CONTENT - maybank-ke.co.th · including the analysis results of macro factors in our country and outside with technique analysis. - Knowledge to investor program; the company subscribe

♦♦♦♦Annual Report 2013Annual Report 2013Annual Report 2013Annual Report 2013♦♦♦♦

CONTENTCONTENTCONTENTCONTENT PagesPagesPagesPages

CHAIRMAN’S STATEMENTCHAIRMAN’S STATEMENTCHAIRMAN’S STATEMENTCHAIRMAN’S STATEMENT

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POLICY AND BUSINESS OVERVIEWPOLICY AND BUSINESS OVERVIEWPOLICY AND BUSINESS OVERVIEWPOLICY AND BUSINESS OVERVIEW

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BUSINESS OPERATIONBUSINESS OPERATIONBUSINESS OPERATIONBUSINESS OPERATION

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RISK FACTORSRISK FACTORSRISK FACTORSRISK FACTORS

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CORPORATE INFORMATIONCORPORATE INFORMATIONCORPORATE INFORMATIONCORPORATE INFORMATION

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SHAREHOLDER STRUCTURESHAREHOLDER STRUCTURESHAREHOLDER STRUCTURESHAREHOLDER STRUCTURE

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DIVIDEND PAYMENT DIVIDEND PAYMENT DIVIDEND PAYMENT DIVIDEND PAYMENT POLICYPOLICYPOLICYPOLICY

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COMMITTEES AND MANAGEMENT STRUCTURECOMMITTEES AND MANAGEMENT STRUCTURECOMMITTEES AND MANAGEMENT STRUCTURECOMMITTEES AND MANAGEMENT STRUCTURE

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GOOD CORPORATE GOVERNANCEGOOD CORPORATE GOVERNANCEGOOD CORPORATE GOVERNANCEGOOD CORPORATE GOVERNANCE

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CORPORATE RESPONSIBILITIESCORPORATE RESPONSIBILITIESCORPORATE RESPONSIBILITIESCORPORATE RESPONSIBILITIES

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INTERNAL CONTROL AND RISK MANAGEMENTINTERNAL CONTROL AND RISK MANAGEMENTINTERNAL CONTROL AND RISK MANAGEMENTINTERNAL CONTROL AND RISK MANAGEMENT

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CONNECTED TRANSACTIONCONNECTED TRANSACTIONCONNECTED TRANSACTIONCONNECTED TRANSACTION

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FINANCIAL INFORMATIONFINANCIAL INFORMATIONFINANCIAL INFORMATIONFINANCIAL INFORMATION

75757575

MANAGEMENT DISCUSSION AND ANALYSISMANAGEMENT DISCUSSION AND ANALYSISMANAGEMENT DISCUSSION AND ANALYSISMANAGEMENT DISCUSSION AND ANALYSIS

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AUDITORS’ REPORTAUDITORS’ REPORTAUDITORS’ REPORTAUDITORS’ REPORT

84848484


“The investor can find more information of the Company from Annual Report (Form56-1) from www.sec.or.th or the Company’s website.”

♦♦♦♦ Message from the Chairman ♦♦♦♦


Pages 1 Back to ContentBack to ContentBack to ContentBack to Content

♦Message from the Chairman♦

The Year 2013 is a great year for stock investors and securities companies in Thailand. The SET Index reaches the highest point at 1,643.43. Total trading value for the

entire year is THB 24.66 trillion, with an average daily trading value of THB 50,329.27 million. This represents an increase from the Year 2012 in which total trading value for the entire year is THB 15.83 trillion, with an average daily trading value of THB 32,304.36 million.

The Year 2013 is the year in which the Company could maintain its leadership in the domestic brokerage business for 12 consecutive years, with total market share of 11.54 %.

Total revenue rises from THB 3,233.32 million in the Year 2012 to THB 4,756.40 million in the Year 2013. Total net profit increases from THB 736.02 million in the Year 2012 to THB 1,420.54 million in the Year 2013, an increase by 93 % on a year-to-year basis. The

Company’s EPS rose from THB 1.29 in the Year 2012 to THB 2.49 in the Year 2013. With sound financial performance & condition coupled with supports from Maybank Group, the

Company could still make dividend payment at the payout ratio of 99.65 %, or THB 2.48 per share.

Receivables from margin loans rise from THB 8,776.28 million at the end of 2012 to

THB 10,119.92 million at the end of 2013, 15.31% increase. Thus, total assets rise from THB 14,019.71 million at the end of 2012 to THB 14,684.97 million at the end of 2013. The

Company could extend greater amount of margin loans due to financial supports from the Maybank Group and its strong credit rating which has helped to facilitate it in obtaining loans from financial institutions. During the year, the amount of Margin Loan was

increased up to THB 15,000 million, with the condition of such good quality of clients and the risk management system, it made company had no bad debt along the 12 consecutive

years.

From our dedication to maintain our services to client, the Company had its development on the trading system for supporting the high volume and maintaining the

productivity of our services. The maximum trading value of the Year 2013 reached to THB 100,000 million. The Company was also able to give the excellent services to clients.

Referring to the turnover of the Company, the results of our development and maintaining the quality of services made our clients maximum satisfaction. In 2013, the Company won the award from many organizations from Thailand and outside Institution as

below:

1. The Best Retail Broker in Thailand, maintaining the 3rd year of the Best Retail

Brokerage in Thailand;

2. The Best Institutional Broker in Thailand from Alpha Southeast Asia; and

3. The Best Equity House in Thailand from The Assets AAA.

Last but not least, I would like to express my deepest thanks to all the Company’s clients, if we had no your helpful and supportive, the turnover and the results of work might

not be appeared to the public and patronages, the Maybank Group, all shareholders and

♦♦♦♦ Message from the Chairman ♦♦♦♦



domestic financial institutions that continue to provide good support to the Company. I would also like to thank all management and staff who have worked hard and dedicated

themselves for the success of the Company.

♦♦♦♦Policy & Business Overview♦



♦♦♦♦ Policy & Business Overview ♦

• Vision, Objective, Business StrategyVision, Objective, Business StrategyVision, Objective, Business StrategyVision, Objective, Business Strategy o Vision:

To be a Regional Powerhouse by 2015.

o Mission:

Maybank Kim Eng Securities (Thailand) offers a wide variety of the highest

standard services to customers. Our goal is to become a regional financial services leader by 2015. We aim to benefit clients with the high quality and

extensive scope and scale of our services, supported by our high-tech, real-time trading platforms and dedicated service-oriented staff.

• Business Strategy:

- Staff value, we believe that the significant factor for our business is human resource. The Company has its policy to take a good care to our staff not only in the fringe

benefit under the Securities and Exchange Commission ’s rules, but also supporting our staff in academic and research in equity instrument and the others financial instrument for fining new good opportunities for our clients and our staffs.

- Technology Development

o the Company invests in the information technology especially, security trading system. The main purpose of development in this area is for improving the efficiency, stability and accuracy to serve our client need in

accurate and timely manner. o the Company has its network in research side, the objective is to distribute a

real time research to each branch by non disturbing to trading transaction in daily basis.

o the Company has form the efficiency internet trading system and readiness

in research information for supporting client’s investment and client’s order faster, accuracy and adequate.

o Developing trading system on other devices such as IOS, Android, etc.

- Developing the research to be readiness in basic factors and technique. We do

emphasis our staff to have an interview with the management level person in the listed company for squeezing into the analysis results, accuracy basic factors

including the analysis results of macro factors in our country and outside with technique analysis.

- Knowledge to investor program; the company subscribe the members via campaign

“Maybank Kim Eng Fan Club” for delivery investor knowledge to clients such as

Value Investor investment, Internet System Investment, basic factor and technique analysis, investment in debenture, convertible debenture, derivative warrant. This is

not only providing the knowledge to our clients and investors but also finding the new way to expand our customer base.




• Significant Change and EvolutionSignificant Change and EvolutionSignificant Change and EvolutionSignificant Change and Evolution

Maybank Kim Eng Securities (Thailand) Public Company Limited (the “Company”)

named previously “Kim Eng Securities (Thailand) Public Company Limited” formerly changed from “Nithipat Securities Company Limited” incorporated on April 3, 1996 with its

first capital THB1,000 million. The separation of the business from capital business and securities business of Nithipat Capital and Securities Public Company Limited, Nithipat Finance Public Company Limited hold the 99.99% sold shares of Nitipat Capital and

Securities Company Limited. On August 14, 1996 had gained the transferred of assets and liabilities related to securities business including the Stock Exchange of Thailand’s

membership No. 42 from Nithipat Capital and Securities Public Company Limited which had been agreed from Securities and Exchange Commission of Thailand (SEC) and started to operate securities business onward.

Economic crisis in 1997, closing of 56 Financial Institutions following to government announcement on August 8, 1997 concerning to closing the business of Nithipat Finance

Public Company Limited who was the parent Company of our Company. However, the company was still had its operation under the supervision of Financial Sector Restructuring Authority (FRA) before changing the major shareholders. Kim Eng Holdings Company

Limited who was incorporated in Singapore and hold major shares in securities firms under Security of Exchange market in Asia and had its network across countries and finally,

become listed company in Security of Exchange in Singapore, won bidding to buy Nithipat Securities Company Limited (Nithipat) from FRA and became a shareholders and management of the Company.

In January 1, 2002 the Company had singed in the Transferred Asset Agreement for obtaining the assets from Yuanta Securities (Thailand) Company Limited which had been

merged with Yuanta Securities (Thailand) Company Limited.

In October 17, 2002, the Company had converted itself into Public Company Limited, in the same time had changed its name to be “Kim Eng Securities (Thailand) Public

Company Limited. The company had registered in the Security Exchange of Thailand and our ordinary shares had been traded on December 3, 2003 afterward.

In 2007, the Company obtained the permission from Ministry of Finance (MoF) to set up the Asset Management Company, KEST Guardian Asset Management Company Limited was incorporated (after known as Kim Eng Asset Management Company Limited

and Maybank Kim Eng Asset Management Company Limited, respectively). And also launched the Exchange trade Fund (ETF) with refer to SET 50 index which the first fund of

Thailand under the name “TDEX”

In 2011, Maybank IB Holdings Sdn Bhd had bought 100% ordinary shares of the Kim Eng Holdings Company Limited (currently, Maybank Kim Eng Holdings Company Limited)

which was the major shareholders of the Company proposed buying ordinary shares of the Company in amount of 27.99% (excluded treasury stock) and restructure the shareholder

structure. Maybank Kim Eng Holdings Company Limited became our major shareholders hold 83.50% shares.




The Company still continuously maintaining No. 1 of the securities brokerage market share in 2002-2013

• Group of Company Shareholder StructureGroup of Company Shareholder StructureGroup of Company Shareholder StructureGroup of Company Shareholder Structure

March 21, 2013, the Company had sold its 99.99% shares of Kim Eng Asset Management Company Limited, our subsidiary company (formerly named, KEST Guardian Asset Management and had changed to Kim Eng Asset Management Company Limited)

which operating its business in Asset Management. Kim Eng Asset Management (Thailand) Company Limited was incorporated on May 18, 2007 with its capital THB 100 million (fully

paid-up).

• Relation of Relation of Relation of Relation of Group Business of Major ShareholderGroup Business of Major ShareholderGroup Business of Major ShareholderGroup Business of Major Shareholder

Our securities business is a part of business in MALAYAN BANGKING who operate

Finance Institution in Malaysia by hold its shares on Maybank Kim Eng Holdings Singapore 83.50% of shares and has its shareholder structure as follows:

MALAYAN BANKING GROUP and the Company have its professional management

team. MALAYAN BANGKING had appointed its management to be a Director of the

Company. This is for the purpose of initiative together the operating policy.

(1) The Company had fully sold all investment to Maybank Asset Management Group on March 21, 2013

MALAYAN BANKING

MAYBANK IB HOLDING SDN BHD

(IB Holdings Sdn Bhd )

MAYBANK KIM ENG HOLDINGS LIMITED

MAYBANK KIM ENG SECURITIES (THAILAND) PLC.

MAYBANK ASSET MANANGEMENT (THAILAND) CO., LTD. (1)

100%

100%

83.50%

99.99%

♦ Business Operation♦


Pages 6 Back to Back to Back to Back to ContentContentContentContent

♦Business Operations♦

• Revenue StructureRevenue StructureRevenue StructureRevenue Structure

Consolidate Financial StatementConsolidate Financial StatementConsolidate Financial StatementConsolidate Financial Statement from from from from fiscal year fiscal year fiscal year fiscal year 2011 to 20132011 to 20132011 to 20132011 to 2013

Revenue

2011

Jan-Dec 2011

2012

Jan-Dec 2012

2013

Jan-Dec 2013

Million Million Million Million

BahtBahtBahtBaht %

MillionMillionMillionMillion

BahtBahtBahtBaht %


BahtBahtBahtBaht %

Securities Brokerage Fee 2,286.93 71.62 2,256.10 69.40% 3,349.59 70.42%

Futures Brokerage Fee 337.47 10.57 264.97 8.15% 268.99 5.66%

Fee and Service 45.39 1.42 77.82 2.39% 72.06 1.52%

Gain (Loss) on securities (84.10) (2.63) (68.84) (2.12%) (159.23) (3.35%)

Gain (Loss) on derivatives 133.54 4.18 94.99 2.92% 179.06 3.76%

Interest and dividends 212.61 6.66 237.92 7.32% 329.49 6.93%

Interest on margin loan 237.40 7.44 343.41 10.56% 636.22 13.38%

Gains on sale of investment in

subsidiary - - 18.62 0.57% 18.62 0.39%

Others 23.70 0.74 26.09 0.80% 80.01 1.68%

Total 3,192.94 100.00 3,251.08 100.00% 4,774.81 100.39%

Remark:Remark:Remark:Remark: Subsidiary Company (Kim Eng Asset Management (Thailand) Limited) was

incorporated on May 18, 2007. Referencing to financial statement, the revenues

come from receivable interest for fiscal year 2011, 2012 and 2013 in the amount of

THB1.87 million, 1.30 million and 2.89 million, respectively. In 2013, the Subsidiary

Company had figured loss in the amount of THB14.26 million which came from the

significant cost of THB10.73 million from employee expenses and THB4.33 million

from Information Technology expenses. However, the Subsidiary Company

received the income from its operation in 2013 from fee and services of asset

management and personal fund in the amount of THB4.39 million.

However, the Company had sold out its investment in Subsidiary Company on

March 21, 2013.




Separate Financial Statement from fiscal year 2011 to 2013Separate Financial Statement from fiscal year 2011 to 2013Separate Financial Statement from fiscal year 2011 to 2013Separate Financial Statement from fiscal year 2011 to 2013

Revenue

2011

Jan – Dec 2011

2012

Jan – Dec 2012

2013

Jan - Dec 2013


BahtBahtBahtBaht %


BahtBahtBahtBaht %


BahtBahtBahtBaht %

Brokerage Securities Fee 2,286.93 71.65 2,256.10 69.78% 3,349.59 70.42%

Brokerage Futures Fee 337.47 10.57 264.97 8.19% 268.99 5.66%

Fee and Service 44.95 1.41 78.67 2.43% 72.21 1.52%

Gain (Loss) on securities (84.10) (2.63) (68.84) -2.13% (159.23 ) (3.35%)

Gain (Loss) on derivatives 133.54 4.18 94.99 2.94% 179.06 3.76%

Interest and dividends 210.74 6.60 237.93 7.36% 329.49 6.93%

Interest on margin loan 237.40 7.44 343.41 10.62% 636.23 13.38%

Gains on sale of investment in

subsidiary - - - - 0.00 0.00%

Others 24.89 0.78 26.09 0.81% 80.06 1.68%

Total 3,191.82 100.00 3,233.32 100.00% 4,756.40 100.00%




• Market and Business ConditionsMarket and Business ConditionsMarket and Business ConditionsMarket and Business Conditions o Brokerage BusinessBrokerage BusinessBrokerage BusinessBrokerage Business

In 2013, SET Index highest at 1,643.43 points and closed at the end of year 1,298.71

points, contracting -6.7% since 2012. In 2013, the Thai market contributed the poorest return of other Asian markets. However, the average trading volume per day was at record highs

of THB50,329.27 billion up 56% from 2012 at THB32,304.36 billion. This reflects the high volatility of the Thai equity market in 2013. In January-March, the Thai market was bullish with the SET Index reaching a 19-year high at 1,649.77 points with high average trading

volume per day of THB50-60 billion. Moreover, many new accounts were opened. However, after May, the Thai market began to contract along with other Asian markets with heavy

capital outflow back into the US market after the US economy began to recover on the hopes of QE spending tapering. The currency exchange market was highly volatile as investors were concerned on the deficits in India and Indonesia, which impacted the Thai

equity market. Internally, Thai economic growth slowed and household debt rose above 70%, while exports could not achieve targets. The political tension rose. many Thai people

began to protest from November onward. Hence, the THB2 trillion infrastructure and THB350 billion water management bills have been frozen, leading to profit taking by foreign investors from the Thai equity market. In 2013, foreign investors were net sellers of

THB193.911 billion, local institutions were net buyers of THB108.163 billion and retail investors were net buyers of THB87.47 billion.

In 2013, the brokerage business was very impressive with a significant increase in net profit YoY, inline with a 51% increase in trading volume. This should be a partial result from the IPOs of 16 companies on the SET and 15 companies in the MAI market, valued at

THB339.891 billion (+31.69% from 2012). In 2013, margin loans also saw a significant rise.

The company has remained no.1 broker with a market share of 11.54% for 2013, a

slight drop from 11.86% in 2012. In 2013, there was a slight change in investor structure, as retail investors increased to 55.2%, proprietary trades remained unchanged at 13%, local institutions increased to 8.9% and foreign investors dropped to 23% from 25% in 2012.

o The Business of Debt Issuance and TradingThe Business of Debt Issuance and TradingThe Business of Debt Issuance and TradingThe Business of Debt Issuance and Trading

For the primary market, total value of new debt issuance registered with ThaiBMA

for the year 2013 was THB 8.66 trillion, a decrease by 16% when compared with that in the Year 2012. Total outstanding amount of domestic debt instruments registered with ThaiBMA as of 28 December, 2012 was THB 8.99 trillion, an increase by 4.8% when

compared with that at the end of 2012. Debt securities with the highest outstanding amount was Government bond with the total outstanding value of THB 3.34 trillion. This

represents a growth of 10.3% compared to that of the previous year. The second and third outstanding of debt securities with highest outstanding amount were Bank of Thailand Bond with outstanding value of THB 2.84 trillion or a decrease by 8.9% and Long-Term

Corporate Bond and Commercial Paper with total outstanding value of THB 1.88 trillion, an increase by 13.6%.

In 2013, the Company issued the bill of exchange (BE) in order to expand its business and support the demand of Margin Loan whole year, the total value of issuance was THB 12,458 million under the condition of exchange term not exceeding 270 days.




o Financial Advisory and Securities Underwriting BusinessFinancial Advisory and Securities Underwriting BusinessFinancial Advisory and Securities Underwriting BusinessFinancial Advisory and Securities Underwriting Business

The fund raising via primary market (IPO) substantially improved both in terms of

issues and funding amount in both the SET and the MAI totally 38 companies (including property fund) worth a total funding of THB 339.89 trillion, an increase of 31.69% compared

to that in the year 2012, with 16 companies listed on the SET and 15 companies listed on the MAI. As of 31 December, 2013, total 585 listed companies on the SET and the MAI were 490 and 95 companies respectively. For the Year 2013, the company acted as Financial Advisor

and Lead Underwriter on the Public Offering of Interlink Communication Plc., the amount of THB 395 million, Lead Underwriter on Public Offering with warrants of Universal

Adsorbent Chemicals Plc. the amount of THB 395 million, Financial Advisor on Big Lot of BTS Group Holding of THB 1,205 million, Financial Advisor and Lead Underwriter on Right Offering of Italian Thai Development Plc. the amount of THB 2,000.38, Independent

financial advisor on asset acquisition and connected transaction of Office Mate Plc. with total value of THB 9 billion, Independent financial advisor on asset acquisition (Siam Makro

Plc.) with total value of THB 188,880 million, Financial Advisor on IPP Bidding Round 3 and on Private Placement to Strategic Partners of National Power Supply Plc. with value of THB 15,000 million and THB 1,864.65 respectively.

The Investment Banking Department total income for the Year 2013 was THB 55.37 million, a decrease by 4.42% from that of THB 57.93 million in the Year 2012.

o The Derivatives Agent BusinessThe Derivatives Agent BusinessThe Derivatives Agent BusinessThe Derivatives Agent Business

The Company was granted by the Ministry of Finance a license to operate business as a derivatives agent in accordance with the Derivatives Act B.E. 2546 (2003). As a

derivatives agent, the Company has serviced individual clients and institutional clients since the launch of Thailand Futures Exchange (TFEX) on 28 April 2006. Currently, TFEX offers 9

exchanged-traded derivatives products, namely, SET50 Index Futures, SET50 Index Options, Single Stock Futures, Gold Futures, Silver Futures, Brent Crude Oil Futures, Interest Rate Futures, USD Futures and Sector Futures.

For the Year 2013, the total volume on TFEX was 16,664,126 contracts. The average daily volume of SET50 Index Futures in the year was 23,218 contracts, an increase of 41%

compared with that of 2012 for 16,467 contracts per day. For SET50 Index Options, the average daily volume was 267 contracts, an increase of 21% compared with that of 2012 for 221 contracts per day. For Single Stock Futures, the average daily volume was 34,351

contracts, an increase of 288.2% compared with that of 2012 for 8,849 contracts per day. For Gold Futures, the average daily volume was 9,009 contracts, a decrease of 39.4% compared

with that of 2012 for 14,868 contracts per day. For Silver Futures, the average daily volume was 5 contracts, a decrease of 91.7% compared with that of 2012 for 60 contracts per day. For Brent Crude Oil Futures, the average daily volume was 190 contracts, a decrease of

68.5% compared with that of 2012 for 603 contracts per day. For USD Futures, the average daily volume was 977 contracts per day, a decrease of 64.5% compared with that of 2012 for

2,751 contracts per day. Overall, investors in the derivatives market compose of domestic individual investors that accounted for 56.03% of total volume, domestic institutional investors that accounted for 35.92% of total volume and foreign investors that accounted

for 8.05% of total volume.




For 2012, the Company ranked No. 4 for derivatives trading in term of market shares that accounted for 6.59% of the total volume in the derivatives market. The total volume for

derivatives traded via the Company was 2,194,965 contracts. The majority of the company’s volume is from operating derivatives agent business on behalf of the clients.

The Company has long emphasized expanding its investor base in the derivatives market. It has continuously provided a variety of training courses related to derivatives instruments to its clients and general investors. This is because the Company has always

been aware that its long-term success in the derivatives business depends upon investors’ knowledge and understanding in derivatives trading strategies, return & risk related to

derivatives investment and their abilities to apply derivatives instruments for investing and hedging purposes. The Company aims to grow concurrently with continuous expansion in the number of investors and client bases. Relating to derivatives investment strategies, the

Company continues to produce and publicize daily derivatives research papers for technical analysis three times a day before morning session, before afternoon session and before

night session. The recommendations of derivatives investment strategies are broadcasted in visual and audio forms via KELIVE TV which the clients can access via the Internet and the clients can watch a morning live program on every business day or can access a

recorded program later.

o Derivative Warrant (DW)Derivative Warrant (DW)Derivative Warrant (DW)Derivative Warrant (DW)

The company – Maybank Kim Eng Securities (Thailand) Plc, - has a credit rating “AA” by Fitch Ratings (Thailand) and is one of the first brokerage houses issuing Derivative Warrant (DW) in Thailand via direct listing method in 2010. In 2013, the company had issued

49 DWs that earned good responses from investors.

Nevertheless, the company recognizes that DW is a new product, hence, we have

continuously provided a variety of training courses to the clients and general investors along with producing and publicizing daily DW research papers called “Derivative Warrant Strategy Update”. In addition, the recommendations and investment strategies are

broadcasted in visual and audio forms via KELIVE TV which clients can access via the internet to watch the program and to educate the investors and marketing representatives

for new knowledge and up-to-date situation.

o Asset Management BusinessAsset Management BusinessAsset Management BusinessAsset Management Business

In the year 2013 the investment in mutual fund has received more popularity from

both retail investors, institutional investors and those with savings during volatile market of both financial and capital markets. A the end of the year 2013, total Net Asset Value (NAV)

of Thailand fund management industry was approximately THB 2.9 trillion , an increase by 12% of total NAV of mutual fund f industry compared to that at the end of the year 2013.

There was a large number of interesting mutual funds establishment, which most of

them are Infrastructure fund and Property Fund In the year 2013. There were 3 funds setup and sale of units in the year 2013 including BTS Rail Mass Transit Growth Infrastructure

Fund (BTSGIF), Amata B. Grimm Power Power Plant (ABPIF), and True Telecommunications Growth Infrastructure (TRUEIF), which has been well received by investors with total funding raising more than THB 126,000 million.




During the year 2013, there were 7 new establishments of Property Fund under the capital raising of THB 25,000 million which invested in the assets similar to hotel, office

building and Industrial estate etc.

♦♦♦♦ Risk Factors ♦♦♦♦



♦ Risk Factors ♦

1111.... Fluctuations in the conditions of international and domestic economies, money Fluctuations in the conditions of international and domestic economies, money Fluctuations in the conditions of international and domestic economies, money Fluctuations in the conditions of international and domestic economies, money markets and capital markets could materially affect the Company’s revenue.markets and capital markets could materially affect the Company’s revenue.markets and capital markets could materially affect the Company’s revenue.markets and capital markets could materially affect the Company’s revenue.

The Company’s major source revenue is brokerage fees from the securities and derivatives business that has been directly related to macroeconomic condition, movements of money and capital markets, trading volume on the Stock Exchange of

Thailand (SET) and investor confidence, all of which are factors that are beyond control of the Company. In the Years 2011, 2012 and 2013, average daily trading values of the SET were

THB 29,066, 29,473 and 32,304 million consecutively. For the Year 2013, average daily trading value of the SET was THB 150,329 million, an increase by 55.79 % compared to that in the Year 2012. All factors, including internal and external ones, substantially increase

investor’s confidence. For the Years 2011, 2012 and 2013, the Company’s total brokerage fees were THB 2,624, 2,521 and 3,618 million consecutively.

Fluctuations in the economy, the money market and the capital market may be caused by a large number of factors that are beyond control of MBKET, including civil unrest in the three most southern provinces of Thailand, domestic political uncertainties

and global economic crisis in the US and Europe . Such factors would negatively affect confidence of both domestic and foreign investors and, as a consequence, may adversely

affect the volume of trading on the SET and the MAI, including the amount of funds to be raised and the number of new listings on the SET and the MAI. This could have a material adverse effect on MBKET’s business, financial condition and result of operation.

MBKET has mitigated such risk by providing some parts of compensation made to marketing officers and securities traders that vary with trading volume on the SET to

control its fixed operating costs, expanding its brokerage client base to include both individual and institutional clients and generating revenue from a variety of financial advisory services including securities offering, M & A, business takeovers, project feasibility

studies, business valuation and securities underwriting. MBKET also engages in other businesses to generate additional sources of revenue such as asset management, private

fund management, securities borrowing & lending (SBL) and the derivatives business.

