THAILAND EQUITY RESEARCH

Page | 1 | PHILLIP SECURITIES (THAILAND)

Closing Price(Bt) 149.00

Target Price(Bt) 186.00 (+29.19%)

COMPANY DATA

O/S Shares (mn) : 1,909

Market Cap. (Btmn) :

Market Cap. (USDmn) :

52-WK Hi/Lo (Bt) : 197/144

3M Average Daily T/O (mn) : 3.73

Par Value (Bt) : 10.00

MAJOR SHAREHOLDERS (%)

1. Thai NVDR 33.9

2. CHASE NOMINEES LIMITED 3.4

3. The Thailand Securities Depository Co., Ltd. 3.0

PRICE PERFORMANCE (%)

1MTH 3MTH 1YR

ABS -7% -9% -18%

REL TO SET INDEX 17% 15% -14%

PRICE VS SET INDEX

Source: Bloomberg, PSR

KEY FINANCIALS

FYE Dec FY14 FY15E FY16E FY17E

Revenue(Btbn) 97 102 106 114

Net Profit(Btbn) 36 36 36 39

EPS (Bt) 19.03 18.64 18.99 20.42

P/E (X) 7.8 8.0 7.8 7.3

BVPS (Bt) 169.47 191.08 195.39 209.17

P/B (X) 0.9 0.8 0.8 0.7

DPS (Bt) 6.50 6.50 6.75 7.25

Dividend Yield (%) 4.4 4.4 4.5 4.9

ROE (%) 11.73 10.34 9.83 10.09

Debt/Equity (X) 8.53 7.75 8.12 8.04

Source: Company, PSR Est.

**Multiples and yields are based on latest closing price

VALUATION METHOD

P/B'16 (1x)

Adisorn Mungparnchon

Securities Investment Analyst # 18577

Tel: 66 2 635 1700 # 497

7,853

11 September 2015

Buy (Maintain)

07 January 2016

284,418

0

100

200

300

400

Jan-13 Jan-14 Jan-15 Jan-16

BBL TB EQUITY SETI (rebased)

Bangkok Bank

4QFY15 net profit looks flat q-q

THAILAND | SET | BANK | COMPANY PREVIEW BLOOMBERG BBL TB l REUTERS BBL.BK

4QFY15 net profit expected at Bt9bn, flat q-q but up 4% y-y We expect BBL to deliver 4QFY15 net profit of Bt9bn. Comparing to the prior quarter, the profit seems to be flat despite potential increase in interest income and decrease in loan-loss provision, as the bank will normally shoulder heavier burden on expenses in the final quarter of year and gains on investment are likely to decline. On y-y basis, the profit would rise by 4% as the potential increases in interest and non-interest income, and lower expense are expected to offset higher loan-loss provision. Loan likely to accelerate late year, FY16 loan growth target set at the same pace to GDP BBL’s loan accelerated in late year. We expect FY15 loan to grow by a roughly 4.6% on the back of strong growth in SME and retail loans amid slowdown in corporate loan. For 2016, BBL sets its loan growth target at the same pace to the country’s GDP growth forecast and expects large corporations, which delayed their investments in 2015, to resume investments this year. NPL likely to rise in 4QFY15 and further into 2016 but the growth pace appears to slow down NPL looks likely to increase further in 4QFY15 after BBL recorded NPL of 2.8% of total loan. However, the pace of growth appears to slow down. We estimate NPL at 2.9% of total loan at end-2015. In 2016, NPL is forecast to grow further in 2016 but its pace would slow down, which should allow BBL to set aside lower loan-loss provision this year, compared to our estimated Bt14bn in 2015. FY15 net profit to be achieved at Bt36bn, FY16 earnings likely to grow slightly If the fourth-quarter earnings come in as expected, BBL will achieve FY15 net profit at Bt36bn and we expect the bank to pay dividend of Bt6.50/share, a similar level to a year earlier. For 2016, loan is expected to grow further but most of which would come from corporate loan that yields moderate return, and thus net profit would grow by a mere 1.9%. ‘BUY’ rating maintained with Bt186/share target price With the bank’s strong relationship with large corporations, we believe BBL will benefit from provide loans to bid winners of the government’s mega infrastructure projects and to private parties. We reiterate a ‘BUY’ rating with a target price of Bt186/share.

