BAM president Bunyong Visatemongkolchai told The Nation in an exclusive interview on Wednesday that the management of the state-owned asset management company had proposed the listing plan to its board of directors in October and November and, on both occasions, it was rejected with a request that the plan be studied further. BAM's board includes representatives of the Finance Ministry and the Bank of Thailand.

"They [the board members] are concerned whether our business characteristics are suitable for the stock market. So, we're not sure whether we will be able to enter the stock market as earlier planned," he said.

The company's management is currently working on the issues causing most concern in the board room. Earlier, it had announced plans to list on the SET in order to raise funds for business expansion.

If listed, BAM will be the first ever asset management company to be traded in the equity market. However, being the first is not the obstacle. The company has received opinions from two financial advisers studying its potential to list on the stock market, and one of them warned that although no relevant laws prohibit BAM from listing on the SET, the company needs to prove to investors that its business will have continuity. Investors will want to know that in the long-term, there will be business left for BAM to conduct.

In response, Bunyong said there are non-performing loans (NPLs) worth as much as Bt470 billion and non-performing assets (NPAs) valued at Bt170 billion that commercial banks will eventually unload from their balance sheets to asset management firms. This offers a lot of opportunity for BAM's business to grow further.

"Our business potential is still high," Bunyong said. "Suppose we received all these NPLs, the business would take several years to complete."

He said BAM expects to buy bad debts valued at Bt50 billion next year. This year, it has bought around Bt110-billion worth of NPLs, as well as NPAs valued at Bt30 billion, from financial institutions.

The financial adviser considering BAM's listing plan also pointed out that BAM's profit margin is not sufficiently attractive and asked how profits might be maximised.

Bunyong said BAM's earnings per share, based on its book value of Bt40 per share, are Bt2 apiece or around 4 per cent per year. Although the earnings per share are still low, there is potential for growth in the future.

Jiwamol Kanoksilp

The Nation