TMBThanachart announced a 3-year share repurchase program worth up to 21,000 million baht. The first round will be a share repurchase of up to 7,000 million baht, from 3 February 2025 to 1 August 2025. This repurchase program is part of the Bank's capital management plan to enhance shareholders' value by optimizing balance sheet size and structure.
TMBThanachart Bank Public Company Limited, or TMBThanachart (ttb), notified the Stock Exchange of Thailand that its Board of Director's Meeting has passed a resolution in relation to the approval of the share repurchase project for financial management purposes. The share repurchase is a 3-year program with an amount up to 21,000 million baht, starting from 2025 to 2027. For the first round, the repurchase amount is up to 7,000 million baht, with the number of shares to be repurchased not exceeding 3,500,000,000 shares or not exceeding 3.6% of the Bank's total outstanding shares. The share repurchase shall be executed by means of automated order matching on the Stock Exchange of Thailand's trading system between 3 February 2025 to 1 August 2025.
Mr. Piti Tantakasem, CEO of TMBThanachart, mentioned, "The share repurchase program is as part of the Bank's capital management plan, with an objective to enhance shareholders' value through the optimization of balance sheet size and structure.
The rationale behind this project is the Bank's robust capital level. Since the merger, the Bank's capital base continues to increase, driven by a prudent business direction and an efficient operation. Currently, the Bank capital adequacy ratio is 19.3%, which is at the same level as D-SIBs peers and well above the Bank of Thailand's minimum requirement of 12.0%. The Bank, therefore, sees the opportunity to optimize the excess capital without affecting the Bank's financial stability and future business plan.
As a benefit to shareholders after the repurchase, the return on equity (ROE) and earnings per share (EPS) is expected to improve from the current level of ROE at 9.0% and EPS at 0.22 baht at the end of 2024. This improvement is a direct result of the reduction in equity value and the number of shares traded in the stock market. Meanwhile, the Capital Adequacy Ratio is expected to stay above 19%, remain robust and sufficient for the Bank's business expansion plan.
For the remaining repurchase amount of 14,000 million baht, the repurchase criteria and execution period are subject to future determination considering the market condition and share value to ensure that the execution of the following two rounds would be in the best interest of shareholders."
Mr. Piti concluded, "Aside from the share repurchase project, the Bank has executed a capital management plan in various ways. Our initiatives include the early redemption of Additional Tier 1 debt instruments and the reduction in re-issued size of subordinated debt-Tier 2. Notably, the Bank has increased the dividend payout ratio to 60% from a pre-merger level of 30%-35% and explored inorganic growth opportunities. Recently, the Bank signed a Non-Binding MOU, intending to conduct due diligence to see the potential acquisition of shares in Thanachart Securities and TLeasing.
Such initiatives reflected our commitment to enhancing shareholders' value in both short- and long-term. We will continue to focus on prudent business direction to deliver quality growth and to sustainably enhance stakeholders' returns."