KASIKORNBANK PUBLIC COMPANY LIMITED and Its Subsidiaries
Interim financial statements
For the three-month period ended 31 March 2016
and
Independent Auditor’s Report
On Review of Interim Financial Information
Independent Auditor’s Report on Review of Interim Financial Information
To the Board of Directors of KASIKORNBANK PUBLIC COMPANY LIMITED
I have reviewed the accompanying consolidated and the Bank-only statements of financial position of
KASIKORNBANK PUBLIC COMPANY LIMITED and its subsidiaries, and of KASIKORNBANK PUBLIC
COMPANY LIMITED, respectively, as at 31 March 2016; the consolidated and the Bank-only statements
of profit or loss and other comprehensive income for the three-month period ended 31 March 2016,
changes in equity and cash flows for the three-month period ended 31 March 2016; and condensed
notes (“interim financial information”). The Bank’s management is responsible for the preparation and
presentation of this interim financial information in accordance with Thai Accounting Standard 34,
“Interim Financial Reporting”. My responsibility is to express a conclusion on this interim financial
information based on my review.
Scope of Review I conducted my review in accordance with the Thai Standard on Review Engagements 2410, “Review of
Interim Financial Information Performed by the Independent Auditor of the Entity”. A review of interim
financial information consists of making inquiries, primarily of persons responsible for financial and
accounting matters, and applying analytical and other review procedures. A review is substantially less
in scope than an audit conducted in accordance with Thai Standards on Auditing and consequently does
not enable me to obtain assurance that I would become aware of all significant matters that might be
identified in an audit. Accordingly, I do not express an audit opinion.
2
Conclusion Based on my review, nothing has come to my attention that causes me to believe that the
accompanying interim financial information is not prepared, in all material respects, in accordance
with Thai Accounting Standard 34, “Interim Financial Reporting”.
(Charoen Phosamritlert)
Certified Public Accountant
Registration No. 4068
KPMG Phoomchai Audit Ltd.
Bangkok
10 May 2016
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES
STATEMENTS OF FINANCIAL POSITION
Thousand Baht
Note
31 March 2016
(Unaudited)
31 December 2015 31 March 2016
(Unaudited)
31 December 2015
Cash 45,579,375 56,226,230 45,511,133 56,203,527
Interbank and money market items - net 402,744,003 308,744,496 392,703,784 298,523,171
Claims on security 1,072 1,288 - -
Derivative assets 30,737,089 31,830,604 31,090,030 32,513,462
Investments - net 6 482,343,682 477,200,035 201,765,788 213,198,650
Investments in subsidiaries and associates - net 7 690,233 662,368 14,405,021 14,475,750
Loans to customers and accrued interest receivables - net 8 , 9
Loans to customers 1,623,036,872 1,619,526,585 1,590,715,849 1,588,064,981
Accrued interest receivables 3,134,859 3,088,273 2,733,726 2,706,922
Total Loans to customers and accrued interest receivables 1,626,171,731 1,622,614,858 1,593,449,575 1,590,771,903
Less Deferred revenue (9,459,460) (9,639,590) (264,244) (293,927)
Less Allowance for doubtful accounts 10 (68,199,942) (60,901,538) (66,188,696) (59,135,674)
Less Revaluation allowance for debt restructuring 11 (3,318,994) (3,415,769) (3,318,981) (3,415,756)
The BankConsolidated
ASSETS
Total Loans to customers and accrued interest receivables - net 1,545,193,335 1,548,657,961 1,523,677,654 1,527,926,546
Customers' liability under acceptances 221,218 130,862 221,218 130,862
Properties foreclosed - net 14,754,541 14,196,584 14,414,432 13,865,038
Premises and equipment - net 13 50,022,717 45,284,434 41,605,589 36,850,925
Goodwill and other intangible assets - net 23,856,143 24,234,227 19,159,136 19,538,162
Deferred tax assets 14 4,308,436 5,584,612 3,503,842 4,614,921
Collateral per credit support annex 10,587,793 13,861,552 10,587,793 13,861,552
Other assets - net 32,668,980 28,690,119 15,238,594 16,564,302
Total Assets 2,643,708,617 2,555,305,372 2,313,884,014 2,248,266,868
The accompanying notes are an integral part of these interim financial statements. 3
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES
STATEMENTS OF FINANCIAL POSITION
Thousand Baht
Note
31 March 2016
(Unaudited)
31 December 2015 31 March 2016
(Unaudited)
31 December 2015
The BankConsolidated
Deposits 1,747,634,428 1,705,379,017 1,750,401,986 1,708,593,777
Interbank and money market items 76,070,191 71,465,737 89,497,312 81,844,870
Liabilities payable on demand 27,440,298 23,545,166 27,439,598 23,544,465
Liabilities to deliver security 73,812 121,282 - -
Financial liabilities designated at fair value through profit or loss 21,446 38,890 21,446 38,890
Derivative liabilities 33,243,461 33,570,889 32,067,624 31,703,137
Debts issued and borrowings 89,675,851 85,577,772 89,441,245 85,382,126
Bank's liability under acceptances 221,218 130,862 221,218 130,862
Provisions 15 24,086,056 21,586,936 23,188,341 20,767,651
Deferred tax liabilities 14 1,899,734 1,907,000 - -
Insurance contract liabilities 16 267,628,659 251,447,597 - -
Other liabilities 57,314,331 48,321,275 35,333,995 32,307,029
Total Liabilities 2,325,309,485 2,243,092,423 2,047,612,765 1,984,312,807
LIABILITIES AND EQUITY
Equity
Share capital 17
Authorized share capital
3,048,614,697 common shares, Baht 10 par value 30,486,147 30,486,147 30,486,147 30,486,147
Issued and paid-up share capital
2,393,260,193 common shares, Baht 10 par value 23,932,602 23,932,602 23,932,602 23,932,602
Premium on common shares 18,103,110 18,103,110 18,103,110 18,103,110
Other reserves 19,273,102 14,843,155 16,760,584 12,924,550
Retained earnings
Appropriated
Legal reserve 3,050,000 3,050,000 3,050,000 3,050,000
Unappropriated 225,361,186 225,870,851 204,424,953 205,943,799
Total Equity attributable to equity holders of the Bank 289,720,000 285,799,718 266,271,249 263,954,061
Non-controlling interests 28,679,132 26,413,231 - -
Total Equity 318,399,132 312,212,949 266,271,249 263,954,061
Total Liabilities and Equity 2,643,708,617 2,555,305,372 2,313,884,014 2,248,266,868
(Mr. Banthoon Lamsam) (Ms. Kattiya Indaravijaya)Chairman of the Board and Chief Executive Officer President
The accompanying notes are an integral part of these interim financial statements. 4
For the three-month period ended 31 March For the three-month period ended 31 March
Note 2016 2015 2016 2015
Interest income 23 28,786,621 28,530,639 25,193,002 25,511,804
Interest expenses 24 6,587,047 7,555,671 6,575,937 7,534,210
Interest income - net 22,199,574 20,974,968 18,617,065 17,977,594
Fees and service income 12,087,342 11,272,518 12,404,552 11,357,413
Fees and service expenses 2,366,426 2,239,891 2,358,545 2,217,467
Fees and service income - net 9,720,916 9,032,627 10,046,007 9,139,946
Gain on trading and foreign exchange transactions 2,128,579 2,187,289 2,130,470 2,191,490
Loss on financial liabilities designated at fair value through profit or loss (380) (282) (380) (282)
Gain on investments 25 926,342 286,915 963,171 63,881
Share of profit from investments using equity method 32,391 26,703 - -
Dividend income 434,630 433,011 742,508 373,743
Net premiums earned 26,225,806 22,822,829 - -
Other operating income 897,995 347,426 1,990,521 1,207,775
Total operating income 62,565,853 56,111,486 34,489,362 30,954,147
Underwriting expenses 22,814,379 19,852,182 - -
Total operating income - net 39,751,474 36,259,304 34,489,362 30,954,147
Other operating expenses
Employee's expenses 7,457,659 7,141,472 5,598,596 5,443,211
Directors' remuneration 17,538 15,526 10,443 8,781
Premises and equipment expenses 2,759,950 3,185,819 2,817,695 3,121,634
Taxes and duties 1,102,699 1,049,996 993,653 963,916
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIESSTATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
(UNAUDITED)Thousand Baht
Consolidated The Bank
The accompanying notes are an integral part of these interim financial statements. 5
Others 3,455,596 4,024,011 3,432,283 4,017,780
Total other operating expenses 14,793,442 15,416,824 12,852,670 13,555,322
Impairment loss on loans and debt securities 11,293,287 4,006,724 11,078,325 3,807,837
Operating profit before income tax expense 13,664,745 16,835,756 10,558,367 13,590,988
Income tax expense 2,716,515 3,320,877 1,945,066 2,640,799
Net profit 10,948,230 13,514,879 8,613,301 10,950,189
Other comprehensive income
Items that will be reclassified subsequently to profit or loss
Gain on remeasurement of available-for-sale investments 2,277,794 190,760 329,544 15,348
Loss arising from translating the financial statements of a foreign
operation 26 (112,412) (70,345) (115,781) (55,565)
Income taxes relating to components of other comprehensive income (457,207) (14,560) (67,218) (2,034)
Items that will not be reclassified subsequently to profit or loss
Changes in revaluation surplus 13 4,660,080 - 4,660,080 -
Actuarial losses on defined benefit plans 15 (2,250,000) (66,755) (2,250,000) -
Share of other comprehensive income of associates - (398) - -
Income taxes relating to components of other comprehensive income (482,016) (13,431) (482,016) -
Total other comprehensive income 3,636,239 25,271 2,074,609 (42,251) Total comprehensive income 14,584,469 13,540,150 10,687,910 10,907,938
Net profit attributable to :
Equity holders of the Bank 9,646,092 12,401,332 8,613,301 10,950,189
Non-controlling interests 1,302,138 1,113,547 - -
Total comprehensive income attributable to :
Equity holders of the Bank 12,314,845 12,377,345 10,687,910 10,907,938
Non-controlling interests 2,269,624 1,162,805 - -
Earnings per share of equity holders of the BankBasic earnings per share (Baht) 17 4.03 5.18 3.60 4.58
Weighted average number of common shares (Thousand shares) 2,393,260 2,393,260 2,393,260 2,393,260
(Mr. Banthoon Lamsam) (Ms. Kattiya Indaravijaya)
Chairman of the Board and Chief Executive Officer President
The accompanying notes are an integral part of these interim financial statements. 5
Note Non-controlling Total Issued and Premium on Total equity Interests
Paid-up Share Share Capital Appraisal Revaluation Foreign Total Appropriated Unappropriated attributable to equityCapital Surplus on Surplus on Currency other Legal Reserve holders of the Bank
Asset Revaluation Available-for-sale Translation reservesInvestments (Note 26)
Three-month period ended 31 March 2015Balance at 1 January 2015 23,932,602 18,103,110 9,777,987 5,813,751 231,367 15,823,105 3,050,000 196,150,422 257,059,239 23,626,615 280,685,854
