Scotiabank goes for 49%

Canada-based Scotiabank, one of the 100 largest banks in the world, plans to spend US$225 million (Bt7.6 billion) to raise its stake in Thanachart Bank from 24.99 per cent at present to 49 per cent.

The bank is seeking approval from the Bank of Thailand.

"We need to spend $225 million on buying the stake from Thanachart Capital, which was the biggest shareholder in Thanachart Bank, but it depends on when the BOT will approve the move," Richard Waugh, president and chief executive officer of Scotiabank, said yesterday at a press briefing during his visit to Thailand.

The Financial Institution Act, which came into effect in August, raised foreign investors' maximum ownership in Thai financial institutions to 49 per cent.

He said his bank had made a decision to expand investment in Thailand and China, two of the 50 countries where Scotiabank has invested, despite the global financial turbulence.

Scotiabank is in talks with two Chinese banks and a company in China.

Such investment shows the bank's confidence in these countries, he said. The bank believes the growth rate in Asia over the next five to 10 years will be better than that for North America, he added.

Waugh said Thanachart Bank had performed very well in many respects such as net profit, number of branches, increase of products and services, treasury department and operation.

In addition to monetary issues, Scotiabank will support the bank in human resources, technology and know-how with a view to making it the most competitive in Thailand.

The Scotiabank president also said he had a positive long-term view of Thailand.

Meanwhile, the bank has plans to expand its investment in China by increasing its shareholding in Xian International Bank to 20 per cent, and via a new investment of 7 to 10 per cent in Bank of Dalian. The asset sizes of these two institutions are $7 billion and $12 billion, respectively.

Moreover, it will increase its share in a Bank of Beijing subsidiary to 33.3 per cent.

Scotiabank has been in operation for 176 years and has 60,000 employees in 50 countries.