Growing Together Annual Report 2020 Krungthai is ready to grow along with you in the Digital era. With world-class technology, we shall push the limits to enable our customers, employees, shareholders and all Thai people to completely enter a cashless-society and have better quality of life. Pillar Pillar Seek for alliances to create new business models, Sustain core business of the Bank (Carrier) to run firmly generate new sources of income and respond to the Next Normal era as well as grow cautiously and sustainably EXECUTION Pillar PILLARS Expand business from the Bank’s customers To cope with the ongoing impact of the Perfect Storm, the Bank (X2G2X) Pillar continues to drive the 2 Banking Models strategy with the 5 Execution Pillars. Operate business on transparency and sustainability according to the vision of “Growing Together for Sustainability” Pillar Optimize work processes towards Digitization with paperless Pillar Seek for alliances to create new business models, generate new sources of income and respond to the Next Normal era EXECUTION Pillar PILLARS Expand business from the Bank’s customers To cope with the ongoing impact of the Perfect Storm, the Bank (X2G2X) continues to drive the 2 Banking Models strategy with the 5 Execution Pillars. Pillar Optimize work processes towards Digitization with paperless 19 Awards of Pride Bank of Thai people for Thai economy and Thai society to grow sustainably. 10 12 11 13 5 9 6 14 16 7 8 4 15 1 2 3 The Asian Banker TMA State Enterprise Policy Office (SEPO) Siamrath 1. Leadership Achievement Award for 5. Thailand Corporate Excellence Award 2020 10. Outstanding Board of Director Awards 2020 16. Popular State Bank of Technology Best Managed Bank during COVID-19 in Thailand The Bank is an organization with excellence in 11. Outstanding Corporate Management Awards 2020 and Innovation Award 2. Best CEO Response to COVID-19 in Thailand Award terms of corporate management in various fields. 12. Outstanding COVID-19 Crisis Management Awards 2020 The Bank received online voting as The Bank has outstanding administration 6. Thailand Digital Excellence Award 2020 The Bank exhibited the good cooperate governance, the organization that truly gained popularity in all aspects during COVID-19 pandemic. The Bank established Krungthai Innovation Lab as a center operated business effectively and performed outstanding in social media. for innovation and high technology, endeavoring to lay management during the COVID-19 pandemic. The Banker the foundation for innovative financial services. Money and Banking 3. Bank of the Year 2020 in Thailand Award The Stock Exchange of Thailand 17. Financier of the Year Award 2020 The Bank is a state commercial bank with LINE Thailand 13. SET Awards 2020 - Thailand Sustainability Investment distinctive management in all dimensions. 7. Best Smart Channel in Finance & Insurance Award: (THSI) Award Thaipat Institute Krungthai Care The Bank is a listed company that operated its business 18. Sustainability Disclosure Award 2020 CFI 8. Best Official Account of the Year Award: Krungthai Connext with regard to the environment, society 4. Best Social Impact Bank - Thailand 2020 Award The Bank has provided the full-fledged financial services. and good corporate governance. Bangkokbiz The Bank is a state commercial bank that played 19. Business Person of the Year 2020 an important role in steering the nation’s economy Thai ESCO Association Business+ 9. ESCO Excellent Financial Supporting Award 14. Thailand Top Company Awards 2020 – Financial Industry The Bank is the leading financial institution that 15. Product of the Year Awards 2020 – Krungthai NEXT supported the energy service companies business. The Bank had excellent performance and won the award trough the consumer survey voting via online media as the best product and services of the year. 19 Awards of Pride Bank of Thai people for Thai economy and Thai society to grow sustainably. 10 12 11 13 5 9 6 14 16 7 8 4 15 1 2 3 The Asian Banker TMA State Enterprise Policy Office (SEPO) Siamrath 1. Leadership Achievement Award for 5. Thailand Corporate Excellence Award 2020 10. Outstanding Board of Director Awards 2020 16. Popular State Bank of Technology Best Managed Bank during COVID-19 in Thailand The Bank is an organization with excellence in 11. Outstanding Corporate Management Awards 2020 and Innovation Award 2. Best CEO Response to COVID-19 in Thailand Award terms of corporate management in various fields. 