the statements of comprehensive income in the restructuring period. The Bank and its subsidiaries review such revaluation allowance based on the net present value of future cash flows over the remaining period to maturity, recognising adjustments against bad debt and doubtful accounts. In cases where the troubled debt restructuring involves the transfer of assets or equity, the Bank and its subsidiaries record the assets or equity interest received as a result of debt restructuring at their fair value (based on the value appraised by internal appraisers or external independent appraisers) providing this does not exceed the amount of principal legally claimable from the debtor (including interest of which recognition has ceased until the restructuring date). Any excess of the fair value of the assets over the book value is recognised as interest income in part of profit or loss in the statement of comprehensive income. Losses arising from debt restructuring through waivers of part of principal or recorded accrued interest receivable are recognised in part of profit or loss in the statement of comprehensive income when incurred.

6.9

Recognition and amortisation of customers’ assets Assets which customers have placed with the subsidiary companies for securities trading, in term of cash accounts and credit balance accounts, including amounts which customers have placed as security for derivative trading, are recorded as assets and liabilities of the subsidiary companies for internal control purpose. As at the reporting date, the subsidiary companies write off those amounts which there are no guarantee obligations from both assets and liabilities and present only those assets which belong to the subsidiary companies.

24

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6.10 Property foreclosed Property foreclosed is stated at the lower of cost (fair value with reference to appraisal value, providing this does not exceed the legally claimable amount of debt) or net realisable value, which is determined with reference to the latest appraisal value less estimated selling expenses, adjusts these in accordance with the BOT’s guideline and taking into consideration the type and the nature of the assets. Gains on disposal of property foreclosed are recognised in part of profit or loss in the statements of comprehensive income on the disposal date, unless the purchase is made with a loan from the Bank. In such cases, gains are recognised in accordance with the BOT’s guideline. Losses on disposal and impairment losses are recognised as expenses in part of profit or loss in the statements of comprehensive income. 6.11 Land, premises and equipment and depreciation a)

Land and assets under installation are stated at cost, and depreciation is not provided.

b)

Premises and equipment are stated at cost less accumulated depreciation and allowance for impairment (if any). Depreciation is calculated by reference to their cost on a straight-line basis over the following estimated useful lives: Buildings

-

20 - 30

years

Buildings improvement

-

5 - 10

years

Furniture, fixtures and equipment

-

3 - 10

years

Motor vehicles

-

5

years

Depreciation is included in determining income. c)

Land, premises and equipment are derecognised upon disposal or when no future economic benefits are expected from their use. Any gain or loss arising on disposal of these assets (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in profit or loss in the statements of comprehensive income.

6.12 Intangible assets and amortisation Intangible assets acquired through business combination are initially recognised at their fair value on the date of business acquisition while intangible assets acquired in other cases are recognised at cost. Following the initial recognition, the intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses (if any).

25

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Annual Report 2011 Thanachart Bank Public Company Limited


The Bank and its subsidiaries amortised intangible assets with finite lives on a systematic basis over the economic useful life and tested for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method of such intangible assets are reviewed at least at each financial year end. The amortisation expense and loss on impairment are recognised as expenses in part of profit or loss in the statements of comprehensive income. The intangible assets with finite useful lives have useful lives of approximately 3 - 10 years. No amortisation for computer software under development. 6.13 Leasehold rights Leasehold rights are stated at cost less accumulated amortisation. Leasehold rights are amortised on a straight-line basis over the lease periods and the amortisation amounts are recognised as expenses in part of profit or loss in the statements of comprehensive income. 6.14 Business combination and goodwill Business combination accounted for under purchase method. Goodwill is initially recorded at cost, which equals the excess of the cost of business combination over the fair value of the net assets acquired. Goodwill is carried at cost less any accumulated impairment losses. Goodwill is tested for impairment annually and when circumstances indicate that the carrying value may be impaired. 6.15 Receivables from/payable to Clearing House Receivables from/payable to Clearing House comprises the net balance receivable/ payable in respect of securities and derivatives trades. These include amounts pledged with the Derivatives Clearing House as security for derivatives trading.

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6.16 Securities purchased under resale agreements/securities sold under repurchased agreements The Bank and its subsidiaries enter into agreements with private entities to purchase/sell securities whereby there is an agreement to resell/repurchase the securities at certain dates and at fixed price. Amounts paid for the securities purchased are presented as assets under the caption of interbank and money market items or loans, depending on the counter party, and the underlying securities are treated as collateral to such receivables. The securities sold under repurchase agreement at the amounts received are presented as liabilities under the caption of interbank and money market items and the underlying securities are treated as collateral. 6.17 Premium due and uncollected and allowance for doubtful accounts Premium due and uncollected is carried at its net realisable value. Subsidiary companies provide an allowance for doubtful accounts based on the estimated loss that may be incurred in the collection of the premium due, on the basis of collection experience and a review of current status of the premium due as at the financial reporting date. 6.18 Reinsurance assets and liabilities Reinsurance assets represent balances due from reinsurance companies, deposits placed for reinsurance and insurance reserve to recover from reinsurers. Insurance reserve to recover from reinsurers are estimated in a manner consistent with the outstanding claims provision or settled claims associated with the reinsurer’s policies, and are in accordance with the related reinsurance contracts. Reinsurance liabilities represent balances due to reinsurance companies and deposits for reinsurance held by the subsidiaries. The amounts payable on reinsurance are estimated in a manner consistent with the related reinsurance contracts.

27

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Annual Report 2011 Thanachart Bank Public Company Limited


6.19 Unearned premium/life insurance premium reserve Non-life insurance contract The subsidiaries set up gross unearned premium reserve in accordance with the followings: Marine and transportation (cargo)

-

Net premium written for the last ninety days

Traveling accident with coverage of not more

-

than 6 months Others

Net premium written for the last thirty days

-

Monthly average basis (the one-twenty fourth basis)

In 2011, the Office of the Insurance Commission (“OIC�) has required that insurers allocate an additional gross unexpired risk reserve in an amount not less than the difference between gross unexpired risk reserve and unearned premium reserve, in cases where gross unexpired risk reserve is higher than unearned premium reserve. Gross unexpired risk reserve is calculated based on an actuarial method using a best estimate of expected claims over the remainder of the insured period, based on historical data. Life insurance contract Life assurance policy reserve represents the accumulated total liabilities for estimated future claims under all policies in force as at the financial statement date. Subsidiaries determine life assurance policy reserve under long-term policies by using the higher of the net level premium valuation method (NPV) and the gross premium valuation method (GPV). Life assurance policy reserve under NPV method is a type of actuarial method with the main assumptions used relating to mortality rate, morbidity rate, longevity and discount rates. Calculation of life assurance policy reserve under GPV method is another type of actuarial method with main assumptions used relating to lapse rate or surrender rate, selling and administrative expenses, mortality and morbidity rate, discount rates and non-guaranteed dividend rate. This calculation method is in compliance with the bases stipulated in the OIC’s notification regarding valuation of assets and liabilities of life insurance company (2011).

28

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6.20 Loss reserve and outstanding claims/Benefits payment to life policy Non-life insurance contract Outstanding claims are recorded at the actual amount to be paid. Loss reserve is recorded upon the receipt of the claims advice from the insured based on the number of claims notified by the insured and estimates made by a subsidiary’s management. The estimated value of losses is limited to not more than the sum insured of the related insurance policies. In addition, in 2011, the OIC changed the method to be used for setting additional reserve for incurred but not reported (IBNR) claims. The reserve is calculated using an international standard actuarial method, based on the best estimated of claims expected to be paid in the future for losses occurring before or as at the financial statement date, including both reported and unreported claims, net of loss reserve already recorded (Formerly, the subsidiary set up additional provision for IBNR at the higher of the reserve calculated using actuarial method minus the recorded amount or outstanding claims, and 2.5 percent of total net premiums written in the previous twelve months). Life insurance contract Benefits paid under life policies are provided for upon receipt of the claims advices from the insured or in accordance with the conditions of the policy. 6.21 Long-term leases Leases that transfer substantially all the risks and rewards of ownership to the Bank and its subsidiaries are classified as financial leases. Financial leases are capitalised at the lower of the fair value of the leased assets and the present value of the minimum lease payments. The outstanding rental obligations, net of finance charges, are included in other payables, while the interest element is charged to profit or loss in the statement of comprehensive income over the lease period. Assets acquired under finance leases are depreciated over their estimated useful lives. Lease not transferring a significant portion of the risks and rewards of ownership to the lessee are classified as operating leases. Advance payments made under operating leases is recorded as leasehold rights, and then amortise as expenses over the term of the leases on the straight - line basis. Moreover, payments made under operating leases are recognised as expenses over the term of the leases on the straight-line basis.

29

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Annual Report 2011 Thanachart Bank Public Company Limited


6.22 Sales of commercial paper The Bank and its subsidiary company which operates in banking business recorded commercial paper with an aval by the Bank, or without an aval or acceptance which is sold with recourse, as a liability under the caption of “Liabilities under commercial paper sold”. Commercial paper sold at a discount with recourse, which is avaled by or has acceptance from a commercial bank or other finance company, is recorded by crediting the notes receivable account, and the obligations disclosed as part of “Contingent liabilities”. 6.23 Financial derivatives The Bank and its subsidiaries have entered into off-balance transactions involving derivative financial instruments in order to manage risk of the Bank and its subsidiaries and in response to customer needs. Forward foreign currency contracts which originated for trading purposes are recorded as off-balance items. Gains or losses arising from changes in the fair value of the contracts are recognised as part of profit or loss in the statement of comprehensive income. Forward foreign currency contracts, interest rate swap contracts and cross currency and interest rate swap contracts which were not originated for trading purposes are recorded as off-balance items, and presented on an accrual basis. Foreign currency components are translated at the year-end exchange rate, in the same manner as the hedged items, with unrealised gains or losses on translation recognised as part of profit or loss in the statement of comprehensive income. Interest rate components are presented on an accrual basis, in the same manner as the hedged assets or liabilities, with gains or losses recorded to interest income and interest expense over the terms of the contracts. Receivables and payables under exchange contracts are presented at the net amount in the statement of financial position. The subsidiaries record obligations in respect of futures contracts made for trading purposes as off-balance items. Gains or losses from changes in the fair value of financial derivatives contracts are recorded in profit of loss. Fair value is determined based on the daily settlement price quoted by Thailand Futures Exchanges Public Company Limited. If the fair value of financial derivatives cannot be determined with reference to market price, it is determined by a technical and valuation model, in which the variables used, will be derived from the observable markets.

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6.24 Related party transactions Related parties comprise enterprises and individuals that control, or are controlled by, the Bank and its subsidiaries, whether directly or indirectly, or which are under common control with the Bank and its subsidiaries. They also include associated companies and individuals which directly or indirectly own a voting interest in the Bank and its subsidiaries that give them significant influence over the Bank and its subsidiaries, key management personnel, directors and officers with authority in the planning and direction of the Bank’s and its subsidiaries’ operations. 6.25 Impairment of assets The Bank and its subsidiaries assess at each financial reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Bank and its subsidiaries realise loss on impairment when the asset’s recoverable amount is less than the book value. An asset’s recoverable amount is the higher of an asset’s fair value less costs to sell and its value in use. Fair value less costs to sell reflects the amount that the Bank and its subsidiaries could obtain at the financial reporting date from the disposal of the asset in an arm’s length transaction between knowledgeable, willing parties, after deducting the costs of disposal. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. The Bank and its subsidiaries recognise impairment losses as expenses in part of profit or loss in the statement of comprehensive income. In assessing impairment of asset other than goodwill, if there is any indication that previously recognised impairment losses may no longer exist or may have decreased, the Bank and its subsidiaries estimate the asset’s recoverable amount. A previously recognised impairment loss for assets other than goodwill is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognised. The increased carrying amount of the asset attributable to a reversal of an impairment loss shall not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in part of profit or loss in the statement of comprehensive income.

31

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Annual Report 2011 Thanachart Bank Public Company Limited


6.26 Employee benefits a)

Short-term employee benefits The Bank and its subsidiaries recognised short-term employee benefits, such as salary, wages, bonuses, contributions to the social security fund, and vacation, as expenses when incurred.

b)

Post-employment benefits (Defined contribution plans) The Bank, its subsidiaries and its employees have jointly established a provident fund. The fund is monthly contributed by employees and by the Bank and its subsidiaries. The fund’s assets are held in a separate trust fund, and the Bank and its subsidiaries contributions are recognised as expenses when incurred.

c)

Post-employment benefits (Defined benefit plans) The Bank and its subsidiaries have obligations in respect of the severance payments it must make to employees upon retirement under labor law. The Bank and its subsidiaries treat these severance payment obligations as a defined benefit plan. The obligation under the defined benefit plan is determined by a professionally qualified independent actuary, using the projected unit credit method. Actuarial gains and losses arising from post employment benefits are recognized immediately in profit or loss. For the first-time adoption of TAS 19 Employee Benefits, the Bank and its subsidiaries elected to recognise the transitional liability, which exceeds the liability that would have been recognised at the same date under the previous accounting policy, through an adjustment to the beginning balance of retained earnings in the current year.

6.27 Foreign currencies Foreign currency transactions are translated into Baht at the exchange rates ruling at the transaction dates. Monetary assets and liabilities denominated in foreign currencies and commitment outstanding on the financial reporting date have been translated into Baht at the rates ruling at the financial reporting date. Exchange gains and losses arising from trading or translation of foreign currencies are included in determining income.

32

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6.28 Income tax Income tax is provided in the accounts at the amount expected to be paid to the taxation authorities, based on taxable profits determined in accordance with tax legislation. 6.29 Provisions Provisions are recognised when the Bank and its subsidiaries have a present obligation as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. 7.

Significant accounting judgments and estimates The preparation of financial statements in conformity with generally accepted accounting principles at times requires management to make subjective judgments and estimates regarding matters that are inherently uncertain. These judgments and estimates affect reported amounts and disclosures; and actual results could differ from these estimates. Significant judgments and estimates are as follows:

7.1

Recognition and derecognition of assets and liabilities In considering whether to recognise or to derecognise assets or liabilities, the management is required to make judgment on whether significant risk and rewards of those assets or liabilities have been transferred, based on their best knowledge of the current events and arrangements.

7.2

Allowance for doubtful accounts for loans and allowance for impairment of investment in receivables Allowance for doubtful accounts for loans and allowance for impairment of investment in receivables are intended to adjust the value of loans for probable credit losses. The management uses the BOT’s and SEC’s regulations regarding the provision of allowance for doubtful accounts and judgments to estimate losses on outstanding loans when there is any doubt about the borrower’s capability to repay the principal and/or the interest. The allowances for loan losses are determined through a combination of specific reviews, probability of default, value of collateral and current economic conditions.

33

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Annual Report 2011 Thanachart Bank Public Company Limited


7.3

Allowance for impairment of investments in securities The Bank and its subsidiaries review an impairment of investments in securities when indication of impairment exists. The determination of what is indication of impairment requires the management’s judgment.

7.4

Fair value of financial instruments In determining the fair value of financial instruments that are not actively traded and for which quoted market prices are not readily available, the management exercised judgment, using a variety of valuation techniques and models. The input to these models is taken from observable markets, and includes consideration of liquidity, correlation and longer-term volatility of financial instruments.

7.5

Allowance for impairment of property foreclosed The Bank and its subsidiaries assess allowance for impairment of property foreclosed when net realisable value falls below the book value. The management uses the BOT’s regulation and judgment to estimate impairment losses, taking into consideration the latest appraisal value, the type and the nature of the assets.

7.6

Land, premises and equipment/Depreciation In determining depreciation of premises and equipment, the management is required to make estimates of the useful lives and salvage values of the premises and equipment, and to review estimate useful lives and salvage values when there are any changes. In addition, the management is required to review impairment of land, premises and equipment on a periodical basis and record impairment losses in the period when it is determined that their recoverable amounts are lower than the carrying amounts. This requires judgments regarding forecast of future revenues and expenses relating to the assets subject to the review.

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7.7

Goodwill and intangible assets The initial recognition and measurement of goodwill and intangible assets, and subsequent impairment testing, require management to exercise judgment as to the recoverable amount to be generated by the asset, using the discounted cash flows method, and including the selection of a suitable discount rate in order to determine the present value of that cash flow. The estimated cash flows may differ as a result of competitive forces, or changes in revenue trends, cost structures, and the discount rate, industry circumstances or related market conditions. In addition, the management estimates the useful life of those assets which have finite useful lives and revises such useful lives if there are any changes.

7.8

Finance lease/Operating lease When entering into lease agreement, the management is required to access and consider the scope of significant risk and rewards of ownership of the leased assets. Leases that transfer substantially all the risks and rewards of ownership to the leasee are classified as financial leases. In the other hand, leases not transferring a significant portion of the risks and rewards of ownership to the leasee are classified as operating leases.

7.9

Loss sharing from transfer of non-performing loans to TAMC In estimating losses arising from the transfer of non-performing loans to the Thai Asset Management Corporation (“TAMC�), the Bank uses the latest information received from TAMC and projections of the amounts expected to be received from the debtors or from debtors’ collateral value. The management uses judgment in determining the assumptions as to the percentage on the amount expected to be recovered from the debt restructuring agreement, or as to collateral value. The management considers these assumptions to be appropriate given the current available information and current situation

7.10 Unearned premium/Life insurance premium reserve Unexpired risk reserve is calculated under an actuarial method, which reflects the best estimate of losses expected to be incurred over the remaining period of the insurance. Estimating these reserves requires management to exercise judgment, with reference made to historical data and current best estimates at that time.

35

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Life assurance policy reserve is calculated under an actuarial method, and adjusted upwards to reflect risk factors and deviations. The main assumptions used relate to policy termination or surrender rates, selling and administrative expenses, mortality rate, morbidity rate, longevity, expenses and discount rates. Estimating these reserves requires management to exercise judgments with reference made to historical data and current best estimates at that time. 7.11 Loss reserve and outstanding claims At each reporting date, subsidiaries estimate loss reserves and outstanding claims in two parts; loss incurred for which the claims advice has been received from the insured, and loss incurred but not yet reported (IBNR). The IBNR reserve is calculating by using an international standard actuarial method. The main assumptions underlying these techniques relate to historical claims experience, including development of estimates of paid and incurred losses, average costs per claim, and claim numbers. Estimating these reserves requires management to exercise judgment reflecting the best estimates available at that time. 7.12 Post-employment benefits under defined benefit plans Obligations under the defined benefit plan are determined by using actuarial technique. Such determination is made based on various assumptions, including discount rate, future salary increase rate, staff turnover rate, mortality rate, and inflation rates, based on their best knowledge of current situation. 7.13 Litigation and contingent liabilities The Bank and its subsidiaries have contingent liabilities as a result of litigation and contingent liabilities as a result of transfer of business and transfer of non-performing assets. The management has used judgment to assess of the results of the litigation, and in case where they believe that there will be no losses, they will provide no provisions and contingent liabilities as at the end of reporting period.

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Annual Report 2011 Thanachart Bank Public Company Limited

117


8.

Interbank and money market items (assets) (Unit: Million Baht) Consolidated financial statements 2011 At call

2010

Term

Total

5,492

2,000

7,492

549

8,518

39

At call

Term

Total

4,821

26,000

30,821

9,067

854

21,022

21,876

8,238

8,277

42

14,545

14,587

197

22,618

22,815

150

16,079

16,229

6,277

41,374

47,651

5,867

77,646

83,513

Add: Accrued interest receivables

-

11

11

-

34

34

Less: Allowance for doubtful accounts

-

(193)

(193)

-

(162)

(162)

Domestic Bank of Thailand and Financial Institutions Development Fund Commercial banks Specialised financial institutions Other financial institutions Total

Total domestic items

6,277

41,192

47,469

5,867

77,518

83,385

1,449

13,470

14,919

776

169

945

Euro

119

-

119

119

-

119

Others

523

103

626

496

114

610

2,091

13,573

15,664

1,391

283

1,674

-

68

68

-

1

1

Total foreign items

2,091

13,641

15,732

1,391

284

1,675

Total

8,368

54,833

63,201

7,258

77,802

85,060

Foreign US Dollar

Total Add: Accrued interest receivables

37

118

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) Separate financial statements 2011 At call

2010

Term

Total

5,492

2,000

7,492

393

8,340

27

At call

Term

Total

3,178

12,000

15,178

8,733

109

10,820

10,929

8,200

8,227

30

-

30

196

22,769

22,965

115

1,570

1,685

6,108

41,309

47,417

3,432

24,390

27,822

Add: Accrued interest receivables

-

9

9

-

6

6

Less: Allowance for doubtful accounts

-

-

-

-

Domestic Bank of Thailand and Financial Institutions Development Fund Commercial banks Specialised financial institutions Other financial institutions Total

Total domestic items

(195)

(195)

6,108

41,123

47,231

3,432

24,396

27,828

1,449

13,470

14,919

347

70

417

Euro

119

-

119

7

-

7

Others

523

103

626

61

114

175

2,091

13,573

15,664

415

184

599

-

68

68

-

1

1

Total foreign items

2,091

13,641

15,732

415

185

600

Total

8,199

54,764

62,963

3,847

24,581

28,428

Foreign US Dollar

Total Add: Accrued interest receivables

As at 31 December 2011, the Bank had loan to a subsidiary company of Baht 150 million in the separate financial statements.

38

Annual Report 2011 Thanachart Bank Public Company Limited

119


9.

Derivatives As at 31 December 2011 and 2010, the notional amount and the fair value of trading derivatives, and the adjustments made on an accrual basis for banking book derivatives were classified by type of risk as follow. (Unit: Million Baht) Consolidated financial statements 2011

2010

Fair value/Adjustment on an accrual basis

Notional

Liabilities

Assets

Fair value/Adjustment on

amount*

an accrual basis Assets

Notional

Liabilities

amount*

Type of risk Foreign exchange rate Derivatives for trading Derivatives for banking book

858

820

63,491

509

295

53,139

-

1,706

31,788

3

5

3,488

64

60

5,957

72

67

5,657

-

-

3,967

-

-

13,681

29

9

2,212

959

235

8,533

585

291

15,445

1,574

339

21,529

-

-

641

-

-

-

1,536

2,886

123,501

3,117

941

106,027

Interest rate Derivatives for trading Derivatives for banking book Foreign exchange rate and interest rate Derivatives for trading Derivatives for banking book Others Derivatives for trading Total

* Disclosed only in case that the Bank and its subsidiaries have an obligation to pay

39

120

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) Separate financial statements 2011

2010

Fair value/Adjustment

Notional

Fair value/Adjustment

on an accrual basis Assets

Notional

on an accrual basis

Liabilities

amount*

Assets

Liabilities

amount*

854

811

63,491

109

90

20,853

-

1,706

31,788

3

5

3,488

64

60

5,957

-

-

-

-

-

3,667

-

-

12,532

29

9

2,212

-

-

-

585

291

15,445

816

339

13,479

1,532

2,877

122,560

928

434

50,352

Type of risk Foreign exchange rate Derivatives for trading Derivatives for banking book Interest rate Derivatives for trading Derivatives for banking book Foreign exchange rate and interest rate Derivatives for trading Derivatives for banking book Total

* Disclosed only in case that the Bank and its subsidiaries have an obligation to pay

Derivatives for banking book are obligations under contracts which are not held for trading, and are measured on an accrual basis. Gain (loss) on exchange at the end of the year is presented under derivatives assets/derivatives liabilities. Accrued interest receivables (payables) per the contracts are recorded as receivables and payables in other assets/liabilities. Below are the proportions of trading derivatives transactions classified by counterparty, determined based on the notional amount, as at 31 December 2011 and 2010. Consolidated financial statements Counterparties

Financial institutions Companies within Thanachart Group Third parties Total

Separate financial statements

2011

2010

2011

2010

Percent

Percent

Percent

Percent

80.01

73.91

79.83

86.29

-

-

0.89

-

19.99

26.09

19.28

13.71

100.00

100.00

100.00

100.00

40

Annual Report 2011 Thanachart Bank Public Company Limited

121


10.

Investments

10.1 Classified by type of investment (Unit: Million Baht) Consolidated financial statements 2011

Separate financial statements

2010

Cost/

2011

Cost/

Amortised

Amortised

cost

Fair value

cost

2010

Cost/

Cost/

Amortised Fair value

Amortised Fair value

cost

Fair value

cost

Trading securities Government and state enterprises 10,508

10,479

44

45

3,174

3,179

44

45

Private debt securities

securities

4,770

4,758

21

21

1,661

1,660

21

21

Foreign debt securities

642

637

3,015

3,023

642

637

-

-

34

38

74

80

-

-

-

-

15,954

15,912

3,154

3,169

5,477

5,476

65

66

Domestic marketable equity securities Add: Allowance for change in value

(42)

15 3,169

15,912

Net

(1)

1

5,476

66

Available-for-sale securities Government and state enterprises 40,877

41,003

52,685

52,604

38,431

38,554

15,764

15,708

Private debt securities

securities

18,389

18,533

9,898

10,064

13,529

13,600

2,945

2,981

Foreign debt securities

25,516

25,425

12,704

12,920

25,516

25,425

6,128

6,342

7,483

7,983

7,752

8,530

6,099

6,241

476

546

92,265

92,944

83,039

84,118

83,575

83,820

25,313

25,577

Domestic marketable equity securities

Add: Allowance for change in value Less: Allowance for impairment

683

1,083 (4)

(4) 92,944

Net

245

84,118

264

-

-

83,820

25,577

Held-to-maturity debt securities Government and state enterprises 26,876

27,771

36,138

36,849

17,642

18,096

18,986

Private debt securities

securities

6,592

6,689

5,874

6,070

1,600

1,647

-

-

Foreign debt securities

1,500

1,488

5,705

5,720

1,500

1,488

4,800

4,819

12

12

29

29

12

12

-

-

35,960

47,746

48,668

20,754

21,243

23,786

24,245

Investment in receivables purchased

34,980

19,426

Other investment Investment in property fund

671

845

671

234

3,794

4,064

3,776

97

84

84

84

3

4,549

4,993

4,531

334

Domestic non-marketable equity securities Foreign non-marketable equity securities

Less: Allowance for impairment Net Total investment - net

(40)

(4)

(40)

(4)

4,509

4,989

4,491

330

148,345

140,022

114,541

49,759

41

122

Annual Report 2011 Thanachart Bank Public Company Limited


10.2

Classified by due date of debt securities (Unit: Million Baht) Consolidated financial statements 2011

2010

Due within

Due within

Over

Less than 1 year

1 - 5 years

20,031

20,828

Private debt securities

1,557

Foreign debt securities

19,021

Total

Less than

Over

Total

1 year

1 - 5 years

18

40,877

31,162

21,492

31

14,836

1,996

18,389

4,175

5,600

123

9,898

6,495

-

25,516

904

11,800

-

12,704

40,609

42,159

2,014

84,782

36,241

38,892

154

75,287

35

103

41

179

15

278

8

301

40,644

42,262

2,055

84,961

36,256

39,170

162

75,588

5 years

5 years

Total

Available-for-sale securities Government and state enterprises securities

Add: Allowance for change in value Net

52,685

Held-to-maturity debt securities Government and state enterprises 5,157

15,659

6,060

26,876

3,650

11,032

21,456

36,138

Private debt securities

securities

3,990

2,288

314

6,592

1,346

3,063

1,465

5,874

Foreign debt securities

1,500

-

-

1,500

4,800

905

-

5,705

8

4

-

12

18

11

-

29

Total

10,655

17,951

6,374

34,980

9,814

15,011

22,921

47,746

Total debt securities

51,299

60,213

8,429

119,941

46,070

54,181

23,083

123,334

Investment in receivables

(Unit: Million Baht) Separate financial statements 2011

2010

Due within

Due within

Over

Less than 1 year

1 - 5 years

Less than

5 years

Total

1 year

Over 1 - 5 years

5 years

Total

Available-for-sale securities Government and state enterprises 18,399

20,014

18

38,431

10,302

5,462

-

15,764

Private debt securities

securities

975

12,554

-

13,529

2,076

781

88

2,945

Foreign debt securities

19,021

6,495

-

25,516

602

5,526

-

6,128

Total

38,395

39,063

18

77,476

12,980

11,769

88

24,837

32

71

-

103

10

179

5

194

38,427

39,134

18

77,579

12,990

11,948

93

25,031

4,938

12,704

-

17,642

3,201

7,316

8,469

18,986

Private debt securities

800

650

150

1,600

-

-

-

-

Foreign debt securities

1,500

-

-

1,500

4,800

-

-

4,800

8

4

-

12

-

-

-

-

7,246

13,358

150

20,754

8,001

7,316

8,469

23,786

45,673

52,492

168

98,333

20,991

19,264

8,562

48,817

Add: Allowance for change in value Net Held-to-maturity debt securities Government and state enterprises securities

Investment in receivables Total Total debt securities

42

Annual Report 2011 Thanachart Bank Public Company Limited

123


10.3 As at 31 December 2011, the Bank and its subsidiaries have a revaluation deficit arising from transfers of investments in debt securities, of which the current balances of Baht 3 million in the consolidated financial statements and Baht 34 million in the separate financial statements. These are presented in equity caption. (2010: Revaluation deficit of Baht 71 million in the consolidated financial statements, and revaluation deficit of Baht 94 million in the separate financial statements). 10.4 As at 31 December 2011, investments in held-to-maturity debt securities included nontransferable promissory notes amounting to Baht 4 million, which were received as a result of the transfer of non-performing loans to Thai Asset Management Corporation (“TAMC�) (2010: Baht 296 million). However, the agreed transfer price received in the form of promissory notes could be revised up or down after TAMC reviews the price, assesses the collateral or adjusts the price. As at 31 December 2011, the Bank is still unable to assess the exact amount of such losses since TAMC has been dissolved and is in the process of liquidation. However, the Bank estimated the contingent losses arising from the management of non-performing assets at approximately Baht 89 million (2010: Baht 89 million). Such amount has been shown as a part of provisions for liabilities. In addition, the Bank also shares joint responsibility with TAMC for future profits or losses arising from TAMC’s management of the non-performing assets as mentioned in Note 46.2 to the financial statements. 10.5 Investments in securities in which the Bank and its subsidiaries hold not less than 10 percent of the equity of the investee As at 31 December 2011 and 2010, investments in companies which the Bank and its subsidiaries hold not less than 10 percent of the equity of the investee, but which are not treated as subsidiaries or associated companies, separated by industry as follow: (Unit: Million Baht) Consolidated financial statements

Banking and finance sector

Separate financial statements

2011

2010

2011

2010

761

1,307

600

234

43

124

Annual Report 2011 Thanachart Bank Public Company Limited


The investments mentioned above include investments in unit trusts in which the Bank and its subsidiaries hold not less than 20 percent of the units issued. The Bank and its subsidiaries do not treat these investments as investments in subsidiaries or associates because the Bank and its subsidiaries do not have control or influence over the financial and operating policies of these funds, which are independently managed by fund managers in accordance with the details of each fund project, and are under the supervision of the SEC. The Bank and its subsidiaries therefore record them as availablefor-sale or other investments, based on their investment objectives. Separate financial statements

Consolidated financial statements 2010

2011

Securities

2011

2010

Net book

Percentage

Net book

Percentage

Net book

Percentage

value

of holding

value

of holding

value

of holding

value

of holding

Million

Percent

Million

Percent

Million

Percent

Million

Percent

Baht

Baht

Baht

Net book Percentage

Baht

The Thai Business Fund 3

144

60.00

355

60.00

144

60.00

158

26.67

Sub Thawee Property Fund

36

56.00

76

56.00

36

56.00

76

56.00

278

67.33

278

67.33

278

67.33

-

-

62

27.79

60

27.79

-

-

-

-

50

22.63

50

22.63

-

-

-

-

Business Strategic Fund Thanachart Long Term Fixed Income Fund Thanachart Fixed Income FIF 51

11.

Investments in subsidiary and associated companies

11.1 Separate financial statements As at 31 December 2011 and 2010, investments in subsidiary companies and an associated company in the separate financial statements stated under the cost method, consist of investment in ordinary shares of the following companies:

44

Annual Report 2011 Thanachart Bank Public Company Limited

125


(Unit: Million Baht) Separate financial statements Value of investment

Company’s name

Nature of business

Paid-up

Percentage

share capital

of holding (Percent)

2011

2010

2011

under the

2010

Dividend income

cost method

for the years

2011

2010

2011

2010

Subsidiary companies SCIB Plc. (Formerly known as “Siam Dissolution

21,128

21,128

99.98

99.95

32,542

68,835

260

-

TS Asset Management Co., Ltd.

City Bank Plc.”)

Asset management

2,000

-

100

-

2,000

-

-

-

Thanachart Securities Plc.

Securities business

1,500

1,500

100

100

1,858

1,858

345

210 -

Thanachart Life Assurance Co., Ltd. Thanachart Insurance Co., Ltd. Thanachart Group Leasing Co., Ltd.

Life - insurance

500

500

100

100

936

936

250

Non-life insurance

740

740

100

100

867

867

300

-

Hire purchase

360

360

100

100

400

400

203

148

1,342

-

65.18

-

1,201

-

-

-

broker

100

100

100

100

104

104

65

65

Fund management

100

100

75

75

97

97

97

83

Dissolution

10

10

100

100

13

13

-

-

Services

6

6

100

100

6

6

-

12

Training services

5

5

100

100

5

5

12

12

Services

10

-

100

-

5

-

-

-

-

761

-

-

-

40,795

73,121

1,532

530

47

-

-

-

47

-

-

-

40,842

73,121

1,532

530

Ratchthani Leasing Plc.

Hire-purchase and

Thanachart Broker Co., Ltd.

Non-life insurance

leasing business

Thanachart Fund Management Co., Ltd. Thanachart Legal and Appraisal Co., Ltd. Thanachart Management and Services Co., Ltd. Thanachart Training and Development Co., Ltd. SCIB Service Co., Ltd. Siam City Life Assurance Co., Ltd.

Life - insurance

700

-

100

Total investments in subsidiary companies Associated company Siam Samsung Life Insurance Co., Ltd.

Life - insurance

500

-

25

-

Total investments in an associated company Total investments in subsidiary and associated companies - net

After the entire business transfer from SCIB to Thanachart Bank, the Bank recognised intangible assets arising from the business combination of Baht 3,613 million and goodwill arising from the business combination of Baht 15,740 million in the separate financial statements by deducting them from the cost of investment in SCIB. This presentation is to reflect the business combination transactions in the separate financial statements. In addition, the Bank received a partial of capital return on investment in the form of dividend income. The Bank additional invested in TS Asset Management Co., Ltd., which was established in March 2011, with a shareholding of 100 percent.

45

126

Annual Report 2011 Thanachart Bank Public Company Limited


In October 2011, the Bank received the transfer of 437,250,000 shares in Ratchthani Leasing Plc. from SCIB, for a total of Baht 536 million. The Bank also purchased 437,486,500 additional shares from THANI at Baht 1.52 per share or for a total of Baht 665 million. As a result, the Bank’s shareholding increased from 48.35 percent to 65.18 percent and the status of Ratchthani Leasing Plc. was changed from an associated company to a subsidiary company. 11.2 Consolidated financial statements As at 31 December 2011 and 2010, investments in associated companies in the consolidated financial statements consist of investments in ordinary shares of the following companies which operate in Thailand: (Unit: Million Baht) Share of income (loss) for the Paid-up share capital Company’s name MBK Plc. (operating in

Value of investment

Percentage of holding

Cost method

Dividend income

Equity method

for the years 2011

periods ended 31 December

2011

2010

2011

2010

2011

2010

2011

2010

2010

2011

2010

1,886

1,886

9.90

9.90

984

984

1,389

1,530

93

89

132

160

500

500

25.00

25.00

104

104

34

81

-

-

(46)

(24)

-

40

-

45.50

-

92

-

109

10

-

(8)

17

-

823

-

48.35

-

403

-

457

12

-

78

54

1,088

1,583

1,423

2,177

property rental, hotel and services business) Siam Samsung Life Insurance Co., Ltd. (operating in life insurance business) Siam City Insurance Co., Ltd. (operating in non-life insurance business) Ratchthani Leasing Plc. (operating in hirepurchase and leasing business) Total investments in associated companies

115

89

156

207

The Bank and its subsidiaries classified investment in MBK Plc. as investments in an associated company, since the Parent company, the Bank and its subsidiaries had significant influence in that company. In August 2011, SCIB disposed of all of investments in ordinary shares of Siam City Insurance Co., Ltd.

46

Annual Report 2011 Thanachart Bank Public Company Limited

127


11.3 Cash flow information of an asset management company that is a subsidiary Cash flow information of TS Asset Management Company Limited, a subsidiary, for the year ended 31 December 2011 is as follows: (Unit: Million Baht) Cash flows from operating activities Profit before income tax

321

Adjustments to reconcile profit before income tax to net cash provided by (paid for) operating activities Reversal of bad debt and doubtful account Increase in allowance for impairment of property foreclosed Interest income - net

(221) 12 (188)

Cash received from interest income

232

Cash paid for interest expense

(83)

Income from operating activities before changes in operating assets and liabilities

73

Increase in operating assets Loans

(8,010)

Property foreclosed

(3,093)

Other assets

(47)

Increase in operating liabilities Interbank and money market items Other liabilities Net cash flows used in operating activities

9,822 123 (1,132)

Cash flows from investing activities Cash received from interest income from investments

4

Net cash flows from investing activities

4

Cash flows from financing activities Paid-up share capital

2,000

Net cash flows from financing activities

2,000

Net increase in cash and cash equivalents Cash and cash equivalents at beginning of the year Cash and cash equivalents at end of the year

872 872

47

128

Annual Report 2011 Thanachart Bank Public Company Limited


11.4 Summarised financial information of associated companies a)

Summarised financial information of MBK Plc. as at 30 September 2011 and 2010 and for the years then ended are as follows: (Unit: Million Baht)

Paid-up share capital

Total assets

30 September

Total liabilities

30 September

2011

2010

1,886

1,886

2011 27,409

30 September

2010 28,752

Total income

Net income

for the periods ended

for the periods ended

30 September

30 September

2011

2010

2011

2010

2011

2010

13,916

14,006

8,582

8,548

1,338

2,477

The share of income of MBK Plc. recognised in the current year is determined based on financial statements of MBK Plc. prepared for a different period, as a result of limitations on the availability of information. The financial information used was based on the statements of financial position as at 30 September 2011 and 2010 and the statements of profit or loss for the years then ended as prepared by the Bank’s management, with reference to the financial statements as reviewed by its auditor and adjusted for the effect of the differences in accounting policies. The Bank’s management believes that the net income for the year ended 30 September 2011 is not material different from that income for the year ended 31 December 2011. b)

Summarised financial information of Siam Samsung Life Insurance Co., Ltd., Siam City Insurance Co., Ltd. and Ratchthani Leasing Plc. as at 31 December 2011 and 2010 and for the periods then ended are as follows: (Unit: Million Baht) Paid-up share

Company’s name

capital

Total assets

Total liabilities

2011

2010

2011

2010

2011

2010

500

500

1,989

2,073

1,854

1,766

Siam City Insurance Co., Ltd.

-

40

-

932

-

Ratchthani Leasing Plc.

-

823

-

9,549

-

Siam Samsung Life Insurance

Total income

Net income (loss)

for the years

for the years

2011

2010

2011

2010

1,170

911

(184)

(98)

689

414

632

(17)

37

8,270

913

695

160

112

Co., Ltd.

Income, profit or loss and shares of profit (loss) of investments in associated companies were determined based on the financial statements of those companies for the period starting from the date that the Bank and/or the subsidiaries invested in such companies, in proportion to the shareholding interest, and until the Bank disposed of such investment or its status was changed to a subsidiary company.

48

Annual Report 2011 Thanachart Bank Public Company Limited

129


11.5 As at 31 December 2011 and 2010, the fair value of investments in associated companies which are listed in the Stock Exchange of Thailand is as follows (Unit: Million Baht) Company’s name MBK Plc.

2011

2010

1,649

1,887

-

616

Ratchthani Leasing Plc.

12.

Loans to customers and accrued interest receivables

12.1 Classified by loan type (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2010

23,358

24,562

23,358

3,243

271,129

275,232

250,290

58,324

Loans to customers Overdrafts Loans Notes receivable Hire purchase receivables

49,984

62,171

68,048

24,985

325,976

271,851

310,595

269,834

2,104

2,392

1,926

2,341

Financial lease receivables Others

234

Less: Deferred revenues

429

234

-

(39,801)

(32,469)

(37,739)

(32,178)

632,984

604,168

616,712

326,549

963

924

925

272

633,947

605,092

617,637

326,821

(25,197)

(23,917)

(12,102)

(7,056)

(396)

(534)

(383)

(375)

(382)

(460)

(382)

(38)

Total loans to customers net of deferred revenues Add: Accrued interest receivables Total loans to customers net of deferred revenues and accrued interest receivables Less: Allowance for doubtful accounts - BOT’s minimum requirement provision - Excess provision Less: Revaluation allowance for debt restructuring Loans to customer and accrued interest receivables - net

607,972

580,181

604,770

319,352

Securities business receivables Credit balances receivables

1,926

1,341

-

-

310

1,342

-

-

2,236

2,683

-

-

(1,338)

-

-

1,931

1,345

-

-

609,903

581,526

604,770

319,352

Other receivables Total securities business receivables

(305)

Less: Allowance for doubtful accounts Securities business receivables - net Loans to customer and accrued interest receivables - net

49

130

Annual Report 2011 Thanachart Bank Public Company Limited


12.2 Classified by currency and country (Unit: Million Baht) Consolidated financial statements 2011 Domestic Baht US Dollar

Total

Domestic

Foreign

Total

624,935

450

625,385

590,382

4,794

595,176

5,740

3,386

9,126

7,468

3,835

11,303

284

425

709

372

-

372

630,959

4,261

635,220

598,222

8,629

606,851

Other currencies Total*

Foreign

2010

* Total loans net of deferred revenues (Unit: Million Baht) Separate financial statements 2011 Domestic Baht US Dollar

Total

Domestic

Foreign

Total

602,308

450

602,758

322,533

380

322,913

7,282

5,853

13,135

2,803

800

3,603

395

424

819

33

-

33

609,985

6,727

616,712

325,369

1,180

326,549

Other currencies Total*

Foreign

2010

* Total loans net of deferred revenues

50

Annual Report 2011 Thanachart Bank Public Company Limited

131


12.3 Classified by type of business and loan classification (Unit: Million Baht) Consolidated financial statements 2011 The Bank and a subsidiary company which are financial institutions

Normal

Special

Sub-

Doubtful

mention

standard

Subsidiary

of loss

Doubtful

companies Consolidated

Total

Agricultural and mining

10,452

27

95

104

148

10,826

4

10,830

Manufacturing and commerce

60,956

4,364

3,363

6,741

6,484

81,908

59

81,967

Real estate and construction

42,730

1,463

577

736

2,454

47,960

12

47,972

Public utilities and services

49,553

3,317

921

1,529

3,060

58,380

61

58,441

68,632

1,503

552

1,221

1,728

73,636

-

73,636

-

-

-

-

-

-

2,236

2,236

242,023

27,443

664

648

2,241

273,019

13,342

286,361

48,357

2,076

673

763

2,095

53,964

116

54,080

Others

18,927

177

178

14

382

19,678

19

19,697

Total*

541,630

40,370

7,023

11,756

18,592

619,371

15,849

635,220

Personal consuming Housing loans Securities business Hire purchase Others

*

Total loans net of deferred revenues

(Unit: Million Baht) Consolidated financial statements 2010 The Bank and a subsidiary company which are financial institutions

Normal Agricultural and mining

Special

Sub-

mention

standard

Doubtful Doubtful

Subsidiary

of loss

Total

companies Consolidated

8,124

2,432

194

71

136

10,957

-

10,957

Manufacturing and commerce

73,796

8,663

1,697

8,459

4,768

97,383

1

97,384

Real estate and construction

45,690

1,958

1,549

644

2,552

52,393

13

52,406

Public utilities and services

55,570

4,490

1,210

1,659

3,112

66,041

6

66,047

72,939

1,890

581

813

1,413

77,636

-

77,636

-

-

-

-

-

-

2,683

2,683

218,478

15,416

782

606

2,589

237,871

1,740

239,611

15,474

842

428

169

909

17,822

54

17,876

Others

40,270

778

204

192

783

42,227

24

42,251

Total*

530,341

36,469

6,645

12,613

16,262

602,330

4,521

606,851

Personal consuming Housing loans Securities business Hire purchase Others

*

Total loans net of deferred revenues

51

132

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) Separate financial statements 2011 Special

Doubtful

Normal

mention

Substandard

Doubtful

of loss

Total

Agricultural and mining

10,452

27

69

15

25

10,588

Manufacturing and commerce

60,956

4,364

583

672

2,725

69,300

Real estate and construction

42,730

1,463

295

333

1,323

46,144

Public utilities and services

48,218

3,317

545

1,255

1,773

55,108

Housing loans

68,627

1,503

493

738

692

72,053

Hire purchase

242,023

27,443

664

648

2,241

273,019

48,356

2,076

654

616

1,596

53,298

Others

36,991

177

5

2

27

37,202

Total*

558,353

40,370

3,308

4,279

10,402

616,712

Personal consuming

Others

* Total loans net of deferred revenues

(Unit: Million Baht) Separate financial statements 2010 Special

Doubtful

Normal

mention

3,639

1

1

-

8

3,649

Manufacturing and commerce

20,751

193

65

130

450

21,589

Real estate and construction

18,434

104

254

163

439

19,394

Public utilities and services

18,110

17

8

197

77

18,409

Housing loans

4,998

466

162

107

285

6,018

Hire purchase

218,478

15,416

782

606

2,589

237,871

7,554

651

248

169

908

9,530

Others

10,064

25

-

-

-

10,089

Total*

302,028

16,873

1,520

1,372

4,756

326,549

Agricultural and mining

Substandard

Doubtful

of loss

Total

Personal consuming

Others

* Total loans net of deferred revenues

52

Annual Report 2011 Thanachart Bank Public Company Limited

133


12.4 Non-performing loans As at 31 December 2011 and 2010, the Bank and its subsidiaries (banking, securities and asset management) had non-performing loans classified in accordance with the Notification of the BOT and SEC (debtors classified as substandard, doubtful and doubtful of loss) as follows: (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2010

17,989

35,520

17,989

7,648

Securities business

306

1,339

-

-

Asset management

19,382

-

-

-

Non-performing loans (excluding accrued interest receivables) Banking business

The above definition of non-performing loans does not include overdue loans which have been already restructured and are now qualified for classification as Normal or Special mention debt. Additionally, the Bank and its subsidiaries (banking and securities business) had loans for which income recognition under an accrual basis has been discontinued, as follows: (Unit: Million Baht)

Banking business Securities business

Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2010

16,558

44,046

16,558

7,538

306

1,339

-

-

The subsidiary company engaged in the asset management business recognises income from loan on a cash basis.

53

134

Annual Report 2011 Thanachart Bank Public Company Limited


12.5 Debt restructuring During the years 2011 and 2010, the Bank and its subsidiaries have entered into debt restructuring agreements as follows: consolidated financial statements For the years ended 31 December

Number of Type of restructuring

debtors

Outstanding

Outstanding

loans balance

loans balance

Type of assets

assets to be

before

after

to be

transferred under

transferred

agreement

restructuring

(1)

restructuring

(1)

Million Baht

Million Baht

38,676

16,553

16,553

9

627

627

38,685

17,180

17,180

1

6

6

5,908

10,616

10,616

4

154

154

5,913

10,776

10,776

Fair value of

Million Baht

2011 Modification of repayment conditions Transfer of assets and/or ordinary shares and/or modification of repayment conditions Total

Land

190

2010 Transfer of assets

Land and premise

6

Modification of repayment conditions Transfer of assets and/or ordinary shares and/or modification of repayment conditions Total

Land

127

(1) Presents the outstanding balance per the books of account (principal plus accrued interest receivable).

