#1tub ทีเอ็มบีธนชาต TMBThanachart Investor Presentation 2Q21/1H21 Financial Performance t Analyst Meeting July 21, 2021#2Integration Update Relief Program Update 2Q21/1H21 Performance & Asset Quality tub 2#3Executive summary - Successful EBT tub Thailand kicked start 2Q21 with the resurgence of Covid-19 epidemic that put even more pressure on business environment throughout the quarter. Nonetheless, with a well-executed integration roadmap, a clear strategic direction to preserve balance sheet quality for future growth and most importantly our TTB people, 2Q21 top priorities were delivered as plan. Successful EBT: Fully integrated as one bank under the name TMBThanachart Bank (TTB) ■ The successful EBT mission in 18-month timeline on 5th July 2021 reflects the readiness and strength of our organization as well as our harmonized teamwork. Short-term and quick-win synergies were realized as plan especially from Balance Sheet Synergy and Cost Synergy. With a unique position built by the complimentary strengths of the 2 Banks, next step is to capture short and medium term synergy value post-EBT. 3#4Successful entire business transfer (EBT) at a glance TMB ธนาคารธนชาต Thanachart Bank 2 separate legal entities under one governance Customers 100% loans transferred or THB ~620bn from TBANK 18-month integration journey Channel 664 branches operated under one bank, one system tub 1 legal entity tub System and Operation ~8k FTES transferred from TBANK 100% deposits transferred or THB ~470bn from TBANK 371k of T-Connect users activated Touch in 1st week after EBT ~290 applications reduced from over 600 applications 4#5Balance sheet synergy realization already in place Deposits mix Cost of deposits (excl. FIDF) tub 1,398 bn TD+NCD 419 bn Hybrid 1,324 bn 144 bn (11%) (30%) 538 bn (38%) 702 bn (53%) CASA 441 bn (32%) 2019 478 bn (36%) 2Q21 High-cost TD+NCD deposit has been replaced with lower cost hybrid & CASA funding 1.06% 50 bps COD drop at ttb vs. industry's drop of 38 bps 0.56% 0.53% 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 ☐ Balance sheet optimization strategy has resulted in a sharp decline of TTB's COD by 53 bps (from 1Q20 to 2Q21) 5#6Better-than-plan cost synergy realization Cost synergy drivers Branch # branch -230 Cost synergy realization to-date THB bn Utb ☑ 894 664 Accelerated branch rationalization thru the launch of co-location format before EBT New cost saving 1.8 from action done in 2021 2019 2Q21 3.2 3.0 '000 FTEs HR -3.7k Smaller branch -0.9 footprint, process -1.5 Integration cost & write-off (one-time) automation and Recurring cost saving from actions in prior periods THB 5.6 bn accumulated net cost synergy Vs. ~10-12 bn 5-year synergy value (shared to investors on 24 Jan 2020) 19.4 15.7 economy of scale let to lower no. of headcounts 2020 1H21 2019 2Q21 THB bn Marketing -1.6x 2019 2Q21 Cost saving from less marketing in duplicated products e.g., TBANK'S Ultra saving vs. TMB's No Fixed Accumulated net cost synergy since the merger value at THB 5.6 bn, well over the initial target as recurring cost savings (e.g., HR and branch rationalization) came early since 2020. Cost savings from synergies has well covered one-time integration and written-off expenses. 6#7Post-EBT focus on delivering revenue synergy via flagship products Ub's flagship ttb all free E VISA Utb ttb TMB reserve ABSOLUTE VISA VISA ttb smart port DRIVE ttb All Free & No Fixed ttb credit card - ttb Drive Cash your car Debt consolidation program via CYC for unsecured loan customers to promote healthy borrowing New "Reserved" card customers can enjoy "earn fast" from spending with ability to "burn smart" with our products Transactions via ALL Free/Touch will earn WoW point, which can be used to redeem many privileges DRIVE Reward when showing good repayment behavior ttb reserve VISA ttb all free Utb VISA Earn fast X2 Hospital/ online shopping. x10 Life insurance ttb Burn smart smart THB 1,200 credit when port purchase 100K fund (10K points redemption) Reward regular digital user (e.g., bill payment) WWW + K + WN1% Cash back ווו ווו + for online shopping 7#8Leveraging Strength from Group Structure Group Structure Post-EBT tub ทีเอ็มบีธนชาต TMBThanachart Subsidiary Companies Associated Companies 100% 49% Phahonyothin Asset Management (PAMCO) Thanachart Fund Eastspring (TFUND) 100% Thanachart Broker (TBROKE) 35% TMBAM Eastspring (TMBAM) tub • • The