#1K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KASIKORNBANK Investor Presentation as of 2Q21 August 2021 For further information, please contact the Investor Relations Unit or visit our website at www.kasikornbank.com บริการทุกระดับประทับใจ K KASIKORNTHAI KASIKORNBANK at a Glance ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK ■Established on June 8, 1945 with registered capital of Bt5mn (USD0.16mn) ■Listed on the Stock Exchange of Thailand (SET) since 1976 Consolidated (as of June 2021) Assets Loans* Deposits CAR ROE (1H21) Bt3,887bn (USD121.3bn) Bt2,383bn (USD74.4bn) Bt2,481bn (USD77.4bn) 18.19% *** Ranked #3 with 16.1% market share** Ranked #2 with 17.0% market share** Ranked #3 with 16.8% market share** Member of Dow Jones Sustainability Indices Powered by the Sustainability Award Silver Class 2021 S&P Global FTSE4Good 8.87% **** ROA (1H21) 1.03% Number of Branches 857 Number of E-Machine (ATM/RCM) 10,805 Number of K PLUS Users 15.7mn Number of Employees 19,316 KBANK, KBANK-F Bt30.2bn (USD0.9bn) Share Information SET Symbol Share Capital: Authorized Issued and Paid-up Number of Shares Market Capitalization 2Q21 Avg. Share Price: KBANK KBANK-F EPS (1H21) BVPS (1H21) Notes: Bt23.7bn (USD0.7bn) 2.4bn shares Bt279.6bn (USD8.7bn) Bt127.51 (USD3.98) Bt127.77 (USD3.99) Bt8.10 (USD0.25) Bt186.25 (USD5.81) * Loans Loans to customers less deferred revenue Ranked #2 in Thai banking sector ** Assets, loans and deposits market share is based on C.B.1.1 (Monthly statement of assets and liabilities) of 14 Thai commercial banks as of June 2021 *** Capital Adequacy Ratio (CAR) has been reported in accordance with Basel III Capital Requirement from 1 January 2013 onwards. CAR is based on KASIKORNBANK FINANCIAL CONGLOMERATE. KASIKORNBANK FINANCIAL CONGLOMERATE means the company under the Notification of the Bank of Thailand re: Consolidated Supervision, consisted of KBank, K Companies and subsidiaries operating in supporting KBank, Phethai Asset Management Co., Ltd. and other subsidiaries within the permitted scope from the BOT's to be financial conglomerate **** ROE = Net profit (attributable to equity holders of the Bank) deduct dividend from other equity instruments after income tax divided by average equity of equity excluded other equity instruments Exchange rate at the end of June 2021 (Mid Rate) was Bt32.05 per USD (Source: Bank of Thailand) บริการทุกระดับประทับใจ 1 2#2K KASIKORNTHAI Table of Contents ■ Operating Environment ■2021 Financial Targets ■The K-Strategy Financial Performance ■Capital and Dividend ■Summary ■ Appendix K KASIKORNTHAI Appendix Topic บริการทุกระดับประทับใจ Topic ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Slide Page 5-6 7 8-9 10-16 17-18 19 20 - 164 ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Slide Page KBank Strategy Business Highlights Risk and Credit Management Financial Performance 1H21 Highlights Interest Income - net 21-44 45-53 54-66 67-84 68-70 71 Non-interest Income 72 • Net Fee Income 73-74 Other Operating Expenses 75 Loan 76-77 • Asset Quality 78-80 Investment in Securities and Funding Structure 81-84 The Wholly-owned Subsidiaries 85-92 Muang Thai Life Assurance (MTL) 93-104 ➤ Other Information 105-114 ■Banking System and Regulations Update ■Government Policy ■Thai Economic Figures ■IR Contact Information and Disclaimer 115-123 124-141 142-162 163-164 บริการทุกระดับประทับใจ 3 4#3K KASIKORNTHAI Operating Environment: Economic Outlook for 2021 %YoY 5.0 0.0 -5.0 Key GDP Forecasts and Assumptions 2.4 -10.0 -6.1 2019 2020 2021 F* -0.5 2021 F 2021 F* % YoY (Previous) 2019 2020 Base Range Base Case Case GDP 2.4 -6.1 1.0 0.0-1.2 Private Consumption 4.5 -1.0 0.8 0.5-1.0 -0.5 -0.1 Government Consumption 1.4 0.8 3.0 2.5-3.5 2.5 Total Investment 2.2 -4.8 4.5 3.4-5.8 4.1 - Private investment 2.8 -8.4 3.5 2.5-5.0 3.0 - Public investment 0.2 5.7 8.5 7.2-9.5 7.5 Gov't Budget Deficit (% of GDP) -2.9 -5.1 -5.3 -5.0 to -5.4 -5.3 Exports (Customs Basis) -2.7 -6.0 11.5 8.5-12.5 12.4 Imports (Customs Basis) -4.7 -12.4 21.5 17.0-22.5 23.0 Current Account (USD bn) 38.2 16.5 -7.0 -8.3 to -3.7 -11.0 Headline Inflation 0.7 -0.9 1.2 0.8-1.5 1.2 Policy Interest Rate** 1.25 0.50 0.50 0.50 Key Points: ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK ■The Thai economy is likely to experience economic recession for two consecutive years ■Prolonged COVID-19 outbreak will have additional impact on the economy through domestic spending and tourism receipts ■Exports and government spending will be the key drivers for Thai economy this year ■Thai GDP may return to its pre-COVID-19 level in 2024 Risk Factors: ■COVID-19 outbreak, new COVID variants and domestic distribution of COVID-19 vaccines ■Thai Baht volatility Trade tensions and geopolitical risks ■Household and business balance sheet deterioration if outbreak lasts longer than expected ■Political instability Notes: MPC's policy rate is at 0.50% (as of August 4, 2021) ▲ represents a higher base case assumption, comparing with the previous forecast, Source: * KResearch (as of August 16, 2021 vs forecast on July 14, 2021) **KBank Capital Markets Research (as of January 19, 2021) represents a lower base case assumption, comparing with the previous forecast บริการทุกระดับประทับใจ K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Operating Environment: Economic Outlook for 2021 ■Global Economy ■Government Stimulus Plan ■Inflation ■Exports and Tourism ■Fed Policy Normalization ■Baht Outlook ■Global economy: The path of global economic recovery is now in peril after the highly infectious and more deadly Delta variant has been detected in many countries worldwide ■US: US economy is expected to rebound strongly, due to the rapid pace of vaccinations and fiscal stimulus programs. However, recovery will hinge on COVID-19 situation since US is currently reporting higher numbers of daily cases ■ Eurozone: Europe's economic recovery is expected to be strong this year. However, the spread of the Delta variant in the region remains a concern ■China: Chinese economy is expected to rebound strongly, as domestic and external demand is picking up. However, new COVID-19 outbreaks and floods may pose downside risks to the economy ASEAN economies: ASEAN economies will likely see uneven economic revival, due to containment of COVID-19, political factors, and economic structure in each country ■Government may roll out additional relief measures to support those who are affected by the lockdown measures ■Government investment projects may be delayed, due to potential shortage of capital goods amid disrupted global supply chain ■Inflation is expected to rise to 1.2% on the back of rising commodity prices amid supply chain disruption in the global and domestic markets ■Thai exports will rebound strongly, with faster-than-expected global economic recovery ■Tourist arrivals are expected to return less than expected due to prolonged COVID-19 outbreak and vaccination rates that may fall short of targets ■Fed would announce the QE tapering program later this year, and keep the Fed Funds rate of 0.00-0.25% in response to more persist inflation pressure and improving job market data ■Baht appreciated to around Bt32.6 per USD late August 2021 after a correction on short position on THB against USD, while the government eases COVID-19 restriction measures amid a slow down on new cases ■However, Baht would hit 32.75 per USD at the end of 2021 as Fed's tapering pressure, impact of COVID-19 to Thai economy and current account deficit Source: KResearch and KBank Capital Markets Research (as of August 18, 2021) Possible Impacts to Thai Economy ■Thai economy is still highly vulnerable to pandemic situation abroad and at home ■Due to increasing risks of the pandemic and slow vaccination progress in Thailand, the number of international tourist arrivals will be lower than expected ■ Supportive fiscal measures may help alleviate consumers' financial burden to some extent, but may not be able to offset the overall impact of COVID-19 on the economy ■Monetary policy is expected to remain accommodative to economic growth throughout 2021 ■Stronger than expected global economic recovery provides an upside to Thai exports ■BOT would maintain its policy rate at 0.50% in 2021 after maintaining a FIDF fee cut at 0.23% until the end of 2022 and pointing credit measures having more effective liquidity to effected groups ■A high fluctuation in USD/THB would make exporters and importers more difficulty for revenue management ■However, global trade remains support Thai exporters' revenue and investment บริการทุกระดับประทับใจ 5 6#4K KASIKORNTHAI Y2021 Financial Targets Consolidated ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK NIM 2020 Actual 1H21 Actual Y2021 Targets 3.27% 3.20% Note (Y2021) 1H21 NIM declined YoY, mainly due to lower yield on 3.1-3.3% loans from interest rate cut, deterioration of asset quality and loans in relief measures despite lower cost of funds. 4-6% Loan Growth 12.13% YTD 6.17% YTD 12.06% YoY Net Fee Income Growth* -10.17% 6.57% YoY Low single digit growth rate Cost to Income 45.19% 41.54% Ratio** Credit Cost per year (bps) 205 bps 168 bps NPL Ratio (Gross)*** 3.93% 3.95% ROE**** 7.10% 8.87% ROA 0.85% 1.03% Note: * Net Fee Income Mid-40s 1H21 YTD loans grew mainly from COVID-19 relief measures (mainly from SMEs), housing loans, corporate business, and retail lending using data analytics capability. 1H21 net fee income increased YoY mainly from fund management business and brokerage fee. 1H21 cost to income decreased YoY from an increase of net total income while expenses slightly increased; but cost to income will rise seasonally in 2H21. Focus on cost management and productivity improvement, with new investments for future growth. Credit Cost: Maintain conservative assumptions and Up to 160 bps prudent financial policy amid high uncertainties related to COVID-19. Relief measure help limit short-term impact on asset quality; while, asset quality is closely monitored and constantly reviewed. 4.0-4.5% N/A N/A Fees and Service Income - Fees and Service Expense; ** Cost to Income Ratio = Total Other Operating Expenses to Total Operating Income - net (Total Operating income less Underwriting Expenses); *** NPL Ratio (Gross) = NPL (gross) to total loans; NPL (gross) used in the calculation are loans to general customers and loans to financial institutions that are non-performing loans; total loans used in the calculation are loans to general customers and loans to financial institutions **** ROE = Net profit deducted Additional Tier 1 dividend after tax/Average total equity excluded Additional Tier 1 บริการทุกระดับประทับใจ 7 K KASIKORNTHAI KASIKORNBANK Vision, Purpose and Culture Vision Purpose Customer ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK BANK OF SUSTAINABILITY "KASIKORNBANK aims to be the most innovative, proactive, and customer centric financial institution, delivering world class financial services and sustainable value for all stakeholders by harmoniously combining technology and talent" To Empower Every Customer's Life and Business Total Solution Promise K-Culture Attentive & Inclusive Any Time & Any Where Trustworthy A PIONEER FOR THE BETTER, A STEP AHEAD FOREVER Customer at Heart | Agility | Collaboration | Innovativeness บริการทุกระดับประทับใจ 8#5K KASIKORNTHAI The K-Strategy ■ K-Strategy is reimagined to drive growth and empower customer Purpose Strong Brand ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK To Empower Every Customer's Life and Business STRONG TRUSTWORTHY BRAND Γ PAY: Growth Strategy Dominate Digital Payment Reimagine Commercial & Consumer Lending Key Capabilities 1. Ecosystem Partnership & Harmonized Channel 5. Data Analytics Democratize Investment & Insurance Strengthen Harmonized Sales and Service Experience Improve Value-Based Productivity 8 TRANSFORMATION JOURNEYS 2. Intelligent Lending 6. Cyber Security 3. Proactive Risk & Compliance Management 7. Performing Talent and Agile Organization บริการทุกระดับประทับใจ Penetrate Regional Market 4. Regional Payment & Settlement 8. Modern World Class Technology Capability 9 K KASIKORNTHAI Relief Measures to Lessen COVID-19 Impact ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Relief measures (the government, the BOT, and KBank) have been offered to help customers through the COVID-19 pandemic. Relief measures help limit short-term impact on asset quality; while, asset quality is closely monitored and constantly reviewed. Total Loans Bt2.3trn Loans Exited Relief Programs Bt516bn Total Loans Able to Pay Bt486bn or 94% Loans Bt2.4trn Exited Relief Programs Bt480bn or 20% 14% of or 23% Total Loans Days Past Due (> 30 days) Bt30bn or 6% Loans in Relief Programs Bt319bn or 14% Retail Bt89bn Corporate Bt94bn Able to Pay Bt287bn or 90% SME Bt136bn As of March 2021 Days Past Due (> 30 days) Bt32bn or 10% บริการทุกระดับประทับใจ Able to Pay Bt438bn or 91% Loans in Relief Programs Bt338bn or 14% 14% of Total Loans Retail Bt108bn Corporate Bt95bn SME Bt135bn As of June 2021 Days Past Due (> 30 days) Bt42bn or 9% Able to Pay Bt327bn or 97% Days Past Due (> 30 days) Bt11bn or 3% 10#6K KASIKORNTHAI Composition of Growth: Loans by Business ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Moderate loan growth momentum in line with full-year target Loan Portfolio Structure Loan Portfolio Bt bn Consolidated 2,400 2,245 2,383 Amount (Bt bn) Dec 20 Jun21 1H21 1H21 Y2021 Loan Growth Yield Range Loan Growth Target 2,000 1,803 1,914 2,002 36% 35% Corporate (%) (%) 1,600 35% 36% 34% ■ SME Corporate Loans 814 834 2.5% 2-4% 1,200 800 36% 35% 34% 33% 33% SME Loans 733 782 6.7% 5-7% 400 24% 25% 28% 28% 29% Retail Others Retail Loans 638 695 8.9% 5-7% 0 5% 4% 4% 3% 3% Other Loans Total Loans 60 2,245 72 19.6% 2,383 6.2% 4.6% (%) 1-3% 2-4% 11-13% 4-6% 2017 2018 2019 2020 1H21 Note: * From time to time, the Bank has adjusted loan definitions based on loan portfolio management; thus, the latest loan base is not comparable with previous reports. 1H21 Corporate Loans ■ Loan portfolio mainly grew from short-term lending from liquidity needs ▪ KBank provided relief measures to corporate customers in a timely SME Loans Retail Loans Loan Definition manner ■ Amid slow pace of global and local economy, the bank prudently supported customers' liquidity needs, where appropriate ■ Financial assistance measures meant to soften impact of the outbreak mainly support loan expansion in this quarter ■ Major loan contribution to Commerce Consumer and Construction industry ■ Retail loans grew mainly from home loans, expanding into high potential customers with product offerings matched to customers' needs ■ Offered "Smart PAY & Smart CASH via K PLUS" for credit card customers to better provide accessibility and convenience ■ Offered new feature, "Swipe, Press, Pay by Installments in one card," for Xpress Cash. Customer enables QR code, scans option for cardless cash withdrawal at K-ATMs nationwide, and completes money transfer free of charge 24/7 via KPLUS 2021 Outlook ■ Potential loan growth in some sectors to support business opportunities ■ KBank continuously provides assistance to corporate customers affected by COVID-19 pandemic ■ Domestic and global trade still uncertain; local government spending and public investment remain major drivers. Lending growing organically and prudently while still meeting customers' funding needs and aligning with government measures ■ Apply data analytics to enhance predictive model and credit process in order to lend intelligently with acceptable risk, via blended traditional and digital channels ■ Continuous growth supporting consumer market and local demand ■ Focus on lending thru data analytics and supporting financial solutions for all life stages via assisted and unassisted channels where most relevant to customers' lifestyles and needs ■ Maintain lead market position in key strength products ■ Focus on new potential target customers with acceptable risk; predictive monitoring and strict control on loan portfolio quality Corporate Loans: Loans of KBank and KBank's Subsidiaries in Corporate Segments (annual sales turnover > Bt400mn) SME Loans: Loans of KBank and KBank's Subsidiaries in SME Segments (annual sales turnover ≤ Bt400mn) Retail Loans: Loans of KBank and KBank's Subsidiaries in Retail Segments บริการทุกระดับประทับใจ Other Loans: Composed of loans through the insurance business (MTL), regional markets, and other loan types not directly attributable to the main business groups. Before Y2020, other loans were loans in Enterprise Risk Management Division (NPL + Performing Restructured Loans) were reclassified to their customer segments. K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Composition of Growth: Net Fees and Non-interest Income June 2021 (Consolidated) 25% 36% 30% 28% 23% 21% 22% 1H21 Total Operating Income - net Non-interest Income Ratio and Net Fee Income Ratio (Bt bn) (%) 160.49 154.89 200- 156.86 155.48 50 (+2%) (-1%) (+3%) (-3%) 1 40% 40 37% 150 36% 80.88 40% 37% 30% (+2% YOY) 30 25% 100 28% 20 50 60% 63% 64% 70% 72% 10 0 0 2017 2018 2019 2020 1H21 2017 Net Interest Income Non-interest Income 2018 Non-interest Income Ratio 2019 2020* ■Net Fee Income Ratio Net Fee Income GOGSPROCEDURE ■Fee and Service Income - net (Bt bn41.31 (+6%) 38.12 36.74 40 (-8%) Net Premium Earned - net (-4%) 33.00 (-10%) | ■Dividend Income 30 23.03 72% (4% YoY) Share of Profit from Investments on Equity Method 20 9% 6% 0.1% Gain on Investment 0.3% 0.1% 4% 15% 78% 10 6% 5% 13% 16% 14% 5% 18% -0.4% -0.3% 2017 2018 2019 2020* 113% -1% -2.5% 1H21 Gain on financial instrument measured at FVTPL (Gain on Trading and FX transactions-Old) 0 2017 2018 2019 2020* 1H21 Non-interest Income (Bt bn) 62.70 (-2%) 56.95 57.80 60 66% (-9%) (+2%) 3% 45.87 (-21%) 67% 64% 4% I Other Operating Income | 18.01 (+7% YoY) ■1H21 non-interest income accounted for 28% of total net operating income and net fee income accounted for 22%; non-interest income decreased 4% YoY, mainly from mark to market of financial assets according to market condition and decrease in net premium earned - net. ■Net fee income increased 7% YoY, mainly from fund management business and brokerage business; while fee from money transfer decreased Note: Non-interest Income Ratio = Non-interest Income/Total Operating Income - net -Net Fee Income Ratio = Net Fee Income / Total Operating Income - net - Net Premium Earned net = Net Premium Earned less Underwriting Expense * The Bank and its subsidiaries have adopted new accounting standards (TFRS 9: Financial Instruments) since January 1, 2020 onwards, some financial statements and financial ratios are not comparable with previous years' financial figures before Y2020, which were based on the prior accounting standards (non-TFRS9). บริการทุกระดับประทับใจ 11 12#7K KASIKORNTHAI Asset Quality and Expected credit loss (Provision) June 2021 (Consolidated) Expected credit loss (Provision) ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK During 1997 (Bt bn) Asian Crisis* 50.6 48 44.1 42 36 30 16.8 18 12 6 -2.3 0 Coverage Ratio | During 1997 Asian Crisis* (%) I 150 41.8 43.5 33.8 32.5 34.0 100 91.6 160.6 154.1 127.1 131.8 134.5141.4 148.6 149,2 !111.0 130.0 130.9 148.5 26.4 119.5 9.4 11.7 14.2 48.8 50 34.7 6.7 7.3 8.4 L 25.4 30.0 34.2 0.7! 0 1996 1997 1998 1999 2000 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020** 1H21 1996 1997 1998 1999 2000 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020** 1H21 Note: Provision referred to Impairment Loss on Loans and Debt Securities; from January 1, 2020 onwards based on TFRS9, provision refers to Expected Credit Loss During 1997 Asian Crisis* (%) 888 44532220 42.0 723 31.7 23.5 NPL was peak at 42.3% in 1Q99 287 15 15.9 10 44 5 5.1 NPL Ratio and Credit Cost Asset quality remains manageable; closely monitored and constantly reviewed. ■NPL ratio in 1H21 was at 3.95%, with coverage ratio of 154.1%. 1H21 credit cost was 168bps; while COVID-19 negatively affected asset quality, relief measures lessened impact in the short-term. (bps) 900 NPL ratio Credit Cost 700 500 239 204 168 175 174 205 168 300 102 3.76 14 85 96 66 64 66 3.76 2.45 2.16 2.11 2.24 2.70 3.32 3.30 3.34 3.65 3.93 3.95 100 -100 NPL Ratio by Business Corporate Business SME Business Retail Business*** 2016 2017 2018 2019 2020 1H21 <2% <2% <2% <2% <2% <2% -5% ~5% -5% -6% <7% <7% -4% -4% -4% -4% <5% <5% 1996 1997 1998 1999 2000 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020** 1H21 Notes: Data in 1996-1997 is KBank only ** The Bank and its subsidiaries have adopted new accounting standards (TFRS 9: Financial Instruments) since January 1, 2020 onwards, some financial statements and financial ratios are not comparable with previous years' financial figures before Y2020, which were based on the prior accounting standards (non-TFRS9). *** NPL ratio in retail business, excluding 180 dpd (days past due) of credit card and consumer loans for peer comparison K KASIKORNTHAI ROA and ROE June 2021 (Consolidated) บริการทุกระดับประทับใจ ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK ROA (%) 2.5 20 ROE*** (%) 22 24 2.0 16 1.5 1.20 1.27 1.20 0.85 1.03 12 10.24 10.61 9.90 8.87 1.0 7.10 8 0.5 4 0.0 0 2017 2018 2019 2020* 1H21 2017 2018 2019 2020* 1H21 ROA (%) ROE (%) 2017 2018 2019 2020 1H20 1H21 1Q21 2Q21 1.20 1.27 1.20 0.85 0.56 1.03 1.14 | 0.93 10.24 10.61 9.90 7.10 4.72 8.87 9.57 8.11 Note: * The Bank and its subsidiaries have adopted new accounting standards (TFRS 9: Financial Instruments) since January 1, 2020 onwards, some financial statements and financial ratios are not comparable with previous years' financial figures before Y2020, which were based on the prior accounting standards (non-TFRS9). The Bank restated the 1Q20 financial statements, due to reclassification of investment in trust fund to FVOCI. *** ROE = Net profit (attributable to equity holders of the Bank) deduct dividend from other equity instruments after income tax divided by average equity of equity excluded other equity instruments บริการทุกระดับประทับใจ 13 14#8K KASIKORNTHAI Net Interest Margin June 2021 (Consolidated) NIM (%) 8.00 ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Yield on Earnings Assets and Cost of Fund (%) 54 4 3.44 3.39 3.31 3.27 6.00 5.45 5.29 3.20 5.21 4.82 I 4.60 4.37 32- 4.27 4.19 3.83 Yield on Loans 4.00 3.62 Yield on Earnings Assets 1 2.00 1.22 1.19 1.23 0 0.78 0.59 Cost of Fund 2017 2018 2019 2020** 1H21 1.11 1.11 1.14 0.71 0.54 Cost of Deposits* 0.00 2017 2018 2019 2020* 1H21 ■NIM was 3.20% in 1H21, decreasing YoY, due to lower yield on loans from interest rate cut, deterioration of asset quality and loans in relief measures, despite of lower cost of funds. High portion of CASA (80%) also helped support low cost of fund. 2017 2018 2019 2020 1 H20 1H21 1Q21 2Q21 NIM (%) 3.44 3.39 3.31 3.27 3.34 3.20 3.16 3.22 Yield on Earnings Assets (%) 4.37 4.27 4.19 3.83 3.98 3.62 3.59 3.64 Yield on Loans (%) 5.45 5.29 5.21 4.82 5.11 4.60 4.56 4.67 Cost of Fund (%) 1.22 1.19 1.23 0.78 0.88 0.59 0.60 0.58 Cost of Deposits (%), incl DPA 1.11 1.11 1.14 0.71 0.80 0.54 0.55 0.54 Note: Cost of deposits including contributions to the Financial Institutions Development Fund (FIDF) and Deposit Protection Agency (DPA). * The FIDF fee is temporarily reduce from 0.46% to 0.23% for 2 years, according to the BOT announcement in the Royal Gazette, during January 2020 to December 2021. ** The Bank and its subsidiaries have adopted new accounting standards (TFRS 9: Financial Instruments) since January 1, 2020 onwards, some financial statements and financial ratios are not comparable with previous years' financial figures before Y2020, which were based on the prior accounting standards (non-TFRS9). บริการทุกระดับประทับใจ K KASIKORNTHAI Cost to Income Ratio June 2021 (Consolidated) Cost to Income Ratio ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Cost to Average Assets Ratio (%) (%) 50 42.31 43.96 45.32 45.19 41.54 6 40 4 2.31 2.26 2.26 30 2.01 1.78 20 10 0 T 2018 T 2019 2020* 1H21 2 0 2017 2018 2019 2020* 1H21 2017 1H21 cost to income ratio was 41.54%, decreased YoY from an increase of net total income while operating expenses slightly increased; but cost to income will rise seasonally in 2H21. Cost to Income Ratio (%) Cost to Average Assets Ratio (%) 2017 2018 2019 2020 1H20 42.31 43.96 45.32 2.31 2.26 2.26 45.19 2.01 42.00 1H21 41.54 1Q21 2Q21 41.30 41.78 1.93 | 1.78 I 1.78 I 1.78 Note: * The Bank and its subsidiaries have adopted new accounting standards (TFRS 9: Financial Instruments) since January 1, 2020 onwards, some financial statements and financial ratios are not comparable with previous years' financial figures before Y2020, which were based on the prior accounting standards (non-TFRS9). ** The Bank restated the 1Q20 financial statements, due to reclassification of investment in trust fund to FVOCI. บริการทุกระดับประทับใจ 15 16#9Note: K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Capital (Reported Number: Excluding Net Profit of Each Period) June 2021 (Consolidated) Bank only KASIKORNBANK FINANCIAL CONGLOMERATE* Basel III Basel III (%) 17.20 17.26 18.52 17.74 17.13 18.0 3.58 2.58 2.51 2.80 2.45 18.0 15.0 0.68 AT1 0.65 AT1 15.0 12.0 12.0 9.0 14.62 14.75 14.94 14.94 14.68 9.0 6.0 6.0 3.0 3.0 ooo ooo o (%) 19.62 17.96 2.30 18.32 18.80 18.19 2.42 3.43 2.67 2.33 0.65 AT1 0.61 AT1 15.66 15.90 16.19 16.13 15.86 0.0 0.0 2017 2018 2019 2020** 1H21 ■Tier1 ■Tier2 AT1 2017 2018 2019 ■Tier1 ■Tier2 2020** AT1 1H21 Capital adequacy remains sufficient to support business growth; maintained adequate Tier 1 ratio, as required under the Basel III and new requirements. Additional Tier 1 instrument issuance is intended to optimize and further strengthen capital base in long run. 2016 2017 2018 2019 2020 1H21 Bank only CAR (%), excluding net profit of each period Tier 1 (%), excluding net profit of each period KASIKORNBANK FINANCIAL CONGLOMERATE* CAR (%), excluding net profit of each period Tier 1 (%), excluding net profit of each period 18.17 17.20 17.26 18.52 17.74 17.13 14.27 14.62 14.75 14.94 14.94 14.68 18.84 15.16 17.96 15.66 18.32 15.90 19.62 16.19 18.80 16.13 18.19 15.86 * KASIKORNBANK FINANCIAL CONGLOMERATE means the company under the Notification of the Bank of Thailand re: Consolidated Supervision, consisted of KBank, K Companies and subsidiaries operating in supporting KBank, Phethai Asset Management Co., Ltd. and other subsidiaries within the permitted scope from the BOT's to be financial conglomerate. Under Bank of Thailand regulations, net profit in the first half of the year is to be counted as capital after approval by the Board of Directors as per the Bank's regulations. Net profit in the second half of the year is also counted as capital after approval of the General Meeting of Shareholders. However, whenever a net loss occurs, the capital must be immediately reduced accordingly. ** The Bank and its subsidiaries have adopted new accounting standards (TFRS 9: Financial Instruments) since January 1, 2020 onwards, some financial statements and financial ratios are not comparable with previous years' financial figures before Y2020, which were based on the prior accounting standards (non-TFRS9). K KASIKORNTHAI Dividend Dividend Per Share บริการทุกระดับประทับใจ ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Dividend Payout Ratio (Bt) 5.00 (%) 50 5.0 42.49 4.00 4.00 4.00 4.00 4.00 40 4.0 10 34.43* 3.50 31.88 32.14 32.80 3.00 27.00 27.83 29.40 30 22.32 26.96 3.0- 2.50 2.502.50 2.50 32.33 22.12 2.00 2.00 2.0 20 20 22.51 1.0 0.50 10 23.73 0.0 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 1H21 I Interim Dividend 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Dividend policy: both operating results and long-term returns to shareholders are taken into consideration in determining dividend payments, in order to ensure a sustainable and adequate capital level through the changing economic environment, the ongoing adoption of Basel III and new requirements. Dividend Per Share (Bt) Dividend Payout Ratio (%) 2007 2008 2.00 2.00 2.50 31.88 32.33 42.49 2009 2010 2011 2.50 32.14 2012 2013 2014 2015 2016 2017 2018 2019 2020 2.50 3.00 3.50 4.00 4.00 4.00 4.00 4.00 5.00 2.50 27.00 22.12 22.32 22.51 27.83 26.96 32.80 29.40 34.43 23.73 Note: * The Board of Directors' Meeting of KASIKORNBANK PCL. No. 1/2020, held on January 30, 2020 has approved the share repurchase project for financial management purposes with the number of shares to be repurchased not exceeding 23,932,601 shares or equal to the amount of not exceeding 1% of the total paid-up capital of the Bank and the maximum amount not exceeding Bt4,600mn. The share repurchase was conducted through the Stock Exchange of Thailand during February 14, 2020 to February 27, 2020. - In 2020, due to the high uncertainty in the near future, the BOT supported the preventive measures by allowing financial institutions to suspend payment of interim dividend from Y2020 operating performance and to pay dividends for Y2020 not exceeding Y2019 payout ratio and 50% of Y2020 net profit. - In 2021, as banks are strong with sufficient capital to withstand the impact of COVID-19 outbreak, the BOT allowed banks to pay 2021 interim dividends not exceeding Y2020 dividend payout ratio and 50% of 1H21 net profit. - Dividend payout will be calculated based on dividend divided by net profit attributable to shareholders net of dividend on other equity instrument including additional Tier 1 instrument. บริการทุกระดับประทับใจ 17 18#10K KASIKORNTHAI Summary ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK ■The K-Strategy: Customer Centricity remains our core philosophy with purpose to "Empower Every Customer's Life and Business" Balanced Growth: loans to grow carefully in line with economic conditions and loans relief measures; appropriate liquidity maintained; manageable asset quality supported by strong risk management capabilities; appropriate loan loss reserves; manageable cost to income ratio; appropriate ROE maintained ■ Adequate Capital: maintains adequate Tier 1 ratio, as required under Basel III amid COVID-19 especially after debt moratorium and remain sufficient for new requirements. Additional Tier 1 instrument issuance is intended to optimize and further strengthen capital base in long run ■Sustainable Development: conducts business with the principles of a Bank of Sustainability, and appropriate risk management and good corporate governance principles; striving to balance economic, social, and environmental dimensions to achieve goals and create sustainable long-term returns K KASIKORNTHAI บริการทุกระดับประทับใจ Appendix ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK 19 บริการทุกระดับประทับใจ 20 20#11K KASIKORNTHAI KBank: Strategy บริการทุกระดับประทับใจ ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK K KASIKORNTHAI Performance ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK ■Success is driven by continuous growth in number of customers and K PLUS users; highest Net Promoter Score among banks in Thailand Number of Customers* (mn) K+ K PLUS Users and Transactions** (mn) 14,516 21 21 15,000 8,477 9,133 10,000 6,960 10 5,188 3,052 14.4 12.1 13.4 5,000 1,646 10.0 15.7 7:3 4:6 0 0 2016 2017 2018 2019 2020 1H20 1H21 Total Users Number of Transactions (RHS) 255 17.7 20 18.3 (+3.4%) 16.0 16.5 15.0 13.9 15 10 5 2505 15 2016 2017 2018 2019 2020 1Q21 * Customers in Retail Business account for 93%, SME Business 7%, and Corporate Business less than 1% of customer portfolio ** Active users defined as minimum of 1 Login per month; 75% active users as of 1H21 Net Promoter Score (NPS)*** (#1 among Banks in Thailand) 40 35 35 30 30 25 2019 2020 *** NPS Study 2020 surveyed by The Nielsen Company during August to September 2020, measuring the willingness of customers to recommend a company's products or services to others บริการทุกระดับประทับใจ 22 22#12K KASIKORNTHAI The K-Strategy ■ K-Strategy is reimagined to drive growth and empower customer Purpose Strong Brand ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK To Empower Every Customer's Life and Business STRONG TRUSTWORTHY BRAND Γ PAY: Growth Strategy Dominate Digital Payment Reimagine Commercial & Consumer Lending Key Capabilities 1. Ecosystem Partnership & Harmonized Channel 5. Data Analytics Democratize Investment & Insurance Strengthen Harmonized Sales and Service Experience Improve Value-Based Productivity 8 TRANSFORMATION JOURNEYS 2. Intelligent Lending 6. Cyber Security 3. Proactive Risk & Compliance Management 7. Performing Talent and Agile Organization บริการทุกระดับประทับใจ Penetrate Regional Market 4. Regional Payment & Settlement 8. Modern World Class Technology Capability 223 K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK Growth Strategy: Strengthen Leadership Position PAY Dominate Digital Payment K PLUS as Open Banking Platform: Gain online payment share via K PLUS open-platform and ecosystem partnership collaboration Omni-Channel Merchant Platform: Accept all sources of funds and support Online to Offline (020) experience; providing smart information and Customer Relationship Management (CRM) Regional Payment and Settlement: Facilitate payment and settlement to provide regional business connectivity Reimagine Commercial & Consumer Lending ■ Penetrating Consumer Credit: Add secured loan for self-employed and expand into unsecured loans SME Business Recovery: Use data to improve customer survival rate Leveraging Corporate Relationship: Service large corporates & monetize relationship through shared platforms with capital markets fee