54

Annual Report 2011 Thanachart Bank Public Company Limited

135


Separate financial statements For the years ended 31 December Outstanding

Outstanding

loans balance

loans balance

Type of assets

assets to be

before

after

to be

transferred under

transferred

agreement

Number of Type of restructuring

debtors

restructuring

(1)

restructuring

Million Baht

(1)

Fair value of

Million Baht

Million Baht

2011 Modification of repayment conditions

38,353

13,163

13,163

6

14

14

38,359

13,177

13,177

4,978

1,949

1,949

4

154

154

4,982

2,103

2,103

Transfer of assets and/or ordinary shares and/or modification of repayment conditions Total

Land

15

Land

127

2010 Modification of repayment conditions Transfer of assets and/or ordinary shares and/or modification of repayment conditions Total

(1) Presents the outstanding balance per the books of account (principal plus accrued interest receivable).

Counting from the end of the year, the remaining periods to maturity of receivables which entered into debt restructuring agreements during the years 2011 and 2010, are summarised below. Consolidated financial statements For the years ended 31 December 2011

2010 Outstanding

Periods

Outstanding

Number of

balances after

Number of

balances after

debtors

restructuring

debtors

restructuring

Million Baht Past due after restructuring

Million Baht

1,261

1,734

1,299

582

908

1,504

670

618

27,984

8,645

2,096

1,563

8,498

5,213

1,609

7,295

10 - 15 years

13

45

112

458

Over 15 years

21

39

127

260

38,685

17,180

5,913

10,776

Due within the year Less than 5 years 5 - 10 years

Total

55

136

Annual Report 2011 Thanachart Bank Public Company Limited


Separate financial statements For the years ended 31 December 2011

2010 Outstanding

Periods

Outstanding

Number of

balances after

Number of

balances after

debtors

restructuring

debtors

restructuring

Million Baht Past due after restructuring

Million Baht

1,169

841

1,247

438

812

168

663

130

27,947

8,098

1,947

505

8,422

4,029

1,102

977

10 - 15 years

5

31

9

13

Over 15 years

4

10

14

40

38,359

13,177

4,982

2,103

Due within the year Less than 5 years 5 - 10 years

Total

Supplemental information for the years 2011 and 2010 relating to restructured loan is as follows: (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2010

2011

2011

2010

Interest incomes recognised in the statements of comprehensive income Cash repayment from receivables

1,292

1,080

543

487

4,985

4,331

2,288

1,594

58

309

58

303

40

77

15

123

Properties foreclosed received for debts settlement Loss on debt restructuring

As at 31 December 2011 and 2010, the Bank and its subsidiaries have the following restructured receivables balances (principal and accrued interest receivable): Restructured receivables Total number of

Outstanding balances,

outstanding receivables 2011

Thanachart Bank Plc. Siam City Bank Plc. Thanachart Securities Plc. TS Asset Management Co., Ltd.

2010

Number of receivables 2011

Outstanding balances

2010

net of collateral

2011

2010

2011

2010

Million Baht

Million Baht

Million Baht

Million Baht

1,378,861

944,313

52,289

13,944

25,803

5,324

9,350

2,414

-

358,647

-

6,247

-

22,871

-

9,560

886

395

3

3

35

35

35

35

2,459

-

1,630

-

12,978

-

5,173

-

56

Annual Report 2011 Thanachart Bank Public Company Limited

137


12.6 Hire purchase/Financial lease receivables As at 31 December 2011, net hire purchase/financial lease receivables of the Bank and its subsidiaries amounting to Baht 283,038 million were recorded in the consolidated financial statements, with Baht 270,015 million recorded in the separate financial statements. These mostly comprise hire purchase agreements or financial lease agreements for cars and motorcycles. The terms of the agreements are generally between 3 and 7 years and they carry interest at fixed rates. (Unit: Million Baht) Consolidated financial statement as at 31 December 2011 Amounts due under lease agreements Less than 1 year* Gross investment in the lease Less: Unearned finance income

1 - 5 years

98,530

218,233

(15,589)

(23,687)

82,941

194,546

Over 5 years 11,317 (515)

Total 328,080 (39,791)

Present value of minimum lease payments receivable

10,802

288,289 (5,251)

Allowance for doubtful accounts Hire purchase/Financial lease receivables -

283,038

net * Included non-performing receivables

(Unit: Million Baht) Consolidated financial statement as at 31 December 2010 Amounts due under lease agreements Less than 1 year* Gross investment in the lease Less: Unearned finance income

1 - 5 years

89,288

177,763

(13,967)

(18,248)

75,321

159,515

Over 5 years 7,192 (242)

Total 274,243 (32,457)

Present value of minimum lease payments receivable Allowance for doubtful accounts

6,950

241,786 (5,137)

Hire purchase/Financial lease receivables net

236,649

* Included non-performing receivables

57

138

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) Separate financial statement as at 31 December 2011 Amounts due under lease agreements Less than 1 - 5 years

1 year* Gross investment in the lease Less: Unearned finance income

96,982

204,671

(15,423)

(21,881)

81,559

182,790

Over 5 years 10,868 (425)

Total 312,521 (37,729)

Present value of minimum lease payments receivable

10,443

274,792 (4,777)

Allowance for doubtful accounts Hire purchase/Financial lease receivables -

270,015

net * Included non-performing receivables

(Unit: Million Baht) Separate financial statement as at 31 December 2010 Amounts due under lease agreements Less than 1 year* Gross investment in the lease Less: Unearned finance income

1 - 5 years

88,359

176,636

(13,827)

(18,105)

74,532

158,531

Over 5 years 7,180 (242)

Total 272,175 (32,174)

Present value of minimum lease payments receivable Allowance for doubtful accounts

6,938

240,001 (4,925)

Hire purchase/Financial lease receivables net

235,076

* Included non-performing receivables

58

Annual Report 2011 Thanachart Bank Public Company Limited

139


12.7 Classified by classification As at 31 December 2011 and 2010, the Bank and its financial institution subsidiaries (banking and asset management business) classified and made allowances against their loans in accordance with the BOT’s guidelines as summarised below. (Unit: Million Baht) Consolidated financial statements (1) Net balance used in Loans and accrued

made allowance for

Minimum

Allowance for doubtful

interest receivables

doubtful accounts (2)

percentage

accounts

2011

2010

2011

2010

542,456

531,104

201,301

189,131

40,447

36,539

18,289

16,944

2

722

2,249

7,031

6,663

3,870

2,805

100

3,870

2,898

Doubtful

11,763

12,620

7,507

8,199

100

7,507

8,277

Doubtful of loss

18,631

16,323

8,208

8,180

100

8,348

8,199

620,328

603,249

239,175

225,259

24,417

23,705

383

534

24,800

24,239

Normal Special mention Substandard

Total

(Percent) 1

2011

2010

3,970

2,082

Additional allowance for possible uncollectability debts Total (1)

Only the Bank and subsidiary companies subject to BOT’s regulations; and after deducting intragroup transactions.

(2)

The net balance used in setting allowance for doubtful accounts for loans classified as Normal and Special mention is the principal balance net of deferred revenues, excluding accrued interest receivables, and after deducting collaterals values, while for loans classified as Substandard, Doubtful and Doubtful of loss, it is the principal balance net of deferred revenues plus accrued interest receivables, and after deducting the present value of expected future cash flows from debt collection or from disposal of collaterals. (Unit: Million Baht) Separate financial statements Net balance used in

Normal Special mention

Loans and accrued

made allowance for

interest receivables

(1)

doubtful accounts

2011

2010

2011

2010

559,184

302,266

218,024

103,855

40,447

16,887

18,289

8,414

Minimum

Allowance for doubtful

percentage

accounts

(Percent)

2011

2010

1

2,812

1,155

2

721

168

Substandard

3,309

1,523

1,500

1,070

100

1,500

1,070

Doubtful

4,279

1,372

1,791

775

100

1,791

775

10,418

4,773

5,138

3,888

100

5,278

3,888

617,637

326,821

244,742

118,002

12,102

7,056

383

375

12,485

7,431

Doubtful of loss Total

Additional allowance for possible uncollectability debts Total (1)

The net balance used in setting allowance for doubtful accounts for loans classified as Normal and Special mention is the principal balance net of deferred revenues, excluding accrued interest receivables, and after deducting collaterals values, while for loans classified as Substandard, Doubtful and Doubtful of loss, it is the principal balance net of deferred revenues plus accrued interest receivables, and after deducting the present value of expected future cash flows from debt collection or from disposal of collaterals.

59

140

Annual Report 2011 Thanachart Bank Public Company Limited


From July to December 2011, there was widespread flooding in Thailand. The floods may affect the business of certain debtors. The Bank has provided support to its customers in accordance with the policy of the BOT by relaxing principal and/or interest payments, extending the repayment schedule, maintaining the status of each debtor as it was before such floods occurred, and not treating the related receivables as non-performing loans. As at 31 December 2011 a total of 27,783 debtors with total balances of Baht 22,096 million had received relaxations of terms due to the flooding. However, the Bank’s management believes that no further significant damage will be incurred as a result of this situation. 12.8

Loan to companies which have settlement problems As at 31 December 2011 and 2010, loans of the Bank and its subsidiaries in the consolidated financial statements and the separate financial statements included debts due from companies with weak financial positions and poor operating results, as follows: Consolidated financial statements Allowance for doubtful accounts provided Number of debtors 2011

1. Listed companies possible to

2010

Debt balance

Collateral value

in the accounts

2011

2010

2011

2010

2011

2010

Million

Million

Million

Million

Million

Million

Baht

Baht

Baht

Baht

Baht

Baht

6

6

857

425

67

67

790

359

9

11

585

750

334

753

236

275

1,130

1,102

24,337

30,827

11,760

13,545

13,213

13,708

delisting from the SET 2. Non - listed companies with similar operating results and financial positions to listed companies possible to delisting from the SET 3. Companies which have loan settlement problems or have defaulted on the repayment

Separate financial statements Allowance for doubtful accounts provided Number of debtors 2011

1. Listed companies possible to

2010

Debt balance

Collateral value

in the accounts

2011

2010

2011

2010

2011

2010

Million

Million

Million

Million

Million

Million

Baht

Baht

Baht

Baht

Baht

Baht

3

2

169

122

31

-

138

122

9

11

585

750

334

753

236

275

737

432

8,042

931

5,323

580

2,726

392

delisting from the SET 2. Non - listed companies with similar operating results and financial positions to listed companies possible to delisting from the SET 3. Companies which have loan settlement problems or have defaulted on the repayment

60

Annual Report 2011 Thanachart Bank Public Company Limited

141


12.9 Classification of securities business receivables in accordance with the Notification of the Securities and Exchange Commission As at 31 December 2011 and 2010, subsidiary companies operating in the securities business classified securities business receivables and accrued interest receivables, and provided related allowance for doubtful accounts, in accordance with the Notification of the Securities and Exchange Commission (SEC), as follows: (Unit: Million Baht) Debt balance net of allowance Allowance for doubtful accounts

Receivable balances 2011 Normal

1,930

Substandard

2011

1,344

2010 -

2011

2010

-

1,930

1,344

3

4

2

3

1

1

303

1,335

303

1,335

-

-

2,236

2,683

305

1,338

1,931

1,345

Doubtful Total

2010

for doubtful accounts

Allowance for doubtful accounts for substandard loans set aside by subsidiaries is higher than the minimum amount required by the SEC, and takes into account uncertainties as to collateral value and the risk from collection of such receivables. 12.10 Hire purchase receivables/financial lease receivables of subsidiaries classified by aging As at 31 December 2011 and 2010, hire purchase and financial lease receivables balances of subsidiary companies engaged in hire purchase and financial lease businesses are classified by the due date of the contracts (after elimination) as follows: (Unit: Million Baht) 2011

2010

12,863

1,590

363

40

Overdue more than 1 year

66

48

Debtors under legal actions

205

107

13,497

1,785

792

212

Current or overdue not over 90 days Overdue 91 - 365 days

Total Allowance for doubtful accounts provided in the accounts

61

142

Annual Report 2011 Thanachart Bank Public Company Limited


12.11 As at 31 December 2011 and 2010, the Bank has loans to subsidiary companies as follows: Company’s name

Type of credit

Contract period as at

Interest rate as at

31 December 2011

31 December 2011

Outstanding balances 2011

2010

Million Baht

Million Baht

353

932

22

52

7,867

-

9,822

-

18,064

984

Subsidiary companies Thanachart Group Leasing Co.,

Promissory note

At call

The Bank’s cost of fund plus a

Ltd.

fixed interest rate per annum

National Leasing Co., Ltd.

Promissory note

At call

The Bank’s cost of fund plus a fixed interest rate per annum

Ratchthani Leasing Plc.

Promissory note

At call

The Bank’s cost of fund plus a

TS Asset Management Co., Ltd.

Promissory note

At call

The Bank’s cost of fund plus a

fixed interest rate per annum

fixed interest rate per annum Total

13.

Allowance for doubtful accounts (Unit: Million Baht) Consolidated financial statements 2011 The Bank and a subsidiary company which are financial institutions Sub-

mention

Doubtful of

General

loss

provision

Subsidiary

standard

Doubtful

companies

Consolidated

2,082

2,249

2,898

8,277

8,199

534

24,239

1,550

25,789

-

-

-

-

-

-

-

542

542

Normal Balance - beginning of the year

Special

Total

Beginning balance of the subsidiaries acquired during the year Balance of a subsidiary company disposed during the year Increase (decrease) during the year

1,888

(1,527)

Bad debts recovery

-

-

Bad debts written-off

-

-

Reversal from disposal of loans Balance - end of the year

992 (20)

(571)

1,826

(151)

253

156

-

(452)

(933)

-

-

-

-

-

3,970

722

3,870

7,507

(900) 8,348

383

-

(1,023)

2,457

91

409

11

(1,405) (900) 24,800

(73)

(1,023) 2,548 420 (1,478)

-

(900)

1,098

25,898

62

Annual Report 2011 Thanachart Bank Public Company Limited

143


(Unit: Million Baht) Consolidated financial statements 2010 The Bank and a subsidiary company which are financial institutions

Normal Balance - beginning of the year

Special

Sub-

Doubtful

General

mention

standard

Doubtful

of loss

provision

Subsidiary companies

Total

Consolidated

895

188

968

1,181

4,258

214

7,704

659

8,363

971

2,854

1,346

4,745

6,244

-

16,160

1,074

17,234

Beginning balance of the subsidiaries acquired during the year Balance of a subsidiary company disposed during the year Increase (decrease) during the year

-

-

216

(793)

-

-

584

2,595

(858)

-

-

(64)

320

2,064

(29)

Bad debts recovery

-

-

-

223

56

-

279

Bad debts written-off

-

-

-

(467)

(594)

-

(1,061)

Reversal from disposal of loans

-

-

-

-

(907)

-

(907)

-

2,082

2,249

2,898

8,277

534

24,239

1,550

Balance - end of the year

8,199

16 (106)

(64) 2,035 295 (1,167) (907) 25,789

(Unit: Million Baht) Separate financial statements 2011 Special Normal Balance - beginning of the year Increase (decrease) during the year

mention

1,155

168

10

138

Substandard 1,070 (775)

Doubtful

Doubtful

General

of loss

provision

Total

775

3,888

375

7,431

729

1,278

8

1,388

Increase for receivables which were transferred from SCIB during the 1,647

415

1,205

287

1,474

-

5,028

Bad debts recovery

year

-

-

-

-

156

-

156

Bad debts written-off

-

-

-

-

(618)

-

(618)

Reversal from disposal of loans

-

-

-

-

(900)

-

(900)

2,812

721

1,500

1,791

Balance - end of the year

5,278

383

12,485

(Unit: Million Baht) Separate financial statements 2010 Special Normal

mention

Substandard

Balance - beginning of the year

909

188

968

Increase (decrease) during the year

246

(20)

102

Doubtful 1,181 (406)

Doubtful

General

of loss

provision

Total

4,258

214

7,718

1,076

161

1,159

Bad debts recovery

-

-

-

-

55

-

55

Bad debts written-off

-

-

-

-

(594)

-

(594)

Reversal from disposal of loans

-

-

-

-

(907)

-

(907)

1,155

168

1,070

775

Balance - end of the year

3,888

375

7,431

63

144

Annual Report 2011 Thanachart Bank Public Company Limited


14.

Revaluation allowance for debt restructuring (Unit: Million Baht) Separate financial statements

Consolidated financial statements 2011 Balance - beginning of the year

2010

2011

2010

460

33

38

33

-

472

-

-

-

-

369

-

Beginning balance of the subsidiaries acquired during the year Additional allowance for receivables received during the year

15.

Increase (decrease) during the year

(35)

(40)

15

7

Amortised during the year

(43)

(5)

(40)

(2)

Balance - end of the year

382

382

38

460

Classification of assets As at 31 December 2011 and 2010, the quality of assets of the Bank and its subsidiaries classified in accordance with the announcements of the Bank of Thailand are as follows: (Unit: Million Baht) Consolidated financial statements 2011 Loans to customer and Interbank and

accrued

money market

interest

items

receivables

39,364

542,456

-

-

162

581,982

Special mention

-

40,447

-

-

108

40,555

Substandard

-

7,031

-

-

4

7,035

Normal

Property Investments

foreclosed

Other assets

Total

Doubtful

-

11,763

-

-

4

11,767

Doubtful of loss

-

18,631

238

197

237

19,303

39,364

620,328

238

197

515

660,642

Total

64

Annual Report 2011 Thanachart Bank Public Company Limited

145


(Unit: Million Baht) Consolidated financial statements 2010 Loans to customer and Interbank and

accrued

money market

interest

items

receivables

51,777

531,104

-

-

192

583,073

Special mention

-

36,539

-

-

84

36,623

Substandard

-

6,663

-

-

8

6,671

Doubtful

-

12,620

-

-

14

12,634

Doubtful of loss

-

16,323

89

56

503

16,971

51,777

603,249

89

56

801

655,972

Normal

Total

Property Investments

foreclosed

Other assets

Total

(Unit: Million Baht) Separate financial statements 2011 Loans to customer and Interbank and

accrued

money market

interest

items

receivables

39,514

559,184

-

-

162

598,860

Special mention

-

40,447

-

-

108

40,555

Substandard

-

3,309

-

-

4

3,313

Doubtful

-

4,279

-

-

4

4,283

Doubtful of loss

-

10,418

238

148

237

11,041

39,514

617,637

238

148

515

658,052

Normal

Total

Property Investments

foreclosed

Other assets

Total

(Unit: Million Baht) Separate financial statements 2010 Loans to customer and Interbank and

Normal

accrued

money market

interest

items

receivables

Property Investments

foreclosed

Other assets

Total

12,510

302,266

-

-

179

314,955

Special mention

-

16,887

-

-

82

16,969

Substandard

-

1,523

-

-

5

1,528

Doubtful

-

1,372

-

-

4

1,376

Doubtful of loss

-

4,773

89

56

16

4,934

12,510

326,821

89

56

286

339,762

Total

65

146

Annual Report 2011 Thanachart Bank Public Company Limited


16.

Property foreclosed (Unit: Million Baht) Consolidated financial statements For the year ended 31 December 2011 Increased from Balance -

purchase of

beginning

subsidiary

of the year

company

Additions

Disposals

Change

Balance - end

appraiser

of the year

Assets transferred in settlement of debts Immovable assets External appraiser Internal appraiser

6,472

-

108

(1,079)

114

5,615

233

-

16

(38)

289

4

3,184

(3,112)

-

365

External appraiser

673

-

93

(63)

4

707

Internal appraiser

72

-

7

(11)

(4)

64

168

-

(52)

7,907

4

Movable assets

(114)

97

Assets foreclosed from purchase by bid on the open market Immovable assets

Assets awaiting disposal External appraiser Total property foreclosed Less: Allowance for impairment Property foreclosed - Net

(56) 7,851

3,356

-

(528)

4

2,828

-

116

(4,303)

-

382

6,964

-

(3,921)

(202)

-

6,762 (Unit: Million Baht)

Consolidated financial statements For the year ended 31 December 2010 Increased from Balance -

purchase of

beginning

subsidiary

of the year

company

Additions

Disposals

Change

Balance - end

appraiser

of the year

Assets transferred in settlement of debts Immovable assets External appraiser

353

6,657

205

(639)

(104)

Internal appraiser

110

16

17

(14)

104

233

428

-

3,733

(3,872)

-

289

Movable assets

6,472

Assets foreclosed from purchase by bid on the open market Immovable assets External appraiser

-

577

119

(24)

1

673

65

7

13

(12)

(1)

72

-

168

-

-

168

Total property foreclosed

956

7,425

4,087

-

7,907

Less: Allowance for impairment

(44)

Property foreclosed - Net

912

Internal appraiser Assets awaiting disposal External appraiser

7,425

(186) 3,901

(4,561) 174 (4,387)

-

(56) 7,851

66

Annual Report 2011 Thanachart Bank Public Company Limited

147


(Unit: Million Baht) Separate financial statements For the year ended 31 December 2011 Increased from Balance -

purchase of

beginning

subsidiary

of the year

Additions

company

Disposals

Change

Balance - end

appraiser

of the year

Assets transferred in settlement of debts Immovable assets External appraiser

111

2,367

-

(33)

119

Internal appraiser

230

-

16

(38)

(119)

283

4

3,122

(3,064)

External appraiser

1

636

-

Internal appraiser

71

-

7

Movable assets

2,564 89

-

345

(17)

4

624

(11)

(4)

63

Assets foreclosed from purchase by bid on the open market Immovable assets

Assets awaiting disposal -

116

-

Total property foreclosed

External appraiser

696

3,123

3,145

Less: Allowance for impairment

(56)

Property foreclosed - Net

640

(63)

(3,163)

(165)

3,060

136

2,980

-

116

-

3,801

-

(3,027)

-

(148) 3,653 (Unit: Million Baht)

Separate financial statements For the year ended 31 December 2010 Balance Change

Balance - end

of the year

Additions

Disposals

appraiser

of the year

External appraiser

353

186

(324)

(104)

111

Internal appraiser

110

17

(1)

104

230

410

3,610

(3,737)

-

283

-

-

-

1

1

(1)

71

-

696

beginning

Assets transferred in settlement of debts Immovable assets

Movable assets Assets foreclosed from purchase by bid on the open market Immovable assets External appraiser Internal appraiser

65

12

(5)

Total property foreclosed

938

3,825

(4,067)

Less: Allowance for impairment

(43)

Property foreclosed - Net

895

(167) 3,658

154 (3,913)

-

(56)

-

640

67

148

Annual Report 2011 Thanachart Bank Public Company Limited


16.1 As at 31 December 2011 and 2010, property foreclosed received in settlement of receivables that are subject to restrictions can be summarised as follows: (Unit: Million Baht) Consolidated financial statements 2011

Separate financial statements

2010

2011

2010

Immovable assets subject to buyback 739

options or first refusal rights

522

739

221

16.2 As at 31 December 2011, the Bank and its subsidiaries have agreements with clients to purchase or sell property foreclosed amounting to approximately Baht 966 million (at cost) in the consolidated financial statements and Baht 926 million in the separate financial statements that are currently being settled in installments or through transfer of ownership. The Bank and its subsidiaries have therefore not recognised gains on the sales, and the assets continue to be recorded as property foreclosed of the Bank and its subsidiaries. 17.

Land, premises and equipment (Unit: Million Baht) Consolidated financial statements For the year ended 31 December 2011

Land

Buildings and

Furniture,

buildings

fixtures and

improvement

equipment

Assets under Vehicles

installation

Total

Cost 31 December 2010

4,649

2,652

3,916

155

134

11,506

12

37

6

7

-

62

-

(120)

Increase from purchase of subsidiary company Decrease from disposal of a subsidiary company Additions

-

-

(107)

(13)

43

54

428

11

327

863

(277)

(10)

(84)

(315)

(686)

Transfers/disposals

-

31 December 2011

4,704

2,466

4,233

76

146

11,625

-

201

2,258

60

-

2,519

Accumulated depreciation 31 December 2010 Decrease from disposal of a subsidiary company

-

(95)

(13)

-

(270)

(310)

(74)

-

Depreciation for the years

-

216

756

42

-

1,014

31 December 2011

-

147

2,609

15

-

2,771

Transfer/disposals

-

(108) (654)

Allowance for impairment 31 December 2010 Increase (decrease) during the period

-

-

1

-

-

1

68

26

1

-

-

95

-

-

(1)

-

-

(1)

68

26

1

-

-

95

4,636

2,293

1,623

61

146

8,759

Decrease from disposal of a subsidiary company 31 December 2011 Net book value 31 December 2011 Depreciation charge for the year

1,014

68

Annual Report 2011 Thanachart Bank Public Company Limited

149


(Unit: Million Baht) Consolidated financial statements For the year ended 31 December 2010

Land

Buildings and

Furniture,

building

fixtures and

improvement

equipment

Assets under Vehicles

installation

Total

Cost 31 December 2009

426

390

3,057

168

18

4,059

4,173

2,142

704

62

134

7,215

Increase from purchase of subsidiary companies Decrease from disposal of a subsidiary -

-

Additions

company

54

56

380

(6)

20

(1)

90

-

600

(7)

Transfers/disposals

(4)

64

(219)

(94)

(108)

(361)

4,649

2,652

3,916

155

134

11,506

-

42

1,710

95

-

1,847

-

-

(2)

(1)

-

(3)

Transfer/disposals

-

(3)

(244)

(94)

-

(341)

Depreciation for the year

-

162

794

60

-

1,016

31 December 2010

-

201

2,258

60

-

2,519

1

-

-

-

-

1

-

-

-

-

-

-

(1)

-

1

-

-

-

-

-

1

-

-

1

4,649

2,451

1,657

95

134

8,986

31 December 2010 Accumulated depreciation 31 December 2009 Decrease from disposal of a subsidiary company

Allowance for impairment 31 December 2009 Increase from purchase of subsidiary companies Increase (decrease) during the year 31 December 2010 Net book value 31 December 2010 Depreciation charge for the year

1,016

69

150

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) Separate financial statements For the year ended 31 December 2011

Land

Buildings

Furniture,

and buildings

fixtures and

improvement

equipment

Assets under Vehicles

Total

installation

Cost 31 December 2010 Received from Entire Business Transfer Additions

475

371

2,572

105

13

3,536

4,100

1,921

756

8

114

6,899

43

22

197

5

50

317

Transfers/disposals

-

-

15

(33)

(26)

31 December 2011

4,618

2,314

3,540

110

(8)

144

10,726

31 December 2010

-

48

1,736

Transfers/disposals

-

-

Depreciation for the year

-

31 December 2011

Accumulated depreciation 62

-

1,846

(17)

(8)

-

(25)

52

470

18

-

540

-

100

2,189

72

-

2,361

4,618

2,214

1,351

38

144

8,365

Net book value 31 December 2011

540

Depreciation charge for the year

(Unit: Million Baht) Separate financial statements For the year ended 31 December 2010 Buildings and

Furniture,

buildings

fixtures and

improvement

equipment

426

331

2,456

Additions

54

40

127

Transfers/disposals

(5)

(11)

105

13

3,536

1,380

Land

Assets under Vehicles

installation

Total

Cost 31 December 2009

31 December 2010

-

475

371

2,572

31 December 2009

-

31

1,295

Transfers/disposals

-

-

Depreciation for the year

-

31 December 2010

101

17

3,331

15

13

249

(11)

(17)

(44)

Accumulated depreciation 54

-

(20)

(11)

-

(31)

17

461

19

-

497

-

48

1,736

62

-

1,846

1

-

-

-

-

1

(1)

-

-

-

-

(1)

-

-

-

-

-

-

475

323

836

43

13

1,690

Allowance for impairment 31 December 2009 Decrease during the year 31 December 2010 Net book value 31 December 2010 Depreciation charge for the year

497

70

Annual Report 2011 Thanachart Bank Public Company Limited

151


As at 31 December 2011, the Bank and its subsidiaries have vehicles acquired under financial leases with net book values amounting to approximately Baht 39 million. In addition, the Bank and its subsidiaries have office equipment and vehicles which have been fully depreciated but are still in use. The gross carrying amount before deducting accumulated depreciation and allowance for impairment loss, amounting to approximately Baht 1,330 million (separate financial statements: Baht 31 million and Baht 1,016 million, respectively). 18.

Intangible assets (Unit: Million Baht) Consolidated financial statements For the year ended 31 December 2011 Membership fees for Intangible

Thailand Futures

Computer

business

Computer

Exchange and

software under

combination

software

others

development

assets from

Total

Cost 31 December 2010

4,100

905

4

163

5,172

-

2

-

6

8

Increase from purchase of a subsidiary company Decrease from disposal of a -

(22)

-

-

Additions

subsidiary company

-

341

-

233

574

(22)

Transfers/disposals

-

(36)

3

(222)

(255)

31 December 2011

4,100

1,190

7

180

5,477

137

227

3

-

367

Accumulated amortisation 31 December 2010 Decrease from disposal of a subsidiary company Disposals

-

(4)

-

-

(4)

-

(258)

3

-

(255)

Amortisation for the year

465

169

1

-

635

31 December 2011

602

134

7

-

743

Allowance for impairment 31 December 2010

-

-

-

-

-

Increase during the period

-

27

-

-

27

-

(2)

-

-

(2)

-

25

-

-

25

3,498

1,031

-

180

4,709

Decrease from disposal of a subsidiary company 31 December 2011 Net book value 31 December 2011

635

Amortisation expenses for the year Remaining amortisation period (years)

8.3 years

0-10 years

0-1 years

-

71

152

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) Consolidated financial statements For the year ended 31 December 2010 Membership fees for Intangible

Thailand

assets from

Futures

Computer

business

Computer

Exchange and

software under

combination

software

others

development

Total

Cost 31 December 2009

-

492

7

116

615

-

253

1

39

293

4,100

65

-

109

4,274

Transfer

-

101

-

(101)

Disposals

-

Increase from purchase of subsidiary companies Additions/increase due to business combination

31 December 2010

(6)

(4)

-

(10)

4,100

905

4

163

5,172

-

134

5

-

139

-

-

-

-

-

-

(5)

(4)

-

(9)

Accumulated amortisation 31 December 2009 Increase from purchase of subsidiary companies Disposals Amortisation for the year

137

98

2

-

237

31 December 2010

137

227

3

-

367

3,963

678

1

163

4,805

Net book value 31 December 2010 Amortisation expenses for the year

237

72

Annual Report 2011 Thanachart Bank Public Company Limited

153


(Unit: Million Baht) Separate financial statements For the year ended 31 December 2011 Computer

Intangible assets from business

Computer

software under

combination

software

development

Total

Cost 31 December 2010 Increase from Entire Business Transfer

-

501

99

600

3,613

238

-

3,851

Additions

-

300

225

525

Transfer

-

160

(160)

3,613

1,199

164

4,976

-

115

-

115

Amortisation for the year

115

71

-

186

31 December 2011

115

186

-

301

31 December 2010

-

-

-

-

Increase during the year

-

25

-

25

31 December 2011

-

25

-

25

3,498

988

164

4,650

31 December 2011

-

Accumulated amortisation 31 December 2010

Allowance for impairment

Net book value 31 December 2011 Amortisation expenses for the year Remaining amortisation period (years)

186 8.3 years

0 – 9.9 years

(Unit: Million Baht)

Separate financial statements For the year ended 31 December 2010 Computer

Computer software

software

under development

Total

Cost 31 December 2009

390

113

503 97

Additions

27

70

Transfer

84

(84)

501

99

600

31 December 2009

72

-

72

Amortisation for the year

43

-

43

115

-

115

386

99

485

31 December 2010

-

Accumulated amortisation

31 December 2010 Net book value 31 December 2010 Amortisation expenses for the year

43

73

154

Annual Report 2011 Thanachart Bank Public Company Limited


As at 31 December 2011, the Bank and its subsidiaries have computer software which have been fully amortised but are still in use with original costs, before deducting accumulated amortisation, amounting to approximately Baht 40 million (separate financial statement: Baht 7 million). 19.

Goodwill As at 31 December 2011 and 2010, goodwill stated in the consolidated financial statements are as follows. (Unit: Million Baht) Consolidated financial statements 2011 Goodwill - beginning of the year Increase during the year 2010 Goodwill - ending of the year

20.

2010

Separate financial statements 2011

2010

15,750

10

-

-

-

15,740

15,740

-

15,750

15,750

15,740

-

Other assets (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011 Accrued premium insurance income

2010

2011

2010

440

444

-

-

1,553

949

1,547

281

1,052

1,024

725

311

57

676

48

670

392

411

388

208

197

172

184

172

-

326

-

183

Deposit

276

331

255

173

Estimated insurance claims recoveries

264

187

-

-

Receivable from clearing house

25

391

-

-

Deposit from derivative contracts

357

148

357

100

Others

817

645

578

125

5,430

5,704

4,082

2,223

Other receivables Accrued interest and dividend income receivables VAT refundable Prepaid leasehold rights Other receivables - VAT paid in advance for customers Suspense accounts between head office and branches

Total Less: Allowance for impairment Other assets - Net

(307) 5,123

(575) 5,129

(257) 3,825

(29) 2,194

74

Annual Report 2011 Thanachart Bank Public Company Limited

155


21.

Deposits

21.1 Classified by type of deposits (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2010

Current

7,129

7,222

7,227

2,487

Saving

169,196

181,350

170,386

87,765

61

61

61

61

2

5,297

2

-

52,172

154,231

86,450

68,894

133,560

39,394

133,560

16,737

73,920

145,101

73,932

66,847

436,040

532,656

471,618

242,791

Promissory notes Certificates of deposit Fixed deposits - Less than 6 months - 6 months and up to 1 year - Over 1 year Total deposits

21.2 Classified by currency and countries (Unit: Million Baht) Consolidated financial statements 2011

Baht

2010

Domestic

Foreign

435,796

1

Total

Domestic

Foreign

Total

435,797

532,253

1

532,254

US Dollar

84

20

104

160

25

185

Other currencies

22

117

139

90

127

217

435,902

138

436,040

532,503

153

532,656

Total

(Unit: Million Baht) Separate financial statements 2011

2010

Domestic

Foreign

471,374

1

US Dollar

84

Other currencies

Baht

Total

Total

Domestic

Foreign

Total

471,375

242,614

-

242,614

20

104

24

13

37

22

117

139

35

105

140

471,480

138

471,618

242,673

118

242,791

75

156

Annual Report 2011 Thanachart Bank Public Company Limited


22.

Interbank and money market items (liabilities) (Unit: Million Baht) Consolidated financial statements 2010

2011 At call

Term

Total

At call

Term

Total

Domestic Bank of Thailand and the FIDF

-

3,065

3,065

1,427

2,601

4,028

700

10,032

10,732

174

4,823

4,997

3,100

7,234

10,334

24

3,206

3,230

Other financial institutions

17,015

9,705

26,720

14,361

6,635

20,996

Total domestic items

20,815

30,036

50,851

15,986

17,265

33,251

US Dollar

3

8,599

8,602

81

6,832

6,913

Euro

-

-

-

-

24

24

Baht currency

241

457

698

95

262

357

Total foreign items

244

9,056

9,300

176

7,118

7,294

21,059

39,092

60,151

16,162

24,383

40,545

Commercial banks Specialised financial institutions

Foreign

Total

(Unit: Million Baht) Separate financial statements 2011 At call

2010

Term

Total

At call

Term

Total

Domestic Bank of Thailand and the FIDF

-

3,064

3,064

-

2,600

2,600

681

8,779

9,460

19

2,450

2,469

3,100

7,234

10,334

-

3,206

3,206

Other financial institutions

17,420

9,705

27,125

11,176

3,885

15,061

Total domestic items

21,201

28,782

49,983

11,195

12,141

23,336

US Dollar

3

8,599

8,602

61

5,928

5,989

Euro

-

-

-

-

24

24

Baht currency

241

457

698

95

262

357

Total foreign items

244

9,056

9,300

156

6,214

6,370

21,445

37,838

59,283

11,351

18,355

29,706

Commercial banks Specialised financial institutions

Foreign

Total

76

Annual Report 2011 Thanachart Bank Public Company Limited

157


As at 31 December 2011, a subsidiary company has loans from financial institutions that require it to comply with certain conditions, as summarised follows. (a)

A long-term loans amounting to Baht 773 million, repayable in 48 monthly installments from the date of loan drawdown, with interest charged at the average MLR less a fixed percentage per annum, payable monthly. The loans are secured by the assignment of collection rights over hire purchase receivables of the subsidiary company with a value of not less than 125 percent of the loan balances, and the transfer of ownership of the vehicles for which collection rights are assigned, as well as the assignment of collection rights over deposit accounts and related interest of the subsidiary company.

In addition, the subsidiary has to maintain the terms and

conditions as specified in the loan agreement i.e. to maintain a debt to equity ratio of not more than 8:1 and to maintain non-performing receivables at not more than 10 percent of total hire purchase receivables. (b)

A long-term loans amounting to Baht 275 million, repayable in 36 monthly installments from the date of loan drawdown, with interest charged at fixed interest rate per annum, payable monthly. The loan is secured by the assignment of collection rights over hire purchase/financial lease receivables of the subsidiary company, and the transfer of ownership of vehicles, with a value of not less than 110 percent of the loan balances that were drawn down. In addition, the subsidiary has to maintain the terms and conditions as specified in the loan agreement i.e. to maintain a debt to equity ratio of not more than 8:1.

(c)

A long-term loans amounting to Baht 6 million, repayable in 42 monthly installments from the date of loan drawdown, with interest charged at the average MLR less a fixed percentage per annum, payable monthly. The loans are secured by the assignment of collection rights over hire purchase receivables of the subsidiary company with a value of not less than 125 percent of the loan balances, and the transfer of ownership of the vehicles for which collection rights are assigned, as well as the assignment of collection rights over deposit accounts and related interest of the subsidiary company. In addition, the subsidiary has to maintain the terms and conditions as specified in the loan agreement i.e. to maintain a debt to equity ratio of not more than 8:1 and to maintain non-performing receivables at not more than 10 percent of total hire purchase receivables.

77

158

Annual Report 2011 Thanachart Bank Public Company Limited


23.

Debt issued and borrowings As at 31 December 2011 and 2010, the balance of debt issued and domestic borrowings, which stated in Baht, are as follows: (Unit: Million Baht) Interest rate

Consolidated

Separate financial statements

financial statements

per annum (as at Type of borrowings

31 December 2011)

Maturity date

2011

2010

2011

2010

Perpetual subordinated hybrid bonds

8.60 percent

Dissolution

7,130

7,130

7,130

7,130

5.25 percent

2019 and 2024

5,000

5,000

5,000

5,000

5.00 - 5.50 and 6.00

2015 - 2020

23,000

23,000

23,000

13,000

issued under Tier I (a) Subordinated hybrid bonds issued under Tier II (b) Subordinated debentures issued under Tier II (c - f)

percent

Bills of exchange

0 - 3.25 percent

At call

Bills of exchange

0.50 - 4.65 percent

2012 - 2013

Promissory note Borrowings - Department of

57

11

56

1

217,999

139,574

222,148

106,961

4.75 percent

At call

942

-

-

-

0 - 0.50 percent

2012 - 2017

169

234

169

-

254,297

174,949

257,503

132,092

Alternative Energy Development and Efficiency Total debt issued and borrowings

(a)

On 22 April 2010, the Bank issued 7,130,000 name registered of perpetual, noncumulative, subordinated, hybrid Tier 1 bonds, with a face value of Baht 1,000 each, and sold them to two major shareholders of the Bank. The bonds mature upon dissolution or liquidation of the Bank. The bonds are unsecured and non-convertible and bear interest at a rate equal to the highest interest rate for a six-month fixed deposit plus 6 percent per annum, payable semi-annually. The Bank has a call option to early redeem the bonds at par if the condition specified are met.

(b)

On 24 July 2009, the Bank issued 5,000,000 name registered subordinated hybrid bonds, unsecured, unconvertible debentures with debenture holders’ representative, with a face value of Baht 1,000 each. Of these, 3.5 million units mature in 2019 and bear interest at rate of 5.25 percent per annum for the first five years, and 5.5 percent per annum for the sixth to tenth years, while 1.5 million units mature in 2024 and bear interest at rate of 5.25 percent per annum for the first five years, 6.0 percent per annum for the sixth to tenth years and 6.5 percent per annum for the eleventh to fifteenth years, payable quarterly. The Bank has a call option to early redeem these debentures at par and has option to postpone principal and/or interest payment date if the conditions as specified are met.

78

Annual Report 2011 Thanachart Bank Public Company Limited

159


(c)

On 9 May 2008, the Bank issued 5,000,000 name registered subordinated, unsecured, unconvertible debentures with no debenture holders’ representative, with a face value of Baht 1,000 each. The debentures mature in 2015 and bear interests at rate of 5.1 percent per annum for the first three years, and 6 percent per annum for the fourth to seventh years, payable quarterly.

(d)

On 3 April 2009, the Bank issued 2,000,000 name registered subordinated, unsecured, unconvertible debentures with debenture holders’ representative, with a face value of Baht 1,000 each. The debentures mature in 2019 and bear interest at fixed interest rates of 5.25 percent per annum for the first three years, 5.75 percent per annum for the fourth to seventh years, and 6.5 percent per annum for the eighth to tenth years, payable quarterly. The Bank has a call option to early redeem these debentures at par if the conditions specified are met.

(e)

On 2 April 2010, the Bank issued 6,000,000 name registered subordinated, unsecured, unconvertible debentures with debenture holders’ representative, with a face value of Baht 1,000 each. The debenture mature in 2020 and bear interests at fixed interest rate of 5 percent per annum for the first five years and 5.5 percent per annum for the sixth to tenth years, payable quarterly. The Bank has a call option to early redeem these debentures at par if the conditions specified are met.

(f)

On 19 June 2009, SCIB issued 10,000,000 unsecured subordinated debentures with a face value of Baht 1,000 each. The debentures mature in 2019 and bear interests at fixed interest rates of 5.50 percent per annum for the first three years, 6.00 percent per annum for the fourth to seventh years, and 6.50 percent per annum for the eighth to tenth years. Interest is payable quarterly. SCIB has a call option to early redeem these debentures at par if the conditions specified are met. On 20 June 2011, SCIB early redeemed all debentures at par value with no gain (loss) on the transaction. Thanachart Bank has issue debentures to replace these SCIB’s debentures with the same interest rates, terms, and conditions. The BOT has given approval in principle to counting such subordinated debentures as Tire II of Thanachart Bank when the entire business transfer between Thanachart Bank and SCIB is completed. This is in accordance with the BOT’s letter for the entire business of SCIB.

79

160

Annual Report 2011 Thanachart Bank Public Company Limited


24.

Provisions (Unit: Million Baht) Consolidated financial statement For the year ended 31 December 2011

Balance as at 1 January 2011

Loss from

Employee

Obligations of

litigation

benefits

off-balance

89

43

285

483

900

-

2,272

-

-

2,272

-

3

-

-

3

2

360

39

90

491

-

Others

Total

The cumulative effect of the changes in the accounting policy for employee benefits Increase from purchase of subsidiary company Increase during the year Decrease from disposal of a subsidiary company

(1)

(3)

-

Utilised

(1)

(387)

-

Reversal of provisions

(4)

(335)

Balance as at 31 December 2011

85

(57)

(54)

1,953

-

270

516

(4) (445) (393) 2,824 (Unit: Million Baht)

Consolidated financial statement For the year ended 31 December 2010

Balance as at 1 January 2010

Loss from

Obligations of off-

litigation

balance

Others

Total

18

-

9

27

60

420

290

770

11

-

297

308

Utilised

-

-

(10)

(10)

Reversal of provisions

-

(135)

(60)

(195)

285

526

900

Increase from purchase of subsidiary company Increase during the year

Balance as at 31 December 2010

89

80

Annual Report 2011 Thanachart Bank Public Company Limited

161


(Unit: Million Baht) Separate financial statement For the year ended 31 December 2011 Obligations

Balance as at 1 January 2011

Loss from

Employee

of off-

litigation

benefits

balance

19

2

-

92

113

-

356

-

-

356

-

1,395

-

-

1,395

Others

Total

The cumulative effect of the changes in the accounting policy for employee benefits Employee benefits for staff transferred from SCIB Increase from entire business transfer

64

259

231

402

956

Increase during the year

1

50

39

18

108

Utilised

-

(54)

-

-

(54)

Reversal of provisions

-

(253)

-

-

(253)

270

512

Balance as at 31 December 2011

84

1,755

2,621 (Unit: Million Baht)

Separate financial statement For the year ended 31 December 2010 Loss from litigation

Others

18

4

22

Increase during the year

1

94

95

Utilised

-

(4)

(4)

Balance as at 1 January 2010

Balance as at 31 December 2010

19

Total

94

113

Employee Benefits Employee benefits under defined benefit plans recognised in part of profit or loss in the statements of comprehensive income for the year ended 31 December 2011 consist of the followings: (Unit: Million Baht)

Current service cost Interest cost

Consolidated financial

Separate financial

statement

statement

2011

2011

149

82

81

41

Loss on curtailment

(160)

-

Termination benefits

337

-

Actuarial gain

(47)

(73)

Total employee benefits

360

50

81

162

Annual Report 2011 Thanachart Bank Public Company Limited


The principal actuarial assumptions used to calculate the defined benefit obligations are as follows: (Percent per annum) Consolidated financial

Separate financial

statement

statement

2011

2011

Discount rate

4.07 - 4.70

4.09

Future salary increase rate

6.00 - 6.50

6.00

Average staff turnover rate (depending on age)

0.00 - 42.11

0.85 - 21.51

3.00

-

Inflation rate

During the year 2011, Thanachart Bank received the transfer of 6,368 employees from SCIB, this accorded with a resolution passed by a Board of Directors’ meeting of Thanachart Bank and is approved by the BOT. SCIB also transferred employee benefits liabilities related to the transferred employees amounting to Baht 1,395 million to Thanachart Bank, together with another Baht 337 million of accrued employee expenses. Under the employee transfer agreement, rights and benefits of employees will be determined counting consecutively from their existing length of service. 25.

Insurance contract liabilities (Unit: Million Baht) Consolidated financial

Separate financial

statement

statement

2011 Life policy reserve

2010

2011

2010

29,831

25,961

-

-

Loss reserve and outstanding claims

3,441

1,141

-

-

Unearned premium reserve

2,659

2,461

-

-

223

211

-

-

36,154

29,774

-

-

Other liabilities under insurance policies Total

Subsidiaries presented life policy reserve under long-term insurance contracts at the higher amount of the net level premium reserve method (NPV) and the gross level premium method (GPV). As a result of this change, life insurance policy reserve liabilities of a subsidiary company as at 31 December 2011 was increased by Baht 649 million, which was recognised in profit or loss.

82

Annual Report 2011 Thanachart Bank Public Company Limited

163


From July to December 2011, there was widespread flooding in Thailand. The floods have an effect to the parties insured by the subsidiary companies. However, the subsidiary companies have assessed and recorded the impact of this situation in their financial statements. They believe that no further significant loses will be incurred. 26.

Other liabilities (Unit: Million Baht) Consolidated financial statements 2011 Other payables

2010

Separate financial statements 2011

2010

1,253

912

1,038

249

435

731

435

731

69

83

208

196

300

163

300

163

-

1,762

-

348

330

568

330

568

Accrued interest payable

3,267

1,852

3,413

1,084

Corporate income tax payable

2,431

2,327

-

999

Accrued expense

3,855

3,137

3,078

1,421

306

98

-

-

2,857

2,159

1,977

372

15,103

13,792

10,779

6,131

Suspense cash received from account receivables Insurance premium payable Unearned income from hire purchase Deposit from derivative contracts Provision for income tax

Payable from clearing house Others Total other liabilities

27.

Share capital During 8 - 19 April 2010, the Bank called up additional paid-up share capital of 3,579,045,631 shares with a par value of Baht 10 totaling Baht 35,790,456,310 and registered an additional share capital on 30 April 2010, and as a result the Bank had issued and paid-up share capital equals to Baht 55,136,649,030. The parent company exercised both its own entitlement and the unexercised entitlement of the minority shareholders, and as a result the parent company increased its shareholding from 50.92 percent to 50.96 percent.

