In 2006 there were some small but significant changes to Bangkok Bank’s senior management team. Mr. Singh Tangtatswas, Chairman of the Risk Management Committee, was appointed to the role of Managing Director to strengthen our management team. Later, Mr. Kosit Panpiemras, our distinguished Chairman of the Board of Executive Directors, was graciously invited to join the Interim Government in the role of Deputy Prime Minister and Minister of Industry. Although we regret honor and trust bestowed on him to serve the country. Meanwhile, we were pleased when our highly esteemed Board Director and former senior bank executive, Mr. Piti Sithi-Amnuai, agreed to fill the breach as Bangkok Bank’s Chairman of the Board of Executive Directors.

Bangkok Bank in 2006 achieved a robust performance, particularly in our International Banking operations. Fee growth and lending in these business units easily outstripped the overall GDP growth rate of 5 percent amidst a number of challenges in the external environment such as an unsettled political situation and serious flooding in the northern and central parts of the country. However on the positive side, there was strong demand for exports from Thailand’s major regional trading partners and rising prices for agricultural commodities such as tapioca, rice and rubber which fed through into incomes in the rural sector.

Bangkok Bank’s key competitive strength continues to be our customer base, the largest in Thailand, and our enduring customer relationships. Throughout our 62 years of history, we have grown with our customers and now have an unrivaled network of business partners. Our fundamental strength also lied in the extensive and well established network of domestic branches as well as our strategically located overseas branches. The oversea network spans the rapidly growing economics of greater China and Southeast Asia as well as major cities such as London, Tokyo, and New York. Bangkok Bank has a longstanding presence in China with branches in Beijing, Shanghai, Xiamen, and Shantou, all of which have posted strong growth. We plan to strengthen our presence in China even further with the opening of a new branch in Shenzhen 2007.

In addition to widening our geographic base, we are also employing customer segmentation to further deepen our customer relationships and improve our customer focus. In terms of operations, the Bank is building on the synergies between operational units such as Corporate Banking, Commercial Banking, Business Banking, Investment Banking, and Customer Banking; and subsidiaries such as Bualuang Securities and BBL Asset Management. This enables us to expand the range of investment services we provide, increase choices and add value to customers, while strengthening our base of fee income.

In parallel with this, we have continued to improve our asset quality, with non-performing loans reducing over the past five years from 30.8 percent of total loans at the end of 2001 to 9.2 percent of total loans at the end of 2006. Notwithstanding this, the Bank has continued to make prudent provisions against possible risks with the allowance for doubtful accounts at the year-end standing at Baht 71.5 billion.

At the end of 2006, our capital adequacy ratio remained healthy at 14.5 percent, and in this regard the bank is well placed for the introduction of Basel II in 2008. In preparation for this, we are establishing appropriate structures and systems, including risk-based processes, models and policies. In addition to strengthening our risk management systems, we expect this systematic approach will enable us to deepen our customer knowledge and in the longer term to minimize our cost of capital.

In 2006 Bangkok Bank was rates by The Asian Banker magazine as the top commercial bank in Thailand in term of asset size and strength as well as the fifth largest bank in Southeast Asia.

Looking forward, we anticipate that economic growth in Thailand in 2007 will continue to be around 4-5 percent. Both public and private investment in Thailand is expected to rise as the Thai government has confirmed plans to invest in new infrastructure development while the private sector will find it necessary to invent in the expansion of their industrial capacity. This will lead to increased demand for finance from the corporate sector. In addition to supporting the growth of large corporations, we will also be strengthening our presence in the SME and consumer markets and we will be rolling out a number of new initiatives to tap into these high-growth customer segments.

On behalf of the Bank’s board of directors, I would like to take this opportunity to thank all our shareholders, customers, suppliers, and business partners for their ongoing support. I would also to thank the Bank’s management team and staff for their dedicated and continued efforts. Bangkok Bank is proud to play valuable role in Thai society and we will continue to the economic development of the country, in keeping with our proud history.