Like a middle-aged banker wearing the latest sneakers and baseball cap, fintech makeovers can seem a bit forced. Previous attempts to turn century-old financial institutions into reborn tech companies have often ended in disappointment.
The recent sales and closures of international digital banking companies by BBVA and ING are examples of this.
But there is a growing feeling, after Covid, that incumbent financial institutions have no choice but to try again and fail better, as fintech valuations have mushroomed.
Partly inspired by the growth of digital subsidiaries of Chinese insurance group Ping An, Siam Commercial Bank (SCB) is in the midst of what could be the traditional banking industry’s most daring leap in that direction. In November, the 114-year-old lender unveiled a plan for a radical reorganization of its shareholding structure, to prove how far it can go beyond its heritage and expand outside of Thailand.
The restructuring of SCB will result in its delisting in favor of a new financial holding company known as SCBX, of which traditional banking and asset collection will be one of the three pillars. A second pillar will house credit cards, auto financing and brokerage. A third pillar will be dedicated to new digital platforms and businesses.
SCB then plans to map card activities, followed by the ping-an-style IPOs of its new tech subsidiaries.