Gulf turns down KBank's share repurchase request

Kasikornbank's (KBank) share repurchase programme has drawn market attention following reports that the bank asked its major shareholder, Gulf Development (Gulf) Plc, to refrain from selling KBank shares during the buyback period.

- NUNTAWUN POLKUAMDEE

Analysts said the move was intended to ensure compliance with the Bank of Thailand's rules on ownership limits in financial institutions.

According to multiple market sources, KBank expressed concern that if Gulf - which holds more than 5% of the bank's shares were to sell directly to KBank, such a transaction could breach central bank regulations.

Under the central bank's rules, any shareholder owning more than 5% of a financial institution must obtain approval before selling stock, and these shares cannot be sold directly to the bank itself. Instead, they must first be sold to other investors.

Gulf, however, declined to comply with KBank's request, saying its investment decisions are guided by a fiduciary duty to act in the best interests of its shareholders. The company clarified in a filing to the Stock Exchange of Thailand (SET) that KBank's buyback programme does not restrict Gulf's right to trade its shares.