83

164

Annual Report 2011 Thanachart Bank Public Company Limited


28.

Other components of equity (Unit: Million Baht) Consolidated financial statements 2011

2010

Separate financial statements 2011

2010

-

-

Surplus from business combination under (123)

(123)

Debt instruments

364

399

287

254

Equity instruments

488

742

143

70

852

1,141

430

324

(60)

common control Revaluation surplus (deficit) on investments Revaluation surplus on investments Available-for-sale investments

Total Revaluation deficit on investments Available-for-sale investments Debt instruments Equity instruments

(252)

(119)

(184)

(4)

(3)

(1)

(3)

(71)

(34)

(94)

(259)

(193)

(219)

(154)

593

948

211

170

143

323

-

-

613

1,148

211

170

-

Held-to-maturity investments (transfer from available-for-sale investments) Total Total revaluation surplus (deficit) on investments Share of other comprehensive income of associates Total

29.

Statutory reserve Pursuant to Section 116 of the Public Limited Companies Act B.E. 2535, the Bank is required to set aside to a statutory reserve at least 5 percent of its net profit after deducting accumulated deficit brought forward (if any), until the reserve reaches 10 percent of the registered capital. The statutory reserve is not available for dividend distribution. As at 31 December 2011, the Bank allocated Baht 333.4 million of net income for the year 2011 to the statutory reserve (2010: Baht 285.9 million).

84

Annual Report 2011 Thanachart Bank Public Company Limited

165


30.

Capital funds The primary objectives of the Bank’s capital management are to maintain the Bank’s ability to continue as a going concern and to maintain a capital adequacy ratio in accordance with the Act on Undertaking of Banking business B.E. 2551. As at 31 December 2011 and 2010, capital funds of the Bank consist of the following: (Unit: Million Baht) 2011

2010

55,137

55,137

Share premium

2,101

2,101

Perpetual subordinated hybrid bonds (Hybrid Tier I)

7,130

7,130

968

537

Retained earnings - unappropriated

12,042

6,430

Total

77,378

71,335

Tier I Issued and fully paid up share capital

Statutory reserve

Less: goodwill Total

(15,740)

-

61,638

71,335

26,000

17,000

3,391

1,532

Total

29,391

18,532

Total Tier I and Tier II

91,029

89,867

64

31

91,093

89,898

Tier II Subordinated debentures Reserve for assets classified as normal

Add: Net revaluation surplus on investment in equity securities Total capital funds

On 25 August 2011, the Board of Directors’ meeting of Thanachart Bank passed a resolution to allocate Baht 312 million of net income for the six-month period ended 30 June 2011 amounting to statutory reserve. The remaining net income of such period, amounting Baht 5,930 million, was allocated as capital funds of the Bank. In addition, the BOT granted a waiver for Thanachart Bank to hold more SCIB’s shares than permitted by law, for the purposes of the business transfer. The BOT also permitted the Bank not to include SCIB in the financial business group until the date of completion of liquidation, while the computation of the ratio of the capital to risk assets and contingent liabilities includes the assets and contingent liabilities of SCIB until the date of SCIB return its banking license.

85

166

Annual Report 2011 Thanachart Bank Public Company Limited


As at 31 December 2011 and 2010, the Bank’s capital ratios, calculated based on the BOT’s regulation relating to the calculation of capital funds announced by the BOT, and including additional permission from the BOT, are as follows: 2011

2010 Minimum

Minimum

Capital ratio

requirement

Capital ratio

requirement

of the Bank

by BOT

of the Bank

by BOT

Total capital to risk assets (percent)

13.72

8.50

14.75

8.50

Total Tier I to risk assets (percent)

9.28

4.25

11.71

4.25

The Bank will disclose qualitative and quantitative information regarding capital maintenance as at 31 December 2011 in accordance with the Notification of the Bank of Thailand Re: Public Disclosure of Capital Maintenance Information for Commercial Banks on its website at www.thanachartbank.co.th, within April 2012. In addition, the Bank had disclosed the latest capital maintenance information as at 30 June 2011 on its website since October 2011. 31.

Dividends Dividends

Dividends on net income for

Approved by

Million Baht

Baht

Shareholders on 7 April 2011

2,205

0.40

1,083

0.56

Annual General Meeting of the

the year 2009

32.

Dividend per share

Annual General Meeting of the

the year 2010 Dividends on net income for

Total dividends

Shareholders on 7 April 2010

Interest income Interest income for the years ended 31 December 2011 and 2010 consisted of the following: (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2,237

1,054

1,365

403

78

82

24

13

4,114

3,653

2,023

1,708

Loans

20,774

14,760

9,413

4,336

Hire purchase and financial lease

17,011

15,232

16,722

14,937

Total interest income

44,214

34,781

29,547

21,397

Interbank and money market items Investments and trading transactions Investments in debt securities

2010

86

Annual Report 2011 Thanachart Bank Public Company Limited

167


33.

Interest expenses Interest expenses for the years ended 31 December 2011 and 2010 consisted of the following: (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2010

Deposits

8,973

5,960

5,766

3,512

Interbank and money market items

1,289

506

1,555

293

1,955

1,914

1,132

1,034

- Subordinated debentures

2,145

1,727

1,889

1,312

- Others

5,432

1,455

4,606

1,217

Borrowings

1

3

-

-

Fees and services expense on borrowing

3

1

11

7

19,798

11,566

14,959

7,375

Contribution fee to the Deposit Protection Agency Issues debt instruments

Total interest expenses

34.

Fees and service income Fees and service income for the years ended 31 December 2011 and 2010 consisted of the following: (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2010

Fees and service income Acceptance, aval and guarantees

271

228

102

46

ATM and electronic banking services

669

575

161

104

Hire purchase fee income

901

857

875

830

Insurance brokerage fee income

222

226

982

733

Management fees

479

533

6

5

Credit card fee

698

395

366

96

Others

618

555

412

216

3,858

3,369

2,904

2,030

Total fees and service income Fees and service expenses Net fees and service income

(500) 3,358

(519) 2,850

(144) 2,760

(45) 1,985

87

168

Annual Report 2011 Thanachart Bank Public Company Limited


35.

Gains on trading and foreign exchange transactions Gains on trading and foreign exchange transactions for the years ended 31 December 2011 and 2010 consisted of the following: (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011

2011

2010

2010

Foreign exchange and derivatives relating to foreign exchange

871

360

518

132

interest rate

1

1

-

-

Debt securities

21

(6)

46

12

Equity securities

(5)

211

-

-

3

4

-

-

891

570

564

144

Foreign exchange and derivatives relating to

Others Total

36.

Gains (losses) on investments Gains (losses) on investments for the years ended 31 December 2011 and 2010 consisted of the following: (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2010

182

267

81

108

-

-

Gains (losses) on disposal Available-for-sale securities Held-to-maturity securities

(1)

2

Other investments

80

-

87

24

-

22

33

-

-

-

(17)

-

Investments in associated and subsidiary companies Gain on revaluation of investment at equity from business combination Reversal of impairment on general investments (losses)

(41)

21

(4)

18

Gain on transfer of investments

372

-

-

-

Total

712

314

60

148

88

Annual Report 2011 Thanachart Bank Public Company Limited

169


During the year, a subsidiary company has transferred investment which classified as held-to-maturity debt securities amounting to Baht 8,439 million to be trading in order to comply with the measurement of liabilities reserve for long-term insurance contracts of which the value of the liabilities reserve is depend on the changes in discounted market interest rate. As a result of this transfer, a gain of Baht 329 million was recognised in profit or loss. The subsidiary company also transferred investments classified as available-forsale securities amounting to Baht 2,000 million to be trading with a gain on transfer of Baht 43 million. 37.

Directors’ remuneration Directors’ remuneration represents the benefits paid to the directors of the Bank and public subsidiary companies in accordance with Section 90 of the Public Limited Companies Act, exclusive of salaries and related benefits payable to directors who hold executive positions but including the payment of remuneration amounting to Baht 19 million to the Bank’s and its subsidiaries’ directors, which was approved by the Annual General Meeting of Shareholders of the Bank and its subsidiaries.

38.

Impairment loss of loans and debt securities Impairment loss of loans and debt securities for the years ended 31 December 2011 and 2010 consisted of the following: (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2,548

2,035

1,388

(1)

1,159

(1)

-

2010

Bad debts and doubtful accounts Loans to customers Interbank and money market items

31

38

59

(40)

(2)

(40)

78

15

123

2,149

1,422

1,280

Amortisation of revaluation allowance for debts restructured during the year Loss from debt restructuring (reversal) Total (1)

(35) 2,504

(2)

(2)

Net of gain on revaluation adjustment on the receivables which were transferred from SCIB after deduction of additional allowance for doubtful accounts for those receivables.

(2)

Net of gain on revaluation adjustment on the receivables which were transferred from SCIB after deduction of additional loss on debt restructuring for those receivables.

89

170

Annual Report 2011 Thanachart Bank Public Company Limited


39.

Income tax expense Corporate income tax was calculated on profit for the year, after adding back and deducting with expenses and provisions which are disallowable for tax computation purposes and deducting income which is exempted for tax computation purposes. The Bank has no corporate income tax liability for the year 2011 since after adding back and deducting expenses and/or income which are disallowed for tax computation purposes, there is a net loss. Therefore, corporate income tax that was paid during the year 2011 will be presented as “Prepaid corporate income tax� in the statement of financial position.

40.

Components of other comprehensive income Components of other comprehensive income for the years ended 31 December 2011 and 2010 of the following: (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2010

Other comprehensive income Available-for-sale investments: Unrealised gains (losses) during the year

(495)

421

(40)

(152)

losses that included in profit or loss

182

267

81

108

Gain from reclassified type of investments

(43)

-

-

-

(356)

688

41

(180)

204

-

(536)

892

41

Less: Reclassification of adjustment for the realised

(44)

Share of other comprehensive income in associated companies (loss) Other comprehensive income (loss) for the year

(44)

90

Annual Report 2011 Thanachart Bank Public Company Limited

171


41.

Earnings per share Basic earnings per share is calculated by dividing profit for the years attributable to equity holders of the Bank (excluding other comprehensive income) by the weighted average number of ordinary shares in issue during the year. For the years ended 31 December Consolidated financial statements 2010

2011

2011

2010

Profit for the period (Million Baht)

7,671

8,777

6,668

5,719

Weighted average number of shares (Million shares)

5,514

4,563

5,514

4,563

1.39

1.92

1.21

1.25

Earnings per share (Baht/share)

42.

Separate financial statements

Provident fund The Bank, its subsidiaries and its employees have jointly established a provident fund in accordance with the Provident Fund Act B.E. 2530. Employees contributed to the fund monthly, at rates of 3 -10 percent of their basic salaries, and the Bank and its subsidiaries contributed to the fund at stipulated rates. The fund will be paid to the employees upon termination of employment in accordance with the fund rules. During the year 2011, the Bank and its subsidiaries contributed Baht 443 million to the fund (separate financial statements: Baht 253 million).

91

172

Annual Report 2011 Thanachart Bank Public Company Limited


43.

Related party transactions During the years, the Bank and its subsidiaries had significant business transactions with related parties. These transactions have been concluded on commercial terms and bases agreed upon in the ordinary course of businesses between the Bank and those companies. Below is a summary of those transactions. (Unit: Million Baht) For the years ended 31 December Consolidated

Separate

financial statements

financial statements

2011

2011

2010

Transfer pricing policy

2010

(For the year 2011)

Transactions occurred during the years Parent company Purchase of investment in

-

3,411

-

3,411

158

15,463

158

15,417

At market price

13,792

38,856

13,792

38,856

At market price

(Related gain)

1

3

1

3

Purchase of subordinated

-

3,057

-

3,057

-

3,636

-

3,636

100

109

100

109

subsidiary company Purchase of debt securities Sales of debt securities

debentures Sales of subordinated debentures Purchase of fixed assets and other assets Interest income

At the rate agreed under the contract which based on appraisal value

4

6

-

-

At interest rate of 4.7 - 9.15 percent per annum

Fee and service income

1

14

-

2

Insurance/Life insurance income

-

1

-

-

26

39

26

39

Income on supporting service

At the rate agreed under the service contract

Other income Interest expenses

2

10

-

-

300

262

300

262

At interest rate of 0.75 - 2.90 and 8.00 percent per annum

Rental expenses

115

152

93

127

At the rate agreed under the rental contracts

Other expenses Dividend payment

48

43

44

41

1,124

552

1,124

552

As declared

92

Annual Report 2011 Thanachart Bank Public Company Limited

173


(Unit: Million Baht) For the years ended 31 December Consolidated

Separate

financial statements

financial statements

2011

2010

2011

Purchase of debt securities

35,358

58,436

7,057

4,953

At market price

Sales of debt securities

35,736

58,234

28,188

51,688

At market price

Transfer pricing policy

2010

(For the year 2011)

Transactions occurred during the years (continued) Subsidiary companies

(Related gain (loss))

18

41

4

143

-

143

-

At market price

6,147

1,227

6,147

1,227

At market price

21

-

21

-

-

14

-

3

Sales of fixed assets

-

14

-

-

Consulting fee on purchase of

-

-

-

34

-

-

196

80

Purchase of investments in equity

(9)

instruments Purchase/sales of forward exchange contracts (Related gain) Purchase of fixed assets and other assets

investment in subsidiary Interest income

At interest rate of 2.45 – 4.10 and 6.13 – 7.90 percent per annum

Dividend income

-

-

1,532

525

Fee and service income

-

-

153

53

Discount income on insurance

-

-

888

658

-

-

1,018

222

As declared At the rate agreed under the service contract

premium Income on supporting service

At the rate agreed under the service contract

Other income

-

-

-

8

Interest expenses

-

-

661

40

At interest rate of 0.25 – 4.40 percent per annum

Fee and service expenses

-

-

10

3

At the rate agreed under the service contracts

Rental expenses

-

-

7

6

Other expenses

-

-

167

164

At the rate agreed under the rental contracts

93

174

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) For the years ended 31 December Consolidated

Separate

financial statements

financial statements

2011

2011

2010

Transfer pricing policy

2010

(For the year 2011)

Transactions occurred during the years (continued) Associated companies Purchase of investment in

-

161

-

161

80

350

-

350

At market price

360

17,046

300

16,492

At market price

-

213

-

213

-

24

-

22

369

199

59

-

subsidiary company Purchase of debt securities Sales of debt securities Sales of investment in a subsidiary company (Related gain) Interest income

At interest rate of 2.25 - 3.25 and 3.75 7.25 percent per annum

Fee and service income

7

14

-

-

At the rate agreed under the service contract

Non-life insurance/Life insurance

-

1

-

-

-

2

-

-

82

70

81

69

income Other income Interest expenses

At interest rate of 0.25 - 2.80 and 5.25 percent per annum

Rental expenses

13

11

12

11

At the rate agreed under the rental contracts

Insurance premium/life insurance

1

4

-

-

12

12

8

9

-

6,228

-

6,228

At the rate agreed under the contract

premium expenses Other expenses Related companies Purchase of investment in subsidiary company Purchase of debt securities Sales of debt securities (Related gain) Purchase/sales of forward

1,139

3,229

1,139

3,229

18,447

3,937

18,447

3,937

2

1

2

1

443,693

179,266

437,552

179,266

At market price

At market price

exchange contracts (Related loss) Sales of fixed assets and other

(114)

(9)

(59)

(9)

-

58

-

58

(Related gain)

-

12

-

12

Sales of property foreclosed

-

373

-

373

(Related gain)

-

37

-

37

assets

94

Annual Report 2011 Thanachart Bank Public Company Limited

175


(Unit: Million Baht) For the years ended 31 December Consolidated

Separate

financial statements

financial statements

2011

2011

2010

Transfer pricing policy

2010

(For the year 2011)

Transactions occurred during the years (continued) Related companies (continued) Interest income

658

286

241

113

At interest rate of 2.00 - 7.90 percent per annum

Dividend income Fee and service income

33

47

2

3

As declared

7

19

-

-

At the rate agreed under the service contract

Insurance/Life insurance income Income on supporting service

4

-

-

-

17

17

17

17

At the rate agreed under the service contract

Other income Interest expenses

24

33

2

2

431

297

355

262

At interest rate of 0.125 – 6.10, 7.40 , 8.00 and 8.60 percent per annum

Rental expenses

125

96

88

58

At the rate agreed under the rental contracts

Insurance premium/life insurance

-

125

-

-

1

91

-

-

17

46

8

31

1,113

558

1,081

531

premium expenses Fee and service expenses Other expenses Dividend payment

At the rate agreed under the contract

As declared

In addition to the transactions mentioned above, during the year ended 31 December 2011, SCIB transferred non-performing loans amounting to Baht 9,062 million and properties foreclosed amounting to Baht 3,083 million to TS Asset Management Co., Ltd., a subsidiary company. The transfer prices are mutually agreed with reference to financial advisors have opinion that they are fair values.

95

176

Annual Report 2011 Thanachart Bank Public Company Limited


The outstanding balances of the above transactions during the years ended 31 December 2011 and 2010 have been shown at the average balance at the end of each month as follows: (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2010

Parent company Loans to customers

19

22

-

-

161

442

161

441

3,896

5,901

3,896

5,901

Interbank and money market items (assets)

-

-

397

3,931

Loans to customers

-

-

4,470

1,760

Deposits

-

-

3,646

466

Interbank and money market items (liabilities)

-

-

18,045

626

Debt issued and borrowings

-

-

2,179

1,010

7,512

5,757

2,434

-

297

386

166

253

2,265

1,723

2,019

1,477

1,626

2,874

435

287

17,481

9,131

6,745

3,538

Deposits

1,266

4,536

1,087

4,269

Interbank and money market items (liabilities)

7,581

6,598

6,922

6,478

Debt issued and borrowings

6,936

3,846

6,586

3,340

Deposits Debt issued and borrowings Subsidiary companies

Associated companies Loans to customers Deposits Debt issued and borrowings Related companies Interbank and money market items (assets) Loans to customers

96

Annual Report 2011 Thanachart Bank Public Company Limited

177


As at 31 December 2011 and 2010, the significant outstanding balances of the above transactions are as follows: (Unit: Million Baht) Consolidated financial statements 2011 Liabilities

Assets Interbank

Loans to

Interbank

and money

Investments

customers

market

- debt

and interest

Other

items

securities

receivables

assets

Deposits

and money

Debt

market

issued and

Other

items

borrowings

liabilities

Commitments

Parent company Thanachart Capital Plc.

-

-

17

24

71

-

3,644

87

-

-

-

-

8

93

-

1,500

-

-

-

-

-

-

26

-

100

-

-

Seacon Development Plc.

-

-

591

1

-

-

-

-

-

Thai Hua Rubber Plc.

-

-

1,993

-

195

-

150

1

10

-

-

796

-

9

-

-

-

-

1,122

-

-

26

-

7,933

3,494

102

2,580

Associated companies MBK Plc. Siam Samsung Life Insurance Co., Ltd. Related companies

Synphaet Co., Ltd. The Bank of Nova Scotia Srithai Superware Plc.

-

-

577

-

15

-

-

-

76

Krungthai Card Plc.

-

582

3,533

-

7

-

-

-

-

Chaimongkol Refinery Co., Ltd. Other related companies

-

-

2,471

-

-

-

-

-

3

-

-

1,324

194

851

35

932

317

305

1,122

582

11,302

253

1,267

7,968

9,820

507

2,974

97

178

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) Consolidated financial statements 2010 Liabilities

Assets Interbank

Loans to

Interbank

and money

Investments

customers

and money

Debt

market

- debt

and interest

Other

market

issued and

Other

items

securities

receivables

assets

Deposits

items

borrowings

liabilities

Commitments

Parent company Thanachart Capital Plc.

-

45

21

24

61

-

3,636

71

-

MBK Plc.

-

-

-

9

144

-

1,800

10

30

Ratchthani Leasing Plc.

-

-

6,503

-

37

-

-

-

-

-

-

-

-

98

-

-

-

-

-

-

-

-

98

-

-

-

-

Seacon Development Plc.

-

-

736

1

1

-

-

-

58

Thai Hua Rubber Plc.

-

-

1,777

-

191

-

150

1

1,359

Associated companies

Siam Samsung Life Insurance Co., Ltd. Siam City Insurance Co., Ltd. Related companies

Krung Thai IBJ Leasing Co., Ltd. Advanced Info Service Plc. Synphaet Co., Ltd.

-

-

593

-

-

-

-

-

-

-

244

24

6

2,041

-

200

39

19

-

-

654

-

9

-

-

-

28

4,056

-

-

1

-

30

500

224

-

435

-

-

3

-

6,853

3,494

76

1,458

Krungthai Card Plc.

-

964

9,344

9

4

-

-

-

-

Wangkanai Sugar Co., Ltd.

-

-

1,658

-

15

-

-

-

48

-

-

2,840

-

95

-

-

-

3

320

175

1,575

302

1,076

37

780

18

227

4,811

1,428

25,725

355

3,870

6,920

10,560

439

3,230

Government Savings Bank The Bank of Nova Scotia

Chaimongkol Refinery Co., Ltd. Other related companies

98

Annual Report 2011 Thanachart Bank Public Company Limited

179


(Unit: Million Baht) Separate financial statements 2011 Liabilities

Assets Interbank

Loans to

Interbank

and money

Investments

customers

and money

Debt

market

- debt

and interest

Other

market

issued and

Other

items

securities

receivables

assets

items

borrowings

liabilities

Deposits

Commitments

Parent company 86

-

-

85

-

-

-

-

-

-

55

-

7

737

95

241

-

1,124

170

10

-

57

-

215

2,000

62

-

-

-

-

114

-

140

-

-

-

-

9,824

12

872

-

-

46

-

-

-

-

2

-

131

885

20

-

-

-

7,870

-

24

-

-

-

17

-

-

22

22

56

5

-

67

-

-

-

-

8

93

-

1,500

11

-

-

-

-

-

26

-

100

-

-

Seacon Development Plc.

-

-

591

1

-

-

-

-

-

Thai Hua Rubber Plc.

-

-

1,993

-

195

-

150

1

10

Synphaet Co., Ltd.

-

-

796

-

9

-

-

-

-

Krungthai Card Plc.

-

582

3,533

-

7

-

-

-

-

Thanachart Capital Plc.

-

-

-

19

71

-

-

-

-

-

34,298

-

-

-

353

-

6

150

-

-

3

-

-

-

-

-

-

3,643

Subsidiary companies Siam City Bank Plc. Thanachart Group Leasing Co., Ltd. Thanachart Securities Plc. Thanachart Insurance Co., Ltd. Thanachart Life Assurance Co., Ltd. Thanachart Broker Co., Ltd. TS Asset Management Co., Ltd. Siam City Life Assurance Co., Ltd. Ratchthani Leasing Plc. Other subsidiary companies Associated company MBK Plc. Siam Samsung Life Insurance Co., Ltd. Related companies

Srithai Superware Plc.

-

-

577

-

15

-

-

-

76

The Bank of Nova Scotia

1,122

-

-

21

-

7,933

3,494

89

2,580

Other related companies

-

-

751

157

851

34

932

115

84

1,272

582

26,310

397

36,878

8,373

13,968

759

3,514

99

180

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) Separate financial statements 2010 Liabilities

Assets Interbank

Loans to

Interbank

and money

Investments

customers

market

- debt

and interest

Other

items

securities

receivables

assets

Deposits

and money

Debt

market

issued and

Other

items

borrowings

liabilities

Commitments

Parent company Thanachart Capital Plc.

-

-

-

622

60

-

3,636

70

-

25

-

-

-

-

9

-

-

-

-

-

934

-

9

-

-

-

-

-

-

-

2

-

624

-

13

30

-

-

-

46

173

-

166

116

10

-

-

-

218

-

443

-

51

-

-

-

-

100

127

-

-

-

-

-

-

52

2

45

19

-

61

-

-

-

-

8

139

-

1,800

10

30

-

-

736

1

1

-

-

-

58

Subsidiary companies Siam City Bank Plc. Thanachart Group Leasing Co., Ltd. Thanachart Securities Plc. Thanachart Insurance Co., Ltd. Thanachart Life Assurance Co., Ltd. Thanachart Broker Co., Ltd. Other subsidiary companies Associated company MBK Plc. Related companies Seacon Development Plc. Thai Hua Rubber Plc.

-

-

1,677

-

153

-

150

-

1,358

Advanced Info Service Plc.

-

4

23

-

2,039

-

200

3

19

Synphaet Co., Ltd.

-

-

654

-

9

-

-

-

28

Krungthai Card Plc.

-

-

2,013

-

4

-

-

-

-

The Bank of Nova Scotia

430

-

-

3

-

5,948

3,494

76

1,458

Other related companies

11

-

810

274

900

38

780

223

11

466

4

6,899

1,276

3,659

7,081

10,226

623

3,002

As at 31 December 2011 and 2010, the Bank has loans to subsidiary companies as mentioned in Note 12.11 to the financial statements. As at 31 December 2011, the Bank and its subsidiaries have investments amounting to Baht 672 million (Baht 252 million in the separate financial statements) in related companies in which they are related by means of members of their management being shareholders and/or directors of those companies (2010: Baht 596 million in the consolidated financial statements and Baht 62 million in the separate financial statements).

100

Annual Report 2011 Thanachart Bank Public Company Limited

181


As at 31 December 2011 and 2010, the Bank and its subsidiaries have the following related parties transactions with executive employees of the Bank and companies within Thanachart Group from management level up, including related persons who together with these employees: (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011 Loans Deposits

2010

2011

2010

49

59

45

24

535

487

535

386

Directors and management’s remuneration During the years 2011 and 2010 the Bank and its subsidiaries paid the following benefits to their key management personnel, including directors, totaled 147 persons and 177 persons respectively (the separate financial statements: 50 persons and 34 persons respectively): (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011 Short-term employee benefits

2010

2011

2010

597

495

254

162

Post-employment benefits

10

-

3

-

Termination benefits

26

-

-

-

633

495

257

162

101

182

Annual Report 2011 Thanachart Bank Public Company Limited


44.

Financial information by segment

44.1 Financial position and results of operations classified by business activity The financial position as at 31 December 2011 and 2010, and the results of operations for the years ended 31 December 2011 and 2010, classified by domestic and foreign operations, are as follow: (Unit: Million Baht) Consolidated financial statements 2011 Domestic

Foreign

operations

operations

Eliminations

Total

Total assets

986,181

15,245

(115,366)

886,060

Interbank and money market items (assets)

106,642

8,066

(51,507)

63,201

Investments

145,222

7,132

(4,009)

148,345

42,552

-

(41,129)

1,423

628,174

-

(18,271)

609,903

471,618

-

(35,578)

436,040

78,910

15,010

(33,769)

60,151

258,446

-

(4,149)

254,297

Investments in subsidiary and associated companies Loans to customers and accrued interest receivables Deposits Interbank and money market items (liabilities) Debt issued and borrowings

(Unit: Million Baht) Consolidated financial statements 2010

Total assets Interbank and money market items (assets) Investments

Domestic

Foreign

operations

operations

Eliminations

Total

928,250

10,758

(66,005)

873,003

98,005

196

(13,141)

85,060

126,284

10,505

3,233

140,022

77,219

-

(75,042)

2,177

582,595

-

(1,069)

581,526

532,974

-

(318)

532,656

43,894

10,291

(13,640)

40,545

175,115

-

(166)

174,949

Investments in subsidiary and associated companies Loans to customers and accrued interest receivables Deposits Interbank and money market items (liabilities) Debt issued and borrowings

102

Annual Report 2011 Thanachart Bank Public Company Limited

183


(Unit: Million Baht) Consolidated financial statements 2011

Interest income Interest expenses Net interest income

Domestic

Foreign

operations

operations

45,076

218

(20,661)

(37)

900

(19,798)

24,415

181

(180)

24,416

(4)

(1,365)

3,358

1,231

2,128

(7,754)

5,109

Net fee and service income (losses)

4,727

Net insurance/Life insurance income

897

-

12,824

39

Other operating income Other operating expenses

Eliminations (1,080)

Total 44,214

(21,909)

-

32

(21,877)

Impairment loss of loans and debt securities

(2,525)

-

21

(2,504)

Corporate income tax

(2,948)

-

-

(2,948)

Income before non-controlling interests

15,481

216

(8,015)

7,682

(Unit: Million Baht) Consolidated financial statements 2010 Domestic

Foreign

operations

operations

35,056

274

(549)

34,781

(11,695)

(47)

176

(11,566)

23,361

227

(373)

23,215

Net fee and service income (losses)

3,992

-

(1,142)

2,850

Net insurance/Life insurance income

1,447

-

Other operating income

5,774

15

(17,272)

(3)

452

(16,823)

Impairment loss of loans and debt securities

(2,130)

-

(19)

(2,149)

Corporate income tax

(4,548)

-

Income before non-controlling interests

10,624

Interest income Interest expenses Net interest income

Other operating expenses

239

Eliminations

905 (1,534)

(1,711)

Total

2,352 4,255

(4,548) 9,152

103

184

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) Separate financial statements 2011

Total assets Interbank and money market items (assets) Investments

Domestic

Foreign

operations

operations

877,959

Eliminations

Total

15,245

(15,151)

878,053

70,048

8,066

(15,151)

62,963

107,409

7,132

-

114,541

40,842

-

-

40,842

604,770

-

-

604,770

471,618

-

-

471,618

59,424

15,010

257,503

-

Investments in subsidiary and associated companies Loans to customers and accrued interest receivables Deposits Interbank and money market items (liabilities) Debt issued and borrowings

(15,151) -

59,283 257,503

(Unit: Million Baht) Separate financial statements 2011 Domestic

Foreign

operations

operations

29,519

40

(11)

29,548

(14,959)

(11)

11

(14,959)

14,560

29

-

14,589

Net fee and service income

2,760

-

-

2,760

Other operating income

4,412

-

-

4,412

(13,671)

-

-

(13,671)

(1,422)

-

-

(1,422)

29

-

6,668

Interest income Interest expenses Net interest income

Other operating expenses Impairment loss of loans and debt securities Income before non-controlling interests

6,639

Eliminations

Total

The financial position as at 31 December 2010 and the results of operations for the year then ended, per separate financial statements are the result of domestic operations only.

104

Annual Report 2011 Thanachart Bank Public Company Limited

185


44.2 Financial positions and results of operations classified by business type The Bank and its subsidiaries’ business operations involve 6 principal segments: (1) Banking business; (2) Securities business; (3) Life insurance business; (4) Non-life insurance business; (5) Asset management business; and (6) Hire purchase and finance lease business. Below is the consolidated financial information of the Bank and its subsidiaries by segment. (Unit: Million Baht) For the year ended 31 December 2011 Hire purchase/ finance

Other

Banking

Securities

insurance

insurance

managemen

lease

busines

business

business

business

business

t business

business

s

43,225

194

1,143

Interest income Interest expenses

Life

Non-life

Asset

(20,440)

(17)

22,785

177

3,946

504

(16)

-

-

(317)

Net interest income

122

-

-

1,143

122

273

175

Eliminations Consolidated 125

(1,043)

44,214

(85)

(98)

(21)

863

(19,798)

188

77

104

(180)

24,416

-

9

285

(1,365)

3,358

-

-

-

1,231

2,128

Net fee and service income (losses) Net insurance income Other operating income Other operating expenses

(5) 1,214

10,682

1,359

501

43

32

12

234

(18,897)

(1,397)

(467)

(636)

(119)

(28)

(365)

(7,754) 32

(21,877)

5,109

Impairment loss of loans and debt securities

(2,706)

220

(37)

(2)

21

(2,504)

Corporate income tax

(1,873)

(170)

-

(426)

-

(255)

-

(141)

(21)

(62)

-

(2,948)

13,937

473

418

483

180

12

194

Income before non-controlling interest

(8,015)

7,682

(Unit: Million Baht) For the year ended 31 December 2010

Interest income Interest expenses Net interest income

Life

Non-life

Banking

Securities

insurance

insurance

Other

business

business

business

business

business

33,961

129

829

60

304

(502)

34,781

(11,652)

(5)

-

-

(38)

129

(11,566)

22,309

124

829

60

266

(373)

23,215

3,242

547

(120)

(4)

327

(1,142)

2,850

-

-

579

868

-

905

2,352

Eliminations Consolidated

Net fee and service income (losses) Net insurance income Other operating income Other operating expenses

3,703

1,504

312

52

218

(1,534)

4,255

(14,579)

(1,438)

(379)

(474)

(405)

452

(16,823)

Impairment loss of loans and debt securities Corporate income tax

(2,159)

-

-

-

29

(19)

(2,149)

(3,576)

(216)

(442)

(208)

(106)

-

(4,548)

8,940

521

779

294

329

(1,711)

9,152

Income before non-controlling interests

105

186

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) As at 31 December 2011 Hire purchase/ Non-life

Life

finance

Asset

lease

Other

business

business

business

Banking

Securities

insurance

insurance management

business

business

business

business

Eliminations

Consolidated

Interbank and money market items Investments

97,346

376

359

233

872

50

321

(36,356)

63,201

114,541

223

32,814

4,776

-

-

-

(4,009)

148,345

40,842

667

678

303

-

-

62

(41,129)

1,423

604,770

1,953

99

-

8,267

12,176

909

(18,271)

609,903

Investments in subsidiary and associated companies Loans to customers and accrued interest receivable - net Land, premises and 8,365

54

155

106

-

45

17

17

8,759

Other assets

equipment - net

46,572

966

798

3,290

3,128

77

65

(467)

54,429

Total assets

912,436

4,239

34,903

8,708

12,267

12,348

1,374

(100,215)

886,060

(Unit: Million Baht) As at 31 December 2010

Interbank and money market items

Life

Non-life

Banking

Securities

insurance

insurance

Other

business

business

business

business

business

Eliminations Consolidated

84,277

1,684

1,263

296

197

(2,657)

85,060

103,227

767

28,794

3,801

200

3,233

140,022

75,271

763

776

347

62

(75,042)

2,177

579,541

1,345

58

-

1,651

(1,069)

581,526

8,731

79

128

19

29

-

8,986

Other assets

31,498

2,033

703

926

58

20,014

55,232

Total assets

882,545

6,671

31,722

5,389

2,197

(55,521)

873,003

Investments Investments in subsidiary and associated companies Loans to customers and accrued interest receivable - net Land, premises and equipment net

106

Annual Report 2011 Thanachart Bank Public Company Limited

187


45.

Encumbrance of assets As at 31 December 2011 and 2010, the Bank and its subsidiaries have the following assets, presented at book value, which are subject to restriction. (Unit: Million Baht) Consolidated

Separate

financial statements

financial statements

2011

2010

2011

2010

Investment in securities Guarantee placed with the registrar

7,448

6,214

-

-

20

283

20

20

Collateral for derivatives agreements

-

190

-

190

Security for electricity usage

-

13

-

-

739

522

739

221

963

1,554

923

31

9,170

8,776

1,682

462

Placed with court for stay of execution

Property foreclosed Immovable assets subject to buyback options or first refusal rights Immovable assets subject to purchase or sell agreements with clients but currently being settled in installments or through transfer of ownership

46.

Commitments and contingent liabilities As at 31 December 2011 and 2010, significant commitments and contingent liabilities consisted of:

46.1 Commitments (Unit: Million Baht) Consolidated financial statements 2011 Aval to bills

2010

Separate financial statements 2011

2010

386

654

386

238

Guarantees of loans

1,230

422

1,230

2

Liability under unmatured import bills

1,105

571

1,105

120

Letter of credits

2,626

2,456

2,626

672

Committed (but not draw) overdraft

28,548

45,740

28,548

5,757

Others

21,405

24,234

21,385

5,266

55,300

74,077

55,280

12,055

Other obligations

Total

In addition, the Bank and its subsidiaries have commitments in respect of foreign exchange contracts, interest rate swap contracts, cross currency and interest rate swap contracts and gold futures, as mentioned in Note 9 to the financial statements. 107

188

Annual Report 2011 Thanachart Bank Public Company Limited


46.2 During the years 2001 and 2002, the Bank entered into agreements to transfer nonperforming loans and receivables of approximately Baht 296 million to TAMC. The Bank is still jointly liable for a share of the gains and losses arising from TAMC’s management of these non-performing assets to be calculated at the end of the fifth year and tenth year, counting from 1 July 2001. If there are losses, the Bank is liable for all initial losses up to 20 percent of the transfer price, while further losses of up to another 20 percent of the transfer price are to be shared equally between the Bank and TAMC, and TAMC is liable for all remaining losses. Such gains and losses will be determined based on the accumulated value of collections made on the assets at the date of determination, minus transfer costs and all operating expenses of TAMC, including interest on the debt instruments issued to purchase the loans and receivables. The gain or loss cannot be estimated at this stage, but as at 31 December 2011, the Bank has estimated its share of the losses which may arise from the management of the non-performing assets at approximately Baht 89 million. This amount has been presented as a part of provisions in the statements of financial position. 46.3 The Bank has entered into agreements to sell housing loans/transfer rights to the Secondary Mortgage Corporation, under which it is committed to compensate the Corporation for losses from uncollected housing loans up to a maximum of 20 percent of the valuation of the said receivables. As at 31 December 2011, its maximum obligation is Baht 2 million. 46.4 As at 31 December 2011, the Bank and its subsidiaries have commitments to pay the service fees in relation to property foreclosed, computer system services and other services, including commitments in respect of office rental and related service fees under long-term rental contracts, as follow: (Unit: Million Baht)

Year

Consolidated

Separate

financial statements

financial statements

Other

Parent

Other

Parent

Subsidiary

parties

company

parties

company

companies

2012

1,675

69

1,613

52

47

2013

1,253

9

1,196

2

-

2014 onward

4,043

1

3,609

1

-

In addition, the Bank has obligations to pay an administrative fee to a subsidiary company, determined at actual cost plus a margin, for the period stipulated in the agreement.

108

Annual Report 2011 Thanachart Bank Public Company Limited

189


46.5 Commitments of SCIB from transfer of business from Bangkok Metropolitan Bank Public Company Limited and transfer of non-performing assets to Sukhumvit Asset Management Company Limited SCIB entered into a business transfer agreement with Bangkok Metropolitan Bank Plc. (“BMB”), effective from 1 April 2002, and transferred its assets and those of BMB to Petchburi Asset Management Co., Ltd. (“PAM”), before they were transferred to Sukhumvit Asset Management Co., Ltd. (“SAM”). Subsequently, SCIB transferred its entire business, including commitments and agreements with PAM and SAM, to Thanachart Bank, effective from 1 October 2011. Thanachart Bank thus has commitments as a result of such transfer. However, the commitments of FIDF to SCIB have been transferred to/assumed by Thanachart Bank as the purchaser of SCIB’s shares from FIDF. As at 31 December 2011, outstanding obligations are summarised below. a)

There was an outstanding difference of Baht 93 million, as a result of the transfer of assets to SAM. These comprised receivables awaiting collection and the difference is presented under the caption of “Differences as a result of assets transferred to SAM” in the statements of financial position. Such amounts mainly relate to transfers of guarantee claims, for which there are pending issues with regard to proof the rights of claim or the assets transferred being qualified in accordance with the conditions set out in the transfer agreements. Such differences are now being examined and/or negotiated among Thanachart Bank, SAM and the FIDF for final resolution. As at 31 December 2011, such differences consist of (i) Baht 10 million of transactions incurred directly by SCIB, for which full allowance for doubtful debts has been set aside, and (ii) Baht 83 million of transactions incurred by BMB. If losses arise on the latter and collection cannot be made from SAM, the FIDF will consider compensating for all losses from (ii). Thanachart Bank’s management believes that no significant further losses will arise since the transfers of those assets corresponded to the principles of the agreements made among SCIB, BMB and SAM and the agreement given by FIDF.

109

190

Annual Report 2011 Thanachart Bank Public Company Limited


b)

SAM is re-examining certain previously transferred assets (both of SCIB and BMB) in order to determine whether to transfer the assets back, to request price adjustments or to request settlement together with interest. The major pending issue relates to the proof of rights of claim over these assets. As at 31 December 2011, the transferred assets which SAM is re-examining totaling Baht 370 million consist of (i) Baht 28 million of transactions incurred directly by SCIB, for which full allowance for doubtful loss has set aside under the caption of “Provision for liabilities” in the statements of financial position, and (ii) Baht 342 million of transactions incurred by BMB. If losses arise from (ii), Thanachart Bank will receive compensation for loss from FIDF and any adjusting transactions will be within the limit of the funds set aside by FIDF to compensate losses in such cases, amounting to approximately Baht 258 million. In addition, SAM is now negotiating with Thanachart Bank to request interest payment on the assets transferred back, or a price adjustment.

c)

Lawsuits in which SCIB is involved as a result of the transfer of business from BMB amounting to approximately Baht 11,280 million, as disclosed under contingent liabilities in Note 47 to the financial statements.

d)

Outstanding letters of guarantee.

The FIDF deposited an amount equal to the loss compensation limit with Thanachart Bank in the FIDF’s account. Such deposit account is to compensate for losses incurred as a result of the transfer of business from BMB, if such losses are actually incurred due to the outstanding issues described in a), b), c) and d) above. As at 31 December 2011, the deposit account of the FIDF with Thanachart Bank to fund the payment of compensation for losses has an outstanding balance of approximately Baht 791 million. In addition, there is a memorandum of agreement concerning conditions for additional loss compensation if Thanachart Bank incurs losses in relation to the two lawsuits discussed in c), with claims totaling Baht 9,965 million. However, Thanachart Bank and SAM had a meeting and mutually agreed a resolution to such pending issues. Thanachart Bank believes that no significant further losses will be incurred, other than losses for which it has already set aside full allowance for doubtful debts and/or amount that will compensate by FIDF.

110

Annual Report 2011 Thanachart Bank Public Company Limited

191


46.6 Commitments arising from sale of ordinary shares of Siam City Securities As a result of the sale of all ordinary shares of Siam City Securities in August 2011, SCIB is obligated to pay compensation to indemnify the buyer from pending lawsuits including litigation in which Siam City Securities is pursuing collection of debt amounts and/or future litigation which made claims against its debtor that arose before the disposal date of such shares. Moreover, SCIB undertakes to compensate the buyer for any expenses incurred whenever the buyer or Siam City Securities provide SCIB with written notification of reasons for such compensation, together with evidence, for up to 3 years from the share transfer date. Such commitment of SCIB has transferred to Thanachart Bank at the date of the entire business transfer. However, Thanachart Bank’s management believes that no further losses will be incurred. 47.

Litigation As at 31 December 2011, the Bank and its subsidiaries have contingent liabilities amounting to approximately Baht 24,026 million (separate financial statements: Baht 22,940 million) in respect of litigation. However, the Bank and its subsidiaries’ management have already made certain provision for contingency losses, and for the remaining portion the management believes that no losses will result and therefore no liabilities are currently recorded. Part of the contingent liabilities of the litigation mentioned above amounting to Baht 22,446 million represents claims filed against SCIB as defendant or co-defendant in lawsuits. These comprise both lawsuits directly involving SCIB and obligations arising as a result of the transfer of business from BMB; (i) Baht 11,166 million relates to SCIB’s own lawsuits, with Baht 8,594 million of this amount relating to a tort case in which the actual loss is only Baht 202 million. The Court of First Instance has already ordered the case be dismissed and it is in the process of being reviewed by the Supreme Court. The total sum of claims in cases relating directly to SCIB’s business, after deducting this tort case, is thus Baht 2,572 million; and (ii) The remaining portion of Baht 11,280 million represents cases in which SCIB is involved as a result of the transfer of business from BMB, and for which SCIB is entitled to compensation for actual losses incurred if such losses are in accordance with the conditions agreed with the FIDF (Baht 9,586 million of this amount relates a single case brought by a debtor that BMB had already transferred to SAM before SCIB received the transfer of business from BMB, and SCIB believes that the lawsuit has been brought against the wrong party, and not SCIB’s responsibility, SCIB’s management believes that SCIB has no liability in respect of such case.). As at 31 December 2011, SCIB had already made provisions for contingent liabilities totaling Baht 62 million for those lawsuits under (i) above where the Court of First Instance has already judged in favor of the plaintiff. SCIB’s management believes that there will be no significant future losses as a result of the remaining cases. However, all contingent liabilities and provisions for contingent liabilities were transferred from SCIB to Thanachart Bank on the date of the entire business transfer.

111

192

Annual Report 2011 Thanachart Bank Public Company Limited


In addition, SCIB was requested to make restitution as a result of a person forging SCIB’s documents and using such counterfeit documents. However, SCIB has already filed a complaint against the person who produced and used counterfeit documents so as to proceed with a legal action. SCIB believes that no liability will arise from such restitution claim. 48.

Letter of guarantees As at 31 December 2011, the Bank and its subsidiaries had letter of guarantees issued by the Bank and its subsidiaries, amounting approximately Baht 24 million, placed for electricity usage of the branches (separate financial statements: Baht 23 million).

49.

Financial instruments Financial instruments are any contracts which give rise to both a financial assets of one enterprise and a financial liability or equity instruments of another enterprise.

49.1 Credit risk Credit risk is the risk that the party to a financial instrument will fail to fulfill an obligation, causing the Bank and its subsidiaries to incur a financial loss. The amount of maximum credit risk exposure is the carrying amount of the financial assets less provision for losses as stated in the statements of financial position and the risk of commitments from avals, guarantees of loans, other guarantees and derivative contracts. In addition, the Bank and its subsidiaries manage credit risk by the means of careful consideration of credit approval process, analysis of risk factors and, the ability to service debt of customers, and a credit review process, which examines and reviews the quality of the loan portfolio so as to prevent and provide a remedy for problem loans in the future. 49.2 Market risk Market risk is the risk that changes in interest rates, foreign exchange rates and securities prices may have an effect on the Bank and its subsidiaries’ foreign currency position and investment status. As such, market risk consists of interest rate risk, foreign exchange risk and equity position risk.

