11. RELATED PARTIES TRANSACTIONS

11.1 Characteristics of Related Parties Transactions

  The Company has transactions with its subsidiaries, affiliates and
  related companies as detailed in note to financial statement no. 7.

  For the period ending 31 December 2005 and 31 December 2006, the
  Company and subsidiaries entered into a number of transactions with
  related parties that may have conflict of interest with the Company
  and its subsidiaries. These connected transactions include normal
  course of business transactions and other transactions, and can be
  summarized as follows:

+--------+----------+----------+------+-----+-------------+---------+
| R      | Rela     | Des      | Am   |     | Pricing     | Reason  |
| elated | tionship | cription | ount |     | Policy      | for the |
| C      |          |          | (    |     |             | tran    |
| ompany |          |          | Baht |     |             | saction |
|        |          |          | Mill |     |             |         |
|        |          |          | ion) |     |             |         |
+========+==========+==========+======+=====+=============+=========+
|        |          |          | For  | For |             |         |
|        |          |          | the  | the |             |         |
|        |          |          | year | y   |             |         |
|        |          |          | e    | ear |             |         |
|        |          |          | nded |     |             |         |
|        |          |          |      | en  |             |         |
|        |          |          | 31   | ded |             |         |
|        |          |          | Dec  |     |             |         |
|        |          |          | 2005 | 31  |             |         |
|        |          |          |      | Dec |             |         |
|        |          |          |      | 2   |             |         |
|        |          |          |      | 006 |             |         |
+--------+----------+----------+------+-----+-------------+---------+
| B      | Common   | Revenues | 22.1 | 2   | It is the   | The     |
| angkok | d        |          |      | 1.3 | Company’s   | Audit   |
| Ins    | irector, | -        |      |     | normal      | Co      |
| urance | and BKI  | Revenues |      |     | course of   | mmittee |
| Pcl.   | is the   | from     |      |     | business,   | has the |
| (BKI)  | major    | hospital |      |     | charging at | opinion |
|        | sha      | services |      |     | normal      | that    |
|        | reholder | received |      |     | price and   | the     |
|        | of the   | from BKI |      |     | benefits as | tran    |
|        | Company, |          |      |     | customers   | saction |
|        | with     |          |      |     | in general. | is      |
|        | 13.19%   |          |      |     |             | reas    |
|        | shar     |          |      |     |             | onable. |
|        | eholding |          |      |     |             |         |
|        | as at 19 |          |      |     |             |         |
|        | Feb 2007 |          |      |     |             |         |
+--------+----------+----------+------+-----+-------------+---------+
|        |          | Expenses | 15.7 | 1   | BKI is the  | The     |
|        |          |          |      | 8.5 | insurance   | Audit   |
|        |          | -        |      |     | provider    | Co      |
|        |          | I        |      |     | which the   | mmittee |
|        |          | nsurance |      |     | Company and | has the |
|        |          | fees     |      |     | s           | opinion |
|        |          | which    |      |     | ubsidiaries | that    |
|        |          | the      |      |     | have always | the     |
|        |          | Company  |      |     | used. In    | tran    |
|        |          | and      |      |     | addition,   | saction |
|        |          | subs     |      |     | the         | is      |
|        |          | idiaries |      |     | insurance   | reas    |
|        |          | paid to  |      |     | premium     | onable. |
|        |          | BKI      |      |     | that the    |         |
|        |          |          |      |     | Company and |         |
|        |          |          |      |     | s           |         |
|        |          |          |      |     | ubsidiaries |         |
|        |          |          |      |     | paid to BKI |         |
|        |          |          |      |     | was at the  |         |
|        |          |          |      |     | rate which  |         |
|        |          |          |      |     | BKI offers  |         |
|        |          |          |      |     | to its      |         |
|        |          |          |      |     | customers   |         |
|        |          |          |      |     | in general. |         |
+--------+----------+----------+------+-----+-------------+---------+
| B      | Common   | Revenues | 22.8 | 2   | It is the   | The     |
| angkok | director |          |      | 0.9 | Company’s   | Audit   |
| Bank   |          | -        |      |     | normal      | Co      |
| Pcl.   |          | Revenues |      |     | course of   | mmittee |
| (BBL)  |          | from     |      |     | business,   | has the |
|        |          | hospital |      |     | charging at | opinion |
|        |          | services |      |     | normal      | that    |
|        |          | received |      |     | price and   | the     |
|        |          | from BBL |      |     | benefits as | tran    |
|        |          |          |      |     | customers   | saction |
|        |          |          |      |     | in general. | is      |
