By SUCHEERA PINIJPARAJKARN
SIAM COMMERCIAL BANK has facilitated a working-capital loan of Bt6 billion to Jasmine International for the listed company’s expansion of its broadband business, with telecom operators and power plants identified as promising industries for the bank’s sup
Jasmine International is a new customer for SCB, and one that is in its view in a strong sector and could strengthen the bank’s digital business, he said.
Asked about the possibility of the bank investing in Jasmine’s stock, in light of SCB’s purchase of a 3-per-cent stake in listed renewable-energy company Gunkul Engineering, Arthid said it would consider such investment on a case-by-case basis.
The bank yesterday signed a project-finance deal worth Bt4.5 billion with Gunkul Engineering for the company’s construction of a wind farm with a capacity of 67.5 megawatts.
Gunkul will set up an infrastructure fund with a planned initial value of Bt5 billion, with SCB being financial adviser for the deal. Telecoms and power plants are currently seen as promising industries by SCB and, apart from Gunkul, the bank has many project-finance deals related to power plants in the pipeline, its CEO said.
However, demand for working-capital loans this year is unlikely to be as high as expected because the capacity-utilisation rate of the manufacturing sector is not full, due to weak global demand, he explained.
SCB has recorded new lending of around Bt100 billion so far this year, but will not set a full-year target for loan growth as it wants to see how organic growth pans out in reality over the remainder of the year, he said.
Pressure on reserve
The bank is attempting to maintain a coverage ratio of 130-140 per cent, hence an aggressive loan-growth target might put pressure on the high reserve level, he added.
Arthid said SCB would also maintain momentum for a net interest margin of 3.24 per cent, with careful funding-cost management the way to sustain the margin.
Currently ranked as having the second-lowest funding cost among the country’s banks, SCB will focus more on expanding its deposit base to current and savings accounts, as it believes this sustained approach will enable it to have the lowest funding cost among its peers, the chief executive said.
Arthid, who was appointed president on July 1, said the bank had submitted its new management structure to the Bank of Thailand. The new structure should be announced next week, with the number of senior executive vice president and first executive vice president positions being reduced from 30 to 20, he added.