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TBank: Rivalry to heat up

Thanachart Bank is braced for fiercer competition in deposits, especially in the second half.

Competition for bank deposits is expected to intensify in the second half of the year, prompted by stronger loan demand from state investment in infrastructure projects and the broader economic recovery, says a senior official at Thanachart Bank (TBank).

Banking loans will grow this year, underpinned by the government's hefty investment in infrastructure megaprojects, with most lending to occur in the latter half of the year, said TBank executive vice-president Teranuj Koomsap.

The country's sixth-largest bank aims for 10% growth in deposits to 677 billion baht by year-end, Mrs Teranuj said.

Despite plentiful liquidity in the banking sector and a steady policy rate of 1.5% for years, price competition for deposits will increase, she said.

Special deposit accounts with attractive interest rates and transactional fee waivers will be the bank's key strategies to entice depositors and prepare for the tougher competition in deposits.

TBank is offering two innovative deposit products with higher interest rates -- e-Savings and Freever -- on its mobile banking platform, Thanachart Connect, to meet the lifestyle needs of new-generation clients.

The bank launched e-Savings at the start of 2017. The product eliminates the need for passbooks when making transactions and allows cash withdrawals without interest rate reductions.

E-Savings depositors receive 1.5% a year if they do not tie the account to PromptPay and 1.8% if they link the account to the electronic money transfer service.

The Freever savings account has been available since late last year. The product waives fees for account holders when they make up to 20 banking transactions and removes transaction limits if the account is wired with PromptPay.

"Accounts tied to PromptPay and PromptPay transactions remain low compared with the number of overall savings accounts but are continuing to grow," Mrs Teranuj said. "Transactions via PromptPay service represent about 10% of the bank's total transactions. However, this will continue to increase after consumers become more aware of the service."

She said the bank aims for 10 billion baht in new deposits this year from the two savings products and 10% growth in deposit accounts, up from 4 million at present.

TBank also expects to increase the share of current and savings accounts to 50% of total deposits outstanding from 46%.

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