Foreigners eye stake in ailing IBank
Several Asian financial houses including some from the Middle East are keen to take a sizeable stake in the financially troubled Islamic Bank of Thailand (IBank).
The State Enterprise Policy Office (Sepo) now lets local or foreign private investors acquire more than a 50% holding in the state-backed bank.
IBank has already talked to some interested parties, chairman Chaiwat Uthaiwan said without elaborating.
Potential partners will become clearer early next year, Mr Chaiwat said, adding that IBank would talk seriously about the share sale after sorting out good and bad assets.
IBank has hired a financial adviser for the sorting process, which is expected to finish within six months.
The Finance Ministry holds a 48.54% stake in IBank, the Government Savings Bank 39.81%, Krungthai Bank 9.83% and other shareholders the rest.
IBank is among seven
financially troubled state enterprises required by the State Enterprises Policy Commission or superboard to undertake business rehabilitation plans.
Mr Chaiwat said the superboard would allow the private sector to acquire more than a 50% stake in the bank — a level that would remove IBank’s state-owned status.
The bank is saddled with bad loans of 57 billion baht out of total credit of 100 billion and has set aside 32 billion for loanloss provision.
IBank plunged to a net loss of 10 billion baht last year.
Mr Chaiwat expects IBank will restructure 20 billion baht in debt this year, with about 10 billion worth of loan-loss provision reverting to capital.
The bank has successfully restructured 10.8 billion baht in troubled loans over the past three months.
Debt restructuring is a major aspect of the bank’s rehabilitation plan, which recently won approval from the superboard.
The plan sorts bad debt into four groups — businesses that still operate and have sufficient cash flow, businesses that can still be turned around, businesses that are operating but finding it difficult to turn the corner and businesses that are unwilling to pursue debt restructuring or have shut down.
IBank is in the second round of a selection process for a new chief executive after evaluating and rejecting three candidates who met the requirements of the first round.
It is seeking a professional with experience in running an international business.