current TTB's group structure is well-balanced and reflects our strategic direction of gearing toward retail banking space. While TBROKE, TMBAM Eastspring and TFUND are support businesses to the good bank side, PAMCO has an important role in managing distressed assets for the bad bank area. Under the prolonged Covid-19 situation and weakening economy, TTB will continue to leverage our core strengths to seek for opportunities to sustain shareholder returns. In our pipeline, we have initiatives both at the Bank level and group level to improve margin as well as to preserve asset values from the deterioration of asset quality across banking industry. • As bad asset management has become increasingly important and activities in this market are growing, PAMCO has planned to issue debentures to support TTB's NPL strategy as well as to capture future business potentials in this area. • The benefit of low cost funding at a subsidiary level will pass on to TTB's consolidated picture and help improve funding strategy as a whole. • PAMCO's bond is expected to be issued in 3Q21. 8#9Integration Update Relief Program Update 2Q21/1H21 Performance & Asset Quality tub 9#10Executive summary - Preserve B/S quality for future growth tub 2Q21 Performance: Focusing on funding optimization and cost discipline against revenue pressure. Asset quality in line with target. ☐ NII and NIM was fairly stabilized QoQ as funding optimization helped reduce pressure from a slowdown in asset growth and yields. Expecting economic headwinds, our intention is to selectively grow loans to preserve B/S quality and to mitigate risk on NII recognition by adjusting accounting estimates to be more conservative. Non-NII was weighted down by Covid-19 situation and partly by our quality growth strategy. Despite short-term hiccup, we continue to develop our fee-base product and service with an aim to build recurring fee income for the long run. C/I ratio stayed within target as we have been consistent with cost discipline. In 2H21, there will be remaining EBT expenses such as rebranding & marketing activities which were postponed due to Covid-19 and subrogation right expenses. In addition, the Bank has set additional HR expenses related to Covid-19 medical care and health measures such as vaccination, social distancing measures at branches and operation sites and hospitel for our employees. Therefore, C/I ratio is expected to accelerate in the following quarters but still in guidance. ■ Asset quality remained in line with guidance. TTB has emphasized on prudent portfolio management with continued effort to reduce stage 2 and 3 outstanding. We also make sure the ECL model can capture true risk of customers especially those in debt relief program in order to set aside sufficient and rational ECL. 10#11Debt relief profile as % of total loan portfolio THB billion Loans under Relief Program to Total Loans • 1,382 1,380 1,359 ~40% Jun-20 Full lockdown ~1% ~13% ~14% ~14% Mar-21 Jun-21 Partial lockdown Partial lockdown Non-Debt Relief (Included Debt Relief Exit) Debt Relief: Phase 1 Debt Relief: Phase 2 (additional requests with sequential offering) Note: Loans to customers excluded interbank loans tub • • • • • Under prolonged Covid-19 situation, TTB continues to support our customers in need as it is one of our priorities. As expected, after the 3rd wave of Covid-19 resurgence at the beginning of Apr-21 which followed by lifted restriction measures, the Bank started to see requests for financial assistance from customers. Majority was from HP and mortgage. The Bank also saw an outflow from the remaining loans under debt relief phase 1 which expired and exited the program in 2Q21. As a result, the % of debt relief of total loans as of Jun-21 was at approximately 14% stable QoQ, given that total loans has been slowed due to our quality growth strategy. TTB has used our Guiding Principle of Post Relief Risk Schemes to evaluate customers' behavior and risk profile. From what we observed, around 85% of customers in the current relief program asked for light modified terms (SC1-SC3), meaning they are able to service their debts with full interest payment. Nonetheless, as rising Covid-19 cases led to further restrictions and a partial lockdown, TTB will closely monitor the situation to ensure portfolio quality and prudent risk management. 