Media Releases
Published Date: 04 March 1998

Tat Lee Bank

4 Mar 1998 ... The Tat Lee Bank Group (TLB Group) has reported an after-tax loss of $38.7m for 1997. The MAS is satisfied that the TLB Group is financially sound. The Group is solvent and fully capable of meeting all the obligations of TLB and its finance company subsidiary. Depositors need not worry about the safety of their deposits.

The TLB Group's loss of $38.7 million in 1997 arises from the substantial provisions of S$150 million that it is setting aside for its regional loans. The loss equals 2.4% of its shareholders' funds. The TLB Group has shareholders' funds of $1.6 billion, equal to 19% of its risk-weighted assets as at 31 Dec 97. This is well in excess of the 12% capital requirement for Singapore banks, which is itself higher than international norms1.

The MAS is confident that the impending merger of the TLB Group and Keppel Bank (KB) Group will create a more resilient and competitive bank. The KB Group is a subsidiary of Keppel Corporation, the largest shareholder of which is the Government-owned Temasek Holdings (Private) Limited. The combined bank will be able to consolidate and streamline the operations of the two banks. It will be well positioned to build a diversified portfolio and achieve healthy growth.

1These figures take account of the revaluation of the TLB Group's assets which it has undertaken in connection with its proposed merger with Keppel Bank. Before revaluation, TLB Group's shareholders' funds were $1.4 billion; and its capital adequacy ratio was 17%.