ASEAN KEY DESTINATIONS
Kasikorn expands in China
Chief executive Banthoon Lamsam said the bank aimed to expand SME loans in China to 1 billion yuan (5 billion baht) by the end of the year from 400 million yuan (2 billion baht) now.
The bank maintains a positive outlook for its business in the mainland in line with the country's robust economic growth. However, it remains vigilant, especially, after China's central bank tightened banking reserve requirement.
China's central bank recently raised for the fifth time this year the reserve requirement ratio (RRR) of the country's lenders to curb lending. The half-percentage-point increase brought the ratio to a record high 21 percent compared to 6 percent during 2006-07.
The measure is expected to ease inflationary pressure and cool the fast-growing economy.
''Even though the stricter rule might slow loan expansion, it would help control our asset quality. While there remain great business opportunities in China, the important thing is good risk management,'' Mr. Banthoon said.
KBank, Thailand's third largest bank in terms of total assets, has only one branch in Shenzhen which focuses on serving Chinese SME clients in the local currency. Chinese SME operators typically want a credit line of about 20 million yuan but not more than 60 million.
The Shenzhen branch's operation cooperates with the China Minsheng Banking Corp, one of the biggest commercial banks in the mainland. As well, the bank has three representative offices in Beijing, Shanghai and Kunming
To support expansion, Mr. Banthoon said the Shenzhen branch would recruit around 150 Thai and Chinese staff, adding to its 90-strong workforce. KBank would consider opening another branch in the mainland next year, but its business model has not been finalised yet.
''Together with our local business partner, we can expand our business satisfactorily, but going it alone is our key point for the longer term. In the meantime, our next step is to offer other financial services including deposits,'' he said.
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