Bangkok--15 Jul--Aziam Burson- Marsteller Unfavorable market conditions lead investors very close to ‘pessimistic’ stance Key Highlights of the Quarterly ING Investor Dashboard Survey Thai investor sentiment falls to 81 for Q2 2008 from 131 for Q1 2008 to become the least optimistic market in Asia Developed markets like Hong Kong and Singapore believe in a rebound in the investment markets Rising inflation, political uncertainties including fears of another coup and volatile food prices continue to influence Thai investors who are shifting portfolios in favor of low risk investments Lone bright spot on the horizon is increasing optimism of a recovery in the US economy in Q3 2008 which augurs well for Thai exports Overall investor sentiment in Asia falls 13% to 109 for Q2 2008 from 125 for Q1 2008 as global economic slowdown continues and regional political developments begin to weigh on investors ING, the global financial services group, today released data from the quarterly ING Investor Dashboard survey which shows that Thai investor sentiment has decreased considerably coupled with a strong overall decline in investor sentiment in Asia. Thai investor sentiment fell 38% to 81 for Q2 2008 from 131 for Q1 2008. This significant decline in investor sentiment caused Thai investors to rank very close to ‘pessimistic’ as current sentiment is considered the weakest among all investors in Asia. Asia’s overall decline is led by China and many of the Southeast Asian markets. This is the first time the pan-Asia sentiment index has moved into neutral sentiment from optimistic sentiment since the introduction of the investor sentiment survey in Q3 2007. The overall ING Investor Dashboard pan-Asia sentiment index falls for the third consecutive quarter to 109 for Q2 2008 from 125 for Q1 2008 as internal and external economic factors and domestic political developments weigh on investors in Q2 2008. The pan-Asia sentiment index registers 135 for Q4 2007 and 141 for Q3 2007. The ING Investor Dashboard is the first quarterly survey in the Asia Pacific region that provides a pan-Asia (ex-Japan) investor sentiment index. The survey is conducted quarterly across 13 markets* in Asia Pacific, and not only provides market insights on investor attitudes and outlook but also allows each market to be benchmarked and tracked against the overall investor sentiment across Asia using the pan-Asia index. Thai investors are the most pessimistic in Asia in Q2 2008 The Index results show that the Thai market has become markedly more pessimistic during Q2 2008 and is very close to being classified as pessimistic by the Dashboard. The reasons behind this decline in sentiment are varied and include renewed political instability including the possibility of a coup and concern over the current government’s policies, strong inflationary pressures driven by food and fuel prices and a weak stock market that has declined 12% between May 25, 2008 and June 1, 2008. Thai investor sentiment fell considerably to 81 for Q2 2008 from 131 from Q1 2008; and 32% of Thai investors think the stock market will rise the next quarter (Q3 2008) compared to 60% the quarter before The data shows that Asian investors, particularly Hong Kong investors, are more positive about the outlook for Q3 2008 compared to sentiment for Q2 2008 and are more positive about the U.S. economy for Q3 2008. And while Thai investors share this optimism about a pick up in the US economy in Q3 2008, the overall economic situation in Thailand is expected by investors to be at its worst as compared to all previous quarters.In Thailand: 18% of Thai investors have a positive outlook for the economy in Q3 2008 compared to 12% who say the economy improved in Q2 2008 34% of Thai investors say they expect their return on investment to increase in Q3 2008 compared to 29% who say their return on investments increased in Q2 2008 29% of Thai investors say they expect their personal financial situation will improve in Q3 2008 compared to 31% who say their personal financial situation improved in Q2 2008 49% of Thai investors believe the U.S. economy will improve the following quarter (Q3 2008) compared to 30% the quarter before “While the fundamentals of the Thai economy, especially exports of both agricultural as well as manufactured goods remain relatively strong, the combination of increasing inflation and low consumer confidence may combine to reduce GDP growth rates creating a vicious cycle. This situation is being exacerbated by