“KBank must be an excellent operating bank by focusing on how to save expenses and all investment must be valuable.

“KBank will leverage the digital technologies that we have invested in for many years to multiply services and work with business partners to boost long-term competitiveness for sustainable growth,” president Kattiya Indaravijaya told a press conference on the bank’s 2017 business plan yesterday.

The year 2017 will be more challenging with the introduction of national e-payment, new entrants in the market, customer behaviour changes and further digitalisation.

This is putting more pressure on revenue.

The conditions could be both threats and opportunities. If the bank does business like before, earnings could not grow like before.

National e-payment will hit the fee incomes of the banking industry especially from money transfers.

KBank’s revenue from digital banking including ATMs this year to date has reached Bt10 billion, jumping from Bt7 billion last year.

Its cost-to-income ratio is projected to remain at 45 per cent next year.

KBank targets fee income growth of 4-6 per cent next year, slipping from the projection of 10 per cent in past years, after adding the impact from the launch of the national e-payment system.

Physical branches will be retained, but they will get more digital technologies to manage costs and automate transaction processing.

The bank will partner with financial technology (fintech) and telecom operators to create a digital ecosystem that will make KBank and its partners stronger, she added.

Teeranun Srihong, president of KBank, notes that technological advances continue to alter the financial landscape, particularly in channels and modes of transactions.

To maintain its competitiveness, tap new markets as they form and expand along with evolving digital lifestyles, the bank will continue to develop new business models through partnerships as well as the development of comprehensive services, and apply advanced technology to all customer segments.

In 2017, KBank will allocate 10 per cent of net profits as the IT budget, with about Bt4 billion for innovation, and about 2 per cent, or Bt1 billion, for venture capital (VC) investment for innovation development.

The bank is asking permission from the Bank of Thailand to set up the VC fund.