Thailand‘s oldest bank acquires a 51% stake in a cryptocurrency exchange

<p>SCB invests $535 million as it ramps up its fintech push.</p> <p>Siam Commercial Bank, Thailand's oldest lender, is expanding its fintech footprint with the acquisition of a 51 percent controlling stake in local cryptocurrency exchange Bitkub Online for 17.85 billion baht ($535 million).</p> <p>Bitkub's total valuation is estimated to be 35 billion baht ($1.05 billion) in the deal, making it the country's latest unicorn in an era when startups were considered scarce. The term "unicorn" refers to a private company with a market capitalisation of at least $1 billion.</p> <p>The investment comes as traditional banks in Southeast Asia seek to modernise in order to compete with tech giants offering digital services such as consumer loans and electronic payments.</p> <p>"Digital asset exchanges have exploded in popularity over the last few years and will continue to do so in the long run," said Arthid Nanthawithaya, the bank's CEO and chairman. "The move is consistent with SCB Group's strategy to transform into a financial technology company, addressing new consumer needs and entering a new competitive arena that will emerge rapidly over the next three to five years."</p> <p>Investors reacted positively to the move, with Siam Commercial Bank's shares rising nearly 3.5 percent to 134.5 baht following the announcement. Bitkub coin, the startup's cryptocurrency, increased 180 percent in value to $2.78 from $0.99, according to market tracker Coincost.</p> <p>The bank anticipates completing the acquisition in the first quarter of 2022, pending approval from the Bank of Thailand and the country's Securities and Exchange Commission.</p> <p>SCB is well-known for its novel ownership structure. It was established in 1904 by Thailand's royal family, and King Maha Vajiralongkorn now owns 793 million shares, or nearly a quarter of the bank.</p> <p>Thailand's fourth-largest bank in terms of assets already has a fairly diverse clientele. Among the companies under its umbrella are SCB Abacus, an AI-driven fintech company, a