2222.... Risk due to Intense Competition in the Securities BusinessRisk due to Intense Competition in the Securities BusinessRisk due to Intense Competition in the Securities BusinessRisk due to Intense Competition in the Securities Business

Securities business has been a quite highly competitive business, especially in the

area of securities brokerage that has long been the Company’s major source of revenue. The Stock Exchange of Thailand (SET) has changed the brokerage fee structure, specifying a

minimum brokerage fee at the rate of 0.25 % of total trading value for the period between January 14, 2002 and January 13, 2007. Later on December 25, 2006, the SET extended the period in which a minimum brokerage fee is still applied for another 5 years. The period is

classified into 1) For the first 3 years (January 1, 2007 to December 31, 2009) in which a minimum brokerage fee of 0.25 % is still applied and 2) For the next 2 years (January 1, 2010

to December 31, 2011) in which the brokerage fee is determined on a sliding scale basis. In other words, for the period between January 1, 2010 and December 31, 2011, the higher the trading value, the lower the applied rate of the brokerage fee. For year 2012, calculation for

the brokerage fee is deliberated. Thus, from the Year 2010 on, the securities brokerage




business will be a highly competitive business in terms of securities brokerage fee. To cope with the increasing level of competition in the securities brokerage business, the Company

has put extra efforts in improving every area of its service quality, especially Internet trading service. This is because the brokerage fee applied to Internet trading has still been

lower than that applied to traditional trading service (Internet trading brokerage fee is 60 % of that applied to traditional trading service). Internet trading has thus drawn strong interest from a lot of securities investors. The Company has long focused on providing

high-quality services with the aim to maintain and expanding the existing client base. The Company has done so by increasing the quality of research publications, improving and

developing skills and capabilities of staff in providing services and recommendations to clients. The Company has continuously upgraded its information system to respond to and satisfy fast-changing client needs. All of these have enabled the Company to be in a good

position and well prepared for liberalization of the securities brokerage fee structure that would be effective on January 1, 2012, and thus intensifying competition in the securities

brokerage industry.

Financial advisory and investment banking services and fees have also been competitive in terms of both service quality and advisory fee levels. MBKET has provided a

variety of financial advisory services including securities offering, independent financial advisory, fund raising, M & A, business takeovers, business valuations etc, focusing on

provisions of high-quality services. The Company has continuously developed and upgraded advisory skills of its IB staff, and this enables it to provide high-quality financial advisory services to clients on a continuous basis.

MBKET was also granted a license to operate its business as a derivatives agent in accordance with the Derivatives Act B.E. 2546. It was selected as a member of Thailand

Futures Exchange (TFEX) that was launched on April 28, 2006 and Thailand Clearing House (TCH) to operate its business as a derivatives agent. This has helped to expand the Company’s source of revenue.

3333.... In its secIn its secIn its secIn its securities brokerage business, the Company is highly dependent on a urities brokerage business, the Company is highly dependent on a urities brokerage business, the Company is highly dependent on a urities brokerage business, the Company is highly dependent on a small number of large clients.small number of large clients.small number of large clients.small number of large clients.

The Company’s top 10 trading clients accounted for 24.59 %of total securities brokerage fee income in the year 2012 and 21.71 % in 2013. Had MBKET lost such big trading clients, its securities brokerage fees for 2011 and 2012 would have fallen by 5.54% and

4.29%, respectively. However, one of the Company’s top 10 trading clients was the Maybank Kim Eng Holdings Group that is also the major shareholder. Thus, it is quite

unlikely that it will lose such a client. As MBKET has long realized concentration risks, it has thus aimed to increase the number of trading accounts in order to expand its client base. For the year ended December 31, 2012 and 2013, the total number of MBKET’s client trading

accounts was 119,000 and 143,000, respectively. For 2013, 94.06% of the Company’s securities brokerage fees were from retail trading business and the remainder 5.94% from

local and foreign institutions. Another source of the Company’s operating revenue was from Investment Banking business (financial advisory and securities underwriting businesses) that generated total revenue of THB 49.21 million, a decline of 14.71 % from the

2012 level. This has helped to generate another source of operating revenue for the Company and allowed it to rely less on securities brokerage business.




4444.... Clients may default or delay payment for or transfer of securities and collateral Clients may default or delay payment for or transfer of securities and collateral Clients may default or delay payment for or transfer of securities and collateral Clients may default or delay payment for or transfer of securities and collateral for taking position in futuresfor taking position in futuresfor taking position in futuresfor taking position in futures

For the year ending December 31, 2013, the Company’s securities brokerage receivables totaled THB 12,830.21 million, consisting of clients’ accounts of THB 2,312.27

million, margin loans of THB 10,119.92 million, securities borrowing and lending accounts of THB 152.22 million, there and other receivables of THB 245.80 million, with unearned interest revenue of THB 63.47 million. In addition, the Company had derivatives business

receivables amounting THB 9.47 million outstanding. It classified such securities and derivatives brokerage receivables as doubtful debt in the amount of THB 260.69 million,

accounting for 2.03 % of its total securities and derivatives brokerage receivables. Of the total amount of doubtful debt, THB 256.08 million of which belonged to Nithiphat Securities Co., Ltd., was incurred prior to acquisition of the ordinary shares of that company

by Kim Eng Holdings Limited in 1998, and THB 4.60 million of which was incurred after the share acquisition by Maybank Kim Eng Holdings Limited. The Company tries to collect all

doubtful debts as fast as possible, and if it cannot do so, it will file a lawsuit against the defaulting receivables.

For the total doubtful debt of THB 260.09 million, THB 9.13 and 250.96 million of

which were classified as substandard and doubtful debts. The Company established an allowance for doubtful debt in the total amount of THB 259.80 million, or 100% of the total

doubtful debt.

In the derivatives agent business, the Company may face the risk that collateral clients put up may not be sufficient to satisfy their debt obligations with TCH. Thus,

MBKET, as a derivatives agent, is obligated to follow and collect more collateral from clients to satisfy debts incurred as a result of loss from holding a position in futures.

Nevertheless, MBKET has implemented many policies aimed to mitigate default risk as a result of securities and derivatives trading. It has done so by focusing on selecting high-quality clients and specifying trading limits for securities and derivatives that well

correspond to securities collateral amount, clients’ financial status, their abilities to repay debts, liquidity conditions and investment experience. MBKET has regularly reviewed and

closely monitored the receivables’ status.

5555.... Risk Associated with Margin AccoRisk Associated with Margin AccoRisk Associated with Margin AccoRisk Associated with Margin Account under the Credit Balance Systemunt under the Credit Balance Systemunt under the Credit Balance Systemunt under the Credit Balance System

In extending margin loans to securities trading clients, the Company may face the

risk that margin clients may default their repayments, especially in the case that value of securities put as collateral falls below their outstanding margin amount. Normally, such

repayment default will not occur under the credit balance system as margin clients are required to maintain their maintenance margin in accordance with conditions as prescribed by the Company and relevant regulators. If the proportion of collateral to outstanding

margin amount falls below the prescribed ratio, the procedures related to call margin and force sell will apply respectively. Nevertheless, some adverse abnormal situation may occur,

thus leading to a sharp decline in the value of securities put as collateral, such that the system of maintenance margin cannot cope with it. To manage this risk, the Company formulates and applies clear and stringent policies in selecting securities allowed to be

traded under the margin system as well as prescribing initial margin for such securities. The Company does not allow its clients to trade risky/speculative securities under the margin




system. The Company also prescribes ceiling margin amounts for each client in trading particular securities.

Margin loans amounts as of December 31, 2011, 2012 and 2013 were THB 4,404.76, 8,776.28 and 10,119.92 million respectively. Margin loans amount outstanding may vary each

year, depending upon trading activities on the SET. For the period that margin loans amount outstanding sharply increases, the Company realizes the potential risk associated with margin account. The Company complies with policies/measures in dealing with this

risk as described in the previous paragraph stringently. In the past, the Company never faced serious damage due to extending margin loans.

6666.... Any failure in computer systems may disrupt the Company’s securities Any failure in computer systems may disrupt the Company’s securities Any failure in computer systems may disrupt the Company’s securities Any failure in computer systems may disrupt the Company’s securities brokerage business operationsbrokerage business operationsbrokerage business operationsbrokerage business operations

To operate its securities brokerage business, the Company relies heavily on its

computer systems. Main computer systems that have supported the Company’s operation of securities trading are comprised of 1) HiTrade that is connected to the SET for securities

trading on a real-time basis. It enables securities marketing officers and clients to closely monitor share price movement, to submit trading orders and check trading order status. HiTrade is connected to the Internet, thus allowing clients to monitor share price

movement and submit trading orders via the Internet as well. 2) The computer system that is connected to TFEX and enables securities marketing officers to submit trading orders for

futures contracts on behalf of their clients, and the computer system that is connected to SET Trade that allows clients to submit their trading orders via the Internet. 3) Share settlement systems for transactions between clients and TSD, namely the Securities Back

Office Automation, or SBA. If the Company’s computer systems fail, the operation of the Company in the securities brokerage service will be materially affected.

To mitigate such risk, the Company set up a backup system as well as back up of important information, both of which enable the Company to operate smoothly in case of a failure of the main system. To connect the main office’s computer system and those of the

branch offices, the Company has a back up leased line that can switch when the leased-line fails. Also, the Company has a contingency plan that allows the use of a back-up computer

system when contingency plans are implemented.

7777.... As an underwriter, thAs an underwriter, thAs an underwriter, thAs an underwriter, the Company is required to subscribe for unsubscribed e Company is required to subscribe for unsubscribed e Company is required to subscribe for unsubscribed e Company is required to subscribe for unsubscribed securities that may expose it to large lossessecurities that may expose it to large lossessecurities that may expose it to large lossessecurities that may expose it to large losses

In relation to investment banking business in which the Company acts as an underwriter, it assumes an underwriting risk that may require it to purchase any

unsubscribed securities for its own account. This may be due to inappropriate pricing and fluctuations in both money and capital markets. If, in the future, the Company is required to purchase underwritten securities for its own account, it may result in significant losses

that could have a material adverse effect on its financial condition, particularly the net capital ratio, and its results on operations.

To mitigate this risk, prior to participating as an underwriter for any securities, the Company conducts a study and analysis of the business potential of issuers as well as client interest, and the Company will act as underwriter for securities only with minimal risk of




securities under subscription. In case the Company acts as underwriter for securities at significant amounts, approval for securities underwriting from the Underwriting

Committee needs to be obtained prior to the Company’s acting as underwriter. In acting as underwriter and/or financial advisor, the Company has put emphasis on selecting clients.

Prior to accepting any new clients, the Company will conduct a preliminary assessment and due diligence on the business potential as well as financial performance of the clients. The Company’s IB staff are well accustomed to relevant applicable law and regulations, and this

enables them to provide high-quality and accurate services to clients.

8888.... The Company ‘s business may be affected by an error or the misconduct of an The Company ‘s business may be affected by an error or the misconduct of an The Company ‘s business may be affected by an error or the misconduct of an The Company ‘s business may be affected by an error or the misconduct of an

employee that is difficult to check and preventemployee that is difficult to check and preventemployee that is difficult to check and preventemployee that is difficult to check and prevent

The Company’s business is highly dependent upon its reputation and the trust of its clients. Employees are regularly in direct contact with clients and have knowledge of, or

access to, the clients’ assets or information. Accordingly, when an employee does not carry out his or her duties in accordance with a client’s orders or acts beyond his or her authority

or does not act in compliance with the Company’s rules and regulations including its compliance manual or commits misconduct in managing client’s assets or uses the client’s information without permission or other actions that may harm client interests, the

Company’s reputation and the trust of other clients may be adversely affected. The Company may also become liable for the losses incurred by the clients in question.

In addition, certain actions may be made in breach of relevant laws or regulations and may result in the Company becoming liable to pay fines, losing its license or being subject to litigation, all of which may have a materially adverse effect on the Company’s

financial condition and result of operations. To deal with this risk, the Company has regularly monitored working activities of employees and will punish any employee who

violates these Company’s rules. Also, the Company established clear working rules, actions and procedures that its employees have to follow. In the Year 2012, there were no cases where the Company’s staff failed to comply with or violated applicable rules and

regulations that may cause detrimental effects to the Company’s operation.

9999.... The CompaThe CompaThe CompaThe Company operates its businesses under stringent laws and regulations, ny operates its businesses under stringent laws and regulations, ny operates its businesses under stringent laws and regulations, ny operates its businesses under stringent laws and regulations,

including regulations that impose liability on its operations that could have an including regulations that impose liability on its operations that could have an including regulations that impose liability on its operations that could have an including regulations that impose liability on its operations that could have an adverse effect on its results of operations and financial conditionadverse effect on its results of operations and financial conditionadverse effect on its results of operations and financial conditionadverse effect on its results of operations and financial condition

The securities business is strictly controlled by laws and regulations from

government authorities, the Office of the SEC and the SET. As a result, any establishment or change of government policy or of the supervisory roles of the relevant regulatory

bodies may affect the Company’s goals, competitiveness and business and could have a materially adverse effect on the business, financial condition and result of operations of the Company. Moreover, the Company may incur liabilities resulting from the operation of

its business, such as from mistakes arising from the performance of its duties as financial advisor or underwriter or from its failure to comply with steps in accepting securities

purchase or sales orders from clients. The Company cannot ensure that if the Company became liable, it would not face serious liability or a possible business license risk, either of which could have serious a material effect on its business and its reputation.




To mitigate this risk, the Company’s Internal Audit Department has closely monitored changes in laws and regulations relevant to the Company’s businesses, and will

closely control and check operations of each department in the Company to ensure they are in conformance with applicable laws and regulations. It will inform of changes in

relevant regulations to all involved departments.

In the Year 2013, there were no cases where the Company’s staff failed to comply with or violated applicable rules and regulations that may cause detrimental effects to the

Company’s operation.

10101010.... The Company is highly dependent on staffThe Company is highly dependent on staffThe Company is highly dependent on staffThe Company is highly dependent on staff

The Company relies on experienced, knowledgeable and skilled employees in its business operations. At present, in a highly competitive business, with a limited number of experienced and skilled staff, there is intense competition to recruit appropriate qualified

staff. Should the Company be unable to retain these staff, the Company’s business continuity may be affected to the detriment of its financial condition and result of

operations.

To counter this risk, the Company has provided its staff with good employee welfare, and long put emphasis on providing training courses for employees with the aim of

enhancing employee skills. In addition, the Company has allocated warrants for staff in order to attract a very qualified workforce to continue working for the Company over the

long term. In the Year 2013, the Company faced no problems regarding significant turnover of its staff.

11111111.... The Company’s operations are under the control of the major shareholderThe Company’s operations are under the control of the major shareholderThe Company’s operations are under the control of the major shareholderThe Company’s operations are under the control of the major shareholder

As at August 30, 2013, Maybank Kim Eng Holdings Limited, the Company’s major shareholder, held a 83.25% equity stake in the Company’s total paid-up shares. Thus,

Maybank Kim Eng Holdings Limited remains able to control shareholders’ resolutions in relation to key matters that are required by laws or articles of association of the Company to be passed by a majority vote of shareholders attending the meetings and entitled to

vote, except for matters that are required by laws or articles of association of the Company to be passed by a three-fourths vote of shareholders. Therefore, other shareholders may

not obtain sufficient votes to balance those of Maybank Kim Eng Holdings Limited. Nevertheless, the Company has appointed three independent directors that account for 33% of the Company’s Board of Directors. They are responsible for monitoring and

providing advice on the Company’s operations to ensure it has operated transparently and accurately.

Moreover, as a subsidiary of Kim Eng Holdings that has long been well known for its securities business with subsidiaries in Asia, Europe and the United States, MBKET has been widely accepted by retail and institutional trading clients for its expertise and

experience in the securities business.

Nevertheless, in the Year 2011, there was a major change in the shareholding

structure of Kim Eng Holdings Limited. Mayban IB Holdings Sdn Bhd which has been a part of Malayan Banking Berhad from Malaysia conducted a tender offer for a 100 % stake in




Kim Eng Holdings Limited. Such change, however, had no effect on management policy and all staff of the Company.

12121212.... The Effect from The Effect from The Effect from The Effect from the emergency situationsthe emergency situationsthe emergency situationsthe emergency situations

The Company, however, has put emphasis on managing any casualties that might

occur with its branches and clients. The Company developed and implemented plans related to safety standards. It also purchased casualty insurance that could cover any casualties resulted from many disasters with the amount of THB 150 million.

For the emergency situations such as the flood crisis in 2011, some of the Company’s branches located in the areas affected by the flood crisis were temporarily closed. To deal

with this problem, the Company implemented a business continuity plan by relocating all staff who worked in the area affected by the flood crisis to work at the Company’s headquarters. This allowed the Company to provide trading services to its clients

continuously.

♦♦♦♦Corporate InformationCorporate InformationCorporate InformationCorporate Information♦♦♦♦


Pages 19 Back to Content

♦Corporate Information♦

The Board of DirectorsThe Board of DirectorsThe Board of DirectorsThe Board of Directors Mr. Yuth Vorachattarn

Tengku Dato’ Zafrul Bin Tengku Abdul Aziz

(resigned w.e.f. 7 Nov 2013) Mr. Ronald Anthony Ooi Thean Yat

(resigned w.e.f. 7 Oct 2013) Mr. Montree Sornpaisarn Mrs.Hamidah Binti Moris

Ms. Boonporn Boriboonsongsilp Mr. Pusit Kaewmongkolsri

Assoc.Prof.Dr. Paiboon Sareewiwatthana

Assoc.Prof.Dr. Preecha Jarungidanan Corporate SecretaryCorporate SecretaryCorporate SecretaryCorporate Secretary

Mr. Waranchai Jensiriwanich AuditorAuditorAuditorAuditor

ErErErErnst & Young Office Limitednst & Young Office Limitednst & Young Office Limitednst & Young Office Limited 1. Ms. Ratana Jala Certified Public Accountant, Registration No.3734

2. Ms. Somjai Khunapasut Certified Public Accountant, Registration No.4499

3. Ms. Phuphun Charoensuk Certified Public Accountant, Registration No.4950

33rd Floor, Lake Rajada

Office Complex 193/136-137 New Rajadapisek Road Klongtoey, Bangkok 10110

Thailand

Tel : 66 (0) 2264 0777 Fax : 66 (0) 2264 0789 - 90

Email:[email protected]

Head OfficeHead OfficeHead OfficeHead Office 999/9 The Offices at Central World,

Fl.20th-21st, 24th Rama 1 Road, Patumwan, Pathumwan,

Bangkok 10330 Tel: 66 (0) 2658 6300 Fax: 66 (0) 2658 6301

Company Registration No.Company Registration No.Company Registration No.Company Registration No.

Bor Mor Jor 0107545000314 HomepageHomepageHomepageHomepage

www.maybank-ke.co.th

Securities RegistrationSecurities RegistrationSecurities RegistrationSecurities Registration Thailand Securities Thailand Securities Thailand Securities Thailand Securities Depository (Thailand) CoDepository (Thailand) CoDepository (Thailand) CoDepository (Thailand) Co., ., ., .,

Ltd.Ltd.Ltd.Ltd. 62 The Stock Exchange of

Thailand Building, Rachadapisek Road, Klongtoey, Bangkok 10110

Tel: 66 (0) 2359 1200

Company OfficesCompany OfficesCompany OfficesCompany Offices

• Bangkok and VicinitiesBangkok and VicinitiesBangkok and VicinitiesBangkok and Vicinities

Head OfficeHead OfficeHead OfficeHead Office 999/9 The Offices at Central

World, 20th-21st, 24th and 25th Fl.,

Rama I Road, Pathumwan, Pathumwan, Bangkok 10330 Tel: 66 (0) 2658 6300

Fax: 66 (0) 2658 6301

Ngamwongwan BranchNgamwongwan BranchNgamwongwan BranchNgamwongwan Branch 30/39-50 The Mall Ngamwongwan Office

Tower 14th Fl., Ngamwongwan Rd.,

Bang Khen, Nonthaburi 11000 Tel : 0-2550-0577

Fax : 0-2550-0566

SeaconSeaconSeaconSeacon Square BranchSquare BranchSquare BranchSquare Branch 55 Seacon Square Tower G Fl., Room 1005,

Srinakarin Rd., Nongbon, Pravej,

Bangkok 10260 Tel : 0-2320-3600 Fax : 0-2320-3610

Yada BranchYada BranchYada BranchYada Branch

56 Yada Tower 5th Fl., Silom Rd., Suriyawong, Bangrak, Bangkok 10500

Tel : 0-2632-8341 Fax : 0-2632-8395

Thapra BranchThapra BranchThapra BranchThapra Branch 99 The Mall Thapra

Office Tower 12 Fl., Ratchadapisek-Thapra Rd.,

Bukkaloe, Thonburi,

Bangkok 10600 Tel : 0-2876-6500

Fax : 0-2876-6531 Thaniya BranchThaniya BranchThaniya BranchThaniya Branch

52 Thaniya Plaza Tower 20th Fl., Silom Rd.,

Suriyawong, Bangrak, Bangkok 10500 Tel : 0-2231-2700 Fax : 0-2231-2130

Bangkhae BranchBangkhae BranchBangkhae BranchBangkhae Branch 275 The Mall Bangkhae

Tower 8th Fl., Petchkasaem Rd.,

North Bangkae, Bangkae, Bangkok 10160

Tel : 0-2804-4235 Fax : 0-2804-4251




Pratunam BranchPratunam BranchPratunam BranchPratunam Branch

553 The Palladium Building 14th Fl., Ratchaprarop Rd., Makkasan, Ratchathewi, Bangkok 10400

Tel : 0-2250-6192 Fax : 0-2250-6199 Pinklao BranchPinklao BranchPinklao BranchPinklao Branch 7/129 Central Pinklao Tower

3rd Fl. Room 302, Baromratchonni Rd.,

Arunamarin, Bangkok Noi, Bangkok 10700 Tel : 0-2884-9847

Fax : 0-2884-6920

PhPhPhPhahurad Branchahurad Branchahurad Branchahurad Branch 125, 125/1-6, 125/19-25 The Old Siam Plaza 3rd Fl.

Pahurad Rd., Wangburapapirom, Pranakorn, Bangkok 10200

Tel : 0-2225-0242 Fax : 0-2225-0523

Fortune BranchFortune BranchFortune BranchFortune Branch 5 Fortune Town Building,

Basement Fl., Ratchadapisak Rd., Dindaeng, Bangkok 10400 Tel : 0-2641-0977 Fax : 0-2641-0966

Future Park Rangsit BranchFuture Park Rangsit BranchFuture Park Rangsit BranchFuture Park Rangsit Branch 94 Future Park Rangsit Tower,

Room 091-92 GF Fl., Phaholyothin Rd., Prachatipat, Pathumthani

12130 Team 1 ; Tel : 0-2958-0592

Fax : 0-2958-0420 Team 2 ;

Tel : 0-2958-0992 Fax : 0-2958-0590

Fashion Island BranchFashion Island BranchFashion Island BranchFashion Island Branch

587,589, Fashion Island Shopping Center BF Fl., Ramintra Rd., Khan Na Yao,

Bangkok 10230 Tel : 0-2947-5800-5

Fax : 0-2519-5040 Kasetsart University Kasetsart University Kasetsart University Kasetsart University

BranchBranchBranchBranch 50 Faculty of Business

Adminstration 1st Fl., Ngamwongwan Rd., Lat Yao Chatuchak, Bangkok

10900 Tel: 0-2579-9880

Fax: 0-2579-9840 United Center BranchUnited Center BranchUnited Center BranchUnited Center Branch

323 United Center Building, 17th Fl., Silom

Rd., Bangrak, Bangrak, Bangkok 10500 Tel : 0-2680-4340 Fax : 0-2680-4355

Yaowaraj BranchYaowaraj BranchYaowaraj BranchYaowaraj Branch 215 Grand China Tower 4th Fl., Yaowaraj Rd., Samphantawong, Bangkok 10100

Tel : 0-2622-9412 Fax : 0-2622-9383 Lat Phrao BranchLat Phrao BranchLat Phrao BranchLat Phrao Branch

1693 Central Lat Phrao Tower 11th Fl. Phaholyothin Rd.,

Lat Phrao, Chatuchak, Bangkok 10900 Tel : 0-2541-1411

Fax : 0-2541-1108

Sri NakarinSri NakarinSri NakarinSri Nakarin BranchBranchBranchBranch 1145 Moo 5 Akepailin Tower 3rd Fl., Srinakarin

Rd., North Samrong, Samut Prakan 10270

Tel : 0-2758-7003 Fax : 0-2758-7248

Silom Branch Silom Branch Silom Branch Silom Branch

62 Thaniya Building 4th Fl., Silom Rd, Suriyawong, Bangrak, Bangkok 10500

Tel : 0-2231-2700 Fax : 0-2231-2130

Sathon BranchSathon BranchSathon BranchSathon Branch 92/10 Sathonthani Tower 2

7th Fl. North Sathon Rd., Silom, Bangrak, Bangkok

10500 Tel : 0-2636-7550-5 Fax : 0-2636-7565

Amarin Branch Amarin Branch Amarin Branch Amarin Branch

496-502 Amarin Plaza, 8th Fl. Ploenchit Rd., Lumpini, Pathumwan, Bangkok 10330

Tel : 0-2256-9373 Fax : 0-2256-9374

Asoke BranchAsoke BranchAsoke BranchAsoke Branch 159 Sermmit Tower 25th Fl.,

Soi Sukumvit 21, Asoke Rd., North Khlong Toei,

Watthana, Bangkok 10110 Tel : 0-2665-7000

Fax : 0-2665-7050

The Emporium BranchThe Emporium BranchThe Emporium BranchThe Emporium Branch 622 The Emporium Tower 14th Fl., Sukhumvit Rd.,

Klong Tun, Khlong Toei, Bangkok

10110 Tel : 0-2664-9800 Fax : 0-2664-9811

The Nine BranchThe Nine BranchThe Nine BranchThe Nine Branch

999/3 The Nine Neighborhood Center, 3rd Fl., Rama9 Rd., Suanluang,

Bangkok 10250 Tel : 0-2716-7816

Fax : 0-2716-7815




Bangkapi BranchBangkapi BranchBangkapi BranchBangkapi Branch 3105 N-Mark Plaza 3rd Fl. Ladpraw Rd. Klongchun, Bangkapi, Bangkok 10240

Tel: 02-378-1144

Tel: 02-378-1323 The Dhurakij Pundit The Dhurakij Pundit The Dhurakij Pundit The Dhurakij Pundit

University BranchUniversity BranchUniversity BranchUniversity Branch 110/1-4 Building 10, 1st Fl.,

Prachachen Rd., Laksi, Bangkok 10210 Tel : 0-2831-4600

Fax : 0-2580-3643

The Chaengwattana BranchThe Chaengwattana BranchThe Chaengwattana BranchThe Chaengwattana Branch 99/9 Central Plaza Chaengwattana Office Tower, 14th Fl., Unit1401 Chaengwattana Rd., Bangtarad, Pakkret, Nonthaburi 11120

Tel : 0-2835-3283 Fax : 0-2835-3280

Thanya Park BranchThanya Park BranchThanya Park BranchThanya Park Branch 735/5 Thanya Shopping Park,

E Building, 2nd Fl., Srinakarin Rd., Suanlaung, Prakhanong, Bangkok 10260

Tel. 0-2108-6300 Fax. 0-2108-6301

Phayathai BranchPhayathai BranchPhayathai BranchPhayathai Branch 71 Goldentown Building

4th Fl., Room 403, Phayathai Rd., Ratchatwewi

Bangkok 10400 Tel: 0-2251-4099 Fax: 0-2251-4098

**Opening Date: 24 Jul 2013 **Opening Date: 24 Jul 2013 **Opening Date: 24 Jul 2013 **Opening Date: 24 Jul 2013

All Seasons Place BranchAll Seasons Place BranchAll Seasons Place BranchAll Seasons Place Branch 87/2 CRC Tower, 3Fl., Room 311, Wireless Rd.,

Lumpini, Phatumwan, Bangkok 10330

Tel: 0-2658-0084 Fax: 0-2658-0094 **Opening Date: 24 Jul 2013**Opening Date: 24 Jul 2013**Opening Date: 24 Jul 2013**Opening Date: 24 Jul 2013

Thonglor BranchThonglor BranchThonglor BranchThonglor Branch 154 Anekvanich Building, 3rd Fl., Room C,

Sukhumvit Rd. 55, Thong Lor, Klongton-

Nua, Wattana, Bangkok 10110 Tel: 0-2714-9222

Fax: 0-2726-3901 **Opening Date: 4 Mar **Opening Date: 4 Mar **Opening Date: 4 Mar **Opening Date: 4 Mar

