Krungsri to help SMEs widen their markets
BANK OF AYUDHYA, or Krungsri, is counting on business matching in its bid to help small and medium enterprises (SMEs) market their products and services, both locally and overseas.
“We hope business matching will help build a strong relationship with SMEs and lead to sustainable loan growth,” Sayam Prasitsirigul, head of SME Banking, said yesterday.
Since SMEs are not familiar with markets both local and overseas, the bank will cooperate with major partners from the private sector with a presence in foreign markets and from the public sector to help SMEs sell their products in international markets, especially CLMV (Cambodia, Laos, Myanmar and Vietnam), he said.
Krungsri has joined forces with Ensogo, the leading business website for social commerce, Loxley, the Federation of Thai Industries and the Department of Industrial Promotion to introduce opportunities and markets to SMEs.
Loxley, a leading trading firm, has experience in China and CLMV that can help SMEs in the food and beverage industry to understand those markets.
SMEs currently export their products to border provinces. The bank wants to encourage SMEs engaged in manufacturing to expand to CLMV.
Krungsri has no loan portfolio in CMLV.
The sustainable growth of Krungsri is 15 per cent per year. This seems aggressive but the bank wants to join the top three SME lenders by 2016 with a portfolio of more than Bt300 billion, up from Bt196 billion as of end of June.
Loans in the first six months expanded by 8 per cent. After considering the loans in the pipeline this quarter and the peak season next quarter, the bank believes it can hit the growth target of 15 per cent.
The economic downturn has not bruised SMEs, as the slowdown in GDP growth was the result of a decline in spending due to high household debt.
After the disappointing performance in the first half, the economy will return to its normal growth path in the next six to 12 months as the household debt situation improves.
SME loans are expected to expand at 2-3 times the rate of GDP.
The group’s new major shareholder, Bank of Tokyo-Mitsubishi UFJ, will strengthen the supply-chain business, as Krungsri has a few Japanese SME customers.
Krungsri’s policy for the SME business will become clearer after the deal with the Japanese bank closes by year-end, he added.
