1. Interest income is expected to grow at the rates shown in the table below. From 2014 to 2016, with SCB's downturn, modest growth using the average growth rate from 2008 to 2013 of 2.48 per cent is projected. From 2017 to 2023 , SCB will enter a higher growth phase and a 4.5 per cent growth is assumed. Beyond that, the terminal growth rate is estimated to be 5 per cent. The base interest income at Year -1 (FY2013) is \$17,593. Year 0 is FY2014. Discount the free cash flows starting from 2015 . 2. Other items are assumed to grow proportionately with interest income. Interest expense, non-interest income, provision for credit losses, and non-interest expense are estimated to be 41.35 per cent, 48.04 per cent, 8.58 per cent and 58.47 per cent of interest income, respectively. Tax is applied at 28.714 per cent on taxable income. 3. As SCB's interest expense is considered a "cost of goods sold" due to the nature of the banking business, the free cash flows are calculated after deducting interest expense and therefore are essentially cash flows to equity. 4. The valuation assumes that capital spending and net operating working capital are negligible. 5. No adjustments for outstanding warrants and share options are made in calculating value per share. Year-on-Year Interest Income Growth Source: Created by the authors based on assumptions stated above. 1. Interest income is expected to grow at the rates shown in the table below. From 2014 to 2016, with SCB's downturn, modest growth using the average growth rate from 2008 to 2013 of 2.48 per cent is projected. From 2017 to 2023 , SCB will enter a higher growth phase and a 4.5 per cent growth is assumed. Beyond that, the terminal growth rate is estimated to be 5 per cent. The base interest income at Year -1 (FY2013) is \$17,593. Year 0 is FY2014. Discount the free cash flows starting from 2015 . 2. Other items are assumed to grow proportionately with interest income. Interest expense, non-interest income, provision for credit losses, and non-interest expense are estimated to be 41.35 per cent, 48.04 per cent, 8.58 per cent and 58.47 per cent of interest income, respectively. Tax is applied at 28.714 per cent on taxable income. 3. As SCB's interest expense is considered a "cost of goods sold" due to the nature of the banking business, the free cash flows are calculated after deducting interest expense and therefore are essentially cash flows to equity. 4. The valuation assumes that capital spending and net operating working capital are negligible. 5. No adjustments for outstanding warrants and share options are made in calculating value per share. Year-on-Year Interest Income Growth Source: Created by the authors based on assumptions stated above