Thailand’s SCB eyes expansion in Vietnam
Siam Commercial Bank (SCB) is keen to flex its muscles in Vietnam by opening its own branch rather than a joint venture in a bid to cash in on rising foreign direct investment (FDI) and the expansion of banking in the country, the Bangkok Post reported.
Chairman Vichit Surapongchai said Thailand, Vietnam and Indonesia were the region’s main destinations for FDI, and Vietnam’s banking sector still had growth potential. Thailand’s third-biggest lender by assets owns 33 per cent of Vinasiam Bank, which has eight branches in Vietnam. The state-owned Vietnam Bank for Agriculture and Rural Development owns 34 per cent of Vinasiam and Charoen Pokphand Group 33 per cent.
SCB’s decisions will hinge on Vietnamese law governing foreign ownership in the financial sector. Vietnam is amending the law to let foreign investors take a larger stake in the nation’s lenders in a bid to reshape the banking system as it reels from a high rate of bad loans.
The banking system in Vietnam has 54 foreign bank branches, five joint-venture banks, 17 financial firms, 12 financial leasing companies and nearly 1,100 credit funds, according to the Vietnamese central bank, which also counts 60 representative offices of foreign banks.
“We will contemplate details if the government allows us to increase our stake” in the Vietnamese bank,” Vichit said, adding that SCB preferred to invest through its wholly owned operations. SCB peers Bangkok Bank and Kasikornbank have also made their presence felt in Vietnam through branch openings and cooperation with local partners.
It will focus on broadening its business in Cambodia, Laos, Myanmar and Vietnam, but any investment decision will depend on the infrastructure in each country.
“The local market is not very good, but still it is unnecessary to invest abroad with the aim of offsetting that,” Vichit said.
SCB has banking operations in Laos, Cambodia, Singapore, Hong Kong and Myanmar.
Siam Commercial Bank (SCB) is keen to flex its muscles in Vietnam by opening its own branch rather than a joint venture in a bid to cash in on rising foreign direct investment (FDI) and the expansion of banking in the country, the Bangkok Post reported. Chairman Vichit Surapongchai said Thailand, Vietnam and Indonesia were the region's main destinations for FDI, and Vietnam's banking sector still had growth potential. Thailand's third-biggest lender by assets owns 33 per cent of Vinasiam Bank, which has eight branches in Vietnam. The state-owned Vietnam Bank for Agriculture and Rural Development owns 34 per cent...
Siam Commercial Bank (SCB) is keen to flex its muscles in Vietnam by opening its own branch rather than a joint venture in a bid to cash in on rising foreign direct investment (FDI) and the expansion of banking in the country, the Bangkok Post reported.
Chairman Vichit Surapongchai said Thailand, Vietnam and Indonesia were the region’s main destinations for FDI, and Vietnam’s banking sector still had growth potential. Thailand’s third-biggest lender by assets owns 33 per cent of Vinasiam Bank, which has eight branches in Vietnam. The state-owned Vietnam Bank for Agriculture and Rural Development owns 34 per cent of Vinasiam and Charoen Pokphand Group 33 per cent.
SCB’s decisions will hinge on Vietnamese law governing foreign ownership in the financial sector. Vietnam is amending the law to let foreign investors take a larger stake in the nation’s lenders in a bid to reshape the banking system as it reels from a high rate of bad loans.
The banking system in Vietnam has 54 foreign bank branches, five joint-venture banks, 17 financial firms, 12 financial leasing companies and nearly 1,100 credit funds, according to the Vietnamese central bank, which also counts 60 representative offices of foreign banks.
“We will contemplate details if the government allows us to increase our stake” in the Vietnamese bank,” Vichit said, adding that SCB preferred to invest through its wholly owned operations. SCB peers Bangkok Bank and Kasikornbank have also made their presence felt in Vietnam through branch openings and cooperation with local partners.
It will focus on broadening its business in Cambodia, Laos, Myanmar and Vietnam, but any investment decision will depend on the infrastructure in each country.
“The local market is not very good, but still it is unnecessary to invest abroad with the aim of offsetting that,” Vichit said.
SCB has banking operations in Laos, Cambodia, Singapore, Hong Kong and Myanmar.