Net profit - - - - - - - 12,401,332 12,401,332 1,113,547 13,514,879 Other comprehensive income - - - 67,020 (69,310) (2,290) - (21,697) (23,987) 49,258 25,271 Total comprehensive income - - - 67,020 (69,310) (2,290) - 12,379,635 12,377,345 1,162,805 13,540,150
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIESSTATEMENTS OF CHANGES IN EQUITY
(UNAUDITED)
Other reserves Retained EarningsEquity holders of the Bank
ConsolidatedThousand Baht
Transferred to retained earnings - - (28,109) - - (28,109) - 28,109 - - - Others - - - - - - - 249 249 - 249
Balance at 31 March 2015 23,932,602 18,103,110 9,749,878 5,880,771 162,057 15,792,706 3,050,000 208,558,415 269,436,833 24,789,420 294,226,253
Three-month period ended 31 March 2016Balance at 1 January 2016 23,932,602 18,103,110 9,663,990 5,233,877 (54,712) 14,843,155 3,050,000 225,870,851 285,799,718 26,413,231 312,212,949 Dividend paid 18 - - - - - - - (8,376,411) (8,376,411) - (8,376,411)
Net profit - - - - - - - 9,646,092 9,646,092 1,302,138 10,948,230 Other comprehensive income - - 3,728,064 854,411 (113,722) 4,468,753 - (1,800,000) 2,668,753 967,486 3,636,239 Total comprehensive income - - 3,728,064 854,411 (113,722) 4,468,753 - 7,846,092 12,314,845 2,269,624 14,584,469
Transferred to retained earnings - - (38,806) - - (38,806) - 38,806 - - - Others - - - - - - - (18,152) (18,152) (3,723) (21,875)
Balance at 31 March 2016 23,932,602 18,103,110 13,353,248 6,088,288 (168,434) 19,273,102 3,050,000 225,361,186 289,720,000 28,679,132 318,399,132
The accompanying notes are an integral part of these interim financial statements. 6
NoteIssued and Premium on Total
Paid-up Share Share Capital Appraisal Revaluation Foreign Total Appropriated UnappropriatedCapital Surplus on Surplus on Currency other Legal Reserve
Asset Revaluation Available-for-sale Translation reservesInvestments (Note 26)
Three-month period ended 31 March 2015Balance at 1 January 2015 23,932,602 18,103,110 9,193,899 3,712,528 228,908 13,135,335 3,050,000 181,221,507 239,442,554
Net profit - - - - - - - 10,950,189 10,950,189 Other comprehensive income - - - 12,278 (54,529) (42,251) - - (42,251) Total comprehensive income - - - 12,278 (54,529) (42,251) - 10,950,189 10,907,938
Retained Earnings
Thousand BahtThe Bank
Equity holders of the BankOther reserves
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIESSTATEMENTS OF CHANGES IN EQUITY
(UNAUDITED)
Transferred to retained earnings - - (27,877) - - (27,877) - 27,877 -
Balance at 31 March 2015 23,932,602 18,103,110 9,166,022 3,724,806 174,379 13,065,207 3,050,000 192,199,573 250,350,492
Three-month period ended 31 March 2016Balance at 1 January 2016 23,932,602 18,103,110 9,080,843 3,874,271 (30,564) 12,924,550 3,050,000 205,943,799 263,954,061 Dividend paid 18 - - - - - - - (8,376,411) (8,376,411)
Net profit - - - - - - - 8,613,301 8,613,301 Other comprehensive income - - 3,728,064 263,635 (117,090) 3,874,609 - (1,800,000) 2,074,609 Total comprehensive income - - 3,728,064 263,635 (117,090) 3,874,609 - 6,813,301 10,687,910
Transferred to retained earnings - - (38,575) - - (38,575) - 38,575 - Others - - - - - - - 5,689 5,689
Balance at 31 March 2016 23,932,602 18,103,110 12,770,332 4,137,906 (147,654) 16,760,584 3,050,000 204,424,953 266,271,249
(Mr. Banthoon Lamsam) (Ms. Kattiya Indaravijaya)Chairman of the Board and Chief Executive Officer President
The accompanying notes are an integral part of these interim financial statements. 7
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES
STATEMENTS OF CASH FLOWS
For the three-month period ended 31 March For the three-month period ended 31 March
Note 2016 2015 2016 2015
CASH FLOWS FROM OPERATING ACTIVITIES
Operating profit before income tax expense 13,664,745 16,835,756 10,558,367 13,590,988
Add (Less) Adjustments to reconcile operating profit before income tax expense to
net cash from operating activities
Depreciation and amortisation 1,884,082 1,583,274 1,712,895 1,431,700
Bad debt and doubtful accounts 10,618,934 3,899,136 10,321,476 3,683,599
Loss on debt restructuring 870,763 209,612 870,763 209,612
Interest income from amortisation of revaluation allowance for debt restructuring (286,569) (111,943) (286,569) (111,943)
Loss (Gain) on foreign exchange translation of long-term borrowings 19,155 (437) 19,155 (437)
Gain on revaluation of trading investments (81,410) (15,465) (74,751) (22,860)
Reversal of loss on impairment of investments (59,484) - (171,719) -
Gain on disposal of investments securities (926,053) (286,780) (762,750) (63,881)
Gain on liquidation of subsidiaries - - (28,703) -
Gain on disposal of investments in associated company (288) (134) - -
(Reversal) Loss on impairment of properties foreclosed (1,227) 34,955 - 31,638
Provision for other assets 80,242 565,053 80,242 565,053
Loss (Gain) on disposal of premises and equipment 557 (494) (175) (1,107)
Loss on write off of premises and equipment 1 281 474 1 281 26
(UNAUDITED)
Thousand Baht
Consolidated The Bank
Loss on write off of premises and equipment 1,281 474 1,281 26
Loss on write off of other assets 1,112 13,176 1,112 12,749
Reversal of loss on revaluation of premises (109,729) - (109,729) -
Share of profit from investments using equity method (32,391) (26,703) - -
25,643,720 22,699,480 22,130,895 19,325,137
Interest income - net (22,199,574) (20,974,968) (18,617,065) (17,977,594)
Dividend income (434,630) (433,011) (742,508) (373,743)
Proceeds from interest 28,095,399 28,442,989 25,468,681 26,388,026
Interest paid (7,487,847) (8,179,058) (7,444,039) (8,137,171)
Proceeds from dividends 196,587 190,165 718,456 348,946
Income tax paid (348,389) (322,627) (238,324) (215,283)
Profit from operating before changes in operating assets and liabilities 23,465,266 21,422,970 21,276,096 19,358,318
(Increase) Decrease in operating assets
Interbank and money market items (assets) (96,223,048) (92,671,198) (96,341,633) (85,726,253)
Investments held for trading (17,311,261) (1,490,834) (17,056,238) (1,541,401)
Loans to customers (9,173,069) (24,136,148) (7,850,739) (22,793,605)
Properties foreclosed 693,202 801,477 587,981 717,025
Other assets 1,154,531 657,054 5,457,011 1,737,102
The accompanying notes are an integral part of these interim financial statements. 8
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES
STATEMENTS OF CASH FLOWS
For the three-month period ended 31 March For the three-month period ended 31 March
Note 2016 2015 2016 2015
(UNAUDITED)
Thousand Baht
Consolidated The Bank
Increase (Decrease) in operating liabilities
Deposits 42,353,461 23,689,696 41,884,215 23,341,615
Interbank and money market items (liabilities) 5,631,424 36,088,716 8,675,280 29,962,042
Liabilities payable on demand 3,895,132 3,010,995 3,895,133 3,010,987
Financial liabilities designated at fair value through profit or loss (17,444) 290,472 (17,444) 290,472
Short-term debts issued and borrowings 5,000,375 (2,089,599) 4,961,415 (2,067,420)
Other accrued expenses (4,488,334) (4,428,540) (3,766,587) (3,517,617)
Provisions 249,125 397,335 170,695 370,086
Other liabilities 28,367,892 14,021,886 7,118,263 (1,301,324)
Net cash used in operating activities (16,402,748) (24,435,718) (31,006,552) (38,159,973)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from disposal of available-for-sale investments 55,612,274 66,576,581 51,237,382 64,453,234
Proceeds from redemption of held-to-maturity debt instruments 15,673,502 18,547,927 14,164,582 5,198,552
Proceeds from disposal of general investments 961,568 97,843 959,466 93,405
Proceeds from capital decrease in subsidiary - - 190,000 200,000
Proceeds from liquidation of subsidiaries - - 4,530,660 -
Proceeds from disposal of investments in associated company 1,088 934 - -
Purchase of available-for-sale investments (35 174 433) (50 497 239) (31 495 411) (46 436 528) Purchase of available for sale investments (35,174,433) (50,497,239) (31,495,411) (46,436,528)
Purchase of held-to-maturity debt instruments (21,380,632) (24,646,694) (5,000,000) -
Purchase of investments in subsidiary - - (4,498,272) -
Proceeds from disposal of premises and equipment 6,618 1,541 219 1,909
Purchase of premises and equipment (1,132,080) (1,253,661) (993,616) (1,046,753)
Purchase of leasehold (612) (171,787) (643) (137,580)
Purchase of intangible assets (429,816) (745,826) (396,479) (694,805)
Net cash provided by investing activities 14,137,477 7,909,619 28,697,888 21,631,434
CASH FLOWS FROM FINANCING ACTIVITIES
Decrease in long-term debts issued and borrowings (7,318) (12,786) (7,318) (12,786)
Dividend paid to shareholders 18 (8,376,411) - (8,376,411) -
Net cash used in financing activities (8,383,729) (12,786) (8,383,729) (12,786)
Effect of exchange rate changes on balances held in foreign currencies 2,145 1 (1) 1
Net decrease in cash (10,646,855) (16,538,884) (10,692,394) (16,541,324)
Cash at the beginning of the period 5 56,226,230 58,005,650 56,203,527 57,997,253
Cash at the end of the period 5 45,579,375 41,466,766 45,511,133 41,455,929
(Mr. Banthoon Lamsam) (Ms. Kattiya Indaravijaya)
Chairman of the Board and Chief Executive Officer President
The accompanying notes are an integral part of these interim financial statements. 9
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
10
Note Contents Page 1 General information 11
2 Basis of preparation of the interim financial statements 11
3 Significant accounting policies 12
4 Capital requirements 13
5 Supplementary information of cash flows 15
6 Investments - net 16
7 Investments in subsidiaries and associated companies - net 22
8 Loans to customers and accrued interest receivables - net 24
9 Troubled debt restructuring 29
10 Allowance for doubtful accounts 33
11 Revaluation allowance for debt restructuring 34
12 Classified assets 35
13 Premises and equipment – net 36
14 Deferred tax assets and deferred tax liabilities 37
15 Employee retirement benefits 37
16 Insurance contract liabilities 37
17 Share capital and earnings per share 38
18 Dividend payments 38
19 Assets pledged as collateral 38
20 Contingent liabilities and commitments 39
21 Related party transactions and balances 40
22 Segment information 43
23 Interest income 46
24 Interest expenses 46
25 Gain on investments 47
26 Gain (loss) arising from translating the financial statements of a foreign operation 48
27 Fair value of assets and liabilities 49
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
11
These notes form an integral part of the interim financial statements.