Ref. No.: CO2016_0010

THAILAND EQUITY RESEARCH

PHILLIP SECURITIESS (THAILAND) | 2 | P a g e

Income Statement

Btmn 4Q15F 3Q15 4Q14 q-q+/- y-y+/- 2015F 2014 y-y+/-

Interest income 25,865 25,742 26,299 0% -2% 104,005 103,480 1%

Interest expense -11,270 -11,301 -11,440 0% 1% -47,517 -44,483 -7%

Net interest income 14,595 14,441 14,860 1% -2% 56,488 58,997 -4%

Fees and service income 8,020 7,940 7,660 1% 5% 31,809 29,161 9%

Fees and service expenses -1,946 -1,927 -1,909 -1% -2% -7,903 -7,435 -6%

Net fees and service income 6,073 6,013 5,752 1% 6% 23,906 21,726 10%

Other non-interest income 5,222 6,285 3,222 -17% 62% 21,829 16,134 35%

Total Income 11,295 12,299 8,973 -8% 26% 45,735 37,860 21%

Operating expense 10,979 10,948 12,057 0% -9% 43,892 43,087 2%

Pre provioning profit 14,911 15,791 11,776 -6% 27% 58,331 53,770 8%

Impairment loss of loans and debt securities -3,550 -4,872 -939 27% -278% -14,324 -8,687 -65%

Profit from operating before income tax expense 11,361 10,919 10,836 4% 5% 44,007 45,084 -2%

