Bank of Ayudhya or Krungsri, a member of Mitsubishi UFJ Financial Group (MUFG), has announced strategies to expand its corporate banking business with the aim of becoming the primary bank for its corporate clients by 2017.
Pornsanong Tuchinda, Krungsri’s head of commercial banking, said the strategies for his business unit were in line with the bank’s mid-term business plan, which focuses on growing assets, increasing fee income and reducing the cost of funds.
The strategies encompass new client acquisition and clear customer segmentation, driven by a "customer-centric" approach.
"We aim to provide a one-stop service for total financial solutions, including cash management, trade finance, foreign exchange and derivatives, investment banking and project finance to our clients as well as support their business expansion outside Thailand, especially to Japan, China, and the Asean region," he said.
Pornsanong said the synergy with MUFG enhanced its competitive advantage in terms of organisational and product-offering capabilities as well as sharing best practices through MUFG’s network in more than 40 countries around the world.
He said Krungsri had been empowered to respond better to the financial needs of its corporate clients through a complete range of financial solutions along with enhanced readiness to unleash clients’ growth potential through overseas expansion. Recent notable examples included Krungsri’s financial support for Central Group’s expansion of its retail business to Europe and Thai Summit’s business investment in India.
Additionally, the bank will focus on offering investment-banking services, initially by providing advice on fund mobilisation through corporate debt instruments as well as project financing to support private investment and the development of infrastructure in Thailand. Project finance is an area in which MUFG has expertise and is a global leader, Pornsanong said.
Apart from providing financial services and products to commercial clients, Krungsri also focuses on offering value-added services, including business matching for Thai corporates looking for opportunities to expand into Japan and other countries worldwide and for Japanese clients who are exploring investment opportunities in Thailand, he added.
The implementation of such strategies has an ultimate goal of transforming Krungsri into the primary bank for its corporate clients by 2017.
Commercial clients currently account for 60 per cent of the bank’s loan portfolio, of which 29 are corporate clients. For 2015, Krungsri has set a loan-growth target of 6 per cent for corporate banking business. Though that target is higher than the projections for growth in gross domestic product, the bank is confident that the synergy with MUFG will be a key driver towards the target.