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MFC Asset Management PLC (ppt 664kb)


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MFC Asset Management PLC (ppt 664kb)

  1. 1. Corporate Environment and Social Responsibility (CESR) in Thailand MFC Asset Management plc. 20 June 2006
  2. 2. Tsunami Recovery Fund
  3. 3. The Effects of the Tsunami <ul><li>Ranong </li></ul><ul><li>Phang-nga </li></ul><ul><li>Phuket </li></ul><ul><li>Krabi </li></ul><ul><li>Trang </li></ul><ul><li>Satun </li></ul><ul><li>Total of 53,203 people </li></ul><ul><li>or 12,293 households </li></ul>
  4. 4. The Effects of the Tsunami Economic Environmental Social Fishing Tourism/Hospitality Affected 2,293 Household Lost home Lost job Beaches Coral reef
  5. 5. Tsunami Recovery Fund Specifics <ul><li>Unit holders : Stock Exchange of Thailand ,Government Saving Bank and 12 of Commercial Banks </li></ul><ul><li>Fund capital : 3,000 million Baht </li></ul><ul><li>Fund Life : 10 years </li></ul><ul><li>Investmnet Policy : Direct investment in equity or fixed income securities of the companies with emphasis on medium to large businesses </li></ul><ul><li>Management Fee : None </li></ul>
  6. 6. Company Selection Process Candidates Requesting Support Legal Criteria Business Criteria Social Criteria Selected Candidates
  7. 7. Legal Criteria <ul><li>Complies with SEC regulations,the Securities and Exchange Act and Thai Commerce Law </li></ul><ul><li>Situated in the 6 provinces affected by the Tsunam i and engaged in tourism industry </li></ul><ul><li>The Fund will invest no more than 25% of NAV in any one company </li></ul>
  8. 8. Business Criteria <ul><li>Companies will be evaluated in the following categories: </li></ul><ul><ul><li>Product Characteristics </li></ul></ul><ul><ul><li>Market Structure </li></ul></ul><ul><ul><li>Supplier Relationship </li></ul></ul><ul><ul><li>Shareholders/Management Team and track records </li></ul></ul><ul><ul><li>Good Governance </li></ul></ul><ul><ul><li>Financial Strength and Valuation </li></ul></ul>
  9. 9. Social Criteria <ul><li>Once candidates have passed the legal and business criteria, they also will be evaluated on the following: </li></ul><ul><ul><ul><li>Number of employees and wages </li></ul></ul></ul><ul><ul><ul><li>Environmental preservation such as waste water management, beach preservation </li></ul></ul></ul>
  10. 10. The Fund’s Progress Total investment is 2,700 Million Baht 14 resorts in Phang-nga Province 4 resorts and 1 cultural park in Phuket 1 resort in Krabi Province As of May 2006 , we have invested in 20 companies with the majority situated in Khao Lak , Phang-nga and Phuket Provinces
  11. 11. Lists of companies in which the fund has invested Pavillion Resort 19 Phuket Fantasea 20 Treesala Resort 18 Khao Lak Wanaburi Resort 17 Taranta Resort 16 Khao Lak Bundari Resort 15 Khao Lak Laguna Resort 14 Khao Lak Bayfront Resort 13 Bundrika Resort 12 Palm Andaman Resort 11 Southsea Pakarang Resort 10 Best Western Palm Galleria Resort 9 Takolaburi Resort 8 Pakarang Resort 7 Haad Son Resort 6 Baan Khao Lak Resort 5 Khao Lak Palm Beach Resort 4 Sudalha Raman Resort 3 Mookdara Beach Resort 2 Rayawadee Resort 1
  12. 12. Reconstruction Progress <ul><ul><li>7 Resorts and 1 Cultural Park have finished construction/renovation and are currently open for business </li></ul></ul><ul><ul><li>8 Resorts are expected to be completed and open for business for the 2006 high season </li></ul></ul><ul><ul><li>4 Resorts are expected to be completed and open for business for the 2007 high season </li></ul></ul><ul><ul><li>Create long-term employments for more than 3,000 households </li></ul></ul>
  13. 13. MFC Islamic Fund
  14. 14. Investment Policy <ul><li>Invest in listed stocks and also non-listed stocks with growth potential which comply with Islamic principles and are in the MFC Islamic Index </li></ul><ul><li>Religions Advisory Board determines stock selection in compliance with Islamic principles </li></ul><ul><li>Cash deposit with the Islamic Bank of Thailand </li></ul>
  15. 15. Screening Criteria <ul><li>Companies that do not engage in prohibited businesses </li></ul><ul><li>Companies’ financial ratios </li></ul><ul><ul><li>The total debt of the investee company is  33% </li></ul></ul><ul><ul><li>The sum of cash or interest bearing securities of the investee is  33% </li></ul></ul><ul><ul><li>The accounts receivable is  45 % of the total assets of the company </li></ul></ul><ul><li>3. Use SET Index as the benchmark </li></ul>
  16. 16. Dividend Policy <ul><li>Pay dividends at least once a year at a rate of no less than 50% of realized/unrealized profit. </li></ul><ul><li>The first dividend payment was paid on 25 January 2006 for 0.50 baht per unit or 5% (for the investment period during 21 December 2004 – 30 December 2006) </li></ul>
