Exim Thailand looks to lead CLMV push
Export-Import Bank of Thailand (Exim Thailand) aims for 9% lending growth this year, with a focus on small and medium-sized enterprises (SMEs) and outbound investment in Cambodia, Laos, Myanmar and Vietnam (CLMV).
Should the target hold true, the bank’s outstanding loans will reach 100 billion baht this year, said president Pisit Serewiwattana.
The bank’s total loans stood at 91.8 billion baht at the end of 2017.
Exports and Thai direct investment in CLMV are on the rise, with merchandise shipments to neighbouring countries surging by 13% on average yearly to 850 billion baht last year, up from 260 billion in 2007. Investment growth averaged 30%, reaching 470 billion baht in 2017, up from 33 billion a decade ago.
Exim Thailand’s outstanding loans for investment in CLMV totalled 27.8 billion baht last year, jumping 12% from a year earlier.
Loans for investment in the market represented 30% of the bank’s total portfolio at the end of 2017.
Of the 27.8 billion baht in loans, 26 billion were lent to finance investment in infrastructure and energy projects, while the rest went to the service and construction sectors.
For SME loans, the state-run bank aims to raise its number of borrowers to 2,948 by year-end, up from 2,348 at present. The move is in line with the government’s policy of helping local SMEs expand abroad.
There are 25,000 SME exporters, of which 9.3% are Exim Thailand customers. The country has 3 million SME operators.
Exim Thailand’s lending to SMEs jumped by 22% to 2.18 billion baht, with outstanding SME loans totalling 37.1 billion at the end of last year.
Mr Pisit said the bank is worried about the small number of SMEs who have taken out credit insurance.
Only 162 of the 2,300 SME exporters who are Exim Thailand’s customers have bought credit insurance, he said.
Most SMEs are required by their trade partners to pay in cash, contributing to the low percentage of credit insurance purchases by SMEs, said Mr Pisit.
He said by providing loans and credit insurance to reduce the risk of not getting paid, Exim Thailand will bolster SMEs’ expansion efforts abroad.
The bank aims for its credit insurance premiums to reach 85 billion baht this year.
Exim Thailand’s credit insurance premiums rose by 13% to 65.9 billion baht at the end of last year, said Mr Pisit.
Separately, he said the Laotian government will likely approve the bank’s application to open a representative office there in the next 1-2 months after the bank’s first overseas representative office was opened in Myanmar last year.
Cambodia and Vietnam are the bank’s next targets for such offices, said Mr Pisit.