Exclusive: Thailand’s KBank in talks to buy Vietnamese lender worth up to $1 billion – sources
The Kasikorn Bank headquarters is pictured in Bangkok, Thailand, January 5, 2016. REUTERS/Athit Perawongmetha/File Photo acquire license rights
HANOI/SINGAPORE, Aug 22 (Reuters) – Thailand’s second-largest lender Kasikornbank (KBANK.BK) is in talks to buy consumer finance provider Home Credit Vietnam in a deal worth up to $1 billion, which would fuel its expansion efforts in Vietnam. said two sources.
The Bangkok-based lender, also known as KBank, hopes to become one of Vietnam’s top 20 banks by assets by 2027. Its total assets are US$119.7 billion, ranking second only to Bangkok Bank (BBL.BK) in Thailand, Refinitiv data showed.
The news comes at a time when Vietnam’s banks are under pressure as a slowing economy and ongoing turmoil in the property sector have led to a surge in non-performing loans and prompted sweeping rate cuts.
A potential deal would underscore the consolidation trend in Asia’s financial sector, making KBank the second-biggest M&A deal in Vietnam’s financial industry after the sale of a $1.5 billion stake in Vietnam Prosperity Joint Stock Commercial Bank (VPB.HM) to Japan this year, Sumitomo Mitsui (8316.T) do in March, according to Refinitiv data.
According to the two sources, KBank has been in talks with financial advisors to review the potential acquisition, although consultations are ongoing and no final decision has been made.
“KBank currently operates the KBank Biz Loan solution, a lending service for small retail businesses. The potential deal with Home Credit will allow the bank to boost access to financial services for small business customers,” one of the sources familiar with the subject said.
The sources were not named as this is a private matter.
KBank and Home Credit Group did not respond to Reuters requests for comment.
Vietnam, home to more than 100 million people, has a rapidly growing working-age population, with over 69% of the population estimated by KBank to be unbanked, the highest in Asia.
In June, the Thai lender received approval from the Central Bank of Vietnam to increase its core capital for its operations in the country from $80 million to $285 million, becoming its second-largest foreign bank.
The goal was a net income of $400 million, outstanding loans of 180 billion baht ($5.13 billion) and a customer base of 8.4 million in the country by 2027.
Home Credit Vietnam, part of the Netherlands-based non-bank financial institution Home Credit Group, began operations in the Southeast Asian country in 2008 and now has 6,000 employees serving 12 million customers, according to its website.
In addition to cash loans, the company also offers installment loans for the purchase of motorcycles and durable goods. According to its website, the company has 9,000 stores in Vietnam.
Home Credit Group is controlled by the Czech Republic’s largest investment group, PPF, founded by the late billionaire Petr Kellner. In the first half of 2022, the company reported a larger loss, mainly due to the impact of the sale of Russian operations.
($1 = 35,1200 baht)
Reporting by Phuong Nguyen in Hanoi and Yantoultra Ngui in Singapore; Edited by Kane Wu and Devika Syamnath
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