Foreign banks may open more branches

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Foreign banks may open more branches 
Bangkok Post: 18 Aug 2009
www.BangkokPost.com

BoT allows more branches of foreign banks

The Bank of Thailand will permit foreign banks to open up to two additional branches by the end of the year.

Sorasit Soontornkes, an assistant central bank governor, said foreign banks in Thailand would be able to operate up to three offices in Thailand, including their headquarters.

The central bank in 2004 announced that foreign banks may change to subsidiary status, with the right to open new branches, by converting their existing licences. But only Taiwan's Mega International Commercial Bank took advantage of the rule, with other banks, such as HSBC and Citibank, choosing to remain limited to a single branch.

Banks seeking subsidiary status must comply with minimum capital rules and also face legal and organisational complications, such as revising their current contracts with counterparties.

With the second financial sector development plan, the 15 full-branch foreign banks operating in Thailand will have the freedom to open two new offices without restriction.

The development plan will also expand opportunities for foreign institutions to offer services in segments such as Islamic finance, microfinance, treasuries and securities depository services.