2013201320132013 Zen World BranchZen World BranchZen World BranchZen World Branch

4, 4/5 ZEN World Tower, 15th Fl., Room 1501

Ratchadamri Rd., Pathumwan, Bangkok 10330

Tel: 0-2658-6300 Fax: 0-2632-8395

**Opening Date: 28 **Opening Date: 28 **Opening Date: 28 **Opening Date: 28 Oct 2013Oct 2013Oct 2013Oct 2013

• Other ProvincesOther ProvincesOther ProvincesOther Provinces

Chonburi Branch Chonburi Branch Chonburi Branch Chonburi Branch 55/20 Moo 1, Soi Lungsong,

Behind CentralPlaza Chon Buri, Samed, Mueang, Chon Buri

20000 Tel. 038-053-950

Fax. 038-053-966 **Moving Date: 18 Mar **Moving Date: 18 Mar **Moving Date: 18 Mar **Moving Date: 18 Mar 2013201320132013

Chanthaburi BranchChanthaburi BranchChanthaburi BranchChanthaburi Branch

351/8, Tha Chalaep Road, Talad, Mueang, Chanthaburi 22000

Tel: 039-332-111 Fax: 039-332-444

Chiangmai 1 BranchChiangmai 1 BranchChiangmai 1 BranchChiangmai 1 Branch

244 Chiang Mai Golf Driving Range Building, 2nd-3rd Fl. Wowlai Rd. Haiya, Mueang Chiangmai 50100 Tel: 053-284-000

Fax: 053-284-019 Chiangmai 2 BranchChiangmai 2 BranchChiangmai 2 BranchChiangmai 2 Branch

201/3 Mahidol Rd., Haiya, Mueang,

Chiangmai 50100 Tel : 053-284-138-47 Fax : 053-202-695

Nakon Ratchasima Nakon Ratchasima Nakon Ratchasima Nakon Ratchasima

BranchBranchBranchBranch 1242/2 The Mall Department Store, 7th Fl., Room 3A,

Mittrapap Rd., Nai-Mueang, Mueang, Nakhon Ratchasima

30000 Tel: 044-288-455 Fax: 044-288-466

Phuket BranchPhuket BranchPhuket BranchPhuket Branch

1, 1/1 Thungkhar Rd., Talad Yai, Mueang, Phuket 83000

Tel: 076- 355-730 Fax: 076-355-730 Ext. 119

** Moving Date: 23 Dec 2013

Yala BranchYala BranchYala BranchYala Branch 18 Song Phee Nong Rd.,

Sateng, Mueang, Yala 95000 Tel : 073-255-494-6 Fax : 073-255-498 Rayong BranchRayong BranchRayong BranchRayong Branch

180/1-2 Samaphan Building, 2rd Fl., Sukumvit Rd., Cherng Nern, Mueang,

Rayong 21000 Tel : 038-862-022-9

Fax : 038-862-043




Rayong 2 BranchRayong 2 BranchRayong 2 BranchRayong 2 Branch

351-351/1, TSK PARK, 1st Fl., Sukumvit Rd., Nuarn Pra, Mueang, Rayong 21000

Tel : 038-807-459 Fax : 038-807-841

Lampang BLampang BLampang BLampang Branchranchranchranch 319 Central Plaza 3rd Fl.,

Highway Lampang-Ngao Road, Suan Dok, Mueang, Lampang

52100 Tel : 054-811-817 Fax : 054-811-816

Surin BranchSurin BranchSurin BranchSurin Branch

137/5-6 Sirirat Rd., Nai Mueang, Mueang, Surin 32000 Tel : 044-531-600-3 Fax: 044-519-378

Samut SakhonSamut SakhonSamut SakhonSamut Sakhon BranchBranchBranchBranch 322/91 Ekachai Rd., Mahachai, Mueang,

Samut Sakhon 74000 Tel : 034-837-190

Fax : 034-837-610 Samut Songkram BranchSamut Songkram BranchSamut Songkram BranchSamut Songkram Branch

74/27-28 Soi Bangjakreng 4, Rama 2 Rd., Mae Klong,

Maung, Samut Songkram 75000 Tel : 034-724-062-4 Fax : 034-724-068

Surat Surat Surat Surat Thani BranchThani BranchThani BranchThani Branch

216/3 Moo 4 Chonkasem Rd., Makhamtea, Mueang, Surat Thani 84000

Tel : 077-205-460 Fax : 077-205-475

Hat Yai 1 BranchHat Yai 1 BranchHat Yai 1 BranchHat Yai 1 Branch

1, 3, 5 Soi Juti Uthit 3, Juti Anusorn Rd. Hat Yai, Songkhla 90110

Tel : 074-346-400-5 Fax : 074-239-509

Ubon Ubon Ubon Ubon Ratchathani Ratchathani Ratchathani Ratchathani BranchBranchBranchBranch

311 Moo 7 Central Plaza Ubonrachathani, Room G3,

G Fl., Chaengsanit, Jae Ramae, Muang, Ubonratchathani 34000

**Moving Date: 19 **Moving Date: 19 **Moving Date: 19 **Moving Date: 19 Oct 2013 Oct 2013 Oct 2013 Oct 2013

Aranyaprathet BranchAranyaprathet BranchAranyaprathet BranchAranyaprathet Branch The Tesco Lotus

Aranyaprathet 2nd Fl., 559 Moo 1,

Banmainongsai Aranyaprathet, Sa Kaeo Tel : 037-541-731

Fax : 037-541-740 **Moving Date: 11 Jan **Moving Date: 11 Jan **Moving Date: 11 Jan **Moving Date: 11 Jan

2013201320132013 Hua Hin BranchHua Hin BranchHua Hin BranchHua Hin Branch

16/11 Petchkasaem Rd., Hua Hin, Prachuap Khiri Khan 77110

Tel : 032-531-193 Fax : 032-531-221 **Moving Date: 11 Jan 2013**Moving Date: 11 Jan 2013**Moving Date: 11 Jan 2013**Moving Date: 11 Jan 2013

Khonkean BranchKhonkean BranchKhonkean BranchKhonkean Branch

163/1-2, Klang Muang Rd., Opposite Municipality Market 1, Muang, Khon Kaen 40000

Tel : 043-225-355 Fax : 043-225-356

**Opening Date: 22 Feb 2013**Opening Date: 22 Feb 2013**Opening Date: 22 Feb 2013**Opening Date: 22 Feb 2013

Nakorn Sawan BranchNakorn Sawan BranchNakorn Sawan BranchNakorn Sawan Branch

1/15-16 Suchada Rd., Pak Nam Pho, Mueang, Nakorn Sawan 60000

Tel : 056-314-150 Fax : 056-314-151

**Opening Date: 26 Dec 2013**Opening Date: 26 Dec 2013**Opening Date: 26 Dec 2013**Opening Date: 26 Dec 2013 Online BranchOnline BranchOnline BranchOnline Branch

BTS Chongnonsee BranchBTS Chongnonsee BranchBTS Chongnonsee BranchBTS Chongnonsee Branch

Room No. S3-N, Chongnonsee BTS Station, Naradhiwas Rajanagarindra Rd., Silom,

Bangrak, Bangkok 10500 Tel : 09-1773-0209

Fax : 0-2658-6301 **Opening Date: 9 Oct 2013**Opening Date: 9 Oct 2013**Opening Date: 9 Oct 2013**Opening Date: 9 Oct 2013

BTS Saladaeng BranchBTS Saladaeng BranchBTS Saladaeng BranchBTS Saladaeng Branch Room S2-L, Saladaeng BTS

Station, Silom Rd., Silom, Bangrak, Bangkok 10500

Tel : 09-1773-0208 Fax : 0-2658-6301

**Opening Date: 9 Oct 2013**Opening Date: 9 Oct 2013**Opening Date: 9 Oct 2013**Opening Date: 9 Oct 2013 BTS Mo Chit BranchBTS Mo Chit BranchBTS Mo Chit BranchBTS Mo Chit Branch

Room N8-H, Mo Chit BTS Station, Phahonyothin Rd.,

Ladyao, Jatuchak, Bangkok 10900 Tel : 09-1773-0210

Fax : 0-2658-6301 **Opening Date: 9 Oct 2013**Opening Date: 9 Oct 2013**Opening Date: 9 Oct 2013**Opening Date: 9 Oct 2013

♦♦♦♦Shareholder Structure ♦♦♦♦



♦ Shareholder Structure ♦ 1111.... Share Capital of the CompanyShare Capital of the CompanyShare Capital of the CompanyShare Capital of the Company

As at December 31, 2013, the Company had a total registered share capital of Baht

2,861,250,000 with total paid-up capital of Baht 2,854,072,500 comprised of 570,814,500 ordinary shares at par value Baht 5 each.

2222.... ShareholdersShareholdersShareholdersShareholders

The Company’s major shareholder is Maybank Kim Eng Holdings Limited which holds 83.25 % of the Company’s total paid-up capital. The details on the Company’s shareholders as at August 30, 2013 being the latest book closing date are as follows:

No.No.No.No. NameNameNameName No. of Shares No. of Shares No. of Shares No. of Shares

HeldHeldHeldHeld

%%%%

1. MAYBANK KIM ENG HOLDINGS LIMITED 475,182,790 83.25

2. MR.THAWAT THEAWATTANASUK 8,492,100 1.49

3. MS.WANNAPORN HENSANGWILAI 5,294,300 0.93

4. MR.CHAWIN KRIRANANON 4,819,000 0.84 5. THAI NVDR CO.,LTD 2,350,433 0.41

6. MS.PIYASRI TANTIWATTANA 2,258,600 0.40

7. MAYBANK KIM ENG SECURITIES PTE. LTD. 1,440,800 0.25

8. BANGKOK LIFE INSURANCE PLC. 1,423,900 0.25

9. MRS.NANTHAYA APITHANOTHAI 1,244,500 0.22

10. CHASE NOMINEES LIMITED 50 1,238,000 0.22

11. OTHERS 67,070,077 11.75

TotalTotalTotalTotal 570,814,500570,814,500570,814,500570,814,500 100.00100.00100.00100.00

♦♦♦♦Shareholder Structure ♦♦♦♦



As at December 31, 2013, Maybank Kim Eng Holdings Limited is a wholly-owned

subsidiary of MAYBANK IB HOLDINGS SDN BHD

MAYBANK IB HOLDINGS SDN BHD is a company incorporated in Malaysia and is a

wholly-owned subsidiary of MALAYAN BANKING BERHAD.

As at December 31, 2013, MALAYAN BANKING BERHAD has 10,000,000,000 registered shares and paid up 8,440,046,735 common shares. Its top-10 major shareholders

as at 31 December 2013 are as follows:

No.No.No.No. NameNameNameName No. of Shares No. of Shares No. of Shares No. of Shares

HeldHeldHeldHeld

%%%%

1.

AmanahRaya Trustees Berhad

(B/O : Skim Amanah Saham Bumiputera) 3,386,987,458 38.22

2.

Citigroup Nominees (Tempatan) Sdn Bhd

(B/O : Employees Provident Fund Board) 1,188,790,137 13.41

3. Permodalan Nasional Berhad 504,806,080 5.70

4. Lembaga Kemajuan Tanah Persekutuan (FELDA) 186,179,241 2.10

5. Kumpulan Wang Persaraan (Diperbadankan) 170,726,559 1.93

6.


(B/O : Amanah Saham Wawasan 2020) 154,973,860 1.75

7.

Cartaban Nominees (Asing) Sdn Bhd

(B/O : Exempt AN for State Street Bank &

Trust Company (West Clt OD67))

144,967,475 1.64

8.


(B/O : Amanah Saham Malaysia) 136,847,470 1.54

9.

HSBC Nominees (Asing) Sdn Bhd

(B/O : BBH and Co Boston for Vanguard

Emerging Market Stock Index Fund)

84,196,968 0.95

10.

Cartaban Nominees (Tempatan) Sdn Bhd

(B/O : Exempt AN for Eastpring Investment Berhad)

83,834,188 0.95

Total top 10 major shareholdersTotal top 10 major shareholdersTotal top 10 major shareholdersTotal top 10 major shareholders 6,042,309,4366,042,309,4366,042,309,4366,042,309,436 68.1968.1968.1968.19

Remark: AmanaRaya Trustees Berhad holds the legal title to the Malayan Banking Berhad share as trustee for several unit trust funds. Investors in those

unit trust funds comprise the Malaysian public.

♦♦♦♦Dividend Payment Policy ♦♦♦♦



♦ Dividend Payment PolicyDividend Payment PolicyDividend Payment PolicyDividend Payment Policy ♦ The Company has the policy of making dividend payment at a rate not less than

40% of its net profit after deduction of all reserves as specified by the Company. Dividend

payment made each year depends upon the Company’s investment plan, necessity and situation in the future. The Board of Directors can propose the final dividend payment during its board meeting and present to shareholders during a shareholders’ meeting for

approval. The Board of Directors is authorized to decide an interim dividend payment, but need to inform the shareholders at the next shareholders’ meeting.

1

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. 1 000.00

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♦♦♦♦Good Corporate Governance Report♦

♦Annual Report 2013♦♦♦♦


♦Good Corporate Governance Report♦ The Board of Directors of Maybank Kim Eng Securities (Thailand) Plc. has long put

emphasis on good corporate governance. The Board of Directors believes that good corporate governance would help to prevent potential serious damages caused by the lack

of a good internal control system. Good corporate governance also plays an important role in enhancing management efficiency and improving the utilization of resources. This will

lead to sustainable growth for the Company and create value for all shareholders and stakeholders.

To be in compliance with good corporate governance as mentioned, the Company

has established CG Policy. The Policy has been approved by the Board of Directors and communicated to all employees throughout the Company. There is also a channel which

the Company can provide information regarding good corporate governance to all employees via Company’s Intranet.

For the Year 2013, the Company urged its employees to emphasize on instituting a

good corporate governance system in the organization. This was an ongoing activity from the Year 2008 that was the “Year of Good Corporate Governance in KIM ENG”. The

Company had urged all of its employees to act with thoroughness, care and integrity. The Company had also urged its management to set up an efficient, transparent and checkable management system. All of these have created confidence among shareholders, investors,

stakeholders and all involved persons. Thus, the Company was rated “4-Star” to “5-Star” for its good corporate governance since the Year 2009 until now.

Evaluation of the Company’s compliance with good corporate governance practices in Year 2013 indicates that the Company complied with almost all of the good corporate governance practices except that in the area of shareholders’ meeting. This was because

some foreign directors did not attend the shareholders’ meeting. Nevertheless, the Chairman, the Chief Executive Officer, the Chair of the Audit Committee, the Chair of the

Remuneration Committee, the Chair of the Nomination Committee and the Chair of the Good Corporate Governance Committee attended the shareholders’ meeting.

Details of the Company’s compliance with good corporate governance practices are as

follows:

Section 1 Shareholders’ Rights

The Board of Directors formulated a written corporate governance policy comprising policies on protecting the shareholders’ rights and encouraging shareholders to utilize their rights, including basic rights and extra rights, such as the rights to: receive

profit contribution in the form of dividends; obtain accurate, adequate and transparent information for making investment decisions; vote on major issues related to the Company;

express opinions in the shareholders’ meeting; participate in making decisions regarding

major changes in the Company; and electing directors. For the Year 2013, the Company fulfilled the rights of shareholders as follows:




1. Right to Receive Dividends

For the Year 2012, the Company made dividend payment at the rate of Baht 1.25 per share, or a payout ratio of 99.01% per year. Such payout ratio exceeded its specified dividend payout policy of at least 40% of the Company’s earnings after

deducting all required legal reserves. For the Year 2013, the Company made an interim dividend payment at the rate of Baht 0.35 per share, or a half year payout ratio of 22% per year.

2. Right to Attend the Shareholders’ Meeting

2.1 The Company allowed its shareholders to propose meeting agendas at

least 3 months prior to the date of the shareholders’ meeting via the Company’s website since October 15, 2012 to January 15, 2013.

2.2 The Company allowed its shareholders to submit questions approximately 1 month prior to the date of the shareholders’ meeting via its website since February 26, 2013 to March 22, 2013.

2.3 The Company notified shareholders of the resolutions from the meetings of the Board of Directors regarding date, time, place and meeting agendas 48 days prior to the date of general shareholders’

meeting via the SET ELCID system.

2.4 The Company informed its shareholders via the SET ELCID System that

it posted notice of its shareholders’ meeting on its website 32 days prior to the date of each meeting for thorough consideration. In addition, the clarifications and reasons of each agenda will be stated in the notice of

shareholders’ meeting.

The Company posted notice of the shareholders’ meeting, including

relevant information such as date, time, place, and meeting agendas, via its website 32 days prior to the date of meeting as the place for shareholders’ meeting has been prepared for the shareholders’

convenience of transport. In 2013, the Company arranged the place at Anoma Hotel, Rachadamri Road, Bangkok.

2.5 The Company requested Thailand Securities Depository Co., Ltd. (TSD), acting as the Company’s securities registrar, to mail notices of general shareholders’ meetings to all shareholders 15 days prior to the date of

each meeting and relevant documents are prepared both Thai and English versions to be enclosed with the Thai version of notice of

shareholders’ meeting.

2.6 The Company continually updated information on its website for thorough consideration by its shareholders.

2.7 The Board of Directors facilitated the shareholders’ rights to attend the shareholders’ meeting by prohibiting any acts that may limit or restrict

shareholders’ access to Company information or the general




shareholders’ meeting. No immediate changes in information provided during the meeting are to be made or ad-hoc meeting agendas

proposed. Shareholders who arrive late will be allowed to attend the shareholders’ meeting.

2.8 The chair of the meeting allowed shareholders convenient and adequate time to explain the process of voting and a mean to indicate the result before the meeting will be conducted including offer the

opportunities to the shareholders to raise their issues or question. Moreover, there will be the record of questions – answers and the result of voting for each agenda. In addition, the meeting allowed shareholders to express their opinion on each agenda item and ask questions at the shareholders’ meeting. However, there will be no

amendment of information or any change of agenda to the meeting. The Company disclosed minutes of the meeting for the shareholders’

review via its website. Details of the meeting could also be accessed via video posted on the Company’s website.

2.9 Prior to proceeding on the meeting agenda, the chair of the meeting

briefed the meeting process and voting method of each agenda to the shareholders so that they can properly and correctly execute their

rights and to ensure that the meeting process is in order and efficient.

2.10 The Board of Directors supports the adoption of technology for the meeting. Consequently, the meeting is conduct rapidly, accurately, and

precisely, for example Barcode scanner is used for the registration for shareholders.

2.11 In the shareholders’ meeting, the chairman of each sub-committee, namely the Chair of the Audit Committee, the Chair of the Nomination Committee, the Chair of the Remuneration Committee and the Chair of

the Good Corporate Governance Committee, attends the meeting. Shareholders are allowed to ask questions on relevant issues. The

Company had disclosed the minutes of the meeting for the shareholders’ review via its website. Details of the meeting can also be accessed via video posted on the Company’s website.

2.12 In the shareholders’ meeting, the chair of the meeting set an arrangement to have examiners for vote counting procedure, which

comprises of shareholders’ representative to witness the vote counting procedure in each agenda and disclose the result in the shareholders’ meeting minutes.

3. Right to Consider the Director’s Earnings and the Election of Directors

In 2013, the Company granted right for shareholders to evaluate the rate of

earning payment for all Directors with a thorough policy and methodology for consideration, which include a variety of earnings such as fixed salary, pension payment, committee meeting allowance, and any other types of benefit, etc.




For the Election of Directors, the Company proposed all Directors’ names to the shareholders for voting one by one so that they can make the right decision.

The voting result is announced and reported in the shareholders’ meeting minutes for shareholders’ acknowledgement.

4. Right to Receive Information and News about the Company.

The Company has long emphasized on disseminating information and news about the Company to its shareholders so that they would know the progress

and activities related to the business of the Company for their consideration. The Company disseminated information and news about its operation via the

ELCID System and its website. The Company disseminated accurate, quick, fair, reliable and timely information to all stakeholders.

In addition, the Company allowed its shareholders to submit questions

approximately 1 month prior to the date of the shareholders’ meeting via its website as well as establishing a forum called Opportunity Day for shareholders

and investors to receive any information and news about the Company. Further, the Company has Investor Relation unit to provide service and news about the Company to all investors.

Section 2 Fair and Equal Treatment to ShareholdersSection 2 Fair and Equal Treatment to ShareholdersSection 2 Fair and Equal Treatment to ShareholdersSection 2 Fair and Equal Treatment to Shareholders

In the Year 2013, the Company emphasized on the equal treatment of all shareholders with

no discrimination against any shareholders. The Company followed the SEC & the SET guidelines of good corporate governance practices. The Company’s general shareholders’ meeting #1/2013 was held on March 26, 2013 details as follows:

BeforBeforBeforBefore the Meetinge the Meetinge the Meetinge the Meeting

1. The Company requested Thailand Securities Depository Co., Ltd. (TSD), acting as the

Company’s securities registrar, to mail notices of general shareholders’ meetings to all shareholders 15 days prior to the date of each meeting and relevant documents are prepared both Thai and English versions to be enclosed with the Thai and English

version of notice of shareholders’ meeting.

2. The Board of Directors formulated a policy allowing minority shareholders who hold no more than 2% of total paid-up shares to propose additional meeting agenda items and names of persons to be elected as the Company’s directors, which is better than SET guidelines that allow only shareholders with a 5% stake to do so, via

its website 3 months prior to the date of the general shareholders’ meeting. For 2013, the Company allowed minority shareholders to propose additional meeting agenda

items and names of persons to be elected as Company directors via the Company website during the period between October 15, 2012 to January 15, 2013 (3 months prior to the AGM).

3. In the event that minority shareholders propose additional meeting agenda items; the Board of Directors will include such agenda(s) items in the shareholders’

meeting when it deems that such agenda(s) will benefit most shareholders.




However, for the 2013 AGM, no minority shareholders proposed additional meeting agenda items.

4. In cases where the minority shareholders propose the name of a person to be nominated as a director, the Nomination Committee will consider the qualifications

of the proposed person in accordance with the specified guidelines. In the Year 2013, none of the minority shareholders proposed the name of a person to be nominated as a director.

5. The Board of Directors allowed shareholders to submit questions in advance via the Company’s website prior to the date of the shareholders’ meeting. For the Year 2013, shareholders were allowed to submit questions from February 26, 2013 to March 22, 2013. Nevertheless, no questions were submitted by shareholders.

6. In cases where the shareholders cannot attend the meeting, the Company allows them to appoint a person or an independent director to vote on their behalf as a proxy. For the 2013 AGM, 185 shareholders delegated authority to vote on their

behalf.

7. The Company notified resolutions of the BOD meetings regarding date, time, place and meeting agendas 49 days prior to the date of the general shareholders’ meeting

via the SET ELCID system.

8. The Company informed its shareholders via the SET ELCID System that it has posted the notice of the shareholders’ meeting on its website 32 days prior to the date of the meeting for their thorough consideration.

9. The Company publicized the shareholders’ meeting information, including the date, time, place, and meeting agenda via its website 32 days prior to the date of the general shareholders’ meeting.

10. The Company asked Thailand Securities Depository (Thailand) Co., Ltd. (TSD), acting as the Company’s securities registrar, to mail the notice of the shareholders’ meeting to the shareholders 15 days prior to the date of the general shareholders’

meeting.

11. The Company posted a newspaper advertisement for at least three consecutive days prior to the date of the shareholders’ meeting to inform shareholders of the meeting.

On the Date of the MeetingOn the Date of the MeetingOn the Date of the MeetingOn the Date of the Meeting

1. The Company facilitates the meeting registration by using a computerized system to aid the registration process.

2. The Company holds the shareholders’ meeting on the date, at the time and in the place that is convenient for shareholders to attend specified in the notice of the shareholders’ meeting. There will be no short notice in relation to changes in the

meeting place to avoid shareholders not being able to attend the meeting.




3. The meeting chairman clarifies the quorum, explains the voting (one share per one vote), vote-counting and balloting procedures and clearly discloses voting results on

each agenda item.

4. There shall be no ad-hoc meeting on agenda items to be proposed by shareholders, who are the Company’s executives.

5. The chair of the meeting will convene the meeting in accordance with the order as specified in the notice of the shareholders’ meeting.

6. The chair of the meeting will allow shareholders to ask questions or express their views in a reasonable and adequate way.

7. The chair of the meeting will urge the use of balloting cards in each meeting agenda item for transparency in vote-counting results.

8. Each shareholder is allowed to exercise his/her rights in electing directors on an individual basis.

After the MeetingAfter the MeetingAfter the MeetingAfter the Meeting

1. The Company’s Secretary will be responsible for preparing the minutes of the shareholders’ meeting with opinions of and questions from shareholders. The minutes of shareholders’ meeting would be reviewed for accuracy by the Company’s

executives and the Chairman.

2. The Company will publicize the minutes of the shareholders’ meeting in both paper and video formats via its website 7 days after the date of the meeting, so that shareholders who did not attend the meeting, can check and acknowledge details of the meeting on an equal basis.

Preventive Policy regarding Use of Confidential InformationPreventive Policy regarding Use of Confidential InformationPreventive Policy regarding Use of Confidential InformationPreventive Policy regarding Use of Confidential Information

1. The Company has long realized that the use of confidential information by insiders is unfair to shareholders. Thus, the Company formulated a formal policy and asked for cooperation from its directors, management and employees that may be exposed to the Company’s non-public financial information not to trade the Company’s

securities 30 days prior to public dissemination of the Company’s quarterly financial performance. In the Year 2013, no directors, management and employees who may

be exposed to the Company’s non-public financial information violated the Company’s securities trading policy.

2. Directors and management are required to prepare disclosure reports of their securities holdings and changes in such holdings to the Office of the SEC in accordance with Section 59 of the Securities and Exchange Act. Directors and

management are also required to submit such disclosure reports to the Board of Directors. In the Year 2013, all directors and management were in full compliance with such reporting requirements.




3. Any directors and management with any potential conflict of interest with the Company are required to disclose such conflicts to the Board of Directors

immediately. No directors or management with potential conflict of interest are allowed to attend the meeting approving the transaction which the Company will

enter into with its interested persons. In the Year 2013, none of the directors and management had any potential conflict of interest with the Company.

3. The Company has a policy in which Audit Committee will consider any connected transactions or conflict of interest in order to ensure that such transactions reasonably occur to the best benefit of the Company.

Section 3 Rights and Roles of StakeholdersSection 3 Rights and Roles of StakeholdersSection 3 Rights and Roles of StakeholdersSection 3 Rights and Roles of Stakeholders

1. The Company shall treat all stakeholders including shareholders, employees, clients, competitors, creditors, the society and the environment fairly in accordance with

applicable laws and mutual agreements they have with the Company, taking into account their basic legal rights.

� Shareholders: Shareholders: Shareholders: Shareholders: The Company put emphasis on generating profitability to provide good investment returns to all shareholders. The Company’s dividend payment policy is to pay out at least 40% of net profit. The Company has encouraged

shareholders to exercise their legal rights and will treat all shareholders equitably. Shareholders shall have the right to receive accurate and updated information on the Company’s operations via its website on a regular basis. The

Company made dividend payment at the rate of Baht 1.25 per share, or a payout ratio of 99.01% per year. Such payout ratio exceeded its specified dividend

payout policy of at least 40% of the Company’s earnings after deducting all required legal reserves. For the Year 2013, the Company made an interim dividend payment at the rate of Baht 0.35 per share, or a half year payout ratio of

22% per year.

� Clients:Clients:Clients:Clients: The Company put emphasis on equal and fair treatment of all clients.

The Company has provided high-quality services to its clients, keeping their information confidential, and disseminated sufficient, accurate and timely information to them. The Company has provided a variety of products and

services and continued to improve and develop them to satisfy clients’ needs. In providing services, the Company takes into account the best interests of clients.

The Company’s investment consultants urged their clients to trade with care and thoroughness and consider all relevant information carefully and thoroughly prior to making their investment decisions, not emphasizing their trading

volume. This helps to prevent them from investing in manipulated stocks.

� Competitors:Competitors:Competitors:Competitors: The Company treated all of its competitors fairly and equally, and

strictly complied with mutual agreements and member agreements as applicable under the relevant SEC and SET rules and regulations and ASCO agreements, which the Company has set to its standard practice not to acquire any

investment consultants from other brokers in any inappropriate way.