bundling Democratize Investment & Insurance Master Relationship Manager (RM) x Completed Offering: Penetrate wealth-potential customers via Master RM by completed offerings and better experience Digital & New Investment Platform: Provide personal-based advice to offer products thru Open Architecture platform Competitive Product Offerings: Improve return to customers by better sourcing and optimized risk; develop products for small customers บริการทุกระดับประทับใจ 224 24#13K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Penetrate Regional Market: Asset-Light Regional Expansion into AEC+3 ■ Growth in regional markets: strategically focusing on AEC+3 markets, KBank pursues an integrated regional operating model: physical footprint, digital platform, and regional partnerships Note: South Korea China Lao PDR. Myanmar Japan Cambodia Vietnam Indonesia - Two subsidiary banks: KASIKORNTHAI BANK (Lao PDR) with two branches in Ponesinuan and Lane Xang, KASIKORNBANK (CHINA) with three branches in Shenzhen, Chengdu, Shanghai and one sub-branch in Long Gang - Three international branches: Cayman Islands, Hong Kong, and Phnom Penh Seven representative offices: Beijing, Kunming, Tokyo, Yangon, Ho Chi Minh, Hanoi, and Jakarta - One strategic partner: Maspion Bank in Indonesia - Global partners with 82 banks in 17 countries: 50 Japanese partner banks; 10 Chinese partner banks; 1 Hong Kong bank; 3 Korean partner banks; 13 ASEAN partner banks (in Vietnam, Indonesia, Lao PDR, Cambodia, Philippines, Brunei, Malaysia, Singapore and Myanmar); 4 European regional banks (in Germany, Italy and Russia) and 1 Indian Bank Physical Footprint Lao PDR. Cambodia Myanmar Vietnam Indonesia Digital Platform Japan China X-Border Multi-Currency Settlement X-Border THB Direct Settlement X-Border Retail Payment Partnership AEC CB HAMK MetinBank Beha C A bank BCA BANK MASPION Hana Bank + HACHUN BARK AYA Bank 靜岡銀行 CHUGOKU BANK KRZ BANK Maybank He 百十四街 ...and others บริการทุกระดับประทับใจ 25 K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Penetrate Regional Market: KBank's Regional Digital Expansion via 3 Strategic Plays ■To achieve rapid regional digital expansion in AEC+3, KBank will use 3 strategic plays, each supporting the others, to build growth momentum and accelerate customer base development & financial return Strategic Plays 2021 Strategic Actions DIGITAL LENDING & BANKING-AS-A-SERVICE End-to-end online high-yield credit capabilities with expansion to lending platform (BaaS: Bank as a Service) Disruptive Play Origination Monitoring CREDIT TECH Underwriting Credit Scoring Loan Booking Guarantee Collection Operation KBank & FI Partners Pilot digital lending with local partners Mass Acquisition Play MASS ACQUISITION WITH TRANSACTIONAL BANKING Customer acquisition through local platforms with engagement via transactional banking Business EDC & PGW Ecosystem Partners Retail K+ ATM / Agent Build 4 transactional banking channels with low-risk, stage-gate execution K-Cyber Banking AGGRESSIVE CORPORATE LENDING Aggressive lending by capturing four main customer groups Aggressive Play Customer Group Locally Listed Companies Local Large Corporates TDI AEC+3 Grow corporate lending portfolio aggressively with competitive pricing Note: TDI = Thai Direct Investment; EDC Electronic Data Capture; PGW = Payment Gateway บริการทุกระดับประทับใจ 26 26#14K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Strengthen Harmonized Sales and Service Experience Reshape channel mix and sales model according to evolving customer behavior, to deliver better experience and productivity Optimize physical channel 2 network by maintaining coverage, resizing, and remodeling Banking Agent K PLUS as OPEN 1 PAYMENT PLATFORM K+ and Authenticator (K-ID) Branch Harmonized LINE Channel Strengthen ATM/CDM K-Cyber K-Corporate Connect digital marketing, develop digital/hybrid onboarding 4 KCC complements digital channels by providing Website Contact Center RM/PS TSA/DSA troubleshooting and educational digital service 3 Enhance sales model to deliver total solution with best customer fit Note: KCC = K-Contact Center; RM = Relationship Manager; PS = Product Specialist, TSA = Tele Sale Agent, DSA = Direct Sale Agent บริการทุกระดับประทับใจ 27 27 ☐ K KASIKORNTHAI Improve Value-Based Productivity ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Dynamic and flexible resource allocation aligned with strategic direction and support to new businesses, e.g. digital payment, credit reimagining, investment and insurance democratization, and regional market penetration ■ Spending effectiveness aligned with business priorities and desired value of product proposition ■ Productivity improvement focused on Integrated End-to-End Customer Journey and Organization-wide Support Excellence using lean management toward data driven in the areas of: Seamless customer service experience and sales productivity enhancement ▪Optimize branch & ATM network ■Enhance digital on-boarding ▪Drive customer migration to chat bot and self- service options on K PLUS ▪Increase sales productivity using data analytics Human resources optimization ▪Focus on lean organization with organizational design, workforce management through staff redeploying, upskilling, and reskilling ■Create organizational infrastructure to drive agile working environment and workplace redesigned IT modernization and procurement effectiveness ■Improve asset utilization; optimize maintenance service /license costs and contract negotiations ▪Design IT architecture and infrastructure together with adopting modernized technology for cost optimization Operational process improvement ▪Enhance cash handling optimization and centralization model ■Streamline and digitize back-office processes ▪Strengthen E2E credit and non-credit risk product processes ▪ Enhance data analytics tools for risk and compliance monitoring บริการทุกระดับประทับใจ 28 28#15k KASIKORNTHAI New Capabilities to Enable K-Strategy ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK 8 Transformation Journeys are new capabilities to help "Empower Every Customer's Life and Business" To Empower Every Customer's Life and Business 1 Ecosystem Partnership & Harmonized Channel Orchestrating an ecosystems with partners and providing excellent experiences throughout the customer journey Regional Payment & Settlement Building and connecting cross- border payment capability 7 8 2 Intelligent Lending Leveraging customer data to offer personalized lending experience and achieve fair risk adjusted return Purposeful & Practical Leadership Data Analytics 5 Expanding data analytics capability to enhance business opportunity and operational efficiency 3 Proactive Risk & Compliance Management Proactively identifying potential risk and establishing loss prevention and detection Cyber Security 6 ■ Enhancing comprehensive cyber security Performing Talent and Agile Organization Modern World Class Technology Capability บริการทุกระดับประทับใจ K KASIKORNTHAI Ecosystem Partnership & Harmonized Channel " - ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Orchestrating an ecosystem with partners and providing excellence throughout the customer journey Developing presence where customers are with an excellent customer experience Partnership SME Corporate Customers Q. eWallet and Payment Grob ptt f YOUTRIP LINEMAN Wong rabbit LINE Ray 支 支付宝 ALIPAY Joint Venture for Co-Lending through LINE Platform LINE E-Commerce & Lifestyle Platform/Co-Lending through Partners' Platform Laz Retail Shopee DCENTRAL COTH Dolfin Thel WeCha University and Hospital Chula Investment Platform LU ® Venture Capital* eventpop конктроин OOKBER Grab N Jitta aspire WORKMATE NIUM HORGANCE digio Hobowalth FoodStory CARRO Sendo favstaye 29 29 Note: Beacon Venture Capital, a wholly-owned venture capital fund of KBank, invests in companies and startups, via: - * Direct investment: a total fund size of USD135mn to invest in early to growth-stage technology startups covering not only FinTech but also consumer internet and enterprise technology, aiming to leverage new technology from startups to support KBank's businesses Indirect investment: investments through VC Funds to enable KBank to leapfrog into the world arena and stay abreast of innovative technologies and business models in other regions, e.g. partnered as an LP with VC funds managed by Integra Partners (known as Dymon Asia Capital), Vertex Ventures, Nyca, Jerusalem Venture Partners and China Renaissance บริการทุกระดับประทับใจ 30#16K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Harmonized Channels: Domestic Channels and No. of Transactions Branch E-Machine (ATM/CDM**) (-3) (-30*) I (-176) (+19*) 1,026 958 886 860 857 830 11,891 11,985 10,973 10,981 10,805 11,000 2017 2018 2019 2020 1H21 2021T 2017 2018 2019 2020 1H21 2021T ** Cash Deposit Machine Mobile Banking Users (mn) Number of Transactions*** (+1.3) (+3.1*) K+ 1.2bn 11% 8% 1.5bn 2.0bn 2.7bn 3.8bn 2.4bn 5% 4% 2% 1% Branch 20% 28% 15% E-Machine 37% 48% 59% 17.5 14.4 15.7 12.1 10.0 7.3 58% 68% 78% 84% Mobile Banking 44% 30% 2016 2017 2018 2019 2020 1H21 2017 2018 2019 2020 1H21 2021T * Compared to Y2020 K KASIKORNTHAI Domestic Channels New KBank Branch (Hybrid Branch) KBank *** Transaction includes only cash deposit, cash withdrawal, payment and transfer บริการทุกระดับประทับใจ Community Branch (K Park) ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK THE WISDOM Lounge This new branch design focuses on increasing the flexibility and efficiency of the branch banking services. The service area and all furniture are specially designed to assist branch staff to smoothly facilitate customer's adoption of self-service machines and digital channels (K PLUS). The height of the modular counter can be adjusted to accommodate various flow-in throughout the day. E-Machine The community bank where local people able to spend their life comfortably all day! Focusing on the outskirts of the city is response to the expansion of more villages and schools. K Park provides financial zones for transactions and co-working spaces with the Kids Zone and parcel service from KBank partner in the same place. An exclusive center providing a full range of services and facilities to High Net Worth Individuals and Affluent segments. M ATM ATM- ฝาก น Apart from being an ordinary cash-focused servicing machine, we enhance our self-service machine to be an authentication touch point for all digital onboarding such as e-Savings and e- Wallet account opening. The e-machines will provide massive additional convenience apart from normal branch coverage. KBank KBank Service ฝาก-ถอน-จ่ายบิล. SERVICE ยืนยันตัวตน เคแบงก์เชอร์วิส ใกล้ที่ไหน ไปที่นั่น KBank Service - Banking Agents are business partners with extensive network coverage, appointed by the Bank to provide specific banking services to customers such as accepting cash deposits into KBank accounts, cash withdrawals, bill payments, and identity verification when opening electronic bank accounts for retail customers. บริการทุกระดับประทับใจ อยู่น Is Tou ชาน o Digital Banking K เป็นรายแนเชอรีน Digital Banking includes: ⚫K PLUS K PLUS SME K PLUS SHOP K-Cyber Service K-Corporate Connect K-Payment Gateway K-PowerP@y (mPOS) ⚫ LINE BK ⚫ MAKE ⚫ Khunthong. สายเชีย ⚫ LINE KBank LIVE 32 32 31#17K KASIKORNTHAI Intelligent Lending ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Continuously support our customers with better serve end-to-end journey; these includes: ■ Enhance ability to leverage overall data foundation, develop insight-driven methods in defining customer qualification criteria and credit scoring to promptly offer personalized lending experience where needs; while the bank still balance acceptable risk and fair return. ■ Proactive implement customer-centric collection strategy with appropriate approach and portfolio quality improvement End to End Credit Journey Target Port Lead Generation Reach ABA Marketing & Offering Credit Assessment Monitoring & Collection Expected Outcome Wider Customer Reach Higher Conversion Optimized Risk Return Faster Time to Market บริการทุกระดับประทับใจ 33 K KASIKORNTHAI Proactive Risk & Compliance Management Value Enabler Partner with business and provide effective integrated risk solutions Key Capabilities ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK • Predictive and integrated customer segment-based credit analytics Data-led asset quality management to provide persona-based relief packages/collection treatment to Covid-19 affected customers Intelligent fraud management in all key business processes Effective risk management execution for business partners and 3rd parties ☐ ☐ Credit risk analytics & integrated credit portfolio planning & monitoring Enhanced fraud analytics & incident management Value Protector Strengthen & secure our business to be resilient and sustainable • Prudent risk-based provision and capital management Early error detection through effective quality assurance and fraud management Effective and proactive compliance management Customer data governance ■ Customer data protection Organization-wide prudent risk culture • and management Agile way of working and delivering integrated risk solutions Continuity & Resilient Operation under COVID-19 บริการทุกระดับประทับใจ 34#18K KASIKORNTHAI Regional Payment & Settlement ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Facilitate payments and settlements to provide regional business connectivity and opportunities for lending KBank Become Main Facilitator Bank Become AEC's Settlement Bank ◉ "Exploring" Flow of Data ERP Solution Shipping & CERP Inventory Mgmt ■ Execute money transfer transactions Support multiple settlement currencies ■ Ensure funds availability and a smooth experience Advance Flow of Goods Engage customers with Total ERP solution ■ Enhance facilitating business with ERP solution ■ Provide transactional lending with value added service ☐ Facilitate payment transactions B Support multiple sources of funds Ensure seamless experience throughout journey Transactional Lending Flow of Money Note: ERP = Enterprise Resource Planning บริการทุกระดับประทับใจ K KASIKORNTHAI Data Analytics ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Enhancing data analytics capability to enhance business opportunities and operational efficiency To Empower Every Customer's Life and Business Organization Structure Process & Infrastructure Culture Data Incident Management A B Business Understanding Data Understanding D Data Preparation Modeling / MIS /Dashboard Evaluation G Deployment Maintenance & Feedback loop Demand & Supply Management, Role and Responsibility (R&R) and People Capability Data Management & Tools Model / Management Information System (MIS) Development, Evaluation & Deployment Communication & Adoption Data Incident Management บริการทุกระดับประทับใจ 36 55 35#19K KASIKORNTHAI Cyber Security ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Enhancing comprehensive cyber security and IT capabilities; addressing and aligning critical capabilities to fortify cyber security Protect KBank's Cyber Assets & Reputation and Deliver Security, Resilience, & Trustworthiness Vision Statement Customer Promise Protect Customer Assets with KBank Strategy Strategic Capabilities Advance Prevention Strengthen processes & technology controls to address advanced threats and new technology adoption Provide secured services Expand Value Chain Prevention Expand prevention assurance program to K Group and third party engagements Cyber Hygiene Culture Ensure care & timely response for any cyber incidents Expand Detection & Response Expand cyber threat detection capability throughout the value chain, and strengthen response capabilities Cyber Hygiene Behaviors in Customer & Employee Work & Life 1 Effective Risk Identification 2 Advanced Threat Prevention 3 Situation Awareness & Threat Detection 4 Effective Incident Response & Recovery 5 Cyber Hygiene Culture บริการทุกระดับประทับใจ K KASIKORNTHAI Performing Talent and Agile Organization People Strategy: #UnlockPeoplePotential Aspiration To build an organization filled with positive energy and capable people who are committed to drive for mutual goals in order to ceaselessly deliver the best & timely solutions to customers Uplift People & Talent ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK #UnlockPeoplePotential Uplift employees' profiles & skill mobilizing capabilities to have the "right" number of "right" skill people & "right" leaders at the "right" time to fit with business needs Upgrade to HR4.0 Untangle Organization Establish ambidextrous organization; build effective coexistence and seamless collaboration for faster decision-making and execution Unify Culture Embed K-Culture DNA into KBank's way of work to ensure cross-functional alignment and achieve mutual goals of the bank Elevate HR's role beyond supporting execution to become a thought partner and solution enabler Deliver Employee Value Proposition Winning Team: Self Learning & Growth: Meaningful contribution to community บริการทุกระดับประทับใจ 38 34 37#20K ธนาคารกสิกรไทย KASIKORNTHAI 开泰银行 KASIKORNBANK KASIKORN BUSINESS - TECHNOLOGY GROUP (KBTG) Aiming to build modern world-class technology, allowing KBank to be the Top Regional Financial Provider IT Project Delivery Excellence ■ Drive strategic-focused projects and manage overall project portfolio for on-time, on-budget delivery ■ Best Employer of Choice in Southeast Asia Acquire, motivate, retain employees People Capability ■ Enhance employee capability Breakthrough Innovation KBTG KASIKORN BUSINESS-TECHNOLOGY GROUP A E2E Software Delivery Transformation Agile Global Delivery Practice E2E Automation (e.g. DevSecOps, Test Automation, Infra as Code) E2E Process Improvement BEST TECH ORGANIZATION in Southeast Asia BY 2022 Scale up existing products Continue to explore (Innovation Runway / Idea Portal, Partnership) ■ Build new capabilities (Al Factory, NLP for cost saving) บริการทุกระดับประทับใจ Operational Excellence Brilliant Basics (e.g. incident, service availability, capacity) Uncompromised Security Level IT Cost Reduction Note: DevSecOps = Development, Security, and Operation; CICD NLP E2E Continuous Integration and Continuous Delivery Natural Language Programming End-to-End 39 39 K KASIKORNTHAI KBTG Technology Towards a Sustainable Society: Paperless, Cashless and Contactless Use decentralized technology to digitize contracts and assets for more inclusive and efficient financial services KPOS: launch generic POS platform to maximize flexibility for DECENTRALIZED FINANCE SMEs, small businesses, and their customers in the 4.0 era PLATFORM BUSINESS MOBILE PLATFORM ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK K PLUS Mobile Banking: grow #1 Thai mobile banking platform for easy financial transactions, mobile payments, and lifestyle banking MAKE by KBank: launch and iterate a new mobile banking application based on Flutter technology for new-gen customers Employ data analytics and machine learning to improve credit process, personalization, and product recommendations by more than 200% Launch Al-based contactless face recognition technology service for payment applications MACHINE LEARNING Enable computer understanding in Thai language (e.g. chatbot, social listening), which can reduce human operator workload by 65% Note: DevSecOps = Development, Security, and Operation; NLP Natural Language Programming; POS = Point of Sale KBTG KASIKORN BUSINESS-TECHNOLOGY GROUP DEVSECOPS Create a faster, more secure, automated IT process that integrates software development, code security scan, and deployment into a single automated workflow HYBRID CLOUD Set up regional-scale infrastructure to support IT services that can run anywhere on premises and on cloud and can expand exponentially THAI NLP TEST AUTOMATION บริการทุกระดับประทับใจ Establish software testing process using automation technology to reduce manual testing effort as well as increase scale, quality, and agility BIOMETRICS 40 40#21K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KBTG Technology - Examples of Notable Innovations in 1H21 Towards a Sustainable Society: Paperless, Cashless, and Contactless MAKE by KBank A mobile banking application designed specifically for a new generation increasingly reliant on mobile banking for the freedom it gives to personalize financial management. LINE BK Customers can open an account, make funds transfers, and receive real-time notifications on transactions; includes integration of risk- assessment for instant loan service approval via LINE application. KUBIX Kubix Digital Asset Company Limited was established to operate as an Initial Coin Offering (ICO) portal for offering digital tokens in the primary market, aiming to develop investment markets via blockchain, while helping to promote technological literacy among investors, especially in digital token investment. MAKE by KBank LINE BK kubiz Digital Token for Everyone KhunThong Social chatbot helping friends settle expenses within a chat for a seamless payment experience. פלוויק Vikstyryn WUSTHU SURD! KhunThong Alternative Vaccine Registration Jointly developed with Thonburi Healthcare Group to serve as a channel to register for appointments and make advance payment for the Moderna vaccination via LINE application. THE X KBTG เปิดตัวแพลตฟอร์มด ทัล รองรับการลงทะเบียนสําหรับผู้สนใจ วัดบทางเลือก "Moderna" COVID-19 Hospitel Management Solution Worked with Praram 9 Hospital in creating a registration system for asymptomatic COVID-19 patients and those with minor symptoms. KBTG X PARENT'S COVID-19 Hospitel Management Solution ระบบบริหารจัดการ หอพัก ป่วยเอพาะกิจ COVID-19 บริการทุกระดับประทับใจ K KASIKORNTHAI KBTG Regional Digital Expansion Financial and Non-Financial Services Expansion in AEC+3 People's Republic of China Loans and supply chain products have been developed with more than 1 million customers on the Mainland Lao People's Democratic Republic 30 ATMs were installed in Vientiane to accommodate the use of e-Wallet and mobile banking applications Others Worked with the Department of Consular Affairs, Ministry of Foreign Affairs, in developing an e-Visa system to be applied to visa holders from the People's Republic of China, South Korea, the United States of America, Canada, Norway, Sweden, and Denmark ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KASIKORN VISION Information Technology Co.,Ltd (KTECH) ■ A fintech company wholly owned by KASIKORN VISION Co., Ltd. (KVision) registered in Shenzhen, People's Republic of China, with registered capital of Bt1,300mn " Primarily involved in the design and creation of IT systems, research of new technologies, and search for new business models conducive to digital banking and economic systems • Promoting the expansion of financial science and technology to ASEAN countries and making Shenzhen an important node in the Belt and Road Initiative Tourists บริการทุกระดับประทับใจ KTECH KTECH Office in Shenzhen, China 41 42#22K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KBTG: K-Stadium, Innovation Center and K+ Building KBTG BELL 05 04 ADAS RONG K K+ K-Stadium at KBTG Main Building K+ Building: City-based KBTG office with co-working spaces BOX IK PLUS Innovation Center at KBTG Main Building Creative Box for small meeting at KBTG Main Building K+ Building: City-based KBTG office with co-working spaces k KASIKORNTHAI KBTG Structure Note: บริการทุกระดับประทับใจ ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK กสิกรเทคโนโลยีกรุ๊ปเซเครเทเรียต ***KASIKORN TECHNOLOGY GROUP SECRETARIAT กสิกร แล็บส์ 开泰研发 KASIKORN LABS ■ Technology Research and Innovation Labs Pioneer new possibilities กสิกร ซอฟต์ 开票软件 KASIKORN SOFT ■ Software Development to Support Innovation and Business Requirements Generate Business Value " A Bridge between KBank and KASIKORN BUSINESS - TECHNOLOGY GROUP ■ Group's Control Structure Enable Seamless Integration กสิกร อินฟรา # KASKORN INFRA ■ Control Infrastructure Resources for the Change, the Run, and the Gone Ensure Service Continuity กสิกร เซิร์ฟ 开吞服务 KASIKORN SERVE ■ Center of Excellence for Technical Resource Pool and Service* Deliver Service Excellence กสิกร เอก 开基爱码艺有限公司 KASICORN X ■ Venture Builder New S-Curve Factory 43 KASIKORN BUSINESS - TECHNOLOGY GROUP established with 5 companies, as a wholly-owned subsidiary of KASIKORNBANK; included in the KASIKORNBANK FINANICIAL CONGLOMERATE, as approved by the BOT in October 2015 Registered capital in each company at Bt5mn, except for KASIKORN SERVE at Bt10mn KASIKORN SERVE changed names from PROGRESS SOFTWARE COMPANY LIMITED; established in March 1993 KASIKORN INFRA changed names from KASIKORN PRO COMPANY LIMITED; established in October 2015 KUBIX is a KX's subsidiary; established in March 2021 บริการทุกระดับประทับใจ 44#23K KASIKORNTHAI KBank: Business Highlights บริการทุกระดับประทับใจ ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK K KASIKORNTHAI Customer Segments Corporate Business Multi-Corporate Business Large Corporate Business Company with annual sales >Bt5,000mn ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK Company with annual sales >Bt400mn to Bt5,000mn 45 SME Business Retail Business Medium Business Small & Micro Business High Net Worth Individual Affluent Individual or company with annual sales >Bt50mn to Bt400mn Individual or company with annual sales ≤ Bt50mn, and with commercial credit limit Bt15mn Middle Income Mass Individual wealth with KBank and its wholly-owned subsidiaries* > Bt50mn Individual wealth with KBank and its wholly-owned subsidiaries* ≥ Bt10mn to < Bt50mn Individual wealth with KBank and its wholly-owned subsidiaries* ≥ Bt15,000 to < Bt10mn Individual wealth with KBank and its wholly-owned subsidiaries* < Bt15,000 Customer-centric strategy: offering a full array of financial solutions and a satisfying experience to our customers ➤ Synergistic portfolio management by monitoring eight customer segments ➤ Offer financial solutions from among KBank, its wholly-owned subsidiaries, and the insurance company Make significant progress towards long-term aspirations; performance on track Note: *Wealth with KBank and its wholly-owned subsidiaries is defined as savings and investments, such as deposit products with KBank, mutual funds with KAsset; or the monthly income of an individual customer บริการทุกระดับประทับใจ 46#24K KASIKORNTHAI Revenue by Business June 2021 (Consolidated) ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Loans Portfolio structure Non-interest Income * Retail Business Corporate Business (30.1%) (36.1%) Average Yield: 5-7% Average Yield: 2-4% Retail Business (51.3%) SME Business (33.8%) Average Yield: 5-7% Corporate Business (30.2%) SME Business (18.6%) * Non-interest income excludes capital market business, treasury business and others Note: Loan portion and loan yield of each customer segment includes loans from the Enterprise Risk Management Division (NPL + Performing Restructured Loans); figures are not comparable with loan data in other pages * The Bank and its subsidiaries have adopted new accounting standards (TFRS 9: Financial Instruments) since January 1, 2020 onwards, some financial statements and financial ratios are not comparable with previous years' financial figures before Y2020, which were based on the prior accounting standards (non-TFRS9). บริการทุกระดับประทับใจ K KASIKORNTHAI Business Direction Growth Strategy Dominate Digital Payments Reimagine Commercial & Consumer Lending Democratize Investment & Insurance Corporate Business Trusted partner to enrich customer's businesses with best in class financial services and solutions ■ Best funding solutions Penetrate Regional Markets ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Strengthen Harmonized Sales and Service Experience Improve Value-Based Productivity SME Business Bank for SME Customers Integrated business solutions, both financial and non-financial Digital banking for SME ■ Best transaction banking and ■ Data Analytic Lending breakthrough initiator World Business Regional digital expansion through 3 strategic plays Aggressive Play: Grow corporate lending portfolio aggressively with competitive pricing ■ Mass Acquisition Play: Build 4 transactional banking channels to acquire customers through local platforms with low-risk and stage-gate execution Disruptive Play: Pilot digital lending with local partners and build end-to-end online high-yield credit capabilities with expansion to lending platforms (BaaS: Bank as a Service) Retail Business Best Customer-Centric Bank " Ecosystem orchestrator and harmonized channel to deliver anytime, anywhere experience Data-driven offerings, especially consumer finance Private Banking Group International Comprehensive Wealth Management Services Cooperate with Lombard Odier to raise service and product standards to international levels ■ Provide integrated wealth planning services, advising families on wealth management, continuity, and growth ■ Enhance use of technology to improve client experience ■ Build comprehensive client insights from data-mining บริการทุกระดับประทับใจ 47 48#25K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Corporate Business: Performance and Market Position Multi-Corporate Large Corporate Business Business Medium Business Small and Micro Business High Net Worth Individual Affluent Middle Income Mass Main Bank Status* Corporate Bond Underwriting 22% 20% 19% 20% 16% 17% 17% 14% 11% 10% (#2) (#2) (#4) (#2) (#2) (#3) (#1) (#1) (#1) 30% 34% 35% 27% 30% 25% 26% 26% 26% 20% 20% (#1) (#1) (#1) (#1) (#1) (#1) 10% 90 0% 2011 2012 2013 2014 2016 2018 1H21 2013 2014 2015 2016 2017 2018 2019 2020 1H21 Source: The Thai Bond Market Association (ThaiBMA) Performance and Market Position ■Main Bank Status: 35% in 1H21 ■ Corporate Bond Underwriting: ranked #1 with 20% market share in 1H21 ■Transaction Services: top player in transactional banking services Cash Management Services: MB** 24% market share in 2018 (#1)/ CB** 24% market share in 2018 (#2) Trade Finance: MB** 27% market share in 2018 (#1) / CB** 32% market share in 2018 (#1) Mutual Fund Supervisor: ranked #1 with 37% market share in 1H21 Note: Main Bank Status = % of customers in the market who use KBank and its wholly-owned subsidiaries as their main operating bank and/or main savings and investment bank and/or main borrowing bank ** MB = Multi-Corporate Business, CB = Large Corporate Business K บริการทุกระดับประทับใจ ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KASIKORNTHAI SME Business: Performance and Market Position Multi-Corporate Large Corporate Business Medium Business Small and Micro Business High Net Worth Individual Affluent Middle Income Mass Business #1 in Market Share by Value* 30% 30% 30% 30% #1 in Main Bank Status* 31% 30% 28% 40% 35% 28% 29% 30% 29% 31% 30% 20% (#1) (#1) (#1) (#1) (#1) (#1) (#1) (#1) (#1) 20% (#1) (#1) (#1) 10% 10% 0% 2011 2012 2013 2014 2016 2018 Source: KBank Customer Survey 0% 2011 2012 2013 2014 2016 2018 Source: KBank Customer Survey 49 Performance and Market Position ■Main Bank Status: improved main bank status and strengthened #1 position ■Market Share: 31% market share; maintained #1 position ■ Market Position: strengthened #1 position in SME market - "Bank for SMEs"; targeted to be SME market leader in all areas KBank offered comprehensive solutions to SMEs through K SME CARE program launched in 2006, with a total of 25 classes and about 14,509 participants so far. In 2020, during the COVID-19 pandemic, KBank introduced How2Think - an online seminar with 24 topics Live on the "K SME" Facebook Page with over 300,000 views. Note: SME Business in Thailand accounts for 43.0% of Thailand's GDP, or Bt7.01trn (as of December 2018); supported by the government to become a key factor in economic and social growth (Source: The Office of Small and Medium Enterprises Promotion or OSMEP) - Market Share by Value = share of revenue (derived from both credit and non-credit products) that each bank gains from the market Main Bank Status = % of customers in the market who use KBank and its wholly-owned subsidiaries as their main operating bank and/or main savings and investment bank and/or main borrowing bank * Since 2014, corporate and SME business main bank status and market share are reported every two years ** Market share by value and main bank status in 2018 may not be comparable with those in previous years due to a new SME population base covering more SMEs with better data availability บริการทุกระดับประทับใจ 50#26K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Private Banking Group: Performance and Market Position Multi-Corporate Business Large Corporate Business Medium Business Small and Micro Business High Net Worth Individual* Affluent Market Share (Market Penetration) Middle Income Assets Under Management (AUM) 37% (Bt bn) 36% 850 36% 798 35% 800 775 35% 750 34% 34% 34% 717 34% 34% 33% 32% III (#1) 700 687 677 650 600 2016 2017 2018 2019 2020 1H21 2017 2018 2019 2020 1H21 Source: Private Banking Group (market share by number of customers) Performance and Market Position ■ Market Penetration: ranked #1 with 35% market share (12,204 customers) and Bt798bn AUM in 1H21 ■AUM Breakdown: Investment 65% and Deposit 35% ■ Focus Customers (Type of Customer): ➤ Sophisticated customers (over 70% of total customers); Non-Sophisticated customers ■Product Types and Services: Mass Collaborate with Lombard Odier to develop innovative products; build capability via staff trainings and regular workshops; offer advisory services with close CIO collaborations; and offer referral offshore