11#12Principle-based relief schemes and deterioration of asset quality captured by the ECL model Guiding Principle of Post Relief Risk Schemes tub Repayment Schedule Scheme Interest Principal Minimum Stage Minimum PD Level SC 1 Full Full 1 Normal SC 2 Full Partial 1 SC 3 Full Postponed 1 SC 4 Partial Postponed 1 SC 5 Additional skip payment ≤ 6 months 2 SC 6 Additional skip payment ≥ 6-12 months 2 SC 7 Additional skip payment ≥ 12 months 3 . The Bank has provided relief measures to affected customers, ranging from scheme 1-7 (SC1-SC7), based on customer's debt service ability The Bank uses BOT approved and externally validated ECL models consistently throughout 2021, with parameters and behavior assumptions which drive PD and LGD and immediately pick up on any portfolio deteriorations also via SICR method. On LGD of auto portfolio, we looked back to 2 crisis cycles, the financial crisis and first car sales crisis, to pick up the worst LGD. On top of that we applied a Covid-19 factor. The model picks up days past due within stages and imposes bucket and corresponding PD shifts. On top of that, we flag customers that selected one of the 7 schemes to reflect real risk level and assign elevated PDs in accordance with the severity of the program. Therefore, by continuously updating the actual customer scheme and stage from the real flow, ECL generates provision requirements that reflect the Covid-19 impact, reducing the necessity to maintain management overlay (MO). Nevertheless, we set additional MO for the unpaid accrued interest in SC5-6, on top of using 100% LGD and respective customers' PD for all schemes. 100% In addition, looking forward and taking into account the 2nd Covid-19, MO has been set aside based on industry/customers' specific needs. Note: For SC 2-4, loan staging could be classified as stage 1 or 2 depending on customer's pre-Covid-19 status (no up-staging took place), to reflect real risk level 12#13Debt relief profile by customer segments and key products tub Commercial Loans Non-Debt Relief (Included Debt Relief Exit) Loans under Relief Program THB billion 601 603 Corporate Small Enterprise • 585 505 506 489 !|| ~38% 96 97 96 -26% ~19% ~16% -99% Jun-20 Mar-21 Jun-21 Jun-20 -8% Mar-21 ~9% Jun-21 -75% -53% Jun-20 Mar-21 Jun-21 THB billion 779 Retail Loans 776 774 !|| ~45% -10% -13% Mar-21 Jun-21 Hire Purchase Mortgage 408 404 400 300 303 305 -50% Jun-20 ~9% Mar-21 ~12% Jun-21 Jun-20 Note: Loans to customers excluded interbank loans / Unsecured Credit card and personal loans • • As of Jun-21, 16% of commercial loans remained in debt relief program, lower QoQ due to an exit of loans under debt relief phase 1. For retail segment, loans under relief program rose slightly to 13%, mainly from HP and Mortgage customers as a result of Covid-19 epidemic in the second quarter. Following the special loans and asset warehousing measures, the BoT recently announced the extension of relief measures to the end of this year for retail customers. Unsecured 60 59 57 ~40% ~14% ~16% ~20% -3% -4% Jun-20 Mar-21 Jun-21 Jun-20 Mar-21 Jun-21 13#14Covid-19 readiness: Call center and non-voice capacity expansion to support incoming relief requests Incoming requests from impacted customers tub ~80k call a month during peak period 1st wave (Full lockdown) ~300k call a month during peak period and dropped 2nd wave ~56k call a month during peak period after partial lockdown, and closely monitor after full lockdown in July 3rd wave (Partial lockdown) (Partial lockdown) by ~70% after peak Mar 2020 Apr May Jun Jul Aug Sep Oct Nov Dec Jan 2021 Feb Mar Apr May Jun % Loan under relief program (phase 1 & 2) to total loan -40% -20% -15% ~14% ~14% 14#15Covid-19 readiness: Debt relief measure phase 3 Extended period of existing program (7 schemes) until 31 Dec 2021 BOT's 2-month skip payment program Credit card and revolving loan Personal loan / Installment loan Home loan Auto loan SME Qualification Non NPL (as of registration date) Purpose Registration period Mechanics Relief program to support employers and employee customers that business closure due to lockdown in the controlled area (10 provinces) or other impacted areas 19 July 2021 - 15 August 2021 ◉ Skip payment for 2 months Eligible to customer who had to close their businesses to comply with government's recent lockdown measures Loan tenor will be extended until interest accrued & Principle are paid ▪ Accrued interest will be moved