The interim financial statements issued for Thai statutory and regulatory reporting purposes are prepared in the Thai language.
These English language interim financial statements have been prepared from the Thai language statutory interim financial
statements, and were approved and authorised for issue by the Audit Committee on 10 May 2016.
1 GENERAL INFORMATION
KASIKORNBANK PUBLIC COMPANY LIMITED, (“the Bank”), is a registered public company located in the Kingdom of
Thailand and listed on the Stock Exchange of Thailand on 9 February 1976. The registered office of the Bank is at 1 Soi
Rat Burana 27/1, Rat Burana Road, Rat Burana Sub-District, Rat Burana District, Bangkok.
The principal activity of the Bank is commercial banking and the Bank conducts its businesses through a network of
branches covering all parts of Thailand and certain major cities overseas.
Details of the Company’s subsidiaries and associated companies as at 31 March 2016 and 31 December 2015 are given
in note 7 to the interim financial statements.
2 BASIS OF PREPARATION OF THE INTERIM FINANCIAL STATEMENTS
a) Statement of compliance
The interim financial statements are prepared on a condensed basis in accordance with Thai Accounting Standard
(TAS) No.34 (revised 2015) Interim Financial Reporting, guidelines promulgated by the Federation of Accounting
Professions (“FAP”), applicable rules and regulations of the Securities and Exchange Commission (“SEC”), and the
Stock Exchange of Thailand (“SET”), and with the Bank of Thailand (“BoT”) notification number SOR NOR SOR
21/2558, directive dated 4 December 2015, regarding the “Preparation and announcement of the financial statements
of commercial banks and holding companies which are a parent company of a group of companies offering financial
services”, and other supplementary BoT notifications.
The interim financial statements are prepared to provide an update on the financial statements for the year ended
31 December 2015. They do not include all of the financial information required for full annual financial statements but
focus on new activities, events and circumstances to avoid repetition of information previously reported. Accordingly,
these interim financial statements should be read in conjunction with the financial statements of the Bank and its
subsidiaries for the year ended 31 December 2015.
The Bank and its subsidiaries have adopted all the new and revised TFRS that are effective for annual periods
beginning on or after 1 January 2016. The adoption of these new and revised TFRS did not have an impact on the
accounting policies, methods of computation, financial position or performance of the Bank and its subsidiaries.
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
12
b) Functional and presentation currencies
The interim financial statements are prepared and presented in Thai Baht, which is the Bank’s functional currency. All
financial information is presented in Thai Baht and has been rounded in the interim financial statements to the nearest
thousand and in the notes to the interim financial statements to the nearest million unless otherwise stated.
c) Use of estimates and judgements
The preparation of interim financial statements in conformity with TFRS requires management to make judgments,
estimates and assumptions that affect the application of accounting policies and the reported amounts of assets,
liabilities, income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which estimates are revised and in any future period affected.
In preparing these interim financial statements, the significant judgments made by management in applying the Bank
and its subsidiaries’ accounting policies and the key sources of estimation uncertainty were the same as those applied
to the financial statements for the year ended 31 December 2015.
d) Basis of consolidation
The consolidated financial statements relate to the Bank and its subsidiaries and the Bank’s interests in associates.
Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income or expenses arising from intra-group transactions,
are eliminated in preparing the consolidated financial statements. Unrealised gains arising from transactions with
associates are eliminated against the investment to the extent of the Bank and its subsidiaries’ interest in the investee.
Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence
of impairment.
The consolidated and the Bank only financial statements include the accounts of all branches; domestic and
outside Thailand. Interbranch transactions have been eliminated.
3 SIGNIFICANT ACCOUNTING POLICIES
Accounting policies and methods of computation applied by the Bank and its subsidiaries in the interim financial
statements for the three-month period ended 31 March 2016 are consistent with those applied in the financial statements
for the year ended 31 December 2015.
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
13
4 CAPITAL REQUIREMENTS
The ratios of capital to assets (Capital Adequacy Ratio) of KASIKORNBANK FINANCIAL CONGLOMERATE and The Bank
as of 31 March 2016 and 31 December 2015 are set out below. The Bank has chosen to adopt the Standardized
Approach in accordance with Bank of Thailand (“BoT”) requirements, which is in line with the requirements of Basel III.
(Million Baht)
KASIKORNBANK FINANCIAL
CONGLOMERATE
31 March 2016 31 December 2015
Tier 1 Capital
Common Equity Tier 1 (CET1)
Issued and paid-up share capital, premium on common shares 42,036 42,036
Legal reserves 3,050 3,050
Net profit after appropriation 217,494 210,493
Other comprehensive income 15,307 14,642
Less Capital deduction items on CET1 (21,238) (18,555)
Total Tier 1 Capital Base 256,649 251,666
Tier 2 Capital
Subordinated debentures 42,500 42,500
General Provision 19,030 19,166
Less Capital deduction items on Tier 2 (1,569) (1,480)
Total Tier 2 Capital Base 59,961 60,186
Total Capital Base 316,610 311,852
Total Risk-Weighted Assets 1,724,583 1,732,067
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
14
(Percentage)
KASIKORNBANK FINANCIAL CONGLOMERATE
Capital Adequacy Ratio
BoT regulatory
minimum requirement
and conservation buffer* 31 March 2016
BoT regulatory
minimum
requirement
31 December 2015
Tier 1 Capital ratio 6.625 14.88 6.00 14.53
Common Equity Tier 1 ratio 5.125 14.88 4.50 14.53
Tier 2 Capital ratio - 3.48 - 3.47
Capital adequacy ratio 9.125 18.36 8.50 18.00
* Conservation buffer requires additional Common Equity Tier 1 of 0.625% per annum from 1 January 2016 onwards until reaching 2.50% in 2019.
(Million Baht)
The Bank
31 March 2016 31 December 2015
Tier 1 Capital
Common Equity Tier 1 (CET1)
Issued and paid-up share capital, premium on common shares 42,036 42,036
Legal reserves 3,050 3,050
Net profit after appropriation 197,567 193,145
Other comprehensive income 12,991 12,892
Less Capital deduction items on CET1 (18,823) (16,416)
Total Tier 1 Capital Base 236,821 234,707
Tier 2 Capital
Subordinated debentures 42,500 42,500
General Provision 18,741 18,919
Total Tier 2 Capital Base 61,241 61,419
Total Capital Base 298,062 296,126
Total Risk-Weighted Assets 1,691,427 1,702,380
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
15
(Percentage)
The Bank
Capital Adequacy Ratio
BoT regulatory
minimum requirement
and conservation buffer* 31 March 2016
BoT regulatory
minimum
requirement 31 December 2015
Tier 1 Capital ratio 6.625 14.00 6.00 13.79
Common Equity Tier 1 ratio 5.125 14.00 4.50 13.79
Tier 2 Capital ratio - 3.62 - 3.60
Capital adequacy ratio 9.125 17.62 8.50 17.39
* Conservation buffer requires additional Common Equity Tier 1 of 0.625% per annum from 1 January 2016 onwards until reaching 2.50% in 2019.
As at 31 March 2016 and 31 December 2015, the Bank and KASIKORNBANK FINANCIAL CONGLOMERATE have no add-on
arising from Single Lending Limit.
