LH Group still seeking partner to back e-banking operations
Play
New securities arm to focus on institutional investors at first
Chairman Anant Asavabhokhin says LH Financial Group needs a partner to help it strengthen its e-banking, as it sees this as the future of the banking business.
LH Group, the parent company of Land and Houses Bank, has been looking for a strategic partner for many years.
The search recently became a hot issue when several media outlets reported that the bank was in talks with Charoen Pokphand Group, before Dhanin Chearavanont, chairman of CP, denied any such deal last month.
Anant said that if LH establishes a partnership, the group would issue new shares to the partner instead of selling existing shares.
The amount of new shares will depend on the requirements of the partner.
LH Financial Group holds 100 per cent of LH Bank, while Land and Houses Group holds more than 60 per cent of LH Financial Group.
“We don’t mind if the future partner becomes the major shareholder in LH Financial Group if it has a certain strategy for conducting e-banking and has common interests with us,” he said.
He said the group had talked with two potential partners, a local and a foreign financial institution.
The partner must have expertise in e-banking not just traditional banking, he added
Small institution
The group is putting information-technology infrastructure in place to deal with e-banking even though it has no partner yet because the bank has to keep operating as usual.
As a small institution, LH Bank has projected annual loan growth of two or three times the expansion of the country’s gross domestic product.
This year, LH Bank’s lending grew by around 10 per cent.
High household debt is a challenge for lenders because this has an impact on retail consumers and small and medium-sized enterprises that have been affected by the slow economy.
Anant believes government spending and consumer confidence will be the key drivers of the economy next year. One positive factor that will help businesses is lower fuel prices, which bring down operational costs including logistics.
The group yesterday staged the official launch of Land and Houses Securities.
In the beginning, the firm will focus on institutional investors because they are LH Financial Group’s business partners as well as existing customers.
In the medium term, the company plans to broaden to individual investors, as this segment has shown the highest growth during the past decade.
