Thailand’s SCBX reaffirms partnership with Kakao Bank

Thailand’s largest financial group SCBX has reaffirmed its commitment to the digital banking partnership with Kakao Bank despite growing legal risks surrounding Kakao Corp., the controlling shareholder of the Korean internet-only bank.

"We do not foresee any changes to our current business relationship (with Kakao Bank) based on the recent news," SCBX's Chief Customer Officer Sutirapan Sakkawatra told The Korea Herald via email, regarding the impact of Kakao's legal developments.

On July 23, Kakao Corp.'s founder and top decision-maker Kim Beom-su was arrested on charges of stock manipulation related to the IT giant's takeover of K-pop powerhouse SM Entertainment last year, fueling uncertainty over key Kakao companies, including Kakao Bank.

"Our focus remains on our business operations and ongoing projects," the chief publicist continued, adding, "Regarding our partnership with Kakao Bank, we continue to collaborate on our joint initiatives as planned for Thailand."

SCBX, which owns Siam Commercial Bank, Thailand’s leading lender, is a key partner for Kakao Bank in its ambitious expansion into Southeast Asia.

With virtual banking services debuting in Thailand in 2026, the local authorities have started accepting applications for the three operating licenses, and an SCBX-led consortium is considered one of the potent bidders. Kakao Bank, along with China’s leading online lender WeBank, are the key members of the consortium.

With the review process set to be completed by the first half of next year, the Korean firm aims to secure at least 20 per cent of the shares in the upcoming virtual bank.

But the global partnership has recently come under scrutiny amid concerns about the impact on Kakao Bank from the escalating legal troubles of Kakao Corp. with Kim's indictment.

If Kim is found guilty and receives more than a fine, Kakao Corp., which Kim represents, risks losing its majority shareholder position in the banking arm. Local Internet banking rules prohibit anyone convicted of a financial crime in the past five years from holding more than a 10 per cent stake in a bank, which would force Kakao to sell the excess from its current 27.6 per cent stake in Kakao Bank.

Some industry insiders predict that Kakao Bank's push into Thailand will receive support from local financial authorities despite its legal troubles, as a successful entry would mark the first inroads by a South Korean lender into Thailand in almost three decades.

"The two countries are working to improve their once-disrupted banking relationship, and if Kakao Bank succeeds (in acquiring the license), it would be a significant feat not only for the company but for the Korean government as well. Authorities will likely continue to support this initiative," an industry source said on condition of anonymity. During the 1997 financial crisis, all Korean banks withdrew from Thailand, and none have successfully reentered the market since.

The fact that Kakao Bank is the only internet-only bank in Korea pursuing global business is a factor that cannot be overlooked by the Korean authorities, the source added. Kakao Bank is also a major shareholder in Indonesia’s digital bank Superbank, which started operations in June.

During his meeting with Bank of Thailand Governor Sethaput Suthiwartnarueput in February this year, Korea’s Financial Services Commission Vice Chairman Kim So-young vowed his full support for Kakao Bank’s venture, reportedly stating that Kakao Bank could “contribute to the development of Thailand’s financial industry.”

Choi Ji-won

The Korea Herald

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