Page 321 - BAM ONE REPORT 2565 (ENGLISH VERSION)

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Form 56-1 One Report 2022
3) Risk of changes in market prices of collateral assets

This is the risk of changes in the market prices of collateral assets of debtors, in line with
market conditions, will lead to fluctuations in income both increase and decrease.
The Company reviews the appraisal value in accordance with BOT’s guidelines, with

the valuations of collateral are reviewed every three years or whenever there are
significant changes in relevant circumstances. Allowance for expected credit loss for

loans purchased of receivables is adequately set aside to accommodate any possible
loss from depreciation/impairment of collateral of the debtors.

c) Liquidity risk

This is the risk that the Company will be unable to pay debts and meet obligations when due,
because the Company is unable to timely convert assets into cash when settlement is due,

obtain sufficient funds to meet funding needs, or is able to obtain funds but at a cost that is
beyond an acceptable level. These risks may affect the Company’s income and financial

position.

Tools for liquidity risk management

The Company has established a policy for management of liquidity and maintenance of
liquidity risk ceilings at acceptable levels, which stipulates the tools to be used for monitoring

and controlling liquidity risk by the relevant management personnel and committees, namely
the Assets and Liabilities Management Committee and Risk Management Committee. The
tools used for liquidity risk management include estimations of cash inflows and outflows to

assess the liquidity gap for various periods of time, analysis of key financial ratios and stress
tests of financial liquidity.

Furthermore, the Company has laid down guidelines for the preparation of a contingency

funding plan for both normal and emergency situations to ensure timely access to funding
sources and adequate cash flows at an appropriate funding cost in the event of a liquidity
crisis.

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