Siam Commercial Bank (SCB), the country's third-largest lender to small and medium-sized enterprises (SMEs), is set to knock Kasikornbank off its perch as the leader in this segment in a few years.
SCB senior executive vice-president Arthid Nanthawithaya says the bank will focus on asset quality to control gross NPLs at 2.1-2.3% of total loans outstanding.
The bank is aiming for double-digit SME loan growth of 10-15% this year from loans outstanding of 350 billion baht at the end of last year, said Yol Phokasub, SCB senior executive vice-president.
"We have developed our corporate and retail banking businesses to become the market leaders, and SME business will be the bank's next step. We will focus on being No.1 in profitability and market share rather than loan portfolio size," he said.
KBank's SME loans outstanding tallied 600 billion baht in 2014, making it the market leader.
SCB's double-digit growth target for SME loans is based on plenty of room for growth from small SMEs, he said, adding the bank's new business model and small base make the growth goal attainable.
Small SMEs with a credit line of 10-30 million baht are SCB's main focus. The bank's 1,280 branches across the country have been developed to support SME customers.
Larger and medium-sized SME businesses make up the largest portion of SCB's SME loans outstanding, but he did not provide a figure.
SCB set a credit line for larger and medium-sized SME debtors at over 100 million baht and 31-100 million, respectively.
Arthid Nanthawithaya, another senior executive vice-president, said the bank set a single-digit growth goal for wholesale, retail loans and total loans this year.
SCB, the country's third-largest commercial bank by assets, targets total loan growth for 2015 of 6-7%, in line with banking industry growth of 5-7%. Retail loans represent 44% of the total portfolio, followed by corporate banking business at 37%, and SME loans at 19%.
The bank will focus on asset quality to control gross non-performing loans (NPLs) at 2.1-2.3% of total loans outstanding. Last year the bank's gross NPLs reached 42.74 billion baht, 2.11% of total credit. SCB's total loan growth in 2014 was 2.4% to 1.78 trillion baht.
SCB shares closed on the SET yesterday at 187 baht, up one baht, in trade of 980 million baht.