to end of contract for installment loan Document required Proof of document from Covid-19 impact Staging Maintain current stage tub 15#16Integration Update Relief Program Update 2Q21/1H21 Performance & Asset Quality tub 16#17Operating performance Asset quality Summary of 1H21 operating performance 2021 Targets Loan Growth ≤Flat Actual 1H21 -2.5% YTD Deposit Growth <Flat -3.6% YTD NIM Non-NII /Total Asset Stable (3.0% in 2020) 0.8%-0.9% C/I Ratio 47%-49% % Stage 3 < 3.6% 3.00% (3.07%, excluded PPA impact) • • 0.8% • 46.6% (45.3%, excluded PPA impact) 2.89% Credit cost 160-180 bps 161 bps • • • tub As part of B/S optimization initiatives, TTB strategically shrink low yielding loans and high risk segment with a plan to redeploy them in higher yielding assets. However, due to Covid-19, we have been more selective on growing new loans. NII and yields would temporary be pressured but this is to ensure portfolio quality and readiness to resume growth once the situation allows. B/S optimization on the deposit side was well-executed. Post-merger deposit structure allowed TTB to run down high cost deposit and replace with our flagship transactional and hybrid products, resulting in improving cost of deposit. Funding volume was also optimized during slow loan growth environment. As a result of B/S optimization and funding strategy, 1H21 NIM was fairly stabilized at around 3% level. However, NII and NIM is expected to remain under pressure from economic and low rate environment. In addition, the Bank also made adjustment on accounting estimates to be more conservative on EIR recognition and to better reflect competition and payment behavior of customers. Recurring retail fee was impacted by lower business activities amid rising Covid-19 cases and partial lockdown. Commercial fee, on the other hand, showed an increase in Trade Finance and FX fees after export/import activities started to resume. Well-contained recurrent expenses in 1H21 reflected cost saving synergy realization which came mainly from HR area, duplicate marketing expenses and branch rationalization. C/I ratio is expected to accelerate in 2H21 due to the remaining EBT expenses together with additional HR expenses for employees' health measures during Covid-19 outbreak. The uptick in % stage 3 was mainly a combination of slow loan growth and a slowdown in NPL sales to preserve NPL sale value while stage 3 outstanding was fairly flat as we continued to de-risk weak loans (both stage 2 and 3 loans). 1H21 credit cost came at the lower bound of our guidance as in 2021 we already built up reserve (THB24.8 bn) under the expectation of prolonged Covid-19 and slow economic recovery in 2021. Current LLR ratio of 125% is sufficient and reflects our portfolio nature of retail and collateral base.#18Maintaining loan quality portfolio against a resurgence of Covid-19 Total Loan tub -1.6% QoQ -2.5% YTD 1,393 bn Others Retail Credit Card 1,380 bn 1% 1% 1,359 bn 1% Retail Personal Loan 2% 2% 20 2% 2% 29% Retail HP 29% 30% Used Car 18% New Car 68% CYC 14% CYB 0.1% Retail Mortgage 22% 22% 22% Small Enterprise 7% 7% 7% Breakdown Retail HP 400 bn Corporate 37% Dec-20 37% 36% Mar-21 Jun-21 • • . Optimizing loan mix remains the Bank's long-term strategy. However, due to challenging environment, TTB has selectively grown new loans to preserve quality of the portfolio. As a result, total loans as of Jun-21 dropped -1.6% QoQ and -2.5% YTD. ■ Commercial loans declined -3.0% QoQ and -4.5% YTD mainly from short-term government loan's repayment while trade finance regained its growth momentum as export and import sector recovered. ■ Retail loans slightly dropped -0.4% QoQ and -0.9% YTD mainly from repayment of unsecured loans and HP port but mortgage loan maintained its moderate growth. Current loan structure is well-diversified. Of total loans, 57% was retail segment, of which around 91% is collateralized loans and the rest of 43% was commercial loans. 