South Korea’s Financial Supervisory Service and the Korea Federation of Banks on Tuesday co-hosted a seminar to encourage South Korean financial institutions to advance into Thailand, a move in line with the Moon Jae-in administration’s New Southern Policy that aims to boost Korea-ASEAN economic ties.
The Korean financial authorities invited representatives of the Bank of Thailand, the nation’s central bank and financial watchdog, to the KFB headquarters in Seoul to meet with Korean representatives from four commercial banks, two state-led banks, four credit card companies and five loan providers.
The delegates from BOT were Raviwan Sirikasemsap, director of the financial institution business supervision department, and Anyarat Kongprajya, assistant director of the financial institutions strategy department. The officials briefed attendees on the Thai financial industry landscape and license regulations for foreign companies.
This is the first in a series of seminars to promote business entry into ASEAN member economies, including Thailand and Malaysia, according to the FSS.
An aerial view of Bangkok, Thailand (EPA-Yonhap)
As of end-June, three financial companies have set foot in Thailand. KTB Investment & Securities and Samsung Life Insurance operate subsidiaries in Thailand, while the state-led KDB runs an office there.
Thailand is the second-largest economy among ASEAN countries, but its openness to foreign financial institutions has been limited since the global financial crisis in 1997, according to the FSS.
In contrast to the lack of Korean presence, Japan has been on track to enter the Thai market. One example in the financial industry is Tokyo-based MUFG Bank’s 2015 acquisition of a controlling stake from Krungsri, the fifth-largest Thai universal bank. The banking arm of Mitsubishi UFJ Financial Group owns 76.88 percent of the Thai bank, also known as the Bank of Ayudhya, as of September.
Given the circumstances, those intent on starting or expanding business in Thailand should come up with a groundbreaking approach, Lee Bum-yoal, director of the FSS’ Financial Hub Korea, told The Korea Herald.
An example would be a scheme through which Korean companies envision a new microfinance business in Thai remote areas that lack infrastructure, he said.
“The priority of Korean financial companies can go to the underprivileged in Thai remote areas, so that they can contribute to overall growth of the Thai economy,” Lee said.
By Son Ji-hyoung