CIMBT offering derivatives

CIMB Thai Bank (CIMBT) is focusing on high-net-worth customers this year by offering derivatives products, says senior executive vice-president Adisorn Sermchaiwong.

Mr Adisorn said the bank plans to attract the high-net-worth group with higher-return products at a time of low interest rates.

The higher-return, higher-risk products such as structured notes are suitable for clients whose risk appetite is relatively high and who have knowledge about complicated investment products, he said.

The bank has transferred the derivatives products, or structured notes, from its subsidiary, CIMB Thai Securities, which operated the products until earlier this year, mainly due to the limited capital of the subsidiary.

“Instead of raising CIMB Thai Securities’ capital in order to expand its derivatives products, we chose to transfer the products to the bank, which has more than sufficient capital ready for operating the derivatives business,” said senior executive vice-president Sutee Losoponkul.

CIMBT forecasts sales of the derivatives products of 10-12 billion baht this year.

The bank has changed its requirements from a minimum of 1 million baht in assets under management (AUM) to a minimum of 5 million baht for clients to be permitted to invest in the high-risk derivatives products.

The bank has 58,000 preferred customers and aims to expand the roster to 70,000 clients by the end of the year.

There is ample opportunity for new highrisk products in light of low interest rates, which have forced investors to shift their capital towards high-yield investments.

CIMBT ranked second in structured note products in terms of total sales volume in 2016, declining from the top position in 2015.