Thailand’s Thanachart and TMB unveil merger plans in Thailand’s biggest banking deal for six years.
Thanachart and TBM, the sixth and seventh largest banks in Thailand by assets, aim to close the deal by 2021.
In December 2013, Japan’s MUFJ snapped up a 72% stake in Bank of Ayudhya for $5.3bn.
The Thai government supports consolidation in the banking sector. In particular, it believes that consolidation will strengthen the banking sector and promote Thailand’s financial stability.
“Moreover, this will also help encourage foreign direct investment to promote Thai economy overall. The Ministry of Finance is ready to invest at least THB11bn ($358m) in the merged bank. It could also purchase more shares if existing shareholders do not exercise their rights to subscribe. The Ministry is confident in TMB’s past performance,” says Chumpol Rimsakorn, deputy permanent secretary at Thailand’s Ministry of Finance.
Thanachart TMB merger: new shareholding structure
Netherlands headquartered lender ING will be the largest shareholder after the Thanachart TMB merger with 21.3%. Thanachart Capital will hold 20.4% with the Ministry of Finance holding an 18.4% stake. Meantime,Canada’s Scotiabank will have a stake of 5.6%.
In your opinion, what presents the biggest operational challenge for FS providers in the COVID-19 crisis?
- Switching to large scale homeworking (51%, 162 Votes)
- Retraining the staff (32%, 102 Votes)
- Changing operating hours of branches and call centres (17%, 54 Votes)
Total Voters: 318
The Thanachart TMB merger creates a new lender serving 10 million customers.
Mark Newman, MD ING Challengers and Growth Markets, Asia adds: “ING supports the merger and will invest about THB12.5bn. ING and TCAP have developed a mutual trust through this process. We share the collective goal to achieve substantial growth for the merged bank as a digital leader.”
Suphadej Poonpipat, chairman of the TCAP executive committee adds: “TCAP sees the potential and strengths of both banks. Once combined, the operational scale will double with assets of approximately THB2trn.”
Thailand’s banking top 6 post Thanachart TMB merger
Bangkok Bank is the largest bank by assets in Thailand. It has assets of around THB3trn. Siam Commercial ranks just ahead of third-largest Krung Thai Bank with assets of about $2.8trn. Kasikornbank and Bank of Ayudhya rank fourth and fifth respectively ahead of the new bank created by the Thanachart TMB merger.
Thanachart runs a branch network of around 500 branches. At the same time TMB’s 6 million customers are served by 408 outlets.