Switzerland’s Julius Baer is forming a joint venture with Siam Commercial Bank (SCB), the latest foreign bank looking to tap Thailand’s growing wealth.
Julius Baer will initially hold 40% of the joint venture’s initial registered capital of 1.8bn baht ($58mn) while SCB, Thailand’s second-largest bank by assets, will own 60%, the two firms said yesterday.
Thailand’s wealth market is estimated at around $300bn, with a rapidly growing population of about 30,000 high net worth individuals, the BCG Global Wealth Report 2017 said.
The Thai wealth management industry is still in its “nascent stages,” SCB chairman Vichit Suraphongchai told reporters.
SCB, which serves 13mn clients with $23bn assets under management (AUM), hopes that the new joint venture will help double the size of its private banking AUM in the next 3-5 years, its CEO Arthid Nanthawithaya said in a statement.
Thailand’s growing economy and rising wealth have lured some global private banks to set up an onshore presence, with Credit Suisse launching wealth management in Thailand in 2016.
SCB was also interested in bringing wealth management services to Cambodia, Laos, Myanmar and Vietnam, Nanthawithaya said, while the venture was in line with the Swiss bank’s strategy of expanding footprint in Asia, where it was surveying markets, Julius Baer CEO Bernhard Hodler said in an interview.
Hodler, who took over as CEO last November, said this could be through M&A, hiring a team or a joint venture.
Another Swiss private bank, Lombard Odier, is a partner of Thailand’s third-ranked bank, Kasikorn Bank Pcl, while regional rivals like Malaysia-based CIMB and Singapore’s United Overseas Bank also have wealth management units in Thailand.
The Julius Baer-SCB venture will operate via companies in Thailand and Singapore.
The Swiss private bank will have the option to increase its stake to 49% over time, the banks said in the statement.
Siam Commercial Bank, which serves 13mn clients with $23bn assets under management, hopes that the joint venture with Switzerland’s Julius Baer will help double the size of its private banking asset under management in the next 3-5 years, its CEO said.