5 SUPPLEMENTARY INFORMATION OF CASH FLOWS
Significant non-cash items for the three-month period ended 31 March 2016 and 2015 are as follows:
(Million Baht)
Consolidated The Bank
2016 2015 2016 2015
Revaluation surplus on available-for-sale investments* 854 67 264 12
Appraised surplus on asset revaluation* 3,728 - 3,728 -
The realised portion of the appraised surplus on asset revaluation* (39) (28) (39) (28)
Foreign currency translation* (114) (69) (117) (55)
Actuarial loss on defined benefit plans* (1,800) (56) (1,800) -
Foreclosed properties arising from auction and debt settlement 1,250 596 1,137 529
* net of deferred tax
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
16
6 INVESTMENTS - NET
6.1 Type of investments
Investments consisted of:
(Million Baht)
Consolidated The Bank
31 March
2016
31 December
2015
31 March
2016
31 December
2015
Fair Value Fair Value Fair Value Fair Value
1. Trading investments
1.1 Government and state enterprise securities 25,747 8,607 25,785 8,607
1.2 Private enterprise debt instruments 2,503 2,544 2,503 2,544
1.3 Marketable equity securities - domestic 876 572 87 83
Total 29,126 11,723 28,375 11,234
2. Available-for-sale investments
2.1 Government and state enterprise securities 111,848 147,581 108,861 145,675
2.2 Private enterprise debt instruments 2,133 2,742 1,369 1,986
2.3 Foreign debt instruments 47,039 28,975 32,626 14,497
2.4 Marketable equity securities - domestic 26,086 25,096 2,411 2,136
2.5 Marketable equity securities - overseas 10,530 10,971 3,512 3,684
Total 197,636 215,365 148,779 167,978
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
17
(Million Baht)
Consolidated The Bank
31 March
2016
31 December
2015
31 March
2016
31 December
2015
Cost Value/
Amortised Cost
Value
Cost Value/
Amortised Cost
Value
Cost Value/
Amortised Cost
Value
Cost Value/
Amortised Cost
Value
3. Held-to-maturity debt instruments
3.1 Government and state enterprise securities 185,383 174,370 21,813 30,954
3.2 Private enterprise debt instruments 51,015 58,130 453 453
3.3 Foreign debt instruments 16,744 15,000 - -
3.4 Investments in receivables 1,290 1,304 1,285 1,300
Total 254,432 248,804 23,551 32,707
Less Allowance for impairment (473) (532) (453) (453)
Total 253,959 248,272 23,098 32,254
4. General investments
4.1 Non-marketable equity securities - domestic 1,335 1,552 1,097 1,316
4.2 Non-marketable equity securities - overseas 510 510 510 510
Total 1,845 2,062 1,607 1,826
Less Allowance for impairment (222) (222) (93) (93)
Total 1,623 1,840 1,514 1,733
Total Investments - net 482,344 477,200 201,766 213,199
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
18
6.2 Maturity for debt instruments
The contractual maturity for debt instruments not held for trading is as follows:
(Million Baht)
Consolidated
31 March 2016 31 December 2015
Maturity Maturity
1 year
Over
1 year to
5 years
Over
5 years
Total
1 year
Over
1 year to
5 years
Over
5 years
Total
1. Available-for-sale investments
1.1 Government and state
enterprise securities 95,425 10,941 4,841 111,207 121,534 20,782 4,991 147,307
1.2 Private enterprise debt
instruments 933 474 765 2,172 1,047 973 784 2,804
1.3 Foreign debt instruments 34,215 1,819 10,358 46,392 16,111 1,858 10,610 28,579
Total 130,573 13,234 15,964 159,771 138,692 23,613 16,385 178,690
Add Allowance for revaluation 157 164 974 1,295 165 159 330 654
Less Allowance for impairment - - (46) (46) - - (46) (46)
Total 130,730 13,398 16,892 161,020 138,857 23,772 16,669 179,298
2. Held-to-maturity debt
instruments
2.1 Government and state
enterprise securities 2,168 28,058 155,157 185,383 9,329 28,773 136,268 174,370
2.2 Private enterprise debt
instruments 2,080 8,291 40,644 51,015 2,311 7,747 48,072 58,130
2.3 Foreign debt instruments 305 322 16,117 16,744 110 526 14,364 15,000
2.4 Investments in receivables 128 556 606 1,290 124 543 637 1,304
Total 4,681 37,227 212,524 254,432 11,874 37,589 199,341 248,804
Less Allowance for impairment (5) - (468) (473) (5) - (527) (532)
Total 4,676 37,227 212,056 253,959 11,869 37,589 198,814 248,272
Total Debt Instruments 135,406 50,625 228,948 414,979 150,726 61,361 215,483 427,570
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
19
(Million Baht)
The Bank
31 March 2016 31 December 2015
Maturity Maturity
1 year
Over
1 year to
5 years
Over
5 years
Total
1 year
Over
1 year to
5 years
Over
5 years
Total
1. Available-for-sale investments
1.1 Government and state
enterprise securities 94,325 10,803 3,439 108,567 121,403 20,629 3,593 145,625
1.2 Private enterprise debt
instruments 933 420 46 1,399 1,046 920 46 2,012
1.3 Foreign debt instruments 32,637 - - 32,637 14,495 - - 14,495
Total 127,895 11,223 3,485 142,603 136,944 21,549 3,639 162,132
Add (Less) Allowance for
revaluation 133 39 127 299 134 60 (122) 72
Less Allowance for impairment - - (46) (46) - - (46) (46)
Total 128,028 11,262 3,566 142,856 137,078 21,609 3,471 162,158
2. Held-to-maturity debt
instruments
2.1 Government and state
enterprise securities 203 20,006 1,604 21,813 9,140 20,210 1,604 30,954
2.2 Private enterprise debt
instruments - - 453 453 - - 453 453
2.3 Investments in receivables 123 556 606 1,285 120 543 637 1,300
Total 326 20,562 2,663 23,551 9,260 20,753 2,694 32,707
Less Allowance for impairment - - (453) (453) - - (453) (453)
Total 326 20,562 2,210 23,098 9,260 20,753 2,241 32,254
Total Debt Instruments 128,354 31,824 5,776 165,954 146,338 42,362 5,712 194,412
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
20
6.3 Investments in other companies having a going concern uncertainty
Investments held by the Bank and its subsidiaries in listed companies which meet SET’s criteria for delisting, and are in
default on debt instruments, or companies whose ability to continue as a going concern is uncertain, or unlisted
companies whose financial position and operating results are the same as companies which meet SET’s criteria for
delisting or investments in receivables with uncertainty in settlement or in default, were as follows:
(Million Baht)
31 March 2016
Consolidated The Bank
Cost Value/
Book Value
Fair Value
Allowance for
Impairment
Cost Value/
Book Value
Fair Value
Allowance for
Impairment
1. Listed companies which meet SET’s
criteria for delisting, and are in
default on debt instruments
- Debt instrument 46 - (46) 46 - (46)
2. Companies whose ability to continue
as a going concern is uncertain, or
unlisted companies whose financial
position and operating results are
the same as companies which meet
SET’s criteria for delisting
- Equity security 22 - (22) 22 - (22)
- Debt instrument 453 - (453) 453 - (453)
3. Investments in receivables with
uncertainty in settlement or in default 5 - (5) - - -
Total 526 - (526) 521 - (521)
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
21
(Million Baht)
31 December 2015
Consolidated The Bank
Cost Value/
Book Value
Fair Value
Allowance for
Impairment
Cost Value/
Book Value
Fair Value
Allowance for
Impairment
1. Listed companies which meet SET’s
criteria for delisting, and are in
default on debt instruments
- Debt instrument 46 - (46) 46 - (46)
2. Companies whose ability to continue
as a going concern is uncertain, or
unlisted companies whose financial
position and operating results are
the same as companies which meet
SET’s criteria for delisting
- Equity security 22 - (22) 22 - (22)
- Debt instrument 453 - (453) 453 - (453)
3. Investments in receivables with
uncertainty in settlement or in default 5 - (5) - - -
Total 526 - (526) 521 - (521)
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
22
7 INVESTMENTS IN SUBSIDIARIES AND ASSOCIATED COMPANIES - NET
Details of the Bank’s subsidiaries and associated companies are as follows:
% Shareholding of the Bank
Direct and Indirect
31 March 2016 31 December 2015 Investments in subsidiaries
KASIKORN ASSET MANAGEMENT CO., LTD. 100.00 100.00
KASIKORN RESEARCH CENTER CO., LTD. 100.00 100.00
KASIKORN SECURITIES PCL (“KSecurities”) 99.99 99.99
KASIKORN LEASING CO., LTD. 100.00 100.00
KASIKORN FACTORY & EQUIPMENT CO., LTD. 100.00 100.00
KASIKORN TECHNOLOGY GROUP SECRETARIAT COMPANY LIMITED 100.00 100.00
KASIKORN LABS COMPANY LIMITED 100.00 100.00
KASIKORN SOFT COMPANY LIMITED 100.00 100.00
KASIKORN PRO COMPANY LIMITED 100.00 100.00
KASIKORN SERVE COMPANY LIMITED 100.00 100.00
Muang Thai Group Holding Co., Ltd. (“MTGH”)* 51.00 51.00
Muang Thai Life Assurance PCL (“MTL”)* 38.25 38.25
KASIKORNTHAI BANK Limited 100.00 100.00
KHAO KLA Venture Capital Management Co., Ltd. 100.00 100.00
K-SME Venture Capital Co., Ltd. 100.00 100.00
Phethai Asset Management Co., Ltd. (“Phethai Asset Management”) 100.00 100.00
Starbright Finance Co., Ltd. 100.00 100.00 PROGRESS PLUS CO., LTD. 100.00 100.00
PROGRESS APPRAISAL CO., LTD. 100.00 100.00 PROGRESS GUNPAI SECURITY GUARD CO., LTD.
(Formerly name PROGRESS GUNPAI CO., LTD.) 100.00 100.00
PROGRESS MANAGEMENT CO., LTD. 100.00 100.00
PROGRESS FACILITIES MANAGEMENT CO., LTD. 100.00 100.00 PROGRESS SERVICE SECURITY GUARD CO., LTD.
