Upbeat about Thailand’s growth, LH Financial Group unveils expansion plan for 2023

Reviewing their performance in 2022, Shih Jiing-Fuh, president of LH Financial Group, said on Thursday that the group is very confident of Thailand's growth this year.

He said the Thai economy is expected to grow by 3.7% in 2023, owing to improved tourism, the employment situation, and more private investment, along with a gradual decline in inflation and energy prices.

Although other risk factors, such as geopolitical tensions, may have an impact on Thailand's recovery, these scenarios would also be excellent opportunities for Thailand, he said.

Relocation of businesses
He explained that many entrepreneurs and manufacturers are considering relocating their businesses in order to mitigate the risk of supply chain disruption.

Thailand is one of the first destinations in the Asia-Pacific region that business owners, particularly Taiwanese, consider when looking to relocate or diversify their manufacturing base, he said.

The movement followed last year's notable expansion of loans to small and medium-sized businesses (SMEs) (by 35%) and loans to Taiwanese companies (by 95%).

Wide range of products

"The group's 2023 strategy focuses on offering a comprehensive range of financial and investment products that are appropriate for customers' circumstances and investment timing via the digital platform," he said.

He explained that the action included synergy strategies between the entities in the financial business group and CTBC, the parent company of the LH Financial Business Group, to jointly tailor products and services to the needs of all customer segments.

LH Financial Group reported a net profit of 1.579 billion baht, up 14.1% year on year, in 2022 mainly due to an increase in interest income. Loan growth was 23% from all segments while none-performing loans (NPL) were low at 2.09%, down from 2.44%.

The bank has also set a substantial amount of provision for doubtful accounts to buffer the impact from customers potentially affected by Covid-19. As a result, NPL coverage stood at 221%, he said.

The president said the company's key financial targets in 2023 are: 8-10% total loan growth, 10-12% core income growth, and NPL ratio less than 2.5%.
Besides, it plans to increase retail and SME customers by 10-15% this year, while Taiwanese clients will double from last year.

Investment plan
Chompoonoot Pathomporn, the CEO and president of Land and Houses Bank, added that the bank has set aside 1.2 billion baht for investment this year.

The budget will fund some promising projects, risk management tools, digital enablement, foreign transaction engagement, and portfolio expansion.

She noted that the bank's strategy for 2023 is to emphasise loan portfolio growth that generates good returns from high-yield segments with proper risk management, as well as cross-selling of the bank's products and increasing fee income, and developing digital capabilities that help improve work processes to be more agile.

She pointed out that as the financial services industry experiences technological disruptions, the bank is focusing on developing new business models that use various forms of technology to provide more effective financial services.

"Sustainability, digital enablement, resilience, and an appropriate risk appetite are the key pillars in developing the strategic plan," she explained.

Focus on private fund customers.

Monrat Phadungsit, president of LH Fund Management said that the strategy this year is to expand private fund customer base, both institutional and ultra-high-net-worth individuals.

He said the company is working to improve digital service systems through online platforms in order to facilitate investment for all investors, with the goal of increasing sustainability-related funds to around 2.5% of the LH Fund's total portfolio this year.

Funds under management of the company, which included property funds and real estate investment trusts, was approximately 55.657 billion baht, a 15% decrease year on year.

Private funds had a size of 14.235 billion baht with 51% growth, while provident funds were 6.046 billion baht with 4% growth.

Kan Atthamsunthorn, president of LH Securities showed the strategic plan for 2023 that the company continued the focus on sustainable growth by enhancing technologies to boost competitiveness and increase convenience for customers.

LH Securities aims to extend investment services to new segments of customers through the use of data analytics in parallel with investment product development.

LH Securities reported total brokerage fee income of 186.1 million baht in 2022, down from 2021, in line with the sluggish stock market turnover compared to the high base in 2021. The company received total interest and dividend income of 414.6 million baht, up 9.8% from 2021, resulting in a net profit of 134.6 million baht.