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| Philippe Damas, ING: wants to build distribution |
Just as Thailand has entered a period of rare political calm and optimism with a new prime minister, one of its most sickly banks has been given a new lease of life with a landmark recapitalization. But, just as the jury is out on whether Thailand’s government can build on its new foundation, it remains to be seen whether TMB Bank can turn the corner after years of underperformance. TMB Bank was created in September 2004 from the merger of Thai Military Bank, DBS Thai Danu Bank and Industrial Finance Corporation. The merger created what was then the fifth-largest bank in Thailand. It now has 471 branches and 5 million deposit accounts but has struggled to generate performance to tally with its scale. It recorded a full-year loss of Bt43.7 billion ($1.39 billion) in 2007, three and a half times worse than the previous year, and has non-performing loans equivalent to 15% of lending as of the start of the year, having set aside Bt31 billion in provisions last year for loan-loss reserve requirements and increasing bad debt.
