CIMB Thai plans for operations in Laos
CIMB Group will expand its network in Laos through CIMB Thai Bank to benefit from the closer relationship between the two countries.
Subhak Siwaraksa, president and chief executive officer of CIMB Thai, said that the bank had been asked by the Malaysia-based CIMB Group to study the Laos market in order to open branches there.
Unlike Myanmar or Cambodia, where the CIMB Group is expanding its presence, the group believed it should use CIMB Thai to expand the network in Laos as the two countries share a historical and trade relationship.
Subhak said CIMB Thai plans to set up the first branch in Vientiane and another branch in Savannakhet, which is an important trading location as it borders Mukdaharn in Thailand, Vietnam and China.
He said he could not say when the branch would open in Laos because it was just beginning a study of the market.
Earlier, CIMB Group chief executive Seri Nazir Razak said that the group would apply for a banking licence in Laos in its bid to cover the entire Asean market.
Subhak said that at the beginning in Laos, CIMB Thai branch would provide financial services for consumer banking before expanding to trade finance and investment banking to corporate customers.
The Lao people are using more ATMs now instead of carrying cash as before, while hire purchase is an interesting business in that country due to the increasing number of motorcycles sold, he said.
In the Asean region, CIMB Group has no network in Laos, the Philippines and Brunei, while in Myanmar, CIMB Group has a representative office.
Krung Thai Bank president Apisak Tantivorawong said that Thai banks are in a better position than regional or global banks to provide financial services in developing countries such as Laos because the small scale of operations in Laos would be unappealing to them.
KTB has one branch in Laos and plans to open a new branch in Vietnam. The bank is also applying to China's central bank to facilitate yuan currency transcations at the Kunming branch to serve the rising border trade.
KTB is the second Thai bank to set up a representative office in Myanmar. The bank will officially open the office in September.
Kasikornbank and Siam Commercial Bank also plan to open their representative offices in the same month.