The Thai Military Bank (Public) Company Limited, the Thai Danu Bank (Public) Company Limited and the Industrial Finance Corporation of Thailand signed a Memorandum of Understanding on 8 March 2004 after completing a mutual due diligence process in February 2004 and the merger plan was approved by the government authorities including the Ministry of Finance and the Bank of Thailand during March and April 2004.

Concurrently in March, the following committees and working groups with representatives from the 3 financial institutions were formed.

1. Integration Steering Committee (ISC) consisting of directors and CEOs from the 3 financial institutions was to set policies and decide on the key issues affecting the direction of the merger.
2. Integration Management Committee (IMC) consisting of CEOs and senior management from the 3 financial institutions was to formulate, in accordance with the policies and directions set by the ISC, the operating process of the PMO and the Integration Teams.
3. Program Management Office (PMO) consisted of representatives from the 3 institutions to coordinate the operations of the Integration Teams to be consistent with and subject to guidelines set by the ISC and the IMC.
4. Integration Teams were comprised of executives from the 3 institutions organized into various specific groups such as consumer business, SME business, branch service and operation, treasury, risk management, etc. They were the driving force of the units enabled a smooth transitions.

On 26 April 2004 the Thai Military Bank (Public) Company Limited, the Thai Danu Bank (Public) Company Limited and the Industrial Finance Corporation of Thailand signed a Definitive Merger Agreement.

On 29 April 2004 the Thai Military Bank (Public) Company Limited, the Thai Danu Bank (Public) Company Limited and the Industrial Finance Corporation of Thailand convened their annual general meetings. The shareholders’ meeting of the Thai Military Bank (Public) Company Limited unanimously resolved to consolidate and transfer operations between its bank and the Thai Danu Bank (Public) Company Limited and purchase outsanding shares of the Industrial Finance Corporation of Thailand. Moreover, it approved a capital increase. The new shares of the Thai Military Bank (Public) Company Limited shall be allocated and distributed to the shareholders of the Thai Danu Bank (Public) Company Limited and the Industrial Finance Corporation of Thailand as well as the general investors.

The Thai Danu Bank (Public) Company Limited general shareholders’ meeting resolved by a vote of 96.24 % of the shareholders attending to approve the transfer of the bank’s operations and 79% of total shares to approve delisting from the Stock Exchange of Thailand. With regards to the general shareholders’ meeting of the Industrial Finance Corporation of Thailand, 66.17% of the shareholders attended the meeting. Of those, 98% approved the delisting of the Industrial Finance Corporation of Thailand from the Stock Exchange of Thailand.

The Thai Military Bank (Public) Company Limited made a tender offer for the shares of the Thai Danu Bank (Public) Company Limited and of the Industrial Finance Corporation of Thailand from 21 May to 25 June 2004. The result stipulated by the Government would be that the Thai Military Bank (Public) Company Limited was to be the major shareholder of the Thai Danu Bank (Public) Company Limited and the Industrial Finance Corporation of Thailand on approximately 2 July 2004. Newly issued shares of the Thai Military Bank (Public) Company Limited arising from the tender are tradable on the Stock Exchange of Thailand as of 6 July 2004.

Transfers to the Thai Military Bank (Public) Company Limited commenced in September 2004 and the core IT and operations systems integration enabling a single country-wide system for branches of the Thai Military Bank (Public) Company Limited was to be completed in around the fourth quarter of 2004.

The new bank is to become a universal bank on 15 June 2004. The Board of Directors of the Thai Military Bank (Public) Company Limited approved the names of senior executives and the business lines reporting directly to the President and Chief Executive Officer as follows:

Core Business Line	Supporting Business Line
1. Branch 2. Retail Banking 3. Small and Medium Business Promotion 4. Corporate and Investment Banking 5. Treasury and Money Market 6. Asset Development	7. Credit Management 8. Technology 9. Operations and Support 10. Risk Management 11. Organization Strategy 12. Central Services 13. Human Resource 14. Financial 15. Internal Audit

Furthermore, the following units also report directly to the President and CEO:

1. Office of Corporate Governance & Compliance
2. Office of Corporate Counsel
3. Office of Board’s Secretary
4. Office of Public Affairs
5. Office of President and Chief Executive Officer
6. Private Banking

Lower levels of the organization are being restructured to reflect a primary directive to create a flat and empowered organization that will enable swift and more effective management. It is expected that the process will be complete by the fourth quarter of 2004.