112

Annual Report 2011 Thanachart Bank Public Company Limited

193


a)

Interest rate risk

Interest rate risk is the risk that the value of financial instrument will fluctuate as a result of changes in market interest rates. The Bank and its subsidiaries manage the changes in interest rate risk by means of an appropriate structuring of holdings in assets and liabilities with different repricing dates, taking into account the direction of market interest rates, in order to generate a suitable yield while maintaining risk at acceptable levels. Such management is under the supervision of the Asset and Liabilities Management Committee. As at 31 December 2011 and 2010, financial assets and liabilities classified by types of interest rate are as follows: (Unit: Million Baht) Consolidated financial statements 2011

Transactions

Floating

Fixed

Non-

interest

interest

interest

rate

rate

bearing

Total

Financial assets Cash

-

-

16,006

16,006

23,000

32,178

8,137

63,315

-

-

1,536

1,536

12

135,851

11,885

147,748

-

-

1,423

1,423

313,265

321,747

208

635,220

-

-

858

858

-

-

25

25

174,519

255,821

5,700

436,040

7,419

51,274

1,458

60,151

Liabilities payable on demand

-

-

2,131

2,131

Derivatives liabilities

-

-

2,886

2,886

Debt issued and borrowings

-

254,297

-

254,297

-

-

851

851

-

-

306

306

Interbank and money market items Derivatives assets Investments Investments in associated companies (1)

Loans to customers

Receivable from purchase and sale securities and derivatives Other assets - receivable from clearing house Financial liabilities Deposits Interbank and money market items

Payable from purchase and sale securities and derivatives Other liabilities - payable from clearing house (1)

The outstanding balances of loans to customers which have floating interest rates or fixed interest rates include loans on which interest recognition is discontinued

113

194

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) Consolidated financial statements 2010

Transactions

Floating

Fixed

Non-

interest

interest

interest

rate

rate

bearing

Total

Financial assets Cash

-

-

15,298

15,298

1,166

77,559

6,462

85,187

-

-

3,117

3,117

5,840

121,092

12,000

138,932

-

-

2,177

2,177

253,297

353,273

281

606,851

-

-

2,870

2,870

-

-

391

391

185,346

341,372

5,938

532,656

7,175

31,398

1,972

40,545

Liabilities payable on demand

-

-

3,127

3,127

Derivatives liabilities

-

-

941

941

3,996

170,930

23

174,949

-

-

4,054

4,054

-

-

98

98

Interbank and money market items Derivatives assets Investments Investments in associated companies Loans to customers(1) Receivable from purchase and sale securities and derivatives Other assets - receivable from clearing house Financial liabilities Deposits Interbank and money market items

Debt issued and borrowings Payable from purchase and sale securities and derivatives Other liabilities - payable from clearing house (1)

The outstanding balances of loans to customers which have floating interest rates or fixed interest rates include loans on which interest recognition is discontinued

Annual Report 2011 Thanachart Bank Public Company Limited

114

195


(Unit: Million Baht) Separate financial statements 2011

Transactions

Floating

Fixed

Non-

interest

interest

interest

rate

rate

bearing

Total

Financial assets Cash

-

-

16,004

16,004

22,966

32,113

8,002

63,081

-

-

1,532

1,532

12

103,875

10,450

114,337

-

-

40,842

40,842

308,348

308,229

135

616,712

-

-

65

65

175,709

290,112

5,797

471,618

6,496

51,274

1,513

59,283

Liabilities payable on demand

-

-

2,131

2,131

Derivatives liabilities

-

-

2,877

2,877

Debt issued and borrowings

-

257,503

-

257,503

-

-

268

268

Interbank and money market items Derivatives assets Investments Investments in subsidiary and associated companies (1)

Loans to customers

Receivable from purchase and sale securities and derivatives Financial liabilities Deposits Interbank and money market items

Payable from purchase and sale securities and derivatives (1)

The outstanding balances of loans to customers which have floating interest rates or fixed interest rates include loans on which interest recognition is discontinued

196

Annual Report 2011 Thanachart Bank Public Company Limited

115


Separate financial statements 2010

Transactions

Floating

Fixed

Non-

interest

interest

interest

rate

rate

bearing

Total

Financial assets Cash

-

-

3,733

3,733

115

24,574

3,732

28,421

Derivatives assets

-

-

928

928

Investments

-

48,897

601

49,498

-

-

73,121

73,121

42,707

283,667

175

326,549

-

-

1,733

1,733

91,918

149,844

1,029

242,791

3,809

25,190

707

29,706

Liabilities payable on demand

-

-

2,326

2,326

Derivatives liabilities

-

-

434

434

Debt issued and borrowings

-

132,092

-

132,092

-

-

1,733

1,733

Interbank and money market items

Investments in subsidiary and associated companies (1)

Loans to customers

Receivable from purchase and sale securities and derivatives Financial liabilities Deposits Interbank and money market items

Payable from purchase and sale securities and derivatives (1)

The outstanding balances of loans to customers which have floating interest rates or fixed interest rates include loans on which interest recognition is discontinued

With respect to financial instruments that carry fixed interest rates, the periods from the financial position date to the repricing or maturity date (whichever is the earlier) are presented below: (Unit: Million Baht) Consolidated financial statements 2011 Repricing or maturity date

Transactions

At call

Weighted

0-3

3 - 12

1-5

Over 5

months

months

years

years

average Total

interest rates Percent

Financial assets Interbank and money market items

-

29,523

2,655

-

-

32,178

1.27-2.49

Investments

-

14,772

46,447

57,851

16,781

135,851

3.19-4.47

3,626

22,243

15,445

212,320

68,113

321,747

8.10-9.82

89

169,399

77,929

8,404

-

255,821

3.12

Loans to customers Financial liabilities Deposits Interbank and money market items Debt issued and borrowings

13,458

32,220

5,379

217

-

51,274

999

133,517

103,060

16,700

21

254,297

2.29 4.06-4.75

116

Annual Report 2011 Thanachart Bank Public Company Limited

197


(Unit: Million Baht) Consolidated financial statement 2010 Repricing or maturity date

Transactions

At call

Weighted

0-3

3 - 12

1-5

Over 5

months

months

years

years

average Total

interest rates Percent

Financial assets Interbank and money market items Investments Loans to customers

147

76,912

500

-

-

77,559

1.75 – 2.21

-

23,980

26,872

47,241

22,999

121,092

3.18 – 3.33

6,968

48,134

40,693

198,372

59,106

353,273

5.48 – 7.60

Financial liabilities Deposits Interbank and money market items Debt issued and borrowings

53

193,904

125,726

21,689

-

341,372

1.65 – 1.98

7,015

19,901

3,076

1,406

-

31,398

1.52 – 1.55

1

109,296

38,415

23,185

33

170,930

2.63 – 2.83

(Unit: Million Baht) Separate financial statements 2011 Repricing or maturity date

Transactions

At call

Weighted

0-3

3 - 12

1-5

Over 5

months

months

years

years

average Total

interest rates Percent

Financial assets Interbank and money market items

-

29,546

2,567

-

-

32,113

3.24

Investments

-

13,136

42,218

47,283

1,238

103,875

3.19

3,473

22,197

14,921

199,900

67,738

308,229

8.10

Loans to customers Financial liabilities Deposits Interbank and money market items Debt issued and borrowings

89

203,677

77,942

8,404

-

290,112

3.01

13,458

32,220

5,379

217

-

51,274

0.25

56

135,642

105,084

16,700

21

257,503

4.05

(Unit: Million Baht) Separate financial statement 2010 Repricing or maturity date

Transactions

At call

Weighted

0-3

3 - 12

1-5

Over 5

months

months

years

years

average Total

interest rates Percent

Financial assets Interbank and money market items

-

24,574

-

-

-

24,574

1.75

Investments

-

7,477

18,319

14,542

8,559

48,897

3.33

3,595

11,225

17,886

193,959

57,002

283,667

7.58

1

82,136

61,182

6,525

-

149,844

1.98

6,835

16,365

602

1,388

-

25,190

1.53

1

87,700

31,391

13,000

-

132,092

2.63

Loans to customers Financial liabilities Deposits Interbank and money market items Debt issued and borrowings

117

198

Annual Report 2011 Thanachart Bank Public Company Limited


In addition, the average balances of the financial assets and liabilities of the Bank and its subsidiaries generating revenues and expenses, calculated based on the average balances outstanding during the years, and the average interest rate for the years 2011 and 2010 can be summarised as follows: (Unit: Million Baht) Consolidated financial statements For the years ended 31 December 2011 Average

2010 Average

Average

Average

balances

Interest

rate (%)

balances

Interest

rate (%)

Interbank and money market items

65,402

2,237

3.42

76,969

1,054

1.67

Investments and trading operations

4,950

78

1.58

5,164

82

2.04

Investment in debt securities

133,575

4,114

3.08

132,140

3,653

3.18

Loans/hire purchase and finance leases

667,896

37,785

5.66

537,667

29,992

6.22

447,955

10,928

2.44

538,925

7,874

1.67

56,551

1,289

2.28

47,226

506

1.27

215,485

7,581

3.52

132,292

3,186

2.58

Interest bearings financial assets

Interest bearings financial liabilities Deposits Interbank and money market items Debt issued and borrowings

(Unit: Million Baht) Separate financial statements For the years ended 31 December 2011 Average

2010 Average

Average balances

Average

balances

Interest

rate (%)

Interbank and money market items

29,786

1,365

4.58

30,968

403

1.30

Investments and trading operations

1,755

24

1.35

565

13

2.36

61,702

2,023

3.28

54,488

1,708

3.13

400,397

26,135

6.53

289,939

19,273

6.65

266,850

6,898

2.16

248,617

4,546

1.83

56,340

1,555

2.76

26,629

293

1.10

176,696

6,506

3.68

98,284

2,536

2.58

Interest

rate (%)

Interest bearings financial assets

Investment in debt securities Loans/hire purchase and finance leases Interest bearings financial liabilities Deposits Interbank and money market items Debt issued and borrowings

118

Annual Report 2011 Thanachart Bank Public Company Limited

199


b)

Foreign exchange risk

Foreign exchange risk is the risk that changes in foreign exchange rates may result in changes in the value of financial instruments, and fluctuations in revenues or the values of financial assets and liabilities. Since the Bank and its subsidiaries have foreign exchange transactions, it may be exposed to foreign exchange risk. However, the Bank and its subsidiaries have a policy to mitigate this foreign exchange exposure through management of its net exchange position and operation in accordance with a risk management policy which has been approved by their Board of Directors and is in strict accordance with BOT guidelines. The status of the Bank and its subsidiaries’ foreign currency balances as at 31 December 2011 and 2010 can be summarised as follows: (Unit: Million Baht) Consolidated financial statements 2011 US Dollar

Euro

Yen

Won

Others

Yuan

Foreign currency in the statements of financial position Cash Interbank and money market items

618

395

292

-

1

381

14,987

119

128

-

6

492

Investments

11,192

599

3,035

549

12,327

38

Loans to customers

13,186

234

486

-

-

101

Other assets

463

1

17

-

49

-

Total assets

40,446

1,348

3,958

549

12,383

1,012

104

21

1

-

-

117

8,602

-

-

-

-

-

Other liabilities

14

-

-

-

-

-

Total liabilities

8,720

21

1

-

-

117

31,726

1,327

3,957

549

12,383

895

Guarantees of loans

920

-

310

-

-

-

Liability under unmatured import bills

368

34

118

-

-

5

2,376

100

92

-

-

22

984

48

1

-

-

27

Deposits Interbank and money market items

Net Foreign currency commitments

Letter of credits Others

200

Annual Report 2011 Thanachart Bank Public Company Limited

119


(Unit: Million Baht) Consolidated financial statements 2010 US Dollar

Euro

Yen

Won

Others

Yuan

Foreign currency in the statements of financial position Cash Interbank and money market items

234

213

119

1

-

191

3,312

119

151

33

-

427

Investments

14,724

571

1,376

4,800

-

37

Loans to customers

11,350

289

30

-

-

54

Other assets

306

8

9

22

-

9

Total assets

29,926

1,200

1,685

4,856

-

718

185

72

2

-

-

143

8,119

24

-

-

-

-

Deposits Interbank and money market items Liability payable on demand

-

-

1

-

-

-

Other liabilities

1,803

-

9

-

-

-

Total liabilities

10,107

96

12

-

-

143

Net

19,819

1,104

1,673

4,856

-

575

36

22

-

-

-

-

Foreign currency commitments Guarantees of loans Liability under unmatured import bills

305

29

56

-

-

32

Letter of credits

2,134

112

103

-

-

28

Others

4,505

25

-

-

-

19

(Unit: Million Baht) Separate financial statements 2011 US Dollar

Euro

Yen

Won

Others

Yuan

Foreign currency in the statements of financial position Cash

619

395

292

-

1

381

Interbank and money market items

14,987

119

128

-

6

492

Investments

11,192

599

3,035

549

12,327

38

Loans to customers

13,183

234

486

-

Other assets

458

1

17

-

49

-

Total assets

40,439

1,348

3,958

549

12,383

1,012

Deposits

101

104

21

1

-

-

117

Interbank and money market items

8,602

-

-

-

-

-

Total liabilities

8,706

21

1

-

-

117

31,733

1,327

3,957

549

12,383

895

Net Foreign currency commitments Guarantees of loans

920

-

310

-

-

-

Liability under unmatured import bills

368

34

118

-

-

5

2,376

100

92

-

-

22

984

48

1

-

-

27

Letter of credits Others

120

Annual Report 2011 Thanachart Bank Public Company Limited

201


(Unit: Million Baht) Separate financial statements 2010 US Dollar

Euro

Yen

Won

Others

Yuan

Foreign currency in the statements of financial position Cash

134

Interbank and money market items

36

88

-

-

55

417

7

28

33

-

115

Investments

5,383

570

178

4,800

-

-

Loans to customers

3,609

30

-

-

-

3

Other assets

160

1

-

22

-

-

Total assets

9,703

644

294

4,855

-

173

37

7

-

-

-

133

7,195

24

-

-

-

-

Other liabilities

348

-

-

-

-

-

Total liabilities

7,580

31

-

-

-

133

Net

2,123

613

294

4,855

-

40

-

2

-

-

-

-

Deposits Interbank and money market items

Foreign currency commitments Guarantees of loans Liability under unmatured import bills

111

7

-

-

-

-

Letter of credits

625

44

-

-

-

-

Others

665

-

-

-

-

2

In addition, the Bank and its subsidiaries have commitments from foreign currency exchange contracts, cross currency and interest rate swap contracts and interest rate swap contracts which have to pay or received repayment in foreign currency that the Bank and its subsidiaries made for trading transactions or hedging transactions (banking book) as follow: (Unit: Million Baht) Consolidated financial statements 2011 US Dollar

Euro

Yen

Won

Yuan

Others

Foreign exchange contracts - Bought

32,441

1,002

386

-

-

552

- Sold

52,246

1,757

1,509

-

10,828

1,467

Cross currency and interest rate swap contracts - Bought

1,347

-

-

-

-

-

11,235

615

2,834

548

1,611

-

- Bought

1,453

-

-

-

-

-

- Sold

1,453

-

-

-

-

-

- Sold Interest rate swap contracts

121

202

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) Consolidated financial statements 2010 US Dollar

Euro

Yen

Won

Yuan

Others

Foreign exchange contracts - Bought

23,624

145

194

-

-

404

- Sold

30,779

754

721

-

-

1,090

Cross currency and interest rate swap contracts - Bought

6,874

-

-

-

-

-

21,091

599

1,187

4,786

-

-

- Bought

916

-

-

-

-

-

- Sold

916

-

-

-

-

-

- Sold Interest rate swap contracts

(Unit: Million Baht) Separate financial statements 2011 US Dollar

Euro

Yen

Won

Yuan

Others

Foreign exchange contracts - Bought

31,805

1,002

386

-

-

552

- Sold

52,883

1,757

1,509

-

10,828

1,467

Cross currency and interest rate swap contracts - Bought

1,347

-

-

-

-

-

11,235

615

2,834

548

1,611

-

- Bought

1,453

-

-

-

-

-

- Sold

1,453

-

-

-

-

-

- Sold Interest rate swap contracts

(Unit: Million Baht) Separate financial statements 2010 US Dollar

Euro

Yen

Won

Yuan

Others

Foreign exchange contracts - Bought

12,770

30

105

-

-

249

- Sold

11,292

124

448

-

-

407

Cross currency and interest rate swap contracts - Bought

4,476

-

-

-

-

-

- Sold

8,094

599

-

4,786

-

-

- Bought

302

-

-

-

-

-

- Sold

302

-

-

-

-

-

Interest rate swap contracts

122

Annual Report 2011 Thanachart Bank Public Company Limited

203


c)

Equity position risk

Equity position risk is the risk that changes in the market prices of equity securities which will result in fluctuations in revenue and the value of financial assets. The Bank and its subsidiaries have a policy to manage market risk by setting manageable limits on transactions, such as position limit and loss limits. The Risk Control Unit, which is separated from front office and back office functions, is responsible for control of risk and reporting on compliance with the various limits to the Board of Directors, related business unit and related management, in order to facilitate responsive risk management, under the supervision of the Investment Portfolio Committee. 49.3 Liquidity risk Liquidity risk is the risk that the Bank and its subsidiaries will be unable to liquidate their financial assets and/or procure sufficient funds to discharge their obligations in a timely manner, resulting in the Bank and its subsidiaries incurring a financial loss. The Bank and its subsidiaries manage liquidity risk by means of appropriate structuring of short-term and long-term sources of capital. In addition, the Bank and its subsidiaries have a policy to maintain liquidity to ensure that it has sufficient liquidity to meet both present and future requirements, under the supervision of the Asset and Liability Management Committee.

123

204

Annual Report 2011 Thanachart Bank Public Company Limited


Counting from the financial position date, the periods to maturity of financial instruments held as at 31 December 2011 and 2010 are as follows: (Unit: Million Baht) Consolidated financial statements 2011

Transactions

At call

Less than

Over

1 year

1 year

Unspecified

Total

Financial assets Cash

16,006

-

-

-

16,006

8,368

54,827

120

-

63,315

Derivatives assets

-

1,536

-

-

1,536

Investments

1

67,445

68,908

11,394

147,748

Investments in associated companies

-

-

-

1,423

1,423

47,672

193,205

394,343

-

635,220

-

858

-

-

858

-

25

-

-

25

176,616

249,835

9,589

-

436,040

21,081

35,306

3,764

-

60,151

2,131

-

-

-

2,131

-

2,886

-

-

2,886

999

217,447

28,721

7,130

254,297

-

851

-

-

851

-

306

-

-

306

Aval to bill

1

342

43

-

386

Guarantees of loans

-

1,230

-

-

1,230

624

481

-

-

1,105

86

2,540

-

-

2,626

41,732

6,138

2,061

2

49,933

Interbank and money market items

(1)

Loans to customers(2) Receivable from purchase and sale securities and derivatives Other assets - receivable from clearing house Financial liabilities Deposits Interbank and money market items Liability payable on demand Derivatives liabilities Debt issued and borrowings Payable from purchase and sale securities and derivatives Other liabilities - payable from clearing house Commitments

Liability under unmatured import bills Letter of credits Other commitments

(1) The outstanding balances of interbank and money market items at call included the item for which have defaulted on the repayment. (2) The outstanding balances of loans to customers at call included loans for which revenue recognition has been discontinued.

124

Annual Report 2011 Thanachart Bank Public Company Limited

205


(Unit: Million Baht) Consolidated financial statements 2010

Transactions

At call

Less than

Over

1 year

1 year

Unspecified

Total

Financial assets Cash

15,298

-

-

-

15,298

7,405

77,662

120

-

85,187

Derivatives assets

-

3,117

-

-

3,117

Investments

-

48,826

83,891

6,215

138,932

-

-

-

2,177

2,177

62,566

183,319

360,966

-

606,851

-

2,870

-

-

2,870

-

391

-

-

391

188,806

318,019

25,831

-

532,656

16,162

22,917

1,466

-

40,545

3,127

-

-

-

3,127

-

941

-

-

941

11

134,903

32,905

7,130

174,949

-

4,054

-

-

4,054

-

98

-

-

98

13

585

56

-

654

Guarantees of loans

354

57

11

-

422

Liability under unmatured import bills

156

415

-

-

571

Letter of credits

156

2,280

20

-

2,456

56,107

9,407

2,513

1,947

69,974

Interbank and money market items

(1)

Investments in associated companies (2)

Loans to customers

Receivable from purchase and sale securities and derivatives Other assets - receivable from clearing house Financial liabilities Deposits Interbank and money market items Liability payable on demand Derivatives liabilities Debt issued and borrowings Payable from purchase and sale securities and derivatives Other liabilities - payable from clearing house Commitments Aval to bill

Other commitments

(1) The outstanding balances of interbank and money market items at call included the item for which have defaulted on the repayment. (2) The outstanding balances of loans to customers at call included loans for which revenue recognition has been discontinued.

125

206

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) Separate financial statements 2011

Transactions

At call

Less than

Over

1 year

1 year

Unspecified

Total

Financial assets Cash

16,004

-

-

-

16,004

8,199

54,762

120

-

63,081

Derivatives assets

-

1,532

-

-

1,532

Investments

1

51,378

52,999

9,959

114,337

-

-

-

40,842

40,842

43,701

192,374

380,637

-

616,712

-

65

-

-

65

177,903

284,126

9,589

-

471,618

21,466

34,600

3,217

-

59,283

2,131

-

-

-

2,131

-

2,877

-

-

2,877

57

221,595

28,721

7,130

257,503

-

268

-

-

268

Aval to bill

1

342

43

-

386

Guarantees of loans

-

1,230

-

-

1,230

624

481

-

-

1,105

86

2,540

-

-

2,626

41,732

6,138

2,061

2

49,933

Interbank and money market items

Investments in subsidiary and associated companies (1)

Loans to customers

Receivable from purchase and sale securities and derivatives Financial liabilities Deposits Interbank and money market items Liability payable on demand Derivatives liabilities Debt issued and borrowings Payable from purchase and sale securities and derivatives Commitments

Liability under unmatured import bills Letter of credits Other commitments

(1) The outstanding balances of loans to customers at call included loans for which revenue recognition has been discontinued.

126

Annual Report 2011 Thanachart Bank Public Company Limited

207


(Unit: Million Baht) Separate financial statements 2010

Transactions

At call

Less than

Over

1 year

1 year

Unspecified

Total

Financial assets Cash

3,733

-

-

-

3,733

Interbank and money market items

3,847

24,574

-

-

28,421

Derivatives assets

-

928

-

-

928

Investments

-

21,046

27,892

560

49,498

-

-

-

73,121

73,121

9,847

106,319

210,383

-

326,549

-

1,733

-

-

1,733

Deposits

90,432

141,692

10,667

-

242,791

Interbank and money market items

11,351

16,907

1,448

-

29,706

2,326

-

-

-

2,326

Derivatives liabilities

-

434

-

-

434

Debt issued and borrowings

1

105,469

19,492

7,130

132,092

-

1,733

-

-

1,733

Aval to bill

3

179

56

-

238

Guarantees of loans

-

2

-

-

2

Liability under unmatured import bills

2

118

-

-

120

76

576

20

-

672

6,140

2,751

185

1,947

11,023

Investments in subsidiary and associated companies (1)

Loans to customers

Receivable from purchase and sale securities and derivatives Financial liabilities

Liability payable on demand

Payable from purchase and sale securities and derivatives Commitments

Letter of credits Other commitments

(1) The outstanding balances of loans to customers at call included loans for which revenue recognition has been discontinued.

127

208

Annual Report 2011 Thanachart Bank Public Company Limited


49.4

Fair value Fair value represents the amount for which an asset could be exchanged or a liability settled between knowledgeable, willing parties in an arm’s length transaction. The Bank and its subsidiaries have estimated the fair value of financial instruments as follows: a)

Financial assets

The method used for determining the fair value depends upon the characteristics of the financial instruments. The fair values of most financial assets are presented at the amount stated in the statement of financial position, including cash, interbank and money market items, derivatives assets, receivable from purchase and sale securities and derivatives, receivables from clearing house and loans. These financial assets have their fair value approximate to their respective carrying value since the values of these financial instruments are predominantly subject to market interest rates. Financial instruments with standard terms and conditions which are traded on an active and liquid market, such as investments, have their fair values determined by the quoted market price. b)

Financial liabilities

The fair values of financial liabilities, including deposits, interbank and money market items, liabilities payable on demand, derivatives liabilities, debt issued and borrowings, payable from purchase and sale securities and derivatives, and payable to clearing house are considered to approximate their respective carrying values for the same reasons as described above.

128

Annual Report 2011 Thanachart Bank Public Company Limited

209


As at 31 December 2011 and 2010, the book value and fair value of financial instruments of the Bank and its subsidiaries are as follow. (Unit: Million Baht) Consolidated financial statements 2011 Book value

2010 Fair value

Book value

Fair value

Financial assets Cash

16,006

16,006

15,298

15,298

Interbank and money market items

63,201

63,201

85,060

85,060

1,536

1,536

3,117

3,117

148,345

149,325

140,022

140,944

1,423

1,423

2,177

2,177

609,903

609,903

581,526

581,526

858

858

2,870

2,870

25

25

391

391

436,040

436,040

532,656

532,656

60,151

60,151

40,545

40,545

Liabilities payable on demand

2,131

2,131

3,127

3,127

Derivatives liabilities

2,886

2,886

941

941

254,297

254,297

174,949

174,949

851

851

4,054

4,054

306

306

98

98

Derivatives assets Investments Investments in associated companies Loans to customers Receivables from purchase and sale securities and derivatives Other assets - receivable from clearing house Financial liabilities Deposits Interbank and money market items

Debt issued and borrowings Payable from purchase and sale securities and derivatives Other liabilities - payable from clearing house

129

210

Annual Report 2011 Thanachart Bank Public Company Limited


(Unit: Million Baht) Separate financial statements 2011 Book value

2010 Fair value

Book value

Fair value

Financial assets Cash

16,004

16,004

3,733

3,733

Interbank and money market items

62,963

62,963

28,428

28,428

1,532

1,532

928

928

114,541

115,030

49,759

50,218

40,842

40,842

73,121

73,121

604,770

604,770

319,352

319,352

65

65

1,733

1,733

471,618

471,618

242,791

242,791

Derivatives assets Investments Investments in subsidiary and associated companies Loans to customers Receivables from purchase and sale securities and derivatives Financial liabilities Deposits Interbank and money market items

59,283

59,283

29,706

29,706

Liabilities payable on demand

2,131

2,131

2,326

2,326

Derivatives liabilities

2,877

2,877

434

434

257,503

257,503

132,092

132,092

268

268

1,733

1,733

Debt issued and borrowings Payable from purchase and sale securities and derivatives

49.5 Financial derivatives The Bank and its subsidiaries engage in financial derivatives activities as required in the normal course of their business to manage risk and to meet their clients’ needs. These financial derivatives include foreign exchange contracts, cross currency and interest rate swap contracts, interest rate swap contracts, and gold futures contracts. The Bank and its subsidiaries have set a policy and limit to mitigate related risk, and require risk reporting for the various types of risk, as a control over financial derivative activities. The Bank and its subsidiaries manage the credit risk associated with financial derivatives on the basis of the credit limits granted to customers in general. The same credit approval process that is used when granting loans to a customer is adopted for financial derivative customers, and so the Bank and its subsidiaries are able to maintain risk at acceptable levels.

130

Annual Report 2011 Thanachart Bank Public Company Limited

211


As at 31 December 2011 and 2010, the Bank and its subsidiaries have financial derivatives for trading and hedging (banking book) as classified by their maturities as follows: (Unit: Million Baht) Consolidated financial statements 2011

2010

Less than

Over

1 year

1 year

Less than

Over

Total

1 year

1 year

Total

Foreign exchange contracts - Bought

34,381

-

34,381

24,367

-

24,367

- Sold

67,807

-

67,807

33,344

-

33,344

824

523

1,347

6,393

481

6,874

9,598

7,245

16,843

14,574

13,089

27,663

2,692

3,954

6,646

500

15,480

15,980

- Paid floating interest rate

325

2,954

3,279

-

3,359

3,359

- Received fixed interest rate

325

2,954

3,279

-

3,359

3,359

2,692

3,954

6,646

500

15,480

15,980

641

-

641

-

-

-

Cross currency and interest rate swap contracts - Bought - Sold Interest rate swap contracts - Paid fixed interest rate

- Received floating interest rate Gold future contracts - Sold

(Unit: Million Baht) Separate financial statements 2011

2010

Less than

Over

1 year

1 year

Less than

Over

Total

1 year

1 year

Total

Foreign exchange contracts - Bought

33,745

-

33,745

13,154

-

13,154

- Sold

68,444

-

68,444

12,271

-

12,271

824

523

1,347

4,476

-

4,476

9,598

7,245

16,843

9,262

4,217

13,479

2,692

3,954

6,646

-

12,302

12,302

- Paid floating interest rate

25

2,954

2,979

-

230

230

- Received fixed interest rate

25

2,954

2,979

-

230

230

2,692

3,954

6,646

-

12,302

12,302

Cross currency and interest rate swap contracts - Bought - Sold Interest rate swap contracts - Paid fixed interest rate

- Received floating interest rate

131

212

Annual Report 2011 Thanachart Bank Public Company Limited


50.

Reclassification The Bank and its subsidiaries have reclassified certain amounts in the financial statements as at 31 December 2010 and for year then ended to conform to the current year’s classifications, in accordance with the revised format stipulated by the BOT, with no effect to previously reported net income or equity. (Unit: Million Baht) 31 December 2010

Net investment

Consolidated

Separate

financial statements

financial statements

As

As previously

As

As previously

reclassified

reported

reclassified

reported

140,022

139,933

49,759

49,670

-

391

-

-

3,117

-

928

-

Financial derivatives assets

-

3,117

-

928

Prepaid corporate income tax

7

-

-

-

533

-

-

-

5,129

4,820

2,194

2,194

-

99

-

-

Derivatives liabilities

941

-

435

-

Provisions for liabilities

900

770

113

24

Financial derivatives liabilities

-

941

-

435

Accrued interest payable

-

1,852

-

1,084

Corporate income tax payable

-

2,327

-

999

Accrued expenses

-

3,271

-

1,421

Unearned premium reserve

-

1,882

-

-

Life insurance premium reserve

-

26,348

Insurance contract liabilities

29,774

-

-

-

Other liabilities

13,792

7,370

6,130

2,626

Receivables from clearing house Derivatives assets

Reinsurance assets Other assets - net Payable to clearing house

132

Annual Report 2011 Thanachart Bank Public Company Limited

213


(Unit: Million Baht) For the year ended 31 December 2010

Interest income

Consolidated

Separate

financial statements

financial statements

As

As previously

As

As previously

reclassified

reported

reclassified

reported

34,781

-

21,397

-

-

34,974

-

21,973

11,566

9,651

7,375

6,334

-

1,915

-

1,034

3,369

3,592

2,030

2,030

Fee and service expenses

519

237

45

45

Gains on trading and foreign exchange transactions

570

-

144

-

Gains on investments

314

519

148

160

-

376

3,164

-

1,723

-

-

2,680

-

1,124

-

116

-

48

Premises and equipment expenses

3,148

3,390

1,532

1,606

Other expenses

4,554

4,653

3,143

3,101

Impairment loss of loans and debt securities

2,149

-

1,280

-

Bad debts and doubtful accounts

-

2,072

-

1,157

Loss on debt restructuring

-

77

-

123

Interest and dividend income Interest expenses Contribution fee to the Deposit Protection Agency Fee and service income

Gains on foreign exchange and financial derivatives Other operating income Non-interest income

132

Gains on disposal of property foreclosed and other assets

51.

Events after the reporting period On 23 February 2012, the Board of Directors of the Bank passed a resolution to propose the payment of a dividend of Baht 0.35 per share to the ordinary shareholders in respect of the operating results for the year 2011, or a total of Baht 1,929.7 million, to the Annual General Meeting of Shareholders.

52.

Approval of financial statements These financial statements were authorised for issue by the Bank’s Board of Directors on 23 February 2012.

133

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Annual Report 2011 Thanachart Bank Public Company Limited


REMUNERATION FOR THE AUDITORS

In 2011, TBANK paid Ernst & Young Office Limited for the audit services and other services as details of the

On annual basis, the Audit Committee evaluates

auditor’s fee provided below:

the qualification and performance of the auditors and

1. Audit Fees

recommends to TBANK’s Board of Directors for an

appointment and fees of the auditors, in order to further

obtain an approval from the shareholders meeting.

1.1 Audit fees of THB 9,820,000 was paid for

The proposed candidates shall be the auditors approved

auditing the financial statements of the previous year,

by the BOT, according to the BOT’s letter No. ForKorKor.

signed by Ms. Phuphun Charoensuk, Certified Public

(02) 237/2011 dated February 28, 2011 Lists of

Accountant.

Auditors Approved for the accounting year 2011. The three

auditors as follow were in the lists:

1. Ms. Phuphun Charoensuk

systems, as required by the BOT.

Certified Public Accountant No. 4950: and/or

2. Non–Audit Fees

2. Ms. Rungnapha Lertsuwankul

Certified Public Accountant No. 3516: and/or

3. Mr. Narong

1.2 The fees of THB 780,000 for conducting

special audit and auditing electronic funds transfer

None

Pantawongs

Apart from the fees mentioned in 1 and 2 above

Certified Public Accountant No. 3315

there was no other fee for the past year that TBANK paid

of Ernst & Young Office Limited, the current auditor

to the auditors of the Bank, the audit firm the Certified

team of TBANK.

Public Accountant auditors affiliated with, persons or

businesses related to Certified Public Accountant or related

The Relationship of the Auditors and TBANK The proposed auditors have no relationship in any form with the Bank.

The Auditors of Subsidiaries and Associated Companies in Thanachart Group

to the audit firm the Certified Public Accountant auditors affiliated with.

RELATED PARTY TRANSACTIONS The details are presents in the Note to consolidated financial statements under item 43; Related party transactions.

TBANK, as a company in the group of TCAP, proposed Ernst & Young Office Limited which was an auditor of Thanachart Group, to be its auditor.

Annual Report 2011 Thanachart Bank Public Company Limited

215


CORPORATE GOVERNANCE Report on Corporate Governance Compliance

Corporate Governance Policy, Business Ethics and Codes of Conduct for Directors, Executives, and Staff TBANK’s Board of Directors has put in place written policy guidelines on corporate governance since 2003. The Board also conducts an annual review of corporate governance policies and the reporting process on business compliance with corporate governance principles of TBANK, at least once per annum. The business ethics as well as codes of conduct for directors, executives, and staff have been improved in order to establish a framework for all personnel of the Bank. TBANK has established a corporate governance policy as well as business ethics and codes of conduct for directors, executives, and staff. The policy can be easily accessed via the Bank’s website “www.thanachartbank.co.th” and Thanachart Group’s intranet system which is intended to be a channel for communicating with staff of the Group at every level, shareholders, as well as stakeholders, so that they can observe a firm standpoint and principle in good corporate governance established and practiced by the Board of Directors. In 2011, the Bank evaluated all levels of Thanachart group’s staff in order to assess and evaluate comprehension level of practicing accordingly to good corporate governance twice by the Compliance Unit. The result showed that 90% of staff was at excellent level. Moreover, Thanachart Group has continuously supported good corporate governance and recognition of corporate social responsibility awareness (CG & CSR Project) among staff in the group. This is intended to stimulate staff to acknowledge working principles of various business units in accordance with good corporate governance which begins with designing training courses that focus particularly on encouraging staff to work on the basis of morality, ethics, and business codes of conduct, for example, pure-hearted businessman program, inner power program and morality strengthening program. In 2011, there were 14,115 staffs at all levels across the country attending training courses.

TBANK’s business conducts according to good corporate governance principles in 2011 include; 1. Shareholders’ Rights and Equitable Treatment

1.1 Shareholders’ Basic Rights TBANK has a policy on shareholders’ right protection and encourages them to honor their rights. The policy includes legal basic rights, such as the bank’s profit sharing, share transactions or transfers and participation in shareholder’s meeting in order to honor their voting rights equitably and independently.

1.2 Shareholder’s Meeting In 2011, TBANK held the Annual General Meeting of Shareholders on Thursday April 7, 2011. The meeting was conducted according to related laws, regulations and corporate governance guidelines as follows:

Prior to the Shareholders’ Meeting • The Bank published the Notice of Shareholders’ meeting as well as related documents in both Thai and English, including meeting agendas and complete details of each agenda which were sufficient for shareholders’ decision making before the meeting. The aforementioned information was available via various channels as the followings;

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Annual Report 2011 Thanachart Bank Public Company Limited


Website

The information was published

(www.thanachartbank.co.th) on the website 14 days prior

The day of Annual General Meeting of Shareholders of 2011

to the meeting and was

comprised the Notice of

• TBANK arranged various facilities, such as the

Shareholders’ Meeting and

meeting venue, reception staff as well as printed ballot

related information including;

papers for each meeting agenda item, for shareholders

date, time and meeting

during the registration. In addition, shareholders could also

venue, meeting rules, vote

register in advance up to two hours prior to the meeting

casting procedures, as well

time.

as proxy statements. This

information replicated the

• TBANK established shareholder ’s meeting

documents mailed to each

guidelines to ensure that shareholders’ rights would not be

shareholder.

compromised. At any point of the meeting, shareholders

could register and enter the meeting to exercise their

Delivered by mail

The meeting notice, meeting

voting rights on any votes that has not been cast. TBANK

documents and annual report

has never adjusted or added the agendas or distributed

were

all

additional documents which contain material information

shareholders at least 14 days

during the meeting without prior notice. During the course

prior to the meeting.

of the meeting, all the shareholders were provided

delivered

to

equitable rights to express their opinions and ask

Newspaper advertisement

The meeting notice was

questions.

advertised in both Thai and

English daily newspapers for

• There were 23 shareholders in person, 43

three consecutive days, six

individual shareholders by proxy, and two juristic

days prior to the meeting day.

shareholders by proxy totaling 68 shareholders attended

• TBANK also provided an opportunity to the Bank’s

the meeting.

shareholder to raise issues for consideration as additional

• 10 of 12 Directors including the Chairman, the

items of the meeting agenda. They could nominate

Chairman of the Audit Committee and the Chairman of

candidates for director as well as any other business-

Nomination and Remuneration Committee and the Chief

related issues prior to the meeting day for one month,

Executive Officer and President attended the meeting.

from January 14, 2011 until February 14, 2011. This had

been done in Thai and English in order to accommodate

• The chairman of the meeting explicitly informed

both Thai and foreign shareholders. In addition, rules,

the shareholders on meeting rules, vote casting, and vote

procedures, and channels for raising such issues were

counting procedures.

available on the Bank’s website and the results would be informed at the shareholders’ meeting.

• In casting votes, ballot papers were required for

every agenda item. Also, during the agenda of appointing

• The proxy statements were delivered with the

directors, TBANK opened voting for each director one by

meeting notice and also published on the Bank’s website

one. The ballot papers were collected from shareholders

should shareholders need to request a proxy to attend the

for tabulating votes.

meeting on their behalf. • TBANK proposed the Chief Executive Officer and President and one independent director for shareholders to assign a proxy on their behalf. The curriculum vitae as well as information about interests of the independent director in TBANK were included in the meeting notice to provide the shareholders alternatives for appointment of proxy.

• Video presentations were used in the meeting in order to assure that all information was clearly presented.

Post Annual General Meeting of Shareholders • TBANK took minutes of the meeting whereby all important information was entirely recorded in detail. The drafted minutes of the 2011 Annual General Meeting of Shareholders was submitted to the SEC within 14 days after the meeting day.

Annual Report 2011 Thanachart Bank Public Company Limited

217


1.3 Controlling Measures on the Use of Internal Information

• In case of a conflict-of-interest, connected or related transaction between any related parties, the matter will be reported to the Compliance Department in order to

TBANK has specified the controlling measures

seek their opinion on legal issues and practice guidelines

of the use of internal information which can be

before being forwarded to the authorized party for

summarized as follows:

approval.

• An appropriate oversight on the internal data

• As stated in the notification of various

maintenance system is required for all business units

committees, any transactions from which the directors,

within the Bank.

executives or related parties gain benefit are required to

specify their interest of such transaction. In addition,

• In compliance with the SEC regulations,

related directors or executives are prohibited from

executives in manager position, the next four positions

attending the meeting during the time when such an

below manager position, and the highest ranking position

agenda item is being taken up.

in the Accounting Department are required to report their

holdings of the Bank’s shares on a quarterly basis.

• The execution of transactions from which

Moreover, any trading transactions of aforementioned

TBANK or directors or senior management of the Bank gain

shares have to be reported to the SEC within 3 business

benefit has to obtain unanimous approval from the Board

days once the transaction has been completed, and a copy

of Directors in which neither director nor senior

of the transactions have to be submitted to the Office of

management who is beneficiary can participate in the

the Chairman of Executive Committee and the CEO.

approval process.

• Directors, executives, staff, employees and

• The Board of Directors has to be fully

advisors who have access to the confidential information

informed of transactions that may involve in a conflict of

are prohibited from seeking any benefit from such

interest or related party issues and such matters are

information for their own or other’s interest. This is

always subject to careful consideration and in compliance

indicated in Thanachart Group’s ethics.

with rules and regulations of the SEC and the BOT.

• According to the Bank’s notification on

• Information disclosure on transactions which

securities trading supervision and abusive internal data

may have conflicts of interest or connected transactions or

control, Directors and executives are prohibited from

related transactions must comply with rules and

engaging in any trading of the Bank’s shares 15 days

regulations established by the authorities.

before the end of each quarter until two days after the

disclosure of the financial statements.

• All connected transactions are subject to a

review in accordance with the annual audit plan and will be

• The use of internal data for the individual

reported to the Audit Committee.

interest is considered as a policy misconduct and will be

subject to the penalties according to the judgment of the Disciplinary Committee.

1.4 Controlling Measures on Conflict of Interests

• Information about business connections or business of which the benefit is related to directors and senior management has to be disclosed quarterly for controlling purposes and included in the list of connected transactions which will be disclosed in notes to the financial statements.

TBANK has established documented policies and approval procedures on connected transactions that are fully disclosed to all related parties. The Bank has also

2. Role of Stakeholders

established controlling policies and measures aiming at

Thanachart Group has established written practice

preventing executives and related parties from making use

guidelines on stakeholders; including customers, trading

of internal information for their personal benefit. The

partners/lenders, competitors, public sector, as well as

policies are including;

society and environment, in the Business Code of Conduct

of directors, executives, and staff. All information in the guideline is disseminated through internal communication

218

Annual Report 2011 Thanachart Bank Public Company Limited


channels, so that directors, executives, and staff at all

competencies as well as necessary working skills for each

levels can strictly adhere to. The information has also been

position at every level in order to increase employees’

publicized via the Bank’s website to enhance stakeholders’

capability to respond to Thanachart Group’s visions,

confidence on their rights. The details on the treatment of

missions and objectives. The Group also strengthened

various groups of stakeholders are as follows:

employees’ recognition of relevant rules and regulations as

Shareholders

well as the Business Codes of Conduct. In order to facilitate successful integration and strengthen the

expertise of all staff members who are significant

Thanachart Group aims at having a solid

resources to support business growth and business

performance and achieving a sustainable growth as well as

continuity, the Group has established human resources

being competitive to ensure an appropriate regular return

development plans which are in alignment with its strategic

to shareholders. In conducting business, the Bank has

direction. In 2011, advised by its strategic partner,

been aware of risks and ensures that there is an efficient

Scotiabank, which has expertise in international finance,

internal control system as well as information disclosure in

the Group organized a number of effective training

an accurate, complete, timely and transparent manner.

courses, and provided external training, seminars, and

Moreover, the Bank has made arrangements to provide

staff training visits at reputable domestic and foreign

shareholders with convenience in exercising any of the

institutes.

rights to which they are entitled.

Apart from that, the Chief Executive Officer and

Employees

President have initiated the “Go Together” project, which is

a special project aimed at strengthening the unity of the

Thanachart Group recognizes equal and fair

organization under the Thanachart vision “Synergy”. In

treatments of its employees, it ensures that employees are

2011, 18 “Go Together” conferences were organized in

fairly compensated. As a guideline in determining

every region of the country. Each conference aimed at

employees’ salaries, the Group conducts surveys and takes

communicating policies and the direction of strategies from

into consideration inflation rates, the Consumer Price Index

the central Thanachart Group, in order to ensure that all

and the Key Performance Indicators (KPIs). In 2011, the

staff share the same understanding of the Group’s

Group introduced a performance evaluation form, which is

strategic direction. The Chief Executive Officer and

consistent with Thanachart Group’s key business strategies

President as well as high-level executives of TBANK paid

or the CEO’s Six-point agenda, to assess employees’

visits to all the hubs nationwide to meet with managers

performance for the purpose of fair compensation and

and staff of the network branches in order to exchange

promotion. Moreover, the Group appropriately improved

views on business operations with an emphasis on

fringe benefits for employees to relieve their burdens

adjusting competitive strategies in each region. This is to

based on the economic factors and integration preparation

ensure that the Group truly operates its business to meet

such as medical expense, annual leave, employer and

all the unique financial needs of its customers in each

employee contribution rates of provident fund, saving

region. This project not only stimulates enthusiasm of all

cooperatives for Thanachart Group’s staff, relief funds for

staff and creates a true understanding of the Group’s

unprecedented disasters such as fire and flood, fire drills,

business direction among them, which has become a

upkeep of workplace environment, as well as security for

driving force for the success of Thanachart Group, but

life and belongings. The Group also strengthens working

enhances unity and cooperation among staff across the

relationships among employees by publishing and

organization as well. The project will be continued in 2012

circulating the monthly journal entitled “San Saiyai” that

to capture the ultimate benefits of synergy and

encourages better connections between employees within

collaboration of TBANK, SCIB and the Bank of Nova Scotia.

the Group. In addition, the Group also circulates news and

information through the intranet system and internal

Customers

television Thanachart Channel” such as Thanachart Group’s

products and services, related rules and regulations, as well as activities that Thanachart Group held in 2011.

Thanachart Group is determined to develop financial products and services that could accommodate all

financial needs of customers. Fees are fairly charged and

Thanachart Group has been continually active in

the Group aims to provide customers with complete and

human resource development. In 2011, Thanachart Group

sufficient information of products and services before

focused its efforts on enhancing employees’ knowledge and

customers’ decisions are reached.

Annual Report 2011 Thanachart Bank Public Company Limited

219


Participation Mechanism of Stakeholders Thanachart Group has created a system for

prepared to consistently participate in activities that support and help communities and societies in a long-term manner with mutual understanding and sincerity.

receiving complaints and suggestions from customers,

Public Sector

external parties and stakeholders more effectively for the

purpose of organizational development. This has been

TBANK conducts its business in adherence to laws,

undertaken through various channels such as the Bank’s

rules and regulations of authorities as well as provides

website “www.thanachartbank.co.th”, marketing staff and

effective cooperation according to government policies.

Thanachart Contact Center 1770. The Bank has also

Moreover, the Bank will not become involved or do

explicitly established a business practice for the complaints

business with any illegal organizations or individuals.

reception system in which the responsible unit will follow up customers’ complaints and provide feedback to every customer or party that lodges the complaint, as well as

3. Information Disclosure and Transparency

applying customer’s needs to improve Thanachart Group’s

TBANK’s Board of Directors is responsible for the

services and increasing consumer or stakeholders’

financial statements of the Bank. In this regard, it has

satisfaction.

assigned the Audit Committee to ensure that the financial

reports and internal control system of the Bank are

Trading Partners and Lenders

accurate and valid in accordance with generally accepted

accounting principles. TBANK has also included the report

Thanachart Group has established explicit policies

of the Audit Committee in the annual report.

and practices on purchasing and outsourcing for the

purpose of fairness, transparency and verifiability of all

TBANK ensures sufficient disclosure of important

related parties as well as the rules for approval authority of

information in notes to the Bank’s financial statements.

package purchasing and rental.

The Bank also discloses the financial statements and the

notes to the financial statements on a quarterly and annual

The Bank has provided transparent and verifiable

basis on the Bank’s website. Moreover, the Investor

information to lenders and has committed to the integrity

Relations Unit is responsible for providing an accurate

of fulfilling the obligations made with the lenders under the

information and news on a timely manner to Thai and

conditions that are mutually agreed upon in addition to

foreign shareholders, investors, analysts, and credit rating

legal rules and regulations in order to build confidence for

agencies in order to strengthen the image and credibility of

long-term cooperation.

the Bank as well as provide services to shareholders

effectively. The Investor Relations Unit can be contacted

Competitors

via telephone at +66 (0) 2613 6107 and +66 (0) 2217 8199

Ext. 3027 or at E-mail address: ir.nf@thanachart.co.th.

The Bank operates under rules and competition

TBANK has established policies on information disclosure in

with other parties and organizations as well as under fairly

which the information must be accurate, complete,

established policies and practices. The Bank also does not

equitable, transparent and timely as well as in compliance

accuse, defame, or aggravate its competitors as well as

with related laws and regulations. The information is

seek for confidential information of its competitors

disclosed via the channels as follows:

dishonestly or inappropriately.