� Creditors:Creditors:Creditors:Creditors: The Company fully complied with all conditions and terms under loan agreements and other agreements it entered into. The Company will never take

advantage of, and try to build trust and support with all stakeholders.

� Employees:Employees:Employees:Employees: The Company provided fair and equal treatment and fair compensation, taking into account its operating performance and

macroeconomic conditions, to its employees. The Company has provided its employees with good and safe working environments. The Company regularly

provides its employees with knowledge on new products and services. Back and front office employees are equipped with knowledge on new financial products and services so that they could continue to provide good services and products

to clients. In addition, the Company has set up the Safety and Ergonomics in the Work Place Committee as it values the importance of good and safety and

sanitation environment in the work place. In 2013, there was no evidence of employees who got injured or severe sickness due to working environment or during working hours. Further, in order for the Company to reasonably provide

fair compensation to all employees, the Company seizes the overall operation both short term and long term strategy. For short term strategy, the Company

oversees the ability of Company’s profit making on the annually basis and for the long term one, the Company assesses the Employees’ Balance Scorecard as well as establishing the Remuneration Committee. Last but not least, the Company

provides regular training to employees for good service with ultimate goal of effectiveness and efficiency and zero risk or few risks as possible. Also the

training could help employees to improve their capability and competency in career path.

� Society and environment:Society and environment:Society and environment:Society and environment: The Company regularly contributes to the good of

the society and the environment. Regarding contributions to the society, the Company has regularly provided knowledge on investment and savings so that a

solid financial foundation could be created for the Thai society. In regards to contributing to the environment, the Company engaged in many activities aimed to protect the environment and to support social and religious activities.

In the Year 2013, the Company complied with its policy to support social and environmental activities as follows:

A. Social ActivitiesA. Social ActivitiesA. Social ActivitiesA. Social Activities

1.1 Arranged the workshop in the topic of Primary Technical Analysis for University students of the Faculty of Economics and Finance, Thammasat

University on 20 February 2013.

1.2 Arranged the seminar for project of having the interns and University students of the Faculty of Economics and Finance, Chulalongkorn University as well as

11th grade high school students at Harrow International School in the topic of Investment Fundamental Requirement at E-Commerce Department, Maybank Kim Eng Securities (Thailand) Company Limited during the period of March 18,

2013 – August 23, 2013.




1.3 Arranged the seminar in the topic of Fundamental Analysis for University students, the University of the Thai Chamber of Commerce on August 5, 2013.

1.4 Arranged the seminar in the topic of Primary Technical Analysis for University

students, the University of the Thai Chamber of Commerce on August 19, 2013.

1.5 Arranged the seminar in the topic of Derivatives Warrant for University students, the University of the Thai Chamber of Commerce on August 19, 2013.

1.6 The Company’s management and staff together with Nanmeebooks Company Limited donated 200,000 Baht for building the bookshelves and donated books for the children in rural areas on October 14, 2013.

1.7 Arranged the seminar in the topic of Stock Investment Idea and Portfolio

Management for high school students at Harrow International School on October 16, 2013.

1.8 New Investors Program for Society: NIP-S Class 21 visited the Company at the

Board of Directors’ meeting room 20th floor and Trading Room 21st floor on October 28, 2013.

1.9 Arranged the seminar in the topic of Introduction to Stock Investment for

undergraduate students department of Financial Investment at Mahidol University International College on November 19, 2013.

B. Human Supporting ActivitiesB. Human Supporting ActivitiesB. Human Supporting ActivitiesB. Human Supporting Activities

1.1 The Company’s management and staff donated money for Maybank Kim Eng Indonesia staffs and people facing flood in Indonesia on January 30, 2013.

1.2 The Company’s management and staff donated blood in a charity drive held by CENTRAL Group of Companies with the National Blood Donor Center, Thai Red

Cross Society No.1/2013 on February 1, 2013.

1.3 The Company’s management and staff donated money for the Chaipattana Foundation on February 7, 2013.

1.4 The Company’s management and staff donated blood in a charity drive held by CENTRAL Group of Companies with the National Blood Donor Center, Thai Red Cross Society No. 2/2013 on May 3, 2013.

1.5 The Company’s management and staff donated blood in a charity drive held by CENTRAL Group of Companies with the National Blood Donor Center, Thai Red Cross Society No. 3/2013 on August 2, 2013.

1.6 The Company’s management and staff donated money for Low Vision Association on October 5, 2013.




1.7 Arranged a field trip to Kruthani Village at Patumthani province for the project called “Building a Wonderful World for Low Vision Kids” in corporation with the Low Vision Association on October 5, 2013.

1.8 The Company’s management and staff donated blood in a charity drive held by CENTRAL Group of Companies with the National Blood Donor Center, Thai Red Cross Society No. 4/2013 on November 1, 2013.

1.9 The Company’s management and staff donated money for Maybank Kim Eng Philippines staffs and people facing Typhoon Haiyan in Philippines on November 20, 2013.

C. Environment C. Environment C. Environment C. Environment

In the Year 2013, the Company had no disputes with any group of

stakeholders and was in full compliance with its operating policy.

2. The Board of Directors has formulated and implemented clear policies and procedures regarding potential fraudulent activities. Anyone who faces or sees

potential fraudulent activities must inform the Compliance Department of these and they will in turn report them to the Audit Committee. All complaints will be kept

confidential and the names of persons who make complaints will not be publicly disclosed. However, in Year 2013 there were no complaints in this area.

Section 4 Information Disclosure and TransparencySection 4 Information Disclosure and TransparencySection 4 Information Disclosure and TransparencySection 4 Information Disclosure and Transparency

The Company put emphasis on disclosing accurate, sufficient and timely financial data and other necessary information to the public and all stakeholders on a fair and equal

basis via various channels. In doing so, the Company did as follows:

1111.... Efficiency ofEfficiency ofEfficiency ofEfficiency of Information Disclosure Process in accordance with the Rules of Information Disclosure Process in accordance with the Rules of Information Disclosure Process in accordance with the Rules of Information Disclosure Process in accordance with the Rules of Listed Companies Listed Companies Listed Companies Listed Companies

The Company has disclosed information in accordance with relevant rules via the SET ELCID System, 56-1 Form, 56-2 Form (Annual Report) and its website

in both Thai and English. The Company continually updates such information. For the Year 2013, the Company strictly complied with relevant disclosure rules and was not penalized or sanctioned by relevant regulatory bodies due

to improper disclosure of information.

2222.... Quality of FiQuality of FiQuality of FiQuality of Financial Reportsnancial Reportsnancial Reportsnancial Reports

The Board of Directors prepared the Report regarding the Responsibility of the Board of Directors for Financial Reports that was accompanied by the Auditor’s Report in the Annual Report. This report is signed by the Chairman,

the Chief Executive Officer and the Chief Operating Officer. The Company has disclosed such information on the Company’s website.




3. Investor Relations3. Investor Relations3. Investor Relations3. Investor Relations

3.1 The Board of Directors has set up an Investor Relations Unit that is under the direct control of the Corporate Communications Department. The Investor Relations Unit is responsible for disseminating accurate, complete and timely

data and news regarding the Company’s activities to its shareholders, investors, securities analysts and the general public via various forms of media such as brochures, newspaper, radio, television, meetings and the

website. The Investor Relations Unit also assists shareholders in case they have difficulty contacting the Company. Investors can contact the Investor Relations Unit at

Phone No.0-2658-6300 ext. 7401 - 7402 or

by E-mail: [email protected] Contact Person:

Khun Tuenjai Jiarathanakul

3.2 In the Year 2013, the Company’s executives and the Investor Relations Unit provided the Company’s information via 2 meetings with local and foreign institutional investors, 4 meetings with investors, securities analysts and mass media during operating results periods and 2 times in the annual

operating plan announcements, public interview 6 times, as well as in 20 phone conversations.

Section 5 Responsibilities of the Board of DirectorsSection 5 Responsibilities of the Board of DirectorsSection 5 Responsibilities of the Board of DirectorsSection 5 Responsibilities of the Board of Directors

1111.... Composition of the Board of DirectorsComposition of the Board of DirectorsComposition of the Board of DirectorsComposition of the Board of Directors

1.1 The Board of Directors has 8 members comprising of:

� 3 executive directors

� 5 non-executive directors (4 of whom are independent directors)

The Company has long realized the importance of the appropriate composition of the Board of Directors, and nominates its directors in such a manner that there is a balance of power between executive and non-executive directors. The composition

of the Board of Directors is such that independent directors will work together with directors who represent the major shareholders and executive directors. The

number of independent directors accounts for more than one-third of the total no. of directors, thus being in line with the good corporate governance principles as prescribed by the SET. The Chairman is also an independent director. The number of

non-executive directors (5 persons) is higher than that of the executive directors (3 persons), so that independent directors can freely express their opinion and make

decisions, and the Board of Directors can perform their duties effectively.

The Board of Directors appoints one secretary to the Board of Directors and one company secretary. The names of directors, and duties and responsibilities of the

Board of Directors are shown in the topic “the Board of Directors and Management Structure”




1.2 The Board of Directors consists of experts in many fields who possess a variety of knowledge, capability, professional experience, business moral and

loyalty. They are willing to dedicate themselves to the good of the Company.

1.3 Each independent director has terms of holding office of 3 years each. Each

independent director cannot hold more than three terms, or more than 9 years. There is an exception to the rule when it is deemed by the shareholders or the Board of Directors that some directors play important

roles in the growth and success of the Company. In such cases, the terms of office of such directors can be extended as appropriate. The Company policy

regarding directors’ terms of office is clearly specified in its corporate governance policy.

1.4 The Board of Directors have specified qualifications of “Independent

Directors” that are in line with new rules and stricter that those required by the SEC and the SET. They are as follows:

� Holding shares of not more than 0.5% of all voting rights of the Company, any companies in the Maybank Group or its associated companies;

� Not being a member of management, employee, staff member or advisor who receives a regular compensation from the Company, or controlling person of the Company, any company in the Maybank Group and its

associated companies, or person with potential conflict of interest for at least one year prior to nomination;

� Having no business relationship or direct or indirect potential conflict of interest in terms of financial and general management of the Company, any company in the Maybank Group, its associated companies and other

persons with potential conflict of interest that may interrupt his independent discretion or opinion on the Company’s operations;

� Not being a person who has any legal registered relationship in the form of close relatives, major shareholders or controlling person of the Company, any company in the Maybank Group, its associated companies,

persons with potential conflict of interest, or persons who are nominated to take care of the interest of major shareholders.

1.5 No directors of the Company can hold a directorship in more than 5 other

listed companies including its affiliates which may be unlisted. In case it is necessary for any director of the Company to hold a directorship in more

than 5 other listed companies, he must obtain approval from the Board of Directors beforehand. Details regarding holding directorships of directors are disclosed in the topic “the Board of Directors and Management Structure”.

For 2013, no directors of the Company held directorships in more than 5 other listed companies including its affiliates which may be unlisted.

1.6 There has been a separation of the position between the Chairman and the Chief Executive Officer to create a check and balance mechanism, so that no




one has absolute power. The Company has clearly specified roles, powers and duties of each person; the Chairman shall be an independent director and the

leader in policy and corporate governance, and the Chief Executive Officer shall be the leader in corporate and business management.

1.7 In case of an expiry in terms for holding office of any director, the Company allows minority shareholders to propose name(s) or person(s) to be nominated as a director (s), provided that such person(s) has the

qualifications in line with the Company’s rules. When complete information about the person(s) proposed to be the Company’s director(s) is obtained,

the Nomination Committee will consider their qualifications prior to proposing at the shareholders’ meeting for nomination. For the Year 2013, no minority shareholders had proposed the name(s) of person(s) to be

nominated as the Company’s director(s).

2222.... The SubThe SubThe SubThe Sub----CommitteesCommitteesCommitteesCommittees

For transparency and independence in performing their duties, most members of the sub-committees are independent directors. Independent directors are appointed as the chair of each sub-committee. Details regarding sub-committees are stated under the

section titled “the Board of Directors and Management Structure”

3333.... Roles, Duties and Responsibilities of the Board of Directors Roles, Duties and Responsibilities of the Board of Directors Roles, Duties and Responsibilities of the Board of Directors Roles, Duties and Responsibilities of the Board of Directors

3.1 In the Year 2013, the Board of Directors considered and approved important matters in relation to the Company’s operations such as formulation of its vision, mission, strategy, financial objective, risk, operation plan and budget.

The Board of Directors supervised, controlled and monitored the management to ensure they have run the Company in accordance with the

specified policy and plan efficiently and effectively to enhance sustainable economic value for the Company, its shareholders and all stakeholders. Result of evaluation of the Company’s performance indicates that it could

still maintain a market share of not less than 10 %.

3.2 The Board of Directors communicated the Company’s strategy, objectives

and operating results to directors/executives/staff throughout the organization. The Company held a meeting to communicate its strategy, objectives and operating results to executives and management so that they

could communicate the message to the departments under their supervision. The Company also communicated important messages via its Intranet

System (Keplanet) and E-mail system.

3.3 The Board of Directors also formulated and approved the Company’s written policy on corporate governance. In October 2006, the Board of Directors

reviewed said policy. Evaluation of the Company’s compliance with good corporate governance principles indicated that the Company complied with

most of the principles, with details as discussed earlier.




3.4 The Board of Directors formulated a written business ethics and professional conduct to be used as reference by directors, executives and staff in

managing the Company’s business. Compliance with such written business ethics and professional conduct is closely monitored. For the Year 2011, no

market officers were found to have violated the specified Code of Conduct.

3.5 The Board of Directors developed and implemented a clear policy regarding conflict of interest. Good corporate governance policy shall be fully adhered

to and accurate information shall be disclosed.

3.6 The Board of Directors developed and implemented a risk management

policy for the entire organization. Risk management team shall monitor relevant risk factors and report to the Board of Directors every month, including risk review and assessment at least once a year.

3.7 The Board of Directors developed and implemented internal control and audit systems. The Board of Directors assigned and authorized Internal Audit

Department and Compliance Department to conduct audits and report results of the audits to the Audit Committee prior to reporting to the Board of Directors.

The Board of Directors has delegated and assigned sub-committees for any specific duties and responsibilities according to terms of reference (TOR).

Each TOR identifies name of committee, duty and responsibility, basic element such as meeting frequency, reporting line and committee’s self-evaluation as well as disclosing remuneration and compensation. Details of

remuneration and compensation made to directors are shown in the topic “the Board of Directors and Management Structure”

4444.... Meeting of the Board of Meeting of the Board of Meeting of the Board of Meeting of the Board of DirectorsDirectorsDirectorsDirectors

4.1 The Company’s secretary sets up a meeting schedule for the whole year in advance and informs each director of the meeting schedule so that they can

arrange their time to attend the meetings.

4.2 In the Year 2013, the Board of Directors’ meetings were held 7 times. Details of the Board meetings are stated under the topic “the Board of Directors and Management Structure”

4.3 The Chairman and the Chief Executive Officer will co-determine meeting agenda items to be proposed for the Board of Directors’ meeting. Each director could propose a meeting agenda item independently. Each director

may propose a meeting agenda to the Chairman via the company secretary or may propose a meeting agenda to the Board of Directors prior to the meeting.

4.4 Related documents will be sent to all members of the Board of Directors at least 7 days prior to the date of the meeting. For especially important




agendas, the relevant documents shall be submitted to directors prior to the meeting in adequate time for their consideration.

4.5 The Board of Directors can invite any relevant executive or personnel for inquiry during the meeting. In the Year 2013, it was found that executive directors are the persons who were in charge of the matters and knowledgeable of all relevant information. Thus, the Board of Directors inquired directly from the executive directors in charge of the matter.

4.6 After the Board of Directors’ meeting, the corporate secretary will arrange the minutes of the meeting and notify the related functions for their further

action and report the result of such actions to the Board again for their acknowledgement.

4.7 In each meeting, the Chairman allows each director to express his opinion extensively and freely. Thus, each director may express his opinion extensively and listen to others’ opinions. Each decision is made based on

sound rationale and thorough deliberation. Although the Chairman allows each director to express his opinion in the meeting extensively, each director presents his opinion concisely. Thus, it normally takes no more than 3 hours

on average to run the meeting, which the Board of Directors views as sufficient to consider each meeting agenda item thoroughly.

4.8 Good corporate governance reports must be approved by the Board of Directors. On October 18, 2007, the Board of Directors’ meeting reached a resolution to establish the Corporate Governance Committee that is

responsible for formulating good corporate governance principles, monitoring, evaluating and promoting compliance with the Company’s good

corporate governance principles.

Thus, the Good Corporate Governance Committee regarded the Year 2008 as “KIM ENG’s good corporate governance year.” The good corporate

governance campaign was initiated by various activities to persuade employees to be in compliance with good corporate governance principles.

5555.... SelfSelfSelfSelf----Evaluation by the Board of Directors Evaluation by the Board of Directors Evaluation by the Board of Directors Evaluation by the Board of Directors

5.1 The Board of Directors conducts self-evaluation once a year. Such self-evaluation will be conducted on an overall basis as well as one to one

session. Evaluation will be conducted on the following areas:

• Structure and Qualifications of the Board of Directors

• Roles, duties and responsibilities of the Board of Directors

• The Meeting of the Board of Directors

• Performance of Duties by the Board of Directors

• Relationship with Management




• Self-Development of Directors and Management Development

The company secretary is responsible for summarizing the results of evaluation before providing them to the Chairman. The Chairman will inform

the results to the meeting of the Board of Directors and consult with all of the directors to correct and improve any deficiencies or weaknesses found

from the evaluation.

5.2 For the Year 2012 Annual Performance, the Board of Directors conducted self-evaluation on May 9, 2013. Each area is evaluated by each director on a “fair” to “good” level. Year 2013 Annual Performance, the Board of Directors

conducted self-evaluation on Feb 11, 2014. Each area is evaluated by each director on a “good” to “excellent” level. For evaluation method the Company has specified criteria and process in which the Company ensures that there is

improvement in result as well as follows up on the status of prior evaluation.

6666.... Remuneration and CompensationRemuneration and CompensationRemuneration and CompensationRemuneration and Compensation

6.1 Directors’ remuneration and compensation are determined based on 4

criteria, namely 1) Comparison with the level of remuneration and compensation made to directors of other firms in the securities brokerage

business 2) Role and responsibility of each director 3) the Company’s overall operating performance and 4) Dividend payments made to shareholders. Director remuneration shall be considered by the Remuneration Committee

and proposed to the Board of Directors and meeting of shareholders. Details of remuneration and compensation made to directors are shown in the topic

“the Board of Directors and Management Structure”

6.2 Compensation and remuneration made to the Chief Executive Officer, is determined based on his duties, responsibilities, performance and the

Company’s operating performance, to be considered and approved by the Board of Directors. The Board of Directors evaluates the performance of the

Chief Executive Officer by comparing the stated operating goals and objectives on an annual basis. During any operating year, the Management will compare the Company’s actual operating performance with the stated

operating goals and objectives, and present the result of the comparison in each Board of Directors’ meeting and prior to preparing operating budgets

for the next year. The Board of Directors will evaluate the performance of the Chief Executive Officer on an annual basis.

7777.... Corporate GoveCorporate GoveCorporate GoveCorporate Governance Policy and Business Ethicsrnance Policy and Business Ethicsrnance Policy and Business Ethicsrnance Policy and Business Ethics

The Board of Directors has emphasized on good corporate governance. The Good Corporate Governance Committee was established to determine and specify monitoring

and evaluation guidelines and to promote implementation of, and compliance with, good corporate governance policies. The good corporate governance policies can be classified into 5 sections as follows:

• Shareholders’ Rights




• Equal Treatment to Shareholders

• Roles of Stakeholders

• Disclosure and Transparency

• Responsibilities of the Board of Directors

The Company has disseminated its good corporate governance policies via its website to

show its intent to operate under the good corporate governance practices to ensure its operation transparency. Employees are given a written good corporate governance manual

and urged to work ethically and be in compliance with good corporate governance policies.

In the Year 2013, compliance with good corporate governance policies was evaluated. The results of evaluation indicate that the Company was in compliance with most of the

specified guidelines and policies, except in the area of shareholders’ meeting. This was because some foreign directors did not attend the shareholders’ meeting. However, the

Chairman, the Chief Executive Officer, the Chair of the Audit Committee, the Chair of the Remuneration Committee, the Chair of the Nomination Committee and the Chair of the Good Corporate Governance Committee attended the meeting.

8888.... Internal Control and Audit SystemInternal Control and Audit SystemInternal Control and Audit SystemInternal Control and Audit System

The Board of Directors has put emphasis on having an efficient and effective internal

control system. Approval and operation authorities are developed in written form. Operations of the back and the front office are clearly segregated. The Internal Audit unit, which is under the direct control of the Audit Committee, shall monitor and ensure that the

Company has and is in compliance with the prescribed policies and guidelines regarding operating control, financial reporting, information technology as well as applicable rules

and regulations as required by competent authorities.

In addition, Maybank Malaysia Internal Audit Department shall monitor and ensure that the Company’s Internal Audit unit is in compliance with the prescribed policies and guidelines

stipulated by the Head Quarter. In 2013, there was always a representative from Maybank Malaysia Internal Audit Department to sit in the Audit Committee to provide comments

regarding the Company’s internal control and monitor report and acknowledge audit findings from all relevant audit agencies such as Maybank Malasia Internal Audit Department, Company’s external accounting auditor, Company’s internal audit unit, and

external regulators, i.e., SEC, etc.

The Company’s internal audit unit has set the annual audit plan to audit and control

Company’s operational procedures according to Risk Base Approach stipulated by Maybank Malaysia Internal Audit Department and is evaluated at least once a year. Sufficiency of internal control systems shall also be evaluated at least once a year as well. In the Year 2013,

the Company was in full compliance with its operating policies and applicable rules, regulations and guidelines as prescribed by the relevant authorities.




9999.... Conflict of InterestConflict of InterestConflict of InterestConflict of Interest

The Board of Directors set up a clear policy regarding consideration and approval of matters

that may cause conflict of interest. Directors shall disclose their conflict of interest prior to the meeting, if any. Directors are not allowed to attend or vote in the meeting should there

be a conflict of interest. In case there may be any transactions or matters with material conflict of interest, the Board of Directors may assign the Audit Committee to consider and propose their opinion to the Board of Directors. In case the Audit Committee has no

expertise in considering and providing their opinion regarding the transaction, the Board of Directors may assign an independent expert or the auditor to provide their opinions is

regarding the transaction for final consideration and approval by the Board of Directors or the shareholders’ meeting as the case may be. In the year 2013, there was 1 related transaction, and such transactions had been considered by the Audit Committee prior to

submitting the proposal to the Board of Directors for consideration. Such related transactions were disclosed in the financial statements.

10101010.... Risk Management PolicyRisk Management PolicyRisk Management PolicyRisk Management Policy

The Company may face both internal and external business risks in its operation. To deal with such risks, the Company has continually developed and implemented risk management

systems as follows:

Overview of Risk Management Overview of Risk Management Overview of Risk Management Overview of Risk Management

• Risk management at both policy and operating level shall be under the responsibility of each sub-committee.

• Operation of the Company is under the organizational structure, with check and balance mechanisms.

• Risk management policies and guidelines in each area are in written form for reference by management and employees.

The risk management system is developed on the basis of care and continual improvement,

taking into account the best interests of shareholders, clients, employees and the society.

Credit RiskCredit RiskCredit RiskCredit Risk

• Authority to extend margin loans is assigned to some authorized persons and committees. Margin loan extensions will be evaluated on an annual and case-by-

case basis.

• Create a unit that is independent from the Front Office to create check and balance mechanisms;

• In extending securities margin to trading clients, the Company will take into account the clients’ financial positions as well as collateral the clients put with the Company;




• The Company will not extend securities margin to risky clients. The Company

developed and implemented clear policies in evaluating and selecting the clients

to whom securities margin will be extended. Policies regarding initial margin and

marginable securities are also clearly specified.

• The Company has put emphasis on debt collection.

Market Risk: Market Risk: Market Risk: Market Risk: They can be classified into three categories, namely:

Price RiskPrice RiskPrice RiskPrice Risk

• This is the risk that the value of the Company’s investment portfolio may decline due to decline in the value of debt and equity securities the Company invests in. To deal with this kind of risk, the Company has

developed and implemented the so-called “Risk Management PoliRisk Management PoliRisk Management PoliRisk Management Policies cies cies cies and Guidelinesand Guidelinesand Guidelinesand Guidelines----Market RiskMarket RiskMarket RiskMarket Risk” with the aim to specify clear policies

regarding securities investment and market risk management. Such policies have specified roles, duties and responsibilities of directors and management regarding investment management, policies regarding

securities investment, investment risk diversification, investment loss limit and etc.

• The Company has also developed and implemented the so-called “risk ceiling level”, level of warning signs and stop-loss trigger actions.

Interest RatInterest RatInterest RatInterest Rate Riske Riske Riske Risk

• This is the risk caused by a mismatch between the time gap before interest rates can be reset (for floating-rate contracts) and the term of

contracts (for fixed-rate contracts). To deal with this risk, the Financial Department shall be responsible for monitoring changes and movements

in interest rates, as announced by many financial institutions, and report to the Chief Financial Officer and other involved officers. This will allow the Company to reset its interest rates in line with changes in market

interest rates.

Exchange Rate RiskExchange Rate RiskExchange Rate RiskExchange Rate Risk

• The Company has no material assets or liabilities denominated in foreign currencies.

Liquidity RiskLiquidity RiskLiquidity RiskLiquidity Risk

• In regard to management of liquidity risk, it is realized that NCR is an important tool for measuring and monitoring the Company’s liquidity risk. NCR is also used

in specifying the scope of transactions. Thus, the Risk Management Department is




assigned to be responsible for closely monitoring NCR figures as prepared by the Accounting Department.

Operational RiskOperational RiskOperational RiskOperational Risk

• As operational risk is embedded in every kind of risk, the Company thus put emphasis on this kind of risk and has developed and implemented some measures

to deal with it.

• The organizational structure with clear scope of authority and responsibility of each department and check and balance mechanisms are implemented.

• Standard working procedures in written form are developed and implemented, with the independent Compliance Unit, under the direct control of the Audit Committee, responsible for auditing tasks.

• Creation and implementation of Business Continuity Management (BCM) and Business Continuity Planning (BCP)

The Company has also mitigated and transferred operating risks via insurance policies initiated with well-known insurance firms with strong financial positions.

11111111.... Development of Directors and ExecutivesDevelopment of Directors and ExecutivesDevelopment of Directors and ExecutivesDevelopment of Directors and Executives

11.1 In the Year 2013, there were changes to the Board. The Company’s

secretary prepared the relevant documents and information that are important and necessary for the newly appointed director in acting in the capacity of directorship such as articles of association, rules and

regulations regarding roles and duties of directors as specified by competent authorities. Information related to the Company’s business

characteristics and operating philosophies would be provided to the newly appointed director so that she can understand her role and duty as a director and overview of the Company’s operations and scope of business.

11.2 The Company has prepared a succession plan for the Chairman and the Chief Executive Officer on both ad-hoc and permanent basis. On an ad-hoc

basis, other executives will act in such capacities on a temporary basis. On a permanent basis, the Nomination Committee will consider and appoint qualified personnel later.

11.3 The Company encourages and facilitates training and development for its staff. In 2013, it sent the Company’s secretary, Audit Committee’s

secretary, legal officers and compliance officers to attend a training course regarding corporate governance. The Company urged its directors to attend classes aimed at improving and developing their knowledge and

understanding the roles, duties and responsibilities of directors.

•

•

•

♦♦♦♦Internal Audit Control and Risk Management♦



♦♦♦♦ Internal Audit Control and Risk Management♦

In the Board of Directors’ Meeting No. 2/2014 on February 11, 2014 with also

comprises of three Audit Committees (which are Independent Directors of the Company). The Committee had evaluated the adequate of internal system control following to five key

issues which had been set out below:

� Organizational Control and Environment

� Risk Management

� Management Control Activities

� Information and Communication

� Monitoring

The Committee of the Company agreed that the Company has adequately in its important internal control system such as the roles and responsibilities of the Management

and staffs, discipline, the operation method or Code of Conduct. The Company also recognizes and promotes to have its system support to internal control operation referring to the objection of the Company. Moreover, the Company continuously operates its

consideration on type of risk, analyze the effects or opportunities that will be occurred and set up the procedure or policy to reduce the level of risk. The Company had set up the clear

authority, clearly separate the duty that will be supported to misconduct, set up the process of the business operating with major shareholders, directors, management or related persons.

