Thanks to the planned hike in capital from Bt57.6 billion to Bt72
billion, Krung Thai Bank believes that it will have enough financial muscle to
serve non-Thai customers such as state agencies in Myanmar and Vietnam through
future branches there.
"The bank wants to expand
its business in the Asean Economic Community via branches rather than
representative offices to offer a full range of financial services, not just
currency services," Kittiya Ttodhanakasem, a senior executive vice
president at KTB, said yesterday.
In Myanmar, KTB is opening |a
representative office, but wants |to upgrade it into a branch when regulations
there permit it.
With representative offices, Thai
banks are limited in the services they can provide in Myanmar.
The Central Bank of Myanmar is
expected to amend its regulations to allow foreign banks to set up branches
because it is studying |the financial regulations in the region.
"We expect Thai customers
and their partners will need credit for cross-border trade, while KTB, which is
a state-run bank, can play a role in providing loans to state agencies in each
country in Asean," she said.
The Bank of Thailand recently
approved KTB's request to open a branch in Vietnam. KTB is applying for a
branch licence to the State Bank of Vietnam, that country's central bank.
The model in Vietnam is similar
to Myanmar in that the branch will extend credit services to Vietnam's state
agencies including the central bank if they want to borrow from a Thai bank.
KTB has set up a representative
office in Vietnam but the political situation there does not appear to support
the banking business, Kittiya said.
"The economy in Vietnam has
changed. Vietnam is one of the high-potential countries in Asean because the
country has reformed its banking industry, while growing trade between Thailand
and Vietnam is fuelling demand for loans," she said.
"When the central bank of
Vietnam gives a licence to KTB, the bank will go ahead with setting up the
branch," she said.
SUCHEERA PINIJPARAKARN
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