Page 38 - BAM ONE REPORT 2564 (ENGLISH VERSION)

36 Part 1
Business Operation and Performance

The Company will consider purchasing the NPLs from the financial institutions whether by direct negotiation
with the financial institutions or through joining bidding for NPLs distributed by the financial institutions, after receiving
information or from registration to join the bidding and receiving the bidding envelope from the financial institutions.
Then, the Company will evaluate the NPLs by considering if such NPLs contain collaterals or not. The Company focuses
on purchasing secured NPLs with guarantee as real estate. However, in case of purchase of NPLs from the financial
institutions, the Company will purchase the NPLs after negotiation with the seller’s financial institution.

Furthermore, the Company maintains good relationship with the domestic financial institutions as a channel to
keep updated about news and information from the financial institutions closely.

(2) Inspection, property appraisal and payment
When a financial institution distributes NPLs in form of bidding or direct sale negotiation with the Company, the
Company will sign in a non-disclosure agreement with the related financial institution before receiving the document
with information of the offered NPLs. The Company will use such information to check the status and appraise the
collaterals of the NPLs before purchase.

Due diligence process of the Company includes the related loan document examination and additional inquiry
from the vendors as well as surveying and verifying the price of collaterals of the NPLs in support of the purchase.
The Company utilizes the network of branch offices nationwide, that normally, the officers at a branch office near the
collateral of such NPLs will gather information to survey the collateral of the NPLs before presenting the survey result
and price to the working group for non-performing loans (NPLs) and non-performing asset (NPAs) purchase from the
financial institutions. After the Committee for non-performing loans (NPLs) and non-performing assets (NPAs) purchase
from the financial institutions considers information and purchase pricing, it will present to the Executive Committee
and Board of Directors to approve the NPLs purchase price.

Generally, the Company defines the bidding price or proposed price of NPLs from various factors such as
expected cash flow that the Company will receive from the NPLs in the future, collateral value, and record of debtors
etc. Furthermore, for suitable pricing, the Company considers the status of legal execution process as well as legal
validity, business type, occupation of the debtors, and existence of the collaterals for such debts. When the investment
team quotes the purchase price of NPLs and NPAs from the financial institutions, the Committee will present the price
to the Executive Committee and the Board of Directors for further approval. Nevertheless, joining the bidding or
purchasing NPLs shall be approved by the Executive Committee and Board of Directors by recognizing suitability of
the return rate of investment and risk.

The Company pays for NPLs acquired from financial institutions in cash, using the cash generated from its
operation, and from issuing the promissory notes, taking out a loan, and issuing debentures. In order to choose its
source of funding, the Company will consider the cost of capital and its general liquidity. If the Company considers the
choice of issuing the promissory notes, the term of the promissory notes will be subjected to the commercial agreement.

Normally, after signing an agreement for NPLs purchase, the Company will have a period to verify claiming
rights and collaterals and has the right to return the NPLs to the seller in case of some incomplete conditions such
as not receiving the certificate of ownership required for initiating the legal process against debtors or not delivering
the collaterals completely. These conditions may be different for each agreement in the past. The Company used
to make an agreement with the NPLs vendors about sharing of profit from NPLs management. However, the Company
has no obligation in such manner at present.