|        |          |          |      |     |             | reas    |
|        |          |          |      |     |             | onable. |
+--------+----------+----------+------+-----+-------------+---------+
|        |          | Expenses | 36.5 | 4   | BBL is the  | The     |
|        |          |          |      | 4.3 | credit card | Audit   |
|        |          | - Bank   |      |     | service     | Co      |
|        |          | credit   |      |     | provider    | mmittee |
|        |          | cards    |      |     | which the   | has the |
|        |          | co       |      |     | Company has | opinion |
|        |          | mmission |      |     | always      | that    |
|        |          | fees     |      |     | used. The   | the     |
|        |          | paid to  |      |     | Company     | tran    |
|        |          | BBL      |      |     | invested in | saction |
|        |          |          |      |     | various     | is      |
|        |          |          |      |     | infr        | reas    |
|        |          |          |      |     | astructures | onable. |
|        |          |          |      |     | to maximize |         |
|        |          |          |      |     | the         |         |
|        |          |          |      |     | benefits    |         |
|        |          |          |      |     | from        |         |
|        |          |          |      |     | efficient   |         |
|        |          |          |      |     | use of      |         |
|        |          |          |      |     | credit card |         |
|        |          |          |      |     | payment     |         |
|        |          |          |      |     | system. The |         |
|        |          |          |      |     | fees paid   |         |
|        |          |          |      |     | to BBL are  |         |
|        |          |          |      |     | at the      |         |
|        |          |          |      |     | market      |         |
|        |          |          |      |     | rate.       |         |
+--------+----------+----------+------+-----+-------------+---------+
| B      |          | - Rental | 20.1 | 3   | The Company | The     |
| angkok |          | of land  |      | 1.5 | rented a    | Tran    |
| Bank   |          | and      |      |     | building    | saction |
| Pcl.   |          | building |      |     | from BBL to | has     |
| (BBL)  |          | paid to  |      |     | support its | been    |
| (C     |          | BBL      |      |     | hospital    | a       |
| ont’d) |          |          |      |     | business    | pproved |
|        |          |          |      |     | and to use  | by      |
|        |          |          |      |     | for parking | shareh  |
|        |          |          |      |     | and         | olders. |
|        |          |          |      |     | serviced    |         |
|        |          |          |      |     | apartments  |         |
|        |          |          |      |     | for         |         |
|        |          |          |      |     | patients’   |         |
|        |          |          |      |     | families.   |         |
|        |          |          |      |     | The rental  |         |
|        |          |          |      |     | fees are    |         |
|        |          |          |      |     | reasonable. |         |
+--------+----------+----------+------+-----+-------------+---------+
|        |          | -        | 17.5 | 1   | The Company | The     |
|        |          | Interest |      | 7.5 | paid        | Tran    |
|        |          | on       |      |     | interest on | saction |
|        |          | con      |      |     | Baht 550    | has     |
|        |          | vertible |      |     | million     | been    |
|        |          | bonds    |      |     | principal   | a       |
|        |          | paid to  |      |     | of          | pproved |
|        |          | BBL      |      |     | convertible | by the  |
|        |          |          |      |     | bonds.      | shareh  |
|        |          |          |      |     | Interest    | olders. |
|        |          |          |      |     | rates are   |         |
|        |          |          |      |     | in          |         |
|        |          |          |      |     | accordance  |         |
|        |          |          |      |     | with debt   |         |
|        |          |          |      |     | re          |         |
|        |          |          |      |     | structuring |         |
|        |          |          |      |     | agreement.  |         |
+--------+----------+----------+------+-----+-------------+---------+
| Bumr   | Su       | Revenues | 9.9  | 3   | The Company | The     |
| ungrad | bsidiary |          |      | 6.9 | charges the | Audit   |
| I      | which    | -        |      |     | fees in     | Co      |
| nterna | the      | Co       |      |     | relation    | mmittee |
| tional | Company  | nsulting |      |     | with the    | has the |
| L      | holds    | fees on  |      |     | actual cost | opinion |
| imited | 51% with | hospital |      |     | of the      | that    |
| (BIL)  | common   | ma       |      |     | resources   | the     |
|        | director | nagement |      |     | used.       | tran    |
|        |          | received |      |     |             | saction |
|        |          | from BIL |      |     |             | is      |
|        |          |          |      |     |             | reas    |
|        |          |          |      |     |             | onable. |
+--------+----------+----------+------+-----+-------------+---------+

