Oct. 5--Kasikornbank has set an ambitious target for its banking business in China next year, in response to the mainland's robust economic growth.

Pipit Aneaknithi, the bank's first senior vice-president, said KBank would mainly pay attention to its overseas banking business in China next year as the Chinese economy has great potential after posting high growth for years.

The bank expects loans to soar next year at its only branch in China, in Shenzhen. Although KBank has yet to finalise its business plan in China, it is optimistic lending will more than double in 2010.

"Our aggressive loan target will be supported by the Chinese economic expansion and a low base of our operation over there," said Mr Pipit.

This year, KBank aims to extend new loans of 200 million yuan, about 1 billion baht, from its Shenzhen branch, focusing on small and medium-sized enterprises. From last May to date, the bank has lent 50-60 million yuan, or about 300 million baht, after receiving approval to offer local-currency financial services from the Chinese government.

The Shenzhen branch's operation is in co-operation with China Minshen Banking Corp, one of the largest commercial banks in the mainland.

Mr Pipit said the bank's clear business strategy in China focusing on SMEs would be another factor to support its growth due to low competition in the segment. The bank expects better margins from SME loans in China compared with similar credits in Thailand.

Chinese SME operators typically want credit lines of about 20 million yuan each. The loan demand would not exceed 60 million yuan for each client while the loan repayment period would be limited to one year.

In addition to its Shenzhen branch, KBank plans to open more outlets in China and it also has three representative offices in Beijing, Shanghai and Kunming, with about 30 staff in total.

Mr Pipit said the bank also planed to adjust the business strategy of the Hong Kong branch in the area of money and capital market services to support demand from local investors. Currently, KBank's Hong Kong branch provides trade financing services, mainly to Thai customers.

KBank shares closed on Friday on the Stock of Thailand on Friday at 84.25 baht, down 1.25 baht, in trade worth 579.6 million baht.

-----

To see more of the Bangkok Post, or to subscribe to the newspaper, go to http://www.bangkokpost.com.

Copyright (c) 2009, Bangkok Post, Thailand

Distributed by McClatchy-Tribune Information Services.

For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

KPCPF,

A service of YellowBrix, Inc.