(Formerly name PROGRESS SERVICE CO., LTD.) 100.00 100.00
PROGRESS STORAGE CO., LTD. 100.00 100.00
PROGRESS H R CO., LTD. 100.00 100.00
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
23
% Shareholding of the Bank
Direct and Indirect
31 March 2016 31 December 2015
PROGRESS SERVICE SUPPORT CO., LTD. 100.00 100.00
PROGRESS COLLECTION CO., LTD. 100.00 100.00
PROGRESS TRAINING CO., LTD. 100.00 100.00 PROGRESS MULTI INSURANCE BROKER CO., LTD. 100.00 100.00
Thanyathanathavee Co., Ltd.** - 100.00
Thanyathamrongkij Co., Ltd.** - 100.00
Thanyanithiwattana Co., Ltd.** - 100.00
Ruang Khao Phuean Thai Joint Investment Agreement** - 100.00
Muang Thai Broker Co., Ltd. 50.49 50.49
MT Insure Broker Co., Ltd.* 38.25 38.25 Investments in associated companies
Processing Center Co., Ltd. 30.00 30.00
National ITMX Co., Ltd. 22.15 22.15
Sovannaphum Life Assurance PLC 18.74 18.74
* The Bank holds 51% of total issued shares of Muang Thai Group Holding Co., Ltd. and Muang Thai Group Holding Co., Ltd. holds 75% of
total shares issued by Muang Thai Life Assurance PCL. Moreover, MT Insure Broker Co., Ltd. was held 100% of total shares issued by Muang
Thai Life Assurance PCL.
** Thanyathanathavee Co., Ltd., and Thanyathamrongkij Co., Ltd. terminated Ruang Khao Phuean Thai Joint Investment Agreement effective
from 19 January 2016, and Thanyathanathavee Co., Ltd., Thanyathamrongkij Co., Ltd. and Thanyanithiwattana Co., Ltd. have registered for
dissolution and were completely liquidated on 28 March 2016.
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
24
8 LOANS TO CUSTOMERS AND ACCRUED INTEREST RECEIVABLES - NET
Loans to customers and accrued interest receivables - net consisted of:
8.1 Classified by Account Status
(Million Baht)
Consolidated
31 March 2016
Loans and
Accrued Interest
Receivables
Net amount used for
setting the Allowance
for Doubtful Accounts
% Used for setting
the Allowance for
Doubtful Accounts
Allowance for
Doubtful Accounts
1. Minimum reserve under BoT’s Regulations
Pass 1,516,946 534,735 1 5,347
Special Mention 30,506 7,807 2 156
Sub-Standard 12,066 5,621 100 5,621
Doubtful 17,067 7,545 100 7,545
Doubtful of Loss 23,933 11,983 100 11,983
Total 1,600,518 567,691 30,652
2. Excess allowance 37,243
3. Credit balance transaction 1,909 46
4. Loans in life insurance business 14,285 259
Total 1,616,712 68,200
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
25
(Million Baht)
Consolidated
31 December 2015
Loans and
Accrued Interest
Receivables
Net amount used for
setting the Allowance
for Doubtful Accounts
% Used for setting
the Allowance for
Doubtful Accounts
Allowance for
Doubtful Accounts
1. Minimum reserve under BoT’s Regulations
Pass 1,511,028 527,099 1 5,271
Special Mention 35,969 9,723 2 194
Sub-Standard 12,906 5,841 100 5,841
Doubtful 16,490 8,211 100 8,211
Doubtful of Loss 20,241 10,487 100 10,487
Total 1,596,634 561,361 30,004
2. Excess allowance 30,687
3. Credit balance transaction 2,280 46
4. Loans in life insurance business 14,061 164
Total 1,612,975 60,901
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
26
(Million Baht)
The Bank
31 March 2016
Loans and
Accrued Interest
Receivables
Net amount used for
setting the Allowance
for Doubtful Accounts
% Used for setting
the Allowance for
Doubtful Accounts
Allowance for
Doubtful Accounts
1. Minimum reserve under BoT’s Regulations
Pass 1,513,928 625,190 1 6,252 Special Mention 28,059 7,774 2 156 Sub-Standard 11,732 5,601 100 5,601 Doubtful 16,759 7,517 100 7,517 Doubtful of Loss 22,707 11,004 100 11,004 Total 1,593,185 657,086 30,530 2. Excess allowance 35,659 Total 66,189
(Million Baht)
The Bank
31 December 2015
Loans and
Accrued Interest
Receivables
Net amount used for
setting the Allowance
for Doubtful Accounts
% Used for setting
the Allowance for
Doubtful Accounts
Allowance for
Doubtful Accounts
1. Minimum reserve under BoT’s Regulations
Pass 1,509,352 619,409 1 6,194 Special Mention 33,339 9,697 2 194 Sub-Standard 12,500 5,821 100 5,821 Doubtful 16,183 8,184 100 8,184 Doubtful of Loss 19,104 9,596 100 9,596 Total 1,590,478 652,707 29,989 2. Excess allowance 29,146 Total 59,135
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
27
8.2 Non-performing loans (NPL)
Non-performing loans (NPL gross) are defined as sub-standard, doubtful, doubtful of loss and loss loan accounts in
accordance with the BoT’s notification
Non-performing loans, net refers to the non-performing loan value, net of total allowances for doubtful accounts.
In accordance with the BoT’s regulations, commercial banks are required to report the following information:
- Non-performing loans (NPL gross).
- The ratio of NPL gross to total loans.
- Non-performing loans, net (NPL net).
- The ratio of NPL net to total loans after deduction of allowances for doubtful accounts.
The Bank and its subsidiaries showed non-performing loans (including financial institutions) to comply with BoT’s
regulations, summarised as follows:
(Million Baht)
31 March 2016
KASIKORNBANK
Phethai Asset
Management
Other
Consolidated
Non-performing loans, gross
Non-performing loans 51,064 234 1,629 52,927
Total loans used for NPL gross ratio
calculation(1) 1,876,734 236 102,026 1,884,037(2)
Ratio of total loans 2.72 99.14 1.60 2.81
Non-performing loans, net
Non-performing loans 26,698 158 679 27,535
Total loans used for NPL net ratio
calculation(1) 1,852,368 160 101,076 1,858,645(2)
Ratio of total loans 1.44 98.73 0.67 1.48
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
28
(Million Baht)
31 December 2015
KASIKORNBANK
Phethai Asset
Management
Other
Consolidated
Non-performing loans, gross
Non-performing loans 47,645 239 1,606 49,490
Total loans used for NPL gross ratio
calculation(1) 1,824,802 241 102,532 1,830,933(2)
Ratio of total loans 2.61 99.08 1.57 2.70
Non-performing loans, net
Non-performing loans 23,679 162 745 24,586
Total loans used for NPL net ratio
calculation(1) 1,800,836 164 101,671 1,806,029(2)
Ratio of total loans 1.31 98.64 0.73 1.36 (1) Excluding loans from KSecurities and MTL. (2) Excluding loans to and from subsidiaries.
8.3 Non-accrual loans based on the accrual basis
The Bank and its subsidiaries showed non-accrual loans, gross, (including financial institutions) based on the accrual
basis to comply with BoT’s regulations can be summarised as follows:
(Million Baht)
Consolidated The Bank
31 March
2016
31 December
2015
31 March
2016
31 December
2015
Non-accrual loans 133,030 127,705 130,992 125,725
Total loans used for ratio calculation(1) 1,884,037(2) 1,830,933(2) 1,876,734 1,824,802
Percentage of total loans 7.06 6.97 6.98 6.89
(1) Excluding loans from KSecurities and MTL. (2) Excluding loans to and from subsidiaries.
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
29
8.4 Loan to listed companies that meet SET’s criteria for delisting
Loans to listed companies that meet SET’s criteria for delisting were as follows:
(Million Baht)
Consolidated and The Bank
31 March 2016 31 December 2015
Loans and
Accrued
Interest
Receivables
Collateral
Value
Allowance for
Doubtful
Accounts
Loans and
Accrued
Interest
Receivables
Collateral
Value
Allowance for
Doubtful
Accounts
Listed companies which meet SET’s
criteria for delisting 226 123 4 227 122 4
9 TROUBLED DEBT RESTRUCTURING
During the three-month period ended 31 March 2016 and 2015, the Bank and its subsidiaries engaged in debt restructuring
contracts as follows:
(Million Baht) Consolidated The Bank 2016 2015 2016 2015 Total Total Total Total Outstanding
Debt Before Outstanding
Debt Before Outstanding
Debt Before Outstanding
Debt Before Cases Restructuring Cases Restructuring Cases Restructuring Cases Restructuring Debt restructuring contracts that incurred losses 4,603 24,933 2,801 3,696 4,603 24,933 2,801 3,696
Debt restructuring contracts that incurred no losses 20,283 20,947 15,915 5,625 20,283 20,947 15,915 5,625
Total 24,886 45,880 18,716 9,321 24,886 45,880 18,716 9,321
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
30
Losses on debt restructuring for the three-month period ended 31 March 2016 and 2015 were as follows:
(Million Baht) Consolidated Outstanding Debt Transferred Assets Loss on Before After Debt Types of Restructuring Cases Restructuring Restructuring Types Fair Value Restructuring 2016 2015 2016 2015 2016 2015 2016 2015 2016 2015 Transfers of assets 5 4 3 9 - - Cash, land,
premises and investments
2 8 1 1
Changes of repayment conditions 4,593 2,791 24,553 2,891 24,553 2,891
- - - 850 216
Debt restructuring in various forms
5
6
377
796
167
452
Cash, land, premises and investments
210
344
5
232
Total 4,603 2,801 24,933 3,696 24,720 3,343 212 352 856 449
(Million Baht)
The Bank
Outstanding Debt Transferred Assets Loss on
Before After Debt
Types of Restructuring Cases Restructuring Restructuring Types Fair Value Restructuring
2016 2015 2016 2015 2016 2015 2016 2015 2016 2015
Transfers of assets 5 4 3 9 - - Cash, land,
premises and
investments
2 8 1 1
Changes of repayment
conditions
4,593
2,791
24,553
2,891
24,553
2,891
-
-
-
850
216
Debt restructuring in
various forms
5
6
377
796
167
452
Cash, land,
premises and
investments
210
344
5
232
Total 4,603 2,801 24,933 3,696 24,720 3,343 212 352 856 449
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
31
The Bank and its subsidiaries measure the expected recoverable amounts of loans restructured by changing repayment
conditions by using the present value of future cash flows discounted by the market rate.
