Best domestic bank: Siam Commercial Bank
Two lenders stand out above the fray in Thailand: Siam Commercial Bank (SCB) and Kasikornbank. Both are focused, driven, ambitious, and better than their peers at squeezing a little bit extra out of a tough banking market and an underperforming economy.
But Siam Commercial Bank, described by one analyst as the bank “best prepared to benefit from a hoped-for bump in economic growth” in the years ahead, is a worthy winner of this award. Larger than its chief domestic banking rival, in terms of total assets and total market capitalization, it also boasted the highest return on equity of its peers at the end of 2016 – 14.8% – and the highest return on assets – of 1.7%.
SCB reported earnings of Bt47.6 billion ($1.43 billion) in 2016 on the back of a 7.8% year-on-year jump in final-quarter profits. Non-performing loans are also down, falling to 2.67% at the end of 2016 – the lowest ratio in the entire sector – against 2.89% a year ago.
The bank, which had 1,169 domestic branches at the end of March 2017, and offices in eight other countries, including Vietnam, Myanmar and China, has pushed on again this year, reporting net profit of Bt11.9 billion in the first three months of 2017, a year-on-year rise of 13%, again outpacing its peers.
It plans to invest in staff, big data and mobile banking. Last year, the lender doubled the amount of money it set aside for investments in new technology, boosting its IT budget to Bt6.5 billion.
Best corporate and investment bank: Siam Commercial Bank
Thailand can be a tough place in which to operate, but Siam Commercial Bank (SCB) can at times make it look easy, with profits up last year and non-performing loans down. But it’s the lender’s twin beating hearts – corporate banking and investment banking – that really pump the blood around the body.
When it comes to corporate banking, SCB is ahead of the pack: innovative, aggressive, and willing to put its money to work to help valued clientele.
Scroll through a list of recent big debt and equity transactions, and the bank is usually well represented. It topped the ECM league tables in the 12 months to the end of May 2017, with a market share of nearly one fifth, putting it streets ahead of CIMB and Tisco. It continued to rule the roost in the mergers and acquisitions world, outpacing CIMB and Phatra Securities.
Important capital markets deals over the last year include the $174 million initial public offering for Bangkok-based WH Utilities and Power, which was completed in April 2017 and led by Siam Commercial Bank and CLSA.
Two more stand-out deals expected in late 2017 or early 2018 involve a long-awaited $500 million initial stock sale by independent power producer Gulf Group, and a $180.5 million debt refinancing by Laos-based hydroelectric concern Nam Ngum 2 Power.
Both transactions will be co-led by Siam Commercial Bank.
Best international bank: Credit Suisse
Credit Suisse’s commitment to southeast Asia’s second-largest economy is undoubted. The Swiss firm’s plans to focus on the ultra- and super-high net-worth sectors and to mesh its private banking operations with its broader business are bearing fruit.
By any conceivable metric, the decision has paid off. Business is booming, and the bank’s overall operations have benefited accordingly.
But Credit Suisse also has one of the best corporate and investment banking outfits in Thailand, as well as one of its largest and strongest rosters. As one of the few bulge-bracket investment banks with a fully licensed local broking operation, it boasts more than 40 staff, spanning equity sales, research, wealth management, and investment banking, overseen by country director Chris Prasertsintanah.
A quick look at its recent deal list underlines its strength in depth. Take Banpu Power’s $384 million initial public offering, completed in October 2016. This marked the largest domestic equity sale of the year, a deal that priced at the top of the range despite market volatility, and which thanks to strong international demand was fully subscribed on day two of the book-build.
In another stand-out deal last year, Credit Suisse advised France’s Groupe Casino on its strategic sale of a 58.6% stake in supermarket chain Big C Supercenter to tycoon Charoen Sirivadhanabhakdi for $3.46 billion. It was the largest local M&A deal of 2016 and the second-largest cross-border Thai M&A deal ever completed.
Last but not least, it is the runaway leader in block trades, equity and equity-linked transactions, and has been the dominant house for equity offerings for each of the last four years.
Best bank for SMEs: Bangkok Bank
Bangkok Bank is a stalwart of Thailand’s banking community, renowned for being ultra-loyal to its customers, who have a happy tendency to return the favour.
