Mixed outlook in Asean for BBL
Bangkok Bank's international business this quarter is expected to witness a slowdown due to global market uncertainty, while Vietnam, which is an important market for BBL, has been sidelined by currency woes.
The devaluation of Vietnam’s dong has dampened loan demand at its branch in Vietnam, while trade in the first two months is unlikely to recover, so the bank’s lending in the international market could taper off slightly, executive vice president Chairit Anuchitworawong said last week.
However, the Indonesian, Laotian and Myanmar operations have a bright outlook, especially the Indonesian branch, which is the highest profit contributor among the bank’s 29 branches in 14 countries.
Thailand’s largest bank by assets will end this year with 31 branches in 14 countries. Cambodia was the latest country after the branch there was opened on December 30.
Myanmar will be the 31st branch when it starts business in the middle of this year. BBL is the only Thai bank to receive a banking licence from that country.
BBL is the first foreign bank in two years to get a licence from Cambodian authorities. A decade ago, BBL had a branch there.
Cambodia has some 40 banks, 10 of which are foreign. Given the size of its economy, it should more cautious in granting licences to foreign banks, as the IMF and World Bank have advised.
However, its central bank considered the strong foothold of BBL in Asean and the bank also said it could help the country attract investors.
Thai as well as Japanese, Chinese and Taiwanese companies are interested in investing in Cambodia.
BBL has a customer base in those countries, and when the Asean Economic Community kicks off at the end of the year, Asean including Cambodia will become the focus of foreign investors.
Over the past decade, the growth of BBL’s international business has migrated from northern to southern Asia.
BBL has known that it should have more branches in Asean even though it already has some in those countries.
Indonesia is the growth market. The bank believes it should have more branches there to accommodate the rise in investment.
In 2012 and 2013, two branches were added in Surabaya and Medan.
BBL wants to open more branches in nine Asean states excluding Brunei, if it has the opportunity.
In Laos, it will open the second branch in Pakse to cash in on the investment flows in the south of that country.
To help lure Thai direct investment, BBL’s branch managers in Asean will enunciate the business opportunities for Thai companies in their countries at the bank’s AEC business forum on Friday.
