รายงานประจำาปี 2554 รายงานของฝ่ายจัดการ 01 ANNUAL REPORT 2011 KASIKORNBANKGROUP CUSTOMER Centricity • Multi-Corporate Business • Large Corporate Business • Medium Business • Small and Micro Business • High Net Worth Individual • Affluent • Middle Income • Mass Mission KASIKORNBANKGROUP aims to be a strong Thai financial group that provides a variety of financial services of world-class quality responsive to serve customers’ needs by harmoniously combining technology and human resources so as to achieve optimal benefits to customers, shareholders, employees and the country. Vision KASIKORNBANKGROUP aims to be the strongest, the most innovative and the most proactive Thai financial group in serving customers. Core Values • Customer Centricity • Group-Wide Teamwork • Professionalism • Innovation Annual Report 2011 002 Management Report FINANCIAL HIGHLIGHTS (CONSOLIDATED FINANCIAL STATEMENTS) As of or for the years ended December 31, 2011 2010 2009 COMMON SHARE INFORMATION Per share (Baht) • basic earnings 10.12 8.38 6.16 • book value 64.68 56.38 50.14 • dividends 2.50 2.50 2.50 Share price (Baht)1) • high 144.00 130.00 91.00 • low 99.75 77.25 40.25 • closing 122.00 125.50 85.00 Common shares outstanding • average basic (million share) 2,393.26 2,393.26 2,393.26 • end of year (million share) 2,393.26 2,393.26 2,393.26 Market capitalization (Million Baht) 291,978 300,354 203,427 VALUE MEASURES Price to earnings ratio (PER) 12.06 14.98 13.80 Price to book value ratio (PBV) 1.89 2.23 1.70 Dividend yield (based on closing share price) 2.05% 1.99% 2.94% Dividend payout ratio 27.00% 32.14% 42.49% Number of employees2) 16,580 15,677 15,464 Number of branches2) 816 805 782 OPERATING RESULTS (Million Baht) Interest income - net 56,491 46,744 39,857 Non-interest income 34,017 28,400 21,683 Fees and service income - net 20,637 18,227 15,937 Other income 45,087 35,394 7,686 Underwriting expenses 31,707 25,221 1,940 Total operating income - net 90,508 75,144 61,540 Total other operating expenses 43,019 38,003 31,338 Impairment loss on loans and debt securities 7,345 6,701 9,376 Operating profit before provision expense and income tax expense3) 47,489 37,141 30,202 Net profit4) 24,226 20,047 14,733 FINANCIAL POSITION STATEMENT INFORMATION (Million Baht) Loans5) 1,210,834 1,076,981 941,145 Allowance for doubtful accounts and revaluation allowance for debt restructuring 40,343 36,832 34,045 Non-performing loans net (NPL net)6) 14,698 16,022 18,473 Non-performing loans gross (NPL gross) 31,736 33,175 37,152 Total assets 1,722,940 1,546,664 1,362,838 Deposits 1,242,229 1,100,036 975,492 Total liabilities 1,555,974 1,401,177 1,234,692 Equity4) 154,799 134,943 119,997 Risk weighted assets 1,269,282 1,131,218 1,004,092 Note: • Financial statements as at 31 December 2010 and 2009 have been reclassified to be presented in order to comply with Thai Financial Reporting Standards and the Bank of Thailand (BOT) notification number Sor Nor Sor 11/2553, directive dated 3 December 2010, regarding “The preparation and announcement of the financial statements of commercial banks and holding companies which are parent company of group of companies offering financial services”. • The 31 December 2009 consolidated financial position statement included all items of assets and liabilities of MTGH Group. The consolidated statement of comprehensive income included 1 month operating result of MTGH Group for the period ended 31 December 2009. 1) Local board / High-low share prices during the year 4) Excluding non-controlling interests 2) Bank only 5) Loans = Loans to customers less Deferred revenue 3) Provision expense = Impairment loss on loans and debt securities 6) Non-performing loans net refer to the non-performing loan value, net of total allowances for doubtful accounts Annual Report 2011 Management Report 003 FINANCIAL HIGHLIGHTS (CONSOLIDATED FINANCIAL STATEMENTS) Net Profit NPL Gross to Total Loans Million Baht Trillion Baht 30,000 4.00% 1.40 24,226 3.76% 1.21 25,000 3.50% 1.08 1.20 20,047 3.00% 20,000 0.94 2.45% 1.00 14,733 2.50% 2.91% 0.80 15,000 2.00% 0.60 10,000 1.50% 1.00% 0.40 5,000 0.50% 0.20 0 0.00% 0.00 2009 2010 2011 20092009 20102010 20112011 Net Profit Loans NPL Gross to Total Loans Total Assets Total Liabilities Trillion Baht Trillion Baht 1.80 1.72 2.00 1.56 1.55 1.80 1.40 1.60 1.36 1.60 1.23 1.40 1.40 1.20 1.20 1.00 1.00 0.80 1.24 0.80 1.08 1.21 0.60 0.98 1.10 0.60 0.94 0.40 0.40 0.20 0.20 0.00 0.00 2009 2010 2011 2009 2010 2011 Loans Total Assets Deposits Total Liabilities As of or for the years ended December 31, 2011 2010 2009 PERFORMANCE INDICATORS Net interest margin (NIM) 3.75% 3.48% 3.23% Non-interest