The Company realizes on an importance of the communication, this is for more productivity of internal control system. The decision making of the company is made base

on the correct, real time and understandable information also with such good of data keeping. In addition, the Company has its audit and assessment from both internal and external organization. The Company has intention to continuously improve the procedure

according to the change of situation adequately. For the others internal control system issue, The Company agreed that currently, we have the adequately internal control system.

The Company also places an importance on the internal control system, and we had appointed the expertise and high experience person, Mr. Chuchart Suratepin, in the position of Head of Internal Audit Control since July 1, 2012.

Mr. Chuchart Suratepin has the high experience in term of internal audit control system, especially in the financial institute business similarity to the Company’s business

for over 11 years. He had attended the courses with respect to the internal control system such as (i) AML/CFT for auditor which was conducted by AMLO; (ii) FATCA experience conducted by Maybank; (iii) TEAMMATE for Audit Function conducted by Maybank; and (iv)

Internal Audit Planning Audits Methodologies conducted by Maybank, etc. In addition, he has clearly understood in the activities and operation of the Company.

♦♦♦♦Internal Audit Control and Risk Management♦



However, the consideration, appointment, impeachment and rotation of the Head of Internal Audit Control have to be approved and agreed by the Audit Committee.

Moreover, the Company had appointed Ms. Rungthip Kittanaseree as the Head of

Compliance for monitoring the Company operations to ensure that every transaction of the Company comply with the rules and regulation of the Government office. The main

responsibility is to be a centre of the Compliance function, monitor the operations of the Company to be in line with the laws, rules and regulations, policy and others related government offices such as Securities Exchange Commission (SEC), Stock Exchange of

Thailand (SET) or others relevant governments. The Board of Directors of the Company had approved the Compliance Policy, the policy was set up to ensure that every member which

comprise of the Board of Directors, Audit Committee, Management, Departments and staffs have to take their high responsibilities to comply with the laws, rules and regulation also with continuously communicate with the staffs to ensure that they have good

knowledge and well understand the law, rules and regulations and completely follow such policy.







)

♦Management Discussion and Analysis♦ ♦♦♦♦Annual Report for the Year 2013Annual Report for the Year 2013Annual Report for the Year 2013Annual Report for the Year 2013♦♦♦♦


♦Management Discussion and Analysis♦ Summary of Auditor ReportSummary of Auditor ReportSummary of Auditor ReportSummary of Auditor Report

Summaries of Auditor Report for the Years 2012 and 2013 are as follows:

Consolidated financial Consolidated financial Consolidated financial Consolidated financial statements and separate statements and separate statements and separate statements and separate

financial statements of the financial statements of the financial statements of the financial statements of the Company for the Year Company for the Year Company for the Year Company for the Year ended 31 December 2012ended 31 December 2012ended 31 December 2012ended 31 December 2012

Ms.Ratana Jala, Certified Public Accountant No. 3734 of Ernst

& Young Office Limited, express the opinion that the audited

financial statements present fairly, in all material respects,

the financial position of Maybank Kim Eng Securities

(Thailand) Public Company Limited and its subsidiary and of

Maybank Kim Eng Securities (Thailand) Public Company

Limited as at 31 December 2012, and their financial

performance and cash flows for the year then ended in

accordance with Thai Financial Reporting Standards.

Consolidated financial Consolidated financial Consolidated financial Consolidated financial statements and separate statements and separate statements and separate statements and separate

financial statements of the financial statements of the financial statements of the financial statements of the Company for the Year Company for the Year Company for the Year Company for the Year ended 31 ended 31 ended 31 ended 31 December 2013December 2013December 2013December 2013

Ms.Ratana Jala, Certified Public Accountant No. 3734 of Ernst

& Young Office Limited, express the opinion that the audited

financial statements present fairly, in all material respects,

the financial position of Maybank Kim Eng Securities

(Thailand) Public Company Limited as at 31 December 2013

and its financial performance and cash flows for the year

then ended, and the financial performance and cash flows of


Limited and its subsidiary for the year then ended in

accordance with Thai Financial Reporting Standards. The

auditor draws attention to Note 8 to the financial statements

regarding the change in accounting policy as the result of

adoption of Thai Accounting Standard 12 Income Taxes. The

auditor’s opinion is not qualified in respect of this matter.

Overview of the Company’s OperationOverview of the Company’s OperationOverview of the Company’s OperationOverview of the Company’s Operation

Maybank Kim Eng Securities (Thailand) Public Company Limited (formerly known as

“Kim Eng Securities (Thailand) Public Company Limited”) (the “CompanyCompanyCompanyCompany”) is a member of the Stock Exchange of Thailand No.42. It has been granted 4 types of securities business licenses, namely securities brokerage, securities dealing, investment advisory and securities

underwriting licenses. The Company has also engaged in other kinds of business that relate to and support securities business such as investment banking (financial advisory),



securities registrar and securities borrowing and lending. In addition, the Company was also granted by the Ministry of Finance a license to engage in the business of derivatives agent

in accordance with the Derivatives Act B.E. 2546 (2003). The Company was selected to be a member of Thailand Futures Exchange (TFEX) as well as a member of Thailand Clearing

House (TCH) to engage in the business of derivatives trading. Over the last several years, a major portion of the Company’s revenue came from securities brokerage business.

The Company has provided securities trading service and other related services to

domestic individual and institutional investors as well as foreign ones. The Singapore-based Maybank Kim Eng Holdings Limited is the Company’s major shareholder, holding in

aggregate 83.25% of the Company’s total paid-up shares. May Bank Kim Eng Holdings Limited has also held stakes in many other securities companies which are members of well-recognized stock exchanges around the globe, allowing it to create and maintain

strong worldwide network in the securities business.

In the Year 2011, there was a major change in the shareholding structure of Maybank

Kim Eng Holdings Limited. Maybank IB Holdings Sdn Bhd, a company in the group of Malaysia-based Malayan Banking Berhad, conducted a tender offer to acquire all shares of Maybank Kim Eng Holdings Limited. This allows Maybank IB Holdings Sdn Bhd to hold a

100% ownership in Maybank Kim Eng Holdings Limited. Nevertheless, such change has no effect on the Company’s business and human resources management policies.

For the Years 2012 and 2013, the Company’s total revenues were THBT 3,233.32 and THB 4,756.40 million consecutively. The Company’s total net profits for the Years 2012 and 2013 were THB 736.02 and THB 1,420.54 million respectively.

The Company’s market shares in the domestic securities brokerage business in the

Years 2012 and 2013 were 11.86% and 11.54% of total trading value in each respective year. As

of 31 December 2013, the Company’s total assets, liabilities and shareholders‘ equity as

showed on the Company’s separate statement of financial position were THB 14,684.97,

THB 9,409.29 and THB 5,275.68 million consecutively. A major component of the Company’s

assets is securities and derivatives business receivables, the amount of which directly

relates to trading volume during the last 3 trading days prior to the end of the year. In case

total trading volume significantly rises during such period, so does the amount of securities

and derivatives business receivables. Thus, significant rise/decline in the Company’s assets

as a result of rise/fall in the amount of securities and derivatives business receivables does

not truly reflect material change in the Company’s financial performance and position

during the year. As of 31 December 2013, major components of the Company’s liabilities

include securities and derivatives business payables, loans from financial institutions and

debt issued and borrowings.



The Company’s Competitive The Company’s Competitive The Company’s Competitive The Company’s Competitive StrengthsStrengthsStrengthsStrengths

• The Company has maintained its position as the No.1 securities brokerage firm in

Thailand in terms of market share for 12 consecutive years from 2002 to 2013:

1. Total branches across the country (excluding the headquarter) are 54. As of 31 December 2013, the Company’s total securities trading accounts were

143,000, thus allowing the Company to manage operating costs efficiently.

2. As of 31 December 2013, the Company’s total securities marketing officers were 701, and this is the largest securities marketing team in Thailand.

• Total shareholders’ equity on the Company’s separate statement of financial position was THB 5,275.68 million. As of 31 December 2013, the Company’s NCR stood at 47.99%. The Company has an investment banking team which consists

of 13 staffs. They are responsible for the financial advisory and securities underwriting businesses. The Company has provided financial advisory services

which cover various areas including company listing on a stock exchange, privatization, securities issuance, business/corporate takeover and independent financial advisory Over the last several years, the Company was appointed to act

as the lead underwriter or the co-underwriter for well-recognized corporate clients such as BMCL, ITD, SATTEL, SIAM GAS, MJD, DTAC, BTS, ETG, CPN and

etc. The Company was also appointed to act as the financial advisor in the areas of securities valuation, M&A, EJIP and etc.

• The Company’s securities research team consists of 29 staffs who have

conducted securities research in the area of fundamental, technical and economic analysis.

• The Company’s management team consists of knowledgeable executives with

proven track record and experience in the securities brokerage business.

Operating ResultOperating ResultOperating ResultOperating Result

In the Year 2013, the Company changed its accounting policy as a result of adoption

of Thai Accounting Standard 12 Income Taxes. Thus, its financial statements for the year ended 31 December 2013 was restated, resulting in the decrease in the amount of corporate

tax for the Year 2013 and increase in the amount of net profit of THB 5.5 million. The Company also reclassified an item on its 2012 statement of comprehensive income for comply to accounting standard by reclassifying the item of operating loss of the subsidiary

as loss from discontinued operation. This is because the Company divested its investment in Maybank (Thailand) Asset Management Company Limited (formerly known as Kim Eng

(Thailand) Asset Management Company Limited) on 21 March 2013.

�� Total RevenueTotal RevenueTotal RevenueTotal Revenue

The Company’s revenue consists of brokerage fee, fee and service income, gain

(loss) on investments, gain (loss) on derivatives, interest and dividend revenue, interest on



margin loan and other revenue (i.e. share transfer fee, interest on loan to employees and etc.). Main source of the Company’s revenue comes from brokerage fee. For the Year 2013,

brokerage fee (from both securities and derivatives businesses) accounted for 75% of the Company’s total revenue. Most of the Company’s securities trading clients are retail

investors. Their trading volume accounted for 85-95% of the Company’s total trading volume. Institutional investors accounted for 5-15% of the Company’s total trading volume.

For the Year 2013, the Company’s total revenue was THB 4,756.40 million, an

increase by more than THB 1.500 million compared to that of the preceding year. Such significant increase in revenue is a result of strong rise in brokerage fee of more than THB

1.100 million in the Year 2013 relative to that in the Year 2012 thanks to strong trading activities during the year (especially during the first half of the year).

�� Brokerage FeeBrokerage FeeBrokerage FeeBrokerage Fee

In the Year 2013, the Company achieved a total brokerage fee of THB 3,349.58 million, a robust growth compared to that of the preceding year which was THB 2,256.10

million. In the Year 2013, the Company had a brokerage fee from derivatives business of THB 268.99 million, a slight increase relative to that of the preceding year which was THB 264.97 million. Significant rise in the Company’s brokerage fee in the Year 2013 (including

brokerage fee from both securities trading and derivatives businesses) was contributed to robust trading activities during the year (especially during the first half of the year).

�� Other RevenueOther RevenueOther RevenueOther Revenuessss (not including brokerage fee)(not including brokerage fee)(not including brokerage fee)(not including brokerage fee)

The Company’s other revenues (not including brokerage fee) include fee and service income, gain (loss) from securities and derivatives trading, interest and dividend revenue,

interest on margin loans and others. During the Year 2013, fee and service income, gain from derivatives trading, interest and dividend revenue, interest on margin loans, gain from

divestment of a subsidiary and other revenues were THB 72.05, 179.06, 329.49, 636.22, 18.62 and 80.00 million consecutively.

�� Doubtful DebtsDoubtful DebtsDoubtful DebtsDoubtful Debts

The Company has classified securities business receivables and derivatives business receivables in accordance with the relevant notification issued by the Office of the Securities

and Exchange Commission re: Accounting for Doubtful Debts of Securities Brokerage Companies. It has reserved allowance for doubtful debts on a fully basis for all doubtful debts.

As of 31 December 2013, the Company’s total substandard debts stood at THB 260.08 million. The Company ceases to realize any revenue related to such doubtful debts.

Most of the Company’s substandard debts relate to margin loans for the amount of THB 255.48 million extended by Nithipat Securities Company Limited before the advent of Maybank Kim Eng Holdings Limited. The Company tries to collect such debts as fast as it

can. In case the Company cannot collect such debts, it will file a petition to the court and take further necessary actions. The remaining doubtful debts of THB 4.60 million are those



that occurred after the advent of Maybank Kim Eng Holdings Limited thanks to the Company’s careful selection of margin loan clients and stringent credit policy.

�� ExpensesExpensesExpensesExpenses

For the Year 2013, the Company’s expenses totaled THB 2,970.23 million, an increase

from that of the preceding year which stands at THB 2,259.03 million. Such increase were mainly due to rise in financing costs associated with borrowings from financial institutions and debt issuance which are incurred to support extension of margin loans and increase in

personnel expenses to compensate securities marketing officers.

�� Net ProfitNet ProfitNet ProfitNet Profit

For the Year 2013, the Company’s net profit totaled THB 1,420.54 million, a sharp increase by THB 736.02 million from that in the Year 2012. In the Year 2013, total revenue rose by more than THB 1,500 million whereas total expenses (not including corporate

income tax expense) rose by more than THB 700 million. Corporate income tax expense rose from THB 238.27 million in the Year 2012 to THB 365.63 million in the Year 2013 thanks

to strong surge in securities brokerage fee from THB 2,256.10 million in the Year 2012 to THB 3,349.58 million in the Year 2013.

Financial PositionFinancial PositionFinancial PositionFinancial Position

• AssetsAssetsAssetsAssets

Total assets at the end of the Year 2012 and the Year 2013 were THB 14,019.71 and THB 14,684.97 million consecutively. A major portion of the Company’s assets are securities

and derivatives business receivables which may vary in accordance with trading volume during the last 3 trading days of each fiscal year.

As at 31 December 2012, the Company’s assets totaled THB 14,019.71 million. A major portion of which was securities and derivatives business receivables, accounting for 83.29% of total assets on that date.

As at 31 December 2013, the Company’s assets totaled THB 14,684.97 million. A major portion of which was securities and derivatives business receivables, accounting for

86.10% of total assets on that date.

• Securities and Derivatives Business Receivables Securities and Derivatives Business Receivables Securities and Derivatives Business Receivables Securities and Derivatives Business Receivables

As of 31 December 2013, the Company’s net securities and derivatives business receivables (plus accrued interest receivables) totaled THB 12,643.35 million, an increase

from that at the end of the Year 2012 which was THB 11,676.88 million. Such increase was due to surge in trading activities in the Year 2013 relative to that of the preceding year

thanks to economic recovery and improving domestic political situation (especially during the first half of the year). As of 31 December 2013, securities and derivatives business receivables composed of:



o Securities business receivables-cash accounts with the total amount of THB 2,312.27 million, accounting for 18.30% of total securities business receivables

and accrued interest receivables-net. Outstanding balance of securities business receivables-cash accounts declined by 16.60% from that at the end of

the preceding year. This is because total trading volume during the last 3 trading days of the Year 2013 is lower than that during the last 3 trading days of the Year 2012.

o Securities business receivables-margin accounts with the total amount of THB 10,119.92 million, accounting for 80.10% of total securities business receivables

and accrued interest receivables-net. Outstanding balance of securities business receivables-margin accounts increased by 15.31% relative to that at the end of the Year 2012. This is because the Company continued to extend margin

loans in response to active trading activities during the year.

o Other receivables which are overdue receivables. As of 31 December 2013, the

outstanding amount of which was THB 245.80 million, a slight decline from that of THB 246.86 million at the end of the preceding year. Most of such overdue receivables are receivables under the old margin loans system.

o Securities borrowing receivables with the outstanding amount of THB 152.22 million as of 31 December 2013. This is an increase from the outstanding

amount of THB 82.27 million at the end of the Year 2012.

o Derivatives business receivables of THB 9.37 million as of 31 December 2013. This is an increase from the outstanding amount of THB 6.18 million at the end

of the Year 2012.

• Investment in SecuritiesInvestment in SecuritiesInvestment in SecuritiesInvestment in Securities

The Company’s net investment in securities as of 31 December 2013 totaled THB

34.78 million. Such investment in securities consists of equity trading securities with the net value of THB 17.65 million and general investment with the net value of THB 17.13 million.

• Investment in SubsidiaryInvestment in SubsidiaryInvestment in SubsidiaryInvestment in Subsidiary

As of 31 December 2013, the Company had no investment in subsidiary. On 21 March 2013, the Company sold a 99.99% subsidiary to Maybank Asset Management Group Berhad which is a company in the Maybank Group for the amount of THB 51 million. The Company

recognized no gain on sale of investment on its separate financial statements (recognizing gain on sale of investment of THB 19 million on its consolidated financial statements).

• Receivables from Clearing HouseReceivables from Clearing HouseReceivables from Clearing HouseReceivables from Clearing House

As of 31 December 2013, the Company’s receivables from clearing house totaled THB 318.69 million, a decrease from that of THB 1,245.13 million as of 31 December 2012.



• EquipmentEquipmentEquipmentEquipment

As of 31 December 2013, the Company’s net equipment totaled THB 221.45 million,

an increase from that of THB 154.58 million as of the end of the Year 2012. Most of the equipment is fixtures and computer equipment.

• Other AssetsOther AssetsOther AssetsOther Assets

The Company’s other assets include clearing fund, unearned revenue, prepaid

expenses and others. Their combined book value as of 31 December 2013 was THB 170.09 million, an increase from that of THB 145.22 million as at the end of the Year 2012. Such

increase was contributed mainly to increase in clearing fund and unearned revenue.

• LiquidityLiquidityLiquidityLiquidity

For the Year 2013, the Company had a net cash flow used in operating activities of

THB 700.13 million. Major uses of operating cash flows during the year were an increase in securities and derivatives business receivables and a decrease in securities and derivatives business payables.

For the Year 2013, the Company had a net cash flow from investing activities of THB 857.36 million. Major source of the Company’s investing cash inflow is interest cash receipt.

In the same year, the Company’s net investment in equipment and intangible assets totaled THB 130.88 million. During the Year 2013, the Company received a proceed from sale of a subsidiary for the amount of THB 26.71 million on consolidated financial statements (THB

50.69 million on the separate financial statements).

For the Year 2013, the Company generated a net cash flow from financing activities

of THB 414.47 million. Major source of the Company’s financing cash inflow is borrowings from domestic and foreign financial institutions. Major uses of the Company’s financing cash flow are loan repayments and dividend payment.

In assessing the Company’s liquidity, we should take into account its capability to maintain NCR in accordance with the rules as stipulated by the Office of the SEC. Over the

last 3 years (2011-2013), the Company was able to NCR at the rate of higher than 7% which is the minimum requirement by the Office of the SEC. This demonstrates that the Company was able to generate and maintain sufficient liquidity for its operation. For the Years 2011,

2012 and 2013, the Company’s NCR fell in the range of 41.82-154.76%, 43.75-138.92% and 21.54 – 57.41% consecutively. Note that NCR may vary from time to time due to changes in

securities trading volume, securities underwriting commitment and etc.

• Sources of CapitalSources of CapitalSources of CapitalSources of Capital

As of 31 December 2013, the Company’s total debt and total equity as showed on the

audited statement of financial position were THB 9.409.29 and THB 5,275.68 million respectively. The Company’s D/E ratios as of 31 December 2011, 2012 and 2013 were 0.62, 2.08 and 1.78 times consecutively. Two major portions of the Company’s debt are securities

and derivatives business payables that may vary from time to time in accordance with



securities trading volume during the last 3 trading days of each year and borrowings from financial institutions, debt securities and other loans. Readjusted D/E ratios of the

Company (excluding securities and derivatives business payables) as of 31 December 2011, 2012 and 2013 are 0.31, 1.21 and 1.23 times consecutively. It is worth noting that significant

increase in the Company’s total debt in the Year 2013 was due to incurrence of borrowings from domestic and foreign financial institutions and issuance of new debts to extend margin loans to securities trading clients.

The Company’s ROEs for the Years 2012 and 2013 are 16.60% and 29.45% respectively. For the Years 2012 and 2013, the Company made total dividend payments of

THB 500.29 and 879.23 million consecutively.

Factors that may significantly affect the Company’s financial performance and Factors that may significantly affect the Company’s financial performance and Factors that may significantly affect the Company’s financial performance and Factors that may significantly affect the Company’s financial performance and position in the futureposition in the futureposition in the futureposition in the future

Domestic economic and political situations may affect the Company’s financial performance and position. Factors such as change in interest rates, hike in oil prices,

political uncertainty, act of terrorism, monetary policy as prescribed by the Bank of Thailand as well as domestic and global economic situations, all of which may jointly work to affect investment confidence in domestic and international markets.

Risk due to change in price of securities the Company has held may affect the Company’s performance. Investment diversification would help to reduce this risk.

Settlement risk, trading error risk as well as financial risk, all of which will jointly work to affect the Company’s financial position. The Company will control those risks to be at an acceptable level.

• Future TrendFuture TrendFuture TrendFuture Trend

Domestic political unrest which has prolonged since Q.4 of 2013 as well as uncertain and fragile global economic recovery will affect long-term domestic economic recovery,

new business opportunities and profitability of domestic listed firms in the medium and long-run, thus making investments in SET-listed firms less interesting. This will adversely

affect trading activities on the SET as well as performances of the Company and other securities brokerage firms. To ensure its long-term competitiveness, the Company has a policy to continuously develop its human resources to ensure its readiness for new

businesses and apply new technology to achieve operating efficiency and effective cost management. The Company has a policy to maintain its leadership in the domestic

securities business by providing fully-integrated securities brokerage services and to support continuous development of the Thai capital market.


Limited and its subsidiary

Report and financial statements

31 December 2013

Independent Auditor's Report

To the Shareholders of Maybank Kim Eng Securities (Thailand) Public Company Limited

I have audited the accompanying financial statements of Maybank Kim Eng Securities (Thailand)

Public Company Limited, which comprise the statement of financial position as at 31 December

2013, and the related statements of comprehensive income, changes in shareholders’ equity and

cash flows for the year ended, and a summary of significant accounting policies and other

explanatory information and have also audited the consolidated statements of comprehensive

income and cash flows of Maybank Kim Eng Securities (Thailand) Public Company Limited and

its subsidiary for the same period.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements

in accordance with Thai Financial Reporting Standards, and for such internal control as

management determines is necessary to enable the preparation of financial statements that are

free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

My responsibility is to express an opinion on these financial statements based on my audit. I

conducted my audit in accordance with Thai Standards on Auditing. Those standards require that

I comply with ethical requirements and plan and perform the audit to obtain reasonable assurance

about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and

disclosures in the financial statements. The procedures selected depend on the auditor's

judgment, including the assessment of the risks of material misstatement of the financial

statements, whether due to fraud or error. In making those risk assessments, the auditor

considers internal control relevant to the entity's preparation and fair presentation of the financial

statements in order to design audit procedures that are appropriate in the circumstances, but not

for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An

audit also includes evaluating the appropriateness of accounting policies used and the

reasonableness of accounting estimates made by management, as well as evaluating the overall

presentation of the financial statements.

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for

my audit opinion.

Opinion

In my opinion, the financial statements referred to above present fairly, in all material respects,

the financial position of Maybank Kim Eng Securities (Thailand) Public Company Limited as at

31 December 2013 and its financial performance and cash flows for the year then ended, and the

financial performance and cashflows of Maybank Kim Eng Securities (Thailand) Public Company

Limited and its subsidiary for the year then ended in accordance with Thai Financial Reporting

Standards.

Emphasis of matter

I draw attention to Note 8 to the financial statements regarding the change in accounting policy as

the result of adoption of Thai Accounting Standard 12 Income Taxes. My opinion is not qualified in

respect of this matter.

Ratana Jala

Certified Public Accountant (Thailand) No. 3734

Ernst & Young Office Limited

Bangkok: 11 February 2014

Maybank Kim Eng Securities (Thailand) Public Company Limited and its subsidiary

Statement of Financial Position

As at 31 December 2013

(Unit: Baht)

Consolidated financial statements

Note 31 December 2012 1 January 2012 31 December 2013 31 December 2012 1 January 2012

(Restated) (Restated) (Restated) (Restated)

Assets

Cash and cash equivalents 9 301,264,070 436,944,122 872,971,184 271,776,475 373,414,466

Deposits at financial institutions 10 3,450,759 3,446,674 3,518,611 3,450,759 3,446,674

Receivables from Clearing House 11 1,245,125,890 178,179,476 318,690,445 1,245,125,890 178,179,476

Securities and derivatives business receivables 12 11,676,878,218 5,870,370,914 12,643,349,967 11,676,878,218 5,870,370,914

Investment 15 74,757,822 35,001,067 34,776,681 74,757,822 35,001,067

Investments in subsidiary 16 - - - 50,693,137 99,999,980

Loans to employees under welfare program 35 289,116,853 323,156,809 296,775,742 289,116,853 323,156,809

Equipment 17 154,576,496 142,622,806 221,453,351 150,404,326 139,991,453

Intangible assets 18 31,628,981 23,792,302 42,150,316 28,506,351 21,697,875

Property foreclosed 9,886,500 9,886,500 9,886,500 9,886,500 9,886,500

Deposits 41,222,123 39,446,015 44,089,918 41,214,739 39,426,740

Deferred tax assets 8, 33 26,364,853 20,869,995 27,222,737 36,226,222 20,869,995

Other assets 19 145,223,800 103,354,882 170,087,021 141,671,428 101,631,117

Total assets 13,999,496,365 7,187,071,562 14,684,972,473 14,019,708,720 7,217,073,066

The accompanying notes are an integral part of the financial statements.