the political instability which has weakened confidence among both domestic and foreign investors. The government’s ability to manage both inflation and political stability will be critical factors in determining Thai economic performance for the remainder of the 2008,” said Maris Tarab, Chief Executive Officer, ING Funds (Thailand) Limited. In Asia (ex-Japan): 41% of Asian investors (ex-Japan) have a positive outlook for the economy in Q3 2008 compared to 25% who say the economy improved in Q2 2008 45% of investors (ex-Japan) also say they expect their return on investment to increase in Q3 2008 compared to 30% who say their return on investments increased in Q2 2008 46% of investors (ex-Japan) say they expect their personal financial situation will improve in Q3 2008 compared to 35% who say their personal financial situation improved in Q2 2008 34% of investors (ex-Japan) also believe the U.S. economy will improve the following quarter (Q3 2008) compared to 29% the quarter before This is despite continued concerns about the subprime crisis and inflation where 64% of Thai investors and 71% of Asian investors (ex-Japan) expect the subprime to affect their investment decisions in Q3 2008, and 91% of Thailand investors and 81% of Asian investors (ex-Japan) expect inflation to affect their investment decisions in Q3 2008. * The survey was conducted across 13 markets in Asia Pacific including Hong Kong, China, India, Indonesia, Korea, Malaysia, the Philippines, Singapore, Taiwan, Thailand, Japan, Australia and New Zealand. The pan-Asia investor sentiment index includes all Asia markets and excludes Japan, Australia and New Zealand China index also declines significantly and is seen to lag in investor sentiment cycles As an increasingly important trading partner of Thailand and a major player in the global economy, investor sentiment in China is relevant to Thai investors and business leaders. The Index for China fell considerably to 117 for Q2 2008 from 136 for Q1 2008, moving from optimistic to neutral for the first time despite continued growth in the economy and the upcoming Olympics Games in Beijing. The Index results suggest that investors in China are beginning to absorb the effects of the global economic slowdown and market pressures: 46% of China investors say their economic situation in Q2 2008 deteriorated compared to 41% in Q1 2008 56% say their return on investment in Q2 2008 deteriorated compared to 45% in Q1 2008 35% say their personal financial situation in Q2 2008 deteriorated compared to 15% in Q1 2008 The data also shows that while of 87% of Chinese investors expect the Chinese economy to be boosted by the Beijing Olympic Games, 41% respondents expect the economy to slow down after the Games end in August. Similar sentiment is also seen in Hong Kong, which is co-hosting the Games. 76% of Hong Kong investors expect the local economy to be boosted by the Games, but 49% expect the economy to slow down after the event. Looking at other parts of Asia, survey results show that the developing markets in Southeast Asia lead the overall decline in investor sentiment in the region as local market and political developments coupled with global economic pressures weigh on investors. Thailand, Malaysia, Indonesia and the Philippines registered the largest falls in investor sentiment. India also reflected a slight decline. Inflation expected to rise and remains key concern for Thailand The ING Investor Dashboard results show that 71% of Thai investors expect inflation to continue rising in Q3 2008 while 91% of them expect inflation to affect their investment decisions in the coming quarter. Thai investors seem especially keen on using stocks as an investment tool to beat inflation -- 71% of the Thai investors who are considering reallocating their portfolios and/or investing more to beat inflation are considering investing in stocks, while cash/deposits (24%) and properties (18%) are also among the most popular investment tools for this purpose. 