Other transactions 

  On 15 May 2006, the Company’s shareholders approved waiver of the
  Company’s right to subscribe to BIL’s new shares in order to allow
  Bangkok Bank Pcl to subscribe to new shares. Such waiver is a related
  transaction, with the details as follows:

  Related Company: Bangkok Bank Pcl. (BBL)

  Relationship: BBL, including its subsidiary, Sinnsuptawee Asset
  Management Company Limited, are major shareholders of the Company
  holding 136,158,279 shares or 18.65% of paid-up capital of the Company
  as of 20 January 2006. As a potential investor in Bumrungrad
  International Limited (BIL), a 99.99% owned subsidiary of the Company,
  BBL is considered a Connected Person.

  Description: - Waiver of rights by the Company to subscribe to
  1,176,469 shares in BIL in order to allow BBL to subscribe to the
  shares.

- BIL offers new 1,176,469 shares to BBL.

Amount (Baht Million): The value of the Transaction is approximately
Baht 180.6 million

  Pricing Policy The subscription price of the new shares of BIL of Baht
  153.52 was calculated based on the accumulated cost of investment by
  BH in BIL plus an agreed upon rate of return. This is in substantial
  premium to BIL’s book value per share of Baht 120.18 as of 31 December
  2005, which is in line with IFA report.

Reasons for the transaction:

  The Transaction was approved by the shareholders’ meeting on 15 May
  2006

11.2 The Necessity and Rationale of the Related Parties Transactions 

  The Company has entered into related parties transactions to support
  the normal business of the Company. The rental of building from
  Bangkok Bank Pcl (as detailed in notes to financial statements no. 7)
  has helped the Company to maintain and expand its international
  patient base. The corporate contracts and insurance contracts have
  helped expand the Company’s client base.

11.3 Approval Process for Entering into Related Parties Transactions 

  For contracts which were entered into as part of normal courses of
  business, the transactions are approved through the normal process in
  accordance with the Company’s policy. In addition, the Audit Committee
  has considered the appropriateness and reasonableness of these
  transactions. For other transactions which are significant in size as
  per the definition of the Stock Exchange of Thailand, Board of
  Directors’ and/or shareholders’ approvals are obtained in accordance
  with rules and regulations, where management and/or directors with
  vested interests are not allowed to vote.

 11.4 Policy on Related Parties Transactions in the Future

  The Company will continue to have related parties’ transactions, as
  these transactions are beneficial to the Company as explained earlier.
  The Company will strictly abide by the Company’s policy, as well as
  the rules and regulations of the Stock Exchange of Thailand. In
  addition, the Company will emphasize the transparency of the related
  parties transactions, and will protect the highest benefit of the
  Company.