Consumer Finance Industry & KTC Portfolio Performances Credit - PowerPoint PPT Presentation

KTC Story Consumer Finance Industry & KTC Portfolio Performances Credit Card Marketing Program Personal Loan Marketing Program

KTC Story

Total Card Portfolio 16.0% Spending Personal loan 11.4% 9.9% (YoY) 14.0% (%YoY) Credit card Net Profit (YoY) 20.6% (YoY) NPL 1.0% COF Personal loan NIM Credit card 1.4% 15.5% 1.9% 3.3% (%YoY) 4

• Incorporated in 1996 as a credit card servicing subsidiary company of Krungthai Bank PLC • In July 2002, KTB sold the credit card portfolio to KTC which subsequently transformed KTC into a full consumer finance company and later listed on the SET in October 2002 Top 10 Shareholders (as of Sep 30, 2016) 1 Krung Thai Bank Public Co., Ltd. 49.45% 2 Mr. Mongkol Prakitchaiwattana 9.42% 49.45% 17.58% 3 Thai NVDR 3.91% 4 Ms. Chantana Jirattitepat 3.25% Thai KTB Institutional 5 CHASE NOMINEES LIMITED 2.64% 6 RBC INVESTOR SERVICES BANK S.A. 1.94% Foreign Thai 7 TISCO Master Pooled Fund 1.40% Individual Thai Value Focus Equity – Dividend Fund (UOBAM) 8 1.26% 13.43% 19.54% SCB DIVIDEND STOCK 70/30 LONG TERM EQUITY 9 1.24% FUND 10 NORBAX, INC. 1.23% 2011 2012 2013 2014 2015 3Q16 Thai Institutional Holding 51.59% 51.63% 53.18% 62.87% 72.01% 67.03% Thai Individual Holding 38.43% 45.21% 43.45% 29.32% 21.87% 19.54% Foreign Holding 9.97% 3.15% 3.37% 7.81% 6.12% 13.43% Total Number of Shareholders 4,198 2,735 3,550 3,125 3,426 3,105 Source: TSD 5

% of Total Receivables % of Total Revenue Credit Card Credit Card Personal loan Personal loan Others (Circle Loan, KTC Million, Others (Circle Loan and KTC Million) and Miscellaneous) (As of September 30, 2016) 6

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Consumer Finance Industry & Consumer Finance Industry & KTC Portfolio Performances KTC Portfolio Performances

Total Credit Card Spending Private Consumption Expenditure Baht Trillion 6.98 6.92 6.76 6.54 5.98 5.63 5.21 5.13 4.77 3.58 19.9% 20.0% 18.9% 17.7% 16.4% 15.1% 14.5% 14.0% 13.2% 12.9% 1.39 1.31 1.20 1.07 0.91 0.81 0.69 0.72 0.71 0.61 6M16 Card Spending CAGR (%) 10.1% CAGR (%) PCE 4.5% Total Credit Card Spending of Industry Private Consumption Expenditure Total Credit Card Spending of Industry (%) Source: BoT & NESDB 9

Market Share # of cards (unit) 54.7% 53.5% 52.0% 2,039,967 51.3% 1,887,015 1,807,755 1,567,283 48.7% 48.0% 46.5% 45.3% 15.3% 13.4% 4.4% 2.5% 8.9% 8.7% 8.9% 8.4% 9M16 9M16 Commercial Banks Non Banks KTC Number of Cards Growth (YoY) %Growth (YoY) Distribution Channels 15.3% 13.4% 22% 25% 27% 30% 10.0% 8.1% Others 7.2% 34% 33% 46% Outsources & Telesale 34% 9.5% 7% 8% KTC Branch 9% 2.5% 5% KTB 4.4% 33% 32% 27% 27% 9M16 9M16 Others: Printing Media Insertion, Marketing Events, Internet, Corporate Alliance, Take One Partner, Industry KTC Network Management, Others Source: BoT & KTC 10

Market Share Baht Million 66.9% 66.4% 66.3% 66.3% 145,800 33.7% 33.7% 33.6% 33.1% 129,828 120,929 118,433 11.0% 10.5% 10.1% 9.9% 103,926 9M16 Commercial Banks Non-Banks KTC 14.0% % Growth (YoY) 12.3% 11.9% 14.0% 12.3% 7.4% 11.2% 9.4% 4.0% 7.4% 6.6% 7.2% 4.0% 9M15 9M16 9M16 Spending Growth (YoY) Industry KTC Source: BoT & KTC 11 11

Baht Million Market Share %Growth (YoY) 41,412 41,325 11.0% 60.8% 60.9% 60.4% 60.1% 1.3% 1.4% 10.1% 9.9% 9.5% 39.9% 39.6% 39.2% 39.1% 6.6% 6.0% 5.8% 37,621 3.8% 1.7% 13.1% 12.2% 12.3% 11.8% 35,297 2.2% 9M16 9M16 98.7% 98.6% Commercial Banks Non-Banks KTC Industry KTC 98.3% Portfolio Quality 97.8% 2.5% %NPL (90dpd) 2013 2014 2015 9M16 2.3% 2.1% 2.0% 3.75% Industry 2.29% 2.61% 3.10% 5.02% Commercial Bank 2.64% 3.17% 3.95% 2013 2014 2015 9M16 1.82% Non-Bank 1.75% 1.75% 1.79% <= 90 days > 90 days Delinquency 1.37% KTC 2.19% 1.66% 1.35% Source: BoT & KTC 12

