Page 136 - รายงานประจำปี 2566

Tokio Marine Safety Insurance (Thailand) Public Company Limited
Notes to the Financial Statements

Tokio Marine Safety Insurance (Thailand) Public Company Limited
For the year ended 31 December 2023
Notes to the Financial Statements
For the year ended 31 December 2023

5.1 Financial risk management policies
The Company is exposed to normal business risks from changes in market interest rates,
exchange rates, market risk in the future and from non-performance of contractual obligations
by counterparties. The Company does not hold or issue derivative financial instruments for
speculative or trading purposes.

Risk management is integral to the whole business of the Company. The Company has a
system of controls in place to create an acceptable balance between the cost of risk occurring
and the cost of managing the risks. The management continually monitors the Company’s risk
management process to ensure that an appropriate balance between risk and control is achieved.
Capital management

The Company maintains its capital fund in accordance with the requirements of the Office of
Insurance Commission. The Company’s objectives in managing capital are to ensure that it has
appropriate financial resources to continue its business as a going concern in order to protect
policyholders and to provide returns for shareholders and benefits for other stakeholders, and to
maintain an optimal capital structure to reduce the cost of capital. The board of directors monitors
the return on capital, which the Company defines as results from operating activities divided by
total equity, and also monitors the level of dividends to ordinary shareholders.
5.1.1 Market risk
Market risk refers to the value or price of assets, such as interest rate, exchange rate,
asset in money or capital market, including price volatility of money and capital market
securities which affects the value of price of equity and then takes effect to the Company’s
stability and may negatively result the Company’s income.
a) Interest rate risk
Interest rate risk is the risk that future movements in market interest rates will affect the
results of the Company’s operations and its cash flows and it will affect the interest
income from investments. The investments include both short-term and long-term investments
that have fixed and floating interest rates. The Company manages the investment risk by
considering the risk of investments together with the appropriate return on such investments.
Significant financial assets classified by type of interest rate are summarised in the table
below, with those financial assets that carry fixed interest rates further classified based on the
maturity date or the repricing date (if this occurs before the maturity date).
For the year ended 31 December 2023
Fixed interest rates
Floating Non-
Within Over Interest Interest
1 year 1 - 5 years 5 years rates bearing Total Interest
Thousand Thousand Thousand Thousand Thousand Thousand rate
Baht Baht Baht Baht Baht Baht (%p.a.)
Financial assets
Cash and cash
equivalents - - - 471,371 71,549 542,920 0.00 - 0.50
Financial assets -
Debt instruments
Government and
state enterprise
promissory notes 4,533,787 3,488,856 1,216,129 - - 9,238,772 0.61 - 4.26
Private enterprise
debt securities 2,149,959 5,224,927 1,977,144 - - 9,352,030 0.96 - 6.80
Unit trust - - - - 1,112,995 1,112,995 -
Deposit at financial
institutions with
original maturing
more than 3 months 1,073,000 - - - - 1,073,000 0.50 - 2.55
Loans 1,058 17,784 24,645 - - 43,487 4.00 - 7.00
Total 7,757,804 8,731,567 3,217,918 471,371 1,184,544 21,363,204

136 | รายงานประจำาปี 2566 | ANNUAL REPORT 2023 19