Society and Environment

1. Securities and Exchange Commission 2. Department of Business Development, Ministry of Commerce

3. TBANK’s www.thanachartbank.co.th

Thanachart Group holds a responsible attitude

• Annual registration statement form 56-1

towards society. The senior management of the Group has

• Financial statements and annual report

played an important role in promoting the principles of

• Shareholders’ meeting resolutions

social responsibility. These principles fall under the

4. Press, media and other channels

umbrella of the Group’s corporate social responsibility

5. Analyst meetings

(CSR) that places emphasis on “sustainable growth with

6. Company visits / one-on-one meetings

moral righteousness”. Supported by its staff, business

7. Road shows

alliances, local communities and society, the Group is

8. Notifications by mail

220

Annual Report 2011 Thanachart Bank Public Company Limited


In 2011, the Bank’s senior management and

(5) Neither having a relationship with the Bank in

Investor Relations provided information to related parties

the form of its professional service provider such as auditor

on various occasions, including one-on-one meetings,

and financial advisor nor having a business association

conference calls, croup analyst meetings and road shows.

with the Bank under significant cash amount or value as

4. Responsibilities of the Board of Directors

Constituent of the Board of Directors TBANK’s Board of Directors is composed of well qualified persons who have expertise, skills and experience

stipulated (at present or during the past two years before the Bank’s election). (6) Not being a representative of any member of the Bank’s Board of Directors or any major shareholder, nor being a shareholder related to the major shareholders. (7) Not being simultaneously an audit committee member of any listed company of the Group, subsidiary company, or associated company.

in financial, accounting, management and other

(8) Not having any prohibited characteristic that

professional areas which provide TBANK with great

undermines independence in carrying out his or her duties

benefits.

as director.

TBANK’s Board of Directors structure is in

Every Independent Director is free to express

compliance with the notification of the Capital Market

opinion without interest in benefit in terms of assets or

Supervisory Committee No. ThorChor 28/2008 re:

working position from the pressure of any person or any

Application for Offer and Permission for Sale of Newly

group of people as well as from any circumstances that

Issued Securities, dated December 15, 2008 and the BOT’s

could affect their opinion expression.

notification re: Governance of Financial Institutions, dated

July 9, 2009.

Executive Directors are defined as

1) Directors who are involved in the management

Independent Director

of the Bank in accordance with the Notification of the

TBANK specifies a more stringent definition and

Securities and Exchange Commission no. ThorChor 28/

qualification of the independent directors as follows:

2008 Re: Application for Offer and Permission for Sale of

(1) Holding shares not more than 0.5 percent of

Newly Issued Securities, dated December 15, 2008,

paid-up capital of the Bank, member company of the

including any additional amendments or announced

Group, subsidiary company, associated company or related

substitution which means a director who assume the

company, including shares held by persons related to the

directorship in the executive position, a director who act as

independent director.

the executive; and as a director with full signatory

(2) Not taking part in the management or being an

authority except the case when it can be demonstrated

employee, staff or advisor, who receives salary or a

that he or she is the authorized signatory according to the

controlling person of the Bank, a regular salary from the

list that the Board of Director has already approved and is

Bank, member company of the Group, subsidiary

the joint authorized signatory with other committees.

company, associated company, related company or a

person who has authority controlling a juristic person that

2) In accordance with the BOT’s Notification no.

may have a conflict of interest (at present and during the

SorNorSor 13/2009 Re: Governance of Financial

past two years).

Institutions, Executive Director is defined as:

(3) Not having a business relationship with the

(1) Director that discharges responsibility in

Bank, member company of the Group, subsidiary

the position of manager, deputy manager, assistant

company, affiliated company, or juristic person that may

manager or the equivalent.

have a conflict of interest that obstructs independence of opinion. (4) Not being a person related by blood or registration under laws such as father, mother, sibling and

(2) Director that discharges responsibility in

the operations or is involved in business management as executive, including parties in an executive committee.

(3) Director with full signatory authority,

child, including spouse of children, executives, major

except for the case when it can be demonstrated that he or

shareholders, controlling persons, or persons to be

she is the authorized signatory according to the list that

nominated as executive or controlling person of the Bank,

the Board of Director has already approved and is the joint

member company of the Group, subsidiary company,

authorized signatory with other committees.

associated company, or related company.

Annual Report 2011 Thanachart Bank Public Company Limited

221


At present, the number of Independent Directors and Non-Executive Directors of TBANK accounts for 50 percent

of the total number of Board of Directors. The constituent of the Bank’s Board of Directors as of December 31, 2011

is as follows:

Executive

Non-Executive

Independent

Director

Director

Director

Chairman

-

-

Vice Chairman

-

-

Vice Chairperson

-

-

Director

-

-

Director

-

-

Director

-

-

7. Assoc. Prof. Dr. Somjai Phagaphasvivathana Director

-

-

Director

-

-

Director

-

-

Director

-

-

Director

-

-

Director

-

-

Name Position 1. Mr. Banterng Tantivit

2. Mr. Suphadej Poonpipat 3. Mrs. Michele Chiu Kwok 4. Mr. Kiettisak Meecharoen 5. Mr. Narong Chivangkur 6. Mr. Sataporn Jinachitra 8. Ms. Suvarnapha Suvarnaprathip 9. Mr. Somjate Moosirilert 10. Mr. Brendan George John King 11. Mr. Kobsak Duangdee 12. Mr. Alberto Jaramillo

Note: TBANK’s directors who are authorized signatories include Mr. Suphadej Poonpipat, Ms. Suvarnapha Suvarnaprathip, Mr. Brendan George John King,

222

Mr. Kobsak Duangdee and Mr. Somjate Moosirilert. Any two out of the five authorized signatories can jointly sign with TBANK’s seal affixed.

Annual Report 2011 Thanachart Bank Public Company Limited


Tenure of Directorship

9. The Board ensures that both internal and external auditors conduct their duties effectively.

The tenure of directorship of the Board of Directors

10. The Board approves the quarterly and annual

has been covered clearly by TBANK’s Articles of

financial statements and ensures that the financial

Association. At each annual general shareholder’s meeting

statements are prepared in accordance with generally

of TBANK, one third (or nearest number but not exceeding

accepted accounting principles.

one third) of the members of the Board of Directors must

11. The Board ensures that information is

retire. After the date when TBANK’s Articles of Association

disseminated to Bank’s stakeholders and to the general

has become effective, the retirement of directors in year

public.

one and year two is decided by a draw. In subsequent

years, the director who holds the longest time in office will

Segregation of Duties

be retired. Should there be a case when the number of

directors holding the longest office tenure is greater than

The Chairman of the Board of Directors shall not be

the number of directors that have to be retired, a draw will

the same person as the Chief Executive Officer and

be applied. Directors who retire due to this reason can be

President so as to segregate the duties of developing

reelected to re-assume their directorship.

policies from day-to-day business management.

Roles and Responsibilities of TBANK’s Board of Directors 1. The Board is responsible for the overall business

Assumption of Directorship in Other Companies by Directors and Senior Executives

conducts of TBANK to ensure the compliance with

In compliance with the BOT’s Notification on

regulatory requirements, the Bank’s objectives and Articles

Governance of Financial Institutions, directors and senior

of Association, as well as the resolutions adopted at

executives of the Bank can assume the position of

the shareholders’ meetings.

Chairman, Executive Director or director with full signatory

2. The Board appoints the Executive Committee or sub-committees to perform duties as assigned by the

authority in no more than three business groups.

Sub-committees

Board. 3. The Board may assign or authorize one or more directors or other persons to take any action on behalf of the Board. 4. The Board makes approval on visions, missions, and values of the Bank as well as business ethics. 5. The Board considers strategies proposed by the

The Board of Directors of TBANK has appointed the sub-committees to be responsible for performing necessary duties. The roles and responsibilities of each sub-committee are as follows:

management and approves on important issues related to

Executive Committee

the Bank’s direction and policies. The Board also approve

on business plans, budgets, and operational goals proposed by the management. 6. The Board monitors the Bank’s performance and progress achieved in relation to the established objectives

TBANK’s Board of Directors has appointed the Executive Committee which consists of five members. As of December 31, 2011, the names of the member of the Executive Committee were as follows:

as well as compliance with related laws, regulations, and

1. Mr. Suphadej

policies.

7. The Board authorizes the Chief Executive Officer

Poonpipat

Chairman of the Executive Committee

2. Ms. Suvarnapha Suvarnaprathip

and President to conduct business management of TBANK

within the framework of equity expenditure budgets and

3. Mr. Brendan

operating expenditure budgets approved for various

projects. Moreover, the Bank’s Board of Directors shall

4. Mr. Somjate

approve any loan applications which are beyond the

authority on credit approval.

5. Mr. Kobsak

Vice Chairperson of the Executive Committee George John King

Vice Chairman of the Executive Committee Moosirilert

Member of the Executive Committee Duangdee

8. The Board ensures that the Bank has the

Member of the Executive Committee

effective internal control system and appropriate risk

Representative of the Office of the Chairman of

management system.

Executive Committee and the CEO

Secretary of the Executive Committee

Annual Report 2011 Thanachart Bank Public Company Limited

223


Roles and Responsibilities of the Executive Committee 1. Authorized to approve lines of credit for the

experience in accounting or finance. As of December 31, 2011, the names of the members of the Audit Committee were as follows: 1. Mr. Kiettisak

Meecharoen

benefit of TBANK as well as approve debt restructuring in

Chairman of the Audit Committee

compliance with the Financial Institution Business Act as

(Independent Director)

well as the rules and regulations of the BOT.

2. Mr. Sataporn

Jinachitra

2. Authorized to approve investments aimed at

Member of Audit Committee

generating earnings for TBANK in compliance with the

(Independent Director)

Financial Institutions Businesses Act as well as the rules

3. Assoc. Prof. Dr. Somjai Phagaphasvivathana

and regulations of the BOT.

Member of Audit Committee

3. To manage business operations in line with

(Independent Director)

TBANK’s business objectives as well as managing liquidity,

Mrs. Vijitra Thumpothong

risks and the interest rate structures.

Secretary of the Audit Committee

4. Authorized to make purchases, take transfers, and dispose of TBANK’s assets in an amount up to 5 percent of TBANK’s share capital. 5. To consider and screen matters which are

Roles and Responsibilities of the Audit Committee

beyond the authority of the Executive Committee and to

1. To review the process employed in the

present them to those having higher authority for

preparation and information disclosure of TBANK’s financial

consideration.

reports, ensuring that the information is accurate,

6. Authorized to restructure and manage the

complete, and reliable. During the reviewing process, the

organization, to establish rules and regulations related

Audit Committee will cooperate with the external auditor

to work process, to appoint and remove employees,

and the executives responsible for preparing both quarterly

to appoint advisors, as well as directing and governing

and annual financial reports.

the conduct of TBANK’s business affairs.

2. To review the efficiency and appropriateness

7. Authorized to approve salaries or other

of the internal control system, internal audits system with

compensation benefits for employees and advisors to

the adequate and efficient corporate governance. In this

support TBANK’s normal business operations.

regard, the Audit Committee will cooperate with the

8. To consider and approve appointments of independent appraisers. 9. To establish expense budgets for appraising

external auditors, internal auditors, and the respective regulators. 3. To review TBANK’s efficient risk management,

the value of the collateral as well as controlling the related

ensuring that it is adequate and in compliance with

expenses.

the Bank’s policies as well as the BOT’s guidelines

10. Authorized to delegate its authority to other staff of TBANK for the purpose of efficiency.

4. To review TBANK’s business conducts, ensuring that they are in compliance with the Bank’s policies

as well as regulatory requirements.

The Executive Committee is authorized to approve

5. To review evidences from internal investigations

lines of credit, investments and obligations in compliance

when there is an observation or inference that there might

with the requirements imposed by the BOT.

be frauds, irregularities or substantial loopholes in the

Audit Committee

Bank’s internal control system. The committee will then make a prompt report to TBANK’s Board of Directors for further consideration.

TBANK’s Board of Directors approved the

6. To review connected transactions as well as

establishment of the Audit Committee to ensure that

transactions which may lead to conflicts of interest,

TBANK’s business management is efficient and adheres to

ensuring that they are reasonable and carried out for the

the principles of good corporate governance, which would

best benefit of the Bank.

help fostering the Bank’s credibility in the eyes of general

7. To

consider

the

audit

reports

and

public and in compliance with the authorities’ policy. The

recommendations presented by the internal auditor,

Audit Committee consists of three independent directors;

the compliance officer, the external auditor, and the

all of which posses knowledge, understanding and

respective regulators, ensuring that the Bank perform necessary actions according to those recommendations.

224

Annual Report 2011 Thanachart Bank Public Company Limited


8. To ensure that the business conducts of

15. To annually review the Audit Committee

subsidiaries are in compliance with Thanachart Group’s

charter and ask for the approval from Board of Directors if

policies by giving the Internal Audit Group the following

there is any additional revision.

assignments:

16. To provide a report of Audit Committee which

8.1 To report TBANK’s Audit Committee the

includes necessary information required by the SET, signed

summary of the overall performance of the Internal Audit

off by the Chairman of the Audit Committee, in the Bank’s

Group which is responsible for auditing the Bank’s

annual report.

subsidiaries. 8.2 To report TCAP’s Board of Directors on the

17. To provide comments in the compliance report submitted to the BOT.

summary of the overall performance of the Internal Audit Group which is responsible for auditing the TBANK and

18. To report the performance of self–evaluation to the Board of Directors on an annual basis.

subsidiaries and further presented to the Board of Directors.

19. To perform any other duties assigned by the Board of Directors.

8.3 In undertaking the auditing duties specified in 8.1 and 8.2, in case that there are key issues such as violation of law, fraud, or matters that have a

Nomination and Remuneration Committee

serious impact on financial statements, status or image of

TBANK and its subsidiaries, the Internal Audit Group is required to report in detail. 9. To specify the scope of Audit Committee and any change in composition, including any significant

TBANK’s Board of Directors approved the establishment of the Nomination and Remuneration Committee. As of December 31, 2011, the members of the Nomination and Remuneration Committee were as follows:

change of the process of the audit committee in a written

1. Mr. Narong

form clearly according to the approval from the Board

of Directors. This shall be revealed to the shareholders in

the annual report of the Bank.

Committee (Independent Director) 2. Mr. Sataporn Jinachitra

10. To report to the Board of Directors in order to improve and solve problems in a timely manner in case

Chivangkur

Chairman of the Nomination and Remuneration

Member of the Nomination and Remuneration

Committee (Independent Director)

there are key issues, transactions or actions that have a

3. Mrs. Michele Chiu Kwok

serious impact on the financial statement and the Bank’s

Member of the Nomination and Remuneration

performance as follows:

Committee (Non-Executive Director)

• Conflict interest transactions

Mr. Thaneit

• Fraud or matters that have a serious impact

Secretary of the Nomination and Remuneration

to the internal audit system • Violation of law related to financial institutions or any regulatory requirements If the Board of Directors or the Executive

do not proceed with the corrections on time, the Audit Committee shall reveal such action in the Bank’s annual report and the report to the BOT. 11. To consider the independence of the internal audit department and the compliance department

Khantikaroon

Committee Roles and Responsibilities of the Nomination

and Remuneration Committee 1. To propose policy relating to nomination and remuneration of directors, sub committee’s directors, Chief Executive Officer and President, and executives to the Bank’s Board of Directors.

12. To appoint, evaluate, remove, transfer,

2. To propose criteria relating to nomination and

or dismiss the head of internal audit department and

remuneration of directors and sub committee’s directors,

the head of compliance department.

Chief Executive Officer and President, and executives to

13. To recruit and nominate candidates for the

the Bank’s Board of Directors.

external auditor of TBANK and to consider the auditing

3. To propose performance appraisal criteria of

fees, taking into account the auditor’s credibility, the

Chief Executive Officer and President and executives for

adequacy of its resources, workload of the auditor as well

annual remuneration package consideration.

as experience of the staff. 14. To hold a meeting with the Audit Committee without other management presence at least once a year.

4. To select and examine the candidates with appropriate qualifications for appointment as director, sub committee directors, or Chief Executive Officer and

Annual Report 2011 Thanachart Bank Public Company Limited

225


Roles and Responsibilities of the Risk

President and to propose qualified candidates to the Bank’s Board of Directors or Annual General Meeting of

Management Committee

Shareholders. (Depending on the situation).

5. To consider annual remunerations of director,

1. To propose policy on overall risk management of

dub committee’s directors, Chief Executive Officer and

TBANK to the Board of Directors for their approval. In this

President, and executives which are in alignment of the

regard, monitoring and auditing standards must be

criteria that have been set.

established to ensure that the risk management policy is

6. To review policy and principles of nomination

strictly adhered to.

and remuneration of directors, Chief Executive Officer and

2. To formulate risk management strategies in

President, and executives to be appropriate with job

accordance with the risk management policy and to ensure

descriptions and the market.

that the Bank’s risks are appropriately measured,

monitored, and maintained at an appropriate level.

policy, including the effectiveness of the risk management

The Board of Director of TBANK has established the

system and the adherence to the established policy.

Risk Management Committee

3. To review the adequacy of risk management

Risk Management Committee to ensure that risks are

4. To establish risk management measures which

effectively and appropriately managed and consistently

aims at preventing possible losses from occurring and at

with the Bank’s organizational structure. As of December

finding resolutions.

31, 2011, the members of the Risk Management Committee were as follows: 1. Mr. Suphadej

5. To assess both internal and external factors

that might have material impact on the Bank’s financial

Poonpipat

positions. The assessment results will be taken into account

Chairman of the Risk Management Committee

in the adjustment of TBANK’s overall risk management

2. Mr. Somjate

policy.

Moosirilert

Vice Chairman

6. To determine and instruct business units under

of the Risk Management Committee

the Risk Management Committee for the development of

3. Mr. Brendan

more efficient risk managing, controlling, and monitoring

George John King

Vice Chairman

mechanisms.

of the Risk Management Committee

7. To monitor and control the risk management

4 Mr. Piyaphong Artmangkorn

conduct of committees and/or business units to ensure

Member of the Risk Management Committee

that they adhere to the established policy.

5. Mr. Ajay

Pratap Mundkur

8. To report the committee’s performance to the

Member of the Risk Management Committee

Audit

6. Mr. Anuwat

improvement, ensuring that the improvements are in line

Luengtaweekul

Member of the Risk Management Committee 7. Mr. Enghug

Nontikarn

Committee

regularly

on

areas

that

need

with the established risk management policy and strategies.

Member of the Risk Management Committee

Corporate Governance Committee

8. Mrs. Angelina Dick

Member of the Risk Management Committee 9. Mr. Ricky

Jon Yakabowich

TBANK has realized the importance of having a good corporate governance system in accordance with the

Member of the Risk Management Committee

good corporate governance principles for listed companies

10. Mrs. Kjitphan

and the SET’s guidelines on the disclosure of information

Chunharit

Member of the Risk Management Committee

on corporate governance practices in the annual report.

11. Mr. Sakda

The Bank’s Board of Directors, therefore, plays the role of

Chantrasuriyarat

Member of the Risk Management Committee

the Corporate Governance Committee by determining

12. Mr. Kamtorn

policy on corporate governance in compliance with the

Tantisiriwat

Member and Secretary

SET, the SEC, and the BOT’s guidelines. The committee has

of the Risk Management Committee

assigned duties for two sub-committees as follows:

1. The Executive Committee undertakes the oversight and control of the Bank’s business conducts to ensure compliance with the policy guidelines on corporate governance, approved by Board of Directors.

226

Annual Report 2011 Thanachart Bank Public Company Limited


2. The Audit Committee is responsible for

13. Mr. Lalit    Dodampe Gamage Dharmaseri

monitoring, reviewing, and examining the policy

Member of the Asset

compliance to ensure that the Bank has a good corporate

and Liability Management Committee

governance system.

Representative of the Risk Control Dept.

Asset and Liability Management Committee The Executive Committee has established the Asset and Liability Management Committee to manage the

Secretary of the Asset and Liability Management Committee Roles and Responsibilities of the Asset and Liability Management Committee

Bank’s assets and liabilities effectively and to be consistent

1. To formulate the Bank’s liquidity, interest rate,

with the organization structure. As of December 31, 2011,

and exchange rate risk management plans under the policy

the committee was consisted of:

established by the Executive Committee.

1. Mr. Suphadej

Poonpipat

2. To manage TBANK’s liquidity and exchange rate

Chairman of the Asset

risks in accordance with the trends of the money market

and Liability Management Committee

and capital market conditions.

2. Mr. Somjate

Moosirilert

3. To manage the Bank’s interest rate structure

Vice Chairman of the Asset

and determine the rate of interest both floating and fixed

and Liability Management Committee

interest rates in order to prevent any adverse impacts from

3. Ms. Suvarnapha Suvarnaprathip

interest rate volatility.

Member of the Asset and Liability Management Committee 4. Mr. Brendan

George John King

4. To approve investments in bonds and private debt instruments within budget limits. 5. To authorize a person or a group of persons

Member of the Asset

under the authority of the Asset and Liability Management

and Liability Management Committee

Committee.

5. Mr. Enghug

Nontikarn

6. To report on the performance of liquidity, interest

Member of the Asset

rate and exchange rate management to the Executive

and Liability Management Committee

Committee.

6. Mrs. Noossara Roonsamrarn

Member of the Asset

Investment Portfolio Committee

and Liability Management Committee

7. Mr. Piyaphong Artmangkorn

The Executive Committee has established the

Member of the Asset

Investment Portfolio Committee in order to ensure that the

and Liability Management Committee

investment portfolio of the Bank is efficient and consistent

8. Mr. Nophadon Ruengchinda Member of the Asset and Liability Management Committee 9. Mr. Anuwat

to the organizational structure. The committee, as of December 31, 2011, comprised the followings: 1. Mr. Suphadej

Luengtaweekul

Member of the Asset

2. Mr. Somjate

and Liability Management Committee 10. Mr. Ajay

Pratap Mundkur

11. Mr. Kobsak

3. Ms. Suvarnapha Suvarnaprathip Member of the Investment Portfolio Committee 4. Mr. Brendan

Duangdee

Member of the Asset

5. Mr. Piyaphong

Artmangkorn

Member of the Investment Portfolio Committee

Amyongka

Representative of the Risk Control Dept.

Member of the Asset and Liability Management Committee

George John King

Member of the Investment Portfolio Committee

and Liability Management Committee 12. Mr. Pisuthi

Moosirilert

Vice Chairman of the Investment Portfolio Committee

Member of the Asset and Liability Management Committee

Poonpipat

Chairman of the Investment Portfolio Committee

Secretary of the Investment Portfolio Committee

Annual Report 2011 Thanachart Bank Public Company Limited

227


Roles and Responsibilities of the Investment Portfolio Committee

Roles and Responsibilities of the Credit Committee

1. To determine investment policies as well as to

1. To establish a work plan and oversight credit

consider and approve investment plans. 2. To approve investments within the scope of

approval procedures under the policy approved by TBANK’s Executive Committee or Board of Directors.

authority specified by TBANK, which must be complied

2. To establish covenants and conditions of credit

within established position limits and VaR limits and to

lines and approve new credit lines as well as adjust

examine investment proposals that exceed its approval

conditions on credit lines within the delegated authority,

authority before proposing them to the Executive

taking into account the credit risk assessments within the

Committee which has higher approval authority.

scope specified by TBANK’s Executive Committee or Board

3. To review the investment performance and determine guidelines aimed at improving investment performance

of Directors. 3. To establish the authority on credit approval to a person or a group of persons within delegated authority

4. To manage the market risk arising from changes in prices of investment portfolios.

of the Credit Committee. 4. To approve transactions which exceed the scope

5. To establish and review the ratio of provisioning

of authorization of the Debt Restructuring Committee or

or determine the impairment value of the securities

other subsequently appointed committees of which scope

invested.

of responsibilities are similar to the aforementioned

committee.

scope of authorization of the Credit Committee in order to

Credit Committee

5. To screen credit applications which exceed the

The Executive Committee has established the Credit

propose them to TBANK’s Executive Committee or Board of

Committee to enhance the efficiency of TBANK’s credit

Directors for approval. In case of urgency, the Credit

underwriting process, integration process, and compliance

Committee may propose credit applications to the

with the organizational structure of the Bank. As of

aforementioned committee without screening.

December 31, 2011, the members of the Credit Committee included: 1. Mr. Suphadej

Poonpipat

Chairman of the Credit Committee 2. Mr. Somjate

Moosirilert

Member of the Credit Committee 3. Ms. Suvarnapha Suvarnaprathip Vice Chairperson of the Credit Committee 4. Mr. Brendan

George John King

Member of the Credit Committee 5. Mrs. Noossara Roonsamrarn Member of the Credit Committee 6. Mr. Taweesak

Saksirilap

Member of the Credit Committee 7. Mrs. Angelina Dick Member of the Credit Committee 8. Mr. Noel

Singh

Member of the Credit Committee 9. Mrs. Sasima

Taweeskulchai

Member of the Credit Committee 10. Mr. Wuttichai

Suraratchai

Member of the Credit Committee 11. Mr. Pisuthi

Amyongka

Member of the Credit Committee Representative of the Risk Control Dept. Secretary of the Credit Committee

228

6. To report credit approval results to TBANK’s Executive Committee or Board of Directors.

Annual Report 2011 Thanachart Bank Public Company Limited

The Executive Committee has also established

a number of sub-committees to ensure that TBANK’s business conducts have been managed in a proper, efficient, and effective manner.

Executives As of December 31, 2011, there were executives

in the manager’s position and the first four executives subsequent to the manager, according to the SEC guidelines as follows: 1. Mr. Somjate Moosirilert1 Chief Executive Officer and President 2. Mr. Brendan George John King Deputy Chief Executive Officer 3. Mrs. Noossara Roonsamrarn Executive Vice President 4. Mr. Piyaphong Artmangkorn Executive Vice President 5. Mr. Nophadon Ruengchinda Executive Vice President 6. Mr. Anuwat

Luengtaweekul

Executive Vice President


7. Mr. Ajay

Pratap Mundkur

Executive Vice President 8. Mr. Enghug

Nontikarn2

Executive Vice President 9. Mr. Rathian

Notes:

Srimongkol3

Roles and Responsibilities of the Company Secretary 1. To provide the Board of Directors with preliminary advice on laws, rules and regulations as well as

Executive Vice President

the Articles of Association of Thanachart Bank and ensure

10. Mrs. Phenchan Weerawuth4

that they have been complied properly and regularly.

1 Mr.

First Vice President

Moreover, the secretary is entitled to report to the Board of

Directors on any material changes.

Somjate Moosirilertposition’s name has changed to Chief Executive Officer and President since January 6, 2011. 2 Mr. Enghug Nontikarn has been appointed to be Executive Vice President since June 1, 2011. 3 Mr. Rathian Srimongkol was appointed to be Executive Vice President on June 1, 2011 and resigned since January 1, 2012. 4 Mrs. Phenchan Weerawuth has been appointed to be First Vice President since October 1, 2011.

Chief Executive Officer and President

2. To organize annual shareholders general meetings and the Board of Directors meetings in compliance with legal requirements as well as the Articles of Association of TBANK. 3. To take minutes of annual shareholders general meetings and the Board of Directors meetings, as well as to monitor the implementation of the resolutions adopted

at the shareholders’ meeting and the meetings of the

With reference to the BOT Notification No.

Board of Directors.

TorPorTor. ForKorKor.(21) Lor. 248/2010 dated October 22,

4. To document and keep records of director’s

2010 approving the appointment of Mr. Somjate Moosirilert

reiterative documents, invitations to the Board of Directors

as Chief Executive Officer and President, TBANK’s Board of

meeting, the minutes of the Board of directors meeting,

Directors has determined the duties and authority of the

TBANK’s annual report, invitations to the shareholders’

Chief Executive Officer and President as follows:

meeting and the minutes of the shareholders’ meeting.

1. To formulate directions and strategies which aim at achieving TBANK’s goals, visions, and missions. 2. To formulate business plans and budget for TBANK’s Executive Committee’ and Board of Directors’ approval. 3. To manage and approve business transactions, as well as to oversight business conducts of TBANK’s executives and staff, ensuring that they are in alignment with the business plans and budget approved by the Bank’s Executive Committee and Board of Directors. 4. To manage and approve matters related to TBANK’s organizational structure and human resource management. 5. To report TBANK’s performance to the Executive Committee or the Board of Directors.

5. To ensure the disclosure of information and reports within respective authority to the supervisory agency in accordance with authority’s rules and regulations 6. To contact and communicate with shareholders in general, ensuring that they are well informed about their rights and about news of TBANK. 7. To support activities of TBANK’s Board of Directors.

Board of Directors Meetings TBANK’s Board of Directors convenes its meeting

regularly in the last week of each month. It may also hold additional meetings as deemed appropriate. The meeting agenda will be clearly determined in advance including the

regular agenda such as business performance monitoring,

As regards the level of approval authorization, the

approval of business transactions, and risk management.

Chief Executive Officer and President is authorized to

The Secretary of the Board of Directors is responsible for

approve a credit line, investment or obligation worth no

sending meeting invitations to all members of the Board

more than THB 300 million, provided that they are

along with the agenda as well as supporting documents in

supported by collateral in the form of bonds, deposits or

advance so that the Board has sufficient time to review

debt instruments.

them before attending the meetings. In 2011, the Board of

Company Secretary In accordance with the principles of good corporate

Directors convened 14 general meetings. At the Board of Directors meeting, every director

is encouraged to express their opinions and to adopt

governance, TBANK has assigned the Office of the

resolutions independently. The Chairman of the Board

Chairman of the Executive Committee and the CEO to be

of Directors shall provide opportunities to all directors

a unit that performs the secretariat functions to ensure the

to express their opinions before requesting the adoption

Bank’s effective business management.

of resolutions. The notices and opinions of the directors

Annual Report 2011 Thanachart Bank Public Company Limited

229


at meetings are documented. The minutes of the meetings are approved by the Board of Directors and are available to be examined by the Board and related parties.

Table of Directors’ Attendance at Meeting held in 2011 (Unit: times)

List of TBANK’s Directors

1. Mr. Banterng

Board of Audit Directors Committee (13 Meetings) (13 Meetings)

Nomination and Remuneration Committee (13 Meetings)

Risk Management Committee (9 Meetings)

Executive Committee (28 Meetings)

Tantivit

13/13

-

-

-

-

Poonpipat

13/13

-

-

8/9

28/28

Chiu Kwok

0/13

-

0/13

-

-

Meecharoen

13/13

13/13

-

-

-

Chivangkur

13/13

-

13/13

-

-

Jinachitra

13/13

13/13

13/13

-

-

13/13

13/13

-

-

-

13/13

-

-

-

25/28

George John King

13/13

-

-

5/9

25/28

Moosirilert

13/13

-

-

8/9

28/28

Duangdee

12/13

-

-

-

24/28

Weeks

4/7

-

-

-

-

Jaramillo

3/4

-

-

-

-

2. Mr. Suphadej 3. Mrs. Michele 4. Mr. Kiettisak 5. Mr. Narong 6. Mr. Sataporn 7. Assoc. Prof. Dr. Somjai Phagaphasvivathana 8. Ms. Suvarnapha Suvarnaprathip 9. Mr. Brendan 10. Mr. Somjate 11. Mr. Kobsak 12. Mr. Martin 13. Mr. Alberto

Notes: 1. Mrs. Michele Chiu Kwok had health problems. However, she has been electronically monitoring the Bank’s business conducts and giving

recommendations of benefits to the Bank on a regular basis. 2. Mr. Martin Weeks resigned from his directorship on June 30, 2011. 3. Mr. Alberto Jaramillo has assumed his directorship since September 27, 2011.

Nomination and Appointment of Directors 1. Appointment Procedures of TBAK’s Board of Directors. TBANK does not specify the maximum number of directors. However, in accordance with the Bank’s Articles

of Association, the Bank must have at least five directors. The appointment procedure can be categorized into two cases, including the case of appointing a new director to replace the one who is retired by rotation; and the case is when

the appointment is made during the directorship tenure due to a vacancy. In this regard, TBANK’s Board of Directors has established the Nomination Committee in order to select and nominat qualified candidates for directorships. Under the first circumstance, a resolution of the shareholders’ meeting is required, while, in the latter case, the Board of Directors is able to approve the director’s appointment, given that qualifications are fulfilled. In addition, the appointment of

the independent director has to be conducted in compliance with the regulations imposed by the BOT.

230

Annual Report 2011 Thanachart Bank Public Company Limited


In electing the Bank’s Director at the

1. Mr. Narong

Chivangkur

shareholders’ meeting, every shareholder has equal voting

Independent

rights. The rules and procedures of Director’s election

Nomination and Remuneration Committee

at the shareholders’ meeting are as follows:

Certificate: Role of the Nomination and

(1) Each voter has one vote which equals to

of

the

Governance Committee, Class 1/2011

one share per one vote.

Certificate: Financial Institutions Governance

(2) Vote casting can be conducted individually or in terms of a group of individuals or by any other

Director/Chairman

Program, Class 2/2011 2. Mr. Kobsak

Duangdee

procedure as deemed appropriate by the shareholders.

Director/Executive Committee

However, in each resolution, all shareholders must cast

Certificate: Financial Institutions Governance

their votes according to (1). (3) Resolutions are adopted by a majority vote. In case votes are equal, the ultimate decision belongs to the Chairman of the meeting. 2. Appointment Procedures of the Executive Committee. TBANK’s Board of Directors may appoint

Program, Class 2/2011

Evaluation of the Board of Directors and Senior Management’s Performance TBANK conducts the evaluation of the directors’ performance annually. The evaluation can be categorized

a number of directors to hold a position of the Executive

into: 1) The evaluation of Board of Directors’ performance

Committee as it deems appropriate. Among these, one of

and 2) The evaluation of Chief Executive Officer and

them shall serve as the Chairman of the Executive

President’s performance.

Committee. The Executive Committee will be authorized to

manage and conduct TBANK’s business affairs as assigned

Succession Plan

by TBANK’s Board of Directors. The Chief Executive Officer

and President will be ex-officio members of the Executive

The Nomination and Remuneration Committee is

Committee. 3. Appointment Procedures of the Audit Committee. The Board of Directors will appoint at least three Independent Directors who have met the Bank’s qualifications to assume the directorship in the Audit Committee. The Committee is responsible for undertaking

responsible for ensuring that there is a succession plan for the Chief Executive Officer and President position in order to sustain continuity of the Bank’s management.

The Orientation for Newly Appointed Directors and Executives

responsibilities as specified in the charter of the Audit

Committee which must be complied with the SEC’s

When there is a newly appointed director or

guideline. The Committee is fully independent to perform

executive, the Office of the Chairman of Executive

their duties and has a direct reporting line to the Board of

Committee and the CEO is responsible for preparing

Directors.

necessary documents for the new director or executive, as

4. Appointment Procedures of the Nomination and Remuneration Committee.

the case may be. Such documents comprised the Bank’s annual report, which contains visions, strategies, and goals

The Board of Directors will appoint at least

of the Bank; the director and executive’s manual, which

three Independent Directors to assume the directorship in

includes what prohibited by laws related to financial

the Nomination and Remuneration committee. The

institutions; and the relevant Acts and notifications.

Committee is responsible for undertaking responsibilities

as specified in the charter of the Nomination and

Remuneration Policy

Remuneration Committee in accordance with the SEC’s

guidelines and the BOT’s regulations.

The remuneration of TBANK’s directors has been

Development of Directors and Executives

determined by comparison with the director’s remuneration across the industry. Such comparison has been applied along with consideration of roles, duties, and scope of

responsibilities of each director. The remuneration of

Each Director of TBANK has attended at least one

TBANK’s director has to be under the review and screening

training course organized by the Thai Institute of Directors

of the Nomination and Remuneration Committee which

(IOD). Two Directors that have attended the training

then recommends to the Bank’s Board of Directors for their

course in 2011 are:

consideration before being proposed to the shareholders’

Annual Report 2011 Thanachart Bank Public Company Limited

231


meeting. The remuneration will be paid in terms of meeting stipends, monthly compensation, and performance allowances. Members of sub-committee will receive the remuneration as specified by TBANK’s Board of the Directors based on the recommendation of the Nomination and Remuneration Committee. The recommendation is derived by considering their duties and responsibilities compared to industry peers. The sub-committee’s remuneration will be in terms of meeting stipends and/or position allowance. The remuneration of executives complies with policies and standards which are associated with the Bank as well as individual performance. The performance assessment is conducted via the use of Key Performance Indicators (KPI).

The executives will be remunerated in terms of salaries and allowances of which the average meets the industry’s peers.

Director’s Remuneration

a) Financial Remuneration Director’s and Committee’s Remuneration As of December 31, 2011, TBANK has remunerated three committees, including the Board of Directors, the Audit Committee, and the Nomination and Remuneration Committee totaling THB 26,928,252.69. The remuneration has been paid in terms of meeting stipends, position allowance and performance-based allowance (from the Bank’s performance in 2010) which can be summarized as follow:

Table of the remuneration of the Board of Directors Type of remuneration (Baht per year) List of Directors 1. Mr. Banterng Tantivit 2. Mr. Suphadej Poonpipat 3. Mrs. Michele Chiu Kwok 4. Mr. Kiettisak Meecharoen 5. Mr. Narong Chivangkur 6. Mr. Sataporn Jinachitra 7. Assoc. Prof. Dr. Somjai Phagaphasvivathana 8. Ms. Suvarnapha Suvarnaprathip 9. Mr. Brendan George John King 10. Mr. Somjate Moosirilert 11. Mr. Kobsak Duangdee 12. Mr. Martin Weeks 13. Mr. Alberto Jaramillo Total

Monthly compensation

Meeting stipends

Performance allowance

Total

693,000.00

556,400.00

2,714,419.67

3,963,819.67

346,500.00

278,200.00

1,357,209.82

1,981,909.82

346,500.00

0.00

1,357,209.82

1,703,709.82

346,500.00

278,200.00

1,357,209.82

1,981,909.82

346,500.00

278,200.00

1,357,209.82

1,981,909.82

346,500.00

278,200.00

1,357,209.82

1,981,909.82

346,500.00

278,200.00

1,357,209.82

1,981,909.82

346,500.00

278,200.00

1,357,209.82

1,981,909.82

346,500.00

278,200.00

1,357,209.82

1,981,909.82

346,500.00

278,200.00

1,357,209.82

1,981,909.82

346,500.00

256,800.00

1,357,209.82

1,960,509.82

173,250.00

85,600.00

1,357,209.82

1,616,059.82

90,475.00

64,200.00

0.00

154,675.00

4,421,725.00

3,188,600.00

17,643,727.69

25,254,052.69

Notes: 1. Mr. Martin Weeks resigned from his directorship on June 30, 2011. 2. Mr. Alberto Jaramillo has assumed his directorship since September 27, 2011.

232

Annual Report 2011 Thanachart Bank Public Company Limited


Table of the remuneration of the Audit Committee Type of remuneration (Baht per year) List of Directors

1. Mr. Kiettisak

Monthly compensation

Meeting stipends

Total

Meecharoen

219,600.00

357,500.00

577,100.00

Jinachitra

109,800.00

178,750.00

288,550.00

109,800.00

178,750.00

288,550.00

439,200.00

715,000.00

1,154,200.00

2. Mr. Sataporn 3. Assoc. Prof. Dr. Somjai

Phagaphasvivathana

Total

Table of the remuneration of the Nomination and Remuneration Committee Type of remuneration (Baht per year) List of Directors Meeting stipends 1. Mr. Narong

Chivangkur

325,000.00

Jinachitra

195,000.00

2. Mr. Sataporn 3. Mrs. Michele

Chiu Kwok

0.00

Total

520,000.00

The Remuneration of the Executive Committee TBANK’s Board of Directors has not yet determined the remuneration of the Executive Committee; therefore, no payment to its members was made. The Remuneration of Executives Based on the guidance of the SEC and Section 4 and Section 25 of Financial Institution Business Act B.E. 2551, there were 37 persons in total who were considered executives in the position of manager and the first four executive below the manager. The total payments made to them in 2011 in the form of salaries, allowances, cost-of-living allowances and contribution payments to the provident fund amounted to THB 201,253,695.00. The Remuneration of the Independent Director of the Subsidiaries With regard to the remuneration of the independent director of the subsidiaries, there is one independent director who assumed the directorship in TLIFE and received the compensation amounted to THB 200,000.00 in 2011. b) Remuneration Other Than Cash Payments As of December 31, 2011, there was no remuneration other than cash payments.

Annual Report 2011 Thanachart Bank Public Company Limited

233


Report of the Nomination and Remuneration Committee On March 26, 2002, TBANK’s Board of Directors approved the establishment of the Nomination Committee

and the Remuneration Committee. On March 25, 2009, the Bank Board of Directors’ meeting adopted a resolution to combine the Nomination Committee and the Remuneration Committee together and name the Committee to “the Nomination and Remuneration Committee”. The Committees consisted of two independent directors and one non-executive director whose names as of December 31, 2011 were as follows; 1. Mr. Narong

Chivangkur

Chairman (Independent Director)

2. Mrs. Michele Chiu Kwok Member

(Non-Executive Director)

3. Mr. Sataporn Jinachitra Member

(Independent Director)

Mr. Thaneit

Khantikaroon

Secretary

In 2011, the Nomination and Remuneration Committee convened thirteen meetings to process the following matters;

1. To select and nominate appropriate persons to be appointed as a director replacing the director resigning to the

2. To review and nominate appropriate persons to be appointed as directors replacing the directors retiring by

Bank’s Board of Directors. rotation for the year 2011 to the Bank’s Board of Directors’ meeting and the Annual General Meeting of the Shareholders.

3. To select and nominate the appropriate persons to be appointed as Executives to the Board of Directors.

4. To provide opportunities for shareholders to propose appropriate persons to be appointed as Bank’s directors in

5. To review and consider the remuneration packages for directors and sub-committees, taking into consideration

the 2012 Annual General Meeting of Shareholders of Thanachart Bank Public Company Limited. that such remuneration package commensurate with the assigned duties and responsibilities, the Board of Directors’ and sub-committee performances, and the Bank’s overall performance 2011 remuneration packages were proposed for approval at the Bank’s Board of Directors meeting and the Annual General Meeting of Shareholders for the year 2011.

6. To consider the performance evaluation, adjustment of annual salary and bonus of Chairman of the Executive Committee, Chief Executive Officer and President, and Executives.

7. To consider the remuneration of the Chairman of the Executive Committee and Chief Executive Officer and

8. To recommend the Thanachart Group’s Executives Succession Plan.

9. To recommend related issues of the salary structure and salary survey results of financial institutions.

President.

(Mr. Narong Chivangkur) Chairman of the Nomination and Remuneration Committee

234

Annual Report 2011 Thanachart Bank Public Company Limited


supervision and Management Structures

Board of Directors

Risk Management Committee Compliance Unit

Executive Committee

Asset and Liability Management Committee

Integration and Change

Investment Portfolio Committee

Credit Committee

Office of Executive Committee Chairman and CEO

IT Security Management Committee

Chief Executive Officer and President

Investment Management

As of December 31, 2011

Annual Report 2011 Thanachart Bank Public Company Limited

235


Board of Directors and Management Team

Mr. Banterng  Tantivit Chairman (Non-Executive Director) Age

67 years

Education(s)

• Master of Science (Finance) in Management,

Massachusetts Institute of Technology, USA

• Bachelor of Science in Electrical Engineering,

Massachusetts Institute of Technology, USA

Directorship and executive

Thai Institute of Directors Association

training program(s)

• Director Accreditation Program (DAP), Class 25/2004

Experience(s) in the past 5 years 2006 – Present

• Vice Chairman, Thanachart Insurance Company Limited

• Director, Siam Piwat Holding Company Limited

2005 – Present

• Chairman, Thanachart Life Assurance Company Limited

2003 – Present

• Chairman, MBK Resort Public Company Limited

• Director, Siam Piwat Company Limited

• Director, B.V. Holding Company Limited

• Chairman, Plan Estate Company Limited

2001 – Present

• Advisor, Dusit Thani Public Company Limited

• Advisor, Patum Rice Mill and Granary Public Company Limited

1994 – Present

• Chairman, Thanachart Capital Public Company Limited

1989 – Present

• Chairman and Chairman of the Executive Committee,

MBK Public Company Limited

1987 – Present

• Director, Deebuk Company Limited

• Director, Thai Farming Company Limited

2010 – 2011

• Chairman, Siam City Bank Public Company Limited

2006 – 2010

• Director, Arsom Silp Institution of the Arts Council

Family relationship with

None

management No. of TBANK share(s) held

236

None

Annual Report 2011 Thanachart Bank Public Company Limited


Mr. Suphadej  Poonpipat Vice Chairman and Chairman of the Executive Committee (Executive Director) Age

61 years

Education(s)

• Master of Science, University of Wisconsin, USA

• Bachelor of Business Administration and Accounting, Chulalongkorn University

Directorship and executive

Thai Institute of Directors Association

training program(s)

• Director Accreditation Program (DAP), Class 8/2004

Capital Market Academy, The Stock Exchange of Thailand

• Leadership Program, Class 8/2009

Experience(s) in the past 5 years 2011 – Present

• Vice Chairman and Chairman of the Executive Committee,

Patum Rice Mill and Granary Public Company Limited 2007 – Present

• Director, Royal Orchid Hotel (Thailand) Public Company Limited

• Director, Thai Royal Orchid Real Estate Company Limited

2006 – Present

• Director, Siam Piwat Holding Company Limited

2005 – Present

• Director and Chairman of the Executive Committee,

Thanachart Insurance Company Limited

• Director, MBK Resort Public Company Limited

2003 – Present

• Director and Chairman of the Executive Committee,

Thanachart Life Assurance Company Limited

• Director, Plan Estate Company Limited

• Director, Siam Piwat Company Limited

• Vice Chairman, Member of the Compensation and Nomination Committee and

Vice Chairman of the Executive Committee, MBK Public Company Limited

1990 – Present

• Vice Chairman, Chairman of the Executive Committee and

President and Chief Executive Officer, Thanachart Capital Public Company Limited

(Holding Vice Chairman position in the Board of Directors and Chairman position

in the Executive Committee in 2007) 2010 – 2011

• Vice Chairman, Siam City Bank Public Company Limited

2000 – 2011

• Advisor, Patum Rice Mill and Granary Public Company Limited

1992 – 2010

• Director, Advanced Info Service Public Company Limited

Family relationship with

None

management No. of TBANK share(s) held

None

Annual Report 2011 Thanachart Bank Public Company Limited

237


Mrs. Michele  Chiu Kwok Vice Chairperson and Member of the Nomination and Remuneration Committee (Non-Executive Director) Age

52 years

Education(s)

• Master of Business Administration (Finance & Marketing),

University of British Columbia, Canada

• Bachelor of Science in Mathematics, University of British Columbia, Canada

Directorship and executive

None

training program(s) Experience(s) in the past 5 years 2008 – Present

• Director, Canada China Business Council, Canada

2006 – Present

• Governor, The Canada Chamber of Commerce, Hong Kong

• Senior Vice President/Regional Head, Asia/Pacific and Middle East,

The Bank of Nova Scotia, Hong Kong

• Director, Scotiabank (Hong Kong) Limited, Hong Kong

• Director, Boracay Limited, Hong Kong

• Director, The Bank of Nova Scotia Asia Limited, Singapore

• Director, The Bank of Nova Scotia Berhad, Malaysia

• Director, Scotiatrust (Asia) Limited, Hong Kong

2010 – 2011

• Vice Chairman and Member of the Nomination and Remuneration Committee,

Siam City Bank Public Company Limited Family relationship with

None

management No. of TBANK share(s) held

238

None

Annual Report 2011 Thanachart Bank Public Company Limited


Mr. Kiettisak  Meecharoen Chairman of the Audit Committee (Independent Director) Age

65 years

Education(s)

• Master of Theoretical Economics, Keio University, Japan

• Bachelor of Science in Finance, Hitotsubashi University, Japan

Directorship and executive

Thai Institute of Directors Association

training program(s)

• Director Accreditation Program (DAP), Class 40/2005

• Audit Committee Program (ACP), Class 10/2005

Harvard University

• Banking and Monetary Policy in Developing Countries Program

Experience(s) in the past 5 years 2005 – Present

• Independent Director, Tararom Enterprise Public Company Limited

2000 – Present

• Independent Director, Thanachart Life Assurance Company Limited

• Independent Director and Chairman of the Audit Committee,

Safety Insurance Public Company Limited

2010 – 2011

• Independent Director and Chairman of the Audit Committee,

Siam City Bank Public Company Limited Family relationship with

None

management No. of TBANK share(s) held

None

Annual Report 2011 Thanachart Bank Public Company Limited

239


Mr. Narong  Chivangkur Chairman of the Nomination and Remuneration Committee (Independent Director) Age

67 years

Education(s)

• Management Development Program, Asian Institute of Management, Philippines

• Financial Management Program, Rochester Institute of Technology, USA

Directorship and executive

Thai Institute of Directors Association

training program(s)

• Role of the Nominations and Governance Committee (RNG), Class 1/2011

• Financial Institutions Governance Program (FGP), Class 2/2011

• Audit Committee Program (ACP), Class 32/2010

• Financial Statement for Directors (FSD), Class 4/2009

• Successful Formulation & Execution the Strategy (SFE), Class 2/2008

• Role of the Compensation Committee (RCC), Class 4/2007

• Corporate Social Responsibility (CSR), Class 1/2007

• Director Certification Program (DCP), Class 34/2003

Experience(s) in the past 5 years 2005 – Present

• Director, Momchailai Development Company Limited

2003 – Present

• Director, Momentum IM Company Limited

2000 – Present

• Director, Momentum BBS Company Limited

2010 – 2011

• Director and Chairman of the Nomination and Remuneration Committee,

Siam City Bank Public Company Limited 2004 – 2011

• Director, Momentum Sale and Distribution Company Limited

Family relationship with

None

management No. of TBANK share(s) held

None

240 Annual Report 2011 Thanachart Bank Public Company Limited


Ms. Suvarnapha Suvarnaprathip Vice Chairperson of the Executive Committee (Executive Director) Age

66 years

Education(s)

• Bachelor of Economics, Monash University, Australia

• Certificate, Executive Commercial Lending Training Program, Banker Trust,

New York, USA

Directorship and executive

Thai Institute of Directors Association

training program(s)

• Director Accreditation Program (DAP), Class 20/2004

Experience(s) in the past 5 years 2005 – Present

• Director and Chairperson of the Executive Committee,

Thanachart Capital Public Company Limited

• Director and Member of the Executive Committee,

Thanachart Life Assurance Company Limited

1991 – Present

• Director, Seacon Development Public Company Limited

2010 – 2011

• Director and Vice Chairperson of the Executive Committee,

Siam City Bank Public Company Limited Family relationship with

None

management No. of TBANK share(s) held

None

Annual Report 2011 Thanachart Bank Public Company Limited 241


Mr. Sataporn  Jinachitra Member of the Audit Committee and Member of the Nomination and Remuneration Committee (Independent Director) Age

63 years

Education(s)

• Master of Science (Econometrics),

The London School of Economics and Political Science (University of London),

England

• Bachelor of Science (Economics), University College London

(University of London), England

• Bachelor of Arts (Law), Sukhothai Thammathirat Open University

Directorship and executive

Thai Institute of Directors Association

training program(s)

• Role of the Chairman Program (RCP), Class 24/2010

• Role of the Compensation Committee (RCC), Class 10/2010

• Corporate Social Responsibility (CSR), Class 1/2007

• DCP Refresher Course, Class 2/2006

• Director Certification Program (DCP), Class 0/2000

Experience(s) in the past 5 years 2010 – 2011

• Independent Director, Member of the Audit Committee and

Member of the Nomination and Remuneration Committee,

Siam City Bank Public Company Limited 2006 – 2011

• Dispute Resolution Committee, Interconnection Institution, NTC

1999 – 2011

• Director, Thai Institute of Directors Association

2002 – 2006

• President, Export-Import Bank of Thailand

Family relationship with

None

management No. of TBANK share(s) held

None

242 Annual Report 2011 Thanachart Bank Public Company Limited


Mr. Brendan  George John King Vice Chairman of the Executive Committee and Deputy Chief Executive Officer (Executive Director) Age

48 years

Education(s)

• Master of Business Administration (Finance & International Business),

York University, Canada

• Bachelor of Arts (Business & Economics), York University, Canada

Directorship and executive

• Marketing Certificate, Queen’s University Executive Management Program

training program(s)

• Honors Diploma in General Management, the Institute of Canadian Bankers

• The Fundamentals of Coaching Excellence

• Moody’s Risk Analysis

• Commercial Sales Leadership Program, Scotiabank

• International Commercial Banker Development Program, Scotiabank

• Merchant Banking Introductory Course

• Introduction to Investment Banking and Bond Structuring

• Leader-Coach Program, Scotiabank

• Strategic Selling Skills Course, Scotiabank

Experience(s) in the past 5 years 2011 – Present

• Director, Scotia Netherlands Holding B.V.