12. Outstanding COVID-19 Crisis Management Awards 2020 The Bank received online voting as The Bank has outstanding administration 6. Thailand Digital Excellence Award 2020 The Bank exhibited the good cooperate governance, the organization that truly gained popularity in all aspects during COVID-19 pandemic. The Bank established Krungthai Innovation Lab as a center operated business effectively and performed outstanding in social media. for innovation and high technology, endeavoring to lay management during the COVID-19 pandemic. The Banker the foundation for innovative financial services. Money and Banking 3. Bank of the Year 2020 in Thailand Award The Stock Exchange of Thailand 17. Financier of the Year Award 2020 The Bank is a state commercial bank with LINE Thailand 13. SET Awards 2020 - Thailand Sustainability Investment distinctive management in all dimensions. 7. Best Smart Channel in Finance & Insurance Award: (THSI) Award Thaipat Institute Krungthai Care The Bank is a listed company that operated its business 18. Sustainability Disclosure Award 2020 CFI 8. Best Official Account of the Year Award: Krungthai Connext with regard to the environment, society 4. Best Social Impact Bank - Thailand 2020 Award The Bank has provided the full-fledged financial services. and good corporate governance. Bangkokbiz The Bank is a state commercial bank that played 19. Business Person of the Year 2020 an important role in steering the nation’s economy Thai ESCO Association Business+ 9. ESCO Excellent Financial Supporting Award 14. Thailand Top Company Awards 2020 – Financial Industry The Bank is the leading financial institution that 15. Product of the Year Awards 2020 – Krungthai NEXT supported the energy service companies business. The Bank had excellent performance and won the award trough the consumer survey voting via online media as the best product and services of the year. Live Your Life Smarter in Just One App Krungthai NEXT provides you convenience with AI features: New version, more pleasure to use, quick interaction and fulfillment of all your needs. Easy and convenient online transactions in just one app. Live Your Life Smarter in Just One App Krungthai NEXT provides you convenience with AI features: New version, more pleasure to use, quick interaction and fulfillment of all your needs. Easy and convenient online transactions in just one app. Contents 001 036 120 188 Financial Highlights Business Environment Risk Factors Report of the Audit Committee 002 040 130 190 Message from Policy and Business Internal Control and The Board of Directors’ the Chairman Overview Risk Management Responsibility for Financial Reports 004 052 137 191 Message from Business Operation Report of Independent Independent the President Director Committee Auditor’s Report 007 064 139 196 Statement of Direction, Management Analysis and Report of the Corporate Financial Statements Vision and Mission Discussion Governance and Social Responsibility Committee 008 085 140 204 Organization Chart Shareholding and Report of the Nominating Table of contents Management Structure and Remuneration for Notes to the Financial Committee Statements 010 113 141 205 The Board of Directors Report of the Board of Corporate Governance Notes to the Financial Executive Directors Statements 014 116 179 348 The Executive Officers Report of the Compliance Related–Party General Information Committee Transactions and Other Major Information 019 118 184 357 Brief Biography of Board Report of the Risk Corporate Social Banking Network of Directors and Executive Oversight Committee Responsibility Officers Annual Report 2020 001 Financial Highlights Loans Net BIS Total (Less Deferred Revenue) Interest Income Capital Ratio 2020 2020 2020 2,334,842 88,343 19.11% million baht million baht 2019 2019 2019 2,089,873 88,316 19.01% million baht million baht 2019 2020 2019 2020 2019 2020 Consolidated Krungthai Bank 2020 2019 2018 2017 2016 2020 2019 2018 2017 2016 (Restated) (Restated) Financial Standing (Million Baht) Loans 2,334,842 2,089,873 2,024,205 1,938,082 1,904,089 2,252,022 2,006,313 1,948,702 1,865,396 1,837,120 (Less Deferred Revenue) Allowance for expected credit loss 150,528 135,228 133,755 125,381 110,782 140,590 126,732 125,340 116,743 102,922 / Allowance for Doubtful Accounts (Including Revaluation Allowance for Debt Restructuring) NPLs 107,138 102,659 106,370 103,020 91,128 103,254 99,224 102,634 98,637 86,786 Total Assets 3,327,780 3,012,216 2,739,203 2,854,210 2,689,703 3,226,987 2,908,358 2,656,181 2,771,583 2,614,798 Total Deposits 2,463,225 2,155,865 2,039,602 2,070,875 1,972,404 2,466,780 2,158,460 2,042,948 2,073,594 1,975,158 Total Liabilities 2,972,717 2,663,890 2,425,062 2,559,991 2,410,299 2,918,012 2,604,135 2,368,676 2,501,454 2,354,343 Total Equity 355,063 348,326 314,141 294,219 279,404 308,975 304,223 287,505 270,129 260,455 Total Equity 343,466 338,287 305,875 287,861 274,187 308,975 304,223 287,505 270,129 260,455 (Equity Holders of the Bank) Operating Performance (Million Baht) Interest Income 112,837 122,971 119,770 122,886 129,230 97,894 108,320 105,937