Like a middle-aged banker wearing the latest sneakers and baseball cap, fintech makeovers can look a little forced. Previous attempts to turn centuries-old financial institutions into born-again technology companies have often ended in disappointment.
BBVA and ING’s recent sales and closures of international digital-banking businesses are cases in point.
But there is a growing sense, post-Covid, that incumbent financial institutions have no choice other than to try again and fail better, as fintech valuations have mushroomed.
Partly inspired by the growth of digital subsidiaries at Chinese insurance group Ping An, Siam Commercial Bank (SCB) is in the middle of what could be the traditional banking industry’s boldest leap yet in this direction. In November, the 114-year-old lender unveiled a plan to radically reorganize its shareholder structure, to prove just how much it can move beyond its legacy and expand outside Thailand.
SCB’s restructuring will see it delist in favour of a new financial holding company known as SCBX, under which traditional banking and asset gathering will be one of three pillars. A second pillar will house credit cards, auto finance and brokerage. A third pillar will be dedicated to new digital platforms and ventures.
SCB then plans to list the cards business, followed by Ping An-style IPOs of its new tech subsidiaries.
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