investment services ➤ Key product and services: . . Financial Products and Services: Investment Advisory Non-Financial Products and Services: Family Wealth Planning & Real Estate Others: Financial Event & Privilege Note: * High Net Worth Individual = Individual wealth with KBank and its wholly-owned subsidiaries > Bt50mn K บริการทุกระดับประทับใจ KASIKORNTHAI Retail Business: Performance and Market Position Multi-Corporate Business Large Corporate Business Medium Business Bancassurance* (New Business, Total and Renewal Premium) ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Small and Micro High Net Worth Business Individual Affluent Middle Income Mass #1 in Mutual Fund (KAsset) Mortgage Loan Ranked #1 in Mutual Fund AUM (KAsset) (% Market Share) Maintaining Top 3 with good quality portfolio (% Market Share) Ranked #2 in Total & Renewal Premiums and #3 in New Business (% Market Share) 35% 30% 29.7% 27.8% 28.5% 24.8% 30% 8.3% 9.5% 10% 24.4% 23.0% 21.8% 8.3% 25% 23.8% 20.1% 20%- 19.9% 16.6% 16.9% 20.2% 20.5% 20.1% 22.1% 21.9% 7.4% 7.7% 15.8% 16.3% 15,2% 20% 15% 5% 10% 10% (#1) (#1) (#1) (#1) (#1) (#3) (#3) (#3) (#3) (#3) 5% 0% 0% 0% 2017 2018 2019 2020 ■New Business Total Premium 1Q21 Renewal Premium 2017 2018 2019 2020 1H21 2017 2018 2019 2020 1Q21 51 Performance and Market Position ■Strong Growth in Retail Segment: Higher growth than market size in retail customers. KBank's retail customers grew 8% YoY in 1Q21. Bancassurance: MTL ranked #2 in total and renewal premiums with market share of 16.3%, and 16.9%, and also ranked #3 in new business with 15.2% market share in 1Q21. A variety of life and non-life products were offered to customers, together with an alternative digital channel via K PLUS. Moreover, coverage for COVID-19 vaccine allergies was offered to customers who renewed or took out COVID-19 insurance Fund Management Services Mutual Funds: KAsset maintaining #1 position since 2010, with highest market share at 21.9% in 1H21. ■Mortgage Loans: ranked in top 3, with 9.5% market share in 1Q21, expanding into high potential customers with conservative growth together with strengthening partner relationships and maintaining good portfolio quality. Credit Cards: ➤ Purchase spending: ranked #1, with 20.1% market share in 1Q21. Number of cards: ranked #2, with 13.3% market share in 1Q21. Card-accepting merchant services (online & offline platforms): ranked #1, with more than 32% market share by sales volume in 1Q21. Debit Cards: #1 in total debit card spending with 54% market share in 1Q21; maintain top position by providing functions, features, security, and benefits to match customer lifestyles Variety of cards and campaigns offered to promote greater card spending in several categories, such as travelling, online shopping, and food delivery, including attractive cards with privileges for specific groups; i.e. MADCARD for Kerry Express, JOURNEY Card, Line BK. Note: * Total Premium = New Business Premium (NBP) + Renewal Premium; New Business Premium = First Year Premium (FYP) + Single Premium (SP) บริการทุกระดับประทับใจ 62 52#27K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KBank and MTL Enter the 10 Years Bancassurance Agreement ■This transaction is a connected transaction, per Thai regulations, as it is conducted with MTL. This transaction does not require shareholder approval at the Shareholders' Meeting as it is a normal business transaction conducted with general trading conditions. ■ KBank deems this transaction as a very important transaction. As such, KBank wants to solicit shareholder participation in the decision so as to enhance transparency and be consistent with good corporate governance practices. ■KBank's Board of Directors resolved to submit the transaction for shareholder approval at the Extraordinary General Meeting of Shareholders on August 26, 2021. ■KBank views the continuity of distributing the life insurance products of MTL according to this new Bancassurance Agreement, will: Provide maximum benefits to KBank's overall insurance business value; ➤ Provide more favorable conditions and greater benefits to KBank; ➤ Continue the cooperation through a 10-years relationship with MTL, a leading life insurance company; Cause no disruption in business operations with MTL and services provided to KBank customers. ■ KBank appointed three external independent advisors to provide opinions on the transaction Actuarial Advisor Willis Towers Watson I.IPH KBank's actuarial advisor to provide opinion on transaction value relative to market. IFA JC Jay Capital Advisory JT KBank's independent financial advisor (IFA) to provide opinions for Shareholders' consideration. บริการทุกระดับประทับใจ Legal Advisor THANATHIP & PARTNERS KBank's legal advisor on terms and condition of bancassurance agreement. K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KBank: Risk and Credit Management 53 บริการทุกระดับประทับใจ 54#28K KASIKORNTHAI KBank Risk Management Structure ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK ■The Bank's organization is structured to facilitate all aspects of risk management; each business unit's responsibilities and segregation of duties are clearly identified in accordance with good internal-control practices ■ Approve risk appetite and all risk management policies and guidelines Board of Directors Risk Oversight Committee Audit Committee Operating Committee Credit Risk Management Sub-committee Credit Process Management Sub-committee Asset and Liabilities Management Sub-committee Market Risk Management Sub-committee Capital Management Sub-committee Operational Risk Sub-committee Business Continuity Management Sub-committee Information Technology Strategy Sub-committee Digital Oriented Risk, Data and Cyber Security - and IT Risk Management Sub-committee ■ Oversee effectiveness of consolidated risk management framework ■ Ensure effectiveness of overall risk management of the financial conglomerate ■ Establish risk management policies and risk appetites. Set risk limits for significant aspects of the various risks ■ Formulate strategy for the organization and resources to be used for the risk management operation, in line with the risk management policy. This strategy must enable the effective analysis, assessment, evaluation, and monitoring of the risk management system ■Credit Risk Management Sub-committee, Sustainable Development Sub- committee and Corporate Governance Committee oversee project financing requests that could have adverse impacts on the environment and society Business Units CBS/DNW/PBG/ CMB/IBB/WBG/CSI/ DAS/ICB/MMT/TWG/ CPD/TS/CSF/KBTG Risk Management and Control Function ERM Internal Audit ADD ■Business units are responsible for continuous and active management of all relevant risk exposure, to be in line with its returns and risk appetite ■Risk management is responsible for providing independent and objective views on specific risk-bearing activities to safeguard the integrity of the entire risk process. Control units are set to ensure that risk levels are in line with our risk appetite ■Internal Audit is independent and responsible for evaluation to add value and improve the effectiveness of risk management, control, and governance processes of the Bank and its subsidiaries CBS Corporate Business Division, DNW = Distribution Network Division, PBG = Private Banking Group, CMB = Capital Markets Business Division, IBB = Investment Banking Business Division, WBG World Business Group, CSI = Corporate Strategy and Innovation Division, DAS = Data and Analytics Division, ICB = Integrated Channels and Business Solutions Division, MMT = Marketing Management Division, TWG = Transaction and Wealth Banking Division, CPD = Credit Products Division, TS = Central Treasury Department, CSF = Customer and Enterprise Service Fulfillment Division, KTBG = KASIKORN BUSINESS - TECHNOLOGY GROUP, ERM = Enterprise Risk Management Division, ADD = Audit Division K KASIKORNTHAI KBank Credit Risk Management Process ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK The Bank continues to enhance credit risk management processes to promote risk strategies with justified risk-return tradeoff within the rapidly changing economic environment Portfolio Management ■ Determine portfolio-by-design taking into account risk-adjusted return trade-off ■Manage portfolio according to the Bank's risk appetite and concentration risk management (Country, Industry, Large Customer Group) ■ Perform stress testing to identify impacts to portfolio and proactively prepare appropriate management actions Origination Monitoring Collection & Recovery ■ Enhance decision making/support tools for more efficient return and risk evaluation ■ Setup specific prescreening criteria for potential industries ■ Enhance customer income validation process ■ Monitor customer behavior and detect early warning signs ■Leverage National Credit Bureau information for effective credit monitoring ■ Ensure credit condition compliance (e.g. insurance, capital injection, project progress) ■Take prompt action to prevent credit deterioration บริการทุกระดับประทับใจ ■ Efficient collection and follow-up of customers with late payments ■Restructure viable customers to prevent NPLs ■Foreclose pledged assets to recover loan loss 56#29Post Approval Approval Process k KASIKORNTHAI KBank Credit Approval Process Corporate Credit Underwriting Dept. Policy Lending ⚫ Sufficiency of cash flow • Growth trends and ability to compete • Management experience and depth SME (Medium) • Leverage, Liquidity, Asset Quality, ESG factors ⚫ Credit Risk Mitigation • Facilities Structure SME (Small & Micro) Retails (Housing) SME Credit and Housing Loan Approval Dept. Formula Lending • Customer Integrated Credit Scorecard • Application Score FICO Score • Bureau information/Credit history ⚫ Debt service capacity • LTV ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Retail (Unsecured Loans) Payment Service Fulfillment Department Formula Lending ⚫ Customer Integrated Credit Scorecard ⚫ Application Score • Transactional Score • FICO Score • Bureau information/Credit history ⚫ Debt service capacity ⚫ Legal document • Limit set up Note: FICO Fair Isaac Corporation Credit Service Fulfillment Dept. Bank-wide Risk Asset Review Payment Service Fulfillment Department ⚫ Legal document • Limit set up ⚫ Customer Review by Relationship Manager (RM) ⚫ Credit Monitoring and Asset Management Unit to facilitate RM in customer monitoring . Credit Clinic Asset Quality Management Operation Dept. • Automated collection system • Efficiently utilize available behavior scoring and collection tools i.e. SMS, automated letter generation, phone-based collection บริการทุกระดับประทับใจ K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KBank Credit Risk Management Process: Collection and Recovery Collection & Recovery Flow ■ Efficient collection and follow-up of customers with late payments ■ Restructure viable customers to prevent NPLs ■Foreclose pledged assets to recover loan loss Debt Resolutions Performing Loans Process Non-Performing Loans → Move to Better Status Move to Worsen Status Litigation Process Performing Loans* Debt Collections Rescheduled Loans* (Financial Aid Program) Repayment of Rescheduled/ Loans with DPD > 1 day go to debt collection stage Restructured Term NPL** Restructured Loans (Not classified as NPL) Relapsed NPL Write-off NPL Sales Note: * Rescheduled Loans are loans (no passed due date) that have changed payment conditions and not incurred losses. (Loans in the Financial Aid Program is a part of Rescheduled Loans) * Financial Aid Program helps customers during the bad macro business condition such as the big flood in 2011, the political unrest in 2014 and COVID-19 in 2020. * Performing loans = Pass Loans (loans passing the due date by less than 1 month) and Special Mention Loans (loans passing the due date by more than 1 month but not over 3 months) ** NPLs = Non-performing Loans loans passing the due date by more than 3 months = Sub-standard Loans, Doubtful Loans, Doubtful of Loss Loans, and restructured loans classified as NPL บริการทุกระดับประทับใจ 58 51 57#30K KASIKORNTHAI Litigation Process Litigation process in Thailand takes about 2-3 years Litigation Process Under Negotiation ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Period Negotiate, await approval, document preparation & lawyer process Approximately 2 months Pre-court (Notice) Issue notice & court filing Approximately 2 months In Court Trial / wait for court ruling Execution Collect payment ruled by court or foreclose Public Auction Liquidation process บริการทุกระดับประทับใจ Approximately 9-18 months Approximately 3 months Approximately 6-9 months K KASIKORNTHAI TFRS9: Asset Class and Expected Credit Loss Stage 1: Perform New or good assets ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Asset Class (Defined by Incremental Risks: New definition of SICR and Modified Loans) Stage 2: Underperforming Assets with "> 30 Days Past Due" or higher credit risk than origination capturing via risk information eg. Credit scoring, PD change etc. Expected Credit Loss (ECL): PD x LGD x EAD Incorporate forward looking over lifetime Macro-factor is captured through PD point-in-time Stage 3: Non-performing Defaulted assets 59 Probability of Default (PD) Stage 1: Performing 1 Year Define relevant economic factors & scenario Stage 2: Under-performing Lifetime Stage 3: Non-performing Lifetime Loss Given Default (LGD) Exposure at Default (EAD) Incorporate through PD point-in-time ■ Term structure PD is derived over behavioral life Derive term structure PD & ECL by scenario Weight with probability for final ECL ■ Multi-scenario is weighted to come up with final Expected Credit Loss (ECL) Incorporate recovery from both collateral and cash payment Combination of drawn and undrawn as credit exposure ■ It is an accounting complication to treat drawn ECL as assets contra and undrawn ECL as liabilities, while to risk, both are "credit exposure" ■ Drawn is "outstanding amount + EIR adjustment"; Undrawn is "outstanding amount x conversion factor" "Drawn" Principal + Accrued Interest +EIR adjustment "Undrawn" Notional x CCF 1) Contingent products: LI, LC 2) Committed unused facilities CCF could be regulatory CCF or behavioral CCF Note: Significant Increase in Credit Risk (SICR) reflects higher risk than origination, but not yet bad quality; modified loans are loans with changing terms and conditions, either good or bad; thus, it can be at any stage Drawn Loan amount that customer has already drawn down, which is booked under loans to customers or part of "Interbank and money market items" Undrawn = Credit facilities that are not utilized yet or credit facilities that are utilized but are booked as contingent liabilities, excluding derivatives EIR = Effective Interest Rate; LI = Letter of Indemnity; LC = Letter of Credit; CCF = Conversion Credit Factor บริการทุกระดับประทับใจ 60 60#31K KASIKORNTHAI Credit Bureau Summary National Credit Bureau (NCB)* Two Types of Credit Reports Offered by NCB: ➤ Consumer credit report for individuals ➤ Commercial credit report for businesses Credit report (monthly reported by members) ➤ Customer information (Name, address, identification number, birth date, occupation, etc.) ➤ Credit information (History of application, approval history, loan payment history, etc.) Data Record of Credit Report Individuals: Credit report remains on file for 3 years ➤ Businesses: Credit report remains on file for 3 years ■Members: Financial institutions including commercial banks, specialized financial institutions (SFIs), non-bank financial institutions, finance companies, securities companies, insurance companies, etc. ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KBank Practice KBank's customers applying for loans Optional to Sign agreement to allow the Bank (Large companies normally have reliable financial statements) Corporate Business to get credit report from NCB Required to SME Business Multi- Corporate Business Large Corporate Business Medium Business Small & Micro Business Good credit Poor credit KBank's Policy Lending Reject application Required to Retail Business 4 Customer Segments in Retail (HN, AF, MI and MA) Good credit Poor credit KBank's Credit Scoring Reject application Note: * The concept of a credit bureau started in 1961 and central credit registration started in 1964. The Central Information Service was established in 1999 and its name was changed to Central Credit Information Service in 2000 and to the National Credit Bureau in 2005 บริการทุกระดับประทับใจ 61 K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KBank: Continuity and Resiliency during COVID-19 Situation KBank takes holistic measures to ensure business continuity and resiliency during COVID-19 situation. Therefore, no COVID-19 spread or any key business disruption. • Incident Response Team (IRT) to manage overall situation/incidents COVID-19 Incident Management PROTECT Provide Protective Equipment e.g. mask, gel, face shield Launch Staff Measures & K-Tips e.g. protective measures • Report/Escalate to Executives e.g. key situation, action, criteria Increase Cleaning Cycle at frequently touched areas e.g. lifts, doors Install Thermo Scan at Key Buildings Maintain Social Distance e.g. workspace, work from home Restrict or Screen Vendors/ Visitors MONITOR RESPONSE Business Continuity Plan (BCP) Internal Provide Contact Channels for Staff to inform suspected cases External Closely monitor situation, impacts, and key actions; daily reports to executives Set up dedicated team to cope with COVID-19 infection incidents e.g. Building - deep cleaning Communication - internal and external via related channels People - provide medical support for infected staff; self quarantine for staff at risk with health report Define key criteria with actions - Workmode (Lean, Critical, Barebone) Note: VPN Virtual Private Network Key Scenarios and Actions for COVID-19 . Update Barebone & Key Activities with key staff Split Site and Provide VPN for key staff Secure Accommodation/Transportation for key staff บริการทุกระดับประทับใจ 62 62#32K KASIKORNTHAI Proactive financial relief programs and thereafter ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK ■ Proactive financial relief programs to mitigate adverse impact from COVID-19 pandemic Relieve Broad-based financial relief measures ■ Proactive relief measures to customers with adverse impact from COVID-19 outbreak Financial relief measures For Business 6-month payment period (Payment Holiday or known locally as Debt Holiday) Financial aids programs i.e. payment deferral of principal and/or interest Liquidity injection programs such as BOT soft loans, etc. For Individual Reduce minimum payment for unsecured products Refine Proactive monitoring & customized measures ■ Proactive monitoring with an enhancement on data-driven risk- based analytics to better identify customer at risk and appropriate financial relief measure Revive Converge to new normal ■Lending business expansion with new lending capability leveraging data analytics Can pay DEBT Target Port Lead Reach Generation Marketing & Offering Credit Assessment Monitoring & Collection 000A 0000 PAY Proactive customer Can't pay management with data- driven risk- based customer analytics Provide appropriate relief measures / Expected Outcome Wider Customer Reach Higher Conversion Optimized Risk Return Faster Time to Market Payment deferral of principal and/or interest restructuring / NPL บริการทุกระดับประทับใจ 63 K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Proactive risk management to counter economic slowdown and high household debt ■Continue to deploy proactive credit portfolio / risk management / asset quality management to mitigate an adverse impact from prolonged economic recovery and high household debt Corporate Business SME Business Retail Business ■ Focus on high potential industries less impacted by economic slowdown ■ Closely monitor customers in high risk industries and supply chains > Actively monitor early warning signs ➤ Promptly respond to adverse events ■Selective on quality of customers ■Proactive risk management by visiting customers; raise productivity of sales teams and relationship managers ■Efficient collection process ■Selective on high-value customers regarding prevailing BOT regulations and the Bank's policy ■ Proactive and efficient collection process based on the Bank's models ■ Analyze behavior regularly to identify weak spots บริการทุกระดับประทับใจ 64 70#33K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KBank: Financial Aid Programs during COVID-19 for Businesses ■ Offer financial aid programs to help SME and retail customers during the COVID-19 pandemic 1Q20 2Q20 May Oct 20 Debt Holiday* 3Q20 4Q20 1Q21 2Q21 3Q21 Jul 21 2-month Debt Holiday 4Q21 Credit Adjustment (Payment deferral and/or interest rate reduction) 6-month grace period on principal and interest payments for SMEs with credit lines below Bt100mn (Automatic adjustment) Feb 20-Jun 21 Up to 12-month grace period on principal payments for SMEs (Registration has been ended on June 30, 2020) Apr - Dec 20 "Generous (Business) Owners-Empathetic Creditor" program: a cooperative effort between KBank and business operators to reduce interest rates for 6 months For July and August Loans for SMEs GSB Soft Loans: Up to 5-year terms with Bt20mn loan limit for each SME, at 2% for 2 years BOT Soft Loans*: Up to 7-year terms for SMEs with credit limit below Bt500mn, at 2% for 2 years and 6 months interest free Loans guaranteed by Thai Credit Guarantee Corporation (TCG): with up to 7-year terms "Zero Interest-rate Loan to Retain SME Staff" program: 0% interest rate with 10- year terms and 1- year grace period on debt repayments for the first year Loans against mutual funds: Short-term loans for mutual fund holders; mutual fund units can be used as collateral, with a limit from Bt30,000 to 80% - 95% of the funds' NAV, at 2% to 5.5% interest for 6-month to 1-year period Apr 21 BOT Asset Warehousing**: Debt restructuring through Asset Warehousing with buy- back options within 3-5 years BOT Soft Loans supported by TCG credit guarantee scheme**: Up to 7-year terms, at average interest rate of 5% p.a. for five years (2% for the first 2 years) with 6 months interest free Note: According to the Emergency Decree on Financial Assistance to Enterprises affected by COVID-19 (B.E. 2563), dated April 18, 2020. **According to the Emergency Decree on Financial Rehabilitation and Recovery to support Businesses affected by COVID-19 (B.E. 2564), dated April 19, 2021. บริการทุกระดับประทับใจ SME Loans: Loan limit of Bt300,000, at 3% with up to 5-year terms, 3-month grace period on principal 64 65 K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KBank: Financial Aid Programs during COVID-19 for Individuals ■ Offer financial aid programs to help SME and retail customers during the COVID-19 pandemic The First Phase • Payment deferral 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 Credit card*: Reduce minimum installment payment to 5% in 2020-21 and 8% in 2022, returning to 10% in 2023 Xpress Loan and KLeasing: Payment reduction • Interest rate reduction 3-month grace period on principal and interest payments Credit card and Xpress Cash: Grace period on principal payments 4Q21 The Second and Third Phases for Individual • Payment deferral • Payment reduction • Interest rate reduction • Term loan extension * Customers can choose only one option depending on their debt service capability Housing Loan: Up to 12-month grace period on principal payments or 50% reduction in installment payments for up to 12 months Lower interest rate ceiling*: Credit Card (from 18% to 16%); Xpress Cash and Xpress Loan (from 28% to 25%); KLeasing (from 28% to 24%) Credit card, Xpress Cash, and Xpress Loan: 6-billing cycle grace period on principal (Option 1) Xpress Loan: 30% reduction in installment payments for 6 billing cycles, at special interest rate of 22% (Option 2) KLeasing Hire Purchase and Financial Lease: 50% reduction in installment payments for 6 months and extension of term loan for another 3 months (Option 2) Xpress Loan (Long-Term Loan) and Housing Loans: Grace period on principal for 3 months (Option 1); with 0.1% reduction in interest rate for 3 months for HL Reduction in installment payments for 3 months (Option 2): 30% for XPL and 50% for HL Grace period on principal and interest payments for 3 months (Option 3) KLeasing Hire Purchase and Financial Lease: Grace period on principal and interest payments for 3 months Credit card and Xpress Cash: Change to 48-month term loan, at special interest rate of 12% for credit card and 22% for Xpress Cash (card will be closed) (Option 2) KLeasing Car to cash (Car registration Loan): 30% reduction in installment payments with maximum interest rate <22% Debt Consolidation: Consolidate KBank's loans, with Credit Cards, Xpress Cash and Xpress Loan, by utilizing existing Home Loan's collateral for new loan from debt consolidation's collateral Debt Consolidation 2-month Debt Holiday* For customers effected from the lockdown in July 2021 Note: *Customers who are currently in other relief programs of KBank, are also able to apply to this program. ** Automatic adjustment for all customers บริการทุกระดับประทับใจ Credit card, Xpress Cash, Xpress Loan, Xpress Loan (Long- Term Loan) and Housing Loans 99 66#34K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KBank: Financial Performance Note: The Bank and its subsidiaries have adopted new accounting standards (TFRS 9: Financial Instruments) since January 1, 2020 onwards. Some financial statements and financial ratios are not comparable with previous years' financial figures before Y2020, which were based on the prior accounting standards (non-TFRS9) บริการทุกระดับประทับใจ K KASIKORNTHAI 1H21 Performance Highlights ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK 67 Consolidated Net Profit (Bt bn) Profitability - NIM - ROE* - ROA - YTD Loan growth - YoY Non-interest income growth - YoY Loan growth - YoY Net fee income growth Cost control - Cost to income Asset quality - NPL ratio - Credit Cost -Coverage ratio Loans to Deposits Tier 1 Ratio CAR 6.57% (4.28%) 2019 2020 1Q21 2Q21 38.73 29.49 10.63 8.89 1H21 19.52 3.31% 3.27% 3.16% 3.22% 9.90% 7.10% 9.57% 8.11% 3.20% 8.87% 1.20% 0.85% 1.14% 0.93% 1.03% 4.59% 12.13% 2.56% 6.17% 6.17% 4.59% 12.13% 12.69% 12.06% 12.06% (3.61%) (10.17%) 1.51% (20.65%) 6.56% 19.30% 6.57% (20.96%) 45.32% 45.19% 41.30% 41.78% 41.54% 3.65% 1.74% 148.60% 149.19% 3.93% 2.05% 3.93% 1.52% 153.98% 96.62% 95.73% 95.91% 16.19% 16.13% 15.80% 19.62% 18.80% 18.44% 3.95% 1.85% 154.09% 96.07% 15.86% 18.19% 3.95% 1.68% 154.09% 96.07% 15.86%. 18.19% Note: Under Bank of Thailand regulations, net profit in the first half of the year is counted as capital after approval by the Board of Directors as per Bank regulations. Net profit in the second half of the year is counted as capital after approval of the General Meeting of Shareholders. However, when a net loss occurs, the capital must be reduced immediately Capital Adequacy Ratio (CAR) has been reported in accordance with Basel III Capital Requirement from January 1, 2013 onwards. CAR is based on KASIKORNBANK FINANCIAL CONGLOMERATE. KASIKORNBANK FINANCIAL CONGLOMERATE means the company under the Notification of the Bank of Thailand re: Consolidated Supervision, consisting of KBank, K Companies, and subsidiaries operating in supporting KBank, Phethai Asset Management Co., Ltd., and other subsidiaries within the permitted scope of the BOT's definition to be a financial conglomerate * ROE = Net profit (attributable to equity holders of the Bank) deduct dividend from other equity instruments after income tax divided by average equity of equity excluded other equity instruments บริการทุกระดับประทับใจ ■1H21 net profit increased 104.40% YoY, mainly due to lower expected credit losses and higher EBPT. ■1H21 EBPT increased 2.90% YoY, mainly due to higher net interest income from continual loan growth despite lower interest rate. 1H21 loans grew 6.17% YTD, mainly from COVID-19 relief measures (mainly from SMEs), housing loans, corporate business, and retail lending using data analytics capability. ■NIM was 3.20%, decreasing YoY, mainly due to lower yield on loans from interest rate cut, deterioration of asset quality, and loans in relief measures despite lower cost of funds. 1H21 net fee income rose 6.57% YoY, mainly from fund management business and brokerage fees. ■1H21 cost to income ratio was 41.54%, decreasing YoY from an increase of net total income; cost to income will rise seasonally in 2H21. 1H21 NPL ratio was at 3.95%, with 154.09% coverage ratio. 1H21 capital base remained adequate. 68#35K KASIKORNTHAI Consolidated Financial Statements ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK 2019 2020 1Q20* 2Q20 3Q20 4Q20 1Q21 2Q21 1H21 Interest income 130,178 127,592 33,779 31,954 31,386 30,473 31,972 33,605 65,577 Interest expenses 27,490 18,570 5,697 4,872 4,131 3,870 3,840 3,888 7,727 Interest income - net 102,688 109,022 28,082 27,082 27,255 26,603 28,133 29,717 57,850 Fee and service income 50,580 45,699 12,335 10,930 10,854 11,580 12,615 11,839 24,454 Fee and service expenses 13,840 12,695 3,485 2,883 3,048 3,278 3,184 3,264 6,448 Fee and service income - net 36,740 33,004 8,850 8,047 7,805 8,302 9,431 8,575 18,007 Gain (Loss) on financial instrument measured at FVTPL 8,119 (300) 4,723 518 3,178 1,812 1,202 3,015 Gain (Loss) on trading and foreign exchange transactions 8,362 Gain (Loss) on investments Net premium earned Total operating income 8,412 1,308 144 205 364 595 116 330 446 80,490 72,129 15,796 18,092 17,887 20,354 16,686 17,264 33,950 241,144 227,456 53,650 59,306 54,677 59,823 57,212 58,206 115,418 Underwriting expenses 80,653 72,565 15,597 18,132 17,923 20,912 17,184 17,351 34,536 Total operating income - net 160,491 154,891 38,053 41,174 36,754 38,911 40,028 40,855 80,882 Total other operating expenses 72,729 69,997 17,481 15,796 16,447 20,272 16,531 17,069 33,600 Expected Credit Loss 43,548 11,872 20,192 10,815 669 8,650 10,807 19,457 Impairment loss of loans and debt securities 34,012 Operating profit before income tax expenses 53,750 41,347 8,699 5,186 9,491 17,970 14,846 12,979 27,825 Income tax expenses 10,309 7,656 1,349 901 2,048 3,358 3,035 2,548 5,583 Net profit attributable: Equity holders of the Bank 38,727 29,487 7,375 2,175 6,679 13,258 10,627 8,894 19,521 Non-controlling interest 4,714 4,203 (25) 2,110 765 1,353 1,184 1,537 2,721 Statements of Financial Position (Bt mn) 2019 Loans to customers (less deferred revenue) Total Assets Deposits Total Liabilities Total Equity attributable to equity holders of the Bank 2020* 1Q20* 2,001,956 2,244,821 2,043,093 2,126,753 3,293,889 3,658,798 3,483,527 3,585,800 2,072,049 2,344,998 2,202,112 2,307,997 2,840,174 3,167,512 3,033,814 3,135,108 406,358 439,670 406,789 402,386 2Q20 3Q20 4Q20 1Q21 2Q21 1H21 2,156,650 2,244,821 2,302,352 2,383,320 2,383,320 3,545,648 3,658,798 3,767,115 3,886,863 3,886,863 2,273,850 2,344,998 2,400,615 2,480,781 2,480,781 3,089,066 3,167,512 3,260,149 3,373,323 3,373,323 408,716 439,670 452,029 456,829 456.829 Note: - KBank acquired additional ordinary shares in MTGH, to hold a 51% stake valued at Bt7,529mn; the MTGH Acquisition was completed on November 30, 2009. As the MTGH acquisition was completed on November 30, 2009, the Bank's consolidated financial statements from 2010 include the performance of companies in the MTGH Group for the whole year. * The Bank restated the 1Q20 financial statements from the reclassification of investment in fund/ REIT to investments in FVOCI to comply with the Federation of Accounting Professions' announcement on 25 June 2020 and reclassification some items which did not impact to total assets, total liabilities and total equity. บริการทุกระดับประทับใจ 69 K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Earnings Before Provision and Tax (EBPT) and Net Profit June 2021 (Consolidated) EBPT Net Profit I 100 (Bt bn) 90.48 (Bt bn) 87.14 87.76 84.90 60 I 38.46 38.73 80 47.28 34.34 40 29.49 60 19.52 40 20 20 0 0 2017 2018 2019 2020 1H21 2017 2018 2019 2020 1H21 1H21 EBPT grew 2.90% YoY, mainly due to higher net interest income from continual loan growth despite lower interest rate. 1H21 net profit increased 104.40% YoY, mainly due to lower expected credit losses and higher EBPT. EBPT (Bt bn) 2017 90.48 EBPT Growth (% YoY) 2018 87.14 87.76 1.05% (3.70%) 0.72% 2019 2020 1H20 1H21 1Q21 2Q21 84.90 45.95 47.28 (3.27%) 6.50% 2.90% 23.50 14.22% 23.79 (6.27%) Net Profit (Bt bn) Net Profit Growth (% YoY) 34.34 (14.53%) 38.46 12.00% 38.73 0.70% 29.49 (23.86%) 9.55 19.52 10.63 8.89 (52.18%) 104.40% 44.10% 308.86% ---- Note: * The Bank restated the 1Q20 financial statements from the reclassification of investment in fund/ REIT to investments in FVOCI to comply with the Federation of Accounting Professions' announcement on 25 June 2020 and reclassification some items which did not impact to total assets, total liabilities and total equity. บริการทุกระดับประทับใจ 70 70#36K KASIKORNTHAI Interest Income - net June 2021 (Consolidated) Interest Income and Interest Expenses ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Interest Income - net (Bt bn) 140.00 119.34 123.92 130.18 127.59 (Bt bn) 109.02 94.16 98.54 102.69 100.00 120.00 100.00 80.00 57.85 80.00 65.58 60.00 60.00 40.00 40.00 25.18 25.38 27.49 18.57 20.00 7.73 20.00 0.00 0.00 2017 2017 2018 2019 ■Interest In come 2020 Interest Expenses 1H21 2018 2019 2020 1H21 Interest Income - net 1H21 net interest income slightly rose 4.87%, mainly from continual loan growth despite lower interest rate, while NIM dropped mainly due to lower yield on loans from interest rate cut, deterioration of asset quality, and loans in relief measures despite lower cost of funds. Interest Income (Bt bn) Interest Expenses (Bt bn) Interest Income - net (Bt bn) Interest Income - net (% Growth YoY) 2017 2018 2019 2020 1H20 1H21 1Q21 2Q21 119.34 123.92 130.18 127.59 65.73 65.58 31.97 33.60 25.18 25.38 27.49 18.57 10.57 7.73 3.84 3.89 94.16 5.00% 98.54 4.65% 102.69 4.21% 109.02 6.17% 55.16 I 8.12% 57.85 4.87% 28.13 I 29.72 0.18% 9.73% Note: Contributions from MTL's insurance business to KBank include non-interest income (e.g. net-premium earned-net), and interest income (e.g. interest income from investment portfolio); however, all income sources from MTL will be netted with non-controlling interests. บริการทุกระดับประทับใจ K KASIKORNTHAI Non-interest Income and Structure June 2021 (Consolidated) Non-interest Income to Average Assets ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK 71 Non-interest Income Structure Net Premium Earned and Underwriting Expenses (%) (Bt bn) 120 (Bt bn) 99.79 91.43 100 93.85 87.90 3 2.18 1.88 1.79 65 62.70 (-2%) 80.49 80.65 80 72.13 72.57 56.95 2 1.32 1.22 57.80 (+2%) 3% 60 40 33.95 34.54 1 55 45.87 1 20 (-21%) 0 0 45 2017 2017 2018 2019 2020 1H21 2018 2019 66% 35 64% 67% 1H21 2020* Net Premium Eamed Underwriting Expenses Net Premium Earned - net Non-interest Income Ratio 25 72% 23.03 (-4% YoY) 5% (Bt bn) 14- 15432 (%) 9% 60 15 6% 0.1% 78% 3% 50 6% 0.1% 5% 15% 5% 40 3% 37 36 5 9 5.94 4 3.54 13% 16% 14% 40 30 18% 2% 28 -1% 30 5.3% -0.4% -1% 13% -3% -1 -5 2017 2018 2019 2020* 1H21 2017 20 -0.16 -0.44 -0.59 2018 2020* 2019 Net Premium Eamed - net 1H21 10 0 Gam on finand alinstument measured at PVTPL (Gan on Trading and FX tansactions old) Share of Profit from Investments on Equity Methad Net Pt em um Earned- net Fee and Service Income-nd Gain on Investment Dividendiname 2017 2018 2019 2020 1H21 Contributions from MTL's insurance business to KBank include non-interest income (e.g. net-premium earned- net), and interest income (e.g. interest income from investment portfolio); however, all income sources from MTL will be netted with non-controlling interests. Non-interest Income (Bt bn) Non-interest Income Growth (%YoY) Non-interest Income Ratio (%) 2017 62.70 (1.62%) 39.97 2018 56.95 (9.17%) 2019 57.80 2020 45.87 1H20 24.06 1H21 23.03 1.51% (20.65%) 36.62 36.02 29.61 (7.00%) 30.37 (4.28%) 1Q21 11.89 19.30% 2Q21 11.14 (20.96%) 28.48 29.72 27.26 Note: - Non-interest Income Ratio = Non-interest Income/Total Operating Income - net - Net Premium Earned - net = Net Premium Earned less Underwriting Expense - The Bank and its subsidiaries have adopted TFRIC 13: Customer Loyalty Programmes since January 1, 2014 onwards * The Bank and its subsidiaries have adopted new accounting standards (TFRS 9: Financial Instruments) since January 1, 2020 onwards, some financial statements and financial ratios are not comparable with previous years' financial figures before Y2020, which were based on the prior accounting standards (non-TFRS9). ** The Bank restated the 1Q20 financial statements from the reclassification of investment in fund/ REIT to investments in FVOCI to comply with the Federation of Accounting Professions' announcement on 25 June 2020 and reclassification some items which did not impact to total assets, total liabilities and total equity. บริการทุกระดับประทับใจ 72#37K KASIKORNTHAI Net Fee Income June 2021 (Consolidated) (Bt bn) 41.31 Net Fee Income ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Net Fee Income to Net Total Operating Income (%) 30 26% 25% 23% 21% 22% 40 30 20 38.12 36.74 33.00 20 18.01 10 10 0 2017 2018 2019 2020 1H21 0 2017 2018 2019 2020 1H21 ☐ 1H21 net fee income rose 6.57% YoY, mainly from fund management business and brokerage business; while fee from money transfer decreased ■Net fee income to net total operating income was 22.26% in 1H21. 