UOB (Thai) readies for AEC lending rush

Thailand well situated for growth, bank says

Thailand remains on the radar for loan expansion in the small and medium-sized enterprise (SME) segment because of the expected rise in trade volume from the coming integrated Asean market, says United Overseas Bank (Thai).

The bank continues to shoot for double-digit growth in SME loans, with the fast-approaching Asean Economic Community (AEC) set to boost intra-regional trade, said Sayumrat Maranate, country head for business banking and executive director at UOB (Thai).

Thailand’s geographical location will serve the country well as a platform for business loan expansion.

Mrs Sayumrat declined to provide a target figure for loan growth in the coming periods, saying only that SME lending accounts for 15% of the bank’s loan portfolio.

“SME loan growth is expected to expand by two or three times [Thailand’s] gross domestic product,” she said, noting that the bank forecasts GDP growth of 3.5% in 2016.

UOB (Thai) has set up 26 SME banking centres across Thailand, 14 of which are in provincial areas where growing crossborder trade has fuelled economic growth.

These centres provide full-scale banking services for SMEs, ranging from working capital loans and cash management to trade financing and deposit services.

These centres offer a one-stop service to help SMEs with their financial needs, Mrs Sayumrat said.

Increasing economic value in terms of gross provincial product will also support a stepped-up expansion in SME loans, she said.

UOB (Thai) provides credit lines of up to 40 million baht for SMEs whose turnover does not exceed 400 million baht. The bank’s SME customer base numbers roughly 40,000.

Of the bank’s total SME lending, 60% is to companies in Bangkok and 40% is to those in big provinces.

At a time of sluggish economic conditions, UOB (Thai) continues to provide loans to quality SMEs associated with the services sector, such as hotels and restaurants, and companies involved with apparel production.