Separate financial statements


Statement of Financial Position (continued)


(Unit: Baht)


Note 31 December 2012 1 January 2012 31 December 2013 31 December 2012 1 January 2012

(Restated) (Restated) (Restated) (Restated)

Liabilities and shareholders' equity

Liabilities

Borrowings from financial institutions 20 2,170,000,000 594,000,000 2,575,000,000 2,170,000,000 594,000,000

Payables to Clearing House 451,884,582 - 161,250,191 451,884,582 -

Securities and derivatives business payables 21 3,956,161,311 1,354,730,346 2,919,518,482 3,956,161,311 1,354,730,346

Derivatives liabilities 14 24,287,154 5,951,432 7,715,904 24,287,154 5,951,432

Debt issued and borrowings 22 2,007,423,532 - 2,946,827,927 2,007,423,532 -

Provisions 23 83,729,320 57,765,356 106,493,465 83,025,535 57,428,948

Accrued bonus 305,799,373 480,784,004 384,583,145 305,099,373 480,259,440

Income tax payable 131,393,646 133,493,250 133,795,428 131,393,646 133,493,250

Accrued expenses 103,738,259 75,446,194 133,527,197 102,015,150 74,993,205

Liabilities under financial lease agreements 25 17,569,177 16,518,166 18,317,488 16,072,114 14,806,825

Dividend payable 167,230,381 916,404 916,404 167,230,380 916,404

Other liabilities 36,902,005 26,514,884 21,343,080 36,450,451 26,371,726

Total liabilities 9,456,118,740 2,746,120,036 9,409,288,711 9,451,043,228 2,742,951,576

Shareholders' equity

Share capital

Registered

572,250,000 ordinary shares of Baht 5 each 2,861,250,000 2,861,250,000 2,861,250,000 2,861,250,000 2,861,250,000

Issued and fully paid-up

570,814,500 ordinary shares of Baht 5 each 2,854,072,500 2,854,072,500 2,854,072,500 2,854,072,500 2,854,072,500

Share premium 523,570,729 523,570,729 523,570,729 523,570,729 523,570,729

Premium on treasury shares 19,218,670 5,347,943 19,218,670 19,218,670 5,347,943

Retained earnings

Appropriated - statutory reserve 27 286,125,000 286,125,000 286,125,000 286,125,000 286,125,000

Appropriated - treasury shares reserve - 11,260,973 - - 11,260,973

Unappropriated 860,390,726 771,835,354 1,592,696,863 885,678,593 805,005,318

Less: Treasury shares - (11,260,973) - - (11,260,973)

Equity attributable to equity holders of the Company 4,543,377,625 4,440,951,526 5,275,683,762 4,568,665,492 4,474,121,490

Non-controlling interests of the subsidiary - - - - -

Total shareholders' equity 4,543,377,625 4,440,951,526 5,275,683,762 4,568,665,492 4,474,121,490

Total liabilities and shareholders' equity 13,999,496,365 7,187,071,562 14,684,972,473 14,019,708,720 7,217,073,066

- - - - -




Statement of comprehensive income

For the year ended 31 December 2013

(Unit: Baht)

Consolidated financial statements Separate financial statements

Note 2013 2012 2013 2012

(Restated) (Restated)

Income

Brokerage fee 29 3,618,575,673 2,521,071,118 3,618,575,673 2,521,071,118

Fee and service income 30 72,054,798 77,817,729 72,214,042 78,668,049

Loss on investments 15.2 (159,230,193) (68,836,286) (159,230,193) (68,836,286)

Gain on derivatives 14.1 179,062,338 94,988,209 179,062,338 94,988,209

Interest and dividends 329,494,243 237,925,856 329,494,243 237,925,856

Interest on margin loans 636,224,634 343,412,557 636,224,634 343,412,557

Gains on sale of investment in subsidiary 18,623,876 - 10 -

Other income 80,007,911 25,233,800 80,062,285 26,088,277

Total income 4,774,813,280 3,231,612,983 4,756,403,032 3,233,317,780

Expenses

Financial costs 459,493,497 209,573,748 459,493,497 209,573,748

Fee and service expenses 273,938,405 206,333,894 273,938,405 206,333,894

Operating expenses

Personnel expenses 32 1,682,886,758 1,231,090,315 1,682,886,758 1,231,090,315

Premises and equipment expenses 337,553,168 302,125,962 337,632,392 302,125,962

Taxes and duties 31,148,371 14,974,540 31,148,371 14,974,540

Directors' remuneration 31 4,325,000 8,600,000 4,325,000 8,600,000

Information and technology 29,131,071 34,982,621 29,131,071 34,982,621

Other expenses 153,409,862 202,448,630 153,409,862 202,448,630

Total operating expenses 2,238,454,230 1,794,222,068 2,238,533,454 1,794,222,068

Reversal of bad debt and doubtful accounts 13 (1,732,210) (405,578) (1,732,210) (405,578)

Loss from impairment of investment - - - 49,306,843

Total expenses 2,970,153,922 2,209,724,132 2,970,233,146 2,259,030,975

Profit before income tax expenses 1,804,659,358 1,021,888,851 1,786,169,886 974,286,805

Income tax expenses 33 (355,772,123) (248,131,603) (365,633,492) (238,270,234)

Profit from continuing operations 1,448,887,235 773,757,248 1,420,536,394 736,016,571

Discontinued operations

Loss from discontinued operations 39 (3,062,994) (29,858,580) - -

Profit for the year 1,445,824,241 743,898,668 1,420,536,394 736,016,571

Other comprehensive income:

Other comprehensive income for the year - - - -

Total comprehensive income for the year 1,445,824,241 743,898,668 1,420,536,394 736,016,571

Profit attributable to:

Equity holders of the Company

Profit from continuing operations 1,448,887,235 773,757,248 1,420,536,394 736,016,571

Loss from discontinued operations (3,062,994) (29,858,580) - -

Profit attributable to equity holders of the Company 1,445,824,241 743,898,668 1,420,536,394 736,016,571

Non-controlling interests

Profit from continuing operations - -

Loss from discontinued operations - -

Profit attributable to equity holders of

the non-controlling interests - -

1,445,824,241 743,898,668



Statement of comprehensive income (continued)


(Unit: Baht)


Note 2013 2012 2013 2012


Total comprehensive income attributable to:

Equity holders of the Company

Comprehensive income from continuing operations 1,448,887,235 773,757,248 1,420,536,394 736,016,571

Comprehensive income (loss) from discontinued operations 39 (3,062,994) (29,858,580) - -

Total comprehensive income attributable to the Company 1,445,824,241 743,898,668 1,420,536,394 736,016,571

Non-controling interests

Comprehensive income from continuing operations - -

Comprehensive income (loss) from discontinued operations - -

Total comprehensive income attributable to

the non-controlling interests - -

1,445,824,241 743,898,668

Earnings per share attributable to equity holders of the Company

Basic earnings (loss) per share 34

From continuing operations 2.54 1.36 2.49 1.29

From discontinued operations 39 (0.01) (0.05) - -

2.53 1.31 2.49 1.29



Cash flow statements


(Unit: Baht)


2013 2012 2013 2012


Cash flows from operating activities

Profit before income tax expenses from continuing operation 1,804,659,358 1,021,888,851 1,786,169,886 974,286,805

Loss before income tax expenses from discontinued operation (3,062,994) (29,858,580) - -

Adjustments to reconcile profit before income tax to net

cash provided by (paid for) operating activities:

Depreciation and amortisation 86,933,402 71,697,625 86,712,535 70,325,608

Reversal of bad debt and doubtful accounts (1,732,210) (405,578) (1,732,210) (405,578)

Unrealised (gains) losses on revaluation of investments 2,490,137 (1,439,394) 2,490,137 (1,439,394)

Unrealised (gains) losses on revaluation of derivatives liabilities (2,623,943) 8,798,024 (2,623,943) 8,798,024

Gains on sale of investiment in subsidiary (18,623,876) - (10) -

Unrealised losses on revaluation of foreign borrowings - 7,423,581 - 7,423,581

Unrealised losses on revaluation of foreign receivables and payables 1,044,724 19,397,595 1,044,724 19,397,595

Losses from impairment of investment - - - 49,306,843

(Gains) losses on sales and written-off of premises

and equipment (2,626,730) 842,273 (2,454,762) 594,214

Retirement benefit 23,535,461 25,963,964 23,467,930 25,596,587

Financial cost 458,387,030 208,598,709 458,387,030 208,598,709

Amortised interest expense of financial lease 1,114,913 1,084,329 1,106,467 975,039

Reversal of doubtful accounts - other receivables (59,960) (100,000) (59,960) (100,000)

Interest income (972,794,288) (587,708,782) (972,677,480) (586,413,523)

Cash paid for interest (409,408,258) (210,201,712) (409,399,812) (210,092,422)

Cash paid for income tax (354,239,031) (255,791,346) (354,228,224) (255,726,065)

Profit from operating activities before

changes in operating assets and liabilities 612,993,735 280,189,559 616,202,308 311,126,023

Decrease (increase) in operating assets

Deposits at financial institutions (67,852) (4,085) (67,852) (4,085)

Receivables from Clearing House 925,390,721 (1,085,475,985) 925,390,721 (1,085,475,985)

Securities and derivatives business receivables (955,303,859) (5,789,275,254) (955,303,859) (5,789,275,254)

Investments 37,491,004 (38,317,361) 37,491,004 (38,317,361)

Loans to employees under welfare program (7,658,889) 34,039,956 (7,658,889) 34,039,956

Deposits (2,875,179) (1,776,108) (2,875,179) (1,787,999)

Other assets (26,991,024) (7,908,766) (26,444,149) (6,058,159)

Increase (decrease) in operating liabilities

Payables to Clearing House (290,634,391) 451,872,298 (290,634,391) 451,872,298

Securities and derivatives business payables (1,036,642,829) 2,600,575,988 (1,036,642,829) 2,600,575,988

Derivative liabilities (13,947,307) 9,537,698 (13,947,307) 9,537,698

Accrued bonus 79,060,086 (174,984,631) 79,483,772 (175,160,067)

Accrued expenses (5,653,626) 28,344,885 (4,329,867) 27,074,765

Other liabilities (15,286,154) 10,387,121 (15,107,370) 10,078,725

Net cash flows used in operating activities (700,125,564) (3,682,794,685) (694,443,887) (3,651,773,457)



Cash flow statement (continued)


(Unit: Baht)


2013 2012 2013 2012


Cash flows from investing activities

Cash received from interest 961,528,521 537,086,677 961,330,316 535,704,135

Cash received from sale investment in subsidiary 26,707,542 - 50,693,147 -

Proceeds from disposals of equipment 3,378,491 728,456 3,378,491 719,508

Cash paid for purchases of equipment (114,115,098) (75,461,752) (114,115,098) (72,583,706)

Cash paid for purchases of intangible assets (20,134,529) (11,824,099) (20,134,529) (10,504,100)

Net cash flows from investing activities 857,364,927 450,529,282 881,152,327 453,335,837

Cash flows from financing activities

Cash received from borrowings 104,796,000,000 104,527,000,000 104,796,000,000 104,527,000,000

Cash paid for borrowings (104,391,000,000) (102,951,000,000) (104,391,000,000) (102,951,000,000)

Cash received from foreign borrowings 4,500,000,000 1,999,999,951 4,500,000,000 1,999,999,951

Cash paid for foreign borrowings (6,507,423,532) - (6,507,423,532) -

Cash received from other borrowings 13,402,727,642 - 13,402,727,642 -

Cash paid to other borrowings (10,500,000,000) - (10,500,000,000) -

Cash received from treasury shares - 25,131,700 - 25,131,700

Cash paid on principal of long-term lease (6,004,257) (4,256,007) (5,985,739) (4,041,729)

Dividend paid (879,832,102) (500,290,293) (879,832,102) (500,290,293)

Net cash flows from financing activities 414,467,751 3,096,585,351 414,486,269 3,096,799,629

Net decrease in cash and cash equivalents 571,707,114 (135,680,052) 601,194,709 (101,637,991)

Cash and cash equivalents as at 1 January 301,264,070 436,944,122 271,776,475 373,414,466

Cash and cash equivalents as at 31 December 872,971,184 301,264,070 872,971,184 271,776,475

- - - -


(Unit: Thousand Baht)

Retained earnings

Appropriated - Total equity Non-controlling

Premium on Appropriated - treasury shares attributable to holders interests of

Share capital Share premium treasury shares statutory reserve reserve Unappropriated Treasury shares of the Company subsidiary Total

Balance as at 1 January 2012- as previously reported 2,854,072,500 523,570,729 5,347,943 286,125,000 11,260,973 750,965,359 (11,260,973) 4,420,081,531 - 4,420,081,531

Cumulative effect of changes in accounting policy

for deferred tax (Note 3) - - - - - 20,869,995 - 20,869,995 - 20,869,995

Balance as at 1 January 2012 - as restated 2,854,072,500 523,570,729 5,347,943 286,125,000 11,260,973 771,835,354 (11,260,973) 4,440,951,526 - 4,440,951,526

Premium on treasury shares - - 13,870,727 - - - - 13,870,727 - 13,870,727

Decrease in treasury shares - - - - - - 11,260,973 11,260,973 - 11,260,973

Total comprehensive income for the year (restated) - - - - - 743,898,668 - 743,898,668 - 743,898,668

Treasury shares reserve - - - - (11,260,973) 11,260,973 - - - -

Dividend paid (Note 20) - - - - - (666,604,269) - (666,604,269) - (666,604,269)

Balance as at 31 December 2012 - as restated 2,854,072,500 523,570,729 19,218,670 286,125,000 - 860,390,726 - 4,543,377,625 - 4,543,377,625



Statement of changes in shareholders' equity


Consolidated financial statement

Equity attributable to holders of the Company

(Unit: Thousand Baht)

Retained earnings

Appropriated -

Premium on Appropriated - treasury shares

Share capital Share premium treasury shares statutory reserve reserve Unappropriated Treasury shares Total

Balance as at 1 January 2012 - as previously reported 2,854,072,500 523,570,729 5,347,943 286,125,000 11,260,973 784,135,323 (11,260,973) 4,453,251,495


for deferred tax (Note 3) - - - - - 20,869,995 - 20,869,995

Balance as at 1 January 2012 - as restated 2,854,072,500 523,570,729 5,347,943 286,125,000 11,260,973 805,005,318 (11,260,973) 4,474,121,490

Premium on treasury shares - - 13,870,727 - - - - 13,870,727

Decrease in treasury shares - - - - - - 11,260,973 11,260,973

Total comprehensive income for the year (restated) - - - - - 736,016,571 - 736,016,571

Treasury shares reserve - - - - (11,260,973) 11,260,973 - -

Dividend paid (Note 20) - - - - - (666,604,269) - (666,604,269)

Balance as at 31 December 2012 - as restated 2,854,072,500 523,570,729 19,218,670 286,125,000 - 885,678,593 - 4,568,665,492

Balance as at 1 January 2013 - as previously reported 2,854,072,500 523,570,729 19,218,670 286,125,000 - 849,452,371 - 4,532,439,270


for deferred tax (Note 3) - - - - - 36,226,222 - 36,226,222

Balance as at 1 January 2013 - as restated 2,854,072,500 523,570,729 19,218,670 286,125,000 - 885,678,593 - 4,568,665,492

Total comprehensive income for the year - - - - - 1,420,536,394 - 1,420,536,394

Dividend paid (Note 20) - - - - - (713,518,124) - (713,518,124)

Balance as at 31 December 2013 2,854,072,500 523,570,729 19,218,670 286,125,000 - 1,592,696,863 - 5,275,683,762


Statement of changes in shareholders' equity (continued)





Notes to financial statements


1. General information

Maybank Kim Eng Securities (Thailand) Public Company Limited (“the Company”) is a public

limited company incorporated and domiciled in Thailand. Its parent company is Maybank Kim

Eng Holdings Limited, which is incorporated in Singapore. The parent company of the Group

is Mayban IB Holdings Sdn Bhd, which is incorporated in Malaysia. The Company has

licenses for securities business, which are brokering, trading, underwriting, investment

advisory, corporate finance advisory, securities registrant, TFEX and securities borrowing

and lending.

The Company's registered office is located on 999/9 the Offices at Central World, 20th - 21st

and 24th - 25th Floor, Rama 1 Road, Pathumwan, Bangkok. As at 31 December 2013, the

Company has 54 branches in Bangkok and upcountry (31 December 2012: 45 branches).

2. Basis for the preparation of financial statements

The financial statements have been prepared in accordance with Thai financial Reporting

Standards enunciated under the Accounting Professions. B.E. 2547 and are presented in

compliance with the requirement of the notification of the Office of the Securities and

Exchange Commission relating to the format of the financial statements of securities

companies No. Sor. Thor. Kor. Nor. 53/2553 dated 15 December 2010.

The financial statements in Thai language are the official statutory financial statements of the

Company. The financial statements in English language have been translated from such

financial statements in Thai language.

The financial statements have been prepared on a historical cost basis except where

otherwise disclosed in the accounting policies.

3. Basis for the preparation of the consolidated financial statements

a) The consolidated financial statements include the financial statements of Maybank Kim

Eng Securities (Thailand) Public Company Limited (“the Company”) and the following

subsidiary company (“the subsidiary”):

Company’s name

Nature of

business

Country of

incorporation Percentage of shareholding

31 December 2013 31 December 2012

Percent Percent

Maybank Asset Management

(Thailand) Company Limited

(Formerly known as” Kim Eng

Asset Management

(Thailand) Company Limited”)

Fund

management

Thailand - 99.99

b) Subsidiary is fully consolidated, being the date on which the Company obtains control,

and continue to be consolidated until the date when such control ceases.

c) The financial statements of the subsidiary are prepared using the same significant

accounting policies as the Company.

d) Material balances and transactions between the Company and its subsidiary company

have been eliminated from the consolidated financial statements.

There has been change in the composition of the group during the current year, with the

Company selling ordinary shares of Maybank Asset Management (Thailand) Company

Limited (“subsidiary company”) (Formerly known as ”Kim Eng Asset Management (Thailand)

Company Limited”) to Maybank Asset Management Group Berhad, which is a related

company. The consolidated financial statements therefore include the financial statements of

the subsidiary up to the date on which the Company disposed of its investment.

4. Accounting standards that became effective in the current accounting year

Below is a summary of accounting standards that became effective in the current accounting

year.

Accounting standards:

TAS 12 Income Taxes

TAS 20 (revised 2009) Accounting for Government Grants and Disclosure of

Government Assistance

TAS 21 (revised 2009) The Effects of Changes in Foreign Exchange Rates

Financial Reporting Standard:

TFRS 8 Operating Segments

Accounting Standard Interpretations:

TSIC 10 Government Assistance - No Specific Relation to Operating

Activities

TSIC 21 Income Taxes - Recovery of Revalued Non-Depreciable Assets

TSIC 25 Income Taxes - Changes in the Tax Status of an Entity or its

Shareholders

Accounting Treatment Guidance for Transfers of Financial Assets

These accounting standards, financial reporting standard, accounting standard

interpretations and accounting treatment guidance do not have any significant impact on the

financial statements, except for the following accounting standard.

TAS 12 Income Taxes

This accounting standard requires an entity to identify temporary differences between the

carrying amount of an asset or liability in the statements of financial position and its tax base

and recognise the tax effects as deferred tax assets or liabilities subjecting to certain

recognition criteria. The Company and its subsidiary have changed this accounting policy in

this current year and restated the prior year’s financial statements, presented as comparative

information, as though the Company and its subsidiary had initially recognised the tax effects

as deferred tax assets or liabilities. The cumulative effect of this change in accounting policy

has been presented in Note 8 to the financial statements.

5. Accounting standards that will become effective in the future

Below in a summary of accounting standards that will become effective in the future.

Effective date

Accounting Standards:

TAS 1 (revised 2012) Presentation of Financial Statements 1 January 2014

TAS 7 (revised 2012) Statement of Cash Flows 1 January 2014

TAS 12 (revised 2012) Income Taxes 1 January 2014

TAS 17 (revised 2012) Leases 1 January 2014

TAS 18 (revised 2012) Revenue 1 January 2014

TAS 19 (revised 2012) Employee Benefits 1 January 2014

TAS 21 (revised 2012) The Effects of Changes in Foreign

Exchange Rates

1 January 2014

TAS 24 (revised 2012) Related Party Disclosures 1 January 2014

TAS 28 (revised 2012) Investments in Associates 1 January 2014

TAS 31 (revised 2012) Interests in Joint Ventures 1 January 2014

TAS 34 (revised 2012) Interim Financial Reporting 1 January 2014

TAS 38 (revised 2012) Intangible Assets 1 January 2014

Financial Reporting Standards:

TFRS 2 (revised 2012) Share-based Payment 1 January 2014

TFRS 3 (revised 2012) Business Combinations 1 January 2014

TFRS 4 Insurance Contracts 1 January 2016

TFRS 5 (revised 2012) Non-current Assets Held for Sale and

Discontinued Operations

1 January 2014

TFRS 8 (revised 2012) Operating Segments 1 January 2014

Accounting Standard Interpretations:

TSIC 15 Operating Leases - Incentives 1 January 2014

TSIC 27 Evaluating the Substance of Transactions

Involving the Legal Form of a Lease

1 January 2014

TSIC 29 Service Concession Arrangements:

Disclosures

1 January 2014

TSIC 32 Intangible Assets - Web Site Costs 1 January 2014

Financial Reporting Standard Interpretations:

TFRIC 1 Changes in Existing Decommissioning,

Restoration and Similar Liabilities

1 January 2014

TFRIC 4 Determining whether an Arrangement

contains a Lease

1 January 2014

TFRIC 5 Rights to Interests arising from

Decommissioning, Restoration and

Environmental Rehabilitation Funds

1 January 2014

Effective date

TFRIC 7 Applying the Restatement Approach

under TAS 29 Financial Reporting in

Hyperinflationary Economies

1 January 2014

TFRIC 10 Interim Financial Reporting and

Impairment

1 January 2014

TFRIC 12 Service Concession Arrangements 1 January 2014

TFRIC 13 Customer Loyalty Programmes 1 January 2014

TFRIC 17 Distributions of Non-cash Assets to

Owners

1 January 2014

TFRIC 18 Transfers of Assets from Customers 1 January 2014

The Company’s management believes that these accounting standards, financial reporting

standards, accounting standard interpretations and financial reporting standard

interpretations will not have any significant impact on the financial statements for the year

when they are initially applied.

6. Significant accounting policies

6.1 Revenue recognition

a) Brokerage fees

Brokerage fees on securities and derivatives business are recognised as income on the

transaction date.

b) Fees and service income

Fees and service income are recognised when services have been rendered taken into

account to the stage of completion.

c) Gain (loss) on investments and derivatives

Gain (loss) on investments and derivatives are recognised as income/expense on the

transaction date.

d) Interest and dividend

Interest is recognised on an accrual basis based on an effective rate. Dividend is

recognised when the right to receive the dividend is established.

(e) Interest on credit balance loans

Interest is recognised over the term of the loans based on the amount of principal

outstanding. No accrual has been made for certain loans which, under Notification No.

Kor. Thor. 5/2544 dated 15 February 2001 of the Office of the Securities and Exchange

Commission, are not qualified for recognition of interest on an accrual basis and

consideration of other relevant factors.

6.2 Expense recognition

a) Interest on borrowings

Interest on borrowings is charged to expenses on an accrual basis.

b) Fees and service expenses

Fees and service expenses are charged to expenses on an accrual basis.

6.3 Cash and cash equivalents

Cash and cash equivalents include cash on hand and all bank deposit accounts maturing

within 3 months or less from the date of acquisition, and including certificate of deposit

maturing within 3 months or less from the date of acquisition and not subject to withdrawal

restrictions.

6.4 Recognition and amortisation of customers’ assets

Assets which customers have placed with the Company for securities trading, in term of cash

accounts and credit balance accounts, including amounts which customers have placed as

security for derivative trading, are recorded as assets and liabilities of the Company for

internal control purpose. At the financial position date, the Company writes off those amounts

which there are no guarantee obligations from both assets and liabilities and presents only

those assets which belong to the Company.

6.5 Borrowing and lending of securities

The Company is engaged in securities borrowing and lending, whereby the Company acts as

a principal or an agent of the borrowers and lenders of securities.

The Company records its obligations to return borrowed securities which it has lent as

“Securities borrowing payables” and securities lent to customers are recorded as “Securities

borrowing receivables” in the statement of financial position. At the end of the year, the

balance of securities borrowing payables and securities borrowing receivables are adjusted

based on the latest offer price quoted on the Stock Exchange of Thailand of the last working

day of the year. Gains or losses arising from such adjustment are included in part of profit or

loss in the statement of comprehensive income. The Company records cash paid as

collateral for securities borrowing as “Guaranteed deposit receivables” and cash received as

collateral for securities lending as “Guarantee deposit payable”. Fees from borrowing and

lending are recognised on an accrual basis over the term of the lending.

6.6 Investments

a) Investments in securities held for trading are determined at fair value. Changes in the

fair value of these securities are recorded as profit or loss in the statement of

comprehensive income.

b) Investments in available-for-sale securities are stated at fair value. Changes in the fair

value of these securities are recognised as gain (loss) on changes in value of

investments as part of other comprehensive income in the statement of comprehensive

income, and will be recognised as part of profit or loss when the securities are sold.

c) Held to maturity debt securities are initially recognised at purchase price plus

transaction costs and subsequently accounted for at amortised cost using effective

interest method less allowance for impairment loss (if any).

d) Investments in non-marketable equity securities which the Company classified as other

investments, are stated at cost net of allowance for impairment loss (if any).

e) Investments in subsidiary are accounted for in the separate financial statements using

the cost net of allowance for impairment loss (if any).

f) The fair value of marketable securities is based on the latest bid price of the last

working day of the year as quoted on the Stock Exchange of Thailand. The fair value of

debt instruments is determined based on required rate of return or the yield rates

quoted by the Thai Bond Market Association.

g) The weighted average method is used for computation of the cost of investments. On

disposal of an investment, the difference between net disposal proceeds and the

carrying amount of the investment is recognised as part of profit or loss in the statement

of comprehensive income.

h) Impairment loss (if any) is included in part of profit or loss in the statement of

comprehensive income when there is a factor indicating that such investments might be

impaired.

6.7 Receivables from/payables to Clearing House

Receivables from/payables to Clearing House comprise the net balance of receivables

from/payables to Thailand Clearing House in respect of settlements for securities trades and

derivative instruments. They include amounts pledged with Thailand Clearing House as

security for derivatives trading the and the net balance of amounts receivable from/payable to

foreign securities companies in respect of securities trades settled overseas through foreign

securities companies.

6.8 Securities and derivatives business receivables and allowance for doubtful accounts

Securities and derivatives business receivables comprise the net securities business

receivables and derivatives business receivables, after deducting allowance for doubtful

accounts and adding related accrued interest receivables.

In addition, securities business receivables comprise the net receivable balances of cash

accounts, credit balance receivables for which the securities purchased are used as

collateral, securities borrowing and lending receivables and guarantee deposit receivables

(which comprise cash placed as guarantee for borrowers of securities) as well as other

receivables such as overdue cash customers accounts and receivables which are subject to

legal proceedings, are undergoing restructuring or are settling in installments.

The Company provides allowance for doubtful accounts based on a review of the debtor’s

ability to make payment, taking into consideration recovery risk and the value of the collateral.

Such debt classifications and provisions are made in accordance with the guideline laid down

in the Notification No. Kor. Thor. 5/2544 dated 15 February 2001 of the Office of the Securities

and Exchange Commission (SEC), and consideration of other relevant factors.

6.9 Premises and Equipment/Depreciation

Premises and equipment are stated at cost less accumulated depreciation and allowance for

impairment loss (if any). Depreciation of premises and equipment is calculated by reference

to their cost on a straight-line basis over the following estimated useful lives:

Building improvement 5 years

Furniture, fixtures and equipment 3 and 5 years

Vehicles 5 years

No depreciation is provided on assets under installation.

Depreciation is included in determining income.

An item of premises and equipment is derecognised upon disposal or when no future

economic benefits are expected from its use or disposal. Any gain or loss arising on disposal

of an asset is included in profit or loss when the asset is derecognised.

6.10 Intangible assets and amortisation

Expenditure on acquisitions of intangible assets is capitalised and amortised using the

straight-line method over their useful lives, generally over 5 years, with the exception of

TFEX member fees and fund license, which are not amortised.

Such intangible assets are not revalued. The carrying amount of each intangible asset is

reviewed annually and adjusted for impairment where it is considered necessary.

6.11 Property foreclosed

Property foreclosed consists of immovable properties, and is stated at the lower of cost or

net realisable value. Loss on impairment is included in determining income. Gains or losses

on disposals of such properties are recognised in the statement of comprehensive income at

the date of disposal.

6.12 Loans to employees under welfare program

Loans to employees under welfare program are recognised initially at the amount granted to

the employees and are subsequently stated at amortised cost, based on the contractual

interest rate. Returns are recognised in the statement of comprehensive income over the

term of loan.

6.13 Borrowings and debt issued

Borrowings and debt issued are recognised initially at the fair value of the proceeds received.

Borrowings are subsequently stated at amortised cost, using the effective yield method; any

difference between proceeds and the redemption value is recognised in the statements of

comprehensive income over the period of the borrowings.

6.14 Long-term lease

Leases of equipment which transfer substantially all the risks and rewards of ownership to

the lessee are classified as finance leases. Finance leases are capitalised at the lower of the

fair value of the leased assets and the present value of the minimum lease payments. The

outstanding rental obligations, net of finance charges, are recorded as liabilities, while the

interest element is charged to profit or loss over the lease period. The assets acquired under

finance leases is depreciated over the useful life of the asset.

Operating lease payments are recognised as an expense in profit or loss on a straight line

basis over the lease term.

6.15 Securities and derivatives business payables

Securities and derivatives business payables are the obligations of the Company in respect

of its securities and derivatives business with outside parties, such as the net payable

balances of cash accounts, securities delivery obligations as a result of short sales or

securities borrowing, and obligations to return assets held by the Company as collateral for

securities lending.

