Somchainuk to step down at TMB

"My resignation is normal practice since the bank completed its capital increase," Somchainuk said after a meeting of TMB's board.

However, TMB chief executive and president Subhak Siwaraksa said he himself was still in his post, even though the board meeting yesterday was to consider changes to the management team. He was absent from the meeting during this topic and so did not have any information about it, Subhak said.

TMB, the country's fifth-largest bank, in December completed its Bt38-billion capital-increase plan through 25 billion shares, of which 10.97 billion were allotted to ING Bank, giving the Dutch institution the major stake

in TMB at 26.1 per cent.

The shareholding of the Finance Ministry, the previous major shareholder, was diluted from 31 per cent to 25.2 per cent.

The pending changes to the bank's management follow the restructuring of its shareholding and the massive net loss of Bt46 billion in 2007. Former deputy finance minister Sommai Phasee had demanded that TMB's management led by Subhak must resign to take responsibility for the bank's loss. There have also been rumours that the two main shareholders want to replace Subhak as CEO.

Two possible candidates to replace Subhak are Government Housing Bank president Khan Prachaupmoh, who is well supported by the Finance Ministry, and Boontuck Wangcharoen, a former executive vice president of Kasikornbank who has the support of ING.

TMB is setting up a committee to select a new chairman and CEO. Sathit Limpongpan, a newly appointed director, will serve as acting chairman until the new chairman is appointed.

A TMB source said although the bank had started the process to find a new CEO and chairman, Subhak and Somchainuk could still be nominated as candidates for the two posts.

An analyst at Asia Plus Securities said the change in the bank's CEO had been expected by investors and the market had already absorbed this news. However, it is too soon to say whether the change would improve the bank's operations. It depends on the new president as well as the bank's adjustment of internal operations, he said.

An analyst at Tisco Securities said a new CEO did not guarantee that the bank's operations would improve. Even though the two prospective candidates have good backgrounds, it would depend on their acceptance by the bank staff, the analyst said.

Somruedi Banchongduang

The Nation