• 
• 

Published on February 8, 2008

The retail bank has previously revealed plans to increase its registered capital from Bt3.4 billion to Bt5 billion and to list on the Stock Exchange of Thailand. After its recapitalisation is complete, the bank is also planning to apply next year for a full commercial banking licence from the Bank of Thailand.

A share offering to a foreign strategic partner will possibly take place during or after the recapitalisation process.

"We need a strategic partner to help the bank's commercial loan expansion, particularly in small- and medium-sized enterprise loans," Sasitorn said. "The bank already has an advantage in the mortgage lending business. Right now, we're in talks with a foreign investor who has never before done financial business in Thailand."

LH Bank has been operating a retail banking business since late 2005, focusing on housing loans as its core business. Mortgages represent 80 per cent of the bank's total loan portfolio of Bt25.6 billion. The retail bank is owned by two real-estate companies, Land and Houses (LH) and Quality House (QH), both belonging to property tycoon Anant Asavabhokhin. LH and QH hold stakes of 43 per cent and 27 per cent, respectively, in LH Bank. Combined with a private shareholding, the Asavabhokhin family owns 90 per cent of LH Bank.

Under its current retail banking licence the bank's business is limited, despite the strength of its capital base and its shareholders. According to the central bank's regulations, it can provide commercial loans up to 10 per cent of its capital base, or a maximum of Bt220 million, per borrower.

Somruedi Banchongduang

 The Nation