LH Bank defers plan to break even
The plan by Land and Houses Retail Bank to break even by the end of this year will have to be put on hold for another year, says president Sasitorn Phongsathorn.
The delay is due mainly to costs incurred in expanding its outlets, with a goal of opening at least 10 new branches a year. The bank expects to have a total of six outlets this year: five sub-branches, plus one full branch located in Chang Mai. "In accordance with the earlier plan, without branch expansion we would have reached our target of breaking even this year, when the bank's total loan portfolio is expected to be Bt18.5 billion," she said. However, the bank adjusted its total loan-portfolio target to Bt14.5 billion by year's end, from Bt13.8 billion currently. Sasitorn said the bank planned to provide Bt10 billion worth of new lending next year, concentrating more on home loans. Of the new loans, 70 per cent will be mortgage loans, with the remainder going to small and medium-sized enterprises (SMEs). The small niche bank plans to slow SME-loan expansion next year, due mainly to its new International Accounting Standard 39 (IAS39). Under IAS39, loan collateral for SMEs, which is mainly land and machinery, is devalued. Somruedi Banchongduang The Nation
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