2004 – Present

• Director, Scotiabank (Hong Kong) Limited, Hong Kong

• Director, Scotia Nominees (Hong Kong) Limited, Hong Kong

2010 – 2011

• Director and Vice Chairman of the Executive Committee,

Siam City Bank Public Company Limited 2002 – 2004

• General Manager, International Corporate Finance,

Scotiabank (Bahamas) Limited, USA

Family relationship with

None

management No. of TBANK share(s) held

None

Annual Report 2011 Thanachart Bank Public Company Limited 243


Assoc. Prof. Dr. Somjai  Phagaphasvivathana Member of the Audit Committee (Independent Director) Age

66 years

Education(s)

• Doctorado de Estado, Facultad de Ciencia Politica,

Universidad Complutense de Madrid, Spain

• Diplome d’Etudes Superieures (Economic Integration),

Universite de Nancy, France

• Licenciatura, Facultad de Ciencia Politicay Economica,

Universidad Complutense de Madrid, Spain

• Beachelor of Arts, Chulalongkorn University

Directorship and executive

Thai Institute of Directors Association

training program(s)

• Director Accreditation Program (DAP), Class 34/2005

Experience(s) in the past 5 years 2006 – Present

• Independent Director and Chairman of the Audit Committee,

SEAFCO Public Company Limited 1997 – Present

• Independent Director and Chairman of the Audit Committee,

Lee Feed Mill Public Company Limited

• Director, Krungthep Thanakom Company Limited

• Director, Thai Hua Rubber Public Company Limited

1996 – Present

• Independent Director and Member of the Audit Committee,

Amarin Printing and Publishing Public Company Limited 2010 – 2011

• Independent Director and Member of the Audit Committee,

Siam City Bank Public Company Limited Family relationship with

None

management No. of TBANK share(s) held

None

244 Annual Report 2011 Thanachart Bank Public Company Limited


Mr. Kobsak  Duangdee Member of the Executive Committee and Executive Vice President (Executive Director) Age

55 years

Education(s)

• Master of Business Administration (Finance), University of Tennessee,

Knoxville, USA

• Bachelor of Commerce and Accountancy, Chulalongkorn University

Directorship and executive

Thai Institute of Directors Association

training program(s)

• Financial Institutions Governance Program (FGP), Class 2/2011

• Director Accreditation Program (DAP), Class 73/2008

Experience(s) in the past 5 years 2011 – Present

• Liquidator, SCIB Public Company Limited

2008 – Present

• Director and Member of the Executive Committee,

Thanachart Securities Public Company Limited

• Vice President and Country Head,

The Bank of Nova Scotia, Bangkok Representative Office

2010 – 2011

• Director and Member of the Executive Committee,

Siam City Bank Public Company Limited

• Director, Siam City Securities Company Limited

2006 – 2010

• Director, Thai-Canadian Chamber of Commerce

1997 – 2008

• Vice President and Country Head, The Bank of Nova Scotia, Bangkok Branch

2003 – 2005

• President, Thai-Canadian Chamber of Commerce

Family relationship with

None

management No. of TBANK share(s) held

None

Annual Report 2011 Thanachart Bank Public Company Limited 245


Mr. Somjate  Moosirilert Member of the Executive Committee and Chief Executive Committee and President (Executive Director) Age

54 years

Education(s)

• Master of Management,

Sasin Graduate Institute of Business Administration of Chulalongkorn University

• Bachelor of Business Admininstration, Thammasat University

Directorship and executive

Thai Institute of Directors Association

training program(s)

• Role of the Chairman Program (RCP), Class 5/2001

Capital Market Academy, The Stock Exchange of Thailand

• Leadership Program, Class 5/2007

Judicial Training Institute

• Certificate in the program for Senior Executives on Justice Administration,

Class 9/2005

Experience(s) in the past 5 years 2011 – Present

• Governor, The Stock Exchange of Thailand

• Executive Director, The Thai Bankers’ Association

• Vice Chairman, Thai Listed Companies Association

• Chairman, TS Asset Management Company Limited

2010 – Present

• Chairman and Chairman of the Executive Committee,

Siam City Life Assurance Company Limited

• Director and Chairman of the Executive Committee,

Thanachart Fund Management Company Limited

• Director and Member of the Executive Committee,

Thanachart Insurance Company Limited

• Advisor, Association of Securities Companies

2009 – Present

• Chairman, Thanachart Securities Public Company Limited

• Director, Member of the Executive Committee

and Senior Executive Vice President, Thanachart Capital Public Company Limited

2010 – 2011

• Chairman, Siam City Asset Management Company Limited

• Chairman, Thanachart Fund Management Company Limited

• Chairman, Siam City Securities Company Limited

• Director, Chairman of the Executive Committee and Chief Executive Officer

and President, Siam City Bank Public Company Limited

2010

• Director, Thanachart Life Assurance Company Limited

2009 – 2011

• Vice Chairman, The Stock Exchange of Thailand

• Director, Thai Capital Market Development Committee

2009 – 2010

• President and Chief Executive Officer, Thanachart Capital Public Company Limited

• Senior Executive Vice President, Thanachart Bank Public Company Limited

• Director, TSFC Securities Public Company Limited

• Executive Director, Association of Securities Companies

2009

• Chairman of the Executive Committee, Thanachart Securities Public Company Limited

2002 – 2008

• President, Thai Asset Management Corporation

Family relationship with

None

management No. of TBANK share(s) held

None

246 Annual Report 2011 Thanachart Bank Public Company Limited


Mr. Alberto  Jaramillo Director (Non-Executive Director) Age

40 years

Education(s)

• Master of Business Administration,

Université de Montréal École des Hautes Études Commerciales, Canada

• Administrador de Empresas,

Instituto Colombiano de Estudios Superiores de Incolda, Colombia

Directorship and executive

None

training program(s) Experience(s) in the past 5 years 2011 – Present

• Vice President & Regional Treasurer, The Bank of Nova Scotia, Hong Kong

2005 – 2011

• Treasurer, The Bank of Nova Scotia Inverlat, Mexico

2001 – 2005

• Risk Manager Latin America, The Bank of Nova Scotia, Canada

1998 – 1999

• Trading Group Director, Corfinsura Colombia

1996 – 1998

• Trader, Corfivalle Colombia

Family relationship with

None

management No. of TBANK share(s) held

None

Mrs. Noossara  Roonsamrarn Executive Vice President Age

53 years

Education(s)

• Master of Business Administration, National Institute of Development Administration

• Bachelor of Political Science, Chulalongkorn University

Directorship and executive

Harvard Business School

training program(s)

• Certificate in Advanced Management Program (AMP 168)

Thailand National Defence College

• The Joint-State-Private Sectors Course (NDC 22)

Capital Market Academy, The Stock Exchange of Thailand

• Leadership Program, Class 7 (CMA 7)

Thai Institute of Directors Association

• DCP Refresher Course, Class 4/2007

• Director Certification Program (DCP), Class 19/2002

Experience(s) in the past 5 years 1997 – Present

• Director and Member of the Audit Committee,

Thanachart Insurance Company Limited 2005 – 2008

• Director and Member of the Audit Committee,

Thanachart Fund Management Company Limited Family relationship with

None

management No. of TBANK share(s) held

None

Annual Report 2011 Thanachart Bank Public Company Limited 247


Mr. Piyaphong  Artmangkorn Executive Vice President Age

54 years

Education(s)

• Master of Public Administration (Taxation), University of Southern California, USA

• Bachelor of Economics, Thammasat University

Directorship and executive

Thai Institute of Directors Association

training program(s)

• Director Accreditation Program (DAP), Class 8/2004

Experience(s) in the past 5 years 1998 – Present

• Director, MBK Public Company Limited

2006 – Present

• Executive Committee, MBK Public Company Limited

2010

• Director, Siam City Bank Public Company Limited

2005 – 2009

• Chairman and Chairman of the Executive Committee,

Thanachart Securities Public Company Limited 2001 – 2008

• Director, Thai Royal Orchid Real Estate Company Limited

2000 – 2008

• Director, Royal Orchid Hotel (Thailand) Public Company Limited

2005 – 2007

• Director and Member of the Executive Committee,

Thanachart Capital Public Company Limited 1998 – 2005

• Executive Vice President, National Finance Public Company Limited

Family relationship with

None

management No. of TBANK share(s) held None

248 Annual Report 2011 Thanachart Bank Public Company Limited


Mr. Nophadon  Ruengchinda Executive Vice President Age

54 years

Education(s)

• Master of Management,

Sasin Graduate Institute of Business Administration of Chulalongkorn University

• Master of Business Administration,

National Institute of Development Administration

• Bachelor of Political Science, Chulalongkorn University

Directorship and executive

Thai Institute of Directors Association

training program(s)

• Director Certification Program (DCP), Class 45/2004

• Finance for Non-Finance Directors (FND), Class 11/2004

Experience(s) in the past 5 years 2009 – Present

• Director, Thanachart Training and Development Company Limited

2005 – Present

• Director, Thanachart Life Assurance Company Limited

1998 – Present

• Director, Thanachart Insurance Company Limited

2010

• Director, Siam City Bank Public Company Limited

2009 – 2010

• Director, T Leasing Company Limited

2004 – 2009

• Director and Chairman of the Audit Committee,

Thanachart Fund Management Company Limited 2000 – 2009

• Director, Thai International Rent a Car Company Limited

Family relationship with

None

management No. of TBANK share(s) held

None

Annual Report 2011 Thanachart Bank Public Company Limited 249


Mr. Anuwat  Luengtaweekul Executive Vice President Age

48 years

Education(s)

• Master of Business Administration, Rangsit University

• Bachelor of Science (Accounting), Kasetsart University

Directorship and executive

Thai Institute of Directors Association

training program(s)

• Successful Formulation & Execution the Strategy (SFE), Class 3/2009

• Board and Performance Evaluation Program

• Director Certification Program (DCP), Class 24/2002

Association of Finance Companies

• Financers’ Executive Development Program, Class 9/1994

Experience(s) in the past 5 years 2010 – Present

• Director, Ratchthani Leasing Public Company Limited

2010

• Director, Siam City Bank Public Company Limited

2007 – 2009

• Director, Member of the Executive Committee and Executive Vice President,

Thanachart Capital Public Company Limited Family relationship with

None

management No. of TBANK share(s) held

None

Mr. Ajay  Pratap Mundkur Executive Vice President Age

47 years

Education(s)

• Master of Business Administration, John M. Onlin School of Business,

Washington University, St. Louis, USA

• Post Graduate Diploma in Financial Management,

Symbiosis Institute of Business Management, Pune, India

• Bachelor of Commerce (Accounting and Auditing), University of Pune, India

Directorship and executive

None

training program(s) Experience(s) in the past 5 years 2005 – 2009

• Vice President, Retail Banking, Asia-Pacific Region, The Bank of Nova Scotia

Family relationship with

None

management No. of TBANK share(s) held

None

250 Annual Report 2011 Thanachart Bank Public Company Limited


Mr. Enghug Nontikarn Executive Vice President Age

55 years

Education(s)

• Master of Business Administration, Thammasat University

• Bachelor of Economics, Thammasat University

Directorship and executive

Thai Institute of Directors Association

training program(s)

• Director Accreditation Program (DAP), Class 25/2004

Experience(s) in the past 5 years 1995 – Present

• Independent Director, Member of the Audit Committee and

Member of the Nomination Committee,

Srithai Superware Public Company Limited

2006 – 2011

• Senior Executive Vice President, Siam City Bank Public Company Limited

Family relationship with

None

management No. of TBANK share(s) held

None

Annual Report 2011 Thanachart Bank Public Company Limited 251


Mr. Rathian Srimongkol Executive Vice President

Age 52 years Education(s) • Master of Business Administration, Thammasat University • Master of Public Administration (General Management), Suan Sunandha Rajabhat University • Bachelor of Medicine (M.D.), Mahidol University • Bachelor of Science (Medical Science), Mahidol University • Diploma, National Defence College, the Joint-State-Private Sectors Course, Class 21 Directorship and executive King Prajadhipok’s Institute training program(s) • Advanced Certificate Course in Politics and Governance in Democratic System for

Executives, Class 9 Capital Market Academy, The Stock Exchange of Thailand • Leadership Program, Class 11 Experience(s) in the past 5 years 2009 – Present • Vice Chairman and Chairman of the Audit Committee, Indorama Ventures Public Company Limited 2010 – 2011 • Director and Chairman of the Audit Committee, Indorama Polyimers Public Company Limited 2008 – 2011 • Executive Vice President, Siam City Bank Public Company Limited 2008 – 2010 • Director, TOT Public Company Limited 2008 • Chairman, Industrial Estate Authority of Thailand 2004 – 2008 • First Executive Vice President, Siam City Bank Public Company Limited • Chairman, The Zoological Park Organization Family relationship with None management No. of TBANK share(s) held None Note: Mr. Rathian Srimongkol resigned from Executive Vice President in TBANK on 1 January 2012

Mrs. Phenchan  Weerawuth First Vice President, Accounting Age Education(s) Directorship and executive training program(s) Experience(s) in the past 5 years 2005 – 2011 Family relationship with management No. of TBANK share(s) held

59 years • Master of Accounting, Thammasat University • Bachelor of Accounting, Thammasat University None

• First Vice President, Accounting, Siam City Bank Public Company Limited None

None

252 Annual Report 2011 Thanachart Bank Public Company Limited


The information of the Executives and Authorized persons’ position in subsidiary, associated and related companies

Name List

TBANK

As at 31 December 2011 Parent Company

Associated Company

Subsidiary Companies

1

2

3

XXX

XXX

XX ///

XX /// A

4

5

11

Related Companies

6

7

8

9 10

12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46

XXX ///

X

XXX

X

X

XXX

X

X

X /// X ///

XX //

X

X

X

X

Mr. Banterng

Tantivit

Mr. Suphadej

Poonpipat

Mrs. Michele

Chiu Kwok

Mr. Kiettisak

Meecharoen

X

Mr. Narong

Chivangkur

X

Ms. Suvarnapha Suvarnaprathip Mr. Sataporn

Jinachitra

Mr. Brendan

George John King

Assoc. Prof. Dr. Somjai Phagaphasvivathana

X //

X //

X

X

X G

X

X

X

X

X

X

X /

X

X

X

X

X

X

X

X // B

X

X

X

X

Annual Report 2011 Thanachart Bank Public Company Limited 253

Duangdee

X / D

Mr. Somjate

Moosirilert

X / A

X / C

Mr. Alberto

Jaramillo

X /

XXX X /// X /

XXX/// XXX

X

Mrs. Noossara Roonsamrarn D D

Mr. Nophadon Ruengchinda D Mr. Anuwat

XX /// X

XX

Mr. Kobsak

Mr. Piyaphong Artmangkorn

XX XXX

X

X

X

X

X

G

X

X F

X

X

X

Luengtaweekul D

X /

X

X

Mr. Ajay Pratap Mundkur D Mr. Enghug Nontikarn D

X

Mr. Rathian Srimongkol D

X

Mrs. Phenchan Weerawuth E Note:

XXX = Chairman

A = President and Chief Executive Officer

B = Deputy Chief Executive Officer

F = Vice President

G = Authorized Person Management Power

XX = Vice Chairman

X = Director

/// = Chairman of the Executive Committee

// = Vice Chairman of the Executive Committee

C = Senior Executive Vice President

/ = Member of the Executive Committee

D = Executive Vice President

E = First Vice President


List of Parent Company Subsidiary, Associated and Related Companies

Parent Company 1. Thanachart Capital Public Company Limited

Subsidiary Companies 2. Thanachart Securities Public Company Limited

7. TS Assets Management Company Limited

3. Thanachart Fund Management Company Limited

8. Rachthani Leasing Public Company Limited

4. Thanachart Insurance Company Limited 5. Thanachart Life Assurance Company Limited

9. Thanachart Management and Service Company Limited 10. Thanachart Training and Development Company Limited

6. Siam City Life Assurance Company Limited

Associated Companies 11. MBK Public Company Limited

Related Companies 12. Siam Piwat Holding Company Limited

31. Safety Insurance Public Company Limited

13. MBK Resort Public Company Limited

32. Mom Chailai Development Company Limited

14. Siam Piwat Company Limited

33. Momentum IM Company Limited

15. B.V. Holding Company Limited

34. Momentum BBS Company Limited

16. Plan Estate Company Limited

35. Seacon Development Public Company Limited

17. Deebuk Company Limited

36. Scotia Netherlands Holding B.V.

18. Thai Farming Company Limited

37. Scotia Nominees (Hong Kong) Limited, Hong Kong

19. Patum Rice Mill and Granary Public Company Limited

38. SEAFCO Public Company Limited

20. Royal Orchid Hotel (Thailand) Public Company Limited

39. Lee Feed Mill Public Company Limited

21. Thai Royal Orchid Real Estate Company Limited

40. Krungthep Thanakom Company Limited

22. Canada China Business Council, Canada

41. Thai Hua Rubber Public Company Limited

23. The Canadian Chamber of Commerce, Hong Kong

42. Amarin Printing & Publishing Public Company Limited

24. The Bank of Nova Scotia, Hong Kong

43. SCIB Public Company Limited

25. Scotiabank (Hong Kong) Limited, Hong Kong

44. The Bank of Nova Scotia, Bangkok Representative Office

26. Boracay Limited, Hong Kong

45. The Stock Exchange of Thailand

27. The Bank of Nova Scotia Asia Limited, Singapore

46. Srithai Superware Public Company Limited

28. The Bank of Nova Scotia Berhad, Malaysia

47. Indorama Ventures Public Company Limited

29. Scotiatrust (Asia) Limited, Hong Kong 30. Tararom Enterprise Public Company Limited

254 Annual Report 2011 Thanachart Bank Public Company Limited


General Information

Investment of TBANK in Other Companies Details of TBANK and its Subsidiary Companies, Associated Companies, and Other Companies in which it hold 10 percent of shares and over Type of Type of Total numberv of Total number of No. Company/Locations Business shares paid-up shares shares held

1

Thanachart Securities Plc.

Securities

444 MBK Tower,14th, 18th, and 19th Floor,

Ordinary 1,500,000,000 1,499,999,930

Percent of TBANK’s shareholding1

100.00

Share

Phayathai Road, Wangmai, Pathumwan, Bangkok 10330 Tel. +66 (0) 2217-8888,

+66 (0) 2217-9595

Fax +66 (0) 2217-9642 2

Thanachart Insurance Co., Ltd.

Non-Life

999/1 The Nine Tower 2nd-3rd, 5th Floor,

Insurance

Ordinary

74,000,000

73,999,434

100.00

50,000,000

49,999,400

100.00

1,000,000

999,993

100.00

600,000

599,993

100.00

Share

999/2, 4th Floor, 999/3 4th Floor, Rama 9 Road, Suanluang, Bangkok 10250 Tel. +66 (0) 2308-9300 Fax +66 (0) 2308-9333 3

Thanachart Life Assurance Co., Ltd. 999/1 The Ninth Tower 1st, 4th-5th Floor,

Life

Ordinary

Assurance

Share

Legal

Ordinary

Advisory

Share

999/4, 4th Floor, Rama 9 Road, Suanluang, Bangkok 10250 Tel. +66 (0) 2308-9400 Fax +66 (0) 2308-9444 4

Thanachart Legal and Appraisal Co., Ltd.3 128/20-21 Phayathai Plaza Office,

3rd

Floor,

Phayathai Road, Thung Phaya Thai, Ratchathewi, Bangkok 10400

Services and Appraisal

Tel. +66 (0) 2216-6677 Fax +66 (0) 2216-9022 5

Thanachart Management and Services

Services

Co., Ltd.

Ordinary Share

128/23 Phayathai Plaza Office, 3rd Floor, Phayathai Road, Thung Phaya Thai, Ratchathewi, Bangkok 10400 Tel. +66 (0) 2612-1500 Fax +66 (0) 2612-1400

Annual Report 2011 Thanachart Bank Public Company Limited

255


Type of Type of Total numberv of Total number of No. Company/Locations Business shares paid-up shares shares held

6

Thanachart Training and Development

Percent of TBANK’s shareholding1

Training

Ordinary

500,000

499,993

100.00

Leasing

Ordinary

36,000,000

35,999,994

100.00

600,000

599,994

100.00

70,000,000

69,999,994

100.00

100,000

99,998

100.00

200,000,000

199,999,997

100.00

10,000,000

9,999,000

99.99

Co., Ltd. 207/6 Thanachart Building, 5th Floor, Ratchadaphisek Road, Dindaeng, Bangkok 10400 Tel. +66 (0) 2290-3410 Fax +66 (0) 2290-3419 7

Thanachart Group Leasing Co., Ltd. 444 MBK Tower,

11th

Floor, Phayathai Road,

Share

Wangmai, Pathumwan, Bangkok 10330 Tel. +66 (0) 2217-8000,

+66 (0) 2217-8333

Fax +66 (0) 2611-9488 8

National Leasing Co., Ltd.2

Leasing

444 MBK Tower, 12th Floor,

Ordinary Share

Phayathai Road, Wangmai, Phayathai, Pathumwan, Bangkok 10330 Tel. +66 (0) 2217-8000 9

Siam City Life Assurance Co., Ltd. 231 Thanachart Park Place, 9th-11th Floor,

Life

Ordinary

Assurance

Share

Services

Ordinary

Rachadamri Road, Lumpini, Pathumwan, Bangkok 10330 Tel. +66 (0) 2207-4200 Fax +66 (0) 2253-8484 10

SCIB Services Co., Ltd.

1091/230 New Petchburi Road,

Share

Makkasan, Ratchathewi, Bangkok 10400 Tel. +66 (0) 2208-5061-2 Fax +66 (0) 2651-6611 11

TS Asset Management Co., Ltd.

Non-

Ordinary

1101 Petchburi Building, 9th Floor

performing

Share

New Petchburi Road, Makkasan,

asset

Ratchathewi, Bangkok 10400

management

Tel. +66 (0) 2208-5555 Fax +66 (0) 2208-5892 12

Thanachart Broker Co., Ltd.

Insurance

Ordinary

1 Glas Haus Building, 4th Floor,

Broker

Share

Soi Sukhumvit 25, Klongtoey Nuea, Watthana, Bangkok 10110 Tel. +66 (0) 2685-0200,

+66 (0) 2685-0300

Fax +66 (0) 0685-0322, 2685-0333

256

Annual Report 2011 Thanachart Bank Public Company Limited


Type of Type of Total numberv of Total number of No. Company/Locations Business shares paid-up shares shares held

13 SCIB Public Co., Ltd.3 1091/230 New Petchburi Road, Makkasan, Ratchathewi,

Sale of

Ordinary

company

Share

Percent of TBANK’s shareholding1

2,112,810,676 2,112,375,422

99.98

assets

Bangkok 10400 Tel. +66 (0) 2208-5061-2 Fax +66 (0) 2651-6611 14 Thanachart Fund Management Co., Ltd. 898 Ploenchit Tower, 15th and 18th Floor, Ploenchit Road, Lumpini, Pathumwan,

Mutual

Ordinary

Fund

Shar

10,000,000

7,499,993

75.00

1,342,349,708

874,973,000

65.18

240,000

80,000

33.33

50,000,000

12,500,000

25.00

7,000,000

1,633,800

23.34

29,999,971

4,500,000

15.00

Management

Bangkok 10330 Tel. +66 (0) 2126-8300 Fax +66 (0) 2126-8398 15 Rachthani Leasing Public Co., Ltd.

Leasing

77/35-36 Sinn Sathorn Tower, 11upth Floor,

Ordinary Share

Krung Thonburi Road, Klong Ton Sai, Klong San, Bangkok 10600 Tel. +66 (0) 2440-0844 Fax +66 (0) 2440-0848 16 Thoon Ruam Kan Co., Ltd.3

Others

133/2 Soi Sukumvit 21, Sukumvit Road,

Ordinary Share

Klongtoey, Bangkok 10110 Tel. +66 (0) 2259-0284 Fax +66 (0) 2258-7043 17 Siam Samsung Life Insurance Co., Ltd.

Insurance

2922/222-227, 15th Floor,

Ordinary Share

2922/262, 21st Floor, Charn Issara Tower II, New Petchburi Road, Bangkapi, Huay Klang, Bangkok 10320 Tel. +66 (0) 2308-2261-8 Fax +66 (0) 2308-2269 18 Siam Media and Communication Co., Ltd.3 18 Building 2 West SCB Park Plaza,

Commu-

Ordinary

nication

Share

Leasing

Ordinary

17th-22nd Floor, Ratchadapisek Road, Ladyao, Chatuchak, Bangkok 10900 Tel. +66 (0) 2544-2451 Fax +66 (0) 2544-3317 19 Siam City Leasing and Factoring Plc.

1091/179-181 New Petchburi Road,

Share

Makkasan, Ratchathewi, Bangkok 10400 Tel. +66 (0) 2254-8744

Annual Report 2011 Thanachart Bank Public Company Limited

257


Type of Type of Total numberv of Total number of No. Company/Locations Business shares paid-up shares shares held

20 High Pressure Steal Pipe Industry Co.,

Ltd.3

Industrial

Ordinary

pipe

Share

36/4 Moo 2 Soi Wat Mahawong,

Percent of TBANK’s shareholding1

500,001

70,470

14.09

100,000

9,998

10.00

750,000

75,000

10.00

5,000,000

500,000

10.00

74,000,000

7,400,000

10.00

45,000,000

4,500,000

10.00

20,000

2,000

10.00

13,000

1,300

10.00

Manufacturing

Phuchaosmingprai Road, Samrong, Prapha Daeng, Samut Prakarn 10130 Tel. +66 (0) 2393-4485 21 Puen Pob Paet Co., Ltd.

Medical

Ordinary

Clinic

Share

Construction

Ordinary

444 MBK Tower, 9th Floor, Phayathai Road, Wangmai, Pathumwan, Bangkok 10330 Tel. +66 (0) 2217-9836-7 22 Crystal City Development Co., Ltd.3

419 Sathupradit Road, Chong Nonsi,

Share

Yannawa Bangkok 10120 Tel. +66 (0) 2255-6470 Fax +66 (0) 2255-6495 23 Metropolitan Industrial Leasing Co., Ltd.3

Leasing

81/42 Moo 5, Surasak, Sriracha,

Ordinary Share

Chonburi 20110 Tel. +66 (0) 3804-8052 24 Steel Top Co., Ltd.

Manufacturing Ordinary

551/144 Sathupradit Road, Chong Nonsi,

Share

Yannawa, Bangkok 10120 Tel. +66 (0) 2719-9643 25 Sahakol Chassis Co., Ltd.

Vehicle

1418/6-8 Phaholyotin Road, Lard Yao,

Ordinary Share

Chatuchak, Bangkok 10900 Tel. +66 (0) 2512-0336-41 Fax +66 (0) 2513-2424 26 Siam Tire Cord Co., Ltd. 46/1 Moo 9, Bang Na-Trat Road, K. M. 39,

Textiles

Ordinary

and apparel

Share

Construction

Ordinary

Bangprakong, Chachoengsao, 24180 Tel. +66 (0) 3853-8400-6 Fax +66 (0) 3853-8399 27 Soonvijai Development Co., Ltd.3

1740 New Petchburi Road, Bangkapi, Huai Khwang, Bangkok 10310

258

Annual Report 2011 Thanachart Bank Public Company Limited

Share


Type of Type of Total numberv of Total number of No. Company/Locations Business shares paid-up shares shares held

28 Modular Samko Co., Ltd.3

Household

Ordinary

155 Moo 14, Suhkumvit Sai Kao Road,

Percent of TBANK’s shareholding1

3,500,000

350,000

10.00

13,000,000

1,300,000

10.00

1,000,000

100,000

10.00

Share

Bangpakong, Chachoengsao 24130 Tel. +66 (0) 3853-2050-3 Fax +66 (0) 3853-0053 29 Siam Euro Leasing Co., Ltd.3 20/22 Soi Prommitr, Suhkumvit Road, Klong Tan Nuea, Watthana,

Finance

Ordinary

and

Share

Securities

Bangkok 10110 30 Siam City Real Estate Services Co., Ltd.3

Construction

Ordinary

62 Thaniya Building, 1st Floor,

Share

Silom Road, Suriyawong, Bangrak, Bangkok 10500

Notes:

1 Shareholding

2 TBANK

3 Held

percentage shown included the shareholding of by related companies.

indirectly held shares through TGL which was in line with the definition of subsidiaries company announced by the SET.

by TBANK, which is in the process of liquidation, dissolution, bankruptcy, receivership or abandoned.

TBANK’S REFERENCES

Location of Head office:

900 Tonson Tower, Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330, Thailand

Registration No.:

0107536001401

Registered Capital:

THB 59,346,192,720, consist of common shares of 5,934,619,272 shares with

a value of THB 10 per share.

(As of December 31, 2011)

Paid-up Capital:

THB 55,136,649,030, consist of common shares of 5,513,664,903 shares with

a value of THB 10 per share.

(As of December 31, 2011)

Website:

www.thanachartbank.co.th

Telephone:

+66 (0) 2655-9000

Fax

+66 (0) 2655-9001

Thanachart Contact Center:

1770

Annual Report 2011 Thanachart Bank Public Company Limited

259


Name, Location, Telephone and Fax of Other References

Ordinary shares

Securities Representative/Registrar

Thailand Securities Depository Company Limited

62 The Stock Exchange of Thailand Building,

Ratchadaphisek Road, Khlongtoei, Bangkok 10110, Thailand

Tel. +66 (0) 2229-2800

Call Center +66 (0) 2229-2888

www.tsd.co.th

Debentures

TBANK155A, TBANK194A, TBANK197A and TBANK247A Debenture Representative/Registrar

Thai Military Bank Public Company Limited

393 Silom Road, Silom, Bangrak, Bangkok 10500, Thailand

Tel. +66 (0) 2230-6061 Fax +66 (0) 2230-6093

Website: www.tmbbank.com

TBANK204A Debenture Representative/Registrar

CIMB Thai Public Company Limited

44 Lungsuna Building, 15th Floor, Lungsuan Road,

Lumpini, Pathumwan, Bangkok 10330, Thailand

Tel. +66 (0) 2626-7503 Fax +66 (0) 2633-9026

Website: www.cimbthai.com

TBANK196A Debenture Representative/Registrar

Thanachart Bank Public Company Limited

Securities and Trustee Services

1 Glas Haus Building, Ground Floor, Sukhumvit 25 Road,

Klongtoey Nuea, Watthana, Bangkok 10110, Thailand

Tel. +66 (0) 2207-4900 ext 1300, 1317 Fax +66 (0) 2207-4930-1

Website: www.thanachartbank.com

Hybrid Tier I Debenture Representative/Registrar

Thanachart Bank Public Company Limited

Securities Operation Section

444 MBK Tower, 20th Floor, Payathai Road,

Wangmai Pathumwan Bangkok 10330, Thailand

Tel. +66 (0) 2217-8000 ext 3833 Fax +66 (0) 2611-4839

Website: www.thanachartbank.co.th

Auditor

Miss Phuphun Charoensuk, Certified Public Accountant (Thailand) No. 4950

Ernst & Young Office Limited

193/136-137 Lake Rajada Office Complex, 33rd Floor, Rachadaphisek Road,

Klongtoey, Bangkok 10110, Thailand

Tel. +66 (0) 2264-0777 Fax +66 (0) 2264-0789-90

Financial Advisor

None

Advisor or Manager under

None

Management Contract

260

Annual Report 2011 Thanachart Bank Public Company Limited


STRUCTURE OF MAJOR SHAREHOLDERS

List of top ten major shareholders

Rank

List Of Shareholders

No. Of Shares

Percentage of Shareholding

1.

Thanachart Capital Public Company Limited

2,809,726,575

50.960

2.

Scotia Netherlands Holdings B.V.

2,701,627,557

48.999

3.

Mr. Thung-ngern Pum-ngern

418,462

0.008

4.

Ms. Kittima

Tolieng

157,525

0.003

5.

Mr. Sathit

Majurintangkurg

110,327

0.002

6.

Ms. Piengjai

Hanphanit

96,665

0.002

7.

Mr. Wanchai

Chirathivat

84,809

0.002

8.

Mr. Thanawat

Chareonthassanont

70,000

0.001

9.

Mr. Pinit

Laosoontorn

63,569

0.001

10.

Mr. Somyos

Jittipralungsri

60,000

0.001

By receivership of Legal Execution Department of 1,249,414

0.023

Total Paid-up Capital

5,513,664,903

100.000

Thai Shareholders

2,811,994,046

51.000

Foreign Shareholders

2,701,670,857

49.000

Thai Finance and Securities Plc.

11.

Other Shareholders

Source:

Report of the Bank’s Major shareholders as of December 30, 2011 prepared by Thailand Securities Depository Co., Ltd.

Group of major shareholders who have significant influence over the formulation of management policies There are two major shareholders who have significant influence over management policies, which are TCAP and the Scotia Netherlands Holdings B.V., which holds 50.960 percent and 48.999 percent of the total paid-up shares respectively. TCAP does not have any major shareholder which has significant influence over its management policies or its operation.

Annual Report 2011 Thanachart Bank Public Company Limited

261


Dividend Payment Policy

Dividend Payment Policy of Thanachart Bank

TBANK has a policy to pay dividend out of its net profit after deduction of all reserve funds according to requiremrnt of the relevant laws. Payment of dividends is subject to investment plans and other necessaries as seen appropriate by the Board of Directors. The Board, however, may approve to pay an interim dividend and will report to the Shareholders at the next Shareholders Meeting. At the Annual General Meeting of Shareholders for the year 2011 held on 7 April 2011, the shareholders passed

a resolution approving the dividend payment for the year 2010 performance to the Bank shareholders at a rate of THB 0.40 per share. The dividend payment was made, on 26 April 2011, to 5,513,664,903 shares in the total amount of THB 2,205,465,961.20.

Dividend Payment Policy of the Subsidiary Companies TBANK has not fixed a dividend payout ratio for its subsidiaries. Their dividend payments shall depend on

the operating results of each company.

The subsidiary companies, similar to TBANK, have a policy to paying dividend out of their net profit after deduction

of all reserve funds according to requirments of the relevant laws. Payment of dividends is subject to investment plans and other necessaries as seen appropriate by the Board of Directors. The Board, however, may approve to pay an interim dividend and will report to the shareholders at the next Shareholders Meeting.

262

Annual Report 2011 Thanachart Bank Public Company Limited


COMPANIES IN THANACHART GROUP

THANACHART CAPITAL Public Company Limited

SIAM CITY LIFE ASSURANCE Company Limited

444 MBK Tower, 10th-11

231 Thanachart Park Place, 9th-11th Floor,

and 15th-20th Floor,

th

Phayathai Road,Wangmai, Pathumwan,

Rachadamri Road, Lumpini, Pathumwan,

Bangkok 10330, THAILAND

Bangkok 10330, THAILAND

Tel. +66 (0) 2217-8444, 2217-8000, 2611-9111

Tel. +66 (0) 2207-4200

Fax +66 (0) 2613-6099

Fax +66 (0) 2253-8484

www.thanachart.co.th

www.scilife.co.th

Registration No. 0107536000510

Registration No. 0105540057138

THANACHART BANK Public Company Limited

THANACHART LIFE ASSURANCE Company Limited

900 Tonson Tower, Ploenchit Road,

999/1 The Ninth Tower 1st, 4th-5th Floor, 999/4, 4th Floor,

Lumpini, Pathumwan,

Rama 9 Road, Suanluang,

Bangkok 10330, THAILAND

Bangkok 10250, THAILAND

Tel. +66 (0) 2655-9000

Tel. +66 (0) 2308-9400

Fax +66 (0) 2655-9001

Fax +66 (0) 2308-9444

www.thanachartbank.co.th

www.thanachartlife.co.th

Registration No. 0107536001401

Registration No. 0105540057090

THANACHART SECURITIES Public Company Limited 444 MBK Tower,

14th,

18th

and

19th

Floor,

TS ASSETS MANAGEMENT Company Limited 1101 Petchburi Building, 9th Floor,

Phayathai Road, Wangmai, Pathumwan,

New Petchburi Road, Makkasan, Ratchathewi,

Bangkok 10330, THAILAND

Bangkok 10400, THAILAND

Tel. +66 (0) 2217-8888, 2217-9595, 2611-9222

Tel. +66 (0) 2208-5555

Fax +66 (0) 2217-9642

Fax +66 (0) 2208-5892

www.tnsitrade.com

http://property.scib.co.th/property

Registration No. 0107557000591

Registration No. 0105554031624

THANACHART FUND MANAGEMENT Company Limited

THANACHART GROUP LEASING Company Limited

898 Ploenchit Tower, 15th and 18th Floor,

444 MBK Tower, 11th Floor,

Ploenchit Road, Lumpini, Pathumwan,

Phayathai Road, Wangmai, Pathumwan,

Bangkok 10330, THAILAND

Bangkok 10330, THAILAND

Tel. +66 (0) 2126-8300

Tel. +66 (0) 2217-8000, 2217-8333

Fax +66 (0) 2126-8398

Fax +66 (0) 2611-9488

www.thanachartfund.co.th

Registration No. 0105538045861

Registration No. 0105535049696

THANACHART INSURANCE Company Limited

RATCHTHANI LEASING Public Company Limited

999/1 The Nine Tower, 2nd-3rd, 5th Floor, 999/2, 4th Floor,

77/35-36 Sinn Sathorn Tower, 11upth Floor,

999/3, 4th Floor, Rama 9 Road, Suanluang,

Krung Thonburi Road, Klong Ton Sai, Klong San,

Bangkok 10250, THAILAND

Bangkok 10600, THAILAND

Tel. +66 (0) 2308-9300

Tel. +66 (0) 2440 0844

Fax +66 (0) 2308-9333

Fax +66 (0) 2440 0848

www.thanachartinsurance.co.th

www.ratchthani.com

Registration No. 0105540060091

Registration No. 0107545000209

Annual Report 2011 Thanachart Bank Public Company Limited

263


BRANCHES OF THANACHART BANK PUBLIC COMPANY LIMITED Information as of December 31, 2011

Khlong Tan Branch

Charn Issara Tower II Branch

Tel.

+66 (0) 2314-2642-4,

Tel.

+66 (0) 2308-2955-8,

+66 (0) 2719-8030

+66 (0) 2718-1834

Fax

+66 (0) 2719-8031

Fax

+66 (0) 2308-2950

Khlong Toei Branch

Chok Chai 4 Branch

Tel.

+66 (0) 2240-0161,

Tel.

+66 (0) 2931-0895-7

+66 (0) 2249-2633

Fax

+66 (0) 2931-0798

Fax

+66 (0) 2249-4789

Seacon Square Branch

HEAD OFFICE

Tonson Branch

Khlong Thom Branch

Tel.

+66 (0) 2721-8548-50

Tel.

+66 (0) 2655-9560-4

Tel.

+66 (0) 2221-1677,

Fax

+66 (0) 2721-8551

+66 (0) 2655-9585

+66 (0) 2221-1671

Fax

+66 (0) 2221-1679

Seacon Square Srinagarindra

BANGKOK AND VICINITY

Charan Sanitwong 13 Branch

Tel.

+66 (0) 2721-9955

Tonson Branch

Tel.

+66 (0) 2864-1560-3

Fax

+66 (0) 2721-8321

Tel.

+66 (0) 2655-9560-4

Fax

+66 (0) 2864-1566

Fax

+66 (0) 2655-9585

Century the Movie Plaza Branch

Charan Sanitwong 35 Branch

Tel.

+66 (0) 2245-8500-2

Phetchaburi Office Branch

Tel.

+66 (0) 2411-0511,

Fax

+66 (0) 2245-8504

Tel.

+66 (0) 2208-5000,

+66 (0) 2411-0545

+66 (0) 2253-0200-43

Fax

+66 (0) 2411-0607

+66 (0) 2253-6198

Tel.

+66 (0) 2884-9680-3

Chamchuri Square Branch

Fax

+66 (0) 2884-9684

Suan Mali Office Branch

Tel.

+66 (0) 2160-5254-6,

Tel.

+66 (0) 2225-9999,

+66 (0) 2160-5257

Central Rama II Branch

+66 (0) 2223-0561

Fax

+66 (0) 2160-5258

Tel.

+66 (0) 2872-4770

+66 (0) 2224-3810

Fax

+66 (0) 2872-4769

Cha Ru Mueang Branch

Department of Land Transport

Tel.

+66 (0) 2214-1488,

Central Rama III Branch

Branch

+66 (0) 2214-1739

Tel.

+66 (0) 2211-8260

Tel.

+66 (0) 2272-6073-5,

Fax

+66 (0) 2214-2038

Fax

+66 (0) 2211-8190

+66 (0) 2272-6076

Fax

+66 (0) 2272-6077

Charoen Krung 17 Branch

Central Ram Inthra Branch

Tel.

+66 (0) 2224-1839,

Tel.

+66 (0) 2552-7462,

Green Place (Soi Wat Phai Ngoen)

+66 (0) 2225-7194

+66 (0) 2970-5517

Branch

Fax

+66 (0) 2224-2059

Fax

+66 (0) 2970-5518

Tel.

+66 (0) 2211-3515,

+66 (0) 2211-3519-20

Charoen Nakhon Soi 36 Branch

Central Bang Na Branch

+66 (0) 2674-9704

Tel.

+66 (0) 2862-5010-6

Tel.

+66 (0) 2398-9572-3

Fax

+66 (0) 2862-5017

Fax

+66 (0) 2398-9574

Kluai Nam Thai Branch

Tel.

+66 (0) 2258-6620-1

Charoen Phon Branch

Central Plaza Grand Rama IX

+66 (0) 2258-5505

Tel.

+66 (0) 2215-6628-30

Branch

Fax

+66 (0) 2215-6627

Tel.

Crystal Design Center Branch

+66 (0) 2160-2953

Tel.

+66 (0) 2102-2410-2

Charn Issara Tower (Rama IV)

Fax

+66 (0) 2160-2954

Fax

+66 (0) 2102-2413

Branch

Tel.

+66 (0) 2267-4296-8

Central Lat Phrao Branch

Khlong Chan Branch

Fax

+66 (0) 2267-4299

Tel.

+66 (0) 2937-1279,

Tel.

+66 (0) 2937-1280

+66 (0) 2377-1368-9

Fax

+66 (0) 2937-1283

+66 (0) 2377-3609

Fax

Fax

Fax

Fax

Fax

Fax

264

+66 (0) 2377-1364,

Branch

Central Pin Klao Branch

Annual Report 2011 Thanachart Bank Public Company Limited

+66 (0) 2160-2950-52,


Central World Branch

Trok Chan Branch

Thanon Romklao Housing Branch

Tel.

+66 (0) 2646-1346-9,

Tel.

+66 (0) 2211-1286,

Tel.

+66 (0) 2646-1353

+66 (0) 2211-4511

+66 (0) 2543-9191

Fax

+66 (0) 2646-1350

Fax

+66 (0) 2211-4653

Fax

+66 (0) 2543-9192

+66 (0) 2543-9200-1,

Central World Plaza (3) Branch

Talat Bang Khun Non Branch

Thanon Chak Phet

Tel.

+66 (0) 2255-6163,

Tel.

+66 (0) 2434-6067-8,

(Pak Khlong Talat) Branch

+66 (0) 2255-9658-9

+66 (0) 2434-6078

Tel.

+66 (0) 2225-1555,

Fax

+66 (0) 2255-9657

Fax

+66 (0) 2882-4581

+66 (0) 2225-1628 +66 (0) 2623-6527

Fax

Don Mueang Branch

Talat Bang Khae Branch

Tel.

+66 (0) 2929-7004,

Tel.

+66 (0) 2801-1004-6

Thanon Chan Branch

+66 (0) 2566-1950-1

Fax

+66 (0) 2801-1007

Tel.

