Page 77 - BAM ONE REPORT 2564 (ENGLISH VERSION)

Form 56-1 One Report 2021
Bangkok Commercial Asset Management Public Co., Ltd. 75

Company to market and sell its properties and may result in a higher cost of holding those assets. A decline in value
of collateral underlying NPLs or NPAs may also cause the Company to record a higher amount of allowance for doubtful
accounts of loans purchase and allowance for impairment of properties for sale.

Thai real estate market is influenced by a number of factors that are beyond the Company’s control such as
macro-economic condition, interest rate, inflation rate, household debts, city expansion rate, net personal income,
demand and supply situation, and so on. Moreover, the government’s adoption of any new laws, rules, regulations or
policies that may directly or indirectly affect growth in the real estate market will likely have a significant adverse impact
not only on the Company’s ability to generate revenue and cash flow from collateral underlying NPLs and NPAs but
also on its revenue, profitability, financial position, and performance.

Risk of a due diligence review on the Company’s NPLs and NPAs being conducted based on information
that is incomplete or not totally correct, thus likely leading to an error in determination of purchase prices of
NPLs and NPAs
Since most of the NPLs and NPAs acquired by the Company do not have definite market prices, the Company
has to determine purchase prices of those NPLs and NPAs based on several factors. For NPLs, the factors include
competition, forecasting of debt collection from NPLs, collateral value, and debtors’ history. In the case of NPAs, the
factors consist of property appraisal carried out based on the data on those properties obtained by the Company and
the due diligence review conducted by the Company itself, estimated expenses relating to management and sale of
those assets, and market and competition situation in a given period. Therefore, failure to conduct the due diligence
review and/or select NPLs and NPAs effectively may result in the Company not receiving a good return on investment
or suffering a loss.

Before purchasing any NPLs and NPAs, the Company will conduct a due diligence review as deemed appropriate
based on facts and environmental factors relevant to the purchase of any such NPLs and NPAs. Through all past years
and in the future, the Company conducts the due diligence review using information obtained from the financial
institution that sells NPLs and NPAs to the Company. It is likely that such information may be incomplete or not totally
correct and the relevant facts that are essential or useful for evaluating the purchase may not be completely disclosed.
Although the Company normally assigns its staff to make an onsite survey of the assets, the Company cannot
access the collateralized assets when appraising such NPLs. Therefore, the Company may be unable to identify the
encumbrances on or actual condition of those assets and may accordingly appraise the NPLs and NPAs at a price higher
than a commrcially reasonable price due to a lack of complete or accurate information. These factors could affect the
Company’s profitability, financial position, and performance. For instance, the Company may not be aware of
the encumbrances on the collateral or cannot ensure that it will obtain title to the collateralized assets without any
shortcomings. Previously, the Company used to receive incomplete and inaccurate information on certain properties,
which caused it to make a mistake in determining the purchase prices of those properties. Despite the fact that financial
institutions generally give the Company a right to return the purchased NPLs and NPAs within a period of time specified
in each agreement in the event that the information on such NPLs and NPAs provided by the financial institutions which
are the sellers is incomplete or incorrect, the Company may be unable to recognize the deficiency or error of such
information within the period specified, thus likely affecting the return obtainable by the Company from NPLs and NPAs.