18#19Deposit strategy and structure improving cost of deposit Total Deposit -4.3% QoQ -3.6% YTD 1,373 bn 1,384 bn TD+NCD 14% 11% 1,324 bn 11% 51% Hybrid 51% 53% Saving 29% -35% CASA 32% -38% CASA 29% -36% CASA Current % Retail deposits 6% Dec-20 76% 6% 7% Mar-21 Jun-21 76% 75% tub . Deposit decreased -4.3% QoQ and -3.6% YTD, following the Bank's balance sheet optimization and liquidity management plan. With continuous effort of B/S optimization strategy, high-cost deposit running down further while hybrid product continued to expand. Flagship products still grew; All Free +6.6% YTD and No-Fixed +9.8% YTD despite the interest rate reduction, reflecting the strong value proposition of our flagship products in the market. ■ With proactive funding strategy to grow low-cost CASA, current account increased +15.0% YTD while saving account declined -4.5% YTD especially high-cost saving. Together with the decrease in TD&NCD, it helped the Bank lower down cost of deposit efficiently. After EBT, limitations and potentials in many aspects will be unlocked and allow us to start kick-in revenue synergy by offering differentiate fee based products and services to existing deposit customers such as mutual fund and BA, creating opportunities to develop more attractive product suites and bundle to serve different segments, different life stages and ensure sustainable fee income to our shareholders. 19#20Optimizing balance sheet with healthy liquidity position Continue Optimized B/S through Liquid Asset Management Unit: THB Bn Net Liquid Asset 101% LDR 100% 95% 95% 295 Dec-20 312 Mar-21 LDR+Borrowing 103% 97% 274 Jun-21 Net Liquid Asset Definition: Cash + Interbank Asset + Investment - Interbank liab. LCR Well Above Regulatory Requirement BOT Minimum Requirement ■LCR 219% 199% • 189% 179% 183% Mar-20 Jun-20 Sep-20 Official LCR as of Jun 21 will report to BOT on Aug 21 100% Dec-20 Mar-21 % of Total Funding 63% 64% Retail Deposit is a Major Source of Funds 25% 23% ■Mar-21 ■Jun-21 Utb 2% 2% 3% 3% 4% 5% 2% 3% Retail Deposit Commercial Deposit Senior Debenture Sub-debenture Interbank Borrowing Others • • To optimize B/S, the Bank proactively manages funding cost and enhances return on liquid assets via other investments. Deposit is a major source of funds, and the Bank strategically builds retail deposit base to ensure stable deposit and less reliance on short-term wholesale funding and the Bank expected the trend to continue with deposit-led strategy and creation of a strong deposit franchise. LCR was well above the BOT minimum requirement at 100%. 20 20#21Consistent improvement in cost of deposit with a strong liquidity position Strong Liquidity Position tub 1,398 1,392 1,404 1,398 1,443 1,406 1,393 1,384 1,359 Loans -2.5% YTD 1,382 1,363 1,373 1,380 1,324 Deposit -3.6% YTD 1.51% 1.29% 1.16% -150 bn ~110 bn 0.96% 0.84% -210 bn ~160 bn ~135 bn 0.80% ~148 bn 0.76% Cost of Deposit -75 bps from Dec-19 Tir tt Tir Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 Mar-21 ~89 bn Jun-21 Net Interbank • Leading deposit franchise in retail banking helps TTB bank in managing cost of deposit in this low rate environment by ■ Proactive manage balance sheets by reducing the rate of flagship products and continue to gain deposit volume ■ Optimize balance sheet by running down high cost of deposit from merger position • ■ Positive contribution from FIDF cuts As a result, a hallmark of this deposit cost reduction continued for 6 consecutive quarters since merger, showing a proven track record in executing our priorities Note: Hybrid deposits include No-Fixed, ME and Ultra saving 21#22Stabilized NIM from ability to manage deposit cost despite declining in asset yields Utb Cost of Deposit Loan Yield Net Interest Margin (NIM) Loan yield (excluded PPA impact) 5.03% 4.72% 4.64% 5.23% 4.68% 4.88% -4 bps QoQ 1.16% -40 bps YoY 1.22% -43 bps YoY 0.80% 0.76% 0.79% 11 4.60% -8 bps QoQ -36 bps YoY 4.52% 5.08% -52 bps YoY 4.56% 2.88% 3.00% 2.98% -2 bps QoQ +10 bps YoY Flat YoY 3.00% 3.00% III || 2Q20 1Q21 2Q21 1H20 1H21 2Q20 1Q21 2Q21 1H20 1H21 2Q20 1Q21 2Q21 1H20 1H21 Balance sheet optimization resulted in lower interest expense for TTB plus deposit repricing strategy on No-Fixed, Ultra Saving and ME Save, therefore, cost of deposit reduced by -4 bps QoQ and -40 bps YoY. For half year, cost of deposit was 0.79%, down by 43 basis points YoY. • • Loan yield remains under pressure from economic and low rate environment together with quality loan growth strategy to preserve B/S quality. As a result, yield dropped QoQ and YoY. Policy rate cuts from 1.25% to 0.5% throughout 2020 as a result, loan yield compressed to 4.56% in 1H21. • • NIM slightly dropped QoQ with the help on well-managed funding cost. YoY improvement was mainly from shift in loan mix and funding optimization. 