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Baht/$ 33.92/98 (Bid/Ask)
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13950
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SMALL BUSINESS
SOMRUEDI BANCHONGDUANG
Exporters so far have felt a minimal impact from the turmoil in the US financial markets, according to Pakorn Partanapat, a first senior vice-president at Kasikornbank.
He said his bank's customers have been proactively diversifying their export markets - particularly to China, India and the Middle East - to reduce their exposure to and reliance on US buyers.
For KBank itself, he added, export loans to the US were only a minute portion of the total loan book.
"Thanks to some early strategic adjustments, most exporters I believe will not be affected by the risk [from the US financial crisis]," Mr Pakorn said.
Small- and medium-sized customers were more cushioned from US economic woes than larger companies and multinationals, he said. Most small firms are not direct exporters, but rather suppliers or subcontractors to larger exporters.
"I don't think we will see a direct impact on Thai companies for now. But the country's export growth should slow in 2009," he said.
KBank expects to meet its 20% loan growth target for the small and medium-sized enterprise market this year. By the end of the year, outstanding loans to the segment are projected at 360 billion baht, compared with 320 billion at the end of August.
In addition, the bank's market share for small business loans - already an industry-leading 27% - is forecast to rise to 30% by the end of the year.In the last few months of the year seasonal factors should boost the farm sector's loan demand, Mr Pakorn added.
In light of the turmoil in global financial markets, he said that KBank had tightened its lending standards and risk controls. Loan officers are being more proactive in working with overdue customers to restructure their obligations.
Non-performing small business loans, defined as those past-due over three months, are only 2% of the sector's total outstanding loans, Mr Pakorn said. After provisions, net non-performing loans are only 0.6%.
KBank will launch a new Loan Festival programme running from Oct 1 to Dec 31, offering a three-month grace period for both principal and interest payment for small-business loans.
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