The Thai economy grew by 4.1 percent in 2018, which was higher than the growth of 4.0 percent in the previous year. This was mainly due to export expansion, increases in both public sector investment and private sector investment as well as continuous increase in private consumption. On the other hand, loans in the commercial banking industry grew in line with Thailand’s economic expansion. In this connection, the expansion was propelled by the growth of corporate loans, household debts, home loans and auto hire-purchase loans respectively.
TBANK has been successful in implementing its customer-centric strategy which focuses on promoting TBANK as the customers’ main bank of choice. As a result, TBANK and its subsidiaries have registered net profit growth for four consecutive years, representing an average annual growth rate of 10 percent. In 2018, loan volumes increased by 5.88 percent in line with the growth of retail loans, particularly the automobile hire purchase loans which grew by 13.44 percent. On the other hand, TBANK was able to keep its non-performing loans at a low level continuously with the NPL ratio being 2.30 percent, which was lower than the industry average. This accurately reflected the quality of TBANK’s risk management. As regards shareholders’ equity, TBANK’s BIS ratio rose to 19.45 percent, which was relatively high when compared with the industry average. In addition, TBANK’s Liquidity Coverage Ratio (LCR) based on Basel III standards was above 100 percent, which was higher than the minimum requirement of 80 percent imposed by the BOT. The above-mentioned achievements clearly reflected the operational stability and competitiveness potential of TBANK and its subsidiaries.
Thanks to the growth of TBANK and its subsidiaries, Thanachart Group’s net profit in 2018 reported on the consolidated financial statement was 15,806 million baht, representing an increase of 10.22 percent from the net profit of 14,341 million baht in the previous year. In this connection, net profit attributable to the Company was 7,839 million baht, compared to 7,001 million baht in the previous year. This represented an increase of 11.97 percent from the previous year. In terms of net profit earned per share of stock outstanding, the Company had earnings per share (EPS) of 6.74 baht.
Moreover, in 2018 member companies of Thanachart Group continuously remained well received by external organizations, as witnessed by numerous awards which they received. Among others, the awards included the following:
- Fitch Ratings (Thailand) upgraded the national long-term rating of TBANK from A+ to AA-. In addition, TBANK’s auto loans won the Best Automobile Lending Product of the Year at the Thailand Country Awards 2018 organized by The Asian Banker. In this connection, this was the 2nd consecutive year in which TBANK won this award.
- TNS won the Outstanding Derivatives House Award at the SET Awards 2018 organized by the Stock Exchange of Thailand (SET) together with Money & Banking Magazine. This was the 2nd consecutive year in which TNS won the award.
- TFUND won the Award for the Retirement Mutual Fund – Fixed Income) at the Morningstar Awards 2018 which was jointly organized by the SET, the Association of Investment Management Companies (AIMC), and Morningstar Research (Thailand) Limited. In addition, TFUND won the best mutual fund of the year award in the category of Retirement Mutual Fund - Fixed Income at the Money & Banking Awards 2018 which was organized by Money & Banking Magazine. This represented the 2nd consecutive year in which TFUND won the award. As well, TFUND won the Outstanding Asset Management Company Award at the SET Awards 2018 held by the SET together with Money & Banking Magazine. This was the 6th consecutive year in which TFUND won the award.
- TNI won the Best Non-Life Insurance Company with Outstanding Management Award for 2017 from the Office of Insurance Commission (OIC). This represented the 3rd consecutive year in which this award was won.
In 2019, the commercial banking industry remains affected by several economic and political challenges, changes to supervision regulations, and use of technology to enhance service delivery. As a result, TBANK places emphasis on the implementation of the following: (1) maintaining leadership position in the automobile hire purchase industry, (2) establishing closer relationships with retail customers as well as small and medium-sized enterprises (SMEs), (3) increasing the number of customers using services of TBANK as their main bank of choice by offering attractive deposit products to customers, and (4) strict compliance with the organization’s corporate culture which places strong emphasis on rigorous risk management so that all groups of stakeholders, including customers, employees, shareholders, and the state agencies concerned, supporting and trusting TBANK. In this connection, the Board of Directors is confident that Thanachart Group will be able to maintain the stable position and achieve continuous growth in the future. As a result, the Board of Directors adopted a resolution approving the increase in the interim dividend from 0.90 baht per share in 2017 to 1.00 baht per share in 2018. As well, the Board of Directors proposed to shareholders for approval the 2nd dividend payment of 1.60 baht per share. As a result, the total dividend was 2.60 baht per share, up from 2.20 baht per share for the previous year. This represented a payout ratio of 38.25 percent, base on the net profit attributable to the Company in the consolidated financial statement.
In 2018, the structure of the Company’s Board of Directors underwent changes with the appointment of Mr. Teeranun Srihong as a Director replacing Mr. Taweesak Saksirilarp who retired by rotation at the Annual General Meeting of Shareholders 2018. As well, Mr. Prinya Hom-anek was appointed as Director replacing Mr. Somkiat Sukdheva who resigned during the year 2018. In this connection, the Board of Directors would like to express its appreciation to the two former Directors who made good use of their knowledge in the performance of their duties. On the other hand, the Board of Directors is confident that the two new Directors who have in-depth knowledge and expertise in information technology related to financial business will help give advice and oversee the businesses of Thanachart Group in the digital era so that the Group is able to serve customers in an efficient manner while they are safeguarded adequately by the secure information technology.
The Board of Directors pays attention to the good corporate governance as it enables the Company to grow in a sustainable manner while it accepts responsibility towards the society and all groups of stakeholders. In 2018, the Company achieved an excellent level (five stars) of recognition in the Corporate Governance Report of Thai Listed Companies (CGR) issued by the Thai Institute of Directors Association (IOD). Noteworthy was the fact that the Company earned the perfect score of 100 from the Thai Investors Association for organizing the annual general meeting of shareholders. The Company also played a partial role in fighting corruption. In this connection, all member companies of Thanachart Group were certified members of Thailand's Private Sector Collective Action Coalition against Corruption (CAC) since 2014. In relation to social responsibility and environmental protection, the Company continued to support the activities related to energy conservation and wise use of resources. Importantly, it produced media materials for sharing knowledge about the basics of personal financial management and the correct methods to save money. The objective was to promote personal financial stability in the long term. Also noteworthy is the fact that the Company continues implementing corporate social responsibility activities in various areas, the details of which are given in this annual report.
Last but not least, the Board of Directors would like to express its appreciation to all the parties concerned for their support to Thanachart Group’s business operations and the Board’s performance of duties. Thanks to the continuous support from all the parties, the Board of Directors is confident that Thanachart Group will grow robustly and become more successful in the future.
On behalf of the Board of Directors,