1H21 NIM was stable YoY at 3% level. This was fully driven by balance sheet optimization and deposit repricing strategy during low rate environment which help compensate for yield pressure. 22 22#23Under Covid-19 and the focus on loan quality, NII on pressure • THB million Net Interest Income -0.7% QoQ -2.0% YoY 13,045 12,872 12,782 2Q20 1Q21 2Q21 -5.2% YoY 27,059 25,654 II 1H20 1H21 tub With the support from funding strategy, 2Q21 NII slightly dropped QoQ and YoY despite lower yields and volume as we continued to focus on quality amidst challenging environment. TTB selectively grew new loans and shifted towards lower risk areas, coupled with low interest rate environment and more conservative adjustment on accounting estimates. Due to lower interest rate YoY, 1H21 NII declined by 5.2% YoY. 23#24Lower consumer activities during Covid-19 pressuring Non-NII engines Total Non-Interest Income (Non-NII) tub THB million 7,705 7,089 -8% YoY 2,732 1,859 -32% YoY Total Non-NII 3,971 3,523 939 Other Non-NII 1,365 Net fee & 3,032 service income 2,158 3,118 -21% QoQ, -12% YoY 919 -2% QoQ, -33% YoY 2,198 -28% QoQ, +2% YoY 4,972 5,230 +5% YoY 2Q20 1Q21 2Q21 1H20 1H21 • Non-NII was weighted down by Covid-19 situation and partly by our selective asset growth strategy. • • • TTB posted THB3.1 bn of non-interest income in 2Q21 (-21.5% QoQ and -11.5% YoY) due mainly to lower net fees and service income. • Retail fees was hit by Covid-19 restriction measures that led to lower business activities and the postpone of some marketing and volume-boosting activates. • Commercial fees, on the other hand, Trade Finance and FX fees continued to grow YoY on the back of export/import recovery. 1H21 Non-NII declined by 8.0%, due to lower gain on investments while net fee and service income improved from the same period last year. Non-NII to avg. assets was at 0.80%, still in line with the guidance. Despite short-term hiccup from the pandemic, TTB continues to enhance our fee-base products and services with an aim to build recurring fee income in the long run. 24#25The 3rd wave disrupting retail fees recovery path Breakdown Strategic Fee Products THB million (Prelim data) +8% YoY 270 +8% YoY 250 803 -7% YoY 110 746 119 +55% YoY LG fee 1,536 132 990 TF and FX fee 135 383 3.13 55 Loan-related fee +4% QoQ, +4% YoY 131 43 137 +10% QoQ, +46% YoY 280 704 1,088 420 Mutual fund fee 132 287 53 55 560 447 Flat QoQ, +27% YoY -59% QoQ, +33% YoY Bancassurance fee 336 2,603 2,612 Flat YoY 1,514 1,388 1,044 1,083 1,224 -12% QoQ, +17% YoY 2Q20 3Q20 4Q20 1Q21 2Q21 1H20 1H21 tub • The QoQ reduction in net fee was due to; ■ Retail fees declined mainly from mutual fund and bancassurance sales due to slowdown business activities during the 3rd wave of Covid-19. ■ Commercial fees maintained growth momentum, supported by credit-related fee and trade finance as export & import activities showed a recovery sign. The YoY improvement was mainly from higher business activities compared to full lockdown last year. ⚫ 1H21 fee growth was mainly from mutual fund fee from high fee investment volumes at the beginning of the year. In this quarter, we relaunched new TSP (TTB smart portfolio), offering even better solutions than before. This is our aspiration to continue to develop our fee-base product and service with an aim to build sustainable fee base for the long run. 25#26Initial success at relaunching new TSP, building recurring fee for long run ttb smart 13.7 bn port Within 2 weeks performance in June AUM Low Wealth Preservation Risk Spectrum High Wealth Accumulation TSP 1 TSP 2 TSP 3 TSP 4 TSP 5 5 portfolios cater for each customer's risk appetite Portfolios is managed by investment professionals + rebalanced to keep allocation in shape Market differentiation Why New TSP is Better for Customer Everybody can invest With minimum only 1 baht to invest Reduce liquidity issue Able to buy/sell/switching daily even during portfolio adjustment and Settlement is T+5 tub Easy to track performance and able to display gain/loss Have NAV to easily track gain/loss and past performance Managed by Global Asset Managers, Amundi Paris and Thanachart Eastspring. Portfolio can be adjusted anytime to capture the market, plus wider range of fund choices beyond Thai domicile fund and can invest in cash or deposit for liquidity management. Choices in fund universe Screening from 30,000 funds globally vs. 2,000 funds available in Thailand Less cost and more transparency TSP directly invests in master funds. Hence, cost to serve customers is much lower and more transparent for customers. 