The terms of debt restructuring agreements with debts which were restructured by changing the repayment conditions and
restructured in various forms and which resulted in losses on debt restructuring during the three-month period ended
31 March 2016 and 2015 are as follows:
(Million Baht)
Consolidated and The Bank
2016 2015
Outstanding Debt Outstanding Debt
Terms of debt
restructuring
agreements Cases
Before
Restructuring
After
Restructuring
End of
period Cases
Before
Restructuring
After
Restructuring
End of
period
Less than 5 years 2,096 3,585 3,375 3,208 2,659 1,344 1,298 1,292
5 to 10 years 1,386 13,580 13,580 12,864 100 2,102 1,804 1,768
Over 10 years 1,116 7,765 7,765 7,501 38 241 241 239
Total 4,598 24,930 24,720 23,573 2,797 3,687 3,343 3,299
The Bank and its subsidiaries recognised interest income from restructured loans for the three-month period ended 31 March
2016 and 2015 as follows:
(Million Baht)
Consolidated The Bank
2016 2015 2016 2015
Debt restructuring contracts that incurred losses 629 265 629 265
The Bank had commitments to extend additional loans to these borrowers as follows:
(Million Baht)
Consolidated and The Bank
31 March 2016 31 December 2015
Debt restructuring contracts that incurred losses 634 484
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
32
The Bank and its subsidiaries had outstanding balances on restructured loans that only incurred losses during the period/year
as follows:
(Million Baht)
Consolidated The Bank
31 March
2016
31 December
2015
31 March
2016
31 December
2015
Debt restructuring contracts which were not classified as NPL 23,474 25,050 23,474 25,050
Debt restructuring contracts which were classified as NPL 99 681 99 681
Total 23,573 25,731 23,573 25,731
The Bank and its subsidiaries had outstanding balances on restructured loans that only incurred losses as follows:
(Million Baht)
Consolidated The Bank
31 March
2016
31 December
2015
31 March
2016
31 December
2015
Debt restructuring contracts which were not classified as NPL 46,322 33,564 46,322 33,563
Debt restructuring contracts which were classified as NPL 1,088 1,513 1,066 1,491
Total 47,410 35,077 47,388 35,054
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
33
10 ALLOWANCE FOR DOUBTFUL ACCOUNTS
The movements in the allowance for doubtful accounts during the period/year were as follows:
(Million Baht)
Consolidated
31 March 2016
Pass
Special
Mention
Sub-
Standard
Doubtful
Doubtful
of Loss
Excess
Allowance
Allowances
from
Securities
Business
Allowances
from
Insurance
Business
Total
Balance at the beginning
of the period 5,271 194 5,841 8,211 10,487 30,687 46 164 60,901
Doubtful accounts 76 (38) (220) (666) 5,020 6,556 - 99 10,827
Bad debt written off - - - - (4,243) - - - (4,243)
Others - - - - 719 - - (4) 715
Balance at the end
of the period 5,347 156 5,621 7,545 11,983 37,243 46 259 68,200
(Million Baht)
Consolidated
31 December 2015
Pass
Special
Mention
Sub-
Standard
Doubtful
Doubtful
of Loss
Excess
Allowance
Allowances
from
Securities
Business
Allowances
from
Insurance
Business
Total
Balance at the beginning
of the year 5,360 154 3,359 4,883 11,766 21,751 45 116 47,434
Doubtful accounts (89) 40 2,482 3,328 9,761 8,936 1 58 24,517
Bad debt written off - - - - (10,160) - - - (10,160)
Others - - - - (880) - - (10) (890)
Balance at the end
of the year 5,271 194 5,841 8,211 10,487 30,687 46 164 60,901
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
34
(Million Baht)
The Bank
31 March 2016
Pass
Special
Mention
Sub-
Standard
Doubtful
Doubtful
of Loss
Excess
Allowance
Total
Balance at the beginning of the period 6,194 194 5,821 8,184 9,596 29,146 59,135 Doubtful accounts 58 (38) (220) (667) 4,884 6,513 10,530 Bad debt written off - - - - (4,195) - (4,195) Others - - - - 719 - 719 Balance at the end of the period 6,252 156 5,601 7,517 11,004 35,659 66,189
(Million Baht)
The Bank
31 December 2015
Pass
Special
Mention
Sub-
Standard
Doubtful
Doubtful
of Loss
Excess
Allowance
Total
Balance at the beginning of the year 6,310 153 3,345 4,868 10,971 20,475 46,122 Doubtful accounts (116) 41 2,476 3,316 9,460 8,671 23,848 Bad debt written off - - - - (9,957) - (9,957) Others - - - - (878) - (878) Balance at the end of the year 6,194 194 5,821 8,184 9,596 29,146 59,135
11 REVALUATION ALLOWANCE FOR DEBT RESTRUCTURING
The movements in the revaluation allowance for debt restructuring during the period/year were as follows:
(Million Baht) Consolidated The Bank 31 March 2016 31 December 2015 31 March 2016 31 December 2015 Balance at the beginning of the period/year 3,416 3,558 3,416 3,558
Increase 870 1,994 870 1,994
Amortisation to interest income (287) (599) (287) (599)
Others (680) (1,537) (680) (1,537)
Balance at the end of the period/year 3,319 3,416 3,319 3,416
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
35
12 CLASSIFIED ASSETS
Assets of the Bank and its subsidiaries, classified as investments, loans and accrued interest receivables (including
financial institutions), properties foreclosed and other assets, were categorised by quality in compliance with the BoT’s
regulations, taking into account analyses of each loan and appraisal of the financial standing of each borrower, as follows:
(Million Baht)
Consolidated
31 March 2016
Investments
Loans and Accrued
Interest Receivables
Properties
Foreclosed
Other Assets
Total
Pass - 1,800,752 - - 1,800,752
Special Mention - 30,358 - - 30,358
Sub-Standard - 12,066 - - 12,066
Doubtful - 17,067 - - 17,067
Doubtful of Loss 706 23,933 511 3,094 28,244
Total 706 1,884,176 511 3,094 1,888,487
(Million Baht)
Consolidated
31 December 2015
Investments
Loans and Accrued
Interest Receivables
Properties
Foreclosed
Other Assets
Total
Pass - 1,745,653 - - 1,745,653
Special Mention - 35,790 - - 35,790
Sub-Standard - 12,906 - - 12,906
Doubtful - 16,490 - - 16,490
Doubtful of Loss 822 20,241 572 3,123 24,758
Total 822 1,831,080 572 3,123 1,835,597
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
36
(Million Baht)
The Bank
31 March 2016
Investments
Loans and Accrued
Interest Receivables
Properties
Foreclosed
Other Assets
Total
Pass - 1,797,758 - - 1,797,758
Special Mention - 27,912 - - 27,912
Sub-Standard - 11,732 - - 11,732
Doubtful - 16,759 - - 16,759
Doubtful of Loss 2,400 22,707 441 3,094 28,642
Total 2,400 1,876,868 441 3,094 1,882,803
(Million Baht)
The Bank
31 December 2015
Investments
Loans and Accrued
Interest Receivables
Properties
Foreclosed
Other Assets
Total
Pass - 1,743,995 - - 1,743,995
Special Mention - 33,162 - - 33,162
Sub-Standard - 12,500 - - 12,500
Doubtful - 16,183 - - 16,183
Doubtful of Loss 2,688 19,104 498 3,123 25,413
Total 2,688 1,824,944 498 3,123 1,831,253
13 PREMISES AND EQUIPMENT – NET
During the period, the Bank completed the revaluation of its lands and buildings and issued such report to the
Bank of Thailand. The appraisal surplus on asset revaluation increased by Baht 4,660 million and the amount was
presented in changes in revaluation surplus in other comprehensive income. There was also a reversal of loss on
revaluation of premises of Baht 110 million. Such reversal was presented in premises and equipment expenses in
profit or loss.
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
37
14 DEFERRED TAX ASSETS AND DEFERRED TAX LIABILITIES
Deferred tax assets and liabilities are as follows:
(Million Baht)
Consolidated The Bank
31 March 2016 31 December 2015 31 March 2016 31 December 2015
Deferred tax assets 4,308 5,585 3,504 4,615 Deferred tax liabilities (1,900) (1,907) - -
Net 2,408 3,678 3,504 4,615
15 EMPLOYEE RETIREMENT BENEFITS
The Bank recognised Baht 2,250 million of actuarial losses from employee retirement benefits due to a change in the
discount rate, assumption for calculation of the Bank’s employee retirement benefits, which was presented in other
comprehensive income.
16 INSURANCE CONTRACT LIABILITIES
Insurance contract liabilities consisted of:
(Million Baht)
Consolidated
31 March 2016 31 December 2015
Long-term technical reserves 263,571 247,900
Others 4,058 3,547
Total 267,629 251,447
Long-term technical reserves
(Million Baht)
Consolidated
31 March 2016
Balance at the beginning of the period 247,900
Reserve increase from new and inforce policies in the period 20,966
Reserve released for benefits payment, lapse and cancellation
in the period
(5,295)
Balance at the end of the period 263,571
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
38
17 SHARE CAPITAL AND EARNINGS PER SHARE
The calculation of the consolidated and the Bank basic earnings per share for the three-month period ended 31 March
2016 was based on profit attributable to ordinary shareholders of Baht 9,646 million and Baht 8,613 million, respectively
(Year 2015: Baht 12,401 million and Baht 10,950 million, respectively) and the weighted average number of ordinary and
paid-up shares outstanding during the three-month period ended 31 March 2016 of 2,393,260,193 shares (Year 2015:
2,393,260,193 shares).