6.16 Provisions

Provisions are recognised when the Company has a present obligation as a result of a past

event, it is probable that an outflow of resources embodying economic benefits will be

required to settle the obligation, and a reliable estimate can be made of the amount of the

obligation.

6.17 Treasury stocks

The consideration paid in case where the Company purchases back ordinary share of the

Company, including any attributable incremental external costs net of income taxes, is

deducted from total owners’ equity as treasury shares until the treasury shares are

cancelled. It such shares are subsequently sold or reissued, any consideration received is

included in owners’ equity.

6.18 Related party transactions

Related parties comprise enterprises and individuals that control, or are controlled by, the

Company and its subsidiary, whether directly or indirectly, or which are under common

control with the Company.

They also include associated companies and individuals which directly or indirectly own a

voting interest in the Company that gives them significant influence over the Company,

management personnel, directors and officers with authority in the planning and direction of

the operations of the Company.

6.19 Foreign currencies

Transactions in foreign currencies are translated into Baht at the exchange rate ruling at the

date of the transaction. Monetary assets and liabilities denominated in foreign currencies are

translated into Baht at the exchange rate ruling at the end of reporting date.

Gains and losses on exchange are included in determining income.

6.20 Impairment of assets

The Company assesses at each reporting date whether there is an indication that an asset

may be impaired. If any indication exists, or when annual impairment testing for an asset is

required, the Company realises loss on impairment when the asset’s recoverable amount is

less than the book value. An asset’s recoverable amount is the higher of an asset’s fair value

less cost to sell and its value in use. Fair value less cost to sell reflects the amount that the

Company could obtain from the disposal of the asset in an arm’s length transaction between

knowledgeable, willing parties, after deducting the cost of disposal. In assessing value in use,

the estimated future cash flows are discounted to their present value using a pre-tax discount

rate that reflects current market assessments of the time value of money and the risks

specific to the asset.

Impairment losses are recognised in part of profit or loss in the statement of comprehensive

income.

At the reporting date, an assessment is made whether there is any indication that previously

recognised impairment losses may no longer exist or may have decreased. If such indication

exists, the Company estimates the asset’s recoverable amount and impairment loss

recognised in prior periods is reversed.

6.21 Employee benefits

a) Short-term benefits

Salaries, wages, bonuses, contribution to the social security fund and provident fund and

annual leave benefits are recognised as expenses when the employees performed the

service.

b) Post-employment benefits (Defined contribution plans)

The Company and the employees have jointly established a provident fund. The fund is

monthly contributed by employees and by the Company and its subsidiary. The fund’s

assets are held in a separate trust fund and the Company’ contributions are recognised as

expenses when incurred.

c) Post-employment benefits (Defined benefit plans)

The Company has obligations in respect of the severance payments they must make to

employees upon retirement under labor law. The Company treats these severance

payment obligations as a defined benefit plan.

The obligation under the defined benefit plan is determined by a professionally qualified

independent actuary, using the projected unit credit method. Such determination is

made based on various assumptions, including discount rate, future salary increase

rate, staff turnover rate, mortality rate, and inflation rates.

For the first-time adoption of TAS 19 Employee Benefits, the Company elected to

recognise the transitional liability, which exceeds the liability that would have been

recognised at the same date under the previous accounting policy, as an expense on a

straight-line basis over up to five years from the date of adoption.

6.22 Income tax

Income tax expense represents the sum of corporate income tax currently payable and

deferred tax.

Current tax

Current income tax is provided in the accounts at the amount expected to be paid to the

taxation authorities, based on taxable profits determined in accordance with tax legislation.

Deferred tax

Deferred income tax is provided on temporary differences between the tax bases of assets

and liabilities and their carrying amounts at the end of each reporting period, using the tax

rates enacted at the end of the reporting period.

The Company recognises deferred tax liabilities for all taxable temporary differences while it

recognises deferred tax assets for all deductible temporary differences and tax losses carried

forward to the extent that it is probable that future taxable profit will be available against

which such deductible temporary differences and tax losses carried forward can be utilised.

At each reporting date, the Company reviews and reduces the carrying amount of deferred

tax assets to the extent that it is no longer probable that sufficient taxable profit will be

available to allow all or part of the deferred tax asset to be utilised.

The Company records deferred tax directly to shareholders' equity if the tax relates to items

that are recorded directly to shareholders' equity.

6.23 Derivatives

Forward exchange contracts

Forward exchange contracts are recorded at fair value. Unrecognised gains or losses on

revaluation are included in determining income.

Futures contracts

The Company initially recognises future contracts at fair value. Obligations under derivatives

business and cash collateral amounts pledged as security for derivatives trading are

recorded as receivable at Thailand Clearing House. Subsequently, as at the date of the

statements of financial position, the futures contracts are presented at their fair value, with

the fair value of marketable future contracts being calculated with reference to the last

bid/offer prices quoted on Thailand Futures Exchange Public Company Limited on the last

business day of the year. Unrealised gains or losses resulting from changes in the fair value

of futures contracts are included in the statements of comprehensive income.

Derivative warrants

The Company initially recognises the fair value of derivative warrants as financial liabilities.

Subsequently, on the statement of financial position date, derivative warrants are presented

at fair value, with the fair value of marketable derivative warrants being calculated with

reference to the last offer price quoted on the Stock Exchange of Thailand on the last

business day of the year. Unrealised gains or losses resulting from changes in the fair values

of derivative warrants are included in the statement of comprehensive income.

7. Significant accounting judgments and estimates

The preparation of financial statements in conformity with financial reporting standards at

time requires management to make subjective judgments and estimates regarding matters

that are inherently uncertain. These judgments and estimates affect reported amounts and

disclosure, and actual results could differ from these estimation. The significant accounting

judgments and estimates are as follow:

7.1 Allowances for doubtful accounts for securities and derivatives business receivables

Allowances for doubtful accounts for securities and derivatives business receivables are

intended to adjust the values of receivables for probable credit losses. The management

uses the SEC’s regulations regarding the provision of allowance for doubtful accounts and

judgment to establish reserves for estimated losses for each outstanding receivable when

there is any doubt about the receivable’s capability to repay the debt. The allowances for

doubtful accounts are determined through a combination of specific reviews, probability of

default and the value of the securities used as collateral.

7.2 Fair value of financial instruments

In determining the fair value of financial instruments that are not actively traded and for which

quoted market prices are not readily available, the management exercised judgment, using

valuation techniques. The input to these models is taken from observable markets, and

includes consideration of liquidity, correlation and long-term volatility of financial instruments.

7.3 Allowance for impairment of investments

The Company treats other investments as impaired when there has been a significant or

prolonged decline in the fair value below their cost or where other objective evidence of

impairment exists. The determination of what is “significant” or “prolonged” requires judgment

of the management.

7.4 Building improvement and equipment/Depreciation

In determining depreciation of building improvement and equipment, the management is

required to make estimates of the useful lives and salvage values of the Company’s

premises and equipment and to review estimate useful lives and salvage values when there

are any changes.

In addition, the management is required to review premises and equipment for impairment on

a periodical basis and record impairment losses in the period when it is determined that their

recoverable amount is lower than the carrying cost. This requires judgments regarding

forecast of future revenues and expenses relating to the assets subject to the review.

7.5 Recognition and derecognition of assets and liabilities

In considering whether to recognise or to derecognise assets or liabilities, the management

is required to make judgment on whether significant risk and rewards of those assets or

liabilities have been transferred, based on their best knowledge of the current events and

arrangements.

7.6 Leases

In determining whether a lease is to be classified as an operating lease or finance lease, the

management is required to use judgment regarding whether significant risk and rewards of

ownership of the leased asset has been transferred, taking into consideration terms and

conditions of the arrangement.

7.7 Employee benefit

The obligation under the defined benefit plan is determined based on actuarial techniques.

Such determination is made based on various assumptions, including discount rate, future

salary increase rate, staff turnover rate and mortality rate.

7.8 Litigation

The Company has contingent liabilities as a result of litigation. The management has used

judgment to assess of the results of the litigation cases and recorded provision for contingent

liabilities as at the financial statement date. In case where they believe that there will be no

loss, they will not provide contingent liabilities as of the end of reporting period.

8. Cumulative effect of the change in accounting policies due to the adoption of new

accounting standard

During the current year, the Company and its subsidiary made the change described in Note

4 to the financial statements to its significant accounting policies, as a result of the adoption

of Thai Accounting Standard 12 Income Taxes. The cumulative effect of the change in the

accounting policies has been separately presented in the statements of changes in

shareholders’ equity.

The amounts of adjustments affecting the statements of financial position and the statements

of comprehensive income are summarised below.

(Unit: Baht)

Consolidated

financial statements

Separate


31 December

2012

1 January

2012

31 December

2013

31 December

2012

1 January

2012

Statements of financial position

Increase in deferred tax assets 26,364,853 20,869,995 27,222,737 36,226,222 20,869,995

Increase in unappropriated retained earnings 26,364,853 20,869,995 27,222,737 36,226,222 20,869,995

(Unit: Baht) Consolidated financial statements Separate financial statements

For the years ended 31 December For the years ended 31 December

2013 2012 2013 2012

Statements of comprehensive income

Profit or loss:

Increase (decrease) in income tax (857,884) (5,494,858) 9,003,485 (15,356,227)

Increase (decrease) in profit attributable to equity

holders of the Company 857,884 5,494,858 (9,003,485) 15,356,227

Increase (decrease) in basic earnings per share 0.002 0.010 (0.016) 0.027

9. Cash and cash equivalents

(Unit: Baht)

Consolidated


Separate


31 December 2012 31 December 2013 31 December 2012

Cash on hand 550,251 573,091 545,298

Current accounts and savings accounts 1,759,457,181 1,991,679,823 1,758,974,539

Fixed accounts/certificate of deposits 3,024,000,000 3,761,000,000 3,000,000,000

Promissory notes 5,000,000 - -

Total cash and cash equivalents 4,789,007,432 5,753,252,914 4,759,519,837

Less: Cash deposits held for customers (4,487,743,362) (4,880,281,730) (4,487,743,362)

Net cash and cash equivalents 301,264,070 872,971,184 271,776,475

10. Deposits at financial institutions

(Unit: Baht)

Consolidated

financial statement

Separate



Over 3 months - 1 year Over 3 months - 1 year

Fixed deposits 3,100,013,668 6,300,017,520 3,100,013,668

Deposits with restriction 3,437,091 3,501,091 3,437,091

Total deposits at financial institutions 3,103,450,759 6,303,518,611 3,103,450,759

Less: Cash deposits held for customers (3,100,000,000) (6,300,000,000) (3,100,000,000)

Total deposits at financial institutions - net 3,450,759 3,518,611 3,450,759

As at 31 December 2013, fixed deposits of Baht 4 million (31 December 2012: Baht

3 million) are pledged as collateral to local banks for letter of guarantees.

11. Receivables from Clearing House

(Unit: Baht)

Consolidated

financial statement

Separate



Receivables from Clearing House 1,406,135,298 743,164,691 1,406,135,298

Receivables from foreign securities company 1,306,085,544 96,932,297 1,306,085,544

Less: Receivables from Clearing House held

for customers (1,467,094,952) (521,406,543) (1,467,094,952)

Total receivables from Clearing House - net 1,245,125,890 318,690,445 1,245,125,890

12. Securities and derivatives business receivables

(Unit: Baht)

Consolidated

financial statement

Separate


2012 2013 2012

Securities business receivables

Cash accounts 2,772,635,962 2,312,268,641 2,772,635,962

Credit balance accounts 8,776,277,837 10,119,921,747 8,776,277,837

Receivables under securities borrowing and

lending business

- Guarantee deposit receivables - - -

- Securities borrowing receivables 82,273,325 152,221,720 82,273,325

Other receivables

- Overdue customers’ accounts 246,858,898 245,802,472 246,858,898

Total securities business receivables 11,878,046,022 12,830,214,580 11,878,046,022

Add: Accrued interest receivables 54,034,972 63,470,652 54,034,972

Less: Allowance for doubtful accounts (261,379,208) (259,702,297) (261,379,208)

Securities business receivables and accrued

interest receivables - net 11,670,701,786 12,633,982,935 11,670,701,786

Derivatives business receivables

Derivatives business receivables 6,330,142 9,465,443 6,330,142

Less: Allowance for doubtful accounts (153,710) (98,411) (153,710)

Derivatives business receivables - net 6,176,432 9,367,032 6,176,432

Total securities and derivatives business

receivables - net 11,676,878,218 12,643,349,967 11,676,878,218

12.1 As at 31 December 2013, the Company had other receivables with book values totaling Baht

260 million from which it has ceased recognising income (31 December 2012: Baht 262

million).

12.2 As at 31 December 2013 and 2012, the Company has classified securities business

receivables and derivatives business receivables, in accordance with the relevant notification

issued by the Office of the Securities and Exchange Commission. The classification is as

follows:

(Unit: Baht)


31 December 2012

Debt balance

Allowance for

doubtful

Accounts

Debt balance net of

allowance for

doubtful accounts

Normal Debt 11,676,657,853 - 11,676,657,853

Sub-standard Debt 9,678,539 (9,458,174) 220,365

Doubtful Debt 252,074,744 (252,074,744) -

Total 11,938,411,136 (261,532,918) 11,676,878,218

(Unit: Baht)


31 December 2013

Debt balance

Allowance for

doubtful

Accounts

Debt balance net of

allowance for

doubtful accounts

Normal Debt 12,643,064,587 - 12,643,064,587


Doubtful Debt 250,961,715 (250,961,715) -

Total 12,903,150,675 (259,800,708) 12,643,349,967

(Unit: Baht)


31 December 2012

Debt balance

Allowance for

doubtful

Accounts

Debt balance net of

allowance for

doubtful accounts

Normal Debt 11,676,657,853 - 11,676,657,853


Doubtful Debt 252,074,744 (252,074,744) -

Total 11,938,411,136 (261,532,918) 11,676,878,218

13. Allowance for doubtful accounts

(Unit: Baht)

Consolidated


Separate


For the year ended

31 December 2012

For the year ended

31 December 2013

For the year ended

31 December 2012

Balance - beginning of the year 261,938,496 261,532,918 261,938,496

Add: Doubtful accounts 118,450 2,913,672 118,450

Less: Reversal of doubtful accounts (524,028) (4,645,882) (524,028)

Balance - end of the year 261,532,918 259,800,708 261,532,918

14. Derivatives assets and derivatives liabilities

(Unit: Baht)


31 December 2012

Fair value Notional amount

Assets Liabilities Assets Liabilities

Trading derivatives

Derivatives warrants - 16,313,112 - 51,005,900

Forward exchange contracts - 7,974,042 - 1,997,062,277

Total derivatives assets and derivatives liabilities - 24,287,154 - 2,048,068,177

(Unit: Baht)


31 December 2013



Trading derivatives


Total derivatives assets and derivatives liabilities - 7,715,904 - 27,721,861

(Unit: Baht)


31 December 2012



Trading derivatives


Forward exchange contracts - 7,974,042 - 1,997,062,277

Total derivatives assets and derivatives liabilities - 24,287,154 - 2,048,068,177

14.1 Gain on derivatives

(Unit: Baht)

Consolidated and

separate financial statements

For the years ended 31 December

2013 2012

Realised gain on trading in derivatives

Derivative warrants 176,438,395 95,812,191

Unrealised gain (loss) on revaluation of derivatives

Derivative warrants 2,623,943 (823,982)

Total gain on derivatives 179,062,338 94,988,209

15. Investments

(Unit: Baht)

Consolidated

financial statement

Separate



Cost value/

amortised

cost Fair value

Cost value/

amortised

cost Fair value

Cost value/

amortised

cost Fair value

Trading securities

Equity securities

Listed securities 56,606,139 57,629,162 19,115,135 17,648,021 56,606,139 57,629,162

Total trading securities 56,606,139 57,629,162 19,115,135 56,606,139 57,629,162

Add: Allowance for revaluation 1,023,023 (1,467,114) 1,023,023

Trading securities - net 57,629,162 17,648,021 57,629,162

Held-to-maturity debt securities

Government and state enterprise securities - 300,412,498 -

Less: investment on behalf of customer - (300,412,498) -

Net held-to maturity debt securities - - -

Other investments

Other securities - ordinary shares 31,791,160 31,791,160 31,791,160

Less: allowance for impairment (14,662,500) (14,662,500) (14,662,500)

Net other investments 17,128,660 17,128,660 17,128,660

Total investments - net 74,757,822 34,776,681 74,757,822

15.1 Investments subject to restrictions

(Unit: Baht)

Consolidated


Separate



Cost value/

amortised

cost Fair value

Cost value/

amortised

cost Fair value

Cost value/

amortised

cost Fair value

Securities placed with court for stay

execution 7,622,000 15,509,541 7,622,000 13,568,950 7,622,000 15,509,541

Total 7,622,000 15,509,541 7,622,000 13,568,950 7,622,000 15,509,541

15.2 Gain (loss) on investments

(Unit: Baht)

Consolidated and separate financial statements

For the year ended 31 December

2013 2012

Realised loss on trading securities (156,738,572) (70,275,191)

Unrealised gain (loss) on revaluation of trading securities (2,491,621) 1,438,905

Total loss on investments (159,230,193) (68,836,286)

16. Investments in subsidiary

Investments in subsidiary as presented in separate financial statements are as follows:

Company’s name Business

Type of

Relations Paid-up capital

Shareholding

percentage Cost

Allowance for impairment loss Dividend

For the

31 31 31 31 31 31 31 31 years ended

December December December December December December December December 31 December

2013 2012 2013 2012 2013 2012 2013 2012 2013 2012

Million

Baht

Million

Baht

Percent Percent Million

Baht

Million

Baht

Million Baht Million Baht Million

Baht

Million

Baht

Subsidiary company

included in

consolidated financial

statements

Maybank Asset

Management

(Thailand) Company

Limited (Formerly

known as “Kim Eng

Asset Management

(Thailand) Company

Limited”)

Mutual fund

management

Shareholding - 100 - 99.99 - 100 - (49) - -

On 21 March 2013, the Company sold its 99.99 percent interest in a subsidiary to Maybank

Asset Management Group Berhad, which is a subsidiary in the Maybank Group, major

shareholder, for Baht 51 million. There is no gain on the sale of investment in subsidiary in

the separate financial statements (consolidated financial statement: Baht 19 million).

17. Equipment

(Unit: Baht)



Building

improvement

Furniture

Fixtures and

equipment

Asset under

financial lease

Construction in

process Total

Cost

31 December 2011 173,459,949 493,763,391 26,224,116 828,671 694,276,127

Additions 15,194,112 47,573,312 5,307,018 10,255,668 78,330,110

Transfer in (out) 9,711,785 1,133,275 - (10,845,060) -

Disposals/written-off (7,708,913) (69,614,268) - - (77,323,181)

31 December 2012 190,656,933 472,855,710 31,531,134 239,279 695,283,056

Accumulated depreciation

31 December 2011 132,735,798 406,842,500 12,075,023 - 551,653,321

Depreciation for the year 13,357,057 46,111,483 5,337,556 - 64,806,096


31 December 2012 139,901,000 383,392,981 17,412,579 - 540,706,560

Net book value

31 December 2011 40,724,151 86,920,891 14,149,093 828,671 142,622,806

31 December 2012 50,755,933 89,462,729 14,118,555 239,279 154,576,496

(Unit: Baht)



Building

improvement

Furniture

Fixtures and

equipment

Asset under

financial lease

Construction in

process Total

Cost

31 December 2012 188,913,101 470,627,365 29,789,032 239,279 689,568,777

Additions 20,293,554 98,501,317 8,231,113 22,126,451 149,152,435

Transfer in (out) 12,617,007 9,432,863 - (22,049,870) -

Disposals/written-off (8,020,126) (26,546,191) (4,785,316) - (39,351,633)

31 December 2013 213,803,536 552,015,354 33,234,829 315,860 799,369,579


31 December 2012 139,713,262 382,445,101 17,006,088 - 539,164,451


Disposals/written-off (7,489,556) (26,153,032) (4,785,316) - (38,427,904)

31 December 2013 148,578,885 411,257,779 18,079,564 - 577,916,228

Net book value

31 December 2012 49,199,839 88,182,264 12,782,944 239,279 150,404,326

31 December 2013 65,224,651 140,757,575 15,155,265 315,860 221,453,351

Depreciation charge for the years ended 31 December

2012 63,725,876

2013 77,179,681

(Unit: Baht)



Building

improvement

Furniture

Fixtures and

equipment

Asset under

financial lease

Construction in

process Total

Cost

31 December 2011 172,890,022 492,645,521 24,482,014 828,671 690,846,228

Additions 13,450,280 46,439,098 5,307,018 10,255,668 75,452,064

Transfer in (out) 9,711,785 1,133,275 - (10,845,060) -


31 December 2012 188,913,101 470,627,365 29,789,032 239,279 689,568,777


31 December 2011 132,479,823 406,358,000 12,016,952 - 550,854,775



31 December 2012 139,713,262 382,445,101 17,006,088 - 539,164,451

Net book value

31 December 2011 40,410,199 86,287,521 12,465,062 828,671 139,991,453

31 December 2012 49,199,839 88,182,264 12,782,944 239,279 150,404,326

As at 31 December 2013 and 2012, certain equipment items have been fully depreciated but

are still in use. The gross carrying amount (before deducting accumulated depreciation) of

those assets amounted to approximately Baht 441 million and Baht 423 million, respectively

(consolidated financial statements as at 31 December 2012: Baht 423 million).

18. Intangible assets (Unit: Baht)



Cost Accumulated amortisation

Useful

lives

1 January

2012 Increase

Transfer in

(transfer

out)

Disposal

subsidiary

31

December

2012

1 January

2012 Increase

Disposal

subsidiary

31

December

2012

Net

intangible

assets

Computer software 5 years 75,801,352 11,689,185 2,015,543 (101,500) 89,404,580 57,599,940 6,891,529 (101,093) 64,390,376 25,014,204

Software under

installation

- 1,270,342 2,539,430 (2,015,543) - 1,794,229 - - - - 1,794,229

Deferred expenses

of membership

fee - Thailand

Futures

Exchanges

- 5,000,000 - - - 5,000,000 1,679,452 - - 1,679,452 3,320,548

Deferred expenses

of fund license - 1,000,000 500,000 - - 1,500,000 - - - - 1,500,000

Total 83,071,694 14,728,615 - (101,500) 97,698,809 59,279,392 6,891,529 (101,093) 66,069,828 31,628,981

(Unit: Baht)




Useful

lives

1 January

2013 Increase

Transfer in

(transfer

out) Written-off

31

December

2013

1 January

2013 Increase Written-off

31

December

2013

Net

intangible

assets


Software under

installation

- 974,229 1,847,274 (1,321,314) - 1,500,189 - - - - 1,500,189

Deferred expenses

of membership

fee - Thailand

Futures

Exchanges

- 5,000,000 - - - 5,000,000 1,679,452 - - 1,679,452 3,320,548

Total 93,923,809 23,176,820 - (3,289) 117,097,340 65,417,458 9,532,854 (3,288) 74,947,024 42,150,316

(Unit: Baht)




Useful

lives

1 January

2012 Increase

Transfer in

(transfer

out) Written-off

31

December

2012

1 January

2012 Increase Written-off

31

December

2012

Net

intangible

assets


Software under

installation

- 1,270,342 1,719,430 (2,015,543) - 974,229 - - - - 974,229

Deferred expenses

of membership

fee - Thailand

Futures

Exchanges

- 5,000,000 - - - 5,000,000 1,679,452 - - 1,679,452 3,320,548

Total 80,616,694 13,408,615 - (101,500) 93,923,809 58,918,819 6,599,732 (101,093) 65,417,458 28,506,351

As at 31 December 2013 and 2012, certain computer software items have been fully

amortised but are still in use. The gross carrying amount (before deducting accumulated

amortisation) of those intangible assets amounted to approximately Baht 50 million and Baht

48 million, respectively (consolidated financial statements as at 31 December 2012: Baht 48

million).

19. Other assets

(Unit: Baht)

Consolidated


Separate



Clearing fund 74,415,694 88,619,513 74,415,694

Accrued income 39,093,090 49,785,793 38,926,404

Prepaid expenses 13,911,268 12,323,798 12,655,659

Others 17,803,748 19,357,917 15,673,671

Total 145,223,800 170,087,021 141,671,428

20. Borrowings from financial institutions

As at 31 December 2013 and 2012, borrowings from financial institutions comprising only

domestic borrowings in Baht currency are classified as follows:

(Unit: Baht)


31 December 2012

Interest rate per annum Remaining period to maturity

(percent) At call Within 1 year Total

Financial institutions

Promissory notes 2.86 - 3.00 1,995,000,000 175,000,000 2,170,000,000

Total borrowings from financial

institutions 1,995,000,000 175,000,000 2,170,000,000

(Unit: Baht)


31 December 2013




Promissory notes 2.40 - 2.95 2,575,000,000 - 2,575,000,000


institutions

2,575,000,000 - 2,575,000,000

(Unit: Baht)


31 December 2012




Promissory notes 2.86 - 3.00 1,995,000,000 175,000,000 2,170,000,000


institutions 1,995,000,000 175,000,000 2,170,000,000

21. Securities and derivatives business payables

(Unit: Baht)

Consolidated


Separate



Cash accounts 3,581,245,998 2,728,827,793 3,581,245,998

Payables under securities borrowing and lending business 82,449,545 153,599,520 82,449,545

Guarantee deposit payables 292,465,768 37,091,169 292,465,768

Total securities and derivatives business payables 3,956,161,311 2,919,518,482 3,956,161,311

22. Debt issued and borrowings

As at 31 December 2013 and 2012, debt issued and borrowings are classified as follows:

(Unit: Baht)

Consolidated financial statement

31 December 2012



Other borrowings and debt issued

Borrowings from related company - borrowing

from Maybank Kim Eng Holdings Limited

79,396,584 SGD 0.90 - 2,007,423,532 2,007,423,532

Total other borrowings and debt issued - 2,007,423,532 2,007,423,532

(Unit: Baht)

Separate financial statement

31 December 2013




Debt issued - bill of exchange 2.95 - 3.23 - 2,946,827,927 2,946,827,927


(Unit: Baht)

Separate financial statement

31 December 2012




Borrowings from related company - borrowing

from Maybank Kim Eng Holdings Limited

79,396,584 SGD 0.90 - 2,007,423,532 2,007,423,532


Borrowings from Maybank Kim Eng Holdings Limited are short-term borrowings which will

mature in July 2013.

23. Provisions

(Unit: Baht)

Consolidated


Separate



Balance - beginning of the year 57,765,356 83,025,535 57,428,948

Increase during the year 25,963,964 23,467,930 25,596,587

Balance - end of the year 83,729,320 106,493,465 83,025,535

As at 31 December 2013 and 2012, the provision comprised the obligations of the Company

to Nithipat Capital Public Co., Ltd., (“Nithipat”), the former parent company, of approximately

Baht 11 million in the event that Nithipat is unable to collect securities debts that have not

been transferred as mentioned in the Asset Transfer Letter dated 14 August 1996.

Additional provision is set up for the anticipated liability in respect of the notice that the group

received from a securities trading customer of Yuanta Securities (Thailand) Limited,

demanding the Company pay damages of approximately Baht 16 million for an infringement

that occurred before the customer was transferred to the Company.

In addition, as at 31 December 2013, the Company has post employment benefits, payable

to employees under the Thai labor law in the separate financial statements amounting to

Baht 76 million (note to financial statement 24). In addition, the Company has set aside

provision for dismantling cost amounting to Baht 4 million.

24. Provisions for long-term employee benefits

As at 1 January 2011, the Company and its subsidiary have changed their accounting

policies to bring them in line with TAS 19 Employee Benefits. This accounting standard

requires employee benefits to be recognised as an expense in the period in which service is

performed by the employee. In particular, an entity has to evaluate and make provision for

post-employment benefits using actuarial techniques.

The Company and its subsidiary have changed this accounting policy in the year 2011 and

recognise the liability in the transition period as an expense on a straight-line basis over up to

five years from the date of adoption.

