THANI Oppday Q3/2013

THANI PresentationOPP DAY

5 November 2013

2

1

Contents

2013 Strategies & Directions

3

3Q13 THANI’s Performance

Appendix

2013Strategies & Directions

6 Strategic Goals for 2013

1To best satisfy our customers with the best service and total financial solution to meet their unique needs

To increase our productivity and customer satisfaction through strategic investments in our people, leadership, systems and processes

To be the market leader in truck hire purchase business by gaining share in used truck and new truck segments

To grow the hire purchase customer base with new branches upcountry to support growth

To expand into other high-yield loan markets (taxi, big bike)

To restructure financing debt to reduce financial cost and boost competitive edge

2

3

4

5

6

Source: Company data

4

Key Principles to Support Goals

Key Underlying Strategies

Focus on specifically

targeted customers / segments

Improve and implement

THANI business processes

Enhance human resources

effectiveness

(Management and Staff)

Success of 6 Strategic Goals

Optimization Initiatives

2013 Business Directions

• Generate interest income from core segments (new truck and used truck) and other high-yield loan markets (Taxi, Big bike, Hi-end car)

InterestIncome

InterestExpenses

Capital

Directions Action Plans

• Open new branches in major provinces to support growth

• Speed up commission payment to Dealers

and Sales Representatives

• More promotion activities with Dealers

• Keep close relationship with customers and dealers (Thank you party etc.)

• Participate in promotion campaigns with

TBANK

• Use TBANK customers base to expand our customer base

• Decrease financial cost ratio• Refinance high interest rate borrowings

• Obtain low-cost funds from financial institution via the company financial structure and liquidity risk management

• Better fixed-cost management by minimizing operational redundancy

• Maintain Debt to Equity ratio of THANI not over 10 times

• Accumulate retained earning

• Use stock dividend policy to retain cash to support growth

• When DE Ratio over 8 times use leverage management plan

Operating Expenses

• Control cost

6

ProvisionExpenses

• Maintain NPL and coverage ratio at the industry average

• Closely monitor loans

• Focus on loan quality

• Use stringent lending policy

9M13 THANI’s Performance

13,250

14,723

16,810

18,659

21,212

23,470

25,516

239

251

197

409

318

464

362

160

169

179

207

202

219

236

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

Leasing

Other

Hire Purchase

Assets

9

Hire Purchase Breakdown (MB)

Assets (MB) Hire Purchase Breakdown (30 SEP 13) (Percent)

• 3Q13 assets increased from continuous truck loan expansion

• 3Q13 loans increased by 36.50% from 4Q12

• Truck loans continued increasing by 47.69% from 4Q12 with amount 6,139MB* of new lending in 9M13

• In 9M13, we will diversify to Taxi and Bike bike with high yield loan

Key Highlights

Remark: Hire purchase break down is amount before provisionSource: Company data, 3Q13 is unreviewed

7,953 8,957 11,101

12,872 15,146

17,157 19,011

4,607 4,789

4,536

4,343

4,262

4,148

4,159

433

621

676

820

1,041

1,259

1,341

370

476

602

714

843

973

1,105

127

152

168

193

226

269

304

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

Other

Big bike

Taxi

Used Car

Truck

Truck73.34%

Used Car16.05%

Taxi5.17%

Big bike4.26%

Other1.17%

Liabilities

10

Liabilities (MB)

Source: Company data, 3Q13 is unreviewed

• 3Q13 borrowings increased by 6,195 MB or 38.14% from 4Q12. This was due to support loans growth

• 3Q13 long term and short term proportion of borrowing as 61.91% and 38.09% respectively

• 3Q13 Fixed interest rate proportion as 98.64% matching with fixed rate from loan yield

Key Highlights

Borrowings Breakdown (MB)

Long Term & Short Term (Percent) (30 SEP 13)

Fixed Rate & Float Rate (Percent) (30 SEP 13)

Float Rate 1.36%

Fixed Rate 98.64%

11,208 12,715

14,453 16,241

18,303 20,578

22,436 233

236

387

524

720

709

600

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

Other

Borrowing

25 40 - - - - -

3,777 4,329 6,219 6,007

8,091 7,394 8,545 250

7,008

6,984

9,955

9,931 12,903

13,639

7,156

1,338

1,250

280

280

280

252

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

Long Term Borrowing -Float Rate

Long Term Borrowing -Fixed Rate

Short term Borrowing -Fixed Rate

Short term Borrowing -Float Rate

11,208 12,715 14,453 16,242 18,582 20,577 22,436

Short Term 38.09%

Long Term 61.91%

11

Profitability & Total Income

Net Profit (MB)

• 3Q13 net profit amounted to 212 MB, an increase of 58 MB or 37.83% QoQ

• The increase in 3Q13 net profit was mainly due to the continuous truck loan expansion

• ROAA and ROAE in 3Q13 stayed at 3.37% and 28.29% respectively

ProfitabilityROAA and ROAE* (Percent)

Total Income (MB)