+66 (0) 2285-5360,

Fax

+66 (0) 2566-3425

+66 (0) 2285-5368

Talat Phlu Branch

Fax

+66 (0) 2285-5361

The Avenue Chaengwattana

Tel.

+66 (0) 2466-7404,

Branch

+66 (0) 2466-7423

Thanon Charoen Nakhon Branch

Tel.

+66 (0) 2573-0673-5

Fax

+66 (0) 2465-1767

Fax

+66 (0) 2573-0677

Tel.

+66 (0) 2438-6953-5,

+66 (0) 2860-2018 +66 (0) 2860-4355

Talat Ying Charoen Branch

Fax

The Nine (Thanon Rama IX)

Tel.

+66 (0) 2552-8043,

Branch

+66 (0) 2552-8045

Thanon Chalong Krung Branch

Tel.

+66 (0) 2319-1662-4,

Fax

+66 (0) 2972-3161

Tel.

+66 (0) 2327-8111-3

+66 (0) 2716-7868

Fax

+66 (0) 2327-8114

Fax

+66 (0) 2718-7868

Talat Saphan Mai Don Mueang

Branch

Thanon Nang Linchi Branch

The Paseo (Lat Krabang) Branch

Tel.

+66 (0) 2521-1670,

Tel.

Tel.

+66 (0) 2346-4103-4,

+66 (0) 2521-0612-3

+66 (0) 2286-1898

+66 (0) 2346-4109

Fax

+66 (0) 2521-0611

Fax

+66 (0) 2286-1939

Fax

+66 (0) 2346-4111

+66 (0) 2286-1971,

Talat Samrae Branch

Thanon Borom Rat Chonnani

The Mall Bang Kapi (2) Branch

Tel.

+66 (0) 2472-2045-50

Branch

Tel.

+66 (0) 2734-3735-6

Fax

+66 (0) 2472-2052

Tel.

+66 (0) 2446-8061-4

Fax

+66 (0) 2734-3647

Fax

+66 (0) 2446-8065

Talat Mo Chit Branch

The Mall 2 Ramkhamhaeng Branch

Tel.

+66 (0) 2278-5300-1,

Thanon Burapha (Phahurat)

Tel.

+66 (0) 2369-2486,

+66 (0) 2270-0308

Branch

+66 (0) 2369-2482

Fax

+66 (0) 2279-3411

Tel.

+66 (0) 2221-2069,

Fax

+66 (0) 2369-2484

+66 (0) 2221-5239

Taling Chan Branch

Fax

+66 (0) 2221-5128

The Mall Tha Phra Branch

Tel.

+66 (0) 2882-7790-4

+66 (0) 2882-7796

Thanon Prajadhipok

Tel.

+66 (0) 2477-7321-3

Fax

Fax

+66 (0) 2477-7324

(Wongwian Yai) Branch

Tao Pun Branch

Tel.

+66 (0) 2437-0188,

The Mall Bangkapi Branch

Tel.

+66 (0) 2587-7292,

+66 (0) 2437-2596

Tel.

+66 (0) 2375-1575

+66 (0) 2587-7284-5

Fax

+66 (0) 2437-5784

Fax

+66 (0) 2375-1686

Fax

+66 (0) 2587-7379

Thanon Pracha Uthit

The Mall Bang Khae Branch

TOYOTA BUZZ Kaset-Nawamin

(Thung Khru) Branch

Tel.

+66 (0) 2803-8310

Branch

Tel.

+66 (0) 2426-7017-9,

Fax

+66 (0) 2803-8305

Tel.

+66 (0) 2561-0069-71,

+66 (0) 2873-4029

+66 (0) 2561-0072

Fax

+66 (0) 2873-4030

The Mall Bang Khae (2) Branch

Fax

+66 (0) 2561-0073

Tel.

+66 (0) 2803-8373-4

Fax

+66 (0) 2803-8375

Annual Report 2011 Thanachart Bank Public Company Limited

265


Tops RCA Branch

Thanon Rama II

Thanon Witthayu

(Thon Buri Housing 3) Branch

(All Seasons Place) Branch

Tel.

+66 (0) 2203-0267-9,

Tel.

Tel.

+66 (0) 2252-6784-5

+66 (0) 2641-5120

+66 (0) 2252-6786

Fax

+66 (0) 2641-5121

+66 (0) 2451-4402,

+66 (0) 2451-4460

Fax

Fax

+66 (0) 2451-4882

Thanon Sathon Tai

Tha Din Daeng Branch

Thanon Rama II (Soi 3) Branch

(Thai CC Tower) Branch

Tel.

+66 (0) 2863-1283-8

Tel.

+66 (0) 2427-1552-3

Tel.

+66 (0) 2675-5697-9,

Fax

+66 (0) 2863-1289

Fax

+66 (0) 2427-1551

+66 (0) 2675-5700

Fax

+66 (0) 2675-5701

Tha Phra Chan Branch

Thanon Rama IX Branch

Tel.

+66 (0) 2221-6486,

Tel.

Thanon Sathon Nuea Branch

+66 (0) 2225-4466

Fax- +66 (0) 2246-8473

Tel.

+66 (0) 2267-7512-4,

Fax

+66 (0) 2225-8933

+66 (0) 2637-8651

Thanon Phrasumen

Fax

+66 (0) 2637-8975

Thewet Branch

(Bang Lamphu) Branch

Tel.

Tel.

+66 (0) 2281-6821,

Thanon Sirindhorn Branch

+66 (0) 2628-7247

+66 (0) 2281-6332

Tel. +66 (0) 2434-5028-9,

Fax

+66 (0) 2282-8810

Fax

+66 (0) 2281-7457

+66 (0) 2246-7829-30

+66 (0) 2628-7240-4,

+66 (0) 2434-5947-8

Fax

+66 (0) 2434-5661

Tesco Lotus Bang Kapi Branch

Thanon Phatthanakan Branch

Tel.

+66 (0) 2377-8029,

Tel.

+66 (0) 2369-2814-7

Thanon Suea Pa Branch

+66 (0) 2377-8457

Fax

+66 (0) 2369-2818

Tel.

+66 (0) 2221-4327-9,

Fax

+66 (0) 2377-8508

+66 (0) 2623-0578

Thanon Phatthanakan 22 Branch

Fax

+66 (0) 2623-0579

Tel.

+66 (0) 2318-7241-2,

Tel.

+66 (0) 2318-7620

Arun Ammarin Branch

+66 (0) 2415-9133

Fax

+66 (0) 2318-7393

Tel.

+66 (0) 2424-0888,

Fax

+66 (0) 2892-8004

+66 (0) 2424-0999

Thanon Petchaburi Soi 20 Branch

Fax

+66 (0) 2433-7061

Tesco Lotus Rama IV Branch

Tel.

+66 (0) 2251-6018,

Tel.

+66 (0) 2249-7533-5,

+66 (0) 2251-6852

Thanon Ekkachai (Bang Bon 5)

+66 (0) 2249-7536

Fax

+66 (0) 2252-6935

Branch

Fax

+66 (0) 2249-7537

Tel.

+66 (0) 2450-3741-3

Thanon Petchaburi Tat Mai Branch

Fax

+66 (0) 2450-3744

Tesco Lotus Phet Kasem 81 Branch

Tel.

+66 (0) 2254-0252-4

Tel.

Fax

+66 (0) 2254-0255

Thong Lo Branch

+66 (0) 2812-4072

Tel.

+66 (0) 2381-8421-2,

Fax

+66 (0) 2812-4073

Thanon Pho Phanit (Ratchawong)

+66 (0) 2381-8364-5

Branch

Fax

+66 (0) 2381-8423

Tel.

+66 (0) 2622-9050,

Tel.

+66 (0) 2622-4093

Thong Lo Soi 17 Branch

+66 (0) 2512-1963

Fax

+66 (0) 2622-9029

Tel.

+66 (0) 2185-2756,

Fax

+66 (0) 2939-3043

+66 (0) 2185-2758-61

Thanon Mangkon Branch

Fax

+66 (0) 2185-2757

Tesco Lotus Wang Hin Branch

Tel.

+66 (0) 2225-3331,

Tel.

+66 (0) 2578-6194-6

+66 (0) 2225-3863

Thong Lo Soi 3 Branch

Fax

+66 (0) 2578-6197

Fax

+66 (0) 2225-8364

Tel.

+66 (0) 2392-5802-4,

+66 (0) 2712-8245

Thian Kua Thian Branch

Thanon Ramkhamhaeng 2 Branch

Fax

+66 (0) 2712-8168

Tel.

+66 (0) 2397-6173-5,

+66 (0) 2728-4060

Fax

+66 (0) 2728-4061

+66 (0) 2392-0527-8

Fax

+66 (0) 2391-1862

+66 (0) 2415-9130-2,

+66 (0) 2489-2087-9,

Tesco Lotus Lat Phrao Branch +66 (0) 2512-1955,

Tel.

+66 (0) 2221-3575-6,

+66 (0) 2622-9063

Thong Lo Soi 7 Branch

Fax

+66 (0) 2221-3575

Tel.

266

Tesco Lotus Rama II Branch

Annual Report 2011 Thanachart Bank Public Company Limited


Big C Bang Bon Branch

Thai Summit Tower

Bang Na Branch

(Thanon Petchaburi Tat Mai)

Tel.

+66 (0) 2397-3757

Tel.

+66 (0) 2416-9969-71

Branch

Fax

+66 (0) 2398-0185

Fax

+66 (0) 2416-9974

Tel.

+66 (0) 2252-6458,

+66 (0) 2251-1327

Bang Na-Trat km. 4 Branch

Big C Phet Kasem Branch

Fax

+66 (0) 2251-1357

Tel.

+66 (0) 2399-2841-4,

Tel.

+66 (0) 2399-2844

+66 (0) 2444-2904

Thaniya Branch

Fax

+66 (0) 2399-2845

Fax

+66 (0) 2444-2909

Tel.

+66 (0) 2236-3520-1,

+66 (0) 2236-5339

Bang Bon Branch

Big C Sukhaphiban 3

Fax

+66 (0) 22369119

Tel.

+66 (0) 2899-8533-5

(Ramkhamhaeng) Branch

Fax

+66 (0) 2899-8540

Tel.

Nawamin 42 Branch

+66 (0) 2916-3604

Tel.

+66 (0) 2375-1281-2,

Bang Phlat Branch

Fax

+66 (0) 2916-3607

+66 (0) 2375-1284

Tel.

+66 (0) 2435-7205,

Fax

+66 (0) 2375-1285

+66 (0) 2435-6808-10

Big C Sukhaphiban 5 Branch

Fax

+66 (0) 2435-6807

Nawamin 66 Branch

Tel.

+66 (0) 2519-5724,

+66 (0) 2519-4616

Fax

+66 (0) 2519-4627

+66 (0) 2444-2927,

+66 (0) 2916-3584-5,

Tel.

+66 (0) 2153-1513-4,

+66 (0) 2153-1566

Bang Mod Branch

Fax

+66 (0) 2153-1567

Tel.

+66 (0) 2428-7014-5,

+66 (0) 2428-6913-6

Big C Ekkamai Branch

Fax

+66 (0) 2428-6994

Tel.

+66 (0) 2714-8274-7

Nawamin Market Place Branch

Fax

+66 (0) 2714-8268

Tel.

+66 (0) 2519-1142,

Bang Yi Ruea Branch

+66 (0) 2519-1154

Tel.

+66 (0) 2472-2664-7

Bo Bae Branch

Fax

+66 (0) 2946-7432

Fax

+66 (0) 2472-2668

Tel.

+66 (0) 2356-0755-8

Fax

+66 (0) 2356-0759

Nang Loeng Branch

Bang Rak Branch

Tel.

+66 (0) 2281-0842,

Tel.

+66 (0) 2234-4227-9,

Bobae Tower Branch

+66 (0) 2281-2169

+66 (0) 2630-9026

Tel.

+66 (0) 2628-1693-5,

Fax

+66 (0) 2281-2322

Fax

+66 (0) 2630-9027

+66 (0) 2628-1690 +66 (0) 2628-1696

Fax

Na Na Nuea Branch

Bang Lamphu Branch

Tel.

+66 (0) 2252-0709,

Tel.

+66 (0) 2356-0783,

Baiyoke Pratu Nam Branch

+66 (0) 2252-6540

+66 (0) 2356-0782

Tel.

+66 (0) 2208-0824-5

Fax

+66 (0) 2253-5668

Fax

+66 (0) 2356-0787

Fax

+66 (0) 2208-0826

Bang Khun Non Branch

Bamrung Mueang Branch

PTT Thanon Seri Thai Branch

Tel.

+66 (0) 2424-9778-9,

Tel.

+66 (0) 2216-9794-7,

Tel

+66 (0) 2187-2009-11,

+66 (0) 2433-6028-9

+66 (0) 2214-0606-8

+66 (0) 2187-2012

Fax

+66 (0) 2434-9772

Fax

+66 (0) 2216-9798

Fax

+66 (0) 2187-2013

Bang Khae Branch

Big C Chaeng Wattana Branch

Pracha Chuen Branch

Tel.

+66 (0) 2454-6225-7,

Tel.

+66 (0) 2574-3525-7

Tel.

+66 (0) 2585-6811,

+66 (0) 2454-2790-2

Fax

+66 (0) 2574-3528

+66 (0) 2585-9656

Fax

+66 (0) 2413-1329

Fax

+66 (0) 2585-2666

Big C Don Mueang Branch

Bang Khlo Branch

Tel.

+66 (0) 2551-0638-9,

Pracha Uthit Branch

Tel.

+66 (0) 2289-4223,

+66 (0) 2551-0641

Tel.

+66 (0) 2289-4236

Fax

+66 (0) 2551-0642

+66 (0) 2873-5848

Fax

+66 (0) 2289-4159

Fax

+66 (0) 2873-5849

+66 (0) 2873-4721-3,

Big C Bang Na Branch

Bang Sue Branch

Tel.

+66 (0) 2396-0482,

Pracha Uthit (Huai Khwang)

Tel.

+66 (0) 2587-0616,

+66 (0) 2396-0484-5

Branch

+66 (0) 2587-0686

Fax

+66 (0) 2396-0500

Tel.

+66 (0) 2934-4181-3

Fax

+66 (0) 2585-9659

Fax

+66 (0) 2934-4184

Annual Report 2011 Thanachart Bank Public Company Limited

267


Pratu Nam Branch

Phahurat Branch

Union Mall Lat Phrao Branch

Tel.

+66 (0) 2208-0072,

Tel.

+66 (0) 2221-4409,

Tel.

+66 (0) 2511-0236,

+66 (0) 2208-0074-5

+66 (0) 2623-8097

+66 (0) 2511-0246

Fax

+66 (0) 2208-0076

Fax

+66 (0) 2623 8098

Fax

+66 (0) 2511-0268

Prawet Branch

P.B. Tower (Khlong Tan) Branch

Union Mall (2) Branch

Tel.

+66 (0) 2322-2223,

Tel.

+66 (0) 2381-3114-5,

Tel.

+66 (0) 2512-4304,

+66 (0) 2722-1371

+66 (0) 2381-3121-2

+66 (0) 2512-2040

Fax

+66 (0) 2322-8943

Fax

+66 (0) 2381-3124

Fax

+66 (0) 2512-5516

Pak Khlong Talat Branch

Phet Kasem Branch

Yaowarat Branch

Tel.

+66 (0) 2221-7511,

Tel.

+66 (0) 2456-0337-42

Tel.

+66 (0) 2221-1868,

+66 (0) 2222-0686

Fax

+66 (0) 2454-4116

+66 (0) 2221-1845-7

Fax

+66 (0) 2222-4794

Fax

+66 (0) 2221-1869

Phet Kasem 69 Branch

Pin Klao Branch

Tel.

+66 (0) 2809-3034-8

Ratchada Phisek Branch

Tel.

+66 (0) 2435-4273-4,

Fax

+66 (0) 2809-3041

Tel.

+66 (0) 2641-2225-8

+66 (0) 2435-4577-8

Fax

+66 (0) 2641-3233

Fax

+66 (0) 2435-4518

Phloen Chit Center Branch

Tel.

+66 (0) 2656-8403-7

Ratchada Phisek

Rama III Branch

Fax

+66 (0) 2656-8400

(Glas Haus Building) Branch

Tel.

+66 (0) 2682-7322-6,

Tel.

+66 (0) 2693-9811,

+66 (0) 2682-7328-9

Platinum Pratu Nam Branch

+66 (0) 2290-3500

Fax

+66 (0) 2682-7327

Tel.

+66 (0) 2121-9683-5,

Fax

+66 (0) 2693-9820

+66 (0) 2121-9686

Rama IV Branch

Fax

+66 (0) 2121-9687

Ratchada Phisek-Tha Phra Branch

Tel.

+66 (0) 2249-4201-3,

Tel.

+66 (0) 2878-8845-50

+66 (0) 2671-0260

Fashion Island Branch

Fax

+66 (0) 2878-8852

Fax

+66 (0) 2249-4204

Tel.

+66 (0) 2519-5784,

+66 (0) 2519-5753

Ratchada-Huai Khwang Branch

Phran Nok Branch

Fax

+66 (0) 2519-5718

Tel.

+66 (0) 2694-1489-91,

Tel.

+66 (0) 2418-0785,

+66 (0) 2694-1495

+66 (0) 2418-0787

Fashion Island (2) Branch

Fax

+66 (0) 2694-1496

Fax

+66 (0) 2418-0786

Tel.

+66 (0) 2947-6402-5

Fax

+66 (0) 2947-6410

Ratchadamnoen Branch

Phlapphlachai Branch

Tel.

+66 (0) 2221-3391,

Tel.

+66 (0) 2224-6922-3,

Money Park Branch

+66 (0) 2223-6010

+66 (0) 2224-6931

Tel.

+66 (0) 2686-3960-1,

Fax

+66 (0) 2222-9635

Fax

+66 (0) 2224-6947

+66 (0) 2686-3962

Fax

+66 (0) 2686-3959

Ratchadamnoen Klang Branch

Phahon Yothin Soi 6 Branch

Tel.

Tel.

+66 (0) 2279-9874-5

Mah Boon Krong Branch

+66 (0) 2621-2185

Fax

+66 (0) 2279-9895

Tel.

+66 (0) 2611-5710-4

Fax

+66 (0) 2621-2186

Fax

+66 (0) 2611-5717

Phahon Yothin Soi 9 Branch

Tel.

+66 (0) 2270-1371-3,

Min Buri Branch

Tel.

+66 (0) 2251-3113,

+66 (0) 2619-6399

Tel.

+66 (0) 2517-8014-5,

+66 (0) 2251-4314

Fax

+66 (0) 2619-6339

+66 (0) 2517-9321

Fax

+66 (0) 2251-4316

Fax

+66 (0) 2517-8016

+66 (0) 2226-3083-5,

Ratchadamri Branch

Ratcha Prarop Branch

Phatthanakan Branch

Tel.

+66 (0) 2719-4580-3

Major Ratchayothin Branch

Tel.

+66 (0) 2245-4968-9,

Fax

+66 (0) 2719-4591

Tel.

+66 (0) 2512-1082,

+66 (0) 2642-6054-5

+66 (0) 2512-1102

Fax

+66 (0) 2245-0882

Paradise Park Branch

Fax

+66 (0) 2939-5372

Tel.

+66 (0) 2325-9072-4

Fax

+66 (0) 2325-9075

268

Annual Report 2011 Thanachart Bank Public Company Limited


Ratchawong Branch

Paolo Memorial Hospital

Leng Noei Yi Branch

Tel.

+66 (0) 2224-5705,

Chok Chai 4 Branch

Tel.

+66 (0) 2221-1248,

+66 (0) 2224-5870

Tel.

+66 (0) 2514-3277,

+66 (0) 2221-3501

Fax

+66 (0) 2224-5792

+66 (0) 2933-2291

Fax

+66 (0) 2223-3211

Fax

+66 (0) 2933-2292

Wongwian Yai Branch

Ratcha Wat Branch

Tel.

+66 (0) 2241-0868,

Ramkhamhaeng Hospital Branch

Tel.

+66 (0) 2438-2486,

+66 (0) 2243-6183

Tel.

+66 (0) 2374-1523-5,

+66 (0) 2438-2562

Fax

+66 (0) 2241-1483

+66 (0) 2374-1561

Fax

+66 (0) 2438-2568

Fax

+66 (0) 2374-1562

Wong Sawang Branch

Ramkhamhaeng 155 Branch

Tel.

+66 (0) 2373-0005,

Lat Phrao Hospital Branch

Tel.

+66 (0) 2834-9999,

+66 (0) 2373-0007-8

Tel.

+66 (0) 2932-2473-5,

+66 (0) 2834-9900

Fax

+66 (0) 2373-0004

+66 (0) 2932-2529

Fax

+66 (0) 2834-9905

Fax

+66 (0) 2932-2530

Wong Sawang Town Center Branch

Ramkhamhaeng 73 Branch

Tel.

+66 (0) 2375-2126-7,

Vichaiyut Hospital Branch

Tel.

+66 (0) 2586-0420-2

+66 (0) 2374-9644

Tel.

+66 (0) 2278-2194-6

Fax

+66 (0) 2910-7949

Fax

+66 (0) 2375-2452

Fax

+66 (0) 2278-2606

Watcharaphon Branch

Ramkhamhaeng Soi 122 Branch

Samitivej Hospital Sukhumwit 49

Tel.

+66 (0) 2508-2185-7

Tel.

+66 (0) 2372-2377-9

Branch

Fax

+66 (0) 2508-2207

Fax

+66 (0) 2728-2950

Tel.

+66 (0) 2712-7013-4

Fax

+66 (0) 2712-7016

Wat Phra Ya Kai Branch

Ramkhamhaeng Soi 129 Branch

Tel.

+66 (0) 2289-3026-7,

Tel.

+66 (0) 2372-3318-20,

Lat Krabang Branch

+66 (0) 2289-5033

+66 (0) 2729-5625

Tel.

+66 (0) 2327-2754-7

Fax

+66 (0) 2289-5032

Fax

+66 (0) 2729-5832

Fax

+66 (0) 2327-2706

Wutthakat Branch

Ramkhamhaeng Soi 24 Branch

Lat Phrao Branch

Tel.

+66 (0) 2249-4201-3,

Tel.

+66 (0) 2300-4957-8,

Tel.

+66 (0) 2512-2343-4,

+66 (0) 2466-6160

+66 (0) 2300-4956

+66 (0) 2938-2433

Fax

+66 (0) 2472-5838

Fax

+66 (0) 2719-1258

Fax

+66 (0) 2512-2342

Woeng Nakhon Khasem Branch

Ram Inthra Branch

Lat Phrao 118 Branch

Tel.

Tel.

+66 (0) 2943-5630-2,

Tel.

+66 (0) 2539-2925-7

+66 (0) 2221-7201-4

+66 (0) 2519-0824-5

Fax

+66 (0) 2530-4348

Fax

+66 (0) 2222-6475

Fax

+66 (0) 2519-0826

+66 (0) 2222-2430,

Lat Phrao 53 Branch

Si Worachak Branch

Ram Inthra (Km. 7) Branch

Tel.

+66 (0) 2539-1167,

Tel.

+66 (0) 2222-1912,

Tel.

+66 (0) 2510-9610,

+66 (0) 2553-9150-7

+66 (0) 2222-1917

+66 (0) 2510-9882

Fax

+66 (0) 2539-2261

Fax

+66 (0) 2622-9338

Fax

+66 (0) 2510-9197

Lat Phrao 80 Branch

Siwara Branch

Ram Inthra (Km. 8) Branch

Tel.

+66 (0) 2933-9172,

Tel.

+66 (0) 2538-8466,

Tel.

+66 (0) 2510-6900,

+66 (0) 2933-9174-5

+66 (0) 2538-8986

+66 (0) 2510-2342

Fax

+66 (0) 2933-9178

Fax

+66 (0) 2538-9378

Fax

+66 (0) 2510-9875

Lat Phrao Soi 101 Branch

Appeal Court Branch

Navaminthra 9 Hospital Branch

Tel.

+66 (0) 2187-0162-4,

Tel.

+66 (0) 2938-3421-6

Tel.

+66 (0) 2518-1100,

+66 (0) 2187-0165

Fax

+66 (0) 2938-3428

+66 (0) 2518-2360-1

Fax

+66 (0) 2187-0161

Fax

+66 (0) 2518-2363

Sirirat Branch

Lam Sa Li Branch

Tel.

+66 (0) 2412-4515,

Tel.

+66 (0) 2735-2060-3

+66 (0) 2412-4583-4

Fax

+66 (0) 2735-2067

Fax

+66 (0) 2866-3218

Annual Report 2011 Thanachart Bank Public Company Limited

269


Vichaiyut Medical Center Branch

Rama VII Bridge (Bang Phlat)

Si Yaek Chaloem Buri

Tel.

+66 (0) 2357-1916-8

Branch

(Yaowarat) Branch

Fax

+66 (0) 2619-7043

Tel.

+66 (0) 2423-9011-3,

Tel.

+66 (0) 2221-1236,

+66 (0) 2423-9014

+66 (0) 2221-7194

The Government Complex

Fax

+66 (0) 2423-9015

Fax

+66 (0) 2225-0580

Commemorating (Building A)

Branch

Saphan Mai Don Mueang Branch

Si Yaek Ban Khaek Branch

Tel.

+66 (0) 2143-9631-33

Tel.

+66 (0) 2970-4400-3

Tel.

+66 (0) 2465-2115,

Fax

+66 (0) 2143-9634

Fax

+66 (0) 2970-4408

+66 (0) 2466-1950 +66 (0) 2465-5071

Fax

The Government Complex

Sathu Pradit 49 Branch

Commemorating Chaengwattana

Tel.

+66 (0) 2682-0610-8

Si Yaek Prawet Branch

(Building B) Branch

Fax

+66 (0) 2682-0619

Tel.

+66 (0) 2328-8023-5

Tel.

+66 (0) 2143-9393-5,

Fax

+66 (0) 2328-8027

+66 (0) 2143-9396

Sam Yan Branch

Fax

+66 (0) 2143-9397

Tel.

+66 (0) 2215-1549,

Silom Branch

+66 (0) 2215-4199

Tel.

+66 (0) 2266-7414,

Sanam Pao Branch

Fax

+66 (0) 2216-6170

+66 (0) 2266-7417-8

Tel.

+66 (0) 2271-0026-8,

Fax

+66 (0) 2266-7416

+66 (0) 2271-0029

Sam Yaek Branch

Fax

+66 (0) 2271-0030

Tel.

+66 (0) 2223-2706-8

Silom (Thanon Pan) Branch

Fax

+66 (0) 2223-2705

Tel.

+66 (0) 2237-9317-20,

Siam Discovery Branch

+66 (0) 2235-5800-2

Tel.

+66 (0) 2658-0491-3

Sam Yaek Fai Chai Branch

Fax

+66 (0) 2237-9321

Fax

+66 (0) 2658-0494

Tel.

+66 (0) 2411-3446,

+66 (0) 2418-3575-6

Silom Soi 15 Branch

Siam Paragon Branch

Fax

+66 (0) 2411-2321

Tel.

+66 (0) 2129-4374-7

Fax

+66 (0) 2129-4372

Tel.

+66 (0) 2237-4192-4,

+66 (0) 2635-0272

Sam Pheng Branch

Fax

+66 (0) 2635-0270

Tel.

+66 (0) 2222-7396,

Siam Square Branch

+66 (0) 2222-7551

Silom Complex Branch

Tel.

+66 (0) 2252-7363-5,

Fax

+66 (0) 2225-8468

Tel.

+66 (0) 2235-8832

+66 (0) 2252-7366

Fax

+66 (0) 2235-8833

Fax

+66 (0) 2252-7367

Samrae Branch

Tel.

+66 (0) 2468-0609,

Sukhumwit 71 Branch

Song Prapha Branch

+66 (0) 2468-1008-9

Tel.

+66 (0) 2391-6067,

Tel.

+66 (0) 2928-8542-5

Fax

+66 (0) 2476-5423

+66 (0) 2392-5944

Fax

+66 (0) 2928-8546

Fax

+66 (0) 2392-2534

Si Kak Phra Ya Si Branch

Suan Phlu Branch

Tel.

+66 (0) 2222-4477-8,

Sukhumwit Soi 101/1 (Piyarom Place)

Tel.

+66 (0) 2287-3084-5,

+66 (0) 2226-2267

Branch

+66 (0) 2679-3027

Fax

+66 (0) 2225-7036

Fax

+66 (0) 2679-3028

Tel.

+66 (0) 2332-7060-2,

+66 (0) 2741-8016 +66 (0) 2741-8017

Si Phra Ya Branch

Fax

Suan Lumphini (Thanon Sarasin)

Tel.

+66 (2) 2335-3057,

Branch

+66 (0) 2672-1914

Sukhumwit Soi 25 Branch

Tel.

+66 (0) 2252-2677-8,

Fax

+66 (0) 2233-4174

Tel.

+66 (0) 2651-9037

+66 (0) 2259-4726

Fax

+66 (0) 2252-2679

Si Yaek Kaset Branch

Fax

+66 (0) 2259-4730

Tel.

+66 (0) 2579-1340,

Saphan Khwai Branch

+66 (0) 2579-3483

Sukhumwit Soi 47 Branch

Tel.

+66 (0) 2279-3942,

Fax

+66 (0) 2579-6794

+66 (0) 2279-5633

Fax

+66 (0) 2616-6747

270

Tel.

+66 (0) 2204-0307-9,

+66 (0) 2662-7708

Fax

+66 (0) 2662-5632

Annual Report 2011 Thanachart Bank Public Company Limited

+66 (0) 2259-4727-9,


Sukhumwit Soi 66 Branch

On Nuch 52 Branch

Esplanade Ratchada Branch

Tel.

+66 (0) 2393-7123,

Tel.

+66 (0) 2322-1557-9

Tel.

+66 (0) 2354-2052-4

+66 (0) 2395-5959

Fax

+66 (0) 2322-1556

Fax

+66 (0) 2660-9250

Fax

+66 (0) 2399-2399

All Seasons Place Branch

IT Square Branch

Sutthi San Branch

Tel.

+66 (0) 2250-7611-3,

Tel.

+66 (0) 2576-0104-5

Tel.

+66 (0) 2616-3553-8

+66 (0) 2250-7614

Fax

+66 (0) 2576-0106

Fax

+66 (0) 2616-3561

Fax

+66 (0) 2250-7615

VICINITY

Surawong Branch

B.B. Building (Asok) Branch

Tel.

+66 (0) 2234-5964-6,

Tel.

+66 (0) 2204-1695-7,

King Kaeo Branch

+66 (0) 2631-7030

+66 (0) 2204-1698

Tel.

+66 (0) 2316-1990-2,

Fax

+66 (0) 2631-7031

Fax

+66 (0) 2204-1699

+66 (0) 2750-0184-5 +66 (0) 2317-1312

Fax

Seri Thai 32 Branch

Berli Jucker House (Kluai Nam Thai)

Tel.

+66 (0) 2376-1043-46

Branch

Khru Nai Branch

Fax

+66 (0) 2376-1122

Tel.

+66 (0) 2381-5065-7

Tel.

+66 (0) 2462-8020,

Fax

+66 (0) 2381-5068

+66 (0) 2462-8034

Nong Khaem Branch

Fax

+66 (0) 2462-6193

Tel.

+66 (0) 2445-4788,

Vorawat Building Silom Branch

+66 (0) 2445-4790-2

Tel.

+66 (0) 2635-1150-2

Khlong Luang Branch

Fax

+66 (0) 2445-4789

Fax

+66 (0) 2635-1157

Tel.

+66 (0) 2516-1230-3,

+66 (0) 2516-1202 +66 (0) 2516-1203

Huai Khwang Branch

Vibulthani Tower (Rama IV) Branch

Fax

Tel.

+66 (0) 2692-0061,

Tel.

+66 (0) 2661-5534-7

+66 (0) 2692-2098-100

Fax

+66 (0) 2661-5539

Chaeng Wattana Branch

Fax

+66 (0) 2276-1134

Tel.

+66 (0) 2982-9192-5

Siam Kit Building Branch

Fax

+66 (0) 2982-9441

Hua Lam Phong Branch

Tel.

+66 (0) 2251-6763,

Tel.

+66 (0) 2237-9710-4

+66 (0) 2252-5252

Chaeng Wattana (Software Park)

Fax

+66 (0) 2237-9713

Fax

+66 (0) 2253-9429

Branch

Tel.

+66 (0) 2962-0066,

Hua Mak Branch

India Emporium Branch

+66 (0) 2962-0415-6

Tel.

+66 (0) 2314-2627,

Tel.

+66 (0) 2224-0133,

Fax

+66 (0) 2962-0376

+66 (0) 2314-0086-7

+66 (0) 2224-0135

Fax

+66 (0) 2314-7277

Fax

+66 (0) 2623-9434

Central Chaengwattana Branch

Tel.

+66 (0) 2193-8114-6,

Anu Wong Branch

Udom Suk Branch

+66 (0) 2101-0709

Tel.

+66 (0) 2222-0161-3,

Tel.

+66 (0) 2398-4024-7

Fax

+66 (0) 2101-0710

+66 (0) 2222-0169

Fax

+66 (0) 2398-4028

Fax

+66 (0) 2225-8931

Central Rattanathibet Branch

Ekkamai 28 Branch

Tel.

Victory Monument Branch

Tel.

+66 (0) 2392-2831,

+66 (0) 2525-4736-8, +66 (0) 2969-7536

Tel.

+66 (0) 2644-7474-6,

+66 (0) 2392-7278-9

Fax

+66 (0) 2969-7537

+66 (0) 2354-9330-1

Fax

+66 (0) 2392-2832

Fax

+66 (0) 2354-9351

Zeer-Rangsit Branch

MBK Center Branch

Tel.

+66 (0) 2992-6807-9

Asok Branch

Tel.

+66 (0) 2611-4752-4,

Fax

+66 (0) 2992-6810

Tel.

+66 (0) 2260-7831-4

+66 (0) 2611-4843

Fax

+66 (0) 2260-7839

Fax

+66 (0) 2611-4751

The Mall Ngamwongwan Branch

Tel.

Asok-Din Daeng Branch

MBK Tower Branch

+66 (0) 2550-1234

Tel.

+66 (0) 2641-7547-9

Tel.

+66 (0) 2611-9480

Fax

+66 (0) 2550-1235

Fax

+66 (0) 2641-7566

Fax

+66 (0) 2611-9557

+66 (0) 2550-1231-3,

Annual Report 2011 Thanachart Bank Public Company Limited

271


Talat Klang Bang Yai Branch

Tesco Lotus Lam Luk Ka Khlong 6

Big C Bang Phli Branch

Tel.

+66 (0) 2595-0682-4

Branch

Tel.

+66 (0) 2312-2284,

Fax

+66 (0) 2595-0685

Tel.

+66 (0) 2569-1694,

+66 (0) 2312-2300

+66 (0) 2998-8163

Fax

+66 (0) 2312-2321

Talat Thai Branch

Fax

+66 (0) 2998-8164

Tel.

+66 (0) 2529-6171-2,

+66 (0) 2529-6173

Tesco Lotus Srinagarindra Branch

Tel.

+66 (0) 2752-5632-3

Fax

+66 (0) 2529-6175

Tel.

+66 (0) 2175-7844-6,

Fax

+66 (0) 2752-5635

+66 (0) 2759-9053

Talat Bang Bua Thong Branch

Fax

+66 (0) 2759-9054

Big C Samut Prakan Branch

Tel.

+66 (0) 2571-3598-9,

Tel.

+66 (0) 2571-3373-5

Tesco Lotus Samakkhi Branch

+66 (0) 2702-1859

Fax

+66 (0) 2571-7845

Tel.

+66 (0) 2582-8146-8,

Fax

+66 (0) 2702-1982

+66 (0) 2997-6041

Talat Pak Nam Branch

Fax

+66 (0) 2997-6042

Big C Samrong 2 Branch

Tel.

+66 (0) 2702-8380-4

Tel.

+66 (0) 2380-1100-2,

Fax

+66 (0) 2702-8388

Nonthaburi Branch

+66 (0) 2755-0239

Tel.

+66 (0) 2526-3453-6

Fax

+66 (0) 2755-0240

Talat Samrong Branch

Fax

+66 (0) 2526-3457

Tel.

+66 (0) 2756-8411-4

Fax

+66 (0) 2756-8419

Navanakhon Branch

Tel.

+66 (0) 2463-7700,

Tel.

+66 (0) 2909-0620-3,

+66 (0) 2463-1894-6

Thanon Rangsit-Pathum Thani Branch

+66 (0) 2909-0626

Fax

+66 (0) 2463-7144

Tel.

+66 (0) 2567-5808,

Fax

+66 (0) 2909-0625

+66 (0) 2567-2738-9

Fax

+66 (0) 25675809

Bang Pu Industrial Estate Branch

Tel.

+66 (0) 2463-0992-3

Tel.

+66 (0) 2324-0360,

Fax

+66 (0) 2463-0980

Thanon Samakkhi Branch

+66 (0) 2324-0364

Tel.

+66 (0) 2574-2794-5

Fax

+66 (0) 2324-0805

Pathum Thani Branch

Fax

+66 (0) 2574-2793

Tel.

+66 (0) 2581-5766,

Bang Kruai Branch

+66 (0) 2581-6976

Tha Nam Nonthaburi Branch

Tel.

+66 (0) 2447-2897,

Fax

+66 (0) 2581-6925

Tel.

+66 (0) 2527-0255-60

+66 (0) 2447-5095

Fax

+66 (0) 2527-0254

Fax

+66 (0) 2883-8619

Pak Kret Branch

Big C Bang Phli (2) Branch

+66 (0) 2702-1792-3,

Big C Suk Sawat (2) Branch

Big C Suk Sawat Branch

Tel.

+66 (0) 2960-9928-30,

Tha Nam Phra Pradaeng Branch

Bang Khru Branch

+66 (0) 2583-7246

Tel.

+66 (0) 2463-0488,

Tel.

+66 (0) 2817-5417-19

Fax

+66 (0) 2583-7562

+66 (0) 2463-2228

Fax

+66 (0) 2817-5423

Fax

+66 (0) 2464-2156

Pak Nam Branch

Bang Bua Thong Branch

Tel.

+66 (0) 2173-7882-4,

Thepharak Branch

Tel.

+66 (0) 2571-7124,

+66 (0) 2702-8036 +66 (0) 2702-8037

Tel.

+66 (0) 2759-6061-4,

+66 (0) 2920-6621

Fax

+66 (0) 2759-6066

Fax

+66 (0) 2920-9603

Fax

+66 (0) 2759-6067

Pu Chao Saming Prai Branch

Bang Pu Branch

Tel.

+66 (0) 2183-2044,

Tesco Lotus Navanakhon Branch

Tel.

+66 (0) 2323-2960-3

+66 (0) 2183-2046-7

Tel.

+66 (0) 2529-6187-9,

Fax

+66 (0) 2323-2964

Fax

+66 (0) 2183-2043

+66 (0) 2529-6186

Fax

+66 (0) 2909-7097

Bang Yai Branch

Phra Pradaeng Branch

Tel.

+66 (0) 2594-1143,

Tel.

+66 (0) 2463-3940-1,

Tesco Lotus Rattanathibet Branch

+66 (0) 2594-1152

+66 (0) 2463-3841-57

Tel.

+66 (0) 2950-1160,

Fax

+66 (0) 2594-1161

Fax

+66 (0) 2463-6897

+66 (0) 2950-1297

Fax

+66 (0) 2950-1157

272

Annual Report 2011 Thanachart Bank Public Company Limited


Pantip Plaza Ngamwongwan Branch

Sam Yaek Phra Pradaeng Branch

Kamphaeng Saen Branch

Tel.

+66 (0) 2953-5056-7

Tel.

+66 (0) 2463-2156-7,

Tel.

+66 (0) 3435-1100,

Fax

+66 (0) 2953-5058

+66 (0) 2462-6284

+66 (0) 3435-1614

Fax

+66 (0) 2462-5355

Fax

+66 (0) 3435-1094

Future Park Rangsit Branch

Tel.

+66 (0) 2958-5116-8,

Samrong Branch

Kaeng Khoi Branch

+66 (0) 2958-5119

Tel.

+66 (0) 2396-0278-80,

Tel.

+66 (0) 3624-4176,

Fax

+66 (0) 2958-5121

+66 (0) 2745-3482-3

+66 (0) 3624-4179

Fax

+66 (0) 2399-5103

Fax

+66 (0) 3624-4178

Future Park Rangsit (2) Branch

Tel.

+66 (0) 2958-0914-5

Samrong Nuea Branch

304 Industrial Park Branch

Fax

+66 (0) 2958-0917

Tel.

+66 (0) 2384-7141,

Tel.

+66 (0) 3741-4378-80

+66 (0) 2384-7244

Fax

+66 (0) 3741-4381

Huachiew Chalermprakiet University

Fax

+66 (0) 2384-7678

Branch

Tel.

+66 (0) 2312-6600-5

Si Mum Mueang-Rangsit Branch

Tel.

+66 (0) 3242-5350,

Fax

+66 (0) 2312-6603

Tel.

+66 (0) 2531-9774,

+66 (0) 3242-8352

+66 (0) 2531-3445

Fax

+66 (0) 3242-8351

Mueang Mai-Bang Phli Branch

Fax

+66 (0) 2531-9636

Tel.

+66 (0) 2706-0322-6

Fax

+66 (0) 2706-0329

Nam Daeng Branch

Tel.

+66 (0) 3482-7086,

Tel.

+66 (0) 2385-2511-2,

+66 (0) 3482-7093

Rangsit Branch

+66 (0) 2385-2920

Fax

+66 (0) 3482-7094

Tel.

+66 (0) 2567-1117,

Fax

+66 (0) 2385-2921

+66 (0) 2567-5586

Fax

+66 (0) 2567-6694

Ha Yaek Pak Kret Branch

Tel.

+66 (0) 3243-4130-1,

Tel.

+66 (0) 2583-7574,

+66 (0) 3247-1158

Rangsit-Khlong 3 Branch

+66 (0) 2583-9144

Fax

+66 (0) 3247-1185

Tel.

+66 (0) 2990-8806-8

Fax

+66 (0) 2584-3959

Fax

+66 (0) 2533-1659

Khao Wang Branch

Khlong Khru Branch

Cha-am Branch

Dan Chang Branch

Imperial World Samrong Branch

Tel.

+66 (0) 3559-5497

Rattanathibet Branch

Tel.

+66 (0) 2380-2943-5,

Fax

+66 (0) 3559-5499

Tel.

+66 (0) 2969-9040-3,

+66 (0) 2756-9023

+66 (0) 2969-9046

Fax

+66 (0) 2756-9024

Damnoen Saduak Branch

Fax

+66 (0) 2969-9048

Tel.

+66 (0) 3225-3810-2

Homework Ratchaphruek Branch

Fax

+66 (0) 3225-3813

Paolo Memorial Hospital

Tel.

+66 (0) 2447-6690-92

Samut Prakan Branch

Fax

+66 (0) 2447-6693

Talat Chao Prom Branch

Tel.

+66 (0) 2182-7239-41,

Tel.

+66 (0) 3524-4768,

+66 (0) 2182-7242

CENTRAL REGION

+66 (0) 3524-5162-3

Fax

+66 (0) 2182-7243

Fax

+66 (0) 3524-5441

Kabin Buri Branch

Lam Luk Ka Branch

Tel.

+66 (0) 3728-1156,

Talat Tha Na (Nakhon Chai Si) Branch

Tel.

+66 (0) 2994-5747-51

+66 (0) 3728-1333

Tel.

+66 (0) 3433-1107-9

Fax

+66 (0) 2994-5753

Fax

+66 (0) 3728-1155

Fax

+66 (0) 3433-1151

Samut Prakan Branch

Krathum Baen Branch

Talat Mahachai Branch

Tel.

+66 (0) 2388-0099,

Tel.

+66 (0) 3447-2422,

Tel.

+66 (0) 3481-0287-8

+66 (0) 2395-0045

+66 (0) 3447-2651-2

Fax

+66 (0) 3481-0467

Fax

+66 (0) 2395-2021

Fax

+66 (0) 3447-1511

Talat Suphan Buri Branch

Bang Kadi Industrial Park Branch

Kanchanaburi Branch

Tel.

+66 (0) 3551-1330,

Tel.

+66 (0) 2501-1254-6

Tel.

+66 (0) 3451-8763,

+66 (0) 3551-1590

Fax

+66 (0) 2501-1257

+66 (0) 3462-1565-6

Fax

+66 (0) 3552-3881

Fax

+66 (0) 3451-4961

Annual Report 2011 Thanachart Bank Public Company Limited

273


Thanon Khun San (Sing Buri) Branch

Thanon Saengchuto (Kanchanaburi)

Tesco Lotus Mahachai Branch

Tel.

+66 (0) 3651-1199,

Branch

Tel.

+66 (0) 3482-6231,

+66 (0) 3652-1200-1

Tel.

+66 (0) 3451-5096-100

+66 (0) 3482-6230

Fax

+66 (0) 3652-1202

Fax

+66 (0) 3451-5102

Fax

+66 (0) 3442-1356

Thanon Sai Phra (Nakhon Pathom)

Thanon Amarin (Ratchaburi) Branch

Nakhon Chai Si Branch

Branch

Tel.

+66 (0) 3233-7142,

Tel.

+66 (0) 3433-1350-1

Tel.

+66 (0) 3425-5317-9

+66 (0) 3233-8280

Fax

+66 (0) 3433-1349

Fax

+66 (0) 3425-4915

Fax

+66 (0) 3232-5801

Nakhon Nayok Branch

Thanon Songphon Branch

Thanon Ekkachai (Samut Sakhon)

Tel.

+66 (0) 3731-1131,

Tel.

+66 (0) 3220-0427,

Branch

+66 (0) 3731-2608-9

+66 (0) 3221-1900

Tel.

+66 (0) 3441-1127,

Fax

+66 (0) 3731-2610

Fax

+66 (0) 3220-0426

+66 (0) 3441-1225-6

Fax

+66 (0) 3442-5204

Nakhon Pathom Branch

Thanon Bowon Branch

Tel.

+66 (0) 3421-9131

Tel.

+66 (0) 3451-1022,

Thavikit Plaza Mae Klong Branch

Fax

+66 (0) 3421-9160

+66 (0) 3451-2387

Tel.

+66 (0) 3472-0744,

Fax

+66 (0) 3451-1597

+66 (0) 3472-0766

Na Di Branch

Fax

+66 (0) 3471-6267

Tel.

+66 (0) 3728-9069,

Thanon Phrapanwasa Branch

+66 (0) 3741-1201-2

Tel.

+66 (0) 3552-1575,

Thong Pha Phum Branch

Fax

+66 (0) 3728-9069

+66 (0) 3552-1963

Tel.

+66 (0) 3459-9073,

Fax

+66 (0) 3552-1964

+66 (0) 3459-9352

Bang Sai Branch

Fax

+66 (0) 3459-9613

Tel.

+66 (0) 3528-2118-20,

Thanon Phahon Yothin (Saraburi)

+66 (0) 3537-5226

Branch

Tha Muang Branch

Fax

+66 (0) 3537-5144

Tel.

+66 (0) 3621-1166,

Tel.

+66 (0) 3461-1119,

+66 (0) 3621-1454

+66 (0) 3461-1403

Bang Pahan Branch

Fax

+66 (0) 3621-2421

Fax

+66 (0) 3461-2419

Tel.

+66 (0) 3538-1023-5

Fax

+66 (0) 3538-1026

Thanon Phet Kasem (Hua Hin) Branch

Tha Yang Branch

Tel.

+66 (0) 3251-6666-45,

Tel.

+66 (0) 3246-1445-6,

Bang Len Branch

+66 (0) 3251-6663

+66 (0) 3246-1823-4

Tel.