61% of Asian investors (ex-Japan) expect inflation to continue rising in Q3 2008 and 81% expect inflation to affect their investment decisions in the coming quarter. The survey also yielded the following interesting data about Thailand: 35% of Thai investors applied for IPOs in Q2 2008, and 28% of Thai investors intend to apply for IPOs in Q3 2008 39% of Thai investors say they would consider investing in global resources such as oil, gas, metals and water in Q3 2008 “An unstable political landscape, rapidly rising inflation and volatile food prices have all contributed to the lowest reading of investor sentiment that we have seen in several quarters. Nearly fifty percent of persons surveyed confirmed plans to invest less in order to reserve money for high priced consumer essentials. Inflationary expectations continue to rise, which becomes self-fulfilling as more companies push for further increases and employees demand higher wages. One of the few silver linings in the current investor sentiment index is the view shared by an increasing number of Thais that the US economy may pick up in the next quarter which could help [Thai] exports maintain their current trend,” said Maris Tarab, Chief Executive Officer, ING Funds (Thailand) Limited. For detailed (high-resolution) data charts on the ING Investor Dashboard Sentiment Index, please download the results presentation from: http://www.ing.asia/investor_dashboard Notes to Editors About the ING Investor Dashboard The ING Investor Dashboard survey measures and tracks investor sentiment and behaviour of mass affluent investors each quarter from 13 Asia Pacific markets including China, Hong Kong, India, Indonesia, Korea, Malaysia, the Philippines, Singapore, Taiwan, Thailand, Japan, Australia and New Zealand. Each market covered by the survey is assigned an investor sentiment score ranging from 0 (the least optimistic) to 200 (the most optimistic). It is the first quarterly survey in Asia Pacific which provides a specific industry benchmark for pan-Asia (ex-Japan) investor sentiment. Each quarter, the pan-Asia ING Investor Dashboard sentiment index is also developed as part of the survey. The pan-Asia sentiment index is derived from the median sentiment index scores of 10 of the Asian markets including China, Hong Kong, India, Indonesia, Korea, Malaysia, the Philippines, Singapore, Taiwan, and Thailand (excludes Japan, Australia and New Zealand). The ING Investor Dashboard was launched in Asia Pacific following the success of ING's Investor Barometer in Europe. The Investor Barometer is published regularly in the Netherlands and Belgium to gauge the confidence of private investors. It is considered an authoritative measure of the sentiment of private investors and is closely followed by key players in the European financial industry. The Q3 2007, Q4 2007 and Q1 2008 surveys were carried out in August 2007, December 2007, and March 2008 respectively. The Q2 2008 survey was conducted in June 2008 and involved face-to-face or online interviews with a total of 1,313 mass affluent investors across the 13 Asia Pacific markets. The respondents are aged 30 years and above, and have disposable assets or investments of US$100,000 and above, with the exception of Indonesia (disposable assets or investments of US$56,000 and above) and the Philippines (disposable assets or investments of US$100,000 or monthly income of Php250,000 and above). The survey is conducted by international and independent research firm TNS. Profile of ING ING is a global financial institution of Dutch origin offering banking, insurance and asset management to over 85 million private, corporate and institutional clients in more than 50 countries. With a diverse workforce of about 130,000 people, ING comprises a broad spectrum of prominent companies that increasingly serve their clients under the ING brand. Profile of TNS TNS is the world’s foremost provider of custom research and analysis, combining in-depth industry sector understanding with world-class expertise in the areas of Retails and Shopper Insights, Stakeholder Management, New Product Development and Brand and Communications. It works in partnership with its clients, meeting their needs for high-quality information, analysis and foresight across a network of over 70 countries. APPENDIXQ2 08 Ranking Country Q2 08 Q1 08 Q4 07 Q3 07 Index Score Index Score Index Score Index Score 1 India 163 168 167 168 2 Hong Kong 123 107 148 141 3 China 117 136 132 164 4 Philippines 110 121 153 148 5 Taiwan 109 105 83 134 6 Indonesia 108 131 136 133 7 Australia 105 89 131 125 8 New Zealand 98 90 118 114 9 Singapore 90 88 136 141 10 Korea 87 96 113 137 11 Malaysia 82 128 124 148 12 Thailand 81 131 134 129 13 Japan 73 60 71 89 Note: The Investor Sentiment Score gauges the confidence of private investors in investment across 13 Asia Pacific countries. Press enquiries Jumpon Saimala ING Thailand +662 688 7780 [email protected] Jeremy Plotnick Aziam Burson- Marsteller +662 252 9871 [email protected]