BAM, CHAYO bounce on joint venture asset management licence

Bangkok Commercial Asset Management (BAM), Thailand’s largest distressed asset manager, saw its stock jump 4 per cent on Friday, following the central bank’s permission to form joint ventures with banks to handle bad debts.

BAM rose to 20.80 baht during the morning session. Chayo Group (CHAYO), another asset manager, also gained 4.8 per cent from its prior closing to 13.10 baht. 

On Thursday, the Bank of Thailand ruled out conditions for setting up a joint venture asset management company (JV AMC), allowing financial institutions to apply for a 15-year licence over the next three year. 

As financial woes have heightened in the wake of the Covid-19 pandemic, JV AMC will support financial institutions with more flexibility and help borrowers for the longer term, the bank said. 

Analysts at KTB Securities viewed this development as positive for the finance sector, saying the formation of AMC JV and cooperation with commercial banks will boost earnings of the asset management companies.  

“We expect to see clear details on JV AMCs and their performance in the second half of the year,” KTB said in a research note. Their top pick among asset managers is JMT Network Service (JMT). 

Previously JMT had reached a deal to form JV AMC with the country’s major lender Kasikornbank (KBANK). Krungthai Bank (KTB) is also looking to set up its AMC unit in the second half of this year.

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