18 DIVIDEND PAYMENTS
On 30 March 2016, the Annual General Meeting of Shareholders of the Bank approved to pay a dividend from the
operating results of 2015 at the rate of Baht 4.00 per share, totaling Baht 9,573 million. The interim dividend was paid at
the rate of Baht 0.50 per share, totaling Baht 1,197 million, on 25 September 2015 and the remaining dividend was paid at
the rate of Baht 3.50 per share, totaling Baht 8,376 million, on 27 April 2016.
19 ASSETS PLEDGED AS COLLATERAL
Assets pledged as collateral consisted of:
(Million Baht)
Consolidated The Bank
31 March 2016 31 December 2015 31 March 2016 31 December 2015
Deposits 11,182 14,231 10,595 13,861
Government bonds 88,695 71,630 18,326 17,897
State enterprise bonds 48 48 48 48
Total 99,925 85,909 28,969 31,806
The Bank has pledged these assets as collateral for derivatives, for electricity consumption, for court collateral and for
repurchase agreements.
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
39
20 CONTINGENT LIABILITIES AND COMMITMENTS
Contingent liabilities and commitments consisted of:
(Million Baht)
Consolidated The Bank
31 March
2016
31 December
2015
31 March
2016
31 December
2015
Avals to bills 4,912 9,210 4,912 9,210
Guarantees of loans 9,575 11,246 9,575 11,246
Liability under unmatured import bills 15,328 15,721 15,328 15,721
Letters of credit 29,188 26,604 29,188 26,604
Other contingencies
- Guarantees of selling instruments or securities - 500 - 500
- Unused credit line of overdraft 240,767 236,400 241,076 236,708
- Other guarantees 246,815 236,767 246,815 236,767
- Others* 57,908 52,117 56,134 50,302
Total 604,493 588,565 603,028 587,058 *Including items contracted but not provided.
Under normal business operations, the Bank is a defendant in various litigations against the Bank. These include cases of
wrongful acts brought against the Bank, with total claims amounting to Baht 6,889 million and Baht 7,488 million as of
31 March 2016 and 31 December 2015, respectively. The Management believes that any liability resulting from these
litigations will not be material to the Bank’s financial position or on the results of its operations.
As of 31 March 2016 and 31 December 2015, Muang Thai Life Assurance Public Company Limited has been sued as
insurer, with claims amounting to approximately Baht 159 million and Baht 174 million, respectively. The Management
believes that any liability resulting from this litigation will not be material to the consolidated financial statements.
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
40
21 RELATED PARTY TRANSACTIONS AND BALANCES
Relationships between the Bank and related persons or entities consisted of subsidiaries, associated companies, key
management personnel(1), any parties related to key management personnel and the entities of which key management
personnel and any parties related have control and significant influence.
Arm’s length transactions occurring between the Bank and related persons or entities are fairly charged at market price as
normal business or the price as stipulated in the agreement.
Related party transactions and balances are as follows:
21.1 Assets, liabilities and contingencies between the Bank and related persons or entities summarised as follows:
(Million Baht) Consolidated The Bank
31 March 2016
31 December 2015
31 March 2016
31 December 2015
Interbank and Money Market Items (Assets) Subsidiaries - - 1,178 911 Loans (Including financial institutions) Subsidiaries - KASIKORN LEASING CO., LTD. - - 83,265 84,756 - Others - - 11,692 11,947 Other Related Entities 10,714 13,978 10,714 13,978 Other Related Persons 87 107 84 104 Other Assets Subsidiaries - - 1,704 1,111 Associated Company 27 40 27 40 Deposits (Including financial institutions) Subsidiaries - - 18,316 18,113 Associated Company 28 35 28 35 Other Related Entities 45,131 48,094 45,131 48,094 Other Related Persons 12,475 4,792 12,461 4,778 Other Liabilities Subsidiaries - - 284 412 Associated Company 13 11 13 11 Other Related Entities 11 89 11 89
(1) Key management means director, management who holds the title of at least First Senior Vice President including Department Head-
Financial Accounting Management Department and Department Head-Financial Planning Department.
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
41
(Million Baht)
Consolidated The Bank
31 March 2016
31 December 2015
31 March 2016
31 December 2015
Contingencies
Subsidiaries - - 1,022 1,355
Other Related Entities 11,183 14,045 11,183 14,045
Other Related Persons 2 2 2 2
Derivatives (notional amount)
Subsidiaries - - 7,752 7,752
Other Related Entities 18,914 10,528 18,914 10,528
Certain subsidiaries and associated companies have entered into 1-2 year building lease and service agreements with
the Bank. Rentals are charged at cost plus an increment for additional administration and maintenance expenditures
incurred. As of 31 March 2016 and 31 December 2015, the Bank and its related parties have rental agreements with
remaining tenures amounting to Baht 74 million and Baht 40 million, respectively.
The Bank have entered into an Information Technology service agreement with Kasikorn Business-Technology Group. As
of 31 March 2016 and 31 December 2015, the Bank has commitment to pay total service fees amounting to Baht 925 million
and Baht 1,146 million, respectively.
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
42
21.2 Revenue and expenses between the Bank and related persons or entities is summarised as follows:
(Million Baht) Consolidated
For the Three-Month Period Ended 31 March
The Bank For the Three-Month Period
Ended 31 March 2016 2015 2016 2015 Interest income Subsidiaries - - 731 841 Other income Subsidiaries - - 4,866 4,105 Associated Company 7 6 7 6 Interest expenses Subsidiaries - - 35 36 Other expenses Subsidiaries - - 1,446 1,246 Associated Company 56 46 56 46
The Bank has entered into a staff secondment agreement with KASIKORN SECURITIES PCL, commencing from January
2006. The agreement shall be terminated at any time by the Bank giving notice 60 days prior to the termination date. The
Bank is responsible for salaries, welfare and other benefits and any liabilities that arise or may arise from the actions of the
employees.
For the three-month period ended 31 March 2016 and 2015, the Bank incurred expenses amounting to Baht 397 million and
Baht 297 million, respectively, presented as personnel expenses in profit or loss.
21.3 Key management personnel(1) compensation
(Million Baht)
Consolidated
For the Three-Month Period
Ended 31 March
The Bank
For the Three-Month Period
Ended 31 March
2016 2015 2016 2015
Short-term employee benefits 378 383 232 247
Post-employment benefits 20 18 15 15
Total 398 401 247 262
(1) Key management means director, management who holds the title of at least First Senior Vice President including Department Head-
Financial Accounting Management Department and Department Head-Financial Planning Department.
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
43
22 SEGMENT INFORMATION
22.1 Information about reportable segments The Group has identified 4 main business groups for management reporting purposes. The business groups offer
different customers different products and services, and the groups’ performance is measured based on segment
operating profit before impairment loss on loans and debt securities and income tax expense.
Corporate Business KBank’s Corporate Business Customers include registered companies and certain private individual business
customers, government agencies, state enterprises, and financial institutions etc. KBank provides a variety of
financial products and services to these customers such as Long Term Loans, Working Capital, Letter of Indemnity,
Trade Finance Solutions, Syndicated Loans, Cash Management Solutions, and Value Chain Solutions.
Retail Business KBank’s Retail Business comprises individual customers who use KBank’s products and services such as Deposit
Account, Debit Card, Credit Card, Personal Loan, Housing Loan, Investment Product and Financial Advisory
Services, and Transactional Banking Services.
Treasury and Capital Markets Business The Treasury and Capital Markets Business comprises the Bank’s treasury and capital markets business with
activities mainly including funding, centralised risk management, investing in liquid assets, and foreign currency
exchange services. It also supervises the Bank’s business in overseas countries.
Muang Thai Group Holding Business Muang Thai Group Holding Business includes a group of companies that operates insurance and brokerage
businesses.
Others represent other items which are not directly attributable to the main business groups.
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
44
(Million Baht) Consolidated March 2016Ended 31 Month Period-ThreeFor the
Corporate Business
Retail Business
Treasury and Capital Markets
Business
Muang Thai Group Holding
Business
Others Elimination Total Interest income - net 10,967 7,051 1,650 2,954 (350) (72) 22,200
Non-interest income 5,913 8,657 1,157 960(1) 2,894 (2,030) 17,551
Total operating income - net 16,880 15,708 2,807 3,914 2,544 (2,102) 39,751
Total other operating expenses 5,339 7,361 468 1,220 1,617 (1,212) 14,793
Operating profit before impairment loss on loans and debt securities and income tax expense 11,541 8,347 2,339 2,694 927 (890) 24,958
Impairment loss on loans and debt securities
11,293
Operating profit before income tax expense
13,665
(Million Baht) Consolidated Month Period Ended 31 March 2015-For the Three
Corporate Business
Retail Business
Treasury and Capital Markets
Business
Muang Thai Group Holding
Business
Others Elimination Total Interest income - net 10,138 6,153 2,076 2,439 238 (69) 20,975
Non-interest income 5,096 8,069 473 923(1) 2,140 (1,417) 15,284
Total operating income - net 15,234 14,222 2,549 3,362 2,378 (1,486) 36,259
Total other operating expenses 5,297 7,775 454 1,098 1,934 (1,141) 15,417
Operating profit before impairment loss on loans and debt securities and income tax expense 9,937 6,447 2,095 2,264 444 (345) 20,842
Impairment loss on loans and debt securities
4,006
Operating profit before income tax expense
16,836
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
45
(Million Baht)
Consolidated
31 March 2016
Corporate
Business
Retail
Business
Treasury and
Capital Markets
Business
Muang Thai
Group Holding
Business
Others Elimination Total
Reportable segment - Loans(2) 1,092,262 416,471 5,804 13,913 180,086 (94,959) 1,613,577
Unallocated assets 1,030,132
Total assets 2,643,709
Deposits and bills of exchange(3) 555,669 1,197,578 6,856 - 218 (3,410) 1,756,911
(Million Baht)
Consolidated
31 December 2015
Corporate
Business
Retail
Business
Treasury and
Capital Markets
Business
Muang Thai
Group Holding
Business
Others Elimination Total
Reportable segment - Loans(2) 1,085,646 422,400 4,825 13,705 179,953 (96,642) 1,609,887
Unallocated assets 945,418
Total assets 2,555,305
Deposits and bills of exchange(3) 524,957 1,178,967 9,622 - 106 (3,964) 1,709,688
(1) Net of underwriting expenses (2) Loans = Loans to customers less deferred revenue (3) Excluding bills of exchange with embedded derivative
22.2 Information about geographical areas
The majority of the Bank’s business is generated from domestic operations. Accordingly, an analysis of
geographical segments is not disclosed.