2017 2018 2019 2020 1H20 1H21 1Q21 2Q21 Fee Income (Bt bn) 51.76 51.19 Fee Income-net (Bt bn) 41.31 38.12 50.58 36.74 45.70 23.27 24.45 12.62 11.84 33.00 16.90 18.01 9.43 8.58 Fee Income Growth (%YoY) Net Fee Income Growth (% YoY) Net Fee Income to Net Operating Income Ratio (%) 6.43% 6.07% 26.33 (1.10%) (1.19%) (7.72%) (3.61%) 24.52 22.89 (9.65%) (10.17%) 21.31 (5.35%)! (5.48%) 6.57% 21.33 22.26 5.11% 2.27% 8.32% 6.56% 6.57% 23.56 20.99 Note: - On the consolidated basis, Bancassurance fees are not included in net fee income since November 30, 2009, due to the elimination of inter-company transactions (the accounting treatment from the Muang Thai Group Holding consolidation) * The Bank and its subsidiaries have adopted new accounting standards (TFRS 9: Financial Instruments) since January 1, 2020 onwards, some financial statements and financial ratios are not comparable with previous years' financial figures before Y2020, which were based on the prior accounting standards (non-TFRS9). บริการทุกระดับประทับใจ K KASIKORNTHAI Net Fee Income Structure June 2021 (Consolidated) Net Fee Income by Product ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Others 10% Brokerage business 9% Fund Management Business 26% Trade finance 6% Credit Card Business 12% Transaction services 17% Commercia I credit 16% Cash management 4% ■Credit Card Business (mainly from credit card, merchant fees) ■Transaction services (such as ATM & debit cards, bill payments, money transfers, etc.) ■Commercial credit (mainly from commercial credit related fees) Cash management (such as fees from payroll accounts) ■Trade finance ■Fund Management Business (mainly from mutual fund and securities service fees) ■Brokerage business ■Others (such as capital market business, etc.) Loan Related and Non-loan Related Fees - net Loan related 13% Non-loan related 87% Note: - On the consolidated basis, Bancassurance fees are not included, due to the elimination of inter-company transactions (the accounting treatment from the Muang Thai Group Holding consolidation) - On the consolidated basis, Net Premium Earned - net (Net Premium Earned Less Underwriting Expenses) from Muang Thai Life Assurance (MTL) is reported as a part of non-Interest Income; KBank has a 38.25% economic interest in MTL - The Bank and its subsidiaries have adopted new accounting standards (TFRS 9: Financial Instruments) since January 1, 2020 onwards, some financial statements and financial ratios are not comparable with previous years' financial figures, which were based on the prior accounting standards (non-TFRS9) บริการทุกระดับประทับใจ 73 74#38K KASIKORNTHAI Other Operating Expenses June 2021 (Consolidated) Other Operating Expenses Structure ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK (Bt bn) 72.73 70.00 68.35 70 66.37 29% Others 29% 60. 28% 27% 0.2% 50 0.2% 0.2% 0.2% 7% ■Directors' remuneration 7% 7% 7% 40 18% 19% 17% 19% 33.60 Taxes & Duties 30- 25% 0.3% 8% 20 17% Premises & Equipment 47% 46% 46% 46% 10 50% 0 2017 2018 2019 2020* 1H21 ■Employee's expenses 1H21 other operating expenses slightly increased 0.97% YoY, mainly due to an increase in employee expenses, while premises and equipment expenses, and marketing expenses and debt management expenses decreased; continued to focus on cost and productivity improvement and new investments for future growth. Other Operating Expenses (Bt bn) Other Operating Expenses Growth (%YoY) 2017 2018 2019 2020 1H20 66.37 68.35 72.73 70.00 33.28 1H21 33.60 1Q21 16.53 2Q21 17.07 3.94% 2.98% 6.41% (3.76%) (1.41%) i 0.97% (5.44%) i 8.06% Note: *The Bank and its subsidiaries have adopted new accounting standards (TFRS 9: Financial Instruments) since January 1, 2020 onwards, some financial statements and financial ratios are not comparable with previous years' financial figures before Y2020, which were based on the prior accounting standards (non-TFRS9). บริการทุกระดับประทับใจ K KASIKORNTHAI Loan Structure and Loan Growth June 2021 (Consolidated, TFRS 8: Operating Segments*) Loan Portfolio Structure ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Loan Portfolio Bt bn 2,400 Consolidated 2,245 2,383 Amount (Bt bn) Dec 20 Jun21 1H21 1H21 Y2021 Loan Growth Yield Range Loan Growth Target 2,000 1,803 1,914 2,002 36% 35% 1,600 35% 36% 34% 1,200 800 400 36% 35% 34% 33% 24% 25% 28% 0 5% 2017 4% 4% 2018 2019 2020 28% 3% 33% 29% 3% 1H21 Corporate ■SME ■Retail Others (%) (%) Corporate Loans 814 834 2.5% 2-4% SME Loans 733 782 6.7% 5-7% (%) 1-3% 2-4% Retail Loans 638 695 8.9% 5-7% 11-13% Other Loans Total Loans 60 2,245 72 19.6% 2,383 6.2% 4.6% 4-6% Loan Growth (% YoY) Note: From time to time, the Bank has adjusted loan definitions based on loan portfolio management; thus, the latest loan base is not comparable with previous reports. Loan by Retail Products (All Segments) (%) 15 (Amount in Bt bn) Dec 20 Jun 21 Y2020 12.13 12.06 Loan Growth 10 6.20 6.17 4.59 5 (%) 1H21 Loan Growth (%YTD) % Portion to Total Loan Housing Loans 390 423 19.9 8.4 17.8 0 Credit Cards Consumer Loans KLeasing 91 88 5.8 (3.7) 3.7 91 118 17.1 30.2 5.0 115 115 0.1 0.0 4.8 2017 2018 2019 2020 1H21 Loans (Bt bn) 2017 1,803 2018 2019 2020 1,914 2,002 2,245 1H20 2,127 1H21 2,383 Loan Growth (% YoY) Loan Growth (% YTD) 6.20% 6.20% 6.17% 6.17% 4.59% 4.59% 12.13% 12.13% 10.01% 6.23% 12.06% 6.17% 1Q21 2,302 12.69% 2Q21 2,383 12.06% 2.56% 75 Note: *Since 1Q13, as per the Bank of Thailand's requirement, the Bank has complied with TFRS 8 (Operating Segments) to present operating results for each key segment in financial reports. Loan Definition 6.17% Corporate Loans: Loans Loans of KBank and KBank's Subsidiaries in Corporate Segments (Annual sales turnover > Bt400mn); SME Loans: Loans in SME Segments (Annual sales turnover ≤ Bt400mn); Retail Loans: Loans in Retail Segments; Other Loans: Other Loans: Composed of loans through the insurance business (MTL), regional markets, and other loan types not directly attributable to the main business groups. Since Y2020 onwards, loans in Enterprise Risk Management Division (NPL + Performing Restructured Loans) were reclassified to their customer segments. - Housing Loans: KBank's housing loans to retail customer segments; Credit Cards: KBank's credit card loans to all eight customer segments; Consumer Loans: KBank's consumer loans to retail customer segments; KLeasing: KLeasing's loans to all eight customer segments บริการทุกระดับประทับใจ 60 76#39K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Loan Portfolio Breakdown by Industry, Currencies, and Interest Rate December 2020 (Consolidated) Loan Portfolio by Industry* By Residency of Borrowers (December 2020)* 2,500 (Bt bn) 2,245 2,002 2,000 1,914 1,803 16.8% ■ Others 1,527 1,610 1,698 16.3% 14.6% 1,500 1,439 14.2% 1,327 14.5% 11.6% 15.7% 4.2% 14.3% 4.29 7.2% Housing Loans 12.5% 4.89 5.5% 1,000 6.0% 13.0% 13.0% 6.7% 12.5% 6.9% 4.6% 14.7% 13.2% 6.6% 6.8% 13.7% 8.5% 4.9 6.2 13.5% 12.8% 8.9% 8.9% 14.2% Utilities & Services 8.6% Real Estate & Construction 6.5% 500 48.9% 48.9% 48.1% 49.1% 48.1% 47.3% 46.2% 46.2% 41.7% 2.4% 2.3% 2.0% 1.9% 2.1% 1.9% 0 2012 2013 2014 2015 1.8% 1.6% 2016 2017 2018 2019 2020 Manufacturing & Commerce Agricultural and Mining 1.7% Foreign 2.7% Domestic 97.3% Definition of Loans 1) by industry Gross loans Loans to customers less deferred revenue 2) by currency = Loans to customers and AIR - net 3) by maturity of interest repricing = Loans to customers less deferred revenue Loans by Bangkok and Metropolitan vs. Upcountry Proportion of KBank's Outstanding Loans 2014 2015 2016 2017 2018 2019 2020 1Q21 Bangkok and Metropolitan Upcountry 64% 64% 63% 64% 62% 59% 58% 63% 36% 36% 37% 36% 38% 41% 42% 37% By Maturity of Interest Repricing (December 2020)* > 6 months 16.2% Others 0.5% <=6 months 10.4% Note: *The information on loans breakdown by industry, residency of borrowers, and maturity of interest repricing are disclosed on half year basis Immediate repricing 72.9% K KASIKORNTHAI Asset Quality June 2021 (Consolidated) NPL Ratio บริการทุกระดับประทับใจ Coverage Ratio ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Classified Loans** (Bt bn) Stage 1 Performing (%) (%) 200 5 3.65 3.93 3.95 148.45 160.60 148.60 149.19 154.09 Stage 2 Under-performing 4 3.30 3.34 150- 3 Stage 3 Non-performing Total 100- 2 1 50- 0 0 2017 2018 2019 2020* 1H21 2017 2018 2019 2020* 1H21 1Q21 2Q21 2,004 2,398 206 214 105 110 2,315 2,721 NPL ratio in 1H21 was at 3.95%, with a coverage ratio of 154.09%. COVID-19 negatively affected asset quality; relief measures lessened the degree of impact in the short-term; overall NPL situation remains manageable; while, asset quality is closely monitored and constantly reviewed. 2017 2018 2019 2020 1H20 1H21 1Q21 2Q21 NPL Ratio (%) 3.30 3.34 Coverage Ratio (%) 148.45 160.60 3.65 148.60 3.93 149.19 3.92 155.68 3.95 154.09 3.93 153.98 3.95 154.09 SML to Total Loans Ratio (%)* 2.59 1.90 2.80 Loans with significant increase in credit risk (%) 7.80 9.43 7.85 7.88 7.85 L Note: The Bank and its subsidiaries have adopted new accounting standards (TFRS 9: Financial Instruments) since January 1, 2020 onwards, some financial statements and financial ratios are not comparable with previous years' financial figures before Y2020, which were based on the prior accounting standards (non-TFRS9). ** Loans to customers and accrued interest receivables: Under TFRS 9, the classified loans are defined by 3 stages based on incremental risks, which cannot directly compare with the previous number these were defined by days past due. บริการทุกระดับประทับใจ 77 78#40K KASIKORNTHAI Expected Credit Loss and Credit Cost June 2021 (Consolidated) Impairment Loss of Loans and Debt Securities ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Credit Cost Expected Credit Loss (Bt bn) (bps) I 50 41.81 43.55 350 40 32.53 34.01 300 239 250 30 19.46 200 20 150 100 10 50 ווווו 175 174 205 168 0 0 2017 2018 2019 2020 1H21 2017 2018 2019 2020 1H21 ■1H21 credit cost was at 168bps; conservative assumptions and prudent financial policy maintained amid high uncertainties related to COVID-19. Relief measures help limit short-term impacts on asset quality; asset quality is closely monitored and constantly reviewed. 2017 2018 2019 2020 1H20 1H21 1Q21 2Q21 Expected Credit Loss (Impairment Loss of Loans and Debt Securities) (Bt bn) 41.81 32.53 34.01 43.55 32.06 19.46 8.65 10.81 Credit Cost (bps) 239 175 174 205 311 168 152 185 L บริการทุกระดับประทับใจ K KASIKORNTHAI Bad Assets Resolution June 2021 (Consolidated) ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Write-offs (Bt bn) 28 24 20 16 12 85.5 4 0 4.3 3.9 5.0 10.3 7.3 26.4 21.5 19.9 10.7 10.1 9.6 Hill 6.2 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 NPL Portfolio Sales 2007: KBank and Phethai AMC sold NPLs totaling Bt11.4bn to Standard Bank Asia Limited and Morgan Stanley Emerging Markets Inc. at Bt7.6bn and Bt3.8bn, respectively 2008-1Q16: NPLs continued to decline without bulk NPL sales 2016: KBank sold NPLs worth Bt6.4bn (Bt4.9bn in 2Q16 and Bt1.5bn in 4Q16) to JMT Network Services PCL 2017: KBank sold NPLs worth Bt8.4bn in 4Q17 to asset management companies 2018: KBank sold NPLs worth Bt15.4bn (Bt7.3bn in 1Q18, Bt5.4bn in 3Q18, and Bt2.7bn in 4Q18) to asset management companies 2019: KBank sold NPLs worth Bt7.1bn (Bt4.3bn in 1Q19 and Bt2.8bn in 3Q19) to asset management companies 2020: KBank sold NPLs worth Bt6.8bn (Bt4.9bn in 1Q20 and Bt1.9bn in 4Q20) to asset management companies 1H21: KBank had no NPL sales Note: *On September 11, 2013, the Bank was formally notified of its final loss sharing portion under the asset transfer agreement with TAMC established in October 2001. This amounted to Bt206mn. An amount of Bt1,159mn relating to the provision for losses recorded in prior years has been reversed through profit or loss in 2013 Outstanding Foreclosed Properties Sales of Foreclosed Properties (Bt bn) 35.0 30.0 25.0 20.0 16.7 15.9 15.1 15.0 12.5 12.1 13.4 34 10.0 5.0 0.0 16.1 17.4 19.6 (Bt bn) 10 31.1 31.1 27.9 249 8 24.9 6 5.4 5.6 5.0 4.8 4.1 4.2 4.3 4 2.8 3.0 3.3 2.9 2.4 3.0 2 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 1H21 0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 1H21 บริการทุกระดับประทับใจ 79 80#41K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK TFRS 9: Investment in Securities Portfolio and Structure June 2021 (Consolidated) Instrument Type Financial Assets Classification Holding Type TFRS 9: Asset Type (Bt bn) (Bt bn) 945 1,000 1,000 777 945 900 777 824 0.5% 12% 663 0.3% 824 0.3% 0.3% 800 663 0.4% 800 0.1% 0.1% 0.2% 10% 700 536 0.3% 14% 13% 536 0.1% 0.7% 15% 0.2% 10% 600 0.4% 15% 19% 600 0.7% 0.2% 56% 52% 7% 500 12% 20% 0.5% 16% 9% 18% 54% 400 400 15% 56% 300 40% 63% 56% 38% 200 66% 53% 54% 200 64% 40% 43% 32% 100 6% 7% 3% 2% 0 0 2017 2018 2019 2020* 1H21* 2017 2018 2019 2020* 1H21* Other Investment (Investments in Receivables, Investments in Subsidiaries and Other Investments) Trading Held-to-maturity Equity Investment Investment in Receivables Available-for-sales General Investments Subsidiaries Foreign Bonds Corporate Bonds Investments Subsidiaries Amortized cost "Fair value through OCI Fair value through PL ■Goverment & State Enterprise Bonds ■KBank's guideline for investment portfolio management is to primarily maintain liquidity in order to support a future change in business conditions. In addition, an investment strategy was established in line with changes in economic conditions and the movement of money markets and capital markets both at home and abroad. Investment Portfolio (Bt bn) 2016 650 2017 2018 536 663 2019 777 2020 1H20 1H21 1Q21 2Q21 824 867 945 928 945 9.07% 17.85% 9.07% Investment Portfolio (% Growth YoY) 36.10% (17.52%) 23.51% 17.22% 6.15% 11.43% บริการทุกระดับประทับใจ K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Deposits Growth and Loans to Deposits Ratio June 2021 (Consolidated) Deposits & B/E (Bt bn) Loans to Deposits Ratio 81 2,100 1,995 1,879 1,800 1,500 1,200 900 600 300 0.3 0 0 2017 2018 2,700 2,400 LLLLL 1H21 0 | 2,481 100% 2,345 96.6% 2,072 96.0% 95.9% 96.1% 95.7% 95% 90% 0 2019 2020 85% 2017 2018 2019 2020 1H21 Loans to Deposits ■Deposits B/E Deposits and Loans to Deposits Ratio is in line with peers. Deposits (Bt bn) 2016 1,795 Deposits (% YoY) 2017 2018 1,879 1,995 6.2% 2019 2,072 2020 2,345 Deposits (% YTD) Loans to Deposits Ratio (%) 5.2% 4.7% 3.9% 5.2% 4.7% 6.2% 3.9% 94.6% 96.0% 95.9% 96.6% 95.7% 13.2% 13.2% 1H20 1H21 2,308 2,481 15.1% 7.5% 11.4% 5.8% 92.2% 96.1% 1Q21 2,401 2Q21 2,481 9.0% 7.5% 2.4% 5.8% 95.9% 96.1% บริการทุกระดับประทับใจ 82 62#42K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Funding Structure and Interest Rate Movement June 2021 (Consolidated) Funding Structure Deposit Structure (Bt bn) 2,800 2,502 2,705 (Bt bn) 2,3452,481 2,019 2,194 2,236 6% 2,400 1,995 2,072 4% 2,400 6% 4% 3% 2,000 1,879 20% 20% 3% 3% 24% 2,000 22% 4% 3% 4% 1,600 21% 1,600 1,200 92% 93% 1,200 75% 74% 93% 91% 94% 72% 71% CASA 800 800 = 80% 73% 400 400 0 2017 2018 2019 2020 1H21 0 6% 6% 6% 6% 6% 2017 2018 2019 2020 1H21 ■Deposits ■ST and LT Borrowings Interbank and Money Market Current ■Savings Term KBank Interest Rate Movement (Retail customers) ST and LT Borrowings 2896543 (%) 7 Deposit rates (%) (Mar 6, 2021) (Bt bn) Savings 0.25 100 82 Fixed 3M-12M 0.32-0.40 71 71 69 74 75 Fixed 24M-36M 0.45-0.65 100% 100% 84% 99% 86% 50 Lending rates (%) (May 22, 2020) 2 MLR 5.47 25 25 0.17% 1 0.38% 1.32% MOR 5.84 16% 0.19% 14% 0 0 2017 2018 2019 2020 1H21 2014 2015 2016 2017 2018 2019 2020 1H21 MRR 5.97 ■ST Borrowing ■B/E & Others LT Borrowing MLR Fixed3 M บริการทุกระดับประทับใจ K KASIKORNTHAI Long-term Senior/Subordinated Debentures Issue Date Name Long-term Subordinated Debentures ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Type Feature Amount Maturity Years Interest Rate Interest (Per annum) Payment period Credit Rating 10/08/2021 Additional Tier 1 Subordinated Notes* Unsecured Perpetual NC5.5Y USD350mm 4% Semi- annually Ba1 by Moody's 14/10/2020 Additional Tier 1 Subordinated Notes* Unsecured Perpetual NC5Y USD500mn 5.275% Semi- annually Ba1 by Moody's 02/10/2019 Tier II Subordinated Notes due 2031* Unsecured 12NC7 USD800mn 12 years (02/10/2031) 3.343% Semi- annually Baa3 by Moody's BB+ by Fitch Ratings 14/07/2016 Subordinated Instruments intended to qualify as Tier 2 Capital of KASIKORNBANK PCL No. 1/2016 due 2027 Unsecured 10.5NC5.5 Bt7,500mn 10.5 years (14/01/2027) 3.50% Quarterly AA- (tha) by Fitch Ratings Long-term Senior Debentures 07/12/2018 Floating Rate Notes due 2023* Unsecured USD15mn 5 Years (07/12/2023) 3m Libor+0.95% Quarterly 30/10/2018 Floating Rate Notes due 2023* (Sustainability Bond) Unsecured USD100mn 5 Years (30/10/2023) 3m Libor+0.95% Quarterly Baa1 by Moody's 12/01/2018 Senior Unsecured Notes due 2023* Unsecured USD400mn 5.5 Years (12/07/2023) 3.256% Semi- annually BBB+ by S&P BBB by Fitch Ratings 06/10/2016 Senior Unsecured Notes due 2022* Unsecured Baa1 by Moody's USD400mn 5.5 Years (06/04/2022) 2.375% Semi- annually BBB+ by S&P BBB by Fitch Ratings Note: *The issued notes are drawn from the Bank's USD 4bn Euro Medium Term Note Programme (EMTN) บริการทุกระดับประทับใจ 83 84 4#43K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KBank: The wholly-owned subsidiaries, and Muang Thai Life Assurance บริการทุกระดับประทับใจ 85 K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK The wholly-owned subsidiaries of KBank: Business Profile and Aspiration June 2021 Company Name Company Profile KAsset EST. 1992 KASIKORN ASSET MANAGEMENT CO., LTD. A leader in fund management business (i.e. mutual funds, provident funds, and private funds) KResearch EST. 1995 KASIKORN RESEARCH CENTER CO., LTD. Professional in providing knowledge in economics, business, money, and banking Only research house which is an affiliate of a bank KSecurities EST. Jul 2005 KASIKORN SECURITIES PCL Professional in providing a complete range of excellent financial solutions and services, including investment banking, securities underwriting, and securities brokerage KLeasing EST. Aug 2005 KASIKORN LEASING CO., LTD. Professional in providing three core products: hire purchase, financial lease, and floor plan KF&E EST. 1990 KASIKORN FACTORY AND EQUIPMENT CO., LTD. Professional in providing a complete range of machinery and equipment leasing services Asset Size Bt3.11bn Market Share 18% Bt0.15bn N/A Bt31.52bn 4% (#10) Bt114.41bn Bt25.24bn 7%* 17% 2021 Targets Maintain top tier position Top of mind research house for media and for the clients of KBank and its wholly- owned subsidiaries 3-year Aspiration Maintain top tier position Top of mind research house Maintain leading position in securities business under local bank parent Top of mind securities firm Maintain a good asset quality portfolio Provide complete range of financial solutions and maintain good asset quality Maintain top tier position and focus on good asset quality Maintain leading position in equipment leasing industry *KLeasing's Market Share as of Y2020 บริการทุกระดับประทับใจ 86#44K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK The wholly-owned subsidiaries of KBank: 1H21 Key Operating Performance June 2021 1H21 Key Operating Performance (Bt bn) KAsset EST. 1992 KResearch EST. 1995 KSecurities EST. Jul 2005 Assets Under Management Most quoted research (AUM): Bt1.57trn - Trading volume: Bt819bn house in the media (+10.76% YoY) - Number of customers grew 62% YoY KLeasing EST. Aug 2005 Outstanding loans: Bt114.86bn (+1.98% YoY) The wholly-owned subsidiaries of KBank: Net Profit 5.99 6 5.60 5.39 4.91 5 4.56 3.85 4 3.66 3.23 3 2.25 2 1 0 2012 2013 2014 2015 2016 2017 2018 2019 2020 KF&E EST. 1990 Outstanding loans: Bt25.26bn (+9.43% YoY) 3.77 Net profit continues to rise from the same period of 2020, increasing 36% YoY, along with synergy among KBank and its wholly-owned subsidiaries 1H21 บริการทุกระดับประทับใจ 87 K KASIKORNTHAI KAsset Highlights in 1H21 June 2021 (Bt bn) 10,000 8,000 หลักทรัพย์จัดการกองทุนกสิกรไทย 开泰基金管理 KASIKORN ASSET MANAGEMENT AUM (KAsset vs. Industry) (Bt bn) 2,000 6,959 7,173 8,279 7,737 8,634 6,000 6,368 5,118 5,534 1,500 4,000 2,576 2,883 3,015 4,253 3,633 946 851 1,090 1,132 1,240 1,303 1,380 1,431 1,477 1,568 1,000 2,000 742 635 509 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 1H21 500 Industry KAsset *2018-YTD include REITS Market Share by AUM Industry Outlook: ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK 2021 industry AUM at Bt8.63trn, increasing 21.10% YoY KAsset AUM at Bt1.57trn, increasing 10.76% YoY KAsset Highlights: Ranked #1 in Mutual Fund and #2 in Provident Fund with market share of 21.9% and 15.7%, respectively Ranked #2 in total AUM with market share of 18.2% ■Mutual fund accounts for 74% of KAsset AUM (%) 30.0 19.518.719.218.518.2 20.519.820.721.419.0 11.810.310.810.10.2 11.612.612.111.310.3 15.0 6.7 6.5 6.5 5.8 4.8 0.0 KAsset SCBAM KTAM MFC 2016 2017 2018 2019 1H21 37.5 29.932.130.732.3 BBLAM Other บริการทุกระดับประทับใจ KAsset AUM Breakdown by Type Provident Fund 13% Private Fund 13% Mutual Fund 74% 88#45K KASIKORNTHAI KResearch Highlights in 1H21 June 2021 ศูนย์วิจัยกสิกรไทย 开票研究中心 KASIKORN RESEARCH CENTER ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK 20,000 18,000 Number of News Quotes 16,000 14,000 12,000 10,000 8,452 7,672 7,910 8,000 6,000 4,000 2,000 14,532 11,500 18,047 10,052 2015 2016 2017 2018 2019 2020 1H21 KResearch Highlights: The most quoted private research house in Thailand Top of mind research house for the public, including clients of KBank and its wholly-owned subsidiaries Source News Center, isentia, IQnewsClip, etc. The number of quotes from the media newspapers online newspaper and other online news. (excluding magazines, TVs, and Radio) บริการทุกระดับประทับใจ 89 K KASIKORNTHAI KSecurities Highlights in 1H21 June 2021 (Bt bn) 30,000 25,000 หลักทรัพย์กสิกรไทย 开泰证券 KASIKORN SECURITIES Trading Volume (KSecurities vs. Industry)* KS CAGR Y2006-2020: 27% (Bt bn) 29,829 2,000 24,790 1,800 22,937 21,551 21,899 22,442 1,600 20,345 20,998 20,000 19,549 1,400 1,119 1,200. 15,000 13,772 1,296 1,251 12,377 860 868 1,000 12,486 812 10,000 7,967 8,544 7,962 8,640 739 688 800 817 430 819 600 411 5,000 400 207 41 91 117 200 0 0 Industry Outlook: ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK 1H21 industry trading volume* was Bt21.00trn, increasing 38% YoY KS trading volume was Bt819bn KSecurities Highlights: ■KS ranked #10, with 3.90% market share Majority of revenue came from brokerage Number of customers account grew 62% YoY to 302,922 customers in 1H21 (%) 10.0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 1H21 Total Industry Trading Volume KS Trading Volume Market Share by Trading Volume* 5.0 3.7 3.03.0 5.7 4.7 4.6 4.24.9 3.83.9 4.1 3.73.43.5 3.7 2.3 2.1 1.9 2.4 2.6 0.0 KS SCBS KTZ BLS 3.8 3.1 2.92.9 2.3 6.8 6.1 6.16.3 5.5 TNS MBKET 2017 2018 2019 2020 1H21 Note: Industry trading volume excluding proprietary trades บริการทุกระดับประทับใจ KSecurities Revenue by Business Investment Banking 10% Brokerage and other 90% 90#46K KASIKORNTHAI KLeasing Highlights in 1H21 June 2021 (Thousand Units) 1,500 1,331 ลีสซิ่งกสิกรไทย 开車租赁 KASIKORN LEASING KLeasing vs. Industry (Bt.bb 1,042 1,008 792 872 882 1,000 800 769 114.9 100 114.8 114.9 108.1 97.1 89.2 89.8 88.7 90.7 500 2013 2014 2015 2016 2017 Total Car Sales in Thailand 377 50 2018 2019 2020 1H21 Kleasing Outstanding Loans Market Share by Total Outstanding Loans (%)* Industry Outlook: ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK 1H21 industry car sales totaled 377,262 units, increasing 14.81% YoY KLeasing Highlights: 1H21 KLeasing loans totaled Bt114.86bn, increasing 1.98% YoY 1H21 KLeasing NPL ratio was 1.09%, lower than the Thai commercial bank average ratio KLeasing Outstanding Loans Breakdown** (%) 50 Floorplan 7% 30 31 28 28 28 27 27 29 29 29 25- Fleet/ 12 12 11 1111 14 15 16 16 16 Finance 8 8 8 9 9 88777 Lease 22% 0 TTB AYCAL TISCO SCB KK KLeasing Hire Purchase ■2017 2018 2019 2020 1Q21 71% Note: * Excluding captive and non-bank leasing; Lasted Data as of 1Q21 ** New car includes HP New car, Fleet finance, Finance lease (FL) and Floorplan Used car includes Car to Cash (K-Car / Car registration loan) and other used cars บริการทุกระดับประทับใจ Carto Other Used Cash 14% Car 1% New car 85% 91 K KASIKORNTHAI KF&E Highlights in 1H21 June 2021 (Bt.bn) 25.0 แฟคเตอรี แอนด์ อีควิปเมนท์ กสิกรไทย #KASIKORN FACTORY AND EQUIPMENT KF&E Outstanding Loans 25.11 22.88 20.38 20.0 17.63 14.80 15.0 10.0 5.0 00 25.26 Industry Outlook: ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Growth in Equipment Leasing (EQL) business forecasted using numerous factors including total import volume of machinery and equipment, direction of government policy, domestic and international business growth opportunities, and Capital Investment Index, including the labor cost factor that causes switching to use machines instead of human labor. KF&E Highlights: ■KF&E outstanding loans were Bt25.26bn, increasing 9.43% YoY 0.0 2016 2017 2018 2019 2020 1H21 KF&E currently ranked #1; maintaining lead position in equipment leasing industry Note: In 2010, KASIKORN FACTORING (KFactoring) was renamed KASIKORN FACTORY AND EQUIPMENT (KF&E) to better reflect their business, focusing on offering leasing services for machinery and equipment; the factoring business operation of KFactoring was transferred to KBank บริการทุกระดับประทับใจ 22 92#47K KASIKORNTHAI Life Insurance Industry in Thailand (%) 20.0 17.5 16.5 15.0 -17.9 10.0 6.15.8 5.0 6.6 Total Premium (Bt bn) Taiwan South Korea Premium per % GDP by Country 6.2 6.0 2.11.5 2.7 2.8 3.3 3.4 Singapore _ Australia ! India Malaysia_ Source: Swiss Reinsurance ■Y2017 Y2018 Y2019 2.32.3 3.6 3.6 3.3 1.51.4 1.3 China Thailand Size of Market by Premium(%) CAGR'11-20: 7% Indonesia Philippines 1.2 1.3 1.6 1.4 Vietnam New Business Premium ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK In 2019, low penetration rate of 3.3% in Thailand with a high opportunity for growth ■Muang Thai Life Assurance (MTL) ranked #4 in life insurance industry in Thailand, in 1H21 with 12.2% market share of total premium #4 in life insurance industry in Thailand, in 2020 Market Share by Total Premium in Life Insurance (%) Source: The Thai Life Assurance Association (%) (Bt bn) 2019 ■2020 ■1H21 700.0 600.0 627.4 500.0 601.7 568.3 537.5 610.9 400.0 503.9 442.5 300.0 391.4 328.6 200.0 100.0 30.0 200.0 600.2 1 24.3 180.0 25.0 24.2 I 160.0 20.0 23.1 140.0 13.4 120.0 294.9 15.0 100.0 15.1 13.7 10.0 12.7 80.0 9.6 60.0 5.0 14.9 15.13.7 12.82.2 9.1 8.5 5.86.1 5.25.2 4.1.3 6.56.4 2.4 2.0 5.8 5.3 4.0 2.4 2.4 1.4-4 6.9 40.0 0.0 20.0 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 1H21 AIA FWD TLI MTL KTAL BLA AZAY PLT OLIC SELIC Others New Business Premium Total Premium * New Business Premium in 1H21 Bt83.7bn Source: The Thai Life Assurance Association Note: SCB Life premium is combined with FWD Total Premium = New Business Premium + Renewal Premium; New Business Premium = First Year Premium + Single Premium บริการทุกระดับประทับใจ K KASIKORNTHAI Bancassurance Highlights in 1H21 Bancassurance Market Share by Total Premium (%) ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK (%) 40 2019 ■2020 ■1H21 30.1 30 28.8 20 18.4 19.9 26.1 10.0 10 22.6 11.3 9.0 8.5 7.8 11.7 9.0 8.4 8. 8.3 3.8.2 8. 0 4.2.9 3.5 1.9.8 2.4 1.1.5 1.7 2.2 3.5 1.3 FWD MTL KTAL PLT BLA AIA TLI AZAY SELIC GT Others Bancassurance Market Share by New Business Premium (%) (%) 40 2019 ■2020 ■1H21 30 25.6 30.3 17.6 20 16.3 25.6 10 16.6 18.6 9.9 8.1 6.3 8.1 9.1 9.5 9.4 8. 7.3 22.63.4 2.5 2.9 8.8 8.3 0 FWD MTL AIA PLT KTAL SELIC BLA GT TLI AZAY Others MTL ranked #2 in Bancassurance market #2 in Bancassurance total premium with 18.4% market share #2 in Bancassurance new business premium with 17.6% market share Source: Muang Thai Life Assurance (MTL), The Thai Life Assurance Association (TLAA) monthly report (new format) Note: SCB Life premium is combined with FWD Bancassurance premium include all bank partners' premiums of MTL บริการทุกระดับประทับใจ 93 94#48K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KBank's Strategic Acquisition in Muang Thai Group Holding (MTGH) MTL's insurance business supports KBank's strategic objective of providing a full range of financial services to satisfy customers' needs and universal banking platform MTGH FVC AIGEN MTI MTL MTB เมืองไทย mtl ปอเรช MTIB Current KBank Economic Interests Muang Thai Group Holding Co. Ltd (MTGH) 51.00% Muang Thai Life Assurance PCL (MTL) 38.25% Muang Thai Insurance PCL (MTI) 10.20% Muang Thai Broker Co, Ltd (MTB) 50.99% MT Insure Broker Co, Ltd (MTIB) Fuchsia Venture Capital Co, Ltd (FVC) AIGEN Co, Ltd (AIGEN) 38.20% 38.25% ■ Established on 6 April 1951 ☐ MUANG THAI LIFE First life insurance company to have received the Royal benevolence in granting the appointment as the life insurance company of His Majesty King Bhumibol Adulyadej ■ Joined hands with Ageas in 2004 (formerly known as Fortis Insurance International NV) and joined hands with KBank in 2009 ■Credit Rating: > S&P Global: BBB+ (Stable Outlook) Fitch Ratings: A- (Stable Outlook)/AAA(tha) (Stable Outlook) ■Life Insurance Company with Outstanding Management (1st Place Award) 2006 - 2019 (14 consecutive years) from Office of Insurance Commission (OIC) ■ Life Insurance Company of the Year 2014, 2017 and 2018 from Asia Insurance Industry Awards ■ Ageas holds 7.83% in MTGH and holds 24.99990% in MTL 51.00% บริการทุกระดับประทับใจ 95 k KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK Muang Thai Life Assurance (MTL) Information Summary mtl MUANG THAI LIFE เมืองไทย Strong fundamentals and revenue generation, helped by process efficiency and service quality enhancements; platform and synergy alignment between MTL and KBank Risk-Based Capital (RBC) remains strong, sufficient to support business growth and much higher than OIC minimum requirement Statements of Comprehensive Income (Bt bn) Strategy in 2021 To become the trusted brand that is ready to take care of and stand by customers during their every life stage under "MTL Trusted Lifetime Partner". This can be achieved through presentations of products and services via multi-channel distribution, with innovations and technologies that can address customer needs in every target group in a more personalized manner on digital and non-digital platforms responding to all needs of different lifestyles. The Company also progresses to develop its workforce for handling and adapting itself to the digital world completely and continuously emphasizes market expansion in countries with potential for economic growth. 