income to average assets 2.08% 1.95% 1.62% Non-interest income ratio 37.58% 37.79% 35.23% Efficiency ratio 47.53% 50.57% 50.92% Return on average assets (ROAA) 1.48% 1.38% 1.10% Return on average equity (ROAE) 16.72% 15.73% 12.79% ASSET QUALITY RATIOS Loans to deposits ratio 97.47% 97.90% 96.48% Loans to deposits and B/E ratio 94.72% 93.51% 92.80% Tier 1 capital ratio 9.63% 9.37% 10.25% Total capital ratio 13.81% 13.96% 15.19% NPL net to total loans7) 1.15% 1.43% 1.91% NPL gross to total loans8) 2.45% 2.91% 3.76% Provision expense to average loans (Credit cost)9) 0.64% 0.66% 1.02% Total allowance to loans10) 3.33% 3.42% 3.62% Total allowance to NPL gross (Coverage ratio)10) 127.12% 111.02% 91.64% Note: • Financial statements as at 31 December 2010 and 2009 have been reclassified to be presented in order to comply with Thai Financial Reporting Standards and the Bank of Thailand (BOT) notification number Sor Nor Sor 11/2553, directive dated 3 December 2010, regarding “The preparation and announcement of the financial statements of commercial banks and holding companies which are parent company of group of companies offering financial services”. • The 31 December 2009 consolidated financial position statement included all items of assets and liabilities of MTGH Group. The consolidated statement of comprehensive income included 1 month operating result of MTGH Group for the period ended 31 December 2009. 7) Loans used in calculation are loans to general customers and loans to financial institutions after allowance for doubtful account of non-performing loan 8) Loans used in calculation are loans to general customers and loans to financial institutions 9) Provision expense = Impairment loss on loans and debt securities 10) Allowance = Allowance for doubtful accounts and revaluation allowance for debt restructuring CONTENTS 5 BOARD OF DIRECTORS’ REPORT MANAGEMENT REPORT Management Report 7 Management Discussion and Analysis 9 1. Overview 2. Operating Performance and Financial Position Analysis 3. Operations of Core Businesses 4. Operations of Support Groups 5. KASIKORNBANK’s Investments in Subsidiaries and Associated Companies Risk Management and Risk Factors 55 1. Overall Risk Management 2. Risk Management 3. Capital Management FINANCIAL REPORTS Report of the Board of Directors’ Responsibilities for Financial Reports 71 Report of the Audit Committee 72 Audit Report of Certified Public Accountant 74 Financial Statements 76 Notes to the Financial Statements 84 CORPORATE GOVERNANCE Report of the Corporate Governance Committee 219 Report of the Human Resources and Remuneration Committee 220 Corporate Governance 221 1. Rights of Shareholders 2. Equitable Treatment of Shareholders 3. Roles of Stakeholders 4. Disclosure and Transparency 5. Responsibilities of the Board of Directors Dividend Policy 254 Factors Affecting Investment Decisions 255 CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES Business Activities 257 Environment and Safety 266 Employees 269 Social Activities 274 Plans for CSR Activities in the Future 281 STRUCTURE Organization Chart 284 Board of Directors 286 Board of Directors and Executives 288 Directorship of Directors and Executives in Subsidiaries, Associated, and Related Companies 300 Changes in KASIKORNBANK Shares Held by Directors and Executives in 2011 302 Management Team 303 Investment of KASIKORNBANK in Other Companies 308 OTHER INFORMATION Reference Information 311 Major Shareholders 312 Awards and Commendations 313 KASIKORNBANKGROUP KASIKORNBANK 321 1. Domestic Branch 2. Foreign Exchange Booth 3. K-Safe Deposit Box Center 4. THE WISDOM Exclusive Center 5. THE WISDOM Corner 6. THE WISDOM K-Safe Deposit Box Center 7. K-WePlan Branch 8. Corporate Business Center 9. Corporate & SME Service Center 10. SME Business Center 11. Overseas Office K Companies 347 SUMMARY OF SPECIFIED ITEMS PER FORM 56-2 349 Annual Report 2011 Management Report 005 BOARD OF DIRECTORS’ REPORT KASIKORNBANKGROUP experienced another of campaign execution through branch platform, thus leading successful year in 2011, as one of Thailand’s leading to creation of cross-selling, up-selling, better campaign financial conglomerates. Net profits were up 20.85 percent, response rate, as well as higher product holding to Baht 24,226 million, and total financial solutions continued and sales amount/transaction volume per customer. to be developed and extended to cover all customer For Small SME & Micro Segment, the benefit has been segments, both at home and abroad. In addition to realized in lead/referral across channels, sales planning the 816 KASIKORNBANK branches and 7,366 ATMs & sales management activities.