LH Bank will offer partner big stake

LH Bank will offer partner big stake

Land and Houses Bank (LH Bank) is poised to offer a significant stake to a potential strategic partner through capital-increase shares.

The partner can take the sizeable stake in either LH Bank or parent LH Financial Group Plc, said Anant Asavabhokhin, the major shareholder in Land and Houses Plc (L&H).

Anant: E-banking expertise needed

L&H, the country's leading property developer, owns a 34.1% stake in LH Financial Group, while sister developer Quality Houses Plc owns another 21.4%, according to Stock Exchange of Thailand (SET) data. 

LH Financial Group had paid-up capital of 13.2 billion baht and market capitalisation of 28 billion as of Tuesday.

LH Bank has been in talks with several potential investors. Local media recently reported that CP All Plc, the 7-Eleven convenience store operator, was among them, as it wanted a banking licence to expand into microcredit through its extensive store network.

Dhanin Chearavanont, Thailand's richest man and chairman of Charoen Pokphand Group, confirmed his company was interested in buying LH Bank but said a deal was not yet settled.

With limited banking licences and the approach of the Asean Economic Community, Thailand has caught foreign financial institutions' interest as a base to serve their customers' expansion into the single market.

Mitsubishi UFJ Financial Group, Japan's largest lender by assets, last year acquired a 72% stake in Bank of Ayudhya, Thailand's fifth-largest bank, in a deal worth 177 billion baht.

Mr Anant said the amount of LH Bank's recapitalisation had not been decided and depended on the potential partner's requirements and negotiations.

"I don't mind how much of our stake will be left," he said. "The bank wants a strategic partner with expertise in e-banking, in line with the trend."

LH Bank, founded in 2005, focuses on mortgages, which contribute 30.4 billion baht or 27.6% of its overall loan portfolio.

It hopes to see its assets expand to 164 billion baht this year, up by 10% from last year, with 15% growth next year.

LH Financial Group (LHBANK) shares closed yesterday on the SET at 2.08 baht, down four satang, in trade worth 506 million baht.

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