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Published on April 22, 2008

Thanong Khanthong

The Nation

"Over the next four to five years Thailand will still be doing quite well with its macroeconomic conditions," he said.

This confidence is reflected in TPG Capital's move earlier this year to raise its stake in BankThai. TPG Capital took a 33 per cent stake in BankThai in April 2007 before increasing this stake further to 42 per cent in January 2008.

TPG Capital also appointed its representative Robert Cohen to become a senior advisor to the board of BankThai. Cohen served as president and CEO of Korea First Bank when TPG first made its foray into the Asian market by buying into the Korean bank, which has been successfully turned around. YY Chin, a former head of group consumer financial services at OCBC Bank in Singa-pore, was also appointed to BankThai to improve its retail franchise. Ranvir Dewan, another BankThai board member, is also working on the risk management side, financial controls and information systems.

TPG is a private investment partnership that was founded in 1992 and currently has more than US$35 billion (Bt1.1 trillion) of assets under management. It operates out of 16 offices world-wide, six of which are located in Asia. TPG has experience with public and private investments executed through leveraged buyouts, re-capitalisations, spin-outs, joint ventures and re-structurings.

In 1994, Carroll played a key role in helping TPG Capital, formerly known as Newbridge Capital, to establish its Asian presence. TPG, now one of the top companies on the Fortune 500 list, seeks to invest in world-class franchises across a range of industries including branded consumer franchises, retail, airlines, media and communications, industrials, technology, financial services and health care.

Carroll now runs TPG Capital's Asia operations out of Hong Kong. He has assembled about 40 professionals in different fields to work in its six offices in Hong Kong, Melbourne, Mumbai, Singapore, Tokyo and Beijing. He is a director for Shenzhen Development Bank, Lenovo Group, BankThai and NIS Group.

TPG Capital's strategy is to invest in companies with growth potential with a long term view of at least five years before divesting. For instance, with its involvement with BankThai, its key responsibility is to bring in expatriate experts with divergent experience to help the bank improve its overall performance.

"Our strategy is to introduce best practices to the bank," said Carroll.

Second, the group's strategy is to improve the bank's system through risk management, credit risks, consumer risks,

IT, among other improvements.

Finally, it also aims to improve the regulatory relationship with banking authorities. Carroll said TPG Capital has good relations with regulators in Korea, China, Indonesia, Taiwan, where regulations are fairly tight.

However, BankThai still needs to overcome its past problems as it came into being through mergers with financial institutions in the aftermath of the 1997 financial crisis. It has also moved to deal with its holdings of mortgage-backed securities, issued by the US institutions, which have turned sour.

Carroll said that TPG Capital's investment in BankThai remains in the initial stage of development. Still, the bank needs to work harder to move forward because it is not proceeding at the anticipated speed.

Carroll said TPG Capital is willing to work with the bank's management and banking authorities to improve BankThai's operation, particularly in corporate, unsecured business, SME and retail sectors, as the Financial Institution Development Bank is also a key shareholder of the bank.