2019 2020 1H21 Net premiums earned Net investment income Total revenues 80.5 72.2 20.4 21.4 100.9 93.6 34.0 11.5 45.5 Long-term technical reserve increase from the previous period 35.1 26.0 12.5 Net benefit payments and insurance claims 41.4 43.0 20.3 Commissions and brokerages 9.1 9.1 4.4 Other underwriting expenses 0.8 0.6 0.3 Operating expenses & Other 5.0 5.2 2.2 Key Financial Targets Total Expenses 91.4 83.9 39.7 Bt bn 2016 2017 2018 2019 2020 1H21 Profit before income tax expense 9.5 9.7 5.9 Total Premium Income tax expense 97.0 102.7 94.5 83.8 75.3 36.0 1.8 1.8 1.1 (after refund) Net profit (loss) 7.7 7.9 4.8 % Growth 10% 6% -8% -11% -10% 0% Statements of Financial Position (Bt bn) 2019 2020 1H21 2019 2020 1H21 Total Assets 531.1 556.4 579.4 ROE (%) 12.4% 11.3% 11.7% Total Liabilities Total Equities 464.5 483.4 498.2 ROA (%) 1.5% 1.4% 1.6% 66.6 73.0 81.2 Risk-Based Capital (RBC) 385.7% 323.3% 312.0% Source: Muang Thai Life Assurance, data based on book value except for RBC Note: OIC Office of Insurance Commission บริการทุกระดับประทับใจ 96#49k KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK MTL Investment Portfolio and Insurance Premium MTL Investment Portfolio: MTL Total Premium Fixed Income accounted for around 84% (bn) 120 Debestare 27.2% 102.7 94.5 100 83.8 75.3 Stack 11.3% 80 60 Neoba 3.%%% 40 31.1 Policy Loan 3.7% 20 Gov & S/E Unit Thrust Bond 3.5% 48.7% 200 71.6 Depart 6.476 2017 Mortgage Total MTL Industry Premium Growth 36.0 (% YOY) Y2017 6% 6% 22.8 26.0 21.6 23.6 Y2018 -8% 4% 12.4 Y2019 -11% -3% 71.7 57.9 53.8 Y2020 -10% -2% 1H21 0% 3% 2018 2019 2020 1H21 New Business Premium Renewal Year Premium ■Total Premium 100% actment Property Lon 0.4% 0.5% Assets Under Management (AUM)* (1H21): Bt 551,866 bn MTL Total Premium by Products: Ordinary product accounted for around 83% in 1H21 Source: The Thai Life Assurance Association MTL Total Premium by Channels: Bancassurance accounted for about 63% in 1H21 100% 80% 80% 60% 60% 40% 40% 20% 20% 0% 2017 2018 2019 2020 1H21 0% Group Personal Accident ■Industrial Ordinary 2017 ■ Other 2018 ■Direct Marketing 2019 2020 1H21 Bancassurance ■Agents *Remark: Invested Assets + Investment Property Source: The Thai Life Assurance Association (TLAA) / 2019 - 2Q2021 data from TLAA monthly report (new format) บริการทุกระดับประทับใจ K KASIKORNTHAI MTL International Business Expansion ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK MTL Current International Business Project (On-going) Cambodia Company Name Sovannaphum Life Assurance Dara Insurance Plc. Plc. Lao PDR ST-Muang Thai Insurance Co., Ltd. Vietnam MB Ageas Life Insurance Co., Ltd. Entry Strategy เมืองไทย Joint Venture with Canadia Investment Holding Plc. Joint Venture with Individual Shareholders Ownership by MTL 49% 25% Joint Venture with ST Group Co., Ltd and Muang Thai Insurance Company Limited (MTI) Joint Venture with Military Bank and Ageas 22.5% 10% Myanmar Operation Year 2015 2018 2016 2017 2014 Business Operation Life Insurance General Insurance Composite Insurance (Life & General) Life Insurance Representative Office บริการทุกระดับประทับใจ 97 98#50K KASIKORNTHAI MTL's Life Insurance Product Profile Four Major Types of Life Insurance Product ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK ■ Ordinary Life Insurance Products: Provide life protection for a fixed amount to an insured person Can be further classified into four sub-categories; ➤ Endowment Life Insurance: Savings type product; insured person receives an amount at the certain period of time or a designated beneficiary receives death benefits upon the death of the insured person within the insured period (e.g. Pro Saving products) Term Life Insurance: Provides temporary protection with no savings component. Claim can be made upon death within the stated term period (e.g. MRTA products) Whole Life Insurance: Provides life time protection (to the age of 90 or 99) with the death benefit paid to the beneficiary upon the death of the insured (e.g. Pro Life products) Rider: Additional coverage desired by the insured (sample of additional coverage: medical expense, accident) ■Group Life Insurance Products: Term insurance covering a group of people, usually employees of a company or members of a union or association ■Industrial Insurance Products: Life insurance with a modest amount of coverage, low premium, and no health check requirement ■Personal Accident: A limited life insurance designed to cover the insured in case of personal accident บริการทุกระดับประทับใจ K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Sample of K-Bancassurance and MTL Products K BANCASSURANCE K-Bancassurance Products¹ Endowment Life Insurance mtl Muang Thai Life Assurance Products² Endowment 615 Participating (Global) Pay premium for only 6 years, but the coverage continues for 15 years ความคุ้มครองชีวิตมิน 5% ของจำนวนเงินเอาประกันภัย ณ วันเริ่มเมืองคุ้มครองตามกรมธรรณ์ หรือมูลค่าเพิ่มขึ้นในระยะนั้น ตามแต่จำนวนใดจะมากกว่า Life coverage is in % of the initial sum insured, or cash surender value at the time, whichever amount is higher 600% ชำระเบี้ยประกันภัย 550% 440% 300% Premium payment at the 220% beginning of policy year 110% De I End of policy year 0 1 2 3 4 5 7 8 9 10 11 12 13 14 15 นาย Cash bonus - - - - - รับเงินจ่ายค้น 5%. ณ ในปีกรมธรรม์ ทุกๆ 2 ปีกรมธรรม์ ยกเว้นในปีกรมธรรม์ที่ครบกำหนดสัญญา - - - - - Receive cash bonus at 5% at the end of policy year for every two polley years. Except at the end of polley maturity Maturity 600% Ad Matty d Term Life Insurance MRTA-Home (Mortgage Reducing Term Assurance) Example, in case the customers choose to insure their loan in full term and full coverage Loan Amount Sum insured amount Premium payment at the beginning of policy year The contract starts Coverage of Pitaksin-Home is equivalent to the reducing sum Insured amount Policy Year " a " 4 " Coverage Loan Amount Scenario 1: Death or total and permanent disability The customers can choose to continue the coverage throughout the contract term or receive cash surrender value MUANG THAI 101 Plus Campaign Single Premium payment period, but the coverage continues for 10 years Life Coverage 110% Or cash surrender value at that time (whichever is higher) End of Policy Year 00034567891 Premium Payment at the Beginning of Policy Year Cash Bonus(1) Remark Maturity Maturity 1% 1% 1% 1% Benefit +Dividend 101%0 (if any) (1) Benefit and coverage are in % of the initial sum insured. In Case the benefit amount and coverage are stated incorrectly, the specified % shall apply. (2) The dividend shall be paid in case the insured is alive upon the contract maturity only. However, the company does not quarantee maturity dividend. (The amount shown in the schedule below is calculated based on "Maturity Dividend Formula" only. Term Life Insurance 99 Khumkhrong Baep Khongthi Life-Bukkhon Single Premium payment period, but the coverage can be chosen between 1 - 15 years Term of installment loan End of Policy Year 10 11 12 13 14 15 Term of insurance Premium Payment Scenariola Early Redemption at the Beginning of Policy Year Remark (1) Is in % of the initial sum insured Remark: the above coverage is based on an assumption that the customer's credit repayment history is normall according to the Bank's loan contract 1) K-Bancassurance products are MTL's life insurance products selling through KBank 2) Muang Thai Life Assurance products are MTL's life insurance products selling through MTL sales agents, and/or other channels บริการทุกระดับประทับใจ Coverage Period Premium Payment Period 1-15 Years Single Premium 100% (1) Life Coverage Maturity 100#51K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Sample of K-Bancassurance and MTL Products K BANCASSURANCE ASCENTHI MEL WALT Muang Thai Life Assurance Products² K-Bancassurance Products1 Whole Life Insurance Khumkhrong Talot Chip 99/5 Life insurance with a premium payment of only 5 years, but the coverage continues to age 99 years ตัวอย่าง Example ชำระเบี้ยประกัน นปีกรมธรรม์ Premium payment at the beginning of policy year Muang Thai Smart Protection 99/20 Whole life coverage: pay premium for 20 years and get coverage to the age of 99 ความคุ้มครองชีวิต 100% ของจำนวนเงินเอาประกันภัย หรือมูลค่าเวนคืน หรือจํานวนเบี้ยประกันภัยที่ได้ชำระไว้แล้ว (ตามแต่จํานวนโคจะมากกว่า) Life coverage at 100% of sum insured or surrender value or paid premium (whichever is higher) หยุดชำระเบี้ยประกัน Stop premium payment End of Policy Year 03 Premium Payment at the Beginning of Policy Year สิ้นปีกรมธรรม์ 0 1 2 8 End of policy r 6 Elite Health Rider อายุ 97 ปี อายุ 98 ปี ครบอายุ 99 ปี Age of 97 Age al 98 Life Coverage 100% Attaining the Age of Years Maturity Benefit 100% Attaining the age of 99 When Maturity Benef 100% Remark (1) Is in % of the initial sum insured. (2) In case of being alive until contract maturity, the benefit is 100% of the initial sum insured. (3) Life coverage is 100% of the initial sum insured or cash surrender value at that time or paid premium (whichever is higher). Rider D Health Rider B Ja High coverage from 20-100 million Cover critical Illnesses Baht/year including cancer treatment by Targeted therapy Ja Cover overseas treatment based on coverage areal Get it easily and be covered to the maxd Get coverage for standard private room, ICU room femination fee, medicine cost, operation fee during hospitalization and IPO expenses in a lump sum payment of up to 5 Ma per time, with no limit of times per year. 1) K-Bancassurance products are MTL's life insurance products selling through KBank Get it easily and be taken care of extensively until 99 years old. Get it easily and choose what suits you with the lump sum payment option since the first Baht or a deductible option for more affordable premium. 2) Muang Thai Life Assurance products are MTL's life insurance products selling through MTL sales agents, and/or other channels บริการทุกระดับประทับใจ OPD Rider Receive OPD Coverage Up to 30 times per year Complete Coverage dadog dacia's fees charges, medical expenses The Right Rider This OPD rider is not required to be purchased together with IPD coverage K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Key Transaction Summary and BA Business Going Forward KBank and Muang Thai Life Insurance (MTL), a subsidiary which KBank effectively holds 38.25% shares, have entered into a 10-year exclusivity bancassurance agreement. KBank will receive payment of Bt 12.7 bn and annual performance bonus, in return for distributing MTL's life insurance products, health and critical illness insurance products. In comparison to similar exclusivity bancassurance arrangement, Jay Capital (KBank's IFA) provided an opinion that terms, conditions as well as the basis of exclusivity fee determination are appropriate. KBank considered the overall economic value - both BA agreement value and equity value. ■ Aligning strategic direction with MTL through Bancassurance Agreement, KBank expects to enlarge BA markets in all key insurance products; life, health, and critical illness. In addition, KBank's Share of Wallet (SOW) in BA is still relatively low; thus, KBank could penetrate the market in a liquidity-flush environment. ■ Amortization of BA agreement value (Bt 12.7 bn.) and performance bonus will be recorded in non-interest income in Bank only financial statement and in non-controlling interest in consolidated financial statement Note: BA = Bancassurance, IFA = Independent Financial Advisor บริการทุกระดับประทับใจ 101 102#52K KASIKORNTHAI Total Economic Value ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK ■ KBank still effectively owns 38.25% of MTL's equity. Bilateral negotiation is a balancing act Sales Channel Value 1 Company Value* Commission Non-contingent Performance Bonus Bancassurance Exclusivity Value KBank's Share in MTL Equity (38.25%) ■ Potential destruction to our economic value caused by MTL having to find other sales channel replacement is high. Better value accretion can be achieved through this business alignment We considered the overall economic value to KBank from both sales channel value and company value i.e. if sales channel value increases, company value will decline. *Non-listed company บริการทุกระดับประทับใจ K KASIKORNTHAI Impacts on Income Statement ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Bancassurance Agreement has impacts on following components in the income statement: KBank (Bank only): Non-interest income: + Bt 1,270 mn (average payment per year) + performance bonus MTL: Non-interest expense: + annual payment Consolidated KBank: Non-controlling interest: 61.75% x annual payment after tax Consolidated net profit: 61.75% x annual payment after tax 103 If NPE improves from this arrangement, KBank's consolidated income and MTL's NPE will rise. Note: Annual payment = Bt 1,270 mn (average payment per year) + performance bonus; NPE = Net Premium Earned บริการทุกระดับประทับใจ 104#53Note: K KASIKORNTHAI KBank: Other Information บริการทุกระดับประทับใจ ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK K KASIKORNTHAI Shareholder Structure July 16, 2021 (Record Date) Shareholder Structure Top 10 Shareholders* 1. THAI NVDR CO., LTD** ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK % 20.002 2. STATE STREET EUROPE LIMITED 7.261 3. SOUTH EAST ASIA UK (TYPE C) NOMINEES LIMITED 4.633 Thai Shareholders 62.9% 4. SOCIAL SECURITY OFFICE 3.981 Foreign Shareholders 37.1% 5. THE BANK OF NEW YORK MELLON 3.215 (NVDR 6. EAST FOURTEEN LIMITED-JOHN HANCOCK FUNDS 1.300 = 20.002%**) 7. HSBC BANK PLC-PRUDENTIAL ASSURANCE COMPANY LIMITED 1.158 8. SE ASIA (TYPE B) NOMINEES LLC 1.121 9. HSBC BANK PLC - SAUDI CENTRAL BANK SECURITIES ACCOUNT A 0.997 Note: Foreign Shareholding Limit 49% The Top 10 Shareholders are based on individual accounts 10. BNY MELLON NOMINEES LIMITED Other Shareholders Total 0.863 55.469 100.000 ** Thai NVDR Co., Ltd (Thai NVDR) is responsible for issuing and selling Non-Voting Depository Receipts (NVDRS) to investors. The Stock Exchange of Thailand (SET) is the major shareholder, holding 99.99% of the total shares, of Thai NVDR. The NVDR limit for KBank is 25%. *** Thailand Securities Depository Company Limited (TSD), a subsidiary of the Stock Exchange of Thailand, provides three types of securities post trade services: securities depository services, securities registration services, and provident fund registration services; the shareholders booked under TSD are those who are not eligible for dividend payments as their investment is not aligned with their citizenship (i.e. foreign investors buying KBank shares on the local board or Thai investors buying KBank shares on the foreign board) Source: Thailand Securities Depository Company Limited (TSD), the Stock Exchange of Thailand website (www.set.or.th), and KBank บริการทุกระดับประทับใจ 105 106#54k KASIKORNTHAI Credit Ratings As of August 6, 2021 Long-term * KBank Local Currency/ National Outlook Long-term Subordinated Foreign Currency Senior Unsecured Subordinated Debts Notes Debts ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Thailand Government Outlook Foreign Local Currency Currency S&P's BBB+ Watch BBB+ N/A N/A N/A BBB+ A- Negative¹) Stable 2) Moody's Baa1 Baa1 Baa3 Baa1 N/A Stable ³) Baa1 Baa1 Stable 4) Fitch BBB5) BBB5) BB+5) AA+ (tha) AA-(tha)5) Stable BBB+ BBB+ Stable 6) Note: * Moody's: Foreign Currency Long-term Deposit Rating; S&P's: Long-term Counterparty Credit Rating; Fitch Ratings: Foreign Currency Long-term Issuer Default Rating 1) August 24, 2020: S&P's changed the outlook on the long-term ratings of two Thai banks, including KBank, to watch negative from stable, following the change in the outlook for the banking industry outlook to negative from stable on August 21, 2020 2) April 13, 2020: S&P's downgraded its outlook on Thailand's sovereign credit rating to 'Stable' from 'Positive'; reflecting its view that the COVID-19-induced economic uncertainty and the state of emergency declaration could delay political transitions expected under the civilian government over the next 12 months 3) April 22, 2020: Moody's changed the outlook on the long-term ratings of ten Thai banks, including KBank, to stable from positive, following the change in the outlook for the sovereign's rating to stable from positive on April 21, 2020 4) April 21, 2020: Moody's changed the outlook on the Government of Thailand's issuer ratings to stable from positive, as the drivers of the outlook change to positive July 2019 have become significantly less likely to materialize, such as delays in policy implementation, ongoing political tensions, and the deep economic shock caused by the COVID-19 outbreak 5) April 2-8, 2020: Fitch downgraded KBank's ratings, including SCB, BBL and BAY, due to the challenging operating environment and the large-scale economic disturbance caused by the COVID-19 pandemic 6) March 17, 2020: Fitch downgraded the outlook of Thailand to stable from positive, reflecting the evolving impact of the global COVID-19 outbreak on Thailand's economy through its tourism sector as well as lingering uncertainty in Thailand's political environment following the country's transition to civilian rule บริการทุกระดับประทับใจ K KASIKORNTHAI Organization Chart Auditor Shareholders Corporate Secretary Operating Committee Corporate Secretariat Division ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK Board of Directors Management Committee Independent Directors Committee Risk Oversight Committee Audit Committee Advisory Council to the Board of Directors/ Legal Adviser Corporate Governance Committee Human Resources and Remuneration Committee Sales & Service Product Management Private Bank Business Service Fulfillment Business in Overseas Distribution Network Division Transaction and Wealth Banking Division Private Banking Group Customer and Enterprise Service Fulfillment Division World Business Group Corporate Business Division Credit Products Division Channel & Marketing Management Integrated Channels and Business Solutions Division Marketing Management Division Money & Capital Markets Business Capital Markets Business Division Investment Banking Business Division บริการทุกระดับประทับใจ Audit Division Corporate Strategy & Analytics Corporate Strategy and Innovation Division Risk & Resources Management Enterprise Risk Mgmt. Division Data and Analytics Division Finance and Control Division Human Resource Division Note: Effective on 1 August 2021 107 108#55K KASIKORNTHAI Board of Directors Structure ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK ■18 board members: 9 Independent Directors, 5 Executive Directors, and 4 Non-Executive Directors ■Director age limit is 72 years old ■Term limit of directorship for Independent directors shall not exceed nine consecutive years Lead Independent Director and Independent Directors Committee were appointed in order to ensure proper checks and balances Executive Directors (5) ⚫ Ms. Kattiya Indaravijaya (Chief Executive Officer) ⚫Mr. Pipit Aneaknithi (President) • Mr. Patchara Samalapa (President) ⚫Mr. Krit Jitjang (President) ⚫ Dr. Pipatpong Poshyanonda (President) Non-Executive Directors (4) ⚫Ms. Sujitpan Lamsam (Vice Chairperson) • Mr. Sara Lamsam ⚫ Ms. Chonchanum Soonthornsaratoon (Legal Adviser) • Mr. Suroj Lamsam Independent Directors (9) ⚫ Ms. Kobkarn Wattanavrangkul (Chairperson of the Board and Lead Independent Director) • Sqn.Ldr. Nalinee Paiboon, M.D. (Chairperson of the Corporate Governance Committee) • Mr. Saravoot Yoovidhya ⚫Dr. Piyasvasti Amranand (Chairman of the Risk Oversight Committee) .Mr. Kalin Sarasin (Chairman of the Audit Committee) • Mr. Wiboon Khusakul ⚫ Ms. Suphajee Suthumpun (Chairperson of the Human Resources and Remuneration Committee) • Mr. Chanin Donavanik ⚫ Ms. Jainnisa Kuvinichkul Chakrabandhu Na Ayudhya Note: More information on the Board of Directors biographies can be found on our website https://www.kasikornbank.com/EN/about/Pages/board-of-directors.aspx บริการทุกระดับประทับใจ 109 K KASIKORNTHAI Sustainable Development KASIKORNBANK conducts business with the principles of a Bank of Sustainability, supported by good corporate governance principles, as well as appropriate risk and cost management. We strive to balance economic, social, and environmental dimensions to achieve goals and create sustainable long-term returns. The philosophy of sustainable development is instilled in all our operations as part of our Green DNA, ensuring maximum benefit for all stakeholders and paving the way for sustainable growth. SD Framework 1 GOAL COMMITMENT SD Policy 8 1013 (=) ECONOMY Being an accountable bank to create sustainable profitability We are committed to strong ESG principles to be a responsible and accountable bank 1. Business operations defined by good corporate governance practices 2. Adherence to Customer Centricity by initiating financial innovations to meet every aspect of customers' needs 3. Efficient risk management focusing on environmental, social, and governance (ESG) issues 4. Market Conduct and Customer data security and privacy Be a Bank of Sustainability SOCIETY Being a responsible corporate citizen to create a sustainable society We are committed to developing strong relationships with employees and society to better livelihoods and increase prosperity STAKEHOLDER ENGAGEMENT 5. Financial inclusion and financial literacy 6. Fairness of labor relations management and development of employee skills, knowledge and welfare 7. Respect for human rights and diversity 8. Development of youth potential as well as pursuit of environmental, public, and social activities Commitment-based Sustainable Finance Initiatives (ENVIRONMENT Ensuring environmental stewardship towards a zero-carbon society We are committed to preserving and reducing the impact of climate change 9. Financial support to environmentally- friendly businesses 10. Environmentally friendly and reducing the environmental impacts of our own operations Participating in commitment-based sustainable finance initiatives which are UN Principles for Responsible Banking, TCFD and memorandum of agreement on establishing responsible lending practices. UNER PUSSY FINANCE NITIATIVE BARING TCFD www.bu BUCK OF TELADAMSO INTERNATIONAL Dow Jones Sustainability Indices Powered by the SSP CSA Sustainability Award Silver Class 2021 S&P Global FTSE4Good MSCI Bloomberg #CDP NIGHT ACTION NATIONAL THS THAILAND STMENT 2020 ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK PRIDE OF KBank The first and only commercial bank in Thailand and ASEAN selected as a member of the DJSI World Index and DJSI Emerging Markets Index for five consecutive years (2016-present) KBank has been classified in the Silver Class of the banking industry from S&P Global Sustainability Awards (2021) (Bronze Class 2018-2020) A member of the FSTE4Good Emerging Index for the fifth consecutive years (2016-present) KBank's Leadership Level rating is at AA for its ESG performance among emerging market banking sector peers The first Bloomberg Gender-Equality Index (GEI) member from Thailand. The Bloomberg Gender-Equality Index (GEI) distinguishes companies committed to transparency in gender reporting and advancing women's equality for two consecutive years (2019-present) The first Thai commercial bank with B Management Level rating, assessed by the Carbon Disclosure Program (CDP) Included in Thailand Sustainability Investment (THSI) for five years (2015, 2017- present) ESG100 ESG 100 certificate 2021 SET SET Sustainability Awards - Outstanding granted by the Stock Exchange of Thailand for two consecutive years (2018-2019) Sustainability Report Award 2020 Sustainability Disclosure Award (Certified by Thaipat) The first and only carbon neutral commercial bank in Thailand. granted Carbon Neutral granted by Thaipat Institute Certification (2018-2021) บริการทุกระดับประทับใจ Note: More information on our Sustainable Development can be found on our website and KBank's Sustainability Report 2020 110#56K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Example of Economic Aspect: ESG Risk Management ■KBank has integrated ESG considerations into the risk management framework, with particular attention given to risks related to lending, investment, products, and services At the management level Lending activities are structured so as to demonstrate environmental and social responsibility as follows Board of Directors Risk Oversight Corporate Governance Committee Committee Sustainable Development Sub-committee Credit Risk Management Sub-committee Business Units Monitoring and Controlling Function Board of Directors Approving risk management policy, frameworks, risk limits and risk appetites Risk Oversight Committee Overseeing and ensuring compliance with consolidated risk management policies and strategies and acceptable risk appetite Assessing risk management policies and strategies to cover all risks including emerging risks Corporate Governance Committee Overseeing, monitoring, and undertaking sustainable development ■ Determining and approving credit policy addressing environmental and social impact management in lending and investment activities Ensuring effective practice of ESG risk management and sustainable development operations Business units Screening environmental and social risks of projects to be supported Ensuring and monitoring projects' compliance with regulations/ environmental and social management plans ■Monitoring and Controlling Functions Ensuring credit policy and procedure compliance Reporting project finances and concerning environmental and social issues to the Corporate Governance Committee • At the transaction level The Bank ensures that lending transactions violate neither the law nor social ethics, for example Offences relating to narcotics Offences relating to gambling Offences relating to exploitation of natural resources Offences relating to embezzlement Offences relating to terrorism Offences relating to human trafficking Environmental and Social Assessment Check if requests do not fall under Exclusion list, and conduct preliminary Environment, Social and Governance screening check Secure endorsement by Heads of Business and Enterprise Risk Management (Only for Project Finance requests) Conduct detailed specific industry, ESG aspects and credit analysis for request approval Approve/reject requests within delegated lending authority along with designating environmental and social impact conditions บริการทุกระดับประทับใจ K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Examples of Economic Aspect: CG and Anti-Corruption Corporate Governance ■ Reviewing KBank practices under Thai IOD, ASEAN CG Scorecard, and Dow Jones Sustainability Indices (DJSI) criteria, including the Sustainable Development Policy in accordance with the Bank's business and Sustainable Development Goals Implementing a strategic plan for CG activities to enhance compliance by directors, executives, and staff with CG principles, Code of Conduct, and Anti-Corruption Policy through ➤ Organizing training courses and continually communicating via e-Learning system Communicating with companies within KASIKORNBANK FINANCIAL CONGLOMERATE to ensure consistency of operations ■ Reviewing the Statement of Business Conduct, the Code of Conduct, the Statement of CG Principles, CG Policy, and related Charters; keeping them up-to-date in accordance with ➤ Ongoing business operations and Bank Sustainability Compliance with laws, international practices, and best practices as prescribed by regulatory agencies and competent agencies Note: Thai IOD = Thai Institute of Directors; CG = Corporate Governance Anti-Corruption • KBank, KAsset, and KSecurities co-signed a declaration of the "Private Sector Collective Action Coalition Against Corruption (CAC)" project and have been recognized as CAC certified companies since 2013 • BOD approval and annual reviews of Anti-Corruption Policy, including issues such as bribes and inducements, gifts and benefits, charitable contributions and sponsorships, and political participation • Internal Communication on Anti-Corruption Policy to ensure proper practices within the organization by Organizing training courses for executives and employees Communicating with all directors, executives and employees via KBank electronic networks and website • Communicating with suppliers on operational guidelines, including Guidelines for acknowledgement and compliance related to business ethics, human rights, labor, occupational health and safety, and the environment corruption policy and practices Communication on business operations in compliance with anti- Arrangement of supplier meetings on KBank's procurement procedures Communication with customers and suppliers on No Gift Policy for all occasions and festive seasons Provision of various channels to receive information, complaints and whistle-blowing บริการทุกระดับประทับใจ 111 112#57K KASIKORNTHAI Examples of Social and Environmental Aspects Social Aspect 1. Financial Inclusion and Financial Literacy • Providing financial knowledge and adding new channels of financial access for all customer categories and underprivileged groups Supporting customers' financial discipline to alleviate household debts 2. Human Resource Management • • Embracing equitable treatment for employees regardless of differences Providing various channels for complaints and suggestions Developing employee skills and abilities in alignment with K-Strategy Providing a healthy and safe workplace 3. Human Rights Operations . Operating business in line with the United Nations Guiding Principles on Business and Human Rights throughout the value chain Implementing human rights risk assessment covering all operations of KBank, K Companies, P Companies, suppliers, and joint ventures 4. Social Contributions Applying the social activity framework based on the London Benchmarking Group (LBG)* since 2015 Supporting various projects by extending budgetary support and donating items to create positive impact for society and communities GREEN DNA 349,108 Volunteer Hours ZERO Human Rights Policy and Due Diligence Human Rights Process injury ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Environmental Aspect 1. Management of Climate-related Risks and Opportunities . . Assessing climate scenario analysis quantitatively and qualitatively Reporting based on the Task Force on Climate-related Financial Disclosures (TCFD) recommendations 2. Financial Support To Environmentally Friendly Businesses . . • Offering financial support to renewable energy power and environmental conservation projects Issuing sustainability bonds and investing in green bonds Introducing K Climate Transition, Thailand's first and only fund under the climate transition theme, which invests in LO Funds - Climate Transition, (USD), I Class A • Introducing K-CHANGE, Thailand's first Impact Investing fund with the investment policy through the Master Fund Baillie Gifford Positive Change Fund - Class B accumulation (GBP). 