26#27With cost discipline, cost synergy realization going as plan Total Operating Income Total Operating Expense Utb THB million THB million 34,764 32,743 -6% YoY 7,705 7,089 -8% YoY -6% QoQ -4% YoY -7% QoQ -5% YoY 16,569 16,844 3,523 3,971 15,900 3,118 -21% QoQ -12% YoY 7,776 7,928 7,402 27,059 25,654 -5% YoY 13,045 12,872 12,782 -1% QoQ -2% YoY 2Q20 1Q21 2Q21 1H20 1H21 • An economic slowdown from the pandemic resulted in core revenues -6% QoQ and -4% YoY. • . • 1H21 total operating income subsided to TH 32.7 bn. 2Q20 1Q21 2Q21 16,107 15,330 1H20 1H21 -5% YoY Recurrent expenses declined on cost-saving initiatives after merger. OPEX recorded at THB 7.4 bn, down by -7% QoQ and -5% YoY. The Bank made sure stringent cost saving initiatives come along as plan during this uncertain time. • 1H21 total operating expense included one-time separation package and other integration expenses which incurred in the first half. As of Jun-21, the Merged bank's headcount went down to 15,763 personnel (-3.7k after merger), resulting from the Bank's effort to execute merged bank synergies ■ Branch rationalization continues as plan (reduced by -18 branches QoQ, -231 branches YoY). 27#28C/I ratio in line with target, with long-term aspiration to achieve low-40s tub Cost-to-Income Ratio C/I ratio (excluded PPA impact) 45% 46% 45% 45% 45% 47% 47% 46% -1 bps -1 bps 46% 47% +1 bps 2Q20 1Q21 2Q21 1H20 1H21 . With the pressure on income affected from Covid-19, C/I ratio was at 47% with the effort in accelerating cost saving synergies to self-fund integration expenses. If excluded PPA impact, cost to income ratio would have been at 45.3%. C/I ratio is expected to remain at high 40s in the following quarters due to the remaining EBT-related expenses, some postponed marketing and rebranding activities and the additional expenses related-to Covid-19 health care for our employees. 28#29Pre-provision profit reflecting our prudent business direction • THB million Pre-Provision Operating Profit (PPOP) 8,791 8,898 8,502 -4% QoQ -3% YoY 18,653 17,401 -7% YoY 2Q20 1Q21 2Q21 1H20 1H21 tub As a result of our prudent business direction during fragile economic recovery from Covid-19, 2Q21 PPOP was THB 8,502 mn, -4% QoQ and -3% YoY. 1H21 PPOP recorded at THB 17.4 bn. 29 29#30Prudent risk management and prudent level of allowances set aside Utb ECL & Credit Cost Expected credit loss (ECL) (THB million) Annualized credit cost (bps) 238 199 THB million Net Profit 160 161 161 144 141 8,237 Flat QoQ +10% YoY 10,971 +13% YoY 9,732 -9% QoQ -18% YoY 6,863 3,095 4,972 5,480 5,491 2,782 2,534 1,619 1,235 2Q20 3Q20 4Q20 1Q21 2Q21 1H20 1H21 7,258 -27% YoY 5,316 2Q20 3Q20 4Q20 1Q21 2Q21 1H20 1H21 A growing number of Covid-19 cases and renewed partial lockdown measures are increasing uncertainty. Hence, the Bank has continued to manage down weak loans by written-off and sales to ensure balance sheets quality. In 2Q21, the Bank set aside provision for loans and management overlay in total of THB 5.5 bn. For the first half, credit cost was 161 bps. We ensure the sufficient ECL by our Principle-based relief schemes. Provision is expected to remain elevated in 2021 due to a pressure on asset quality after debt relief program expired and a longer-than expected Covid-19 situation. • As a result of revenue pressure and prudent risk management, 2Q21 net profit declined by 9% QoQ and 18% YoY. • Net profit in 1H21 dropped by 27% YoY. 30#31Building provision coverage by stage Distribution of Risk Provision *Remark 132% 131% 124% 125% LLR Ratio (%) 114% 52.0 53.8 54.4 Allowance for ECL (THB billion) 48.4 44.4 10.12 Stage 1 11.13 12.59 11.31 9.85 Stage 2 21.92 21.62 21.00 17.14 19.63 Stage 3 17.39 17.43 19.22 21.76 20.83 Jun-20 Sep-21 20-Dec Mar-21 Jun-21 Coverage by stage Stage 1 0.8% 0.9% 0.9% 0.8% Stage 2 13.1% 14.8% 17.7% 18.5% Stage 3 43.4% 45.6% 47.3% 49.3% 1.0% 18.0% 47.1% +24 bps from 2Q20 +481 bps from 2Q20 +379 bps from 2Q20 • As of Jun-21, Allowance for ECL rose further to THB 54.4 bn, consisting of ECL plus accumulated Management Overlay against Covid-19 uncertainty Overall risk provision by stage increased across all stages when compared to pre Covid-19 period, reflecting the Bank's tightening ECL model and prudent risk management. • LLR ratio