KBank expands its reach within AEC+3 region
Setting its sights on becoming A Regional Bank of Choice, KASIKORNBANK (KBank) is determined to penetrate the AEC+3 market, focusing primarily on China, Vietnam, Indonesia, Cambodia and Lao PDR.
The Bank has advanced its strategic directions via its digital banking solutions in order to empower every customer’s life and business, while contributing to regional economic growth. KBank aims to increase its international business income to net income to 4 percent as it aspires to be among the top 20 banks in Vietnam and Indonesia within 2027.
Mr. Pattarapong Kanhasuwan, KBank Executive Vice President, said, “Over the past year, KBank expanded our international business in earnest as evidenced by our rapid growth amid numerous challenges as the global economy began to emerge from the doldrums. In 2022, the Bank’s net total income rose to 2.5 percent. Meanwhile, the number of local customers across the region now totals 2.1 million.”
For 2023, the Bank will continue to expand its reach within the AEC+3 marketas it aims to become A Regional Bank of Choice. KBank’s regional operations are governed by three key strategies, including 1) Aggressive Play: aggressive expansion in corporate lending; 2) Mass Acquisition Play: expansion of the customer base through digital channels in collaboration with the Bank’s partners, with the ultimate goal of becoming a regional payment platform; and 3) Disruptive Play: development of new products to serve customers with limited access to bank services (the underbanked), a substantial customer base in this region. Specifically, these new products are digital lending with alternative data.
At the same time, KBank prioritizes strengthening its foundation for enhanced efficiency and effectiveness in business operations within AEC+3. In order to make its presence felt across the region while also promoting its trustworthy brand, KBank has broadened its infrastructure and IT personnel in order to develop digital products and services in alignment with market demand for the customers’ optimum benefit. The Bank has also fostered partnerships with local financial service providers, reinforcing its determination in creating an ecosystem that promotes financial inclusion to ensure that customers can gain improved access to funding sources for the betterment of their quality of life and their businesses. These endeavors are instrumental in differentiating KBank from its peers as it strives to be a regional bank that goes beyond banking.
Mr. Chat Luangarpa, KBank Executive Vice President, said, “In alignment with KBank’s growth target and strategy for 2023, which presents ample opportunity for growth within ASEAN, KBank is setting its sights on becoming A Regional Bank of Choice within AEC+3, with focus on expanding businesses in China, Vietnam, Indonesia, Cambodia and Lao PDR through digital banking and beyond banking solutions. This will be achieved by enhancing its technological capabilities and collaboration with partners for service development to improve the quality of life of customers in the region while helping advance the regional economy.” KBank has mapped out its business operational guidelines and key growth targets in strategic countries, as follows:
KBank continues to focus on China and the AEC. In China, KBank, as a locally incorporated institution, aims to deliver the value proposition for its customers through the “Better Me and Better SMEs” concept by helping local customers gain easier access to loans so that they have the opportunity to improve their livelihood and business. For customers in the AEC, including Lao PDR, Cambodia, Vietnam and Indonesia, KBank will focus on developing digital financial products and services that meet their diverse needs. Greater convenience will be offered to retail customers so that they can gain easier access to banking services. To support business customers in the AEC+3, KBank will strengthen AEC connectivity to create a cross-border value chain that will assist customers in growing their business opportunities.
For Vietnam, which is one of KBank’s strategic countries, given its impressive and fastest economic growth in 25 years at 8.02 percent, KBank has launched digital lifestyle solutions via K PLUS Vietnam, which attracted up to 400,000 users from March 2021 to February 2022. Additionally, KBank has formed partnerships with more local partners via KVision’s investment in rising-star startups in numerous businesses such as Seedcom, Vietnam’s leading retailer, with the aim of expanding financial services, and Selly, a social commerce platform service provider. KBank will also press ahead with its development to become a full-fledged financial service provider in the transactional ecosystem, covering all customer segments in Vietnam, including corporate, medium-size and retail customers. KBank aims to attract 1.3 million retail customers in 2023 and become a top 20 bank by asset size in Vietnam within 2027.
Indonesia is another high-potential market with its population of 270 million – the most populous economy in ASEAN and the world’s fourth-largest.. KBank therefore aims to advance its business operations in Indonesia. At the end of 2022, the Bank had increased its total shareholding in Bank Maspion to 67.5 percent, leading KBank to become the controlling shareholder of Bank Maspion. Further to this accomplishment, KBank will prioritize transformation with the use of its long-term experience and leadership in digital banking services, together with Bank Maspion’s local banking expertise. The focus is to drive Bank Maspion to become the largest bank in East Java in order to accommodate Indonesia’s long-term economic growth. In doing so, Bank Maspion has pursued multifaceted strategies in three different customer segments, including corporate/large businesses (Corporate), medium-sized businesses (Commercial) and retail customers (Retail), aiming to be among the top 20 banks having the largest loan portfolios in Indonesia by 2027.
Mr. Chat added that KBank has strengthened its digital banking with the adoption of cutting-edge technology and financial innovations of KASIKORN Business Technology Group (KBTG) for the development of financial service offerings in China, Vietnam, Indonesia and other regional countries. The move is meant to reinforce its business strategies that go beyond banking in the AEC+3 region. Additionally, the Bank is determined to improve work processes at its overseas branches to drive the organization under the World of Borderless Growth concept. All working teams will be supported with ample resources and operational models to achieve steady growth amid challenges in the regional economies.
For its 2023 targets, KBank aims to earn revenue from international business at 4 percent of net income (increasing from 2.5 percent in 2022), gearing up to become one of the 20 best banks in Vietnam and Indonesia by 2027.
