GSB, ICBC forge network deal
State-owned Government Savings Bank (GSB) has signed a memorandum of understanding on a business alliance with ICBC Thai, aiming to expand its local and Chinese clientele.
Under the agreement, GSB can use the network of Industrial and Commercial Bank of China (ICBC), while the world’s largest commercial bank can use GSB’s network, said Chatchai Payuhanaveechai, president and chief executive of the state-backed bank.
ICBC has 500 million customers and 20,000 branches worldwide, while GSB has 22 million and over 1,000 branches in Thailand.
The partnership covers seven products and services: co-branded UnionPay, electronic data capture and point-of-sale (POS) terminals, online product trading and services, syndicated loans, the Eastern Economic Corridor, interbank lending, and banking agents, Mr Chatchai said.
The alliance eases doing business for both nations, he said.
For instance, Chinese tourists and investors can use AliPay, WeChat and UnionPay in Thailand through GSB’s network, while the Thai bank can offer syndicated loans to Chinese investors who embark on infrastructure investment in Thailand.
The collaboration between ICBC and the GSB is expected to start with co-branded credit cards and POS terminal service, Mr Chatchai said.
The Thai bank has credit cards that use Visa and Mastercard networks, but they cannot be used in China, he said.
GSB aims for 100,000 co-branded credit cards under ICBC’s network in the first year of the agreement.
Li Zhigang, chairman of the board at ICBC Thai, said his bank has developed its presence in Thailand over nine years and bridges the trade and economic relationships of both countries.
The collaboration will help both banks expand their customer base, he said.
Separately, Mr Chatchai said GSB’s lending by year-end is expected to increase by 100 billion baht or 4-5% from the end of last year to 2.2 trillion baht, while deposits outstanding are set to rise by 100 billion baht to 2.3 trillion baht.
The bank’s non-performing loan ratio is estimated to fall to 2.8% at the end of this year from 2.9% a year earlier.