LHB bridges investment and advisory services gap for younger customers

• Expanding investment and advisory services to the youth market
• Targeted, curated investment experience
• Growing user base and high engagement

LH Bank (LHB) reported growth in 2022 across multiple areas, with total assets rising by 17%, reaching TBH 296 billion ($8.4 billion), while total deposits increased by 20.2% to TBH 231 billion ($6.6 billion). The bank also saw a 23.6% surge in its loans amounting to TBH 210 billion ($6 billion).

The bank’s net profit for 2022 rose significantly by 58.26% from 2021, an increase of THB 402.5 million ($11.5 million) to reach THB 1.1 billion ($31 million). This was primarily attributed to a 12.93% rise in net interest income and a reduction in expected credit losses by THB 733.45 million ($20.94 million) or 22.34%, compared to 2021.

In the same year, the bank enhanced its digital processes and upskilled its employees to improve business quality.

Expanding investment and advisory services to the youth market
LHB has taken a significant step in bridging the investment and advisory gap for the young and digital-savvy emerging-affluent segment. Banks traditionally focus on high-net-worth individuals, typically neglecting younger investors with fewer assets. As advisory services are often fee-based, the revenue opportunity from younger customers is not attractive enough for larger banks.

Not so for LHB—its dedicated investment app, Profita, caters to the specific needs of this segment, offering a wide range of investment products, and empowering the next-generation to make informed investment decisions and take control of their finances at a younger age.

Targeted, curated investment experience
Profita is the first investment application in Thailand that fully consolidates asset offerings from multiple fund houses, making it a comprehensive and accessible platform. It integrates products from 16 fund houses, giving customers access to over 800 mutual funds across various asset classes. This wide selection goes beyond the bank’s own funds and provides customers with diverse investment options.

The app also incorporates robo advisory features and fund comparison tools, allowing users to make informed investment decisions. Profita’s robo advisor has three main investment themes: goal-based planning, wealth growth planning, and thematic planning. These help users to customise their investments according to their financial objectives.

Free advisory services is an attractive value-add for customers, explains Kelvin Foo, head of retail banking at LHB. Profita is a standalone app, and runs outside of the bank’s main mobile banking platform LHB YOU. Keeping the platforms distinct allows LHB to provide dedicated features and functionalities on the investment app. 

Kelvin Foo, Head of Retail Banking at LH Bank

Growing user base and high engagement

LHB’s revenue model for Profita follows the industry standard, in which front-end and trial fees are charged based on the investment amount. This ensures that the bank generates revenue while offering a valuable investment service.

Since its launch, the app has onboarded 8,000 new users per month between January 2023 and April 2023, indicating strong demand. Among registered users, 50% belong to the emerging affluent segment, reflecting LHB’s success in target marketing. About 20% of users are also first-time investors, indicating that Profita is effectively engaging with individuals new to investing. Around 60% of all users access the investment information offered by Profita monthly, showing a high level of engagement.

LHB leverages the FundConnext platform provided by the Thailand Securities and Exchange Commission to trade with multiple asset management companies using a single fund account opening form. While Profita can compare up to 15 mutual funds across 800 funds from 16 fund houses, it is not directly based on FundConnext. This positions the bank as a fund hub, providing information and comparison capabilities.

LHB pushes the envelope on the immersive banking experience while delivering robust financial performance. Its cost-effective advisory solution encourages long-term loyalty from young investors as they start to grow their wealth.