October 26, 2016 01:00 By SUCHEERA PINIJPARAKARN
The Nation
CREDIT-CARD issuers are predicting a significant decline in spending this quarter because of lacklustre consumption sentiment after the departure of His Majesty King Bhumibol Adulyadej.
Ayudhya Capital Services, also known as Krungsri Consumer, the consumer-finance arm of Bank of Ayudhya, has seen a significant drop in its credit-card spending since His Majesty’s death, especially in the dining category, said Krungsri Consumer managing director Nayanee Peaugkham.
Normally, the fourth quarter accounts for 40 per cent of total yearly spending with its cards, but Krungsri Consumer expects the gloomy sentiment to last into December. Therefore it is considering revising down its full-year credit-card-spending forecast, she said.
“We have cancelled all above-the-line activities including concerts to enhance spending in the fourth quarter, and promotions have been offered to cardholders at the selling points instead,” she said.
For example, Krungsri Consumer had planned an energetic campaign to promote iPhone 7 purchases last week, but it now has been toned down, and is only being communicated to customers in mobile-phone shops.
Teranuj Koomsap, executive vice president of Thanachart Bank, said spending with the bank’s credit cards plunged on October 14, the day after His Majesty passed away. Spending now has picked up a bit, but it is not as lively as before.
“Credit-card spending during long weekends normally rises, but it was flat during the recent long weekend,” she said, referring to October 22-24.
TBank has cancelled above-the-line activities for its credit card as well. Normally, the fourth quarter accounts for 30 per cent of its total annual credit-card spending.
TBank has maintained its target for monthly credit-card spending at between Bt2 billion and Bt2.5 billion. However, the bank will carefully monitor the situation into early next year.
Supaneewan Chutrakul, first senior vice president of Kasikornbank, said its customers had used credit cards to purchase black clothing, so overall spending via KBank cards had not slowed as much as expected. However, the bank will review the overall rate of consumption again to analyse how it will affect credit-card spending this quarter.
KBank has cancelled its credit-card promotions during the mourning period, including text messages sent to its customers.
October 26, 2016 01:00 By SUCHAT SRITAMA
The Nation
A SWEDISH software provider, IFS, has developed a cost-management solution to cope with the rapid growth of aviation in the Asia-Pacific region.
“It can help aerospace operators and airlines reduce costs by up to 10 per cent per flight,” Espen Olsen, director of business development and sales for aerospace and defence, said yesterday.
The new solution called “Tail Planning, Optimisation and Assignment” was designed specifically for civil aviation, as it ensures optimal aircraft allocation for all flights and routes.
Dynamic scheduling reduces the impact of maintenance on airline operations. It can maximise fuel savings by reducing maintenance inefficiency through better allocation of aircraft to long-haul routes and assigning aircraft for maintenance.
However, it may force users to cut some jobs as it can replace some featherweight staff. Although the launching ceremony will be held in Sweden, the group is eyeing Asia and the Pacific, as the aviation industry in the region will continue to grow in the long term.
The International Air Transport Association predicts air-passenger growth doubling by 2035, with 7.2 billion people travelling by air over the next 20 years.
Four Asia-Pacific countries – China, India, Indonesia and Vietnam – are among the five fastest-growing markets.
Aircraft maintenance, repair and overhaul (MRO) demand in the Asia-Pacific region is already ahead of Europe and only just behind the United States.
Olsen expects the new solution to serve 40 new aerospace operators and airline clients in this region including four or five in Thailand after introducing the new service today in Gothenburg.
During the introductory period, the company is organising a two-day “Aviation and Aerospace MRO & Flight Operations IT Conference” in Bangkok today and tomorrow as part of regional expansion plans.
IFS has offices across the Asia-Pacific region including Bangkok, from where it provides services to the Royal Thai Air Force.
IFS has been in Thailand for nearly three decades, serving finance, human-resource, production and supply-chain management and solutions before shifting to the aviation segment.
Key customers are GFPT, CP Engineering, Jotun, Tokai Rubber and Asia Silicones Monomer.
Earlier this year consulting company ICF International said MRO demand in the Asia-Pacific region was 28 per cent of the global market. It has already outstripped Europe’s 26 per cent, and is only 1 per cent lower than the US.
IFS has appointed a market-development team to strengthen its presence in the booming Asean aerospace and defence markets.
This year IFS launched its Engine MRO solution to the Asia-Pacific civil-aviation market.
Engine MRO is an integrated enterprise asset management and MRO solution for the civil-aviation industry.
October 25, 2016 01:00 By SUCHEERA PINIJPARAKARN
THE NATION
BANGKOK BANK’S Vietnam operation has lost market share to local banks after they adopted aggressive pricing strategies.
“We have lost some share of Thai corporations to them [local banks]. However, the bank sometimes has to allow the use of pricing to retain quality customers,” said Tharabodee Serng-Adichaiwit, BBL’s senior vice president and general manager for Vietnam.
Vietnamese banks need to lower their non-performing loan ratios, so they need to boost lending as much as they can, he said.
Vietnamese banks enjoy a lower cost of funds than foreign banks, so they can offer lower fees to customers.
Some Thai corporations doing business in Vietnam have switched to using Vietnamese banks for their credit needs such as project finance.
Normally, local banks will have exposure in consumer products and real estate, which are not the targets of Bangkok Bank.
However, local banks are now moving to top-tier customers, which are in the crosshairs of Bangkok Bank, as they are quality customers.
“Therefore, the competition this year is quite serious,” said Tharabodee, who also is manager of the Ho Chi Minh City branch.
Overall loans so far this year still are short of target, especially at the Ho Chi Minh branch, because of the fierce competition.
Some customers have also had to spend much time dealing with the complicated regulations for buying land and property.
However, the Hanoi branch has achieved the loan-growth target of 15 per cent after the bank increased the registered capital of the Ho Chi Minh and Hanoi branches to a combined US$250 million (Bt8.8 billion) from $80 million. The Hanoi branch had been unable to lend to some corporate customers because of the single lending limit, but after expanding capital, it can serve demand.
In Vietnam, a bank’s loans to a company cannot exceed 15 per cent of its capital and for a group of companies, the cap is 25 per cent.
Both branches have 40 deals in the pipeline for financing projects, mergers and acquisitions and greenfield projects. Bangkok Bank hopes that half of those deals will be finalised this year.
The bank has room to achieve the growth target of 15 per cent despite the price war in the market.
Vietnam demands investment in electricity to support economic growth, so the energy business is an interesting segment for foreign investors including Thai corporations.
As a developing country with a growing middle class, Vietnam is giving importance to reducing pollution, so renewable energy has become the choice.
This will be an opportunity for Thai corporations. However, the cost of renewable energy might be unattractive now, Tharabodee said.
