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SCMP Reporter

Thai foray will be part of mainland giant's overseas push

Industrial and Commercial Bank of China is among interested buyers seeking a stake in Thailand's ACL Bank as the mainland's largest lender puts its best foot forward in its effort to expand overseas.

An official with Thailand's finance ministry said the Chinese bank and Malaysia's CIMB Investment Bank were interested in buying stakes of ACL from Bangkok Bank, according to Reuters.

Bualuang Securities, the deal's adviser, has informed the finance ministry of the interest from the mainland and Malaysian banks, the unidentified official was quoted as saying.

The adviser was expected to discuss with finance minister Chalongpob Sussangkarn  the shares sale late yesterday.

Bangkok Bank planned to sell its 19.26 per cent stake in ACL Bank by the end of the year to comply with central bank regulations barring local banks from holding more than 10 per cent in another lender.

The Thai finance ministry, which owns a majority 30.6 per cent of ACL, would have to review the purchases if ICBC and CIMB were to take more than 5 per cent each in the lender, according to the unidentified official.

In Thailand, a foreign investor is allowed to buy a maximum 5 per cent stake in a bank.

An official with ICBC's corporate communication department declined to comment yesterday.

'We haven't been informed on the deal yet,' he told the South China Morning Post.

The potential deal is revealed just one week after ICBC chairman Jiang Jianqing said his bank would take an aggressive approach on acquisitions in emerging markets.

During the World Economic Forum in Dalian last week, Mr Jiang said ICBC was keen to make acquisitions in overseas markets, taking advantage of a recent share price decline triggered by the United States subprime loan meltdown.

'As China's economic power rises, it isn't a surprise to see more overseas acquisitions,' said Zhou Dunren, an economist with Fudan University.

'Mainland banks are now more active in global markets as they seek to increase income.'

ICBC, which raised US$21.9 billion on the Shanghai and Hong Kong stock exchanges in a dual listing last year, was looking to plough back its proceeds in emerging markets.

It embarked on its first foreign acquisition in December last year when it agreed to buy 90 per cent of Bank Halim Indonesia.

Last month, the lender agreed to pay HK$4.55 billion for a 79.93 per cent share of Seng Heng Bank, Macau's third-largest lender controlled by  Stanley Ho Hung-sun.

ICBC president Yang Kaisheng said  this month that the  bank also planned to open a branch in the United Arab Emirates as it secured a foothold in the Middle East.

ICBC posted a 61 per cent year-on-year jump in first-half profit, earning  41 billion yuan  for the six months ended June, benefiting from  loan increases amid a buoyant economy.



ICBC and Malaysian lender mull stakes in ACL Bank