KKP aims to woo mass affluent base

SET-listed Kiatnakin Bank (KKP) is keen to expand its base of “mass affluent customers” to aggressively boost their investment portfolios to 100 billion baht in the next few years.

The move is also meant to widen the bank’s fee-based income in the long run.

There is room to increase the number of mass affluent customers because of lower competition in the segment compared with the high end, said president Apinant Klewpatinond.

In Thailand, the mass affluent group includes about 500,000 people.

KKP defines mass affluent clients as those whose investment portfolio is worth between 2 million and 30 million baht.

The bank’s mass affluent portfolio is valued at 15 billion baht at the moment.

KKP has a strong high net worth client base with a combined investment portfolio of 350 billion baht, of which 15 billion is mass affluent customers.

On average, the bank’s wealth management services generate income of 0.5% of assets under management (AUM).

Mr Apinant said one strategy to increase the number of mass affluent clients is to attract the targeted group from its stockbroker arm, Phatra Securities, which does not focus on the group.

The bank’s new model has three branches that focus on financial advisory services rather than banking transactions. This is its key strategy to lure mass affluent customers. Three branches are sufficient to serve the demand of current customers, he said.

KKP will gradually develop human resources, particularly financial consultants, to keep up with wealth customer demand.

Currently it has around 60 financial consultants overseeing the combined 350 billion baht in AUM of the client segment and 10 of them are for the mass affluent group.

In the meantime, the bank has no plan to either open more branches or shutter its existing 65 branches nationwide following the recent branch network restructuring, Mr Apinant said, adding that even though some of them do not make a profit, they serve as the distribution channel for financial products and services and help in enlarging the customer base.

KKP shares closed yesterday on the Stock Exchange of Thailand at 51.25 baht, down 75 satang, in trade worth 197 million.