Thai lenders strengthen Southeast Asian presence

Thailand's major banks have further expanded their networks in the region, especially in Myanmar.

This is in preparation for the upcoming Asean Economic Community, but with different strategies for tapping these markets.

Krungthai Bank and Siam Commercial Bank opened their first representative offices in Myanmar last year, while Kasikornbank will open its first one on Wednesday. Bangkok Bank opened a representative office in Myanmar almost 17 years ago.

All the banks expect the Asean market to contribute more revenue in the near future.

Bangkok Bank has 26 branches in 13 foreign markets, seven of which are in Asean. Its strategy is to study business opportunities in foreign markets in collaboration with customers to ensure it can support their business needs. It plans to open its third Indonesian branch in Medan soon, and will consider resuming operations in Cambodia.

According to the bank, Myanmar and Laos have economic-growth rates of 10 per cent, against 5-6 per cent in Indonesia and Malaysia. But it focuses on Indonesia because it is the biggest economy in Asean. Executive chairman Kosit Panpiamras expects Thai companies to expand their businesses there.

At the same time, Bangkok Bank sees high potential in Myanmar. Having operated a representative office there for 17 years, the bank is ready to provide full services.

Kosit said overseas branches contributed 18 per cent of the bank's revenue, a proportion the bank wanted to maintain.

Krungthai Bank opened its first representative office in Myanmar last month, so its foreign network now covers three countries in Asean. KTB operates two branches in Cambodia and one in Laos.

KTB sees its role as the "gateway bank" in preparation for the AEC, said chief financial officer Kittiya Todhanakasem. This means it will be able to provide financial transactions to Thai businesses from its branches in border provinces because it has the largest number of branches in those parts of Thailand.

The bank plans to open a branch in Vietnam this year.

Siam Commercial Bank places importance on creating brand awareness in Asean countries because it plans to play the role of a regional bank.

"Everyone should know who we are, whether they are SCB clients or not. The opening of our first representative office in Myanmar in November was a key step in creating SCB's footprint as a regional bank," said executive chairman Vichit Suraphongchai.

SCB's three-year regional expansion plan first focuses on Indochina and the GMS countries.

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