Kasikornbank (KBank) plans to maintain its number of brick-and-mortar branches nationwide at 873 and its staffing levels at 19,990 for next year, despite rising digital banking transactions.
Offline services are still necessary to provide customers with a better understanding of debt relief measures amid the pandemic, said KBank co-president Patchara Samalapa. A network relocation plan should see the bank close some branches and open new outlets to increase branch coverage across the country.
Overlapping branches are largely located in urban areas, while the expansion of traditional branches in rural communities is to access new customer segments, he said.
The total number of branches in the commercial banking industry stood at 6,585 as of October, a decline from 6,851 from year-end 2019. KBank had 897 branches in December 2019, according to central bank data.
KBank has spent the past few years restructuring its branch business and reskilling branch staff to offer sophisticated financial services to customers against the backdrop of digital disruption, said Mr Patchara.
As a result of these developments, KBank has yielded benefits in terms of helping customers understand more clearly the financial assistance measures available in the wake of the pandemic, he said.
Some 73% of total customers that applied for KBank’s debt relief measures have been able to repay their debts normally following the expiration of the central bank’s first-phase options on Oct 22.
Patchara: Branches still needed
Of the 73%, 27% are small and medium-sized enterprise (SME) clients. The level of 73% of clients requiring debt servicing is higher than the banking industry’s average of 66%.
The total loan amount under KBank’s financial aid programme, covering both the central bank’s first- and second-phase debt relief scheme, is registered at 853 billion baht, of which 700 billion is attributed to SME and retail loans.
“With services provided by staff members based at physical branches nationwide, this allows us to ensure customers have a better understanding of debt solutions and can ease their financial burden at this difficult time. Human resources and face-to-face services are still required in the digital age,” said Mr Patchara.
Ensuring the public has a better understanding of the 853-billion-baht loan amount under the bank’s debt relief programme is a priority, rather than granting new loans, he said. The debt relief measures should help prevent non-performing loans from exceeding 4% of total outstanding loans, said Mr Patchara.
He said having 73% of customers able to service their debts is better than KBank expected, based on its worst-case scenario for debt repayment during the pandemic.
Despite clients’ improved debt-servicing ability, tourism-related businesses are still struggling and these businesses represent 12% of KBank’s total loan portfolio at 2.1 trillion baht.
Most tourism businesses that are KBank clients remain in the debt relief programme, considered on a case-by-case basis.
KBank is Thailand’s largest commercial bank for digital banking services, with total users of K-Plus, its mobile banking app, standing at 14 million.
Using information-based lending, the bank has expanded unsecured loans worth a total of 20 billion baht this year, up 30% year-on-year.
Both individual and commercial borrowers, covering salaried employees, freelancers and self-employed individuals, are the key targets of the innovative loan product, said Mr Patchara.
Source: bangkok post