3. Environmental Management in KBank . Appointing CEO to act as Chief Environmental Officer to drive KBank's environmental operations • Committing to transform to a low carbon society • Targeting to reduce GHG emissions by 6.1% by 2023 (base year 2018) TCFD TASK FORCE CLIMATE RELATED FINANCIAL DISCLOSURES The first Thai commercial bank to become a TCFD Supporter. carbon nestral GHG Emissions (Scope 1 & 2) 97,785.73 tons CO2 (21.34% decrease from base year 2012) The first Thai and ASEAN bank to launch a Sustainability Bond BUILDING CO COUN GREEN BU KBTG-LEED-Platinum Note: * London Benchmarking Group (LBG) standard is used to evaluate the monetary value of corporate spending on social responsibility activities, including donations, hours of volunteer work an proportion of community investment. บริการทุกระดับประทับใจ 113 K KASIKORNTHAI Public Recognition Highlight: 2020-1H21 ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK 1H21 Sustainability Award Silver Clan 2001 - Sustainability Award, Silver Class of the banking industry S&P Global Blankey A member of the 2021 Bloomberg Gender-Equality Index -B score from 2020 Carbon Disclosure CDP Project (CDP) Thaipat Institute- Sustainability Disclosure Award 2020 ASIAMONEY - Best for ESG in Thailand - The Asset ESG Corporate Awards 2020 Best for HNW in Thailand THE Asset Platinum Award: Excellence in Environmental, Social and Governance ThaiBMA MORNINGSTAR a THE Best Service Provider-Cash Management - Best Service Provider-E-Solutions Partner msijusunans Bank of the Year 2021 - Digital Private Bank of the Year in Thailand Most Prominent Fund House in Corporate Bond Market - Best Bond House - Top Underwriting Bank - Best THOR Engagement THE ASIAN BANKER Best Fund House - Domestic Equity - Best Retirement Mutual Fund - Equity - Best Thailand Equity Large-Cap Fund - Best Thailand Mid/Long-Term Bond Fund Best Retail Bank in Thailand - Best Merchant Service (Facebook Pay) - Best Digital/Mobile Banking Service - Top Mobile Banking in Asia Pacific (KBTG) Best Private Bank Best Sustainable Bank FinanceAsia Best FX Bank for Structured Product: Commodities Credit Equity FX and Multi-Assets - Best Corporate Treasury Sales and Structuring Team - Best FX Bank for Retail Clients - Best Bond House in Thailand - Winner: Best Digital Bank for CX - Thailand (LINE BK) - Best Private Bank for Digital Marketing & Communication - Asia Winner: Best Fintech for Digital CX-Alternative Wealth Management (FinVest) - Highly Acclaimed: Best CX Business Model, - Highly Acclaimed: Best Digital CX Partner/Vendor (LINE BK) Asia Bankers Club Winner: Outstanding Innovation in Digital CX - Investment Product/Service Winner: Outstanding Innovation in Digital CX - Platform/Website - The Best Office Architecture Thailand 2021-2022 (KBTG) Dow Jones Sustainability Indices 2020 - An index component of the Dow Jones Sustainability Indices (DJSI) 2020, including the DJSI World Index and the DJSI Emerging Markets Index GROUP - Gold Award: Best Advance in Brandon Hall Competencies and Skill Development - Silver Award: Best Advance in Leadership Development HR Asia Best Companies to Work for in Asia - Most Caring Companies ASIAMONEY Thailand - Best for ESG FinanceAsia - Best DCM House in Thailand Best Private Bank in Thailand Innovation Leader of The Year TSSP-Triple A Best Private Bank in Thailand Sustainab SAM - The Bronze Class of the banking Be Class 2020 industry category by RobecoSAM - The Most Popular Stock Award THE ASIAN BANKER - Best Home Loan Product in Thailand 2020 - Best Staff Training and Development Programme RETAIL BANKER IFRASIA 2010 Triple A Best Private Bank-HNWIS in Thailand Best Service Provider: Transaction Bank - Best Service Provider: Cash Management - Best Service Provider: E-Solutions Partner - Best Wealth Management Bank in Thailand Best FX Bank for Structured Products Thailand Bond House of The Year - Thailand Capital Markets Deal of the Year - Best Retail Bank in Thailand - Best Home Loan Product TAB Pum - Best Private Bank for Portfolio Management Technology - Asia Best Corporate Treasury Sales and Structuring Team IDC-1 of 20 Asia/Pacific Best - Best FX Bank for Retail Clients - Best ESG Green Financing in Southeast Asia: Thailand Best Local Currency Bond Deal of the Year, Thailand - Best Bond Deal for Retail Investors in Southeast Asia APP ANNIE PRIVATE BANKER - Highly Commended Achievement- Most Effective Winner- Most Innovative Digital Offering Winner: Loan Offering of the Year Winner: Best Customer Experience - Debit Card Winner: Best Private Bank- Digitally Empowering RMs Winner: Outstanding Customer Experience for Loans Bank for 2020 -K PLUS as #1 Top 10 of Finance Apps by MAU in Thailand iOS & Google Play Investment Service Offering O Granted Carbon Neutral Certification - Top Outright Primary Dealer BANE OF THMLAND - Winner: Best Digital Customer Experience in Wealth Management - Highly Acclaimed: Best Digital Customer Experience in Private Banking - Highly Acclaimed: Best Digital Customer Experience - Loan Application MORNINGSTAR Best Fund House - Domestic Equity - Best Retirement Mutual Fund - Equity - Best Long-Term Equity Fund BrandAge-2020 Thailand's Most Admired Brand for K-Credit Card products and K PLUS - Top Underwriting Bank Deal of the Year ThaiBMA Best Outright Primary - Product Innovation Awards for lifestyle financial Business products in the categories of credit card and debit card WWISESIGHT - Best Brand Performance on Social Media in Banking Category Dealer Note: CX Customer Experience บริการทุกระดับประทับใจ 114#58K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Banking System and Regulations Update บริการทุกระดับประทับใจ K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Thai Commercial Banks and Specialized Financial Institutions (SFIs) Market Share (% of Total Loans) Market Share (% of Total Deposits) 115 6 SFIs I Bt Billion Bt Billion 24,000 souilu 20,000 16,680 17,004 17,765 18,869 19,358 20,301 20,666 24,000 20,936 21,291 20,000 16,296 16,843 17,707 18,463 19,178 16,000 EXIM 29.9% 29.9% 16,000 30.0% 30.4% 30.2% 30.2% 27.0% 26.8% 26.5% 25.9% 26.7% 26.8% 29.9% 26.2% 12,000 12,000 8,000 8,000 14 Commercial Banks* | 4,000 4,000 70.1% 70.1% 70.1% 70.0% 69.6% 69.8% 69.8% Bangkok Bank 0 0 sumans-aine ธนกรไทย 2015 2016 2017 2018 2019 2020 May-21 ■SFIs Commercial Banks. 73.8% 73.3% 73.2% 73.0% 73.2% 73.5% 74.1% | I 2015 2016 2017 2018 2019 2020 May-21 ! ■SFIs ■Commercial Banks Net Loans Deposits Inow SCB Bt Billion 14,000 ธนาคารธนชาต 12,000 10,470 10,602 11,061 11,633 11,859 12,579 12,765 Bt Billion 16,000 I 14,472 14,802 10,000 TMB CIMB O 22.1% 22.7% 22.8% 22.9% 22.8% 8,000 13.6% 12.8% 11.3% 12.3% 12.5% 12.9% KIATNAKIN BANK 6,000 14.6% 15.0% 15.0% 15.4% 17.1% 15.1% 16.4% 15.8% 15.7% 15.8% Other 14,000 21.9% 21.5% ■BAY 12,000 12.5% KBank 10.000. ■KTB 16.4% 16.9% 17.5% ■BBL 11,196 11,359 12,099 12,578 13,057 20.2% 21.5% 21.5% 20.6% 20.6% 21.2% 12.7% 12.6% ■ Other 19.5% BAY ■KBank 11.3% 11.9% 9.4% 8,000 9.7% 10.9% 16.7% 15.3% 15.8% 15.5% 15.8% 15.8% 16.2% ■ KTB I 6,000 18.1% 17.4% 17.1% 16.2% 16.5% 17.0% 17.1% BBL LH BANK ICBC 4,000 19.1% ■SCB Standard Chartered S 16.4% 16.8% 16.4% 16.1% 15.5% 15.1% 14.7% 4,000 2,000 18.2% 18.6% 18.6% 18.0% 17.7% 17.2% 17.7% ■SCB I 2,000 16.8% 17.5% 17.5% 17.4% 16.8% 16.9% 16.8% 16.8% 17.8% 17.3% 17.1% 16.5% 16.8% 16.3% 0 *The integration of TMB Bank and Thanachartbank was completed in Jul-21. 0 I 2015 2016 2017 2018 2019 2020 May-21 2015 2016 2017 2018 2019 2020 May-21 Note: 6 SFIs include Government Saving Bank (GSB), Government Housing Bank (GHB), Export-Import Bank of Thailand (EXIM Bank), Bank for Agriculture and Agricultural Co-operatives (BAAC), Small and Medium Enterprise Development Bank of Thailand (SME Bank), and Islamic Bank of Thailand (IBank) บริการทุกระดับประทับใจ 116#59K KASIKORNTHAI Thailand's Digital Readiness: Number of Users ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK ■ High adoption of digital lifestyle in Thai market; high penetration in smart devices and internet users in preparation toward a cashless society (Mobile Banking & e-Money) 149.1% Penetration Mobile Internet 1) (Mobile internet numbers) 54.3% Penetration Broadband Internet 1) (No. of households using internet via broadband) 81.7% Penetration Social Media 2) (No. of Facebook users) Prompt Pay พร้อมเพย์ 57.1 116.3% Million PromptPay 4) Penetration 56.7% Penetration (Total registration) Mobile Banking 4) (No. of accounts) Internet Banking 4) (No. of accounts) 5.9 billion transactions (+60.0%, YoY) Bt150.1trn (-2.6%, YoY) Thailand e-Payment ³) (Volume and Value) 185.9% Penetration e-Money 4) (No. of accounts/ cards) Source: The Bank of Thailand (BOT), National Statistical Office of Thailand (NSO), Thai Banker Association (TBA), Ministry of Interior (MOI), wearesocial and KResearch Notes: Denominator for all penetration ratio is number of population age six and above as of December 2020. Denominator for fixed internet penetration is number of household. 1) As of Mar-21, 2) As of Jan-21, 3) Jan-Apr 21, 4) As of Apr-21 บริการทุกระดับประทับใจ K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Financial Sector Master Plan (FSMP) Implementation Stages FSMP I (Y2004-2009) ■ Increase efficiency of the financial institutions system - 'One Presence' policy - Expand scope of business: 'Universal Banking' - New licenses for retail banks and foreign bank subsidiaries ■ Promote financial inclusion - Strengthen financial institutions (FIs) by promoting voluntary mergers ■ Protect customers Source: BOT and KResearch FSMP II (Y2010-2014) Looking forward to liberalization Reducing system-wide operating costs " ■ Streamlining regulations ■Tackling remaining NPLs and NPAs Promoting competition and access to financial services ■ Promote competition ■ Promote financial access ☐ Strengthening financial infrastructure ■ Promote development of financial products that help support risk management ■ Enhance information systems for risk management ■ Push for draft/review of necessary financial laws to support risk management and an expedited resolution to NPLs ■ Promote information technology utilization ■ Develop human resources in the financial sector FSMP III (Y2016-2020) competitive, inclusive, connected, and sustainable 1) Promote electronic financial and payment services, as well as enhance efficiency of the financial system ▪ Promote the adoption of digital banking & electronic payment services in the government, business, and retail sectors ▪ Enhance operational efficiency of financial institutions and other service providers ■ Evaluate future financial landscape to promote operational efficiency of financial institutions and other service providers 2) Support regional trade and investment linkages ■ Facilitating and reducing obstacles for banks' international expansion, including ■ The establishment of Qualified ASEAN Bank (QAB) ■ The development of cross-border financial infrastructures ■ The creation of suitable financial environments among neighboring countries to foster international trade and investment in the GMS 3) Promote financial access ■ For households: encouraging development of financial products and services appropriate for changing customer demands ▪ For SMEs: improving necessary SME database within the financial institution system and supporting credit extension to SMEs ▪ For Corporate: promoting and facilitating suitable environment for private sector's raising of capital 4) Develop relevant infrastructure (Enablers) ■ Developing key infrastructures in the financial system ■ Strengthening regulations and supervision in line with international standards to ensure stability of the overall financial system Note: There are four types of Commercial banks in Thailand; Full service banks; Foreign bank branches; Retail banks; and Subsidiaries GMS = Greater Mekong Subregion = Cambodia, China, Lao PDR, Myanmar, Thailand, and Vietnam บริการทุกระดับประทับใจ 117 118#60K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Updates on the Deposit Protection Agency (DPA) DPA Objectives and Missions Enhanced understanding of the deposit protection scheme ■Close cooperation with related authorities to maintain stability of the financial institution system Establishment of an appropriate system for premium collection and sound management of the Deposit Protection Fund ■Development of an effective information system to ensure fairness of the deposit protection scheme, with accurate and rapid reimbursement ■Management according to Good Governance Principles and in compliance with international standards established by the International Association of Deposit Insurers Amount of Insured Deposits ■Insured deposits include deposits and accrued interest denominated in Thai Baht accounts, excluding non- resident Thai Baht accounts Blanket guarantee will be gradually phased-out to a limited coverage of Bt1mn per depositor per institution. Until 2011, Thai banks paid 0.40% per year of the daily average deposit amount (paid in June and December), excluding deposits in foreign currencies and deposits from financial institutions not insured by the DPA Since January 27, 2012, the contribution rate has increased from 0.40% to 0.47%, with 0.46% being the contribution to the FIDF, and 0.01% being paid to the DPA. The FIDF fee will temporarily reduce to 0.23% for 2 years* ■Royal Decree on an extension of deposit protection coverage was announced in the Royal Gazette on September 24, 2012 The Cabinet approved a one-year extension of deposit protection up to a maximum of Bt5mn. From August 11, 2021, the protection covers deposits up to Bt1mn. Deposit Accounts in Thailand (as of May 2021) Insured Deposit Under the amending the Deposit Protection Agency Act 11 August 2012-10 August 2015 Up to Bt50mn 11 August 2015-10 August 2016 Up to Bt25mn 11 August 2016 - 10 August 2018 11 August 2018 - 10 August 2019 11 August 2019 - 10 August 2021 11 August 2021, onwards Up to Bt15mn Up to Bt10mn Up to Bt5mn Up to Bt1mn Deposits # of Accounts % Amount (Bt mn) % Less than Bt1mn More than Bt1mn, but less than Bt10mn More than Bt10mn, but less than Bt25mn More than Bt25mn, but less than Bt50mn More than Bt50mn Total 107,525,710 98.36 3,230,749 21.45 1,642,115 1.50 4,098,667 27.21 97,342 0.09 1,438,297 9.55 29,229 0.03 1,027,074 6.82 23,216 0.02 5,266,414 34.97 109,317,612 100 15,061,201 100 Source: Deposit Protection Agency (DPA), the Bank of Thailand, KBank and KResearch บริการทุกระดับประทับใจ * According to the BOT announcement in the Royal Gazette, per the authority of the emergency decree dated April 7, 2020, financial institutions are required to pay 0.23% of the average deposit amount, B/Es, debt instrument (excluding the amount counted as capital), borrowings, and securities transactions under repurchase agreements, during January 2020 to December 2021 119 K KASIKORNTHAI Regulations Update Capital (Basel III) ■D-SIBS* Buffer: Currently, D-SIBS are required to maintain a D-SIBS Buffer at 1% ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK BCBS has finalized the new requirements on risk weighted asset (RWA) calculations including credit risk, operational risk, and CVA risk. The main objectives of the revision are to reduce variability in RWA across banks and jurisdictions and to balance simplicity and risk sensitivity of capital requirements Financial Sector Master Plan II (FSMP II) Year 2010-2014: BOT's FSMP II consists of three key policies: 1) Reducing system-wide operating costs; 2) Promoting competition and access to financial services; and 3) Strengthening financial infrastructure, including market liberalization, which will increase access by foreign financial institutions via granting licenses in some business areas as well as permission to increase number of branches and ATMs ■Year 2014-2015: BOT established a licensing framework for new types of business operations for specific underserved markets, i.e. Nano-finance Financial Sector Master Plan III (FSMP III) 22 Mar 2016: Cabinet approved FSMP III (2016-2020), with aims to establish strategic framework for continuous financial sector development and ensure challenges arising from the changing environment will be effectively managed Overall: FSMP III comprises four main initiatives: 1) Promote electronic financial and payment services as well as enhance efficiency of Thai financial system; 2) Support regional trade and investment linkage; 3) Promote financial access; and 4) Develop relevant infrastructure 1Q17: BOT adopted the 'regulatory sandbox' which allowed regulatory flexibilities to be granted to financial institutions and FinTech companies to experiment with FinTech businesses with plans to grant a new license for P2P lending players or digital personal loan operators ■Mar-21: BOT granted licenses for 2 digital personal loan operators ➤Impacts on Thai banks: Move toward further liberalization and digitalization, along with enhanced competition from FinTech and non-bank companies ➤Impacts on KBank: Ability to maintain competitiveness over both existing and new players, helped by an effective customer-centric strategy and preparation for a changing environment Thai and International Financial Reporting Standards (TFRSS / IFRSS) Year 2020 onwards: Timeframe was specified by Thailand Federation of Accounting Professions (TFAC); TFRS 9 (Financial Instruments) and TFRS 16 (Leases) became effective in 2020; TFRS 4 (Insurance Contracts) will be changed to TFRS 17 and will be tentatively effective in 2024. ➤ Expected impacts on Thai banks: For TFRS 9, expected credit loss is a significant issue due to economic uncertainty from COVID-19 outbreak. For TFRS 17, it will be more transparent and easier to compare financial performance from insurance business. ➤ Expected impacts on KBank: For TFRS 9, Bank's expected credit loss is still based on prudence basis following both TFRS 9 and BOT guidelines. Impacts resulted from TFRS 17 is still under investigation. *Note: D-SIBS = Domestic Systemically Important Banks Source: The Bank of Thailand and KResearch บริการทุกระดับประทับใจ 120#61ธนาคารกสิกรไทย K KASIKORNTHAI Basel III: BOT Minimum Capital Requirement All dates are as of 1 January Conservation Buffer* D-SIBS Buffer** 开泰银行 KASIKORNBANK Transitional Arrangement for Capital Requirement 2016 2017 2018 2019 2020 2021 2022 2023 0.625% 1.25% 1.875% 2.5% 2.5% 2.5% 2.5% 2.5% 0.5% 1.0% 1.0% 1.0% 1.0% 5.125% (4.5%+0.625%) 5.75% (4.5%+1.25%) 6.375% (4.5%+1.875%) 7.5% (4.5%+2.5%+0.5%) 8.0% 8.0% 8.0% 8.0% (4.5%+2.5% +1%) (4.5%+2.5% +1%) (4.5%+2.5% +1%) (4.5%+2.5% +1%) CET1: Min. Common Equity Tier 1 Ratio (after conservation buffer and D-SIBS buffer) Tier 1: Min. Tier 1 Ratio (after conservation buffer and D-SIBS buffer) 6.625% (6.0%+0.625%) 7.25% (6.0%+1.25%) 7.875% (6.0%+1.875%) 9.0% (6.0%+2.5% +0.5%) CAR: Min. Total Capital Ratio (after conservation buffer and D-SIBS buffer) 9.125% (8.5%+0.625%) 9.75% 10.375% (8.5%+1.25%) (8.5%+1.875%) 11.5% (8.5% +2.5% +0.5%) 12.0% (8.5%+2.5% +1%) Countercyclical Buffer (Subject to the BOT consideration)*** Leverage Ratio Parallel run period (Tier 1/Exposure) ≥ 3% 9.5% (6.0%+2.5% +1%) 9.5% (6.0%+2.5% +1%) 12.0% (8.5%+2.5% +1%) 9.5% (6.0%+2.5% +1%) 12.0% (8.5%+2.5% +1%) 9.5% (6.0%+2.5% +1%) 12.0% (8.5%+2.5% +1%) 0.0-2.5% 0.0-2.5% 0.0-2.5% Effective in 2023 (Tentative) Liquidity Coverage Ratio (LCR)**** Effective (Phase-in) (Liquid Assets/Net Cash Outflows within 30 days) ≥ 100% LCR ≥ 60% LCR ≥ 70% LCR ≥ 80% Effective in Jul-18 LCR ≥ 90% LCR ≥100% LCR ≥100% LCR ≥ 100% LCR ≥ 100% Net Stable Funding Ratio (NSFR) NSFR ≥ 100% NSFR ≥ 100% NSFR ≥ 100% NSFR≥ 100% NSFR ≥ 100% NSFR ≥ 100% (Available Stable Funding / Required Stable Funding) ≥ 100% Note: * Conservation Buffer is to ensure adequate capital to absorb losses during periods of financial and economic stress ** D-SIBS (Domestic Systemically Important Banks) Buffer is to limit negative impact associated with the distress or failure of banks on domestic financial system and economy *** In periods of excess aggregate credit growth, BOT may require banks to set a Countercyclical Buffer up to 2.5% to achieve the broader macro-prudential goal of protecting the banking sector **** KBank's Average Liquidity Coverage Ratio (LCR) are 161%, 169% and 189% as of December 2020, June 2020 and December 2019, respectively; more details can be found on Basel III Pillar 3 Disclosures Report Remark: Banks with a capital ratio less than the required regulatory buffers will face various degrees of constraint on earning distribution Source: The Bank of Thailand บริการทุกระดับประทับใจ Tier 1 capital Tier 2 capital K KASIKORNTHAI Capital Definition Change (Consolidated) Basel II Tier 1 • • Issued and paid-up share capital Premium on ordinary shares Common Equity Tier 1 ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Basel III • Issued and paid-up share capital* . Premium on ordinary shares Legal reserve and Retained earnings • Hybrid Tier 1 (<15% of total Tier 1) • Minority interest, Preferred stock Deduction of Tier 1 • Goodwill, Treasury stock, Deferred tax asset Investment in insurance • (50% Tier 1 and 50% Tier 2) Long-term subordinated debt 1 • Legal reserve and Retained earnings 2 3 ⚫ Other comprehensive income (OCI) e.g. surplus on bond and equity FVTOCI (100%), surplus on land & premises (100%) Additional Tier 1 Hybrid Tier 1 with loss absorbency feature . Minority interest, Preferred stock Deduction of Common Equity Tier 1 . Goodwill, Deferred tax asset Intangible assets • Investment in insurance (Threshold Deduction) - Amount ≤ 10% of CET1, %RW = 250% (KBank's Case) - Amount > 10% of CET1, deduct CET1 Long-term sub-debt with loss absorbency feature • Hybrid Tier 1 (exceeds from Tier 1 limit) • General Provision • General Provision • Surplus on AFS equity (45%) * 1 Net Treasury Stock • Surplus on land & premises (70% and 50%) บริการทุกระดับประทับใจ 122 121#62K KASIKORNTHAI TFRS and IFRS Implementation* 2013 2014 2015 2016 2020 ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK 2024** TAS 21: Effects of Changes in Foreign Exchange Rates Translate 'Functional Currency' to 'Presentation Currency' TFRS 8: Operating Segments Disclose operating results for each key segment TFRIC 13: Customer Loyalty Programmes Deferred portion of income for reward credit granted TFRS 13: Fair value Measurement ➤Clear required factors and disclosure about fair valuation TFRS 4: Insurance Contracts ➤ Measure insurance liability based on cash flow estimation Additional disclosure regarding risk exposure Note: TAS Thai Accounting Standard; TFRS = Thai Financial Reporting Standard; TFRIC = Thai Financial Reporting Interpretations Committee OCI Other Comprehensive Income *Only financial and disclosure impact to Thai Banks **Tentatively effective TFRS 16 (Leases) There is a single, on-balance sheet accounting model that is similar to current finance lease accounting. TFRS 9 (IAS 39), TFRS 7 & TAS 32: Financial Instruments Thai banks have implemented a new provisioning rule under IAS 39, since December 2006 ➤ Unquoted equities at cost to be faired value and not able to realize capital gain/loss in profit and loss if they are faired valued through OCI ➤Interest revenue of lending portfolio will be recognized per effective interest rate ➤Investment in property fund, REIT, infrastructure fund and infrastructure trust established in Thailand will be classified as equity instrument. (Refer to announcement from TFRC dated 25 June 2020) TFRS 17: Insurance Contracts ➤Insurance revenue will be based on margin, not gross premium received ➤ Expected day one loss is immediately realized while expected gain is deferred over coverage period K KASIKORNTHAI บริการทุกระดับประทับใจ Government Policy บริการทุกระดับประทับใจ ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK 123 124#63K KASIKORNTHAI Sources and Uses of Public Funds FY2021 Budget ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK FY2021 budget act was approved in September 2020 and was published in the Royal Gazette on October 7, 2020. Budget Planning Tax Revenue + Non-Tax Revenue (Bt2.68trn) + Borrowing under FY2021 Budget Act (Bt609bn) FY2021 Budget (Bt3.29trn) = General Budget (Bt2.54trn or 77%) + Investment Budget (Bt0.65trn or 20%) + Principal Repayments (Bt0.10trn or 3%) Budget Execution Budget Disbursement (100% target disbursement rate + carry-over) General Administration (Bt1.40trn or 42%) ■ Defense ■Homeland security Economic Affairs (Bt521bn or 16%) Development of the country's competiveness ■ Subsidize SOES (e.g. Infrastructure project, free bus and train service policy) ■Infrastructure/Agricultural Development Social and Community Services (Bt1.37rn or 42%) ■ Education ■ Universal Healthcare Extra-Budget Borrowing under Extra-Budget Borrowing Special Act/Decree To relieve the impact of the COVID-19 outbreak, the government approved emergency decree that allows the Finance Ministry to borrow up to Bt1.0trn Notes: Thai government's fiscal year (FY) begins on 1 October and ends on 30 September of the following year. IFF = Infrastructure Fund, PPP = Public-Private Partnership, SFIs = Specialized Financial Institutions Quasi-Fiscal Instrument SFIs taking deposits, borrowing, as well as government subsidy Quasi-fiscal activities (e.g Soft Loan Program) บริการทุกระดับประทับใจ 125 K KASIKORNTHAI Government Fiscal Budget Billion Baht 400 600 1200 1000 800 600 100 163 400 609 200 450 450 469 390 FY2017 FY2018 Budget Deficit Economic Policies ■2020 Budget Act ■2021 Budget Act FY2019 FY2020 Extra-Budget Borrowing Key Points ■FY2020 budget at Bt3.2trn with a deficit of Bt469bn ■FY2021 budget at Bt3.29trn with a deficit of Bt609bn FY2021 ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK ■Thai parliament approved FY2021 budget worth Bt3.29trn, with a deficit of Bt609bn ■Implementation of FY2021 budget effective October 2020 ■To relieve the impact of the COVID-19 outbreak, the government approved an emergency decree allowing the Finance Ministry to borrow up to Bt1trn (Bt600bn for FY2020 and Bt400bn for FY2021), of which Bt600bn will be used for relief measures and public health and Bt400bn will be spent on economic recovery measures ■In addition to growth in commercial bank loans, government funding activities may affect system liquidity Implementation Process FY2020 ■ Effective date: February 24, 2020 FY2021 ■ Effective date: October 7, 2020 Possible Impacts/ Expected Budget ■Government spending will help maintain economic momentum ■Fiscal sustainability to remain manageable in near-term; however, continued debt creation, both from budget deficit and other borrowings, may impact long-term fiscal sustainability Note: Thai government's fiscal year (FY) begins on October 1 and ends on September 30 of following year - NLA = National Legislative Assembly; PPP = Public-Private Partnership Sources: The Ministry of Finance and KResearch (as of October 2020) บริการทุกระดับประทับใจ 126#64K KASIKORNTHAI Public Debt to GDP and Fiscal Budget Public Debt Billion Baht 9,000 60 Public Debt -% to GDP 58 8,500 55.42 56 8,000 7,500 7,000 6,500 6,000 Jan-17 Jul-17 Jan-18 Jul-18 Jan-19 Jul-19 Jan-20 Jul-20 Jan-21 44 42 40 % to GDP % Cumulative Budget Disbursement Rate (%) ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Budget Disbursement Rate 100 80 FY 2021 FY 2020 59.71 60 --FY 2019 47.21 67.82 39.35 34.32 54.00 40 28.56 21.04 20 10.81. 0 ■Public debt to GDP ratio rose significantly to 55.42%, as of May 2021. However, it is still under the 60% limit set under the fiscal sustainability framework ■Thai government committed to keep the ratio of public debt to GDP not exceed 60%. The public debt to GDP is expected to rise to 57.9% in FY2021 Total Budget Bt3.29trn FY21 Budget FY21 target 9M FY2021 actual Unused FY21 Budget Bt3.29trn (100%) Bt2.64trn (100%) Bt0.65trn (100%) Bt2.23trn (68%) Bt1.95trn (74%) Bt0.29trn (44%) Bt1.06trn (32%) Bt0.69n (26%) Bt0.36trn (56%) - General Budget Bt2.64trn - Investment Budget Bt0.65trn ■Government budget disbursement rate for 9MFY2021 is 68%, decreased by 3% from the 70% in 9MFY2020. The disbursement started to catch up after the budget enactment Source: Ministry of Finance (MOF), Fiscal Policy Office (FPO), and Public Debt Management Office (PDMO) บริการทุกระดับประทับใจ K KASIKORNTHAI Relief Measures for COVID-19 Impacts Phase 1 Measures - Soft loans worth Bt150 billion ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK MOF Package Size Measures BOT Package Size Bt400 billion Provide liquidity for bond mutual funds Bt1.0 triillion - Interest cuts and delayed debt payments (SFIs) - Reducing electricity and water bills Phase 2 - Cash handouts - Emergency loans - Tax benefits Phase 3 - Implementing health-related plans and giving financial aid to affected people - Economic and social rehabilitation Bt 120 billion Bt1.0 trillion Bt1.5 trillion or 9.8% of 2020 GDP Note: SFIs Specialized Financial Institutions Source: MOF, BOT and KResearch, as of July 2021 Soft loans and asset warehousing programme Bt500 billion Corporate Bond Liquidity Stabilization Fund (BSF) Bt400 billion Bt1.9 trillion or 12.2% of 2020 GDP บริการทุกระดับประทับใจ 128 127#65K KAŞIKORNTHAI Relief Measures for COVID-19 Impacts ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK Measures from Government, BOT, and SEC for Businesses and Individuals Market Stability and Liquidity (Government, BOT, and SEC) For Businesses ■ Financial Markets: BOT, MOF, & SEC o Bt1trn Fixed Income Fund: BOT set up a special facility to provide liquidity for mutual funds. Commercial banks purchasing investment units can use the eligible underlying unit trust as collateral for liquidity support from the facility o Bond Markets: BOT will purchase bonds to provide liquidity and lessen volatility in the bond market ■ Corporate Bond Stabilization Fund (BSF): BOT • Bt400bn in bridge financing to high-quality firms with bonds maturing during 2020-2021 at higher-than- market 'penalty' rates. (Issuers must raise majority of funding through other means such as bank loans or capital increase) ■ Reduce FIDF Fee: BOT • FIDF fee cut from 0.46% of deposit base to 0.23% for 2 years, supporting lower reference lending rates ■ Tax Relief: Government o Deduct 3 times for salary costs for SMEs that retain their employees o Speed up VAT refunds to exporters of domestic goods to 15 days (online) or 45 days (filing manually) Soft Loans (Government and BOT) For Businesses (Bt680bn) ■ Soft Loans for SMEs: Government and BOT • Gov't: Bt150bn worth of soft loans for SMEs, via GSB, at 2% for 2 years 。 