+66 (0) 3439-1026-9

Fax

+66 (0) 3253-2919

Fax

+66 (0) 3246-1447

Fax

+66 (0) 3439-1030

Thanon Ratchawithi (Nakhon Pathom)

Tha Ruea-Kanchanaburi Branch

Ban Pong Branch

Branch

Tel.

+66 (0) 3456-1130,

Tel.

+66 (0) 3220-0429-31,

Tel.

+66 (0) 3424-2348,

+66 (0) 3456-1040

+66 (0) 3221-1993

+66 (0) 3425-1080

Fax

+66 (0) 3456-2073

Fax

+66 (0) 3221-1035

Fax

+66 (0) 3425-1081

Tha Ruea-Ayutthaya Branch

Ban Phaeo Branch

Thanon Setthakit 1 (Om Noi) Branch

Tel.

+66 (0) 3534-1019,

Tel.

Tel.

+66 (0) 2810-4596-9

+66 (0) 3534-1029

+66 (0) 3448-0111-12

Fax

+66 (0) 2810-4605

Fax

+66 (0) 3534-1795

Fax

+66 (0) 3448-1606

+66 (0) 3448-1088,

Thanon Sut Banthat (Saraburi) Branch

Thung Khok Branch

Ban Mo Branch

Tel.

+66 (0) 3631-4512

Tel.

+66 (0) 3556-8086-7

Tel.

+66 (0) 3620-1141,

+66 (0) 3631-4256-7

Fax

+66 (0) 3556-8069

+66 (0) 3620-1391-2

Fax

+66 (0) 3631-5404

Fax

+66 (0) 3620-1142

Tesco Lotus Pran Buri Branch

Thanon Sura Songkhram (Lop Buri)

Tel.

+66 (0) 3254-2436-7,

Prachuap Khiri Khan Branch

Branch

+66 (0) 3254-2454

Tel.

+66 (0) 3260-4464-7

Tel.

+66 (0) 3661-8023,

Fax

+66 (0) 3282-5777

Fax

+66 (0) 3260-4468

+66 (0) 3661-8083-4

Fax

+66 (0) 3642-4846

274

Annual Report 2011 Thanachart Bank Public Company Limited


Prachin Buri Branch

Rojana Branch

Sa Kaeo Branch

Tel.

+66 (0) 3721-1300,

Tel.

+66 (0) 3521-3892-4,

Tel.

+66 (0) 3724-1061,

+66 (0) 3721-3855-9

+66 (0) 3524-4381

+66 (0) 3724-1585-6

Fax

+66 (0) 3721-3080

Fax

+66 (0) 3524-2136

Fax

+66 (0) 3724-1062

Pran Buri Branch

Robinson Ratchaburi Branch

Saraburi Branch

Tel.

+66 (0) 3262-1643,

Tel.

+66 (0) 3232-7711-3

Tel.

+66 (0) 3631-8291-4

+66 (0) 3262-2373-4

Fax

+66 (0) 3232-7714

Fax

+66 (0) 3631-6601

Fax

+66 (0) 3262-2055

Lop Buri Branch

Rojana Industrial Park Ayutthaya

Pak Phriao Branch

Tel.

+66 (0) 3622-1163,

Branch

Tel.

+66 (0) 3621-1833-4,

+66 (0) 3641-1595

Tel.

+66 (0) 3571-9710-2,

+66 (0) 3622-1286

Fax

+66 (0) 3642-1023

+66 (0) 3571-9713

Fax

+66 (0) 3622-1884

Fax

+66 (0) 3533-1651

Lat Bua Luang Branch

Phra Nakhon Si Ayutthaya Branch

Tel.

+66 (0) 3537-9290-1

Song Phi Nong Branch

Tel.

+66 (0) 3523-5611

Fax

+66 (0) 3537-9292

Tel.

+66 (0) 3553-2890-3

Fax

+66 (0) 3523-5630

Fax

+66 (0) 3553-2894

Wang Nam Yen Branch

Phra Pathom Chedi Branch

Tel.

+66 (0) 3725-1543-7

Sam Chuk Branch

Tel.

+66 (0) 3425-4203-5,

Fax

+66 (0) 3725-1546

Tel.

+66 (0) 3557-1644,

+66 (0) 3421-3541

+66 (0) 3557-1655

Fax

+66 (0) 3425-9131

Wang Sombun Branch

Fax

+66 (0) 3557-1099

Tel.

+66 (0) 3744-9193-4

Phutthamonthon Sai 4 Branch

Fax

+66 (0) 3744-9195

Sam Phran Branch

Tel.

+66 (0) 2420-0444,

Tel.

+66 (0) 3432-2781,

+66 (0) 2813-1115

Wat Thian Dat Branch

+66 (0) 3432-2783

Fax

+66 (0) 2813-1116

Tel.

+66 (0) 2429-0216,

Fax

+66 (0) 3432-2782

+66 (0) 2429-0813

Phetchaburi Branch

Fax

+66 (0) 2429-0847

Sing Buri Branch

Tel.

+66 (0) 3242-7023-5

Tel.

+66 (0) 3653-0410,

Fax

+66 (0) 3241-5455

Wiset Chai Chan Branch

+66 (0) 3653-0435

Tel.

+66 (0) 3563-2801-4

Fax

+66 (0) 3651-2021

Photharam Branch

Fax

+66 (0) 3563-2805

Tel.

+66 (0) 3223-1089,

+66 (0) 3223-1255

Si Prachan Branch

Tel.

+66 (0) 3552-5742,

Fax

+66 (0) 3223-1090

Tel.

+66 (0) 3558-1150,

+66 (0) 3550-1237

+66 (0) 3558-1160

Fax

+66 (0) 3552-5743

Pho Hak Branch

Fax

+66 (0) 3558-1140

Tel.

+66 (0) 3238-7021-2

Fax

+66 (0) 3238-7023

Salaya Branch

Tel.

+66 (0) 3520-1035,

Tel.

+66 (0) 2441-4557-9

+66 (0) 3520-1291

Mahachai Mueang Mai Branch

Fax

+66 (0) 2441-4560

Fax

+66 (0) 3520-1749

Tel.

+66 (0) 3481-2620-4

Fax

+66 (0) 3442-6989

Suphan Buri Branch

Sena Branch

Samut Songkhram Branch

Nong Khae Branch

Tel.

+66 (0) 3471-1361,

Tel.

+66 (0) 3637-1504,

Ratchaburi Branch

+66 (0) 3471-1444

+66 (0) 3637-1517

Tel.

+66 (0) 3231-1203-5

Fax

+66 (0) 3471-5555

Fax

+66 (0) 3637-1516

Fax

+66 (0) 3231-1207

Samut Sakhon Branch

Hua Hin Branch

Phetcharat Hospital (Phetchaburi)

Tel.

+66 (0) 3482-0359-60,

Tel.

+66 (0) 3251-1098,

Branch

+66 (0) 3482-0365-6

+66 (0) 3251-1203

Tel.

+66 (0) 3241-0505,

Fax

+66 (0) 3482-0445

Fax

+66 (0) 3251-2219

+66 (0) 3241-0506

Fax

+66 (0) 3240-0618

Annual Report 2011 Thanachart Bank Public Company Limited

275


Ayutthaya Branch

Chong Khae Branch

Thanon Charoen Suk

Tel.

+66 (0) 3525-2431-6,

Tel.

+66 (0) 5626-9163,

(Kamphaeng Phet) Branch

+66 (0) 3525-2359

+66 (0) 5691-2830

Tel.

+66 (0) 5571-3325-6

Fax

+66 (0) 3525-2437

Fax

+66 (0) 5626-9127

Fax

+66 (0) 5571-3368

Ayutthaya Park Branch

Chai Nat Branch

Thanon Chang Chlan (Chiang Mai)

Tel.

+66 (0) 3522-9560-1

Tel.

+66 (0) 5641-6650-3

Branch

Fax

+66 (0) 3522-9554

Fax

+66 (0) 5641-6654

Tel.

+66 (0) 5382-0538-41,

+66 (0) 5382-0542

Aranyapraphet Branch

Chang Chlan Branch

Fax

+66 (0) 5382-0543

Tel.

+66 (0) 3722-3505-7

Tel.

+66 (0) 5327-4634,

Fax

+66 (0) 3722-3511

+66 (0) 5327-4934-5

Thanon Chang Phueak (Chiang Mai)

Fax

+66 (0) 5327-4635

Branch

Om Noi Branch

Tel.

+66 (0) 5323-1060,

Tel.

+66 (0) 2420-1450,

Chiang Rai Branch

+66 (0) 5341-2116-7

+66 (0) 2420-1811

Tel.

+66 (0) 5371-7100-6,

Fax

+66 (0) 5323-1061

Fax

+66 (0) 2420-1132

+66 (0) 5371-7108-9

Fax

+66 (0) 5371-7107

Thanon Thatsana Phanit 2 (Sukhothai)

Om Yai Branch

Tel.

+66 (0) 2420-4920,

Chiang Mai Branch

Tel.

+66 (0) 5561-6201

+66 (0) 2420-4930

Tel.

+66 (0) 5327-3352,

Fax

+66 (0) 5561-6200

Fax

+66 (0) 2811-6538

+66 (0) 5327-5737

Fax

+66 (0) 5327-2733

Thanon Thipyawan (Lampang) Branch

Amphawa Branch

Tel.

+66 (0) 5422-6041-4

Tel.

+66 (0) 3475-1177-8,

Central Airport Chiang Mai Branch

Fax

+66 (0) 5422-6045

+66 (0) 3475-1640-1

Tel.

+66 (0) 5320-1234

Fax

+66 (0) 3475-1642

Fax

+66 (0) 5320-1900

Thanon Nimmanhemin Branch

Branch

Tel.

+66 (0) 5322-5483,

Ang Thong Branch

Central Plaza Chiang Rai Branch

+66 (0) 5340-0672-4

Tel.

+66 (0) 3561-1099,

Tel.

+66 (0) 5317-9928-30,

Fax

+66 (0) 5340-0675

+66 (0) 3561-2301-3

+66 (0) 5317-9931

Fax

+66 (0) 3561-1100

Fax

+66 (0) 5375-4496

Thanon Barom Trai Lokanart 2 (Phitsanulok) Branch

Kabin Buri Industrial (Nongki) Branch

Talat Varorot Branch

Tel.

+66 (0) 5521-8645-9

Tel.

+66 (0) 3745-5428-9,

Tel.

+66 (0) 5387-4018-9,

Fax

+66 (0) 5521-8648

+66 (0) 3745-5420-1

+66 (0) 5387-4020

Fax

+66 (0) 3745-5439

Fax

+66 (0) 5387-4006

Thanon Bunyawat Branch

Tel.

+66 (0) 5421-7444,

U Thong Branch

Tak Branch

+66 (0) 5421-8790

Tel.

+66 (0) 3555-1299,

Tel.

+66 (0) 5551-1275,

Fax

+66 (0) 5422-4667

+66 (0) 3555-1618

+66 (0) 5551-1360

Fax

+66 (0) 3555-1868

Fax

+66 (0) 5551-3486

Thanon Yantrakit Koson (Phrae) Branch

NORTHERN REGION

Takhli Branch

Tel.

+66 (0) 5462-6811,

Tel.

+66 (0) 5626-1093,

+66 (0) 5462-6931

Khuang Sing Branch

+66 (0) 5626-1133

Fax

+66 (0) 5453-2837

Tel.

+66 (0) 5321-0826-8,

Fax

+66 (0) 5626-2383

+66 (0) 5321-6586

Fax

+66 (0) 5322-2718

Thanon Kosi (Nakhon Sawan) Branch

Branch

Tel.

+66 (0) 5631-3929-31

Tel.

+66 (0) 5622-2998,

Bhumibol Dam Branch

Fax

+66 (0) 5631-3932

+66 (0) 5622-7835

Tel.

+66 (0) 5549-5989,

Fax

+66 (0) 5623-1462

+66 (0) 5599-0045

Thanon Chom Phon (Tak) Branch

Fax

+66 (0) 5559-9021

Tel.

+66 (0) 5554-0219,

+66 (0) 5554-1721

Fax

+66 (0) 5551-3988

Thanon Wet Suwan (Nakhon Sawan)

276

Annual Report 2011 Thanachart Bank Public Company Limited


Thanon Sueksa Charoen (Phetchabun)

Big C Phitsanulok Branch

Mae Sai Branch

Branch

Tel.

+66 (0) 5537-8295,

Tel.

+66 (0) 5373-1675,

Tel.

+66 (0) 5674-4076-8,

+66 (0) 5220-7845

+66 (0) 5373-1879

+66 (0) 5672-2414

Fax

+66 (0) 5537-8296

Fax

+66 (0) 5373-1905

Fax

+66 (0) 5672-2415

Mae Hong Son Branch

Big C Kamphaeng Phet Branch

Thanon Samran Ruen (Uttaradit)

Tel.

+66 (0) 5585-3928-30,

Tel.

+66 (0) 5361-4441-2,

Branch

+66 (0) 5585-3931

+66 (0) 5361-4444-5

Tel.

+66 (0) 5540-3103-6

Fax

+66 (0) 5585-3932

Fax

+66 (0) 5361-4443

Fax

+66 (0) 5540-3107

Pak Nam Pho Branch

McCormick Hospital (Chiang Mai)

Thanon Ekathossaros (Phitsanulok)

Tel.

+66 (0) 5621-2082,

Branch

Branch

+66 (0) 5621-2189

Tel.

+66 (0) 5326-1218-9,

Tel.

+66 (0) 5524-3871-2,

Fax

+66 (0) 5621-3516

+66 (0) 5330-0421

+66 (0) 5525-9322

Fax

+66 (0) 5326-1123

Fax

+66 (0) 5524-4268

Pai Branch

Tel.

+66 (0) 5369-9886,

Lampang Branch

Tha Phae Branch

+66 (0) 5369-9505

Tel.

+66 (0) 5431-8927-30

Tel.

+66 (0) 5323-5755

Fax

+66 (0) 5369-9252

Fax

+66 (0) 5431-6960

Fax

+66 (0) 5323-5757

Phran Kratai Branch

Lamphun Branch

Tesco Lotus Chiang Mai Hang Dong

Tel.

+66 (0) 5576-2111-2

Tel.

+66 (0) 5351-0371,

Branch

Fax

+66 (0) 5576-2113

+66 (0) 5312-0601

Tel.

+66 (0) 5380-6266-8,

Fax

+66 (0) 5351-0372

+66 (0) 5380-6269

Phayao Branch

Fax

+66 (0) 5328-1460

Tel.

+66 (0) 5443-1124,

Wang Chao Branch

+66 (0) 5448-2386-8

Tel.

+66 (0) 5555-6059,

Tesco Lotus Phitsanulok Branch

Fax

+66 (0) 5443-1272

+66 (0) 5555-6061

Tel.

+66 (0) 5537-7254,

Fax

+66 (0) 5555-6063

+66 (0) 5537-7326

Phichit Branch

Fax

+66 (0) 5537-7356

Sop Tui Branch

Tel.

+66 (0) 5661-1033,

+66 (0) 5661-1651

Tel.

+66 (0) 5422-8040-3

Nakhon Sawan Branch

Fax

+66 (0) 5661-1127

Fax

+66 (0) 5422-8044

Tel.

+66 (0) 5631-3848,

+66 (0) 5622-5444

Phitsanulok Branch

Sawankhalok Branch

Fax

+66 (0) 5631-3850

Tel.

+66 (0) 5530-4313,

Tel.

+66 (0) 5909-9009

+66 (0) 5564-2512

Nan Branch

Fax

+66 (0) 5530-4279

Fax

+66 (0) 5564-1480

Tel.

+66 (0) 5471-1095-9

Fax

+66 (0) 5471-1098

Phetchabun Branch

San Sai Branch

Tel.

+66 (0) 5672-3103

Tel.

+66 (0) 5349-1457,

Lamphun Industrial Estate Branch

Fax

+66 (0) 5672-3104

+66 (0) 5349-1934

Tel.

+66 (0) 5358-1662-3

Fax

+66 (0) 5349-1728

Fax

+66 (0) 5358-1664

Phrae Branch

Tel.

+66 (0) 5452-2004,

San Pa Khoi Branch

Bo Sang Branch

+66 (0) 5452-2006

Tel.

+66 (0) 5324-4157,

Tel.

+66 (0) 5333-7004-6

Fax

+66 (0) 5452-2005

+66 (0) 5324-9167-8

Fax

+66 (0) 5333-7007

Fax

+66 (0) 5324-1157

Phaisali Branch

Big C Chiang Mai Branch

Tel.

+66 (0) 5625-9721-2

Sukhothai Branch

Tel.

+66 (0) 5324-1248-9,

Fax

+66 (0) 5625-9723

Tel.

+66 (0) 5561-6022,

+66 (0) 5324-1336

+66 (0) 5562-2465-6

Fax

+66 (0) 5324-1337

Mae Sot Branch

Fax

+66 (0) 5562-2469

Tel.

+66 (0) 5533-3113,

+66 (0) 5553-3319

Fax

+66 (0) 5553-3320

+66 (0) 5564-1478-9,

Annual Report 2011 Thanachart Bank Public Company Limited

277


Nong Ben Branch

Khon Kaen Branch

Thanon Pho Si (Udon Thani) Branch

Tel.

+66 (0) 5629-6163-5

Tel.

+66 (0) 4332-4321,

Tel.

+66 (0) 4234-3817-8

Fax

+66 (0) 5629-6166

+66 (0) 4322-6888

Fax

+66 (0) 4234-3727

Fax

+66 (0) 4332-5919

Thanon Mittraphap Branch

Lom Kao Branch

Tel.

+66 (0) 5670-8492-3

Chaiyaphum Branch

Tel.

+66 (0) 4426-8631-6

Fax

+66 (0) 5670-8494

Tel.

+66 (0) 4481-3251-5

Fax

+66 (0) 4426-8634

Fax

+66 (0) 4481-3253

Thanon Mittraphap

Lom Sak Branch

Tel.

+66 (0) 5670-1540,

Chum Phae Branch

(Nakhon Ratchasima) Branch

+66 (0) 5670-1878

Tel.

+66 (0) 4331-1684,

Tel.

Fax

+66 (0) 5670-4513

+66 (0) 4331-2292

+66 (0) 4425-1376

Fax

+66 (0) 4331-2395

Fax

+66 (0) 4425-9002

+66 (0) 4425-9003-4,

Hankha Branch

Tel.

+66 (0) 5645-1040,

Central Plaza Khon Kaen Branch

Thanon Ruam Chai (Loei) Branch

+66 (0) 5645-1042

Tel.

+66 (0) 4328-8361-3,

Tel.

+66 (0) 4286-1451-3

Fax

+66 (0) 5645-1499

+66 (0) 4328-8364

Fax

+66 (0) 4286-1454

Fax

+66 (0) 4328-8365

Hang Dong Branch

Thanon Ratphatthana (Sakon Nakhon)

Tel.

+66 (0) 5343-4035-7

Talat Thetsaban Maha Sarakham

Branch

Fax

+66 (0) 5343-4038

Branch

Tel.

+66 (0) 4271-5767,

Tel.

+66 (0) 4372-5485,

+66 (0) 4273-6146-8

Hang Nam Sakorn Branch

+66 (0) 4372-5661

Fax

+66 (0) 4271-5686

Tel.

+66 (0) 5643-1232-3

Fax

+66 (0) 4372-3692

Fax

+66 (0) 5643-1234

Thanon Warin-Phibun

Talat Pak Chong Branch

(Warin Chamrap) Branch

Ha Yaek Phokhun Mengrai

Tel.

+66 (0) 4431-3798-9,

Tel.

+66 (0) 4532-5075,

(Chiang Rai) Branch

+66 (0) 4431-3855-6

+66 (0) 4528-6171-3

Tel.

+66 (0) 5374-5244,

Fax

+66 (0) 4431-3255

Fax

+66 (0) 4532-5076

+66 (0) 5374-5245

Fax

+66 (0) 5374-5247

Thanon Klang Mueang (Khon Kaen)

Thanon Si Chan Branch

Branch

Tel.

+66 (0) 4322-7275-8

Uttaradit Branch

Tel.

+66 (0) 4322-8266,

Fax

+66 (0) 4322-7279

Tel.

+66 (0) 5544-1777,

+66 (0) 4332-2630

+66 (0) 5544-2240

Fax

+66 (0) 4332-2386

Thanon Sappasit Branch

Fax

+66 (0) 5541-4096

Tel.

+66 (0) 4524-4315,

Thanon Kuang Heng (Si Sa Ket)

+66 (0) 4524-4729

Uthai Thani Branch

Branch

Fax

+66 (0) 4524-3193

Tel.

+66 (0) 5657-1616-9

Tel.

+66 (0) 4561-7861-4

Fax

+66 (0) 5657-1620

Fax

+66 (0) 4561-7860

Thanon Suranari Branch

Tel.

+66 (0) 4424-2560,

Happy Plaza (Phichit) Branch

Thanon Chit Bamrung (Surin) Branch

+66 (0) 4425-6705

Tel.

+66 (0) 5661-6471-3,

Tel.

+66 (0) 4453-8934-5

Fax

+66 (0) 4425-6706

+66 (0) 5661-6474

Fax

+66 (0) 4471-4051

Fax

+66 (0) 5665-0987

Thanon Na Mueang (Khon Kaen)

Thanon Thinanon (Kalasin) Branch

Branch

NORTH EASTERN REGION

Tel.

+66 (0) 4381-2024,

Tel.

+66 (0) 4322-1163,

+66 (0) 4381-2026

+66 (0) 4322-3234

Kalasin Branch

Fax

+66 (0) 4381-2066

Fax

+66 (0) 4322-1822

Tel.

+66 (0) 4382-1080-1,

+66 (0) 4382-1420

Thanon Prachak (Nong Khai) Branch

Thanon Hai Srok (Roi Et) Branch

Fax

+66 (0) 4381-6584

Tel.

+66 (0) 4241-2890-4

Tel.

+66 (0) 4352-3335-7

Fax

+66 (0) 4241-2895

Fax

+66 (0) 4352-3339

278

Annual Report 2011 Thanachart Bank Public Company Limited


Thanon Aphiban Bancha

Pak Chong Branch

Surin Branch

(Nakhon Phanom) Branch

Tel.

+66 (0) 4431-6866-9

Tel.

+66 (0) 4451-4455-8

Tel.

+66 (0) 4251-4500

Fax

+66 (0) 4431-6859

Fax

+66 (0) 4451-4459

Fax

+66 (0) 4251-4501

Surin Plaza Branch

Phlapphla Chai (Buri Ram) Branch

Thanon Udon Dutsadi Branch

Tel.

+66 (0) 4460-8012-5

Tel.

+66 (0) 4453-8517-20

Tel.

+66 (0) 4224-7574,

Fax

+66 (0) 4460-8016

Fax

+66 (0) 4453-8521

+66 (0) 4224-7732

Fax

+66 (0) 4224-7510

Maha Sarakham Branch

Suwannakhuha Branch

Tel.

+66 (0) 4374-0681-3,

Tel.

+66 (0) 4237-2515-6

Tesco Lotus Khorat Branch

+66 (0) 4374-0684

Fax

+66 (0) 4237-2517

Tel.

+66 (0) 4426-3564,

Fax

+66 (0) 4372-2958

+66 (0) 4426-3567

Fax

+66 (0) 4426-3565

Mukdahan Branch

Tel.

+66 (0) 4246-0119-22

Tel.

+66 (0) 4263-1367-70

Fax

+66 (0) 4246-0199

Tesco Lotus Chaiyaphum Branch

Fax

+66 (0) 4263-1374

Tel.

+66 (0) 4483-8324-6,

+66 (0) 4483-8327

Yasothon Branch

Tel.

+66 (0) 4231-1107,

Fax

+66 (0) 4481-3352

Tel.

+66 (0) 4571-4051-6

+66 (0) 4231-1166

Fax

+66 (0) 4571-4054

Fax

+66 (0) 4231-1657

Nakhon Phanom Branch

Tel.

+66 (0) 4251-6125-8

Roi Et Branch

Ha Yaek Nampu (Udon Thani) Branch

Fax

+66 (0) 4251-6129

Tel.

+66 (0) 4351-1521,

Tel.

+66 (0) 4222-1703,

+66 (0) 4351-3520-1

+66 (0) 4222-1381

Nakhon Ratchasima Branch

Fax

+66 (0) 4351-1520

Fax

+66 (0) 4224-7209

Tel.

+66 (0) 4426-9797,

+66 (0) 4426-8336-8

Loei Branch

Thao Suranari Monument Branch

Fax

+66 (0) 4426-9790

Tel.

+66 (0) 4283-0851-3,

Tel.

+66 (0) 4424-1774,

+66 (0) 4283-0854

+66 (0) 4424-1775

Nang Rong Branch

Fax

+66 (0) 4281-4472

Fax

+66 (0) 4424-1776

Tel.

+66 (0) 4463-1049,

+66 (0) 4463-1586-8

Wang Sam Mo Branch

Amnat Charoen Branch

Fax

+66 (0) 4463-1050

Tel.

+66 (0) 4238-7486-7

Tel.

+66 (0) 4551-1721-4

Fax

+66 (0) 4238-7488

Fax

+66 (0) 4551-1726

Ban Phai Branch

Tel.

+66 (0) 4327-4038-40

Warin Chamrap Branch

Udon Thani Branch

Fax

+66 (0) 4327-4043

Tel.

+66 (0) 4532-2788,

Tel.

+66 (0) 4234-2550

+66 (0) 4532-2791-3

Fax

+66 (0) 4234-2398

Big C Udon Thani Branch

Fax

+66 (0) 4532-2790

Tel.

+66 (0) 4212-8551-3

Fax

+66 (0) 4212-8548

Si Sa Ket Branch

Tel.

Tel.

+66 (0) 4562-0500-2,

+66 (0) 4531-9404

Big C Buri Ram Branch

+66 (0) 4562-0503

Fax

+66 (0) 4531-9405

Tel.

+66 (0) 4469-0450,

Fax

+66 (0) 4564-4197

+66 (0) 4469-0468

Fax

+66 (0) 4469-0469

Sakon Nakhon Branch

Tel.

+66 (0) 4271-6446-50

Ko Chang Branch

Big C Yasothon Branch

Fax

+66 (0) 4271-6451

Tel.

+66 (0) 3955-1026-9

Tel.

+66 (0) 4572-4361,

Fax

+66 (0) 3955-1030

+66 (0) 4572-4437

Sang Khom Branch

Fax

+66 (0) 4572-5067

Nong Khai Branch

Nong Bua Lam Phu Branch

Ubon Ratchathani Branch +66 (0) 4531-9401-3,

EASTERN REGION

Tel.

+66 (0) 4227-6222-4

Klaeng Branch

Fax

+66 (0) 4227-6225

Tel.

+66 (0) 3888-7003-9

Buri Ram Branch

Fax

+66 (0) 3867-8002

Tel.

+66 (0) 4460-1555,

Sam Yaek Pak Thong Chai Branch

+66 (0) 4460-2000

Tel.

+66 (0) 4421-3993-5,

Fax

+66 (0) 4460-2123

+66 (0) 4428-1815-6

Fax

+66 (0) 4421-3994

Annual Report 2011 Thanachart Bank Public Company Limited

279


Chanthaburi Branch

Thanon Maha Chakkaphat

Big C Chachoengsao 2 Branch

Tel.

+66 (0) 3934-4323-6

(Chachoengsao) Branch

Tel.

+66 (0) 3851-5188,

Fax

+66 (0) 3934-4327

Tel.

+66 (0) 3881-2856-7,

+66 (0) 3851-5190

+66 (0) 3853-5336

Fax

+66 (0) 3851-5219

Chachoengsao Branch

Fax

+66 (0) 3881-2874

Tel.

+66 (0) 3851-5835-7

Fax

+66 (0) 3851-5838

Thanon Sukhumwit (Chon Buri)

Tel.

+66 (0) 3878-3032-4,

Branch

+66 (0) 3878-3035

Chon Buri Branch

Tel.

+66 (0) 3879-6066,

Fax

+66 (0) 3838-7923

Tel.

+66 (0) 3827-6930-7

+66 (0) 3879-5639

Fax

+66 (0) 3827-6935

Fax

+66 (0) 3827-7841

Big C Chon Buri 2 Branch

Big C Pattaya Tai Branch

Tel.

+66 (0) 3837-4270,

Central Chon Buri Branch

Thanon Sukhumwit (Rayong) Branch

+66 (0) 3837-4273

Tel.

+66 (0) 3805-3531-3,

Tel.

+66 (0) 3861-4913-4

Fax

+66 (0) 3837-4463

+66 (0) 3805-3534

Fax

+66 (0) 3861-2342

Fax

+66 (0) 3805-3535

Big C Rayong Branch

Thanon Sukhumwit (Si Racha) Branch

Tel.

+66 (0) 3887-3094,

Central Center Pattaya Branch

Tel.

+66 (0) 3877-3415-20

+66 (0) 3887-3323

Tel.

+66 (0) 3841-4852-4,

Fax

+66 (0) 3877-3421

Fax

+66 (0) 3862-2659

+66 (0) 3841-4855

Fax

+66 (0) 3841-4846

Thanon Surasak (Si Racha) Branch

Big C Sa Kaeo Branch

Tel.

+66 (0) 3831-1872-3,

Tel.

Central Festival Pattaya Beach Branch

+66 (0) 3831-2206-7

+66 (0) 3742-1764

Tel.

+66 (0) 3300-3571-3,

Fax

+66 (0) 3831-1871

Fax

+66 (0) 3742-1765

+66 (0) 3804-3193

Fax

+66 (0) 3804-3194

Tesco Lotus Pattaya Nuea Branch

Pluak Daeng Branch

Tel.

+66 (0) 3841-1410,

Tel.

+66 (0) 3865-9768-9

Trat Branch

+66 (0) 3841-1316

Fax

+66 (0) 3865-9770

Tel.

+66 (0) 3953-1641-3,

Fax

+66 (0) 3841-1423

+66 (0) 3953-1645

Fax

+66 (0) 3952-2662

Na Kluea (Pattaya) Branch

Tel.

Tel.

+66 (0) 3822-6060-1

+66 (0) 3831-3236

Tukcom Pattaya Branch

Fax

+66 (0) 3822-6117

Fax

+66 (0) 3831-3245

Tel.

+66 (0) 3872-4105-7

Fax

+66 (0) 3872-4108

Nikhom Phatthana Branch

+66 (0) 3742-1761-3,

Pacific Park (Si Racha) Branch +66 (0) 3831-3226,

Pranom Sarakham Branch

Tel.

+66 (0) 3863-6090-1

Tel.

+66 (0) 3855-1005,

Thanon Khwang (Chanthaburi) Branch

Fax

+66 (0) 3863-6092

+66 (0) 3855-1824-6

Tel.

+66 (0) 3932-5925,

Fax

+66 (0) 3855-1659

+66 (0) 3932-2048

Bo Win Industrial Estate Branch

Fax

+66 (0) 3932-5926

Tel.

+66 (0) 3834-5456-7,

Pattaya Branch

+66 (0) 3834-5828

Tel.

+66 (0) 3872-0334,

Thanon Chetchamnong (Chon Buri)

Fax

+66 (0) 3834-5829

+66 (0) 3872-0339

Branch

Fax

+66 (0) 3842-9973

Tel.

+66 (0) 3879-2203-5

Bang Pla Soi Branch

Fax

+66 (0) 3879-2178

Tel.

+66 (0) 3827-1819,

Pattaya Klang Branch

+66 (0) 3827-6651

Tel.

+66 (0) 3842-6312,

Thanon Tat Mai (Trat) Branch

Fax

+66 (0) 3827-6652

+66 (0) 3842-6343

Tel.

+66 (0) 3952-5731-5

Fax

+66 (0) 3842-1325

Fax

+66 (0) 3952-5734

Ban Bueng Branch

Tel.

+66 (0) 3844-3060-1,

Pattaya Nuea Branch

Thanon Phraya Satcha (Chon Buri)

+66 (0) 3844-4015-6

Tel.

+66 (0) 3842-8901-2,

Branch

Fax

+66 (0) 3844-3713

+66 (0) 3842-8962

Tel.

+66 (0) 3879-2214-5,

Fax

+66 (0) 3842-8963

+66 (0) 3879-2217

Ban Phe Branch

Fax

+66 (0) 3879-2216

Tel.

+66 (0) 3865-1995,

+66 (0) 3865-1997

Fax

+66 (0) 3865-1993

280

Annual Report 2011 Thanachart Bank Public Company Limited


Rajamanggala University of

Laem Chabang Branch

Central Festival Phuket Branch

Technology Tawan-ok Branch

Tel.

+66 (0) 3840-0740-3

Tel.

+66 (0) 7620-9290,

Tel.

+66 (0) 3834-1029

Fax

+66 (0) 3840-0745

+66 (0) 7620-9292

Fax

+66 (0) 3834-1159

Fax

+66 (0) 7620-9291

Laem Thong Rayong Branch

Burapha University Branch

Tel.

+66 (0) 3802-3405-7,

Diana Si Phuwanart Branch

Tel.

+66 (0) 3839-4185-6

+66 (0) 3802-3408

Tel.

+66 (0) 7446-5316-8

Fax

+66 (0) 3839-4187

Fax

+66 (0) 3802-3409

Fax

+66 (0) 7446-5319

Map Ta Phut Branch

SOUTHERN REGION

Trang Branch

Tel.

+66 (0) 3868-2531-3

Tel.

+66 (0) 7522-3240-3

Fax

+66 (0) 3868-1995

Krabi Branch

Fax

+66 (0) 7522-3244

Tel.

+66 (0) 7563-2838-41

Rayong Branch

Fax

+66 (0) 7563-2835

Talat Tha Phae

Tel.

+66 (0) 3892-8600,

+66 (0) 3886-4123

Kantang Branch

Tel.

+66 (0) 7538-3271,

Fax

+66 (0) 3886-4115

Tel.

+66 (0) 7525-1250,

+66 (0) 7538-3277

+66 (0) 7525-1640

Fax

+66 (0) 7538-3110

Si Racha Branch

Fax

+66 (0) 7525-1644

Tel.

+66 (0) 3877-1686-9,

+66 (0) 3877-1663

Ko Tao Branch

Tel.

+66 (0) 7561-1320-1,

Fax

+66 (0) 3877-1690

Tel.

+66 (0) 7745-6533-4

+66 (0) 7562-0520

Fax

+66 (0) 7745-6784

Fax

+66 (0) 7562-0549

Saha Pathana Industrial Park

(Si Racha) Branch

Ko Pha-ngan Branch

Takua Pa Branch

Tel.

+66 (0) 3848-1826-8

Tel.

+66 (0) 7737-7051,

Tel.

+66 (0) 7642-5176,

Fax

+66 (0) 3848-1829

+66 (0) 7737-7054

+66 (0) 7643-1503-5

Fax

+66 (0) 7737-7052

Fax

+66 (0) 7642-5177

Sattahip Branch

Tel.

+66 (0) 3843-7321,

Ko Lanta Branch

Thanon Chuti Uthit (Hat Yai) Branch

+66 (0) 3843-7986

Tel.

+66 (0) 7566-8152

Tel.

+66 (0) 7434-6396-8

Fax

+66 (0) 3843-7717

Fax

+66 (0) 7566-8151

Fax

+66 (0) 7434-6393

(Nakhon Si Thammarat) Branch

Talat Maha Rat (Krabi) Branch

Sam Yaek Klaeng Branch

Ko Samui Branch

Thanon Chon Kasem (Surat Thani)

Tel.

+66 (0) 3888-4503-5

Tel.

+66 (0) 7742-1110,

Branch

Fax

+66 (0) 3888-4506

+66 (0) 7742-0363

Tel.

+66 (0) 7728-3627-30

Fax

+66 (0) 7742-1112

Fax

+66 (0) 7728-4080

Nong Mon Branch

Tel.

+66 (0) 3839-2302,

Khao Lak Branch

Thanon Thawi Wong (Hat Patong)

+66 (0) 3839-2125

Tel.

+66 (0) 7648-5493-4

Branch

Fax

+66 (0) 3839-2501

Fax

+66 (0) 7648-5560

Tel.

+66 (0) 7629-2116-8

Fax

+66 (0) 7634-5687

Nong Mon (Chon Buri) Branch

Khian Sa Branch

Tel.

+66 (0) 3874-5233,

Tel.

+66 (0) 7738-7407-8

Thanon Thammanun Withi (Hat Yai)

+66 (0) 3874-5239

Fax

+66 (0) 7738-7409

Branch

Fax

+66 (0) 3874-6349

Tel.

+66 (0) 7423-5549,

Khok Kloi (Phang Nga) Branch

+66 (0) 7423-9907

Huai Sathon Branch

Tel.

+66 (0) 7643-4821-4

Fax

+66 (0) 7424-3648

Tel.

+66 (0) 3939-5381-3

Fax

+66 (0) 7643-4827

Fax

+66 (0) 3939-5384

Thanon Niphat Uthit 1 Branch

Chumphon Branch

Tel.

+66 (0) 7424-4898-9

Hat Pattaya (Nuea) Branch

Tel.

+66 (0) 7757-1935,

Fax

+66 (0) 7423-2485

Tel.

+66 (0) 3841-5772-4,

+66 (0) 7757-1938-9

+66 (0) 3841-5884

Fax

+66 (0) 7757-1940

Fax

+66 (0) 3841-5885

Annual Report 2011 Thanachart Bank Public Company Limited

281


Thanon Montri Branch

Tha Ruea Bang Rak (Ko Samui)

Narathiwat Branch

Tel.

+66 (0) 7621-2993,

Branch

Tel.

+66 (0) 7351-2013,

+66 (0) 7621-2999

Tel.

+66 (0) 7741-7184

+66 (0) 7351-1030

Fax

+66 (0) 7621-3149

Fax

+66 (0) 7741-7185

Fax

+66 (0) 7351-2014

Thanon Ratthakan (Hat Yai) Branch

Tha Wang (Nakhon Si Thammarat)

Ban Don Branch

Tel.

+66 (0) 7434-9070-2,

Branch

Tel.

+66 (0) 7721-0365,

+66 (0) 7426-1751

Tel.

+66 (0) 7531-3144-6,

+66 (0) 7727-2006

Fax

+66 (0) 7426-1752

+66 (0) 7535-7066

Fax

+66 (0) 7721-0366

Fax

+66 (0) 7535-7067

Ban Na Doem Branch

Thanon Ratsada (Phuket) Branch

Tel.

+66 (0) 7621-9664,

Thung Song Branch

Tel.

+66 (0) 7735-9013,

+66 (0) 7625-6873-5

Tel.

+66 (0) 7541-1087,

+66 (0) 7735-9015

Fax

+66 (0) 7621-9731

+66 (0) 7541-1287

Fax

+66 (0) 7735-9014

Fax

+66 (0) 7541-1054

Thanon Ratchadamnoen

(Nakhon Si Thammarat) Branch

Tesco Lotus Krabi Branch

Tel.

+66 (0) 7570-1020-22

Tel.

+66 (0) 7534-2779-80,

Tel.

+66 (0) 7565-0833,

Fax

+66 (0) 7570-1023

+66 (0) 7535-6119

+66 (0) 7565-0836-7

Fax

+66 (0) 7535-6741

Fax

+66 (0) 7565-0834

Big C Pattani Branch

Big C Krabi Branch

Tel.

+66 (0) 7333-8004,

Thanon Ramet (Phatthalung) Branch

Tesco Lotus Chao Fa (Phuket) Branch

+66 (0) 7331-3982-3

Tel.

+66 (0) 7462-6952-4,

Tel.

+66 (0) 7626-8059-61,

Fax

+66 (0) 7333-8005

+66 (0) 7462-6955

+66 (0) 7621-9247

Fax

+66 (0) 7461-5451

Fax

+66 (0) 7621-9248

Big C Hat Yai 2 Branch

Tel.

+66 (0) 7446-9235-7,

Thanon Si Wichai (Surat Thani)

Tesco Lotus Choeng Thale (Phuket)

+66 (0) 7446-9238

Branch

Branch

Fax

+66 (0) 7455-5609

Tel.

+66 (0) 7720-6488,

Tel.

+66 (0) 7632-5919-21,

+66 (0) 7726-4170

+66 (0) 7632-5922

Betong Branch

Fax

+66 (0) 7720-6671

Fax

+66 (0) 7627-0572

Tel.

+66 (0) 7323-1120,

+66 (0) 7323-1416

Thanon Sala Daeng (Chumphon)

Tesco Lotus Thung Song Branch

Fax

+66 (0) 7323-0914

Branch

Tel.

+66 (0) 7541-3003-5,

Tel.

+66 (0) 7750-5051-2

+66 (0) 7541-3006

Pattani Branch

Fax

+66 (0) 7750-5054

Fax

+66 (0) 7541-3007

Tel.

+66 (0) 7333-5950-1,

+66 (0) 7333-1851 +66 (0) 7333-5949

Thanon Sai Buri (Songkhla) Branch

Tesco Lotus Phuket Branch

Fax

Tel.

+66 (0) 7431-1638,

Tel.

+66 (0) 7625-5472-4,

+66 (0) 7432-3735-6

+66 (0) 7625-5475

Pak Phanang Branch

Fax

+66 (0) 7431-3543

Fax

+66 (0) 7652-3400

Tel.

+66 (0) 7551-7132,

+66 (0) 7551-7298

Thalang Branch

Tesco Lotus Ranong Branch

Fax

+66 (0) 7551-8021

Tel.

+66 (0) 7631-1020,

Tel.

+66 (0) 7782-6636-8,

+66 (0) 7631-1040

+66 (0) 7782-6639

Patong Branch

Fax

+66 (0) 7631-1433

Fax

+66 (0) 7782-6640

Tel.

+66 (0) 7629-0585-7

Fax

+66 (0) 7629-0588

Thap Thiang (Trang) Branch

Tesco Lotus Lamai (Ko Samui) Branch

Tel.

+66 (0) 7521-8059,

Tel.

+66 (0) 7741-8464,

Phra Phrom Branch

+66 (0) 7421-8590

+66 (0) 7741-8719

Tel.

+66 (0) 7576-3260-1

Fax

+66 (0) 7521-1320

Fax

+66 (0) 7741-8720

Fax

+66 (0) 7576-3262

Thai Mueang Branch

Nakhon Si Thammarat Branch

Phang-nga Branch

Tel.

+66 (0) 7657-1234-7

Tel.

+66 (0) 7532-2689-90

Tel.

+66 (0) 7641-1295,

Fax

+66 (0) 7657-1215

Fax

+66 (0) 7532-2144

+66 (0) 7641-1527-8

Fax

+66 (0) 7641-1326

282

Annual Report 2011 Thanachart Bank Public Company Limited


Huai Yot Branch

Phatthalung Branch

Lee Gardens Plaza Branch

Tel.

+66 (0) 7461-3082,

Tel.

+66 (0) 7423-9010,

Tel.

+66 (0) 7523-5033-5,

+66 (0) 7461-3951-2

+66 (0) 7423-9349

+66 (0) 7527-1013

Fax

+66 (0) 7461-1918

Fax

+66 (0) 7423-0414

Fax

+66 (0) 7527-1064

Phunphin Branch

Songkhla Branch

Hat Karon Branch

Tel.

+66 (0) 7731-1449,

Tel.

+66 (0) 7444-1198-9,

Tel.

+66 (0) 7639-6981,

+66 (0) 7731-1377

+66 (0) 7444-1232

+66 (0) 7639-6485-6

Fax

+66 (0) 7731-1537

Fax

+66 (0) 7444-1233

Fax

+66 (0) 7639-6980

Phuket Branch

Satun Branch

Hat Chaweng Branch

Tel.

+66 (0) 7626-1570-5

Tel.

+66 (0) 7472-5251-3

Tel.

Fax

+66 (0) 7626-1576

Fax

+66 (0) 7472-5254

+66 (0) 7723-1089-90

Fax

+66 (0) 7742-2051

+66 (0) 7723-0405,

Mae Nam Branch

Sam Kong (Phuket) Branch

Tel.

+66 (0) 7724-8375,

Tel.

+66 (0) 7621-2077,

Hat Rin Branch

+66 (0) 7733-2259

+66 (0) 7622-2838-40

Tel.

+66 (0) 7737-5254,

Fax

+66 (0) 7733-2260

Fax

+66 (0) 7622-2841

+66 (0) 7737-5477 +66 (0) 7737-5476

Fax

Yala Branch

Sai Buri Branch

Tel.

+66 (0) 7321-2592,

Tel.

+66 (0) 7341-1021,

Hat Lamai Branch

+66 (0) 7321-3375

+66 (0) 7341-1314-5

Tel.

+66 (0) 7745-8159-60,

Fax

+66 (0) 7321-1691

Fax

+66 (0) 7341-1138

+66 (0) 7745-8162-4 +66 (0) 7745-8161

Fax

Yan Ta Khao Branch

Surat Thani Branch

Tel.

+66 (0) 7528-1003,

Tel.

+66 (0) 7721-4581-7

Hat Yai Branch

+66 (0) 7528-1101

Fax

+66 (0) 7721-3560

Tel.

+66 (0) 7435-4690

Fax

+66 (0) 7528-1102

Fax

+66 (0) 7435-4696

Su-ngai Kolok Branch

Ranong Branch

Tel.

+66 (0) 7361-1359,

Hat Yai Nai Branch

Tel.

+66 (0) 7781-1198,

+66 (0) 7361-1002

Tel.

+66 (0) 7781-1299

Fax

+66 (0) 7361-3632

+66 (0) 7436-1316

Fax

+66 (0) 7781-1751

Fax

+66 (0) 7425-9704

+66 (0) 7436-1313-5,

Na Thon (Ko Samui) Branch

Robinson Trang Branch

Tel.

+66 (0) 7723-6612-3,

Ha Yaek Chalong (Phuket) Branch

Tel.

+66 (0) 7559-0018-9,

+66 (0) 7723-6661-4

Tel.

+66 (0) 7559-0120

Fax

+66 (0) 7723-6611

+66 (0) 7638-3431

Fax

+66 (0) 7522-6157

Fax

+66 (0) 7638-3348

+66 (0) 7638-3222,

Lang Suan Branch

Robinson Ocean

Tel.

+66 (0) 7754-1965,

Ao Nang Branch

(Nakhon Si Thammarat) Branch

+66 (0) 7754-1975

Tel.

+66 (0) 7566-1434,

Tel.

+66 (0) 7534-1875,

Fax

+66 (0) 7754-1987

+66 (0) 7566-1430-2

+66 (0) 7534-1960-1

Fax

+66 (0) 7566-1433

Fax

+66 (0) 7534-1876

Ao Luek Branch Tel.

+66 (0) 7561-0739,

+66 (0) 7563-4335-7

Fax

+66 (0) 7561-0755

Annual Report 2011 Thanachart Bank Public Company Limited

283


Summary of Specified Items per form 56-2 in 2011 Annual Report Items

Page

1. General Information

1.1 Company

1.2 Juristic companies in which the proportion of shares held is 10% or greater

1.3 Other references

259 255 - 259 260

2. Financial highlights

2 - 3

3. Nature of business operations

3.1 Nature of business operations of the Company and subsidiary

31 - 34

and Policy on division of work among member companies of Thanachart Group

3.2 Income structure

34 - 36

3.3 Key changes of business operations

36 - 50

4. Risk factors

51 - 62

5. Shareholders structure and management

5.1 Shareholders

5.2 Management

261

5.2.1 Management structure

5.2.2 Selection and appointment of members of various committees

230 - 231

5.2.3 Remuneration for the Board of Directors and Management

231 - 233

5.2.4 Corporate governance

216 - 230

5.2.5 Rules of proper use of insider information

5.2.6 Internal control and auditing systems

5.3 Dividend policy

235

218 70 - 71 262

6. Related party transactions

215

7. Management discussion and analysis

20 - 30

8. Financial statements

8.1 Financial statements and Notes to financial statements

8.2 Auditor fee

284

Annual Report 2011 Thanachart Bank Public Company Limited

73 -214 215

TBANK: Annual Report 2011  

Thanachart Bank