35414 - TMB RSF

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Summary of Investment Information

Project Number

35414

Company Name

TMB THANACHART BANK PUBLIC COMPANY LIMITED

Date SPI Disclosed

Jul 23, 2014

Country

Thailand

Region

East Asia and the Pacific

Projected Board Date

Aug 29, 2014

Environmental Category

FI-2 - Limited

Status

Completed

Last Updated Date

Sep 3, 2021

Department

Regional Industry - FIG Asia & Pac

Industry

Financial Markets

Previous Events

Approved : Sep 3, 2014
Signed : Sep 23, 2014

Sector

Commercial Banking - General

Project Description

The Project (“TMB RSF”) consists on an unfunded Risk Sharing Facility (“RSF”) of US$70 million to be provided to TMB Bank Public Ltd. (“TMB”) with a 7-year maturity in order to support the Bank to further extend loans to the SME sector in Thailand.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee	70.44
Loan
Equity

Development Impact

- Providing Risk Mitigation: IFC will provide TMB with the appropriate risk protection it requires to further grow its SME portfolio, a segment in which there is still ample space in this market.

- Fostering a Strategic Relationship: IFC would add value to TMB by structuring a tailored made risk management product that addresses the Bank''s needs. Accordingly, IFC would support the growth of an existing client, fostering the relationship with a strategic partner in the Country.

E&S Category Rationale / Risks and Mitigation

The Project involves an unfunded risk-sharing facility (RSF) to support TMB Bank to further extend loans to small and medium enterprises (SMEs) and has been categorized as FI-2 in accordance with IFC’s Environmental and Social Review Procedure. TMB’s current SME lending represents over 36 percent of its total loan portfolio. Such SMEs typically have revenue less than US$15.5 million and are mostly in the manufacturing and commerce sectors. Activities supported by the RSF entail limited potential E&S risk and impacts that are generally few in number, site-specific, largely reversible and can be readily addressed through mitigation measures. TMB will be required to manage the E&S risks of the RSF supported activities consistent with the requirements of the IFC Exclusion List, applicable national E&S laws and regulations, and IFC Performance Standards where applicable.

The main E&S risks and impacts of the Project derive from the E&S risks of the RSF supported activities and the system and capacity of the bank to manage such risks. At present TMB has developed an Environmental and Social Management System (ESMS) outlining the procedures and responsibilities for undertaking E&S risk management with respect to its lending activities. However, some improvements are still necessary related to the ESMS implementation, including developing supporting tools and appointing an ESMS officer to oversee the ESMS implementation. These performance gaps in the bank’s ESMS implementation will be closed by December 31, 2014. The bank’s HR practice is found to be broadly in compliance with the requirements of IFC Performance Standard 2 Labor and Working Conditions.

Contacts

For Inquiries About the Project, Contact

Mr. Samuel Cheung
Head of SME Product & Portfolio Management
TMB Bank Public Company Limited
3000 Phahonyothin Road, Chompon, Chatuchak
Bangkok 10900
THAILAND
Tel: +66 0-2299-1178
Fax: +66 2242 3138/9
http://www.tmbbank.com

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Local Access of Project Documentation

N/A

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Task Title & Description	Anticipated Completion Date
Nominate officers to oversee the ESMS implementation	12/31/2014
Develop necessary E&S tools to support the ESMS implementation	12/31/2014
Train all relevant staff on the ESMS implementation	12/31/2014
Implement the ESMS	12/31/2014

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