Land and Houses Bank (LH Bank) and its parent LH Financial Group Plc (LHFG) are seeking an outsider to succeed Anant Asavabhokin, who recently resigned as chairman after being issued with a Department of Special Investigation (DSI) summons over alleged money laundering.
The new chairman of the board would be an outsider to both the LHFG and the Anant family, said Rutt Phanijphand, chairman of the executive directors of LHFG.
The bank will submit the name of a designated chairman for final approval to the Bank of Thailand, which is expected to finalise the appointment by August, he said.
Property tycoon Mr Anant last week resigned as chairman of LHFG, LH Bank, Land and Houses Plc (LH) and Home Product Center Plc (HMPRO) after the DSI issued him a summons for alleged money laundering in connection with the Klongchan Credit Union Cooperative embezzlement case. He also gave up his directorships in the companies.
"Mr Anant's case is a personal matter and it won't have any impact on the bank's recapitalisation plan or business operations. Mr Anant indirectly holds a 12% stake in LH Bank," Mr Rutt said.
A share acquisition deal between LHFG and the Taiwan-based CTBC Bank Co Ltd notes the chairman of the board is a position reserved for the Thai company. CTBC will acquire 7.55 billion newly issued shares or 35.6% of LHFG at a price of 2.20 baht per share, valued at 16.6 billion baht (around US$500 million), through private placement.
The funds are expected to be injected into LHFG by July, Mr Rutt said.
After the deal is completed, the Thai and Taiwanese shareholders will hold an equal stake of 35.6% each. LHFG owns a 100% stake in LH Bank, and LH and Quality Houses Plc (QH) own a combined 55.3% in LHFG.
Sasitorn Pongsathorn, the LH Bank president, said proceeds from the recapitalisation would be sufficient to support the bank's business expansion through 2020.
The bank aims for 10-15% growth per year in assets to around 500 billion baht in 2020 from 220 billion expected at the end of this year.
The recapitalisation will strengthen the bank's tier-one capital to 20.1% from 10.4% currently. The banking industry's first-tier capital averages 14.3%.
LH Bank will hold a shareholder meeting on July 12 to consider the tender offer whitewash waiver after the deal wins approval from both the Bank of Thailand and the Taiwanese regulator.
LHBANK shares closed yesterday on the SET at 1.82 baht, up six satang, in trade worth 293 million baht.