The fund will be launched if the central bank abolishes its 30-per-cent capital-reserve requirement as the relatively large fund needs foreign investment, its chief executive officer Montree Sornpaisarn told reporters yesterday.

The central bank has now relaxed the measure by exempting capital inflows for mutual funds as long as the investments are fully hedged.

Earlier, ING Funds (Thailand) announced the launch of its sixth property fund next month, in which the underlying assets will be Major Cineplex and its rental space. Golden Land Property Development is also planning to launch a property fund next month, with Mayfair Marriott properties as underlying assets.  

Montree expects that the company's wholly-owned subsidiary mutual-fund company, with registered capital of Bt100 million, would soon get approval from the Securities and Exchange Commission (SEC).

"Expansion into the mutual-fund business would raise the company's revenue and fulfil our goal of offering integrated financial services," he said.

For the investment banking business, he said his firm would be involved in deals to float the initial public offering of two to five companies with a combined fund mobilisation of Bt10 billion.

Income from these deals is expected to be realised in the third quarter this year, he said. In addition, the company is acting as a financial adviser for merger and acquisitions by one or two companies. Montree declined to reveal further details.

Kim Eng plans to secure a foothold as a leader in the broking business with a market share of 8-9 per cent this year. The company has 57,000 stock trading accounts, of which 40 per cent are active. Retail investors account for 73 per cent of the company's total clients, foreign institutional investors 22 per cent, and local institutional investors make up the rest.

"The company cannot estimate revenues this year due to high fluctuations in the stock market. The average daily trading value this year will stand at Bt12 billion, down from Bt16.2 billion last year. I admit that our market share has shrunk because retail investors keep themselves at bay in an uncertain climate," said Montree.

Montree said that Kim Eng's revenues from the broking business in the first quarter this year would be disappointing due to the sluggish stock market.

Despite the thin trading volume, Kim Eng Securities would open one more trading room in Bangkok. Only a couple of the 39 trading rooms of Kim Eng Securities suffer operating losses, he said.

Siriporn Chanjindamanee

The Nation