As at 31 December 2013, the Company recognised Baht 34 million of such long-term

employee benefit liabilities and Baht 22 million remains unrecognised as a result of gradual

recognition of liability in the transition period over the five-year period as mentioned above.

Provision for long-term employee benefits as at 31 December 2013 and 2012, was as

follows:

(Unit: Baht)

Consolidated

financial statement

Separate



Defined benefit obligation at beginning of year 72,361,106 86,119,748 71,793,225

Current service cost 14,636,032 12,197,866 14,326,523

Benefits paid during the year - - -

Defined benefit obligation at end of year 86,997,138 98,317,614 86,119,748

Unrecognised transitional provisions (33,983,797) (22,540,128) (33,810,192)

Provisions for long-term employee benefits at

end of year 53,013,341 75,777,486 52,309,556

Long-term employee benefit expenses included in the profit or loss for the years ended

31 December 2013 and 2012 was as follows:

(Unit: Baht)


For the year ended 31 December For the year ended 31 December

2013 2012 2013 2012

Current service cost 12,255,752 14,636,032 12,197,866 14,326,523

Transitional liability recognised during

the year 11,279,709 11,327,932 11,270,064 11,270,064

Total 23,535,461 25,963,964 23,467,930 25,596,587

The Company and its subsidiary recognised these expenses in operating expenses.

The principal actuarial assumptions used to calculate the defined benefit obligations as at

actuarial date are summarised below.

(% per annum)

Discount rate 4

Average future salary increase 4

Average turnover rate 7

25. Liabilities under finance lease agreements

(Unit: Baht)

Consolidated


Separate



Liabilities under finance lease

agreements 19,565,181 20,341,047 17,797,024

Less : Deferred interest expenses (1,996,004) (2,023,559) (1,724,910)

Total 17,569,177 18,317,488 16,072,114

Less : Portion due within one year (5,437,686) (6,657,810) (5,208,444)

Liabilities under finance lease

agreements - net of current

portion 12,131,491 11,659,678 10,863,670

The Company has entered into the finance lease agreements with leasing companies for

rental of motor vehicles for use in its operation, whereby it is committed to pay rental on a

monthly basis. The terms of the agreements are generally 5 years.

Future minimum lease payments required under the finance lease agreements were as

follows:

(Unit: Baht)


31 December 2012

Less than 1

year

1-5 years

Over 5

years

Total

Future minimum lease payments 6,339,970 13,225,211 - 19,565,181

Deferred interest expenses (902,284) (1,093,720) - (1,996,004)

Present value of future minimum lease

payments 5,437,686 12,131,491 - 17,569,177

(Unit: Baht)


31 December 2013

Less than 1

year

1-5 years

Over 5

years

Total


Deferred interest expenses (918,256) (1,105,303) - (2,023,559)


payments 6,657,810 11,659,678 - 18,317,488

(Unit: Baht)


31 December 2012

Less than 1

year

1-5 years

Over 5

years

Total


Deferred interest expenses (807,959) (916,951) - (1,724,910)


payments 5,208,444 10,863,670 - 16,072,114

26. Capital management

The primary objectives of the Company’s capital management are to maintain the

Company’s ability to continue as a going concern and to maintain net capital in accordance

with the rules laid down by the Office of the Securities and Exchange Commission.

27. Statutory reserve

Pursuant to Section 116 of the Public Limited Companies Act B.E. 2535, the Company is

required to set aside a statutory reserve at least 5% of its net income, after deducting

accumulated deficit brought forward (if any), until the reserve reaches 10% of its registered

capital. The statutory reserve is not available for dividend distribution.

28. Dividends

During the years ended 31 December 2013 and 2012, the Annual General Meeting of the

Company’s shareholders approved the payment of dividend as follows:

Dividends Approved by Total dividends Dividend per share

(Million Baht) (Baht)

Dividends for earnings from

1 January 2013 to

30 June 2013

Board of Directors’ Meeting on

14 August 2013

200 0.35

Dividends for the year 2012 Annual General Meeting of the

shareholders on 26 March 2013

514 0.90

Dividends for earnings from

1 January 2012 to

30 June 2012

Board of Directors’ meeting on

8 August 2012

200 0.35

Dividends for the year 2011 Annual General Meeting of the

shareholders on 30 March 2012

467 0.82

29. Brokerage fee

(Unit: Baht)



2013 2012

Brokerage fee from securities business 3,349,584,375 2,256,096,462

Brokerage fee from derivatives business 268,991,298 264,974,656

Total brokerage fee 3,618,575,673 2,521,071,118

30. Fees and service income

(Unit: Baht)

Consolidated


Separate


For the years ended

31 December

For the years ended

31 December

2013 2012 2013 2012

Underwriting fee 16,513,350 34,931,463 16,513,350 34,931,463

Financial advisory 32,696,532 22,718,734 32,696,532 22,718,734

Securities borrowing and lending 14,901,535 13,765,303 14,901,535 13,765,303

Others 7,943,381 6,402,229 8,102,625 7,252,549

Total fees and service income 72,054,798 77,817,729 72,214,042 78,668,049

31. Directors’ remuneration

Directors’ remuneration represents the benefits (exclusive of salaries, bonus, and related

benefits payable to executive directors) paid to directors of the Company and its subsidiary in

accordance with Section 90 of the Public Limited Companies Act.

Directors’ remuneration of the current year included adjustments made by reversing

remuneration of directors for the year 2012. As at 31 December 2012, the Company

estimated and recorded directors’ remuneration based on the amounts approved for the year

2012 and subsequently adjusted it when the amounts approved by the Annual General

Meeting of shareholders were know.

32. Provident fund

The Company, its subsidiary and their employees have jointly established a provident fund in

accordance with the Provident Fund Act B.E. 2530. Employees contributed to the fund

monthly at the rate of 3 percent of basic salary and the Company and its subsidiary

contributed to the fund monthly at the rate of 2-8 percent. The funds of the Company and its

subsidiary are managed by TMB Asset Management Company Limited. The funds will be

paid to employees upon termination in accordance with the rules of the fund. During the

years ended 31 December 2013 and 2012, Baht 29 million and Baht 26 million, respectively

were contributed to the fund by the Company and its subsidiary (separate financial

statements: Baht 29 million and Baht 26 million, respectively).

33. Deferred tax assets/liabilities and income tax expenses

33.1 Deferred tax assets/liabilities

Deferred tax assets and deferred tax liabilities consisted of tax effects on each type of

transactions as follows:

(Unit: Baht)


31 December 2012 1 January 2012


Deferred tax assets

Allowance for doubtful accounts - others 2,692,619 3,119,512

Accrued expenses 8,742,891 6,462,874

Provisions for long-term employee benefits 10,461,911 6,143,983

Others 4,467,432 5,143,626

Total deferred tax assets 26,364,853 20,869,995

(Unit: Baht)


31 December 31 December 1 January

2013 2012 2012


Deferred tax assets

Allowance for doubtful accounts - others 2,680,627 2,692,619 3,119,512

Allowance for impairment loss on investment in

subsidiaries

-

9,861,369 -

Accrued expenses 5,278,890 8,742,891 6,462,874

Provisions for long-term employee benefits 15,155,497 10,461,911 6,143,983

Others 4,107,723 4,467,432 5,143,626

Total deferred tax assets 27,222,737 36,226,222 20,869,995

Reconciliation between income tax expenses and the product of accounting profits and the

applicable tax rates for the years ended 31 December 2013 and 2012 are as follows:

(Unit: Baht)



2013 2012 2013 2012


Accounting profits before income tax expenses

from continuing operations 1,804,659,358 1,021,888,851 1,786,169,886 974,286,805

Applicable corporate income tax rate 20% 23% 20% 23%

Amounts of income taxes at the applicable tax rate 360,931,872 235,034,436 357,233,978 224,085,965

Adjustment of income tax expenses of previous

years 32,782 1,122,956 32,782 1,122,956

Tax effect of non-deductible expenses 8,366,732 7,768,812 8,366,732 7,768,812

Effect of net - temporary differences (13,559,263) 4,205,399 - 5,292,501

Income tax expenses reported in the statement of

comprehensive income 355,772,123 248,131,603 365,633,492 238,270,234

33.2 Income tax expenses

Income tax expenses for the years ended 31 December 2013 and 2012 are made up as

follows:

(Unit: Baht)

Consolidated


Separate



2013 2012 2013 2012


Current income tax:

Current corporate income tax charge 356,630,007 253,626,461 356,630,007 253,626,461

Deferred tax:

Relating to origination and reversal

of temporary differences (857,884) (5,494,858) 9,003,485 (15,356,227)

Income tax expense reported in the

statements of comprehensive

income 355,772,123 248,131,603 365,633,492 238,270,234

34. Earnings per share

Basic earnings per share is calculated by dividing the net earnings for the year by the

weighted average number of ordinary shares held by outside shareholders in issue during

the year, net from the treasury shares held by the Company.

Consolidated


Separate


For the years ended

31 December

For the years ended

31 December

2013 2012 2013 2012


Beginning balance of the year - weighted average

number of ordinary shares (shares) 570,814,500 569,169,300 570,814,500 569,169,300

Weighted average number of treasury shares sold

during the year (shares) - 1,335,084 - 1,335,084

Ending balance of the year - weighted average number

of ordinary shares (shares) 570,814,500 570,504,384 570,814,500 570,504,384

Profit for the year - from continuing operations (Baht) 1,448,887,235 773,757,249 1,420,536,394 736,016,571

Earnings per share - from continuing operations

(Baht/share) 2.54 1.36 2.49 1.29

35. Related party transactions

During the years ended 31 December 2013 and 2012, the Company had significant business

transactions with the following related parties.

Company’s name and related person Relationship

Maybank Kim Eng Holdings Limited Parent company

Mayban IB Holdings Sdn Bhd Shareholder of parent company

Maybank Asset Management (Thailand) Co., Ltd. (formerly known as

“Kim Eng Asset Management (Thailand) Co., Ltd.”)

Fellow subsidiary of the Group

Maybank Kim Eng Securities Pte. Ltd. Fellow subsidiary

Kim Eng Securities (Hong Kong) Limited Fellow subsidiary

Maybank Kim Eng Investment Limited Fellow subsidiary

Maybank Asset Management Group Berhad Fellow subsidiary

Such related parties transactions have been concluded on commercial terms and bases agreed

upon in the ordinary course of businesses between the Company and those related parties.

Below is a summary of those transactions.

(Unit: Million Baht)

Consolidated financial

statements

Separate financial

statements

For the years ended

31 December

For the years ended

31 December Pricing policies

2013 2012 2013 2012

Transactions with related parties

Rental and service income In accordance with service agreements

Maybank Asset Management (Thailand)

Co., Ltd.

1 - 1 2

Brokerage fee income At normal rate charged to other clients,

in accordance with SET’s and SEC’s

notification

Maybank Kim Eng Securities Pte. Ltd. 55 29 55 29

Kim Eng Securities (Hong Kong) Limited 5 3 5 3

Fee and service expenses In accordance with agreement

Maybank Kim Eng Securities Pte. Ltd. 2 - 2 -

Brokerage expenses In accordance with agreement


Rental expenses In accordance with agreement

Maybank Asset Management (Thailand)

Co., Ltd.

0.8 - 0.9 -

Interest expenses on borrowings In accordance with borrowings

Maybank Kim Eng Holdings Limited 54 4 54 4 agreement

Information technology service expenses At the price agreed upon by both parties

Maybank Kim Eng Holdings Limited - 3 - 3 referencing the market price.

Consulting service fee In accordance with service agreements


Kim Eng Securities (Hong Kong) Limited 5 - 5 -

Dividend paid As declared

Maybank Kim Eng Holdings Limited 594 556 594 556

Maybank Kim Eng Investment Limited 2 2 2 2

Gain on sale of investment in subsidiary Sale price Baht 51 million, refer to net

Maybank Asset Management Group

Berhad

19 - - - assets values as at 30 June 2012

As at 31 December 2013 and 2012, the outstanding balances of the above transactions, as

presented in the statements of financial position are as follows:


Consolidated

financial

statements

Separate financial

statements Pricing Policies

31 December

2012

31 December

2013

31 December

2012

Related companies

Other receivables No interest charged

Maybank Asset Management (Thailand) Co., Ltd. - 0.30 0.4

Securities business receivables No interest charged

Maybank Kim Eng Securities Pte. Ltd. 59 65 59

Kim Eng Securities (Hong Kong) Limited 1 3 1

Foreign securities company receivables No interest charged


Foreign deposits receivables No interest charged

Maybank Kim Eng Securities Pte. Ltd. 1,248 87 1,248

Prepaid consulting fee In accordance with service

Maybank Kim Eng Securities Pte. Ltd. 4 1 4 agreement

Borrowings Differential between the local cost of

Maybank Kim Eng Holdings Limited 2,007 - 2,007 borrowing and the SGD/THB swap

cost

Securities business payables No interest charged


Kim Eng Securities (Hong Kong) Limited 4 27 4

Foreign securities company payables No interest charged


Accrued consulting fee In accordance with service agreement

Kim Eng Securities (Hong Kong) Limited - 5 -

Dividend payable As declared

Maybank Kim Eng Holdings Limited 166 - 166

Loans from related parties

As at 31 December 2013 and 2012, the balance of loans between the Company and the

related company and the movement are as follows:



Balance as at Increase Decrease Balance as at

Loans from related parties Related by 31 December 2012 during the year during the year 31 December 2013

Maybank Kim Eng Holdings

Limited Parent company 2,007 4,500 6,507 -

Total 2,007 4,500 6,507 -



Balance as at Increase Decrease Balance as at

Loans from related parties Related by 31 December 2011 during the year during the year 31 December 2012

Maybank Kim Eng Holdings

Limited Parent company - 2,007 - 2,007

Total - 2,007 - 2,007

On 1 July 2013, the Company signed the information technology service agreement with the

parent company in Singapore for a period of 1.5 years and has been committed to pay fee at

the rate specified in the agreement. On 1 January 2013, the Company terminated this

service agreement.

As at 31 December 2013, Maybank Kim Eng Holdings Ltd. guaranteed the overdraft facilities

amounting to Baht 330 million (31 December 2012: Baht 330 million). There is no overdraft

outstanding balance as at 31 December 2013.

As at 31 December 2013, the Company had loans to employees under welfare program

amounting to Baht 297 million. The loans charged interest at rate of 2.52, 2.90 percent per

annum (31 December 2012: Baht 289 million, interest at rate of 2.50, 3.30 percent per

annum).

Management’s remuneration

During the years ended 31 December 2013 and 2012, benefits paid to management of the

Company and its subsidiary both monetary and non-monetary, which presented as part of

“Personnel expenses”, are as follows:

(Unit: Baht)

Consolidated and separate


Consolidated and separate


For the years ended

31 December

For the years ended

31 December

2013 2012 2013 2012

Management’s remuneration

Short-term employee benefits 272,741,596 220,484,665 272,741,596 204,684,435

Post-employment benefits 4,488,849 4,549,868 4,488,849 4,279,552

277,230,445 225,034,533 277,230,445 208,963,987

36. Segment information

Operating segment information is reported in a manner consistent with the internal reports

that are regularly reviewed by the chief operating decision maker in order to make decisions

about the allocation of resources to the segment and assess its performance.

For management purposes, the Company and its subsidiaries are organised into business

units based on its products and services and have two reportable segments as follows:

Securities business segment, which provide service according to brokering and

derivative brokering and securities borrowing and lending.

Investment banking segment, which provide service according to underwriting,

investment advisory, securities borrowing and lending and corporate finance advisory.

The chief operating decision maker monitors the operating results of the business units

separately for the purpose of making decisions about resource allocation and assessing

performance. Segment performance is measured based on operating profit or loss and on a

basis consistent with that used to measure operating profit or loss in the financial statements.

However, the Company and its subsidiary income taxes is managed on a Group basis and

are not allocated to operating segments.

Transfer prices between operating segments are on an arm’s length basis in a manner

similar to transactions with third parties.

Inter-segment revenues are eliminated on consolidation.

The following tables present revenue and profit information regarding the Company’s

operating segments for the years ended 31 December 2013 and 2012, respectively.



Securities

business

segment

Investment

banking

segment

Total

segments

Adjustment

and

eliminations Consolidated

Income

External customers

Brokerage fee 3,615 4 3,619 - 3,619

Fee and service income 21 51 72 - 72

Interest on deposit and credit

balance accounts 966 -

966

- 966

Other income 98 1 99 - 99

Total income 4,700 56 4,756 - 4,756

Expenses

Financial cost 459 - 459

Fee and service expenses 274 - 274

Personnel expenses 1,683 - 1,683

Other expenses 554 - 554

Total expenses 2,970 - 2,970

Segment profit 1,786 - 1,786

Gain on sale investment in subsidiary - 19 19

Profit before income tax expenses 1,786 19 1,805

Income tax expenses (366) 10 (356)

Profit from continuing operations 1,420 29 1,449

Loss from discontinued operations - (3) (3)

Profit for the year 1,420 26 1,446



2012

Securities

business

segment

Investment

banking

segment

Total

segments

Adjustment and

eliminations Consolidated

Income

External customers

Brokerage fee 2,521 - 2,521 - 2,521

Fee and service income 21 58 79 (1) 78

Interest on deposit and credit

balance accounts 581 -

581

- 581

Other income 52 1 53 (1) 52

Total income 3,175 59 3,234 (2) 3,232

Expenses

Financial cost 210 - 210

Fee and service expenses 206 - 206

Personnel expenses 1,240 - 1,240

Other expenses 554 - 554

Total expenses 2,210 - 2,210

Segment profit 1,024 (2) 1,022

Gain on sale investment in

subsidiary

(49)

49 -

Profit before income tax expenses 975 47 1,022

Income tax expenses (238) (10) (248)

Profit from continuing operations 737 37 774

Loss from discontinued operations - (30) (30)

Profit for the year 737 7 744

The following table presents segment assets of the Company’s operating segments as at

31 December 2013 and 2012:


Segment assets

Securities

business

segment

Investment

banking

segment

Total

Segments

Unallocated

assets Consolidated

At 31 December 2013 13,114 4 13,118 1,567 14,685

At 31 December 2012 13,035 2 13,037 963 14,000

37. Commitments and contingent liabilities

37.1 Significant contingent liabilities are as follows:

1) The Company and its subsidiary have the significant outstanding commitments under

office space, office equipment, and other service agreements are as follows:


Consolidated financial

statement Separate financial statements


Payable:

In up to 1 year 83 91 82

In over 1 and up to 5 years 41 115 39

2) As at 31 December 2013 and 2012, future minimum lease payments required under the

finance lease agreements were as follows:



31 December 2012

Less than

1 year

1-5 years

Total

Future minimum lease payments 7 13 20

Deferred interest expenses (1) (1) (2)

Present value of future minimum lease payments 6 12 18



31 December 2013

Less than

1 year

1-5 years

Total






31 December 2012

Less than

1 year

1-5 years

Total




38. Financial instruments

Financial instruments are any contract which gives rise to both a financial asset of one entity

and a financial liability or equity instrument of another entity in the meantime.

38.1 Financial risk management

Financial instruments of the Company and its subsidiary principally comprise cash and cash

equivalents, deposits at financial institutions, derivative assets, investments, receivables

from and payables to Clearing House, borrowings from financial institutions, securities and

derivatives business receivables and payables, derivative liabilities and debt issued and

borrowings. The financial risks associated with these financial instruments and how they are

managed is described below.

38.2 Credit risk

The Company is exposed to credit risk primarily with respect to securities and futures

business receivables. The Company manages the risk by establishing trading credit

approval limit for client, performing credit review and increasing credit limit at both of

committee and individual level subject to credit level. In addition, the Company assigns

Credit Committee to control and monitor the credit risk. Therefore, the Company does not

expect to incur material financial losses. In addition, the Company does not have high

concentration of credit risk since it has a large customer base. The maximum exposure to

credit risk is limited to the book value of securities and derivatives business receivables,

derivative assets and receivables from foreign securities company as stated in the statement

of financial position.

38.3 Market risk

Market risk is the risk that changes in interest rates, foreign exchange rates and securities

prices may have an effect on the Company’s position and investment status. As such,

market risk consists of interest rate risk, foreign exchange risk and equity/commodities

position risk.

a) Interest rate risk

Interest rate risk is the risk that the value of financial assets and liabilities will fluctuate

due to changes in market interest rates. However, since most of the Company’s financial

assets and liabilities will mature in 1 year or has floating interest rate, the Company’s

interest rate risk is expected to be low.

As at 31 December 2013 and 2012, significant financial assets and liabilities classified

by type of interest rates are summarised in the table below.



Outstanding balance of financial instruments as at 31 December 2012

Fixed interest rates

Interest rate

(% p.a.)

Remaining period to the contractual

repricing date or maturity date

Floating

interest rate

Within 1

year 1 - 5 years

Over 5

years

Without

interest

Non-

performing

debts Total

Floating

interest rate

Fixed

interest rate

Financial assets

Cash and cash equivalents 76 24 - - 201 - 301 0.25 - 2.50 3.05

Deposits at financial institutions - 3 - - - - 3 - 1.70 - 2.10

Receivable from Clearing House - - - - 1,245 - 1,245 - -

Securities and derivatives business

receivables 8,776 82 - - 2,779 247 11,884 5.42 - 5.50 5.50, 8.50

Loans to employees under welfare program 289 - - - - - 289 2.50, 3.30 -

Financial liabilities

Borrowings from financial institutions 2,170 - - - - - 2,170 2.86 - 3.00 -

Payable to Clearing House - - - - 452 - 452 - -

Securities and derivatives business payables 293 82 - - 3,581 - 3,956 1.90 3.00 , 5.50

Derivative liabilities - - - - 24 - 24 - -

Debt issued and borrowings - 2,007 - - - - 2,007 - 0.90

Liabilities under financial lease agreements - 6 12 - - - 18 - 5.20 - 11.25





Interest rate

(% p.a.)



Floating

interest

rate

Within 1

year 1 - 5 years Over 5 years

Without

interest

Non-

performing

debts Total

Floating

interest rate

Fixed

interest rate

Financial assets

Cash and cash equivalents 605 - - - 268 - 873 0.25 - 1.80 -


Receivable from Clearing House - - - - 319 - 319 - -


receivables 10,120 152 - - 2,312 246 12,830 5.39 - 6.50 5.50 - 8.50





Securities and derivatives business payables 37 154 - - 2,729 - 2,920 1.90 3.00 - 5.50


Debt issued and borrowings - 2,947 - - - - 2,947 - 2.95 - 3.23






Interest rate

(% p.a.)



Floating

interest

rate

Within 1

year 1 - 5 years Over 5 years

Without

interest

Non-

performing

debts Total

Floating

interest rate

Fixed

interest rate

Financial assets

Cash and cash equivalents 71 - - - 201 - 272 0.25 - 2.50 -


Receivable from Clearing House - - - - 1,245 - 1,245 - -


receivables 8,776 82 - - 2,779 247 11,884 5.42 - 5.50 5.50, 8.50





Securities and derivatives business payables 293 82 - - 3,581 - 3,956 1.90 3.00, 5.50


Debt issued and borrowings - 2,007 - - - - 2,007 - 0.90


b) Foreign exchange risk

Foreign exchange risk is the risk that changes in foreign exchange rates may result in

changes in the value of financial instruments, and fluctuations in revenues or the values

of financial assets and liabilities.

The balance of financial assets and liabilities denominated in foreign currencies are

summarised below.

Foreign currency

Financial assets

as at


as at

Exchange rate

as at 31 December 2013

Exchange rate

as at 31 December 2012

31 December

2013

31 December

2012

31 December

2013

31 December

2012

Buying

Selling

Buying

Selling

(Million Baht) (Million Baht) (Million Baht) (Million Baht) (Baht per 1 foreign

currency unit)

(Baht per 1 foreign

currency unit)

Hong Kong dollar 4 270 4 270 4.2044 4.2587 3.9207 3.9813

Singapore dollar 8 8 8 87 25.6485 26.1167 24.7844 25.2835

US dollar 85 1 84 1 32.6778 32.9494 30.4857 30.7775

Forward exchange contracts outstanding at 31 December 2012 are summarised below.

Foreign currency Bought amount

Contractual exchange rate

Bought

Contractual maturity

date

(Baht per 1 foreign currency

unit)

Singapore dollar 79,396,584 25.1530 11 January 2013

38.4 Liquidity risk

Liquidity risk is the risk that the Company and its subsidiary will be unable to liquidate

financial assets and/or procure sufficient funds to discharge obligations in a timely manner,

resulting in a financial loss.

The maturity dates of financial instruments held as of 31 December 2013 and 2012, counting

from the financial position date, are as follows.




At call

Within 1

year 1 - 5 years

Over 5

years

No

maturity

Non-

performing

debts Total

Financial assets

Cash and cash equivalents 277 24 - - - - 301

Deposits at financial institutions - 3 - - - - 3

Receivable from Clearing House - 1,245 - - - - 1,245

Securities and derivatives business receivables 82 2,779 - - 8,776 247 11,884

Loans to employees under welfare program - 43 122 124 - - 289


Borrowings from financial institutions 1,995 175 - - - - 2,170

Payable to Clearing House - 452 - - - - 452

Securities and Derivatives business payables 375 3,581 - - - - 3,956

Derivative liabilities - 24 - - - - 24

Debt issued and borrowings - 2,007 - - - - 2,007

Liabilities under financial lease agreements - 6 12 - - - 18




At call

Within 1

year 1 - 5 years

Over 5

years

No

maturity

Non-

performing

debts Total

Financial assets Cash and cash equivalents 873 - - - - - 873


Receivable from Clearing House - 319 - - - - 319

Securities and derivatives business receivables 2,312 152 - - 10,120 246 12,830





Securities and Derivatives business payables 191 2,729 - - - - 2,920







At call

Within 1

year 1 - 5 years

Over 5

years

No

maturity

Non-

performing

debts Total

Financial assets

Cash and cash equivalents 272 - - - - - 272


Receivable from Clearing House - 1,245 - - - - 1,245

Securities and derivatives business receivables 82 2,779 - - 8,776 247 11,884





Securities and derivatives business payables 375 3,581 - - - - 3,956




38.5 Fair value of financial instruments

Fair value represents the amount for which an asset could be exchanged or a liability settled

between knowledgeable, willing parties in an arm’s length transaction. The Company and its

subsidiary have estimated the fair value of financial instruments as follows:

a) Financial assets

The method used for determining the fair value is dependent upon the characteristics of

the financial instruments. The fair values of financial assets including cash and cash

equivalents, receivables from Clearing House and securities and derivatives business

receivable are considered to approximate their respective carrying values since the

financial instruments are predominantly subject to market interest rates or will be due in

a short period. The fair values of financial instruments that have standard terms and

conditions and are traded on an active and liquid market, such as investments, are

determined based on the quoted market price.

b) Financial liabilities

Borrowings from financial institutions, payables to Clearing House and securities and

derivatives business payables are presented at their book value since they mature in

the short-term.

As of 31 December 2013, there are no material differences between the book value of

financial instruments and their fair value.

39. Discontinued operations

On 21 March 2013, the Company sold its investment in Maybank Asset Management (Thailand)

Company Limited (formerly known as “Kim Eng Asset Management (Thailand) Company

Limited”), which was a subsidiary company, and has already received payment.

The operating results of subsidiary company, presented under the caption of “Loss from

discontinued operations” in the consolidated statements of comprehensive income of the

Company for the years ended 31 December 2013 and 2012, are as follows:

(Unit: Baht)


2013 2012

Fee and service incomes 793,100 2,579,290

Interest and dividend income 116,809 1,295,259

Other income 11,625 71,591

Total income 921,534 3,946,140

Finance cost 8,446 109,290

Fee and service expenses 271,271 1,086,825

Operating expenses 3,704,811 32,608,605

Total expenses 3,984,528 33,804,720

Loss from discontinued operations (3,062,994) (29,858,580)

(Unit: Baht)


2013 2012

Earnings per share

Basic earnings (loss) per share

Loss from discontinued operations (0.01) (0.05)

40. Approval of financial statements

These financial statements were authorised for issue by the Company’s Board of Directors

on 11 February 2014.

Documents

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