(unit) 793,486 Market Share 747,343 693,273 81.2% 79.1% 638,959 75.8% 74.5% 8.5% 7.8% 7.9% 25.5% 24.2% 20.9% 18.8% 2.0% 5.6% 5.9% 5.8% 5.9% 9M16 9M16 Amount %Growth (YoY) Commercial Banks Non Banks KTC Distribution Channels %Growth (YoY) 3% 3% 3% 4% 12.5% 8.5% 8.6% 57% 57% Others 7.9% 65% 64% Outsources & Telesale 7.8% KTC Branch 1% 6.6% 2% KTB 2% 2.0% 3% 38% 39% 3.2% 30% 29% Others: Internet, Marketing Events, and Others 9M16 2013 2014 2015 9M16 Industry KTC Source: BoT & KTC 13

%Growth (YoY) Baht Million Market Share 20,294 53.0% 16.3% 52.9% 16.0% 51.4% 51.3% 18,583 11.6% 48.7% 48.6% 47.1% 47.0% 10.1% 14.2% 16,644 4.6% 3.8% 3.6% 15,121 6.1% 5.7% 5.3% 5.1% 9M16 9M16 Industry KTC Commercial Banks Non Banks KTC Portfolio Quality %NPL (90dpd) 2013 2014 2015 9M16 Industry 3.65% 4.55% 5.17% 3.46% Commercial Bank 3.80% 4.56% 5.01% 4.63% 9M16 Non-Bank 3.48% 4.54% 5.33% 2.43% <= 90 days > 90 days Delinquency KTC 1.47% 1.17% 1.04% 1.01% Source: BoT & KTC 14

Key B/S Figures Fund Usage Baht billion Baht billion 61.1 60.2 46.0 45.1 41.6 54.5 73% 39.4 65% 51.9 51.4 51.4 57% 58% 47.1 46.0 45.8 45.1 41.6 4.8% 39.4 4.4% 3.7% 3.3% 13% 4% 13% 7.5 6.4 31% 30% 27% 5.9 29% 5.3 2013 2014 2015 9M16 9.7 Short-term Loan Long-term Loan Debentures Cost of fund 8.7 7.4 6.1 Total Available Credit Line = 25,390 MB  KTB = 18,030 MB Others = 7,360 MB 9M16 KTC rating : A+ by TRIS Assets Liabilities Interest Bearing Debt Equity D/E Source: KTC 15

Y2015 (1) Y2014 9M16 Operating Results Million Baht (%YoY) Million Baht (%YoY) Million Baht (%YoY) Total Revenue 14,337 10.0% 15,559 8.5% 12,840 12.5% Bad Debt Recovery 1,766 22.1% 2,037 15.3% 1,756 18.4% Administrative Expenses 5,377 13.2% 6,139 14.2% 5,084 14.3% Marketing Expenses 945 43.6% 956 1.2% 800 23.7% Fee Paid Expenses 1,180 6.4% 1,701 44.2% 1,512 25.4% Interest Expense 1,764 (5.4%) 1,621 (8.1%) 1,116 (9.2%) Pre-Provisioning Profit 7,195 12.0% 7,799 8.4% 6,640 15.8% Write-Off and Provision 4,989 (2.0%) 5,183 3.9% 4,314 13.6% Profit before Tax 2,206 65.7% 2,616 18.5% 2,326 20.1% Income Tax - Income (Expense) (451) 53.2% (543) 20.3% (472) 18.0% Net Profit (Loss) 1,755 36.8% 2,073 18.1% 1,854 20.6% (1) The company ’ s total comprehensive income was THB 2,074 million (Other comprehensive income THB 0.9 million – net of income tax). Source: KTC 16

Year Year 9M16 2014 2015 Net Profit Margin 14.4% 12.2% 13.3% Cost to Income Ratio 39.6% 37.5% 39.5% Operating Cost to Income Ratio (1) 29.0% 27.3% 29.4% Average Interest Received (including credit usage) 18.8% 18.7% 18.2% Average Cost of Fund 3.3% 4.4% 3.7% Net Interest Margin (including credit usage) 15.5% 14.3% 14.5% D/E Ratio (times) 5.3 6.4 5.9 ROE 26.8% 26.0% 25.7% ROA 4.1% 3.3% 3.6% Allowance/Total Receivables 8.3% 8.9% 8.2% Allowance/NPL 445.8% 363.9% 399.9% Earning per share 7.2 6.8 8.0 Book Value per Share (Baht) 37.8 28.6 33.9 Dividend Payout Ratio NA 40.4% 40.4% (1) Excluding Net Interchange & Marketing Expenses Source: KTC 17

%Growth (YoY) – Total Port Net Profit (MB) 1,755 7.4% 2,073 10.3% 11.4% Target 15% 1,854 (9M16) (9M16) %Growth (YoY) – Total Card Spending %NPL - Total Port 7.4% 2.4% 12.3 % 2.1% 14.0% Target (9M16) 1.9% (9M16) ≤ 2.1%

CREDIT CARD BUSINESS Marketing Program

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Ensure nationwide coverage with chain restaurants Ensure satisfaction of premium customer segments DINING Ensure presence in strategic locations Campaigns