The bank sprawls across the financial spectrum under chief executive Chartsiri Sophonpanich, boasting one of the largest domestic banking networks, as well as offices in 12 Asian nations, including Singapore, Vietnam, Indonesia and Malaysia, and the US and the UK.
But when it comes to banking the nation’s smaller companies, it really shines. When asked to pinpoint the best Thai bank focused on small and medium-sized enterprises, experts point to this lender, with its headquarters on Bangkok’s Silom Road. “It’s the best in that sector, bar none,” says a banker at a rival financial institution.
Analysts concur. One of the ways it stands out from the crowd is with its sheer range of lending services, and its ‘loans for any business’ pledge is no conceit. Bualuang Ventures, a wholly owned venture capital subsidiary, specializes in extending capital to SMEs and start-up firms with a good growth potential. The Bualuang Tan Jai Loan service extends credit lines of up to Bt10 million ($300,000) to small businesses seeking working capital.
Bualuang also specializes in green loans of up to Bt1 million for projects that aim to cut energy usage. And it has separate lending and banking plans for aspiring entrepreneurs who want to own a franchise, or to launch or fund SMEs with a combined asset value of less than Bt5 million. An accelerator programme called InnoHub, set up in June 2017, aims to provide financial support for the country’s best digital innovators.
Best bank for CSR: Bank of Ayudhya
Few Thai lenders – indeed, few regional financial institutions – can claim to have given as much back to the community over the years as Bank of Ayudhya. Since its formation 68 years ago, and long before the concept was given a name and an acronym, Bank of Ayudhya has remained resolutely committed to corporate social responsibility (CSR).
Sometimes that means donating directly to public and private charities that focus on education, culture and the arts, young people and humanitarian activities. Or it can mean forming its own charitable interests, most notably Earth Care, an NGO founded by the bank in 2013 with the aim of cutting pollution, improving the environment and slashing energy use.
Its CSR pillars, which include providing financial support, creating sustainability value and giving back to the community, bleed into everything the bank does, informing its Sustainable Development Goals 2030 programme, an overarching plan that tackles the most complex issues of them all, including combating climate change, strengthening social institutions, and eradicating poverty.
Perhaps the most noble of all of its ambitions involves the lender’s hope of bringing financial literacy to the poorer reaches of southeast Asia, including remote regions of Thailand and Laos. In 2016 alone, Bank of Ayudhya provided financial literacy lessons to more than 5,000 students attending 94 schools scattered across 27 provinces in those two countries.
It has won prizes galore from across the spectrum of finance and society for its efforts to make Thailand – and the wider region – a fairer and more equal place, and it richly deserves this award.
Best digital bank: Bank of Ayudhya
Bank of Ayudhya is not the largest bank in Thailand, but it’s by far the most nimble, and the lender that has invested heavily in its digital platform.
Commonly known as Krungsri in Thailand – a word that roughly translates as great capital – the bank has steadily built up its online presence in recent years, establishing itself as the best in its field. Krungsri Online, with its easy-to-use navigation and soothing yellow-and-black branding, is a stripped-down online banking tool that lets customers see every aspect of their finances in one screen, and on pretty much any device, and allows users to transfer unlimited funds between accounts 24 hours a day.
A new mobile application, set to start in the third quarter of 2017, aims to bring as many services as possible to a mobile device, allowing users to apply for loans and to transfer and withdraw cash. Bank of Ayudhya describes its ongoing digital project, with its simple branded message of ‘Life made simple’ as a vital piece of the jigsaw as it aims to complete its omni-channel strategy.
The Bangkok-based lender will continue to introduce new online and app-based features, including services geared toward mass-affluent and higher net-worth individuals.
Best private bank: Phatra Securities
A worthy winner of the award this year is Phatra Securities, part of Kiatnakin Phatra Financial Group, and a long-standing partner of Bank of America Merrill Lynch. A full-service investment bank, with more than 30 years of history, Phatra offers a wide range of wealth management services to high net-worth clients with investable assets of more than Bt30 million ($900,000), from stocks and derivatives to mutual funds and structured products.Clients either choose to control their investment decisions or allow their portfolio to be managed by a dedicated relationship manager. PhatraDirect meanwhile is a nod to the digital age, a new online service that lets customers access market research, a tailored business newsfeed, a daily newsletter containing the main financial events, and market wraps and highlights, all on a single platform. This is a high-end private banking service for high-end clients.