Total Income

87 90

154 159

199 198212

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

16.28% 16.40%

26.90%25.93%

31.00%28.52% 28.29%

2.71% 2.51%

3.77%3.45%

3.94%3.47% 3.35%

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

ROE ROA

283 317365

411456

510557

4450

5656

68

68

75

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

OtherIncome

InterestIncome

328 367 421 467 524 578 632

12

Interest Income & Expenses

Interest Income (MB)

Interest Expenses (MB)

Yield, Cost of Fund, and Spread (Percent)


• Interest income has been increasing from an expansion of loans, especially the truck hire purchase loans

• 3Q13 spread increased QoQ from effective cost management

Highlights

283317

365411

456510

557

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

150167 170

186 192215

242

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

2.93% 3.04% 3.68% 3.98% 4.15% 4.29% 4.19%

5.65% 5.60% 5.02% 4.86% 4.47% 4.43% 4.47%

8.58% 8.65% 8.70% 8.84% 8.62% 8.72% 8.66%

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

Spread Cost of Fund Yield

13

Operating Expenses

Operating Expenses (MB)

• 3Q13 operating expenses slightly decreased by 5 MB or 9.34% QoQ. This was mainly because of the better operating cost management

• 3Q13 cost to income ratio decreased to 14.26%

Highlights


Cost to Income Ratio* (Percent)

46 45

61 5951

58 56

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

25.78%

22.26%

24.43%

21.13%

15.40% 15.90%

14.26%

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

14

Provision Expenses

• Normal provision in 3Q13 was higher than 2Q13 mainly due to the low season in loan collection (Deduct general reserve 12 MB recording in 3Q13)

• 3Q13 credit cost was at 1.11%, an increase from 0.72% in 2Q13

Highlights


Provision expenses (MB) Credit Cost (Percent)

15

41

5

19

3442

71

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

0.47%

1.12%

0.13%

0.41%

0.64%0.72%

1.11%

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

15

NPLs and Reserve

NPL (MB) NPL Ratio and Coverage Ratio (Percent)

• NPL ratio was at 2.58%, an increase from 2.30% at the end of 4Q12

• The increase in NPLs was mainly due to low season in loan collection

Highlights


Total Loans (MB)

445 483 445 438481

553

671

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

13,41014,891

16,98818,866

21,41323,689

25,752

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

3.28% 3.21% 2.59% 2.30% 2.23% 2.32% 2.58%

69.36% 70.61%76.66% 80.46% 77.94%

72.96% 70.28%

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

NPL Ratio Coverage Ratio

16

Debt & Equity

Debt & Equity (MB) Debt to Equtiy Ratio


If 4Q13 new loans is in our target, Debt to Equity ratio of 2013 would be 7.58%

11,44012,951

14,84016,766

19,02221,287

23,0362,209

2,192

2,345

2,509

2,709

2,867

3,079

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

5.18

5.91 6.33

6.68 7.02

7.43 7.48

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

17

Comparison to Targets


Performance Parameters 2012A 2013F** 9M13A

Profitability

ROE 21.67% N/A 29.22%

ROA 3.10% N/A 3.57%

Spread 3.72% 4.48% 4.23%

Cost to Income Ratio 23.20% 21.03% 15.16%

Loans Loan Growth 54.38% 47.77% 36.50%

Asset QualityNPL Ratio 2.27% 2.50% 2.56%

Credit Cost 0.53% 0.82% 0.82%

Capital D/E Ratio 6.67 7.58 7.48

Appendix

Insurance Business

Thanachart Capital Plc.

MAX AMCNFS AMCThanachart Bank Plc.

Scotia Netherlands Holding B.V.

Financial Business

Securities Business

Leasing Business

Thanachart Securities Plc.

Thanachart Fund Management

Thanachart Insurance Plc.

Siam City Life Assurance Plc.

TS Asset Management

Thanachart Management and Services

Scib Services

83.44%100.00%

100.00%

100.00%

100.00%

100.00%

100.00%

100.00%

100.00%

50.96%

48.99%

75.00%

As at 30 June 2013

Asset Management Business

Thanachart Group Leasing

Ratchthani Leasing

National Leasing

100.00%100.00%

65.18%

Source: Company data

100.00%Supporting Business

Thanachart Training and Development

Thanachart Broker

Distressed Asset Management

Commercial Banking Business

Thanachart Group Structure

19

THANI Fact Sheet

Equity

Equity MB

Registered Capital 1,610.82

Paid-up Capital 1,610.82

Total Equity 2,866.67

Shareholding Structure

Shareholders %

Thanachart Bank 65.18

Chonkadeedamrongkul Family 8.65

Minority Shareholders 26.17

Remark: As at 8 March 2013 Remark: As at 30 Jun 2013

20

Investor Relations

Ratchthani Leasing Public Company Limited

77-35-36 11UP Floor, Sinsathorn Tower,

Krungthonburi Road, Klongtonsai,

Klongsarn, Bangkok 10600

Tel: (662) 440 0844

Fax: (662) 440 0848

E-mail: [email protected]

Website: http://www.ratchthani.com