Siam Commercial Bank (SCB) aims to become a major digital platform service provider under its planned new parent, SCB X, as well as a regional financial tech conglomerate by 2025, with a goal of 200 million customers.
"By 2025, SCB hopes to create significant corporate value from new businesses beyond the fundamental profit and stability of its core banking business," said SCB chief executive Arthid Nanthawithaya. "This includes building a customer base reaching 200 million, expanding new businesses in foreign countries, and owning a large technology platform with a considerable number of users."
The bank plans to achieve these goals through a major group restructuring. SCB's board of directors meeting on Wednesday approved the revamp, a shareholding restructuring and a share swap plan, as well as the establishment of SCB X Plc, which is to play the role of "mothership" for SCB Financial Group, he said.
Under the share swap plan, SCB X will make a tender offer for all SCB shares to the bank's shareholders. After the transaction is completed, SCB X plans to list its shares on the Stock Exchange of Thailand (SET) in the place of shares of SCB, which will be delisted from the bourse.
SCB, the country's fourth largest bank by total assets, also plans to spin off business units and set up new digital arms under SCB X, which is also expected to operate as the group's investment company.
Mr Arthid said despite lacking a financial business licence, SCB X will be supervised by the Bank of Thailand. The central bank has approved the new business structure in principle, he said.
SCB is awaiting approval of the new business structure from regulators and shareholders. The bank scheduled an extraordinary general meeting of shareholders for November.
Mr Arthid said under SCB X, there will be two main financial business groups: banking operated by SCB and new growth businesses.
While the banking business will continue to offer traditional services, SCB wants to focus on blue ocean areas, he said. Digital platform businesses under the bank's subsidiaries and planned spin-offs fall under the new growth business group.
Mr Arthid said the bank plans to spin off some subsidiaries and business units, with around 15 entities to be under SCB X and more entities in the pipeline.
The group aims to achieve its restructuring goals by 2025 with the total customer base, both local and international customers, rising to 200 million from 16 million now. At that time, SCB X's earnings are expected to increase by 1.5-2 times, and the company's market capitalisation would increase to 1 trillion baht, he said.
Partnership is a key strategy to grow SCB Financial Group, said Mr Arthid.
SCB announced three partnership deals this week. One is with Advanced Info Service Plc to set up a 50:50 joint venture, AISCB, with registered capital of 600 million baht to provide digital lending via an online platform.
Another sees SCB and Charoen Pokphand Group jointly set up the US$600-$800 million Global Disruptive Technology Venture Capital Fund, focusing on investments in the areas of blockchain, digital assets, fintech and other emerging technology innovation.
The final collaboration is the incorporation of a new joint venture called Alpha X Co with Millennium Group Corporation (Asia), a leading automotive dealer in Thailand. The venture offers hire-purchase, leasing and refinancing for cars, motorcycles (big bikes) and watercraft (yachts and river boats).
Shares of SCB closed on the SET on Thursday at 130 baht, up 18.7%, in trade worth 21.2 billion baht.