Saturday, November 10, 2007

Holland's ING Bank to help grow Thailand's TMB Bank Group

ING pledges to improve TMB

KRISSANA PARNSOONTHORN & NUNTAWUN POLKUAMDEE

After reaching an agreement to acquire a 30% stake in TMB Bank, ING Group plans to help the bank to become a top-five player in retail banking field.

The Dutch financial institution would pay 460 million euros for the share acquisition at TMB, or 1.60 baht per share. ING would acquire 25.1% of the bank's total common shares and another 4.9% in non-voting depository receipts.

TMB will request that the Securities and Exchange Commission grant a waiver to allow ING to perform a tender offer to purchase the remaining shares.

Hans van der Noordaa, a member of the executive board of ING Group, said the group was committed to a long-term investment in TMB over five to 10 years and would bring in expertise to improve the bank.

Discussing ING's strategic plans yesterday, from left: Maris Tarab, managing director of ING Funds (Thailand); Hans van der Noordaa, an executive board member of the ING Group; and Rajesh Sethi, chief executive officer of ING Life Insurance in Thailand. — TAWEECHAI TAWATPAKORN

''It's too early to say in detail how TMB will change its board and business policy. We need to do homework in the coming months and discuss with the other shareholders and the management team about how we can bring in expertise and people,'' he said.

Mr van der Noordaa declined to comment on whether TMB chief executive Subhak Siwaraksa would be replaced.

ING has been active in the insurance, asset management and retail banking businesses in the Asia Pacific for years. Its new footprint in the Thai banking sector is expected to help the group further expand the businesses, which includes insurance, bancassurance and asset management.

Mr van der Noordaa said that TMB, Thailand's sixth largest bank in terms of assets, had significant growth potential. The bank has a solid branch network to help expand the customer base.

''We like to invest in a relatively small financial institution and build it to become a valuable company. We used to invest in Japan and Korea and built up small financial institutes into big players,'' he said.

Apart from banking, the group also sees opportunities in the insurance and asset management businesses here.

Mr van der Noordaa said it was too early to outline the ING Group's policy on the asset management business.

ING Funds (Thailand) is the group's asset management subsidiary while TMB Bank owns TMB Asset Management. Both firms have their own strengths and offer different fund products.''We will study more and work with the local management before outlining any specific policy. Anyway, we will bring in and help develop new products for ING Funds and TMBAM in the future,'' he said.

Maris Tarab, managing director of ING Funds, said its business would benefit from the TMB network. The bank would be able to tap into the bank's depositor base and distribute its products through 472 bank branches.

ING Funds predicted that its assets under management would rise to 204 billion baht next year, up from 184 billion baht by the end of this year. Its assets stand at 181 billion baht.

''With future support from TMB, we will increase our assets 20-30% more than our original projection for 2008,'' he said.

The asset manager would shift to focus on bank depositors next year and tailor its fund products to serve them. ING Funds has a limited distribution network with only foreign banks and some securities companies as its selling agents.

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