Sep. 17--Kasikornbank said it would take over factoring services for small business clients from its subsidiary from 2010.

Bank president Prasarn Trairatvorakul yesterday said that starting next year, Kasikorn Factoring would focus more on machinery and equipment financing, including hire-purchase, financial lease and operating lease services.

The subsidiary aims to double its business volume and maintain its leading position in the machinery and equipment leasing business over the next three years. KFactoring had a market share of 21 percent at the end of 2008, with industry turnover currently estimated at 100 billion baht.

Dr Prasarn said KFactoring, despite its leading market position, was constrained in its ability to offer services by the lack of a foreign exchange license and an insufficient service network.

As a result, KBank will begin offering factoring services directly to its small business clients, including financing facilities against account receivables pledged as collateral.

Dr Prasarn said the group aimed to build its total market share to 30 percent of the industry by 2011, and expected strong growth to its broad customer base and international trade network.

KBank, the country's fourth-largest bank by assets, is forecasting loan growth of 4 percent for the full year as the economy continues to improve.

The bank's loan portfolio was now flat against the end of last year compared with a 2 percent contraction in the first half, according to Dr Prasarn.

He said the bank was easing its lending policies in light of declining economic and credit risks. Demand for credit is expected to increase as the economy improves and production picks up.

KBANK shares closed yesterday on the Stock Exchange of Thailand at 77.75 baht, up 50 satang, in trade worth 692.8 million baht.

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