BANGKOK, Thailand and TORONTO, Canada, March 29 /CNW/ - Scotiabank today
announced that it has reached an agreement to acquire 24.99 per cent of
Thanachart Bank, Thailand's eighth-largest bank and leading automobile lender,
for Bht7.1 billion (approximately Cdn$240 million). Scotiabank will purchase
157,130,216 shares from Thanachart Capital and 276,263,200 new shares issued
by Thanachart Bank at Bht16.37 per share.
The transaction is subject to the completion of definitive documents and
regulatory approval and is expected to close by June 30, 2007. The transaction
will provide for proportionate Scotiabank representation on the Thanachart
board of directors, as well as strong participation in Thanachart Bank
Scotiabank's agreement also contains provisions to increase its ownership
stake up to 49 per cent for an equivalent price by December 31, 2007, should
legislation allow, subject to a one-year extension and further call rights for
a four-year period.
"This agreement provides for the acquisition of a significant stake in
Thanachart Bank, demonstrating our commitment to finding opportunities to
drive revenue growth," said Rick Waugh, Scotiabank President and Chief
Executive Officer (CEO). "Scotiabank is optimistic about Thailand's growth
potential and we look forward to growing our operations in the Asia-Pacific
As Scotiabank celebrates its 175th anniversary, earnings in the
international division have increased to Cdn$1.1 billion, or 30 per cent,
compared to Cdn$489 million, or 23 per cent in 2001.
Rob Pitfield, Executive Vice-President, International Banking,
Scotiabank, said: "International Banking is an increasingly important aspect
of the Bank's operations, as we continue to grow around the world, both
organically and through acquisitions. Our goal is to drive sustained,
profitable growth in each country where we operate, as we adapt to the local
market by drawing on our core strengths and our strategic advantages."
"The partnership between Thanachart Bank and Scotiabank leverages the
strengths of both of our institutions and is strengthened by our shared
commitment to the exciting potential of Thailand," said Banterng Tantivit,
Chairman of Thanachart Bank. "We have a positive outlook for the rest of 2007
and are expecting strong asset growth, improving margins and continued good
credit quality, while expense growth will moderate."
With about Bht257.47 billion (Cdn$9.1 billion) in assets and about 6,000
employees, Thanachart Bank has the fastest growing branch network among the
Top 10 banks in Thailand, with 142 branches and 260 automated teller machines
(ATMs) across the country. It is also the leading automobile lender in
Thailand with a 24 per cent market share for new autos. In addition, the Bank
provides a full range of financial services through subsidiaries in fund
management, brokerage activities, insurance and leasing.
"We view this transaction as a catalyst for future growth in Thailand's
attractive banking sector," said Michele Kwok, Senior Vice-President,
Asia-Pacific and the Middle East, Scotiabank. "Thanachart Bank is a solid
financial institution, with a very strong core business in the automobile
sector and a solid management team. We are confident Scotiabank will add
strategic value that will generate strong financial returns."
With a young and growing population of 65 million people - twice the size
of Canada - Thailand is a sizeable developing market, with a Gross Domestic
Product of US$205 billion that is forecast to grow four-to-five per cent in
Scotiabank has operated in Thailand since 1981, providing corporate,
trade finance and treasury services to local and international companies. The
assets of the Scotiabank branch will be sold to Thanachart Bank.
"As a result of Scotiabank's long presence here, we have developed a deep
understanding of the country," said Ms. Kwok. "Our knowledge and experience
makes this investment a natural progression for Scotiabank's development in
Analysts Conference Call
The conference call will take place on Thursday, March 29, 2007 at 11:30
am EDT and is expected to last approximately 30 minutes.
Interested parties are invited to access the call live, in listen-only
- Via telephone, toll-free, at (800) 732-1073 (please call five-to-15
minutes in advance).
- Via the Internet on the Investor Relations section of
Thanachart is Thailand's eighth-largest bank in terms of assets and
leading automobile lender. As of December 31, 2006, Thanachart Bank's assets
are Bht257.47 billion, 31.7 per cent more than at the end of last year due to
continuous growth of the automobile financing business. The Bank has a total
capital fund of Bht19.56 billion. The total capital adequacy ratio (BIS ratio)
is 11.1 per cent, which is higher than the 8.5 per cent requirement
established by the Bank of Thailand.
Scotiabank operates in 11 countries in the Asia-Pacific and Middle East
region, with about 700 employees and 26 branches and offices. The bank
primarily offers corporate and commercial products and services, including
loans, trade finance, treasury, precious metals, foreign exchange and project
and transportation financing, correspondent banking, loan syndications,
securities investment and retail mortgage financing in selected countries.
Scotiabank is one of North America's premier financial institutions and
Canada's most international bank. With over 57,000 employees, Scotiabank Group
and its affiliates serve approximately 12 million customers in some 50
countries around the world. Scotiabank offers a diverse range of products and
services including personal, commercial, corporate and investment banking.
With $396 billion in assets (as at January 31, 2007), Scotiabank trades on the
Toronto (BNS) and New York Exchanges (BNS). For more information please visit
For further information:
For further information: please contact: Frank Switzer, Scotiabank, in
Toronto, at (416) 866-7238, or firstname.lastname@example.org; Krista Pawley,
Scotiabank, 081-250-0788; or Napaporn Saengkaew, Thanachart Bank, at
02-217-8000, or email@example.com.