"Even though many Chinese banks are looking for foreign strategic partners due to the country's merger and acquisition trends, this area is not our focus," he said.

Thailand's largest bank in terms of assets has four branches in China, located in Beijing, Shanghai, Shantou and Xiamen.

Kosit said the bank would closely monitor China's development, particularly in the financial sector.

All BBL's branches in China have generated good returns

and it is looking forward to set-ting up more branches there, he said. Assets at the Chinese branches account for 12 per cent of BBL's offshore operations.

China plans to liberate its financial sector in December under an agreement with the World Trade Organisation and Kosit believes BBL is ready to cope with the big change through its strong network there.

"With China playing such a significant role in today's global economy, its rapid growth impacts macro-economic and financial sectors in the world. BBL has invested in China for more than 10 years and today we are ready to expand in this country," he said.

BBL has established a Chin Sophonpanich fund at Chulalong-korn University's Chinese Studies Centre. The fund will support the publication of academic articles and research papers, as well as seminars and other activities related to Chinese studies.

Separately, Sompop Manarungsan, director of the Chinese Studies Centre, said Thailand should reform its financial sector in order to cope with China's forthcoming liberalisation. Both regulators and businesses need to address the issue.

Thailand should separate monetary-policy organisation and the regulation of commercial banks, he said. Meanwhile, commercial banks should build networking bases in China to strengthen their business with the huge country.

Somruedi Banchongduang

The Nation