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
46
23 INTEREST INCOME
Interest income consisted of:
(Million Baht)
Consolidated
For the Three-Month Period
Ended 31 March
The Bank
For the Three-Month Period
Ended 31 March
2016 2015 2016 2015
Interbank and money market items 1,401 752 1,327 647
Investments and trading transactions 62 88 62 88
Investments in debt securities 3,389 3,894 773 1,745
Loans 22,669 22,512 23,030 23,032
Hire purchase and financial lease 1,263 1,285 - -
Others 3 - - -
Total 28,787 28,531 25,192 25,512
24 INTEREST EXPENSES
Interest expenses consisted of:
(Million Baht)
Consolidated
For the Three-Month Period
Ended 31 March
The Bank
For the Three-Month Period
Ended 31 March
2016 2015 2016 2015
Deposits 3,282 4,435 3,282 4,437
Interbank and money market items 454 421 467 425
Contributions to Financial Institutions Development
Fund and Deposit Protection Agency 1,936 1,866 1,936 1,866
Debts issued
- Subordinated debentures 620 499 620 499
- Others 271 307 271 307
Others 24 28 - -
Total 6,587 7,556 6,576 7,534
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
47
25 GAIN ON INVESTMENTS
Gain on investments presented in the statements of profit or loss and other comprehensive income consisted of:
(Million Baht)
Consolidated
For the Three-Month Period
Ended 31 March
The Bank
For the Three-Month Period
Ended 31 March
2016 2015 2016 2015
Gain (loss) on disposal
Available-for-sale investments 246 275 22 53
Held-to-maturity debt instruments (62) - - -
General investments 742 12 741 11
Investments in subsidiaries and associates - - 29 -
Total 926 287 792 64
Reversal on impairment
Investments in subsidiaries and associates - - 172 -
Total - - 172 -
Total gain on investments 926 287 964 64
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
48
26 GAIN (LOSS) ARISING FROM TRANSLATING THE FINANCIAL STATEMENTS OF A FOREIGN OPERATION
Gain (loss) arising from translating the financial statements of a foreign operation consisted of:
(Million Baht)
Consolidated
For the Three-Month Period
Ended 31 March
2016 2015
Loss arising from translating the financial statements of
a foreign operation (486) (201)
Gain from hedging instrument 374 131
Total (112) (70)
(Million Baht)
The Bank
For the Three-Month Period
Ended 31 March
2016 2015
Loss arising from translating the financial statements of
a foreign operation (441) (171)
Gain from hedging instrument 325 116
Total (116) (55)
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
49
27 FAIR VALUE OF ASSETS AND LIABILITIES
The Bank and its subsidiaries measure fair values using the following fair value hierarchy, which reflects the significance
of the inputs used in making the measurements.
Level 1 Quoted prices in active markets for identical assets or liabilities.
Level 2 Inputs other than quoted prices included within level 1 that are observable, either directly or indirectly. This
category includes instruments valued using quoted prices in active markets for similar instruments, quoted
prices for similar assets or liabilities in markets that are less than active, or other valuation techniques which
are directly or indirectly observable from market data.
Level 3 Inputs that are unobservable. This category includes assets or liabilities for which the valuation technique
includes inputs not based on observable data and the unobservable inputs have a significant impact on the valuation.
A transfer between the hierarchy occurs when the source or level of observability of input data in fair value measurement
has changed.
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
50
27.1 Financial assets, financial liabilities, and derivatives measured at fair value
The fair value hierarchy of financial instruments measured at fair value on a recurring basis as of 31 March 2016 and
31 December 2015 are as follows:
(Million Baht)
Consolidated
31 March 2016 31 December 2015
Level 1 Level 2 Total Level 1 Level 2 Total
Financial Assets
Derivative assets
- Exchange rate - 17,779 17,779 - 21,892 21,892
- Interest rate - 11,886 11,886 - 9,132 9,132
- Others 8 250 258 3 359 362
Trading investments 787 28,339 29,126 489 11,234 11,723
Available-for-sale investments 28,459 169,177 197,636 26,809 188,556 215,365
Total Financial Assets 29,254 227,431 256,685 27,301 231,173 258,474
Financial Liabilities
Financial liabilities designated at
fair value through profit or loss - 21 21 - 39 39
Derivative liabilities
- Exchange rate - 18,509 18,509 - 20,939 20,939
- Interest rate - 11,879 11,879 - 8,789 8,789
- Others 23 257 280 15 336 351
Total Financial Liabilities 23 30,666 30,689 15 30,103 30,118
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
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(Million Baht)
The Bank
31 March 2016 31 December 2015
Level 1 Level 2 Total Level 1 Level 2 Total
Financial Assets
Derivative assets
- Exchange rate - 18,162 18,162 - 22,590 22,590
- Interest rate - 11,886 11,886 - 9,132 9,132
- Others - 228 228 - 347 347
Trading investments - 28,375 28,375 - 11,234 11,234
Available-for-sale investments 5,844 142,935 148,779 5,739 162,239 167,978
Total Financial Assets 5,844 201,586 207,430 5,739 205,542 211,281
Financial Liabilities
Financial liabilities designated at
fair value through profit or loss - 21 21 - 39 39
Derivative liabilities
- Exchange rate - 18,944 18,944 - 21,113 21,113
- Interest rate - 11,879 11,879 - 8,789 8,789
- Others - 253 253 - 335 335
Total Financial Liabilities - 31,097 31,097 - 30,276 30,276
During the current period, due to changes in market conditions, there were transfers of financial assets measured at
fair value of the bank’s subsidiaries from level 1 to level 2 amounting to Baht 875 million and transfers from level 2 to
level 1 amounting to Baht 689 million.
The valuation techniques for level 2 of recurring fair value measurements are as follows:
The fair values of derivatives and structure notes are determined based upon liquid (observable) market prices,
reference to exchange traded prices, broker or dealer quotations, prices of other similar transactions or prices
derived by using a valuation technique incorporating observable market data which is adjusted with counterparty
credit risk (excluding own credit risk) and other risks to reflect true economic value.
Investments in marketable equity securities classified as trading investments and available-for-sale investments
considered to be inactive, are stated at fair value based on the last bid prices of the Stock Exchange of Thailand
(SET) or the closing price of the stock exchange they are listed as of the reporting date.
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
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Investments in marketable unit trusts classified as trading investments and available-for-sale investments are stated
at fair value based on the net asset value as of the reporting date.
Investments in government debt securities and state enterprises debt securities guaranteed by the government,
classified as trading investments and available-for-sale investments, are stated at fair value based on the Thai Bond
Market Association Government Bond Yield Curve as of the reporting date. State enterprises debt securities not
guaranteed by the government and private debt instruments are stated at fair value based on bid prices from the
Thai Bond Market Association as of the reporting date. If not available, the Government Bond Yield Curve for the
same period is used, adjusted by an appropriate risk premium.
Investments in marketable foreign bonds classified as available-for-sale investments are stated at fair value based
on bid prices from Bloomberg. If not available, indicative price from custodian is used.
The Bank and its subsidiaries measure the fair value of financial assets separately from financial liabilities. However,
in cases where the Bank and its subsidiaries manage either market risk or credit risk on a portfolio basis, the Bank
and its subsidiaries measure the fair value of those groups of financial instruments on a net basis.
27.2 Financial assets, financial liabilities and derivative are not measured at fair value
Fair value of financial instruments which are not measured at fair value and for which there is a significant difference
with carring value as of 31 March 2016 and 31 December 2015 are as follows:
(Million Baht)
Consolidated
31 March 2016 31 December 2015
Carrying Amount Fair Value Carrying Amount Fair Value
Financial Assets
Derivative assets (Banking book)
- Exchange rate 814 780 445 328
- Interest rate - 459 - 271
Held-to-maturity investments 253,958 302,782 248,272 269,093
Total Financial Assets 254,772 304,021 248,717 269,692
Financial Liabilities
Derivative liabilities (Banking book)
- Exchange rate 2,573 1,833 3,489 3,171
- Interest rate - 332 - 196
Debts issued and borrowings 89,676 92,995 85,578 88,122
Total Financial Liabilities 92,249 95,160 89,067 91,489
KASIKORNBANK PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED 31 MARCH 2016 (UNAUDITED)
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(Million Baht)
The Bank
31 March 2016 31 December 2015
Carrying Amount Fair Value Carrying Amount Fair Value
Financial Assets
Derivative assets (Banking book)
- Exchange rate 814 780 445 328
- Interest rate - 444 - 271
Held-to-maturity investments 23,098 23,214 32,254 32,265
Total Financial Assets 23,912 24,438 32,699 32,864
Financial Liabilities
Derivative liabilities (Banking book)
- Exchange rate 989 1,374 1,463 1,667
- Interest rate - 332 - 193
Debts issued and borrowings 89,441 92,761 85,382 87,927
Total Financial Liabilities 90,430 94,467 86,845 89,787