  17. 17. Religious Advisory Board (Shariah Committee) The Religious Advisory Board (Shariah Committee) is comprised of distinguished members of the Thai Muslim community who are knowledgeable about Islamic law and principles. The Shariah Committee advises on the criteria in stock selection and on the donations to charity. 1. Mr.Aroon Boonchom 4. Mr.Thongkam Mahamad 2. Dr.Isma-ae Alee 5. Mr.Banchong Binkason 3. Mr.Sorakit Hasan 6. Mr.Noppadol Tehman
  18. 18. Fund Performance As at May 26, 2006 16.28% 20.61% 8.09% -1.18% MFC Islamic Index 6.85% 8.14% 7.11% -3.28% SET Index 11.93% 17.66% 7.11% 0.70% MIF Since Inception 1 Year 6 Months 3 Months Fund Performance (After adjusting for dividends)
  19. 19. Fund Performance As at May 26, 2006
  20. 20. Sector Allocation As at May 26, 2006 Energy 23% Electronics 4% Communication 12% Property Development 16% Petrochemical 9% Construction Materials 13% Health Care 15% Packaging 3% Transportation 3% Automotive 2%
  21. 21. Top 10 Holding As at May 26, 2006 PSL 3% PTL 3% HANA 5% DCC 5% SCCC 8% PTTCH 8% ADVANC 12% BH 15% PTTEP 25% AMATA 16%
  22. 22. Donation of part of Management Fee to Charity (sagad) <ul><li>MFC has a policy to donate part of the management fee equal to 0.25% of net asset value to various charities. </li></ul><ul><li>In 2005, MFC donated a total of 85,000 Baht as follows: </li></ul><ul><li>1. April : Donated 50,000 Baht to “Charity for Orphans of the Tsunami” </li></ul><ul><li>2. July : Donated 35,000 Baht to “Khun Poomi Foundation” to help orphans and schools affected by the natural disaster in the South </li></ul><ul><li>In 2006, MFC has plans to donate a total of 620,000 Baht as follows: </li></ul><ul><li>1. To donate 570,000 Baht in scholarships to students in the three southern provinces of Yala, Naratiwas and </li></ul><ul><li>Pattani .A total of 90 scholarships will be awarded. </li></ul><ul><li>2. To donate 50,000 Baht to renovate mosques that were damaged by terrorist acts in the South </li></ul>
  23. 23. Fund Specifics <ul><li>Size of Fund 343.42 Million Baht or 10.2025 Baht per unit (as at 16 th June 2006) </li></ul><ul><li>Open for subscription every business day and redemption every Monday </li></ul><ul><li>The Fund has received support from the following institutions: </li></ul><ul><ul><li>Islamic Bank of Thailand </li></ul></ul><ul><ul><li>Government Savings Bank </li></ul></ul><ul><ul><li>The Stock Exchange of Thailand </li></ul></ul><ul><ul><li>Social Security Fund </li></ul></ul>
  24. 24. MFC Environmental and Socially Responsible Investment Fund
  25. 25. Type of Fund <ul><li>Open-end Fund : the Unit holders can invest once a month </li></ul><ul><li>Investment Policy : Flexible Fund can invest in equity, fixed-income and other instruments </li></ul><ul><li>Invest in the securities that are considered as “Socially Responsible” </li></ul><ul><li>Benchmark: SET 50 </li></ul>
  26. 26. Screening Policy <ul><ul><li>Topic Investment Policy </li></ul></ul><ul><li>Alcohol :No Investment </li></ul><ul><li>Tobacco :No Investment </li></ul><ul><li>Gambling :No Investment </li></ul><ul><li>Defense/Weapon :No Investment </li></ul><ul><li>Animal Testing :No Investment </li></ul><ul><li>Pornographic Related :No Investment </li></ul><ul><ul><li>Topic Investment Policy </li></ul></ul><ul><li>Environment :Invest Positively </li></ul><ul><li>Beneficial products and services :Invest Positively </li></ul><ul><li>Labor Relations :Invest Positively </li></ul><ul><li>Human Rights :Invest Positively </li></ul><ul><li>Employment/Equality :Invest Positively </li></ul><ul><li>Community Investment :Invest Positively </li></ul>
  27. 27. Fund Management Methodology <ul><li>“ Applies financial criteria then conducts social screening” </li></ul><ul><li>Social Screening Method would be </li></ul><ul><ul><li>Using 3 rd party standard: </li></ul></ul><ul><ul><ul><li>ISO 14000 </li></ul></ul></ul><ul><ul><ul><li>Corporate Governance Standard according to SET </li></ul></ul></ul><ul><ul><li>If no 3 rd party standard, we use: </li></ul></ul><ul><ul><ul><li>Internal Screening Committee </li></ul></ul></ul>
  28. 28. Why ISO 14000 <ul><li>ISO 14000 is a series of environmental management standards </li></ul><ul><li>The ISO 14000 standards provide a guideline or framework for organizations that need to systematize and improve their environmental management efforts. </li></ul>
  29. 29. Study in Thailand <ul><li>Preliminary study on ISO 14000 companies listed in SET </li></ul>
  30. 30. Study in Thailand <ul><li>Set Index </li></ul>ISO14000 Companies return