DBS Group Holdings Ltd · SGX:D05
DBS — Merger or Acquisition (January 2004)
20 slides from DBS's merger presentation, Jan 28, 2004
Slide 1: Growing competitive options in Thailand
Growing competitive options in Thailand 28 January 2004 DBS Group Holdings Presentation to Media and Analysts Disclaimer: The information contained in this document is intended only for use during the presentation and should not be disseminated or distributed to parties outside the presentation. DBS
Slide 2: Growing competitive options in Thailand
Growing competitive options in Thailand T Transaction highlights T Consistent Pan-Asian strategy to seek scale, balance and growth T Combining strengths to capitalize on Thai growth prospects T Additional transaction information 2
Slide 3: Partnership improves competitive position, options
Partnership improves competitive position, options TMB DBS / DTDB Sizeable customer base in urban and Regional scale and capabilities up-country markets Product development and innovation Extensive retail distribution network Processing and operational excellence Meaningful player in Tha
Slide 4: Transaction term sheet
Transaction term sheet Tender offer by TMB for all DTDB securities, including MCAPS securities, in exchange for new TMB securities DTDB becomes a subsidiary of TMB Transaction structure Asset transfer of all DTDB assets and liabilities to TMB pursuant to Section 38, Thai Commercial Banking Act
Slide 5: Merger effect on DBS Group
Merger effect on DBS Group Issue Impact on DBS Group DBS expects proportionate representation on the board subject to Board a minimum of two nominees and the right to nominate an representation independent director No additional cash or capital needed from DBS for merger Capital/Cash DBS may,
Slide 6: Growing competitive options in Thailand
Growing competitive options in Thailand T Transaction highlights T Consistent Pan-Asian strategy to seek scale, balance and growth T Combining strengths to capitalize on Thai growth prospects T Additional transaction information 6
Slide 7: Strategic goals: scale, distribution, balance, growth
Strategic goals: scale, distribution, balance, growth Focus Area What DBS has done What this transaction offers Integrated back-office systems for products: Increase scale, strengthen footprint credit cards, trade finance, treasury & markets Improve unit cost processing, efficiency Scale Con
Slide 8: Balance and growth
Balance and growth Vision for balance: Achieving a stable and more diversified earnings base and building a stronger franchise 6M 2001 Revenues 6M 2003 Revenues S$1,528 million S$2,043 million (S$ million) (S$ million) Thailand & other countries 112(6%) Thailand & other ASEAN countries 71 (4%) Hong
Slide 9: Growing competitive options in Thailand
Growing competitive options in Thailand T Transaction highlights T Consistent Pan-Asian strategy to seek scale, balance and growth T Combining strengths to capitalize on Thai growth prospects T Additional transaction information 9
Slide 10: Combining strengths to capitalize on Thai growth prospects
Combining strengths to capitalize on Thai growth prospects Core banking business focused on Best practices in risk management consumers and SMEs underpin core business strategy DBS / DTDB: Ability to develop and risk DBS / DTDB: Leading credit, market and manage wide range of products and operationa
Slide 11: Increasing scale in Thailand
Increasing scale in Thailand Total assets Total gross loans Total customer deposits (THB bn) (THB bn) (THB bn) BBL 1,115 BBL 1,359 KTB 980 BBL 840 KTB 1,006 KTB 1,136 Kbank 531 Kbank 685 Kbank 821 SCB 737 SCB 506 SCB 607 BAY 516 BAY 396 BAY 421 TMB+DTDB 480 TMB+DTDB 383 SciB 407 SciB 469 SciB 322 TM
Slide 12: Enhancing distribution throughout the country
Enhancing distribution throughout the country Branch distribution network Total domestic Total ATMs by region branches Northern region (50, 3) BBL 621 BBL 1,700 Northeastern region KTB 616 Kbank 1,100 (43, 3) SCB 501 SCB 1,087 Kbank 497 KTB 1,083 Central/Western TMB+DTDB 426 region TMB+DTDB 953 (108
Slide 13: Maintaining strong asset quality
Maintaining strong asset quality NPL ratio (%) Loan Loss coverage (%) 133.9% 24.8% 19.2% 17.7% 89.9% 89.4% 87.6% 15.1% 80.7% 75.5% 73.1% 12.9% 12.5% 66.2% 64.3% 10.5% 10.0% 9.9% 8.1% 41.4% 35.9% 2.7% BAY BAY BOA BoA Kbank BBL IFCT Kbank SciB TMB+DTDB KTB TMB DTDB SCB BBL IFCT TMB+DTDB SCB DTDB TMB K
Slide 14: Growing competitive options in Thailand
Growing competitive options in Thailand T Transaction highlights T Consistent Pan-Asian strategy to seek scale, balance and growth T Combining strengths to capitalize on Thai growth prospects T Additional transaction information 14
Slide 15: Overview of TMB
Overview of TMB Operating Income Mix (THB billion, %) Summary Financial Information (a) (THB million) 2001 2002 2003 Net Interest Income 3,866 6,062 6,491 Comm & Fee Income 2,082 2,253 1,967 Bad debts and doubt accts 300 1,408 16,759 Non-interest Expenses 6,557 7,540 7,357 Net Income / (loss) 655 (1
Slide 16: Partnership with a renewed TMB
Partnership with a renewed TMB Successful recapitalization Completed a THB 22.4 billion Rights Issue in September 2003 TMB’s THB 13.2 billion SuperCAPS redeemed in December 2003 Expensive THB 6 billion sub-debt 2006 redeemed in November 2003 Significant provisioning in Q3 2003 Asset resolution
Slide 17: Transaction structured as Tender Offer followed by Section 38 Asset Transfer
Transaction will be structured as a Tender Offer by TMB for DTDB to be followed by a Section 38 Asset Transfer Tender Offer followed by a Section 38 Asset Transfer Step 1: Tender Offer Step 2: Section 38 Asset Transfer MOF DBS MOF DBS nt , rra res s wa h a S TMB Assets of DTDB TMB DTDB to be transfe
Slide 18: DBS to support TMB/DTDB through technical services agreements
DBS to support TMB/DTDB through technical services agreements Consumer Upgrade skills, leverage customer base and focus on Banking identified product winners to create a profitable consumer franchise Upgrade specialized expertise to better serve Sources of synergies customers SME Cross-selling
Slide 19: Key sources of synergies
Key sources of synergies Targeted Targeted total total synergies synergies of of THB THB 1,350 1,350 -- THB THB 1,850 1,850 million million Sales of treasury products into SME customer base Cross-selling via more focused consumer segmentation Revenues Greater development of bancassurance and a
Slide 20: DBS Group Holdings
Growing competitive options in Thailand 28 January 2004 DBS Group Holdings Presentation to Media and Analysts Disclaimer: The information contained in this document is intended only for use during the presentation and should not be disseminated or distributed to parties outside the presentation. DBS
DBS Group Holdings — Merger or Acquisition (January 2004) on 6ix