BOT: Bt150bn worth of soft loans for SMEs with credit lines not over Bt500mn (old customers), at 2% for 2 years and 6-months interest free* : Bt250bn worth of soft loans for SME with credit lines not over Bt500mm (old customers) or Bt20mn (new customers) for 5 years with interest not over 5% (0% for the first 6 months and 2% for 2 years) : Bt100bn asset warehousing programme ■ Soft Loans for Entrepreneurs Registered with the Social Security Office: Government o Bt30bn worth of soft loans at 3% for 3 years For Individuals (Bt80bn) ■ Soft Loans for Individuals: Government o Bt40bn worth of soft loans at Bt10,000 per person at 0.1% (no collateral) via GSB & BAAC (Year 2020) o Bt20bn worth of soft loans at Bt10,000 per person at 0.35% (no collateral) via GSB & BAAC (Year 2021) o Bt20bn worth of soft loans at Bt50,000 per person at 0.35% (with collateral) via BAAC (Year 2020) For Individuals ■ Household: Others (Government) o Reduce water and electricity bills for March - May 2020, February - March 2021, May-June 2021, July- August 2021, and refund meter fees ■ Work Force: o 3-month payment of 62% of wages for 2020 and 50% of wages for 2021 to people under SSF, if their employer closed their business or if the government ordered business operations suspended o Reduce SSF contribution to 3% for January 2021 and 0.5% for February - March 2021 o 3-month Bt5,000 monthly payments to workers not covered by the SSF in 2020 o Give Bt9,000 (Bt7,000 and Bt2,000) for February - June 2021 to workers not covered by SSF o Give Bt6,000 (B4,000 and Bt2,000) for March - June 2021 to workers covered by SSF (Section 33, We Love Each Other program) ■ Economy and Health: • Tax exemption on risk payments for medical workers o Bt80-100bn from ministries to use as stimulus funds ■ B500bn borrowing decree in 2021: o Bt30bn for health-related plans • Bt300bn for relief measures, including workforce o Bt170bn for economic recovery plans Notes: BOT = Bank of Thailand; SSF=Social Security Fund; GSB = Government Saving Bank; BAAC = Bank for Agriculture and Agricultural Cooperatives; SFIS = Specialized Financial Institutions The BOT provides soft loans at 0.01% to banks to lend to SMEs; amount to not be over 20% of each SME's outstanding loans; government pays for first 6-months interest; in case of NPLs, the government will support 60-70% of additional reserves for loans - On October 16, 2020, the BOT extended the registration period for another six months and also allowed banks to provide soft loans to the listed companies in the Market for Alternative Investment (MAI) Source: MOF, BOT and KResearch บริการทุกระดับประทับใจ K ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KASIKORNTHAI Overview of Relief Measures for COVID-19 Impacts ■ BOT opted to switch from blanket measures to proactive and more targeted assistance 1Q20 Blanket Measures 2Q20 BOT Business Feb-20 Issued proactive measures to assist borrowers and relax pre-emptive debt Apr-20 Individual Loan Classification Guidelines restructuring rules Mar-20 Issued minimum guidelines covering various types of loan products (inc. the first phase of relief measures for retail) Launched debt holiday for SMEs for 6-month period Jun-20 Implemented second phase of relief measures to assist retail borrowers 3Q20 Sep-20 Launched DR BIZ to help expedite debt restructuring for multi-creditor businesses Sep-20 Implemented debt consolidation 4Q20 Oct-20 Issued debt restructuring guidelines for SMEs after debt holiday has ended 1Q21 Jan-21 2Q21 Targeted Measures Extended current measures to help borrowers affected by new round of COVID- 19 Feb-21 Rolled out credit card and personal loan Debt Mediation Fair for both NPL and non-NPL status Effective Period of BOT relief measures Apr-21 Issued two new measures* to support business recovery and transformation post-COVID-19 Jun-21 • Released guidelines for debt forbearance and restructuring Apr-21 Changed the methods for calculation of default interest and application of debt repayment proceeds May-21 • Issued third phase of relief measures for retail borrowers 3Q21 4Q21 Jul-21 • Provided a two-month debt holiday for individuals and SMEs suffering a direct impact from the latest lockdown The BOT temporarily allows banks to relax loan classification for two years for loans in suspension period of relief measures After debt holiday ended, BOT allowing freeze of loan stages in 2 cases: Oct 20 Dec 20 May Oct 20 Debt holiday 6-month period, Ended on Oct 22,2020 1) SMEs who are in debt restructuring process Oct 20 Dec 21 2)SMEs who cannot forecast their cash flow clearly** Note: According to the Emergency Decree on Financial Rehabilitation and Recovery to support Businesses affected by COVID-19 (B.E. 2564), dated April 19, 2021. (i.e. soft loans and asset warehousing) Source: Bank of Thailand (BOT) บริการทุกระดับประทับใจ 129 130#66K KASIKORNTHAI Relief Measures for COVID-19 Impacts (Continued) For Businesses ■ Loan Payments for SMEs: Measures from BOT Credit Adjustment o 6-month debt holiday on principal and interest payments for SMEs having credit lines not over Bt100mn (ended in October 2020), 2-month debt holiday for SMEs being hit by COVID-19 For Individuals: First phase is minimum guideline for general public. Measure ended in June 2020 ■ Credit Card and Revolving Loans: • Reduce minimum installment payment to 5% in 2020-21 and 8% in 2022, returning to 10% in 2023; refinancing into long-term loans with lower interest rates ■ Personal Loans with Installment Payments and Auto Title Loans: ⚫ (Banks and SFIs), 3-month grace period on principal and interest payments ⚫ (Other lenders), 3-month grace period on principal and interest payments, or pay up to 70% of installments for 6 months ■ Hire Purchase: • 3-month grace period on principal and interest payments, or 6-month grace period on principal payments for motorcycles (<=Bt35,000), automobiles (<=250,000), and leasing (<=Bt3mn) ■ Housing Loans and Micro and Nano Finance: o 3-month grace period on principal payments and case-by-case interest rate cuts for housing (<=Bt3mn) and micro and nano finance (<=Bt20mn) ■ Ease Commercial Bank Loan Rules for Easier Access ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Phase 2: For Individuals: Second phase is to ease burdens of people affected; customer can opt-in to alternative measure suited to their debt service ability ■ Reduce the interest rate ceiling for credit cards and personal loans by 2% to 4% p.a., effective from August 1, 2020 onwards. ■ Increase credit limit from 1.5x to 2x of monthly income for good debtors with a monthly income of less than Bt30,000, from August 2020 to December 2021 ■ Provide alternative measures to help debtors hit by COVID-19 who do not become NPLs, such as suspension on principal and/or interest payment, extension of term loan, payment reduction, or postponement of debt repayment ■ Restructure debt: Fls must focus on debtor's debt service ability in order to relieve their burden Debt Consolidation Program for Individuals ■ Consolidate unsecured loans, hire purchase and housing loan from same creditor to utilize the collateral. For the combined unsecured loan, interest rate is capped not higher than the Minimum Retail Rate (MRR), while loan repayment period can be extended according to the debt service ability of debtor "DR BIZ" Project for Businesses who have multiple financial institution creditors with a total loan of Bt50- 500mn ■ Receive relief measures with all financial institutions in an integrated manner ■ Have main creditors to take care debtors and coordinate with other creditors ■ Around 8,400 debtors with a total loan of Bt1.2trn have qualifications to join the project Phase 3: For Individuals: Extend most measures in phase 2, but add options for customers who want to return cars to close loan contract Loan Classification Standstill: For debt holiday, allow to maintain loan stages for SMEs who are in process of debt restructuring until December 31, 2020; and SMEs who cannot forecast their cash flow clearly until December 31, 2021 Non-NPL (Pre-Emptive): 1) Can immediately classify Non-NPL debtors as stage 1 (stage 1 or stage 2 >> stage 1) 2) Not to be deemed as TDR and not to be reported to National Credit Bureau NPL: Classify as stage 1, under a 3 consecutive-month payment period (from the previous 12 months) Additional Working Capital: Can be classified as stage 1, provided that the debtors have sufficient cash flow for repayment Regulation Relaxation No additional provision for unused credit line Easing liquidity-related regulations, including NSFR and LCR Reducing the FIDF fee from 0.46% of deposit base to 0.23% per annum for a period of two years Source: BOT Report to the BOT Financial institutions are required to submit reports to the BOT detailing target loans and outstanding debts of the debtors who are subject to these measures บริการทุกระดับประทับใจ Other measures Relaxing credit line for emergency cases 131 K KASIKORNTHAI 20-Year National Strategy (2017-2036) ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK (As defined in Section 65 of the Constitution of the Kingdom of Thailand and passed by the NLA in June 2017) ■To achieve the vision "Security, Prosperity, Sustainability", to become a high-income country, to improve quality of life, to generate high income, to escape the middle income trap, and to ensure well-being for all Thais "Security" Key Strategies Security "Prosperity" 2 Competitiveness enhancement Development and Empowerment Human Capital 4 Broadening Opportunity and Equality in Society 6 3 5 Reforming Government Administration Environmentally Friendly growth "Sustainability" " The Goals High income country: 15,000 USD per capita by 2036 (2016 income per capita = 5,901 USD) Economic growth around 5% per year (4-5% under 12th NESDB Social and Economic Development Plan and 5% for the next three NESDB 5-Year Plans) People of all ages healthy and with lifelong learning opportunities Target Gini: <= 0.36 (inequality measurement: lower figure indicates better income distribution) Forest area as percentage of total land area more than 40% Fully implement Digital Government Services Enhance Corruption Perceptions Index beyond 50Plus (the lower tier of least corrupt countries) National Strategy Committee: Chairman is the Prime Minister; Secretary is NESDB Secretary-General 34 committee members First 17 committee members are high-ranking state officials and leading industry experts such as the Prime Minister, members of the top brass, National Police Chief, Permanent Secretary for Defense, President of the House of Representatives, Chairman of the Federation of Thai Industries, President of the National Farmers Council, President of the Thai Bankers' Association, Chairman of the Thai Chamber of Commerce, etc. Second 17 Committee members are experts from various fields 2017 I Jun17: NLA passed the law Aug17: Cabinet appointed committees Jun18: Cabinet endorsed the plan Jul18: NLA approved the plan 2022 2027 2032 The National Economic and Social Development Plan (5-year plan) aligned with the 20-year National Strategy The 12th National Economic and Social Development Plan (2017-2021) The 13th National Economic and Social The 14th National Economic and Social Development Plan (2022-2026) I Development Plan (2027-2031) บริการทุกระดับประทับใจ 2036 The 15th National Economic and Social Development Plan (2032-2036) 132#67K KASIKORNTHAI Government Policy: Long-term Policies ■20-Year National Strategy: To achieve the vision "Security, Prosperity, Sustainability," to become a high-income country, to improve quality of life, to generate high income, to escape the middle-income trap, and to ensure well-being for all Thais (Page 128) ■Transport Infrastructure Development Plan: ➤ Project will reduce logistical costs, increase transportation speed of goods and people, as well as connect Thailand to neighbors along the East-West and North-South Economic Corridors Public Transport Infrastructure Investment 2015 to 2022: worth Bt2.59trn (Page 132) ■ Eastern Economic Corridor (EEC): Area for facilitating and attracting investment in 10 innovative target industries to transform Thailand into Thailand 4.0 (Page 136) ■Digital Economy: ➤ NBTC awarded mobile licenses in various spectrums and launched 5G Government plans to adapt National Digital ID to speed up the process towards digital economy ■ BOI Measures for Supporting Private Investment: Tax and non-tax incentive measures to support private investment, such as Special Economic Zones (SEZs) (10 provinces, including Tak, Mukdahan, Sa Kaeo, Songkhla, Trat, Chiang Rai, Kanchanaburi, Nong Khai, Nakhon Phanom, and Narathiwat) ■Ten targeted industries as new engines of growth: Next Generation Automotive, Smart Electronics, Affluent Medical and Wellness Tourism, Agriculture and Biotechnology, and Food for the Future; New S-Curve (for new growth) consists of Robotics, Aviation and Logistics, Biofuels and Biochemicals, Digital, and Medical Hub ■Additional Incentives: Biotechnology, Nanotechnology, Advanced Materials Technology, and Digital Technology ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK ■ Promote Establishment of International Headquarters (IHQ) and an International Trading Center (ITC) in Thailand: Help Thailand become a key trading nation in the region ■ ASEAN Economic Community (AEC): Since December 2015, ASEAN has transformed into the "ASEAN Economic Community," with free movement of goods, services, investment, and skilled labour, and a freer flow of capital; Strategic measures under the five characteristics in the AEC Blueprint 2025 will be operationalised through sectoral work plans and their implementation and monitored through the AEC 2025 Monitoring and Evaluation Framework ■ Free Trade Area: Already signed FTA with ASEAN+3 (China, Japan, and Korea), India, Australia, New Zealand, Peru, Chile; In progress with Canada, European Union (EU), the Regional Comprehensive Economic Partnership (RCEP), and Comprehensive and Progressive Agreement of Trans-Pacific Partnership (CPATP) ■ Age Society: Mandatory retirement age for government and state enterprise officials will be extended from 60 to 63, effective in 2024 ■ Energy Policy: Reform petroleum concessions and energy price structures, including an LPG subsidy ■Tax Reform: Reform tax collection, generate sufficient revenue for the government, and boost competitiveness for local businesses, especially SMEs ■Constitution: National assembly seeks to amend the constitution section-by- section Sources: Newspaper and KResearch (as of April 2021) บริการทุกระดับประทับใจ k KASIKORNTHAI Government Policy: Short-term Policies ■Government Budget: ➤ Fiscal budget deficit in FY2021: plans for Bt609bn deficit to provide additional supports to Thai economy amid COVID-19 outbreak (Page 122) ■Relief Measures for COVID-19 Impacts: Helping financial market stability and liquidity, and business, work force, and individuals through soft loan programs and relief measures (Page 124-127) ■Short-term Stimuli: ➤ Welfare Card: Give Bt200-300 a month to each welfare smart card (14.5 million people) for purchase of necessary goods for those earning less than Bt100,000 annually; Give Bt500 wallets to help with transportation costs Thailand Plus Package: attract foreign investment, especially to expedite investments from companies seeking to relocate as a result of ongoing trade war' ➤ Cash handout for workers not covered by SSF: Bt5,000 monthly payments for 3 months to informal workers affected by COVID-19 (April - June 2020) ➤ Supporting tourism: Subsidies for domestic tourists (Moral Support & We Travel Together campaigns) (July 2020 to April 2021); "Special Tourist Visa" for long- staying visitors (90 day stay in country, which can be extended twice, each for an additional 90 days. The visa costs Bt2,000 per 90-day extension) Property stimulus package: Property transfer fees reduced from 2 percent to 0.01 percent and mortgage fees reduced from 1.0 percent to 0.01 percent for buying condominium units priced at not over Bt3mn (Jan - Dec 2021) ➤ Measures to help farmers: Many price insurances for agricultural plants such as rice, rubber, oil palm, cassava, and corn (Bt75bn for 2021 government budget) ■ Short-term Stimuli (continue): ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK ➤ Projects to boost domestic consumption: 1) "Half-Half" scheme: a co-payment for food and general products subsidizing half of the purchase price - Phase 1&2: Bt3,500 to 15 million people (October 2020 - March 2021) - Phase 3: Bt3,000 to 31 million people (July - December 2021) 2) Additional Bt500 given each month to 14 million people holding welfare cards (October 2020 - March 2021) 3) Section 33 - We Love Each Other program: Bt6,000 (Bt4,000 and B2,000) given to people who meet the deposit conditions of less than Bt500,000 during March June 2021 4) We Win program: Bt9,000 (Bt7,000 and Bt2,000) per person during February - June 2021 5) "Ying Chai Ying Dai" program: Give e-vouchers (up to Bt7,000) to people who spend money from July - September 2021 to encourage purchase of food, products, and services through the government's e-wallet (can be used from August to December 2021) Measures to help employers and employees Reduce the monthly contribution rates to the SSF to 2.5%, from 5% of wages; applicable for 3 months ( June - August 2021) For employees and employers in six provinces Under Section 33: Employee receive Bt2,000 each in compensation and half of their daily wages, not to exceed Bt7,500 Employer: receive Bt3,000 for each worker (not more than 200 persons) Not covered by Section 33: Employee: receive Bt2,000 baht in compensation (Thai nationality) Employer: receive Bt3,000 baht for each employee (not more than 200 persons) Sources: Newspaper and KResearch (as of July 2021) บริการทุกระดับประทับใจ 133 134#68K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Ongoing Government Measures to Assist Cost of Living Household Assistance Measures Energy Prices Elimination of some Oil Fund levies (effective Diesel Price 35 33 Baht/Litre 27 22222- Price moves in accordance with global oil prices 29.99 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18 Jan-19 --- Retail Price Price without Subsidy Details Train and Bus Fares: Bt500 monthly allowance for welfare card holders to use for bus and train service Necessity Goods: A Bt100* grant per month in welfare card to purchase necessity goods, products intended for education and farming materials from all Blue Flag shops Cooking Gas: A Bt45 discount each quarter in welfare card for purchasing cooking gas Allowances (e-Money): Up to Bt 200** for e-Money in welfare card, which can be withdrawed from an ATM Water and electricity price: Reduce water and electricity bills and refund meter fees Diesel Fuel: Government intends to restructure diesel fuel prices to reflect global prices NGV and LPG Price: Government lowered the NGV and LPG subsidy, allowing retail selling prices to reflect global market prices ■ NGV price rose to Bt15.31/kg since April 2019, align with global price LPG prices are as follows: ➤ Household sector: Current household LPG prices are Bt18.87/kg and Bt16.37/kg for low income household. ➤ Transport sector: adjusted to market price at Bt18.87/kg ➤ Industrial sector: adjusted in line with relevant production costs, currently at Bt18.87/kg FT Rate: Fuel Adjustment Tariff (FT) Rate for electricity is set to increase by less than the actual cost (from May-August 2021, FT rate at Bt-0.1532/unit) Value-added-tax (VAT) Rate On August 25, 2020, the Government announced the following VAT Rates: ■Maintain the 7% value-added-tax (VAT) rate until September 30, 2021 Note: *Effective period July- October 2019 ** Household income exceed Bt30,000 per annum will get Bt 100 for e-Money Source: KResearch บริการทุกระดับประทับใจ K KASIKORNTHAI Public Transport Infrastructure Investment 2015 to 2022 Type of Projects Source of funds ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Project Detail (Total Budget) Total projects of "Thailand strategic development of transport infrastructure 2015 to 2022" master plan* 6. Air Transport 6% 5. Marine Transport 6% 4. Dual-Track Railways 15% 3. Bangkok and Mass- Transit system 7. Others 1. High-speed 6% Rails 34% LIA State PPP 22% Enterprise TFF 12% fund 1. High-speed Rails (Bt1,006.7 bn) 4. Dual-Track Railways (Bt438.2bn) 2% 2. Motorway & Roads (Bt512.3 bn) 5. Marine Transport (Bt187.6 bn) Govern ment Loan 3. Bangkok and Mass-Transit system (Bt476.7 bn) 6. Air Transport (Bt183.5 bn). Govern 35% ment 2. Motorway & Roads 17% Budget 29% Total Budget Number of projects Total disbursement Total projects 119 New vs on-going projects Bt3,017,600mn Project Detail (Expected disbursement in 2021) Type of Projects 1. Bangkok and Mass-Transit system(Bt48.1 bn) 4. High-speed Rails (Bt30.2 bn) 6. Air Transport 7. Others 2% 1. Bangkok and Mass-Transit system 31% New projects 11% For 2021, public infrastructure investment is estimated to be B175bn or 12% higher than 2020* 5. Marine Transport 9% 3% 4. High-speed Rails 16% 3. Dual-Track Railways 17% 2. Motorway & Roads 22% 2. Motorway & Roads (Bt40.2 bn) 5. Marine Transport (Bt15.7 bn) 3. Dual-Track Railways (Bt30.8 bn) 6. Air Transport (Bt6.1 bn) On-going projects 89% Number of projects 35 31 4 Total disbursement Bt175.1bn Bt126.4bn Bt48.7bn Expected in 2021 Total projects On-going projects New projects Source: Office of Transport and Traffic Policy and Planning (Thailand strategic development of transport infrastructure 2015 to 2022 master plan) and KResearch (July 2021) Notes: PPP = Public-Private Partnership, TFF fund = Thailand future fund. Total investment may be reduced due to cutting the scope of work, delay in construction, and allocation of state disbursement for COVID-19 relief measures * The budget of Bt1.91trn referring "Thailand strategic development of transport infrastructure 2015 to 2022 master plan" are excluded High-speed train (Bt637.3bn) and Suvarnabhumi airport (Bt104.4bn), but our estimation include both of these projects บริการทุกระดับประทับใจ 135 136#69k KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Projections on Budget Disbursement of Public Transport Infrastructure Investment As the COVID-19 situation intensifies and is still highly uncertain, budget disbursements in 2021 are revised down and deferred to 2022-2024 on the view that the situation would not be worsen in coming years. Budget disbursements in 2022-2024 will be driven by mega-projects in EEC such as High-Speed Rail Linking 3 Airports, Map Ta Phut phase 3. Investment Disbursement Schedule (FY2016-2030)* Notes: Billion Baht 400 350 352.0 324.4 322.4 309.9 300 250 200 250.5 222.9 175.1 I 156.8 250.5 148.3 145.7 150 100 65.1 50 36.8 24.5 19.1 0 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Thai government's fiscal year (FY) begins on 1 October and ends on 30 September of the following year - Due to 1 month lockdown period start from 28 June 2021 - 28 July 2021 investment are expected to be deferred to 2022-2023. - Projects that were delayed or terminated by Cabinet are not included - The budget of Bt1.91trn referring "Thailand strategic development of transport infrastructure 2015 to 2022 master plan" are excluded High-speed rails (Bt637.3bn) and Suvarnabhumi airport (Bt104.4bn), but our estimation include both of these projects Source: Office of Transport and Traffic Policy and Planning (Thailand strategic development of transport infrastructure 2015 to 2022) Note: *KResearch projected as of July 2021 บริการทุกระดับประทับใจ K ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KASIKORNTHAI On-going highlight projects under construction in 2021* Projects under construction Lop Buri - Pak Nam Pho Bang Yai- Kanchanaburi Motorway Jira Junction - Khon Kaen Mabkabao Jira Junction Bang-Pa-In-Nakhon Ratchasima Motorway Bangkok-Nakhon Ratchasima Bang Suê – Rangsit Lad Prao Samrong Nakhon Pathom-Hua Hin Suvarnabhumi Airport (Phase II) Thailand Cultural Center- Min Buri Hua Hin - Prachuap Khiri Khan Prachuap Khiri Khan... Chumphon Khae Rai Min Buri Dual-Track Train Mass-Transit System and Commuter Train High Speed Train Airport Motorway Single Rail Transfer Operator Intermodal Facility Projects under construction Expected completion year Note Air Transport: Suvarnabhumi Airport Phase 2021 2 90% in progress Expected completion year Note Motorways: Bang Pa In-Nakhon Ratchasima 2021 95% in progress (M6) Bang Yai-Kanchanaburi (M81) 2023 Projects under construction Expected completion year 50% in progress Note High Speed Rails: Thailand-Chinese (Bangkok-Nakhon Ratchasima) 2027 Projects under construction Expected completion year Contract lots 3-2 to 4-7**, worth Bt40,275mn are under construction.. New contract. lots worth Bt27,527mn are signed (4-3, 4-4 and 4-6) which expected to start construction in late 2021 Note Mass-Transit System and Commuter Rail Lines: Yellow line (Lad Prao-Sam Rong) Orange line (Thailand cultural center-Min Buri) 2021 65% in progress 2023 76% in progress Pink line (Khae Rai-Min Buri) 2021 70% in progress Projects under construction Expected Note completion year Dual-Track Railways: Nakhon Pathom-Hua Hin 2021 70% in progress Hua Hin-Prachuap Khiri Khan 2021 50% in progress Lop Buri-Pak Nam Pho 2021 55% in progress MabKabao-Jira Junction Prachuap Khiri Khan-Choom Porn 2021 75% in progress 2021 60% in progress Source Ministry of Transport and KResearch (July 2021) Notes: Projects that visibly have construction progress on-site or have been stated in official documents that it had been constructed *There are currently 30 projects under construction. For the purpose of visualization, only highlight projects are shown in this presentation **Contract lots are 3-2, 3-3, 3-4, 3-5, 4-7 which have construction disbursement of Bt40,275mn and 1080 construction days บริการทุกระดับประทับใจ 138 137#70K KASIKORNTHAI Upcoming Infrastructure Projects Upcoming Infrastructure Projects by Status EHIA/TOR/Bidding Process Status High-Speed Rails: Bangkok-Rayong (3 Airports) Preparing + Land Marine Transport: Leam Cha Bang phase 3 Map Ta Phut phase 3. Air Transport: Suvarnabhumi Airport 3rd runway U-Tapao Airport reclamation Expected to start construction Note End of 2021 or beginning - Land reclamation are 86% in progress of 2022 Land reclamation 2022 Preparing for construction 2021 Bidding (passed 2022 EHIA) -To increase flight capacity from 68 to 90 flights per HR Preparing for construction 2021 ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Upcoming Infrastructure Projects by Areas Denchai-Chiang Rai-Chiang Khong High speed train Bangkok to Chiang Mai Light rail in Chiang Mai Regional airport development (Chiang Mai) Denchai to Chiang Mai Pak Nam Pho to Denchai Khon Kaen to Nong Khai Banpai-Mukdahan-Nakhon Panom Light rail in Khon Kaen Regional airport development (Khon Kaen) Jira to Ubon Ratchathani Light rail in Nakhon Ratchasima Dark Red Line (Rangsit to Thammasat University) (Orange Line (Bang Khun Non to Thailand Cultural Center) Purple Line (Tao Poon to Rat Buran: | Rangsit to Bang Pa-in Bangkok to Mahachai Nakhon Pathom to Cha-am — Red Line (Bang Sue to Hua Mak and Bang Sue to Hua Lamphong) Red Line (Taling Chan to Siriraj and Taling Chan to Salaya) Donmuang Airport Development Phase 3 and Suvarnabhumi Airport U-Tapao International airport Laem Chabang deep sea port development phase 3 Dual-Track Railways: Den Chai-Chiang Rai, Ban Pai-Nakorn Panom Land reclamation 2022 Mass-Transit System and Commuter Rail Lines: Purple line (Tao Poon-Racha Burana) 2022 -Expect to delay due to a change in TOR Orange line (Bang Khun non-Cultural center) Land reclamation 2022 -Expect to delay due to EIA Dark Red line (Rangsit) 2022 process High speed train Bangkok to Hua Hin Map Ta Phut deep sea port phase 3 Projects Preparation for approval by Cabinet/ PPP Process /EIA Process** Status Dual Track Railway High-Speed Rails: Thai-Japanese (Bangkok-Chiang Mai) Bangkok to Hua Hin - May be asked for approval by Cabinet Chumphon to Surat Thani Thailand-Chinese (Nakhon Ratchasima-Nong Khai) in 4Q21 Air Transport: Suvarnabhumi Airport Phase 3 (North building expansion). Motorways: Hat Yai to Malaysia Border Samut Prakan to Bangkok to Samut Sakorn Dual-tracks Railways: Pak Po-Den Chai, Jira-Ubonracha Thani, Khon Kean-Nhong Kai, Choom Porn- Surat Thani, Surat Thani-Song Khla, Had Yai-Padang Besar - EIA and PPP process Preparation for approval by Cabinet - EIA and PPP process EIA process Preparation for approval by Cabinet Regional airport development (Krabi) Regional Airport (Nakom Srithammarat T Katu to Patong in Phuket Mass Transit System and Light Rails High Speed Train Airport Surat Thani-Hat Yai-Songkhla Light rail in Phuket Regional airport development (Trang) Hat Yai to Padang Besar Motorway/Expressway Port Hat Yai to Malaysian border บริการทุกระดับประทับใจ Source: Ministry of Transport and KResearch (July 2021) Notes Some projects are expected to be delay due to COVID-19 situation 139 K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK Eastern Economic Corridor (EEC): Three eastern provinces: Chachoengsao, Chon Buri, and Rayong ■Objectives: To facilitate and attract investment in 10 innovative target industries aimed at achieving "Thailand 4.0", an innovation driven society (the 10 industries are Next-Generation Automotive, Smart Electronics, Medical and Wellness Tourism, Food for the Future, Robotics, Aviation, Agriculture & Biotechnology, Biofuels & Bio Chemicals, Digital, and Medical Hub) ■ Key Development Plan: An expansion of existing transportation facilities, plus new investment in logistics systems to transform the EEC area (13,266 square kilometer) into a regional center for trade, investment, and tourism ■ Approved Investment Amount: Bt1.1 trn (during 2019-2020) from industries & private businesses 429 bn Bt and infrastructure development 683 bn Bt; high-priority projects to start in 2019 are U-Tapao Airport, high speed railways from Bangkok to Rayong, the third phase of Laem Chabang Port and Map Ta Phut Port, and the maintenance repair and overhaul (MRO) campus. ■Investment Incentives: EEC privileges corporate income tax (CIT) exemption of up to 13 years and additional 50% CIT reduction for up to five years for some projects; 15-year CIT exemption for qualified projects under Thailand Competitive Fund (R&D investment); a flat tax rate of 17% personal income tax (PIT) for experts/specialists; long-term land leases (up to 99 Years) Four Core Areas - 15 Crucial Investment Projects* 'A' Chachoengsao A Chonburi 1 U-Tapao airport and aircraft maintenance 2Sattahip commercial seaport Laem Chabang port phase #3 Map Ta Phut port phase#3 5 High-speed rail-east route 6 Double-track railway ++++ 8 Highways and motorway Next-generation automotive (EWAV) 9 Aviation industry, Robotics, Smart electronics 10 Advanced petrochemical and Bioeconomy Industries and private business, 429 Approved Investment Amount (Bt1.1trn during 2019-2020) Unit: Billion Bt Infrastructure, 683 11 Rayong Medical hub A 呔 12 Tourism 13 Global Business Hub / Free Economic Zone 14 New Cities, Inclusive growth 15 Public Utilities Source: The Board of Investment of Thailand (BOI), and The Eastern Economic Corridor Office of Thailand (EECO) presentation and KResearch projected (as of April 2021) บริการทุกระดับประทับใจ 140#71K KASIKORNTHAI EEC Progress ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Expected Projects Amount Owner Contract Signed Beginning Name of the selected JV Construction project completion High-Speed Rail Linking 3 Airports Bt224.5bn State Railway of Thailand Oct 2019 Charoen Pokphand Group (CP) led Consortium (CP, Italian Thai, CH. Karnchang, China Railway Construction Corp) 4Q21 2025 U-Tapao Airport and Aviation City Bt290bn Royal Thai Navy Jun 2020. Bangkok Airways led Consortium (Bangkok Airways, BTS, Sino-Thai) 4Q21 2025 GPC Bt84.4bn Jul 2021 (Gulf Energy Development Pcl + PTT Tank Terminal China Habour) 1Q22 (F Dock) Laem Chabang seaport (3rd Phase) and Port Authority of Thailand for F Dock Development and 2025 C NNC 1Q21 Bt 21.3 bn Aug 2020 (NTL Marine + Nathalin + Zhonggang Construction) (Land reclamation) for Land reclamation project Map Ta Phut seaport (3rd Phase) Bt55.4bn Industrial Estate Authority of Thailand Oct 2019 PTT Tank Terminal + Gulf Energy Development Pcl 3Q21 2026 Note As Thai Airways is restructuring and no longer as a state enterprise, Maintenance, repair and overhaul (MRO) centre has been cancelled since March 2021. Bangkok Airways is now become new potential investor of MRO project (but the agreement has not yet finalized.) Source: Newspaper, Eastern Economic Corridor Office of Thailand and KResearch as of April 2021 K KASIKORNTHAI บริการทุกระดับประทับใจ Thailand Economic Figures ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK 141 บริการทุกระดับประทับใจ 142#72K KASIKORNTHAI Currency and Interest Rate Outlook USD/THB: End Period ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Interest Rate Trend Bt 35.97 35.84 4.00 Fed Funds rate BOT's 1-Day Repurchase rate 37 32.68 32.91 2.75 33 30.60 32.66 32.55 32.75 2.25 29.95 2.00 29.98 2.00 1.50 1.50 1.50 1.75 1.25 29 4Q12 4Q13 4Q14 4Q15 4Q16 4Q17 4Q18 4Q19 4Q20 4Q21F 0.00 ■ Baht appreciated to around Bt32.6 per USD late August 2021 after a correction on short position on THB against USD However, Baht would hit 32.75 per USD at the end of 2021 as Fed's tapering pressure, impact of COVID-19 to Thai economy and current account deficit 0.50 0.50 0-0.25 0-0.25 0-0.25 0.25-0.50 0.50-0.75 1.25-1.50 2.25-2.50 1.50-1.75 0.00-0.25 0.00-0.25 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18 Dec-19 Dec-20 Dec-21F ■Fed would announce the QE tapering program later this year, and keep the Fed Funds rate of 0.00- 0.25% in response to more persist inflation pressure and improving job market data BOT would maintain its policy rate at 0.50% in 2021 after maintaining a FIDF fee cut at 0.23% until the end of 2022 and pointing credit measures having more effective liquidity to effected groups Note: F is estimated by KBank Capital Markets Research (as of August 18, 2021) บริการทุกระดับประทับใจ K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Monthly Economic Conditions: May-June 2021 143 2019 2020 YTD Units: YoY %, or indicated otherwise Private Consumption Index (PCI) Non-durables Index Durables Index Service Index Passenger Car Sales Motorcycle Sales Private Investment Index (PII) -2.6 -5.2 Construction Material Sales Index -0.7 -3.5 4Q-20 1Q-21 Dec-20 Jan-21 2.3 -1.9 1.8 -1.1 2.3 -1.7 -1.9 -4.2 -0.1 -1.7 -12.3 1.1 -2.2 6.9 2.9 -21.3 -23.4 -17.3 -27.8 -1.6 -28.4 0.5 -10.1 10.6 -3.3 -10.2 -4.0 0.7 11.0 0.9 6.9 6.2 -5.9 3.9 -1.3 Feb-21 Mar-21 Apr-21 May-21 Jun-21 2020 3.3 -4.6 -2.5 3.6 12.6 0.5 1.8 -8.7 -3.2 -0.8 5.4 -4.3 -2.5 -12.3 -7.7 13.3 54.9 24.3 -29.1 -19.7 0.5 14.1 -0.6 -28.2 -15.8 29.3 119.8 44.7 -6.2 -5.7 15.3 63.5 42.3 2.5 8.1 9.8 10.7 -8.9 16.5 17.1 28.0 12.6 3.8 -0.9 8.5 -6.1 223 2.3 1.7 Domestic Machinery Sales at constant prices -5.4 -4.9 7.4 9.4 11.4 6.2 8.4 12.8 36.7 57.2 21.9 Imports of Capital Goods at constant prices -0.9 -11.4 -4.1 16.3 4.8 2.9 30.6 19.8 20.9 30.3 30.3 Newly Registered Motor Vehicles for Investment -3.0 -10.9 5.8 Manufacturing Production Index Capacity Utilization Agriculture Production Index Agriculture Price Index 1.9 Tourist arrival growth Exports (Custom basis) Price Volume Imports (Custom basis) -1.8 3.1 Volume 4.8 Trade Balance ($ millions) (Custom basis) Current Account ($ millions) Headline CPI Core CPI Price 0.2 -2.0 -5.7 -11.8 -4.3 10,009 24,477 3,063 516 711 182 796 38,206 16,539 -1,168 -2,551 -829 -673 -1,071 -806 -1298 -2624 0.71 -0.90 -0.40 -0.53 -0.27 -0.34 -1.17 -0.08 3.41 2.44 0.52 0.30 0.18 0.12 0.19 0.21 0.04 0.09 0.30 0.49 0.1 27.7 -4.0 -5.2 -3.6 -9.3 -1.6 0.8 -2.8 -2.0 -1.3 66.0 60.8 63.8 64.7 64.2 64.7 64.3 -0.3 -4.1 -2.1 3.6 -7.5 1.3 6.7 3.0 0.6 6.1 11.1 9.7 11.3 7.1 9.1 12.8 13.3 15.1 4.6 -83.2 -99.9 -99.7 -99.8 -99.8 -99.7 -99.2 N.A. N.A. -2.6 -6.0 -2.0 0.9 4.7 0.2 -2.7 8.3 13.1 41.6 0.3 -0.8 -1.4 -1.9 -3.1 -3.7 -5.9 -1.6 5.0 4.5 -4.8 -12.4 -4.2 9.4 3.6 -1.3 9.3 16.6 35.4 5.9 65.2 8.6 18.0 25.8 4.3 ■Thailand's economic indicators in May reflected a declining trend in economic activity, due to the pandemic 9.4 Private consumption index contracted at a higher pace MOM, but improved YoY, due to low base effect ■ Exports strongly increased, as global demand started to 65.2 65.2 64.9 recover 0.6 3.0 11.4 Current account recorded a -99.5 deficit for seven consecutive 10.8 1.2 964 -202 ■ June headline inflation and core inflation edged higher at a lower rate, due to government measures relating to utility expenses Sources: Bank of Thailand (BOT), Ministry of Commerce (MOC), Office of Industrial Economics (OIE), and Office of Agricultural Economics (OAE) บริการทุกระดับประทับใจ -2.6 -2.4 -0.7 -0.2 1.9 -1.2 -2.2 11.8 14.6 38.5 -5.2 21.9 14.2 29.7 63.5 -0.9 2.2 8.4 10.1 7.7 -6.0 21.1 2.9 14.7 43.2 -0.8 11.2 months, due mainly to service balance 21.5 6.8 12.1 7 1,494 -6473 1.25 0.83 0.52 0.23 144#73% YoY of MPI K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KR Household Economic Condition Index (KR-ECI) ■ The third wave of COVID-19, which emerged in early April, has yet been brought under control as the number of daily infections remains at an elevated level. The prolonged pandemic caused the KR-ECI to slip to 36.7 in June 2021, from the 37.3 reported for May and 37.2 recorded in January 2021. ■ The 3-month Expected KR-ECI also dropped to 38.9 in June 2021, against the 39.4 recorded in May, suggesting that households were still concerned about the rising cost of living. KR Household Economic Condition Index (KR-ECI) KR-ECI 50.0 48.0 46.0 44.0 42.0 40.0 38.0 36.0 34.0 32.0 30.0 Source: KResearch Current KR-ECI -3-month Expected KR-ECI 39.4 38.9 37.3 36.7 Components of 3-month Expected KR-ECI 3-month Expected KR-ECI 31.6 32.5 41.1 42.4 41.6 42.6 29.9 30.0 37.0 36.2 ■Jun-21 May-21 T 10 20 30 40 50 Notes: The KR Household Economic Condition Index (KR-ECI) has been devised by KResearch to monitor