Bangkok--16 Feb--EXIM Thailand
EXIM Thailand announces good operating results in 2006 after making full possible loan loss provision in compliance with the IAS 39 in 2006, instead of gradual provisioning as allowed by the BOT. The Bank advances in full gear to provide integrated financial services for export and overseas investment financing facilities while stepping up organizational restructuring and human resources development to improve loan quality and curtail NPLs.
Dr. Apichai Boontherawara, President of Export-Import Bank of Thailand (EXIM Thailand), said that the Bank’s 2006 operating results were good, meeting its operational targets amidst economic uncertainties. It registered a net profit of 699 million baht after provisions for possible loan loss under the current guideline, a year-on-year increase of 53%. However, to comply with the Bank of Thailand’s new criteria that require all commercial banks in Thailand to make loan-loss provisions according to the International Accounting Standard No. 39 (IAS 39), EXIM Thailand decided to make provisions in full all at once amounting to 2,045 million baht, instead of incremental provisioning in 2006 and 2007 as allowed by the Bank of Thailand before the IAS 39 takes effect in 2008. As a result, EXIM Thailand posted a net loss of 1,346 million baht in 2006. This reflects the Bank’s adherence to good corporate governance and international accounting standards, which will contribute favorably to its present and future fund raising campaigns. Nevertheless, the Bank’s capital adequacy ratio stood at 14.3% in December 2006.
In 2006, the Bank approved new credits and export credit insurance policies in the total amount of 24,014 million baht or 8% above its 2006 operational target. An addition of 5,576 million baht in loans and guarantees, surpassing the 2006 target by 12%, was extended to Thai business operators and contractors in 18 countries. The Bank also commenced its role in intraregional capital market development through the signing of a Memorandum of Understanding (MOU) with Electricite du Laos (EdL) inaugurating the Laotian issue of EXIM Thailand-guaranteed baht-denominated Asian bond worth 1.5 billion baht. The bond proceeds will be used to finance the Nam Ngum 2 hydropower dam and power plant project in Lao PDR. Throughout the year 2006, EXIM Thailand, in cooperation with other agencies, arranged seminars attended by 6,123 participants with an aim to sharpen international business knowledge and management skills of Thai exporters, investors and the general public.
Among the bank’s most remarkable achievements in 2006 is the upgrade of its National Long-term Rating assigned by Fitch Ratings (Thailand) from “AA+(tha)” to “AAA(tha)/Outlook Stable” which is the best creditworthiness rating signifying the lowest risk and highest loan repayment capability. The Bank also received the “Best State Enterprise Board of Directors Award for 2006” granted by the State Enterprise Policy Office, Ministry of Finance.
Dr. Apichai further elaborated that in 2007 EXIM Thailand would place special emphasis on service differentiation by focusing on fully-integrated export financing facilities. The Bank will also highlight its role as development bank introducing new financial products to enhance the potential and competitive edge of Thai exporters and investors abroad. Among these key initiatives are Financing Facilities for Service Providers for Exports to cater for operators of warehouse, product distribution center and freight forwarders. In addition, more resources will be dedicated to improving export credit insurance and investment insurance services with an objective to facilitate further penetration and expansion of Thai trade and investment activities in foreign markets.
The year 2007 will also see more pronounced attempts to deepen Thailand’s trade and investment presence, especially in the Middle East, Greater Mekong Subregion, Russia, Central Asia and ASEAN countries. For instance, EXIM International will be established to help reduce trade settlement obstacles in emerging markets with strong growth potential.
According to EXIM Thailand President, in 2007 the Bank will continue to focus on organizational restructuring and human resources development to further upgrade their skills and expertise to help augment the competitiveness of Thai exporters and investors overseas. The Bank will also concentrate more on credit quality improvement alongside product development to generate additional income, lessen NPLs as well as accentuating its role in supporting Thai exporters and investors contributing to foreign exchange earnings. In this connection, EXIM Thailand plans to separate credit analysis function from marketing operation. This division of responsibilities will allow marketing officers to focus mainly on customer base expansion and credit analysis officers to prudently evaluate customers’ creditworthiness independently from marketing considerations before submitting the loan requests for management approval. Meanwhile, Investment Banking Department which was established earlier this year will work closely with NPL clients with growth potential to find structured finance solutions to delinquent accounts and turn them into performing loans.
For further information, please contact Public Relations Division, Office of Top Management
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