The resignation of Krit Ratanarak from all positions at Bank of Ayudhya does not mean that there is no one representing the Ratanarak family to oversee the bank's policy, according to a source in the industry.

Krit's resignation is apparently his attempt to show that the country's sixth-largest bank - with GE Money as its strategic investor - will from now on be run only by professional bankers, the source said.

On January 10, BAY is expected to receive Bt22 billion from GE Capital International Holdings (GECIH). Although GE will then have a 29.4-per-cent stake in BAY, the Ratanarak family will still control a majority stake in the bank with 32 per cent, diluted from 37 per cent.

Krit resigned on Wednesday from his positions as chairman and director of the bank, along with Pakorn Thavisin who resigned as a director. The bank has appointed Kong Khoon Tan and Janice Van Ekeren to replace Krit and Pakorn, respectively.

In April last year, Krit resigned as the bank's CEO in response to the Bank of Thailand's call for good corporate governance, reflecting that he would leave operational tasks to oversee only policymaking.

Now, with Krit's absence from all posts in the bank, BAY - whose name has been attached with Krit's for decades - hopes to move forward without a family-run image towards international standards brought in by GE Money.

However, Krit's resignation does not mean that the Ratanarak family will not have anyone to take care of its business, said the source. The bank also appointed Veraphan Teepsuwan as the new chairman to replace Krit. The Teepsuwan family, in fact, has known the Ratanarak family since their father's generation, the source said.

Krit and Veraphan have reportedly done many business deals together. Veraphan's name has appeared as director and executive in a number of companies owned by the Ratanarak family since 1973.

For example, Veraphan is vice chairman and executive chairman of Eastern Star Real Estate, which is indirectly owned by the Ratanarak family. Veraphan is also chairman in Siam City Cement, Ayudhya Alliance CP Life and Ayudhya Insurance, which are all companies of the Ratanarak family and BAY.

Veraphan also reportedly played a key role in dealing with GE Money before the deal with the US giant was completed last year.

The bank's new chairman was an official in the Budget Bureau Office from 1966 to 1969. He also served as adviser to then-prime minister General Prem Tinsalanonda's administration in 1980-1981.

GE Money completed its strategic investment in BAY on Wednesday by officially transferring GE Money Retail Bank's assets and liabilities, including deposits, home mortgages and home equity loans, to BAY.

Executives of BAY and GE have started working on a strategic roadmap focusing on strengthening the Thai bank's expertise in retail products, customer relationship management, risk management and compliance.

In addition, both the bank and GECIH have conducted the same car-leasing services business, via Ayudhya Auto Lease and GE Capital Auto Lease, respectively. Both parties agreed that the bank would set up a new car leasing service firm called Ayudhya Capital Lease. Therefore, GE Capital Auto Lease has ceased operations, while Ayudhya Auto Lease will follow suit.

Along with Krit's resignation, GE Money said in its press release that BAY would from now on continue as a "board-run" company.

The bank's board now comprises Veraphan, the chairman, Ekasak Puripol, Thipsamat Na Chiengmai, Pongpinit Tejagupta, Kong Khoon Tan, Janice Van Ekeren, Phanporn Kongyingyong and Pornsanong Tuchinda. The bank's independent directors are Surachai Prukbamroong, Yongyuth Withyawongsaruchi, and Virat Phairatphiboon.

"We see this as an exciting partnership for us in Thailand," Yoshiaki Fujimori, president and CEO of GE Money Asia, said in the press release. "We are confident in the long-term prospects for the country. Our new investment in BAY is an important demonstration of our solid commitment."

Banking analysts have earlier pointed out that the complement from GE Money will make BAY's know-how in retail financial services much stronger. The bank will become one of the most competitive in the business.

Jiwamol Kanoksilp

The Nation