THURSDAY, March 28, 2024
nationthailand

KTB ups Myanmar presence; big firms, JVs in focus

KTB ups Myanmar presence; big firms, JVs in focus

Krungthai Bank has broadened its network in Myanmar with a focus on large local firms and joint ventures.

KTB president Vorapak Tanyawong said yesterday that Myanmar was one country outside Thailand that bore close observation because of growing investment and border trade.
The bank currently uses its border branches to serve Thai small and medium-sized enterprises with transactional and financial services.
About 90 per cent of Thailand’s Bt150-billion trade with Myanmar goes across the border, he said.
Thailand’s second-largest bank set up its first representative office in Yangon last week. It plans to apply the business model of its border branches aimed at capturing larger Thai and Myanmar firms.
Other Thai banks with a rep office in Myanmar are Bangkok Bank and Siam Commercial Bank. Kasikornbank will follow next month with an office in Yangon.
KTB believes its rep office will be new stepping stone for it to reach more Myanmar firms. he good relationship of the two governments is helping to boost investment and trade.
The Myanmar government is expected to support KTB, since the bank’s major shareholder is the Thai government.
The bank will start approaching Myanmar firms and companies with Thai partners. Joint ventures and new projects that are looking for local partners are also promising customers.
There are few larger Myanmar companies and some have little expertise in developing businesses, so they have to have partners. This opens opportunities for Thai firms.
The rep office is the first of four steps in establishing a strong presence in the western neighbour. KTB might consider setting up a joint venture with local banks. Next would be a wholly owned subsidiary. The ultimate step is to open a full-service branch. This process depends on the central bank in Myanmar.
“If the economy there continues to grow rapidly, we hope our full branch can be opened in five years,” Vorapak said. Until then, KTB will use its border branches to provide loans and transaction services to supply chain businesses, which are expanding to cash in on the Asean Economic Community in 2015.
For next year, even though KTB is satisfied with its current portfolio, it wants to expand SME lending and build brand awareness in retail banking among the private sector.
Civil servants are the main customers of retail banking, accounting for 70-80 per cent.

 

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