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SCMP Reporter

THE continuing expansion of Malaysia's Public Bank Berhad is creating a strategic network of banking and investment services right across Southeast Asia.

  Founded in 1966, Public Bank has had a presence in Hongkong since 1985, but only upgraded to Restricted Licence Bank branch status in 1990.

  Mr Lai Kim Leong, chief executive officer (Hongkong Region), said that Public Bank's primary role in Hongkong was as a trade financier.

  ''Our job, and this is obviously an ideal place to operate from, is to fund international investors seeking to enter the Chinese market,'' he said.

  ''Most of those we cater for are Malaysian or Singaporean companies using Hongkong as the gateway, but, in the future, we also hope to gain referral business heading in the opposite direction.''   From 1992, Public Bank has sought to establish a powerful international presence and this has led to the establishment of overseas investments in Sri Lanka, Vietnam and Cambodia.

  These three countries were selected for their potential for strong industrial and economic growth.

  The Sri Lankan operation opened in Colombo on March 30 last year, becoming the bank's second overseas branch, after Hongkong.

  VID Public Bank, an equal equity joint venture with Vietnam's Bank for Investment and Development, started operations in Hanoi in May.

  A second branch is planned for Ho Chi Minh City this year.

  The objective is to capture a significant share of new banking from local enterprises and from the growing influx of Malaysian and Singaporean entrepreneurs.

  Chairman Mr Tan Sri Thong Yaw Hong defended the Vietnam play at the bank's recent annual general meeting in Kuala Lumpur.

  ''When we ventured into Vietnam, we were the first, and many sceptics asked 'why that country?' Now, most banks know it's a country with a frontier and good potential growth,'' he said.

  The Cambodian Public Bank Limited (CAMPU Bank) also opened its doors in May.

  This, too, is a joint venture operation, but Public Bank's share of the Phnom Penh set-up is 90 per cent.

  Last November, CAMPU launched Cambodia's first ever credit card.

  Mr Leong said he wanted the bank to help extend the range of international investment opportunities in the region as a whole.

  The side of Public Bank better known to Hongkong residents is JCG Finance, the deposit-taking and credit-card company aimed at domestic consumer banking.

  The bank bought JCG in January, 1990, for M$60 million (about HK$180 million) in a deal some analysts considered misguided.

  Mr Lai Kim Leong rejected the criticism.

  ''With JCG, we broke even in the first nine months and reached profitability inside a year,'' he said.

  ''Net after-tax profits jumped 42 per cent and then by 52 per cent again, last year, to a total of HK$96 million.''   The bank has sold off 35 per cent of JCG, but still holds the remainder, and aims to continue expanding the number of branches in the Hongkong network from the present level of 32.



Bank expands across region