was at 125% in line with our portfolio nature of retail and collateral base loans. Note: * Allowance of stage 3 is presented on a net basis to be in line with the industry * LLR as of Dec-20 at 131% represented changed in accounting report from gross basis to net basis to be in line with the industry tub 31#32Prudent actions to strengthen portfolio quality Loan Classification (%) NPL Ratio/Stage 3 Pre-Covid-19 19 1.60 tn 1,427 bn Stage 1 Stage2 Stage 3 14.3% 1.58 tn 1.50 tn 1,417 bn 1,346 bn 89.0% Stage 1 89.9% Stage 1 89.5% Stage 1 8.3% Stage 7.4% Stage 2 2.76% Stage 3 2.75% Stage 3 7.6% Stage 2 2.89% Stage 3 132 bn 116 bn 115 bn 44.1 bn 43.3 bn 43.5 bn Mar-20 Mar-21 Jun-21 2010 Stage 2+3 177 bn 160 bn 158 bn 2.76% 2020 TFRS9 tub 2.3% 2.5% 2.75% 2.89% Mar Jun 2021 • • • .. After the 1st wave of Covid-19 in 2020, TTB proactively resolved NPLs to clear up headroom for headwinds in 2021. We has also continued to de-risk weak loans in stage 2 to improve portfolio quality. As a result, stage 2 loan outstanding decreased to THB 115 bn or 7.6% of total loans as of Jun-21, compared to THB 132 bn or 8.3% as of Mar-20, a pre-Covid level. Stage 3 loan was at THB 43.5 bn, relatively stable. Stage 3 ratio rose to 2.89% due mainly to lower total loan volume and slow NPL resolution, remain in line with guidance and relatively low when compared to peers. For 2H21, TTB will continue to improve stage 2 while stage 3 is expected to persist from both NPL trend and our intention to slow NPL resolution activities to preserve NPL value from higher supply in the market. 32#33CET 1 4Q20 Reinforce capital position with wider buffer over requirements Solid Capital with ample buffer over requirement 14.4% 14.5% CET1 THB 166 bn TIER1 THB 178 bn CET 1 2Q21 19.6% +4.1% 15.5% + 1% Tier 2 AT1 issued in Nov-19 TIER 1 2Q21 THB 173 bn THB 185 bn RWA THB 1,217 bn THB 1,193 bn *prelim data for 2Q21 CAR 2Q21 Tier 1 minimum requirement 8.5% CAR minimum requirement 11.0% • tub We remain strongly capitalized, enabling the Bank to withstand the uncertainty ahead. Due to Economic headwind impacted from Covid-19 pandemic, the Bank reinforced solvency ratio with organic capital generation and balance sheet optimization, reflecting higher buffer Tier 1 and lower in credit RWA. 33#34Disclaimer: The information in this material is in summary form and does not purport to be complete. No representation or warranty, express or implied, is or should be made concerning, and no reliance should be place on, the accuracy, fairness, or completeness of this information and liability therefore is disclaimed. TTBThanachart Bank Public Company Limited (the "Bank" or "ttb" or "TTB") does not independently verified, approved or endorsed the information contained herein, or undertakes to update or revise any information, whether as a result of new information, future events or otherwise. The material to be presented may contain certain forward-looking statements and information regarding the Company that reflect current views and/or expectations of the Company with respect to its performance, business and future events. Statements relating to achieving certain goals are forward-looking statements. Forward-looking statements are based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realized. Past performance does not guarantee or predict future performance. A number of important factors could cause actual results or outcomes to differ materially from those expressed in any forward-looking statement. Representative examples of these factors include (without limitation) general industry and economic conditions, interest rate trends, cost of capital and capital availability, currency exchange rates, competition from other companies, shifts in customer demands, customers and partners, changes in operating expenses including employee wages, benefits and training, governmental and public policy changes and the continued availability of financing in the amounts and the terms necessary to support future business. Actual future performance, outcomes and results may differ materially from those expressed in forward-looking statements as a result of a number of risks, uncertainties and assumptions. You are cautioned not to place reliance on these forward-looking statements, which are based on current view of the management on future events. 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