Bangkok Bank announces its intention to be a bridge connecting investment in ASEAN.
"Bangkok Bank has been in each country for a long time and has been with that country through every cycle, whether good or bad, which is Value Doing business like in Thailand, the bank has an age. 80 Year, the first overseas branch is Hong Kong, age 70 Year, which reflects that the bank has never backed down, always there, no matter what the situation is in that country."
As a major commercial bank in Thailand, Bangkok Bank has become a leading bank in the Southeast Asian region with a long-established international branch network covering nine ASEAN countries: Cambodia, Indonesia, Lao People's Democratic Republic, Malaysia, Myanmar, Philippines, Singapore, Vietnam, and Indonesia; and in Asia: China, Hong Kong, Japan, Taiwan, as well as the United Kingdom and the United States.
In 2563, Bangkok Bank acquired Bank Permata, one of the 1 largest commercial banks in Indonesia, the largest economy in ASEAN, and is attracting interest from investors around the world.
There are also Bangkok Bank Berhad in Malaysia, which provides full-service commercial banking, and Bangkok Bank (China), which provides full-service financial services to both individual and business customers operating in China. With its strong network, the bank can act as a bridge for Thai investors who wish to invest overseas, and foreign investors interested in investing in Thailand and ASEAN.
In 2567, Bangkok Bank's foreign banking business will be under the supervision of Charoenlap Thammanichanon He started working with Bangkok Bank in 2551 in the International Banking Department, initially working at the head office in Thailand for about 2 years before being assigned to Bangkok Bank's Singapore branch, where he stayed for 8 years. After that, in 2562, he was transferred to Bangkok Bank (China), which is a local Chinese bank that is a subsidiary of Bangkok Bank. In 2567, he was assigned to oversee all of Bangkok Bank's international banking activities.
Charoenlap Thammanichanon, Assistant Managing Director, International Banking, Bangkok Bank reveal bank finance That the main challenge for overseas businesses in 2568 is geopolitics, which is an important issue to keep an eye on. Because it is not just the trade war between China and the United States, but we will see that there is also the Russia-Ukraine crisis, as well as problems in the Middle East. Geopolitical conflicts are still a risk that can occur at any time and are a fragile issue that must be watched.
However, ASEAN is expected to become the world's fourth largest economy by 4, making it a region of interest for investors around the world, including Thai investors who want to invest abroad.
Regionalization & Urbanization
2 Main themes of foreign affairs
In terms of its international business strategy, the Bank will focus on two main themes: first story คือ Economic connectivity among countries in the region (Regionalization) Geopolitical issues and trade wars have changed the way the world is globalized, which has been clearly seen during COVID-19. The picture of the global trade chain has changed.
Charoenlap said that today, each country's trading partners have started to have China +1 in the supply chain, which has led to more regional investment. Everyone wants to be involved with ASEAN. There is more investment in ASEAN, which is both investment for trade in ASEAN and exports to the United States.
“Our regionalization strategy is led by Supply Chain Relocation to avoid a trade war. Now everyone is starting to realize that they can’t focus solely on China. There are high growth opportunities for ASEAN, and ASEAN is aiming to become the world’s fourth largest economy by 2573.”
Second theme คือ Urbanization If we delve deeper into ASEAN, we will find that ASEAN countries such as Indonesia, the Philippines, Vietnam, and Malaysia, these countries have population growth and economic expansion, which will cause people in each country to move to cities. And in some countries, it may not only be the capital city but also major cities.
“Urbanization is another strategy that we see as creating business opportunities for customers because it will lead to investment in infrastructure projects such as roads, energy, and housing to support the expansion of the urban population and increase spending because when people move to a big city, they have to upgrade their consumption. The FMCG business will have a lot of opportunities.”
However, growth in Indonesia, the Philippines, Vietnam and Malaysia will benefit the bank's international business, with the hope of increasing lending and transaction volumes related to these countries, as well as higher volumes of financial transactions such as remittances.
Charoenlap also said that for businesses in Indonesia, with Bangkok Bank having Permata Bank, the bank’s potential to take care of customers is much higher because Permata is a local bank with a strong capital base, a strong network, and a large customer base. This helps the bank serve more customers, enabling it to find partners both in Indonesia and in the network, which helps it to expand more than before.
In the Philippines, the bank has expectations because of the economic growth and the expanding population, but there is no need to expand branches because there are already branches in Manila and there are customers who continue to invest. Urbanization has allowed the consumer goods business in the Philippines to grow well, and there are also many opportunities in the tourism and energy sectors.
“The current network of banks is sufficient for current business, where the growth of foreign business is quite high because the banking business is in line with the GDP of that country, and ASEAN countries have higher GDP growth than Thailand.”
“China’s” economy awaits recovery
“India” is studying
Charoenlap said that as for businesses in China that seem to be slowing down, the Chinese economy is currently in a transition period and will still need time to manage. Therefore, some groups may see some stagnation, which is in line with the course of change in each country when it reaches a certain point. There will be a step up or a move towards an economy where the manufacturing sector will become more value-creating than before.
What is happening in China now is not new. It has already happened in the Japanese economy, or even further back in the US and European economies. You will see that almost everywhere the manufacturing sector starts in the general category first, but at some point it adjusts itself so that it does not become stagnant and does not grow, such as in the US which started with the production of general electronic products before moving to R&D or software.
A clear example is the aircraft manufacturing industry, which was previously located in the United States, but has begun to be produced in China. The fact that China has produced aircraft industry reflects the high potential of China's manufacturing sector.
“With China’s potential and high domestic purchasing power, China has reached a point where it needs to grow to another level. What China is facing now is that its population is not expanding like before. It is well aware that its population will decrease, its workforce will decrease, but it will have more knowledge. If it wants to move to the next level, it will have to change from High Quantity to High Quality. Once it has passed the transition period, China will return, which may take about 2-3 years or longer.”
While in Myanmar, there may be many obstacles because each country has different domestic conditions, making doing business in Myanmar challenging due to the slowdown of the economy due to lack of investment (FDI), but Myanmar still has domestic consumption. However, overall, the banking business in Myanmar is fine.
As for seeking new opportunities, as seen by the bank sending quite clear signals about the "India" market, which is a country with potential and Bangkok Bank is studying this market, doing business requires customers before investing. Therefore, the bank must study and consider many factors in readiness, including customers and the openness of the banking and financial system in that country. It will not rush into it and will do what it is good at, which Bangkok Bank is good at in the manufacturing sector and the Real Sector group.
“Bangkok Bank has been in each country for a long time and has been with that country in every cycle, whether good or bad, which is the same business value as in Thailand. The bank is 80 years old. The first overseas branch is in Hong Kong, which is 70 years old, which reflects that the bank has never backed down. It has always been there, no matter what the situation is in that country.”
Charoenlap said that in Thailand, there is still interest from foreign investors who want to invest in Thailand, as reflected in the number of investment promotion requests (BOI) that increase every year, coming from both the West and China.
“Bangkok Bank is ready in all aspects to support foreign investors who want to invest in Thailand in all forms, whether it is direct investment or looking for opportunities to acquire businesses if investors are interested.”
However, at present, the competition in the banking business in the region is seen as a competition among the banks in this region, and everyone has local banks in each country. As for the banks from the West, they may not compete directly like in the past because the banks from the West have adjusted their strategies by changing their focus points and not competing like before.
Follow and read other columns in the March 2568 Bank Finance Journal, Issue 515, in digital format: https://goo.gl/U6OnIi
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