CIMB Thai restructures strategy for its branches

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CIMB Thai restructures strategy for its branches

SUCHEERA PINIJPARAKARN
THE NATION

BANGKOK: CIMB THAI Bank considers its ideal number of branches to be in the range of 80 to 100, now that the Bank of Thailand has allowed the bank to use AIS (Advanced Info Service) shops as a channel to service depositors, while existing branches will focus more on wealthy customers instead.

The bank is adjusting the scale of its branches in line with this strategy and the digital trend, with traditional branches being the channel for its wealthier - or 'preferred' - customers, while mass-market clients can use either the online channel or the partner channel, said Adisorn Sermchaiwong, senior executive vice president of CIMB Thai.

Three years ago, the bank had 160 branches, but the number has since fallen to 110.

"We intend to reduce the number of branches [further] to match our main [mass-market] customers, who rarely visit a branch to ask for financial advice," he said.

Preferred customers are those with assets under management of at least B1 million, and the bank targets increasing their number to 100,000 in 2018, from 40,000 currently.

Previously, CIMB Thai was partnering with AIS to offer transactional banking under its Beat Banking service through the mobile-phone operator's network of shops.

It then sought permission from the Bank of Thailand to use the AIS channel for receiving deposits, as well.

Now that it has been given the nod to do so by the central bank, CIMB Thai has become the first bank in the Kingdom to receive deposits from outside its branch network.

In the initial stage, customers can open a deposit account via 22 AIS outlets, which can issue debit cards to those making a Beat Savings deposit and wanting to withdraw cash from ATMs.

Customers can also conduct any transactions via Beat Banking, Adisorn explained.

The bank plans to expand its Beat Savings operations to 200 AIS shops around the country next year, which it hopes will enable it to attract around 100,000 new customers by the year's end, he said.

In the first stage, it will service savings deposits via the channel, before expanding to fixed deposits, mutual funds and personal loans.

However, the executive said it would first need to discuss the planning and timing of these additional services with AIS, as the bank would have to dispatch staff to AIS shops in order to help train them in the business of servicing financial products.

For Adisorn, the number of 'touch points' was not being reduced as a result of the bank's strategy shift, as it was merely a case of the touch point for general customers now being offered on other platforms.

He said 7-eleven convenience stores would be another touch point for the bank in terms of accommodating mass-market customers. It expects to announce a partnership with the chain in the next two to three months.

The bank next year will also actively promote its credit card to first-jobbers, and to white-collar workers whose lifestyle often entails overseas travel.

It targets the issuance of 30,000 new credit cards next year, bringing the total to around 60,000.

CIMB Thai launched its credit card this year, highlighting its use for travellers by offering a 1-per-cent foreign-exchange fee, well below the 2.5 per cent charged in the market.

The bank has issued 20,700 of the cards so far, with total spending on them coming it at about Bt1 billion.

Adisorn said the number of cards issued was lower than the bank's target because it had changed its plan to strongly promote the credit card to new customers - including first-jobbers - this year, during a period of continued economic uncertainty.

However, despite the currently low number of credit-card customers, it had found that CIMB Thai card spending overseas had grown 14 per cent, compared to 7 per cent by other banks' credit cardholders, Adisorn said.

Moreover, the average spending per card of the bank's preferred customers has reached Bt45,000, much higher than that of its mass-segment cardholders, he said.

Source: http://www.nationmultimedia.com/business/CIMB-Thai-restructures-strategy-for-its-branches-30275253.html

-- The Nation 2015-12-19