household sentiment towards economic conditions at the current level and over the next three months. Any reading above 50 reflects positive sentiment and below 50 negative sentiment. - Research sample includes households in Bangkok and Metropolitan Area (BMA). KR-ECI consists of household savings, household income, household debt, household expenses excluding debt and prices of consumer goods. บริการทุกระดับประทับใจ K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Economic Condition Highlights: May-June 2021 May21 MPI edged higher MOM, due to export situation, while CAPU remained flat Activities in real estate market, except condominium registrations, were higher in 1Q21 10 -10 3220225 Jan-17 Jul-17 25.8 85 75 65.2 65 55 45 35 Jan-18 Jul-18 Jan-19 -MPI (Ihs) Jul-19 Jan-20 Jul-20 -%Capacity Utilization (rhs) Jan-21 % Capacity Utilization Rate лол % 400% 300% 200% 100% 0% -100% 1Q09 1Q10 1Q11 1Q12 1Q13 1Q14 1Q15 1Q16 1Q17 1Q18 1Q19 1Q20 1Q21 Construction areas permitted Nationwide Condominium Registration Nationwide 0.02 -0.21 -0.51 New Housing registered in BKK and Vicinity Jun21 headline inflation and core inflation were up by 1.25% YoY and 0.52% YoY, respectively, due mainly to very low base last year Single house and townhouse showed small growth in 1Q21, but prices of land increased at higher rate 1.25 1.0 4.00 20.0 3.00 2.00 0.5 10.0 1.00 %MoM 0.00 -1.00 0.0 лол% 0.0 -2.00 0.52 -3.00 -10.0 -0.5 -4.00 Jan-17 May17 Sep-17 Jan-18 May 18 Sep-18 Jan-19 May 19 Sep-19 Jan-20 May 20 Sep-20 Jan-21 May21 Headline CPI (MoM-hs) Core CP I(MoM-Its) Headline CPI (Y OY -rhs) Core CP I(Y OY -rhs) 7.5 0.8 TTT 0.8 1Q09 1Q10 1Q11 1Q12 1Q13 1Q14 1Q15 1Q16 1Q17 1Q18 1Q19 1Q20 1Q21 Single House (With Land) Sources: Bank of Thailand (BOT), Ministry of Commerce (MOC), University of the Thai Chamber of Commerce (UTCC), and Office of Industrial Economics (OIE) บริการทุกระดับประทับใจ Townhouse (With Land) Land 145 146#74k KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Economic Condition Highlights: May-June 2021 May CCI continued to decline, due to the worst COVID-19 situation, while Jun BSI increased but was still below the 50-threshold May PCI was lower MOM, due to new wave of COVID-19, but higher YoY, due to low base effect CCI LAGGOROGORO 90 85 80 75 70 60 46.5 55 50 65 60 55 50 45 45 44.7 40 35 40 30 Jan-16 Jul-16 Jan-17 Jul-17 Jan-18 Jul-18 Jan-19 Jul-19 Jan-20 Consumer Confidence Index (CCI) Jul-20 Jan-21 Business Sentiment Index (BSI) 50.0 40.0 20.4% 8.9% 9.4% 7.3% 4.2% BSI % YOY 60% 28% 35.40% 30.30% 24.30% 0.50% 2.30% May21 Foreign tourist arrivals stayed low, as international travel restrictions remained 1020 2020 Oct-20 Nov-20 Dec-20 Jan-21 Feb-21 Mar-21 Apr-21 May-21 Exports in May21 continued to show strong positive growth, due to improving economic activity in some countries 30.0 -6.5% 20.0 10.0 24.8 Million Person 0.0 29.9 32.5 35.6 38.2\ 50% Export Value (USD Million) 0% 28,000 24,000 -83.2% -50% 20,000 -99.5% N.A. 16,000 -100% 12,000 8,000 0 -150% 4,000 2014 2015 2016 2017 2018 2019 2020 5M21 May-21 No of Foreign Tourist Arrival % Tourist Arrival YoY (RHS) Sources: Bank of Thailand (BOT), Ministry of Commerce (MOC), University of the Thai Chamber of Commerce (UTCC), and Office of Industrial Economics (OIE) บริการทุกระดับประทับใจ K KASIKORNTHAI Exports and Imports: 5M21 Exports by Country Middle East 3.3% Others 17.4% ASEAN CLMV 9.6% Hong Kong 24.1% 4.2% Australia China 4.3% 13.7% EU 8.7% U.S.A Japan 9.6% 14.7% Top 10 Exports by Product (Customs Basis) Exports 4.30% -0.60% PC PII Registered Motor Vehides Construction Materials Imports of Capital Goods Consumer's Non Durable Consumer's Durable Consumer's Service % YoY 48.8 60 40 20 0 6 -20 -40 Jan-16 Sep-16 May-17 Jan-18 Sep-18 May-19 Jan-20 Sep-20 May-21 Exports excluding gold Exports % YoY ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK Imports by Country Others Taiwan 20.9% 3.8% Middle East China 24.2% 7.4% U.S.A. 5.5% EU Japan 6.9% 13.6% ASEAN 17.8% CLMV 5.5% Top 10 Imports by Product (Customs Basis) Total Exports, Custom Basis USD Millions 5M21 Weight Import, Custom Basis % YoY USD Millions 5M21 Weight % YoY Total Exports, 108,635 100.0% 10.8% Total Imports, 107,141 100.0% 21.5% Electronic machines 16,741 15.4% 18.6% Crude oil 9,553 8.9% 22.9% Motor cars, motor vehicles, parts and Machinery and parts 8,629 8.1% 12.0% 12,432 11.4% 51.6% accessories Chemicals 8,127 7.6% 27.1% Electrical equipment 11,777 10.8% 27.1% Electrical machinery and parts 7,749 7.2% 14.4% Chemical products 3,665 3.4% 35.5% Electrical, electronic equipment and parts 7,673 7.2% 17.0% thereof Precious stones and jewellery 3,549 3.3% -62.9% Iron, steel and products 6,266 5.8% 38.6% Machinery and parts thereof 3,175 2.9% 18.7% Jewellery including silver bars and gold 5,928 5.5% 109.2% Refine fuels 3,138 2.9% 25.6% Other metal ores, metal waste scrap, and Textiles 2,600 2.4% 8.0% 5,071 4.7% 43.4% products Iron and steel and their products 2,588 2.4% 27.3% Parts and accessories of vehicles 4,787 4.5% 21.6% Rubber 2,333 2.1% 54.6% Vegetables and vegetable products 3,849 3.6% 24.7% Source: Ministry of Commerce บริการทุกระดับประทับใจ 148 Exports excluding gold % YoY 147#75K KASIKORNTHAI Export and Import Data: 2015 - 2020 Exports by Country ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Imports by Country 8.7% 20.4% 14.9% 20.6% 22.0% 22.8% 22.9% 21.7% 22.2% 4.8% 3.4% 22.6% 22.7% 21.2% 9.1% 7.0% 4.8% 5.4% 3.3% 3.8% 14.8% 7.7% 6.8% 8.2% 8.3% 5.6% 9.9% 6.2% 11.2% 11.4% 11.2% 11.1% 6.7% 7.3% 12.7% 10.2% 6.1% 14.9% 15.4% 15.8% 9.4% 9.5% 9.3% 9.9% 14.5% 10.0% 14.1% 14.0% 14.0% 11.1% 11.0% 12.5% 12.0% 11.8% 8.2% 20.3% 24.9% 21.6% 20.0% 20.0% 21.3% 10.3% 10.2% 10.1% 9.9% 9.6% 11.5% 8.9% 8.2% 10.4% 10.3% 10.6% 11.6% 11.2% 4.8% 9.3% 9.5% 8.9% 8.8% 5.5% 24.4% 4.9% 4.8% 4.9% 5.7% 15.3% 15.1% 14.6% 15.5% 14.4% 19.0% 13.9% 13.8% 13.4% 18.9% 13.3% 2015 2016 2017 2018 2019 2020 2015 2016 2017 2018 2019 2020 — ASEAN 5 | CLMV I EU | China Japan USA Hong kong Middle East Others EU ASEAN 5 CLMV China Japan USA Middle East Others: 2020 2020 Total Exports, Custom Basis. Import, Custom Basis USD Millions Weight % YoY USD Millions Weight % YoY Total Exports, 231,468 100.0% -6.0% Total Imports, 206,992 100.0% -12.4% Electronic machines 36,514 15.8% 2.6% Machinery and parts 18,118 8.8% -13.4% Electrical equipment 23,561 10.2% -2.7% Crude oil 16,955 8.2% -20.0% Motor cars, motor vehicles, parts and accessories 21,267 9.2% -22.2% Electrical machinery and parts 16,789 8.1% -4.4% Precious stones and jewellery 18,207 7.9% 16.0% Electrical, electronic equipment and parts thereof 16,027 7.7% 3.7% Chemicals 14,457 7.0% -5.5% Polymers of ethylene in primary forms 7,972 3.4% -13.1% Iron, steel and products 10.234 4.9% -20.8% Chemical products 6,736 2.9% -11.2% Parts and accessories of vehicles 9,012 4.4% -21.7% Machinery and parts thereof 6,528 2.8% -11.0% Computers, parts and accessories 8,576 4.1% 4.7% Textiles Refine fuels Iron and steel and their products Source: Ministry of Commerce 5,749 2.5% -16.8% Other metal ores, metal waste scrap, and 8,096 3.9% -9.4% 5,355 2.3% -26.9% products 4,859 2.1% -12.5% Jewellery including silver bars and gold 7,493 3.6% -32.1% บริการทุกระดับประทับใจ K KASIKORNTHAI Export and Import Growth by Key Destinations Export growth by key destinations 2017 ■ 2018 2019 2020 5M2021 ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Import growth by key destinations ■2017 ■2018 2019 ■2020 ■5M21 35% 30% 22.00% 21.57% 25% 16.90% 20% 15% 9.21% 10.78% 10% 5% 0.02% 0.76% 0% do -5% -10% 18.65% 8.62% 7.90% L 21.52% 21.52% -15% -20% -25% -30% -27.53% ASEAN-5 CLMV EU China Japan USA Total ASEAN-5 CLMV EU China Japan USA Exports Total Imports 2020 5M2021 2020 5M2021 Exports Value Value Value Value Share Share Imports (Million USD) (Million USD) (Million USD) Share (Million USD) Share ASEAN-5 31,045 13.41% 14,318 13.18% ASEAN-5 26,815 13.0% 13,151 12.3% CLMV 24,410 10.5% 10,434 9.60% CLMV 12,373 6.0% 9,357 8.7% EU 20,706 8.9% 10,459 9.63% EU 17,280 8.3% 7,993 7.5% China 12.9% 29,813 14,918 10.59% China 49,801 24.1% 25,947 23.2% Japan 9.9% 10.0% 22,808 10,396 Japan 27,687 13.4% 14,523 14.1% 14.9% 13.6% USA 34,381 15,920 USA Total 231,468 100.00% 108,635 100.00% Total 14,808 206,156 7.2% 100.00% 5.7% 5,897 107,141 100.00% Source: Ministry of Commerce บริการทุกระดับประทับใจ 149 150#76K ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KASIKORNTHAI Challenges: Exports Export is expected to mediocre in 2021 amid global trade uncertainties and transitions to structural changes Short-term Challenges Key Structural Problems Key Affected Products Short-term Measures from Authorities and Related Parties Long-term Measures from Authorities and Related Parties ■Faltering global demand ■THB volatility Exports ■■US trade policy, e.g. measures to reduce trade deficit from 16 major countries ■Trade uncertainties ■High dependence on China's market ■Changing demand in electronic products and loss of competitiveness in some areas (e.g. HDD) High crop surplus among competitors ■Electronics and Electrical Appliances (Structural Challenge) ■Fishery and Agriculture Products (US SIMP) ■Steel and Aluminum, Washing machine (US tariffs) ■Plastic, ICs, Machinery and Electrical Equipment (US-China's trade dispute) ■ Extending products to catch up with changing consumer trends ■ Enhancing practices to comply with international standards ■Setting up export promotion board ■ Providing supports to help individuals gain skills and qualifications relevant to the needs of the labour market ■Negotiating FTA and regional trade agreements ■Relocating factories to GSP eligible countries ■Promoting BOI's privileges which grant merit based on competitiveness enhancements ■ Enhancing productivity Note: HDD Hard Disk Drive; IUU fishing = Illegal Unreported and Unregulated fishing; FTA = Free Trade Area; GSP = Generalized System of Preferences; BOI = the Board of Investment of Thailand Source: KResearch (as of April 2019) บริการทุกระดับประทับใจ 151 K ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KASIKORNTHAI Tourism industry in Thailand expected to take over 3 years to recover to near pre-COVID-19 level %Tourism Revenue to GDP (%) 20% 18.2% 17.9% 11.6% 11.4% 10% 5.2% 6.5% 3.0% 1.6% -2.3% 1.5% -2.0% 6.6% 0% 2.2% 2018 2019 2020 %Foreign tourism revenue to GDP %Total toursim revenue to GDP 0.1% -0.3% 2021 %Domestic tourism revenue to GDP No. of Foreign Tourists and Domestic Trips • • The Thai government's 120-day target of reopening the country to international tourists (around the start of 4Q21) will help revive business activity in the tourism sector. Nevertheless, success rests on nationwide vaccination efforts and containment of COVID-19 outbreaks, both domestic and overseas. However, tourism continues to be rife with uncertainty. KResearch has thus revised downward the upper end of its projection on the number of tourist arrivals in 2021 to 650,000 and the lower end of our projection is at 250,000 tourists. Domestic travel has been impacted by the latest wave of the COVID-19 pandemic and it may take a while for the situation to be controlled. KResearch has thus revised downward the number of domestic travelers during 2021 from previous estimates. Domestic travel is now anticipated at 60-70 million trips, compared to the 85-109 million trips projected in April 2021. Tourism Revenue (Bt bn) (Million Persons) 166.0 172.7 (Million Trips) 180 4,000 2,947 2,994 50 130 39.9 86.3 3,000 38.2 60-70 80 1,876 1,912 2,000 25 30 1,071 1,082 269-363 6.7 0.25 -0.65 1,000 813 339 474 0 -20 250-318 19-45 2018 2019 2020 2021 0 No. of Foreign tourists (persons) Note: As of May 2021, KReseach estimates tourism data for 2020 to 2021 บริการทุกระดับประทับใจ No. of Domestic trips 2018 2019 ■Foreign Tourism Revenue ■Total Revenue 2020 2021 Domestic Tourism Revenue 152#77Integrated Circuits & Parts Motor Vehicles 45.7 Food Basic Metal 47.3 Rubber & Plastic Products 48.2 Chemical & Chemical Products Paper and Paper Products Textiles 37.4 Tobacco 59.6 Investment Value (Bt bn) K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Economic Condition Highlights: CAPEX and Investment Cycle Capacity Utilization by Key Industries Investment value of BOI-approved applications (Total)* 76.8 Baverages 56.3 0 20 40 60 80 100 53.2 57.7 ■2019 ■2020 75.1 2017 ■2018 5M21 2005 2006 2007 2008 2009 2010 2011 150 100 50 0 1,000 Units 250 200 146 161 Demand Side: Transferred Properties in BMR* 178 151 159 182 174 196 197 206 197 175 163 2012 2013 1,000 Units ននននន ■New Housing Completions ■New Projects Launched 170 150 132131 133 130 108 125 117 111 114 114 119 110 102 131 124 127 81 86 115 112 90 66 101 64 109 73 70 50 30 10 -10 2014 2015 2016 2017 2018 2019 2020 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Sources: National Economic and Social Development Council (NESDC), BOT, Real Estate Information Center (REIC), Agency for Real Estate Affairs (AREA), and KResearch Note: *Including Condominium, Single House, and Townhouse; BMR = Bangkok and Metropolitan Area บริการทุกระดับประทับใจ 2018 2019 2020 5M/2020 43.9 25.5 33.4 17.6 5M20 5M21 68.6 62.5 5M/2021 2005 2001 Loans to Property Developers 2009 2013 2017 1Q21 Housing Loans ■Mortgage loans to GDP are higher than pre-crisis level, due to factors such as changes in consumer behavior, intense competition among banks, and a more accessible credit market ■ Outstanding loans granted to property developers to GDP was 4.7% in 1Q21, still lower than pre-crisis level ■Supply Side: Overall new housing projects launched in 5M21 decreased 30.8% YoY, due to large housing supply and effects of COVID-19 ■Demand Side: In 5M21, property transactions decreased 9.0% YoY, with a rise in household debt and high concern about employment security ■Mortgage NPLs among Thai commercial banks was at 3.74% in 1Q21, compared to 3.78% in 2020 K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Property Market: Overall market remains contracted; high concern about the seriousness of the COVID-19 situation Supply Side: New Housing Completions and New Projects Launched in BMR* Outstanding Mortgage Loans to Individuals and Property Developers to GDP Source: The Bank of Thailand (BOT), The Ministry of Commerce (MOC), and Office of Industrial Economics (OIE) (Data as of Jun 2021) Source: The Board of Investment of Thailand (BOI) Note: *Figures above indicate investments of approved projects requesting investment promotion benefits from BOI บริการทุกระดับประทับใจ Investment Value (Bt bn) 500 400 300 200 100 0 Agriculture Minerals&Ceramics Light Industry ■2016 2017 17.13 Metal Processing 13.33 Electronics & Electrical 17.53 207 Chemical Plastic Paper -2019 6.17 Service & Infrastructure 29.44 Technology and Innovation Investment value of BOI-approved applications (by Industry)* 1,100 867.5 (+7%) 900 631.1 700 (-27%) 500 447.4 459.5 (-13%) (-19%) 361.4 (-19%) 100.1 300 100 -100 2016 2017 2018 2019 2020 1Q21 0.22 2020 1Q21 153 % of GDP 30 25 20 16.8 15 10.4 10 5 0 1993 1997 27.1 4.7 154#78k KASIKORNTHAI Household Borrowing Household Borrowing to GDP ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Old Definition New Definition % NPL for Consumption Loans of Thai Commercial Banks % of Loans 25 % of GDP 19.39 100 89.4 90.5 79.7 79.4 78.4 79.8 71.8 80 59.3 8.8 7.5 7.1 60 12.0 12.7 10.6 23.1 23.1 40 28.9 7.6 8.3 12.3 12.2 22.3 22.3 9.4 9.4 13.4 13.6 25.2 25.6 GOGN 20 15 10 5 2.92 22.3 24.4 19.6 18.9 0 20 L7.7 11.2 15.1 24.5 29.5 33.5 33.7 33.5 38.3 34.3 38.8 2001 2005 2009 2013 2017 1Q21 11.9 13.2 13.9 0 1994 1996 1997 2010 Commercial Banks Non-Bank Fls 2012 2014 2016 SFIs Others 2018 2019 2020 1Q21 Saving Cooperatives --Total Old Definition: Data from 1991 - 1997: lending from commercial banks and SFIs to individual persons for consumption only New Definition: Data from 2010 onwards: takes into account individual persons' outstanding loans from all types of financial institutions, including savings Co-ops and non-banks Cross-Country Comparison of Household Debt (as of 2020) % of GDP 160 129.2 120 80 40 0 103.8 93.3 Debt Service Ratio of Thai households % 40 27.9 28.1 29.1 28.4 27.2 27.0 30 89.3 69.5 67.9 62.2 20 Australia South Korea Malaysia* Thailand U.S. Singapore China Source: CEIC and KResearch 10 0 2009 2011 2013 2015 2017 2019 Source: NSO and KResearch ■Household debt to GDP edged up to 90.5% in 1Q21, and is expected to rise further in 2021 ■Household borrowing to GDP is higher than pre-crisis level, due to factors such as changes in consumer behavior, intense competition among banks, and a more accessible credit market ■Thailand's household debt to GDP is comparable to other countries*; debt service ratio of Thai households is still well below 40%, indicating the household debt situation is unlikely to trigger any problems in the foreseeable future ■NPL ratio for consumption loans of commercial banks rose to 2.92% in 1Q21 from 2.85% in 4Q20 Source: BOT, Bank for International Settlements (BIS), National Statistical Office (NSO), CEIC and KResearch บริการทุกระดับประทับใจ 155 K ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK KASIKORNTHAI BOT Macro Prudential Policy ■New frameworks on retail lending announced by BOT to closely monitor systematic risk and implement preventive actions LTV Criteria for Mortgage Loans (Effective: January 20, 2020) New (Including Top-up loans) Criteria for Credit Card / Personal Loans (Effective: September 1, 2017) Credit Cards Price and Type of Properties 1st Contract NEW LTV Limit OLD (Apr-19) LTV Threshold 2nd Contract 3rd Contract Onwards Lending Criteria New Min.Monthly Income Bt15,000 Old Bt15,000 Personal Loans New Old House ≤ 100%* < Bt10mn Condo. ≤ 100%* ≤ 95% ≤ 90% LTV Limit 80-90% 80-90% LTV Limit 70% 70% Credit Line (times of average monthly income) Income Credit Line Credit Line <Bt30,000 ≤1.5 times Income < Bt30,000 < Bt50,000 ≤3 times ≤ 5 times Credit Line ≤ 1.5 times <3 institutions Credit Line ≤ 5 times > Bt10mn House & Condo. ≤ 90% 80% (LTV Limit) 80% 70% >Bt30,000 ≤ 5 times 1) Under the new framework, LTV limit will be capped at 100% for the first contract of housing loans, and * loans for furniture and decorations can be added up to 10% of collaterals (old - no these conditions) 2) For the second contact, LTV limit is 80% if the first contract's installment payments are less than two years (old - three years); otherwise, LTV limit is 90% 3) Risk weight is 35% if LTV does not exceed its LTV limit; while the risk weight will increase to 75% for the loans for furniture and decorations of the first contract Notes: > Bt50,000 ≤ 5 times For credit card loans, credit line will be raised to 2 times for customers who have monthly income below 30,000 Baht per month, effective until December 2021. Criteria for Car Loans ■ Auto Registration Loans (Effective: February 1, 2019): Auto registration loan providers to be approved by Bank of Thailand and Ministry of Finance Regulated by Fiscal Policy Office Picofinance* Regulated by the BOT August 15, 2019: BOT relaxed the LTV rules for co-signers that have no ownership interest in the home being purchased April 2019: BOT tightened LTV criteria for mortgage loans, and raised down payment for the second contract onwards. Year 2009: BOT announced revised criteria in 2009-2010 on mortgage loan risk weights with a different effective date Year 2008: Risk weights for mortgage loans dropped from 50% to 35% under Basel II Credit Line Pico Plus* Capital Fund Interest Rate Ceiling > Bt5mn Bt50,000 ≤ 36% > Bt10 mn < Bt100,00 <36% for first Bt50,000 > Bt50 mn Depends on debt-servicing ability <28% for the amount in excess of Bt50,000 ≤24% <24% Note: * Picofinance and Pico Plus are allowed to provide loans only in the registered province บริการทุกระดับประทับใจ 156#79K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Thailand's external balances remain relatively strong compared to peers High international reserve / Imports (Import Coverage) Low foreign holding ratio in Thai government bonds Months of Imports 1208642 3070 26.0% 25% 22.9% 12.3 12.1 10.8 11.1 20% 9.5 9.0 8.7 14.6% 15% 10% 3 months5% 0% lil. 14.0% Indonesia South Korea Malaysia 2.3% Philippines Thailand India Indonesia Philippines Korea Malaysia Thailand Singapore Source: CEIC, KResearch (data as of March 2021) High international reserve ratio / External debts 140% 120% 94% 96% 126% 100% 100% 77% 80% 60% 41% 40% 31% 23% 20% 0% India Indonesia Philippines Korea Malaysia Thailand Singapore Note: Retrieved from Asia Bond Online, based on latest available datal Source: Asian Development Bank 0.8% Vietnam ■Thailand's economy and financial markets are able to withstand impacts from fluctuations in global liquidity due to: ■High import coverage (international reserves/monthly imports) compared with the IMF's three month import coverage guideline ■More than 100% of external debt covered by international reserves ■Low portion of foreign holdings in Thai government bonds compared with other countries Source: CEIC, KResearch (data as of March 2021), Retrieved on July 2021 บริการทุกระดับประทับใจ K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Monetary and fiscal expansion raises financial stability concerns In consistent with the Fed, the BOT cut interest rate to support the economy amid COVID-19 outbreak Thailand has enough FX reserves to meet all internal and external obligations Percent 3.0 2.5 20 2.0 1.5 Federal Funds Target Rate - Upper Bound Federal Funds Target Rate - Lower Bound BOT Policy Rate 1.0 0.5 0.0 Jan 15 Apr 15 Jul 15 Oct 15 Jan 16 Apr 161 Jul 16 Oct 16 Jan 17 Apr 17 Jul 17 Oct 17 Jan 1871 Apr 18 Jul 18 Oct 18 Jan 19 Apr 19 Jul 19 Oct 19 Jan 20 Apr 20 חו קח ■Due to a deteriorating economy, the Fed decided to cut its policy rate by 1.50% in 2020 to 0.00-0.25% ■Monetary easing leads to a massive exodus of capital from emerging markets and worsens exchange rate depreciation. However, Thailand's external stability will likely be maintained ■The Thai banking system excess liquidity fell slightly. The CAR was good (20.1% as of 4Q20) and NPL ratio was still manageable (3.1% as of 4Q20), with net profits of Bt146.2bn in 2020 3 months of imports $ Billion 300 $ Billion ■FX Reserves 300 Reserves backing banknotes ■ST external debt ■Net Forward Position 250 250 200 200 280.2 56.3 150 150 $312.9 Billion $193.41 Billion 100 100 65.0 50 50 72.2 32.7 0 0 Source: BOT, KResearch. Last Update: July 22, 2021 Excess liquid assets in Thai commercial banks slightly rose Million Baht 5,000,000 %LCR 194 200 183 185 185 190 4,000,000 177 178 174 180 3,000,000 170 2,000,000 160 2016 2017 2018 2019 2020 Liquid Assets. 1Q21 May-21 LCR (%) Note: BOT has imposed the Liquidity Coverage Ratio (LCR) Framework which replaces the maintenance 6% reserve requirement. Regarding the LCR framework, all banks shall maintain high-quality liquid assets not less than net expected cash outflow over the next 30 days. The LCR was implemented on January 1, 2016, with the minimum requirement set at 60%, rising in equal annual steps of 10 percentage points to reach 100% on January 1, 2020 บริการทุกระดับประทับใจ 158 157#80Billion Baht K KASIKORNTHAI Other Figures Thai Bond Market Size (Gov't and Private bonds) 16,000 88% 88% 100% % 14,000 12,000 63% 64% 65% 69% 70% 71% 74% 76% 79% 78% 79% 90% 80% 57% 56% 70% 10,000 60% 8,000 50% 6,000 40% % to GDP 30% 4,000 2,000 0 20% 10% 0% 100 23322IIOO 50505050 3.5 3.0 ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Bond Yields 2.5 2.0 2.12 1.51 1.64 1.5 1.35 145 1.0 0.46 0.48 0.51 0.57 0.67 0.02 0.5 0.0 6M 1Y 2Y -*-Dec 18 Dec 19 3Y 4Y 5Y 6Y 7Y 8Y 9Y 10Y 15Y -Dec 20 -Jul 20,2021 Current Account and FX Reserve 1200 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 1H21 Thai Bond Outstanding (LHS) --Bond Market Size to GDP (RHS) Foreign Holdings of Thai Bonds Billion Baht 1000 800 600 400 1% 2% 200 94 0 % of Total Bond Outstanding 8% 8% 8% 8% 7% 7% 6% 7% 6% 6% 6% 4% וווווווו ៩៩៩៩៩៖៖៖៖៖ 8% 7% 6% 5% 4% 3% 2% 932 918 925 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 1H21 1% 0% Foreign Holding Outstanding (LHS) ―% of Thai Bond Market (RHS) USD Billion 50,000 40,000 30,000 20,000 10,000 0 -10,000 -20,000 1993 1995 1997 1999 2001 2003 บริการทุกระดับประทับใจ 2005 2007 Current Account (LHS) K KASIKORNTHAI Other Figures Million Baht 5,000,000 4,000,000 3,000,000 2,000,000 17.7 17.4 18.0 18.3 19.4 1,000,000 0 Housing Loans / GDP % to GDP 400,000 26.6 27.1 30 200,000 21.0 22.0 22.3 22.3 22.6 23.2 25 20 20 0 1.709,897 1,885,139 2,034,137 2,263,552 2,510,012 2,783,129 3,021,811 3,251,488 3,448,852 3,706,397 3,918,565 4,172,556 4,228,272 2009 2012 2015 2018 Housing Loans for Personal Consumption (LHS) --% Housing Loans to GDP (RHS) 15 10 USD247bn (Jun21) 300,000 250,000 200,000 150,000 100,000 50,000 USD-7bn (May21) 0 2009 2011 2013 FX Reserves (RHS) 2015 2017 2019 1H21 Million Baht 600,000 ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Credit Card Loans/GDP 2.0 2.0 2.0 2.1 2.2 2.4 2.4 2.5 2.5 2.6 196,59 216,427 228,903 261,553 290,425 318,141 333,493 360,096 394,123 % to GDP 3.5 2.9 2.7 2.7 3.0 418,747 457,090 449,733 417,926 2.5 O5 332211σ o 2.0 1.5 1.0 0.5 0.0 2009 2012 2015 2018 1Q21 Credit Card Loan Outstanding (LHS) Credit Card Loan to GDP (RHS) Note 1) Credit card loans represent outstanding credit card loans from commercial banks and non-banks, excluding SFIs, saving cooperatives and others financial Institutions Million Baht 0 800,000 1Q21 Note Housing loans represent outstanding housing loans for personal consumption granted to individuals of householders by financial institutions (including Commercial banks, Finance companies, Credit financiers, SFIs, and Insurance companies but excluding Saving Cooperatives and others financial Institution) Source: BOT, NESDC 600,000 2.2 400,000 200,000 Personal Loans/GDP % to GDP 3.7 3.7 4.0 3.4 3.5 1.7 1.9 2.1 2.3 2.4 2.3 2.3 2.3 2.3 3.0 2.5 2.0 1.5 213,74 187,4 257,129 299,139 312,851 318,354 332,996 354,243 383,303 579,911 580,383 578,883 1.0 0.5 0.0 2017 2019 1Q21 ▬▬▬▬▬▬% Personal Loans to GDP (RHS) 0 2009 2011 2013 Personal Loan Outstanding (LHS) 2015 Note: 1) Personal Loans represent outstanding personal loans under supervision (including commercial banks and non-banks, excluding SFIs, saving cooperatives and others financial Institution) บริการทุกระดับประทับใจ 160 159 USD Billion#81K KASIKORNTHAI Other Figures Loans to GDP as of 2020 United States Thailand South Korea Japan Malaysia Singapore China ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Thai Banks' Net Loan Growth and NPL Ratio % YoY 67.1 90.5 98.4 100.4 % to Total Loans 12 129.4 52963 15 5.23 6 3.89 5 2.94 2.44 2.31 2.31 2.69 2.99 3.08 3.09 3.14 3.25 3.244 3 2 12.5 15.1 14.0 10.5 4.2 3.4 1.3 4.3 5.2 1.9 6.1 4.3 144.7 % of GDP 0 1 -3 170.0 -0.5 2009 0 2011 2013 2015 2017 2019 1Q21 3 53 73 93 ;3 433 453 473 T 493 4;3 % YoY Net Loan Growth % Gross NPL Ratio Note: Data on China, Korea and Japan include loans from commercial banks as well as financial institutions, the rest include loans only from commercial banks Credit Card Statistics Note: % YoY Net loans represent growth of net loans in 14 Thai commercial banks from C.B.1.1 Latest % Gross NPL is as of 2Q20 GDP Per Capita % YoY Baht 25 19.9 250,000 11.3 -10 -15 GSGOGOGN 12.8 15 11.1 9.7 10.2 200,000 8.7 6.7 7.2 6.0 5.6 -1.1 5 150,000 5.8 14.3 11.0 9.5 4.8 8.0 9.4 6.2 9.2 8.6 0 -1.6 -5 100,000 Credit Card Loan Growth Spending Growth 11.3 50,000 147,364 4.0 8.6 3.9 1.8 3.2 5.7 5.4 5.2 2.9 % YoY 20 -7.30 163,956 170,467 185,159 192,327 195,807 202,151 213,586 225,095 236,861 243,787 225,914 I 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 5M21 Note: The credit card statistics number includes foreign bank and non-bank credit cards Source: BOT, NESDC, NSO, CEIC Data, and KResearch 0 2009 บริการทุกระดับประทับใจ K KASIKORNTHAI Other Figures Population and Labor force 2012 GDP Per Capita -10 -20 22 123 -30 2015 2018 2020 % YoY ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK Unemployment Rate 0.68 0.66 0.72 0.84 0.88 0.99 Million Person % of Labor Force 60 54.0 55.2 54.5 55.0 54.8 55.6 56.0 56.3 56.6 56.8 57.0 2.50 50 2.00 40 1.50 1.50 30 1.04 20 1.00 10 0.50 0 0.00 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 1Q21 ■Population (Age>= 15 years) Foreign Direct Investment Labour Force 2009 2012 1.18 1.05 0.98 2015 2018 1.96 1.69 1Q21 Foreign Direct Investment Position by Countries % Trillion Baht 100% 22.1 22.2 21.8 22.9 23.8 24.7 24.3 25.1 25.1 25.4 10 25 80% 15.2 15.5 13.9 20 9.6 8.2 7.9 8.1 7.5 6.6 6.8 6.7 6.3 6.3 8 7.5 6 28 11.7 8.9 -1.3 9.4 15 60% 3.9 10 31.7 34.6 35.0 35.1 36.3 35.2 36.2 34.3 33.1 33.6 5 -1.6 40% 4 0 -5 20% 2 4.9 5.6 5.8 6.6 6.5 7.0 7.9 7.7 8.5 8.8 8.7 -10 18.2 17.1 1.4- 1.9 1.6 1.7 2.3 2.0 17.0 16.1 16.0 16.0 14.8 14.0 17.6 16.3 16.1 2.3 28 14.8 13.4 16.7 15.5 17.8 2.7 2.8 12.6 12.5 20.2 19.4 0 -15 0% 2011 2012 2013 161 Note: 2014 2015 2016 2017 2018 2019 2020 1Q21 FDI Position (LHS) ―% YoY (RHS) 2012 2013 2014 2015 2016 2017 2018 2019 2020 1Q21 ■ASEAN ■EU ■China ■Japan ■ US Others - FDI refers to equity investment, lending to affiliates, and reinvested earnings; investment in equity is treated as a direct investment when the direct investors own 10% or more of ordinary shares - FDI position by countries is an investment outstanding that nonresident investors have with resident enterprises as stock concept - Converted FDI US Dollar to Thai Baht by reference rate from the Bank of Thailand Source: BOT, NESDC, NSO, and KResearch บริการทุกระดับประทับใจ 162#82K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK For Further Enquiries, Contact KASIKORNBANK Investor Relations: Chief Investor Relations Officer Investor Relations Team Tel (66) 2470 2673 to 4 Tel (66) 2470 6900 to 1 IR Website Tel (66) 2470 2660 to 1 Email: [email protected] www.kasikornbank.com → Investor Relations Disclosure Practice: ■Unreviewed/unaudited quarterly financial reports are released within 21 days from the end of each period ■Reviewed financial reports are released within 45 days from the end of the period for 1Q and 3Q; Audited financial reports are released within 2 months from the end of the period for 2Q and 4Q ■Following KASIKORNBANK's Disclosure Policy and good governance practice, KBank maintains a "silent period" for 7 days prior to the unreviewed/unaudited earnings announcement. During this period, the Bank refrains from replying to questions or commenting on the earnings announcement and arranging one-on-one or group meetings with analysts and investors บริการทุกระดับประทับใจ 163 K KASIKORNTHAI DISCLAIMER: Bank of Sustainability IC+ ธนาคารกสิกรไทย 开泰银行 KASIKORN BANK This document is intended to provide material information relating to investments or products in discussion and as a reference during the discussion, presentation, or seminar only. It does not represent or constitute any advice, offer, contract, recommendation, or solicitation and should not be relied upon as such. In preparation of this document, KASIKORNBANK PUBLIC COMPANY LIMITED ("KBank") has made several crucial assumptions and relied on financial and other information available from public sources as of the date of this document. Therefore, KBank assumes no responsibility or liability and makes no representations or warrants with respect to the accuracy and/or completeness of the information described herein. Before making their own independent decision to make any investment or enter into any transaction, the recipient of this information ("Recipient") shall carefully review information relating to services or products of KBank, including but not limited to economic and market situations and other factors pertaining to the transaction as posted on KBank's website at URL www.kasikornbank.com and in other sources, and make their own investigation on all other information, documents prepared by other institutions, as well as consult with Recipients' financial, legal, or tax advisors on each decision. The Recipient understands and acknowledges that the investment or execution of the transaction may be a transaction with low liquidity and KBank shall assume no liability for any loss, damage, or expense of any nature incurred by the Recipient arising out of such investment or execution of the transaction. The Recipient also understands and acknowledges that the information so provided by KBank does not represent the expected yield or consideration to be received by the Recipient arising out of the investment or the execution of the transaction. Further, the Recipient should be aware that the transaction can be highly risky as markets are unpredictable and uncertain, and there may be inadequate regulations and safeguards available to the Recipient. KBank reserves the right to amend, either in whole or in part, the information so provided herein at any time as it deems fit, and the Recipient acknowledges and agrees with such amendments, accordingly. For any inquiry, or in the case of making a complaint, the Recipient may seek further information from KBank at [email protected], +(662) 470 6900 to 01, +(662) 470 2660 to 61, or +(662) 470 2673 to 74. * The information herewith represents data in the Bank's consolidated financial statements, some of the numbers and ratios are calculated before netting with KBank's non-controlling interest. บริการทุกระดับประทับใจ 164#83K KASIKORNTHAI ธนาคารกสิกรไทย 开泰银行 KASIKORNBANK With concern and care from KBank, let's protect ourselves from COVID-19 Wearing hygienic mask Clean your hands with alcohol-based gel Keep away from each other at least 1 meter บริการทุกระดับประทับใจ K KASIKORNTHAI บริการทุกระดับประทับใจ 165