Taxation -2,215 -1,810 -2,028 -22% -9% -8,203 -8,593 5%

Minority 59 51 45 15% 31% 218 159 37%

Net profit 9,087 9,057 8,763 0% 4% 35,586 36,332 -2%

EPS (Bt) 4.76 4.74 4.59 0% 4% 18.64 19.03 -2%

Key Financial Ratio

% 4Q15F 3Q15 4Q14 q-q+/- y-y+/- 2015F 2014 y-y+/-

Yield on Earning Asset 3.70% 3.70% 4.03% 0% -8% 3.80% 3.95% -4%

Cost of Fund 1.89% 1.89% 2.04% 0% -7% 2.03% 1.96% 4%

Spread 1.81% 1.81% 1.99% 0% -9% 1.77% 1.99% -11%

NIM 2.09% 2.08% 2.28% 0% -8% 2.07% 2.25% -8%

NPL 2.90% 2.80% 2.10% 4% 38% 2.90% 2.10% 38%

Balance Sheet

Btbn 4Q15F 3Q15 4Q14 q-q+/- y-y+/- 2015F 2014 y-y+/-

Assets 2,784 2,821 2,760 -1% 1% 2,784 2,760 1%

Liabil ities 2,465 2,466 2,436 0% 1% 2,465 2,436 1%

Paid-up (mn shrs) - Par Bt10 1,909 1,909 1,909 0% 0% 1,909 1,909 0%

Equities 365 355 324 3% 13% 365 324 13%

BVPS (Bt) 191.18 186.07 169.55 3% 13% 191.18 169.55 13%

Loan/deposit (%) 89% 88% 87% 2% 3% 89% 87% 3%

Bangkok Bank COMPANY PREVIEW

THAILAND EQUITY RESEARCH

PHILLIP SECURITIESS (THAILAND) | 3 | P a g e

Corporate Governance -2015

ADVANC BAFS BCP BIGC BTS CK CPN DRT DTAC DTC

EASTW EGCO GRAMMY HANA HMPRO INTUCH IRPC IVL KBANK KCE

KKP KTB LHBANK LPN MCOT MINT MONO NKI PHOL PPS

PS PSL PTT PTTEP PTTGC QTC RATCH ROBINS SAMART SAMTEL

SAT SC SCB SCC SE-ED SIM SNC SPALI THCOM TISCO

TKT TMB TOP VGI WACOAL

AAV ACAP AGE AHC AKP AMATA ANAN AOT APCS ARIP

ASIMAR ASK ASP BANPU BAY BBL BDMS BECL BKI BLA

BMCL BOL BROOK BWG CENTEL CFRESH CHO CIMBT CM CNT

COL CPF CPI CSL DCC DELTA DEMCO ECF EE ERW

GBX GC GFPT GLOBAL GUNKUL HEMRAJ HOTPOT HYDRO ICC ICHI

INET IRC KSL KTC LANNA LH LOXLEY LRH MACO MBK

MC MEGA MFEC NBC NCH NINE NSI NTV OCC OGC

OISHI OTO PAP PDI PE PG PJW PM PPP PR

PRANDA PREB PT PTG Q-CON QH RS S & J SABINA SAMCO

SCG SEAFCO SFP SIAM SINGER SIS SITHAI SMK SMPC SMT

SNP SPI SSF SSI SSSC SST STA STEC SVI SWC

SYMC SYNTEC TASCO TBSP TCAP TF TGCI THAI THANA THANI

THIP THRE THREL TICON TIP TIPCO TK TKS TMI TMILL

TMT TNDT TNITY TNL TOG TPC TPCORP TRC TRU TRUE

TSC TSTE TSTH TTA TTCL TTW TU TVD TVO TWFP

TWS UAC UT UV VNT WAVE WINNER YUASA ZMICO

2S AEC AEONTS AF AH AIRA AIT AJ AKR AMANAH

AMARIN AP APCO AQUA AS ASIA AUCT AYUD BA BEAUTY

BEC BFIT BH BIG BJC BJCHI BKD BTNC CBG CGD

CHG CHOW CI CITY CKP CNS CPALL CPL CSC CSP

CSS CTW DNA EARTH EASON ECL EFORL ESSO FE FIRE

FOCUS FORTH FPI FSMART FSS FVC GCAP GENCO GL GLAND

GLOW GOLD GYT HTC HTECH IEC IFEC IFS IHL IRCP

ITD JSP JTS JUBILE KASET KBS KCAR KGI KKC KTIS

KWC KYE L&E LALIN LHK LIT LIVE LST M MAJOR

MAKRO MATCH MATI MBKET M-CHAI MFC MILL MJD MK MODERN

MOONG MPG MSC MTI MTLS NC NOK NUSA NWR NYT

OCEAN PACE PATO PB PCA PCSGH PDG PF PICO PL

PLANB PLAT PPM PRG PRIN PSTC PTL PYLON QLT RCI

RCL RICHY RML RPC S SALEE SAPPE SAWAD SCCC SCN

SCP SEAOIL SIRI SKR SMG SOLAR SORKON SPA SPC SPCG

SPPT SPVI SRICHA SSC STANLY STPI SUC SUSCO SUTHA SYNEX

TAE TAKUNI TCC TCCC TCJ TEAM TFD TFI TIC TIW

TLUXE TMC TMD TOPP TPCH TPIPL TRT TSE TSR UMI

UP UPF UPOIC UREKA UWC VIBHA VIH VPO WHA WIN

XO

Score Range

< 50%

50-59%

60-69%

70-79%

80-89%

90-100%

The disclosure of the survey result of the Thai Institute of Directors Association (IOD)

regarding corporate governance is made pursuant to the Office of the Securities and

Exchange Commission. The survey of the IOD is based on the information of a company

l isted on the Stock Exchange of Thailand and the Market for Alternative disclosure to the

public and able to be accessed by a general public investor. The results, therefore, is from

the perspective of a third party. It is not an evaluation of operation and is not based on

inside information.

The survey result is as of the date appearing in the Corporate Governance Report of Thai

Listed Companies. As a result, the survey result may be changed after that data. Phil l ip

Securities (Thailand) of securities company does not confirm nor certify the accuracy of

such survey result.

No logo given

Number of Logo

Results Presentation

THAILAND EQUITY RESEARCH

PHILLIP SECURITIESS (THAILAND) | 4 | P a g e

Industry Group Name Sector Name Sector Index

Agro & Food Industry[AGRO] Agribusiness AGRI

Food & Beverage FOOD

Consumer Products[CONSUMP] Fashion FASHION

Home & Office Products HOME

Personal Products & Pharmaceuticals PERSON

Financials [FINCIAL] Banking BANK

Finance & Securities FIN

Insurance INSUR

Industrials [INDUS] Automotive AUTO

Industrial Materials & Machinery IMM

Packaging PKG

Paper & Printing Materials PAPER

Petrochemicals & Chemicals PETRO

Steel STEEL

Property & Construction[PROPCON] Construction Materials CONMAT

Construction Services CONS

Property Development PROP

Property Fund & REITs PF&REIT

Resources [RESOURC] Energy & Uti l ities ENERG

Mining MINE

Services [SERVICE] Commerce COMM

Media & Publishing MEDIA

Health Care Services HELTH

Tourism & Leisure TOURISM

Professional Services PROF

Transportation & Logistics TRANS

Technology [TECH] Electronic Components ETRON

Information & Communication Technology ICT

PSR Rating SystemCapital Gain Recommendation

> 15% BUY

> 5% - 15% ACCUMULATE / TRADING BUY

> 0% - 5% NEUTRAL

0 <= SELL

Remarks

We do not base our recommendations entirely on the above quantitative return bands. We consider qual itative factors l ike (but

not l imited to) a stock's risk reward profi le, market sentiment, recent rate of share price appreciation, presence or absence of

stock price catalysts, and speculative undertones surrounding the stock, before making our final recommendation

22776846