Siam City's suitors to submit final bids

HSBC and KDB compete to seize the chance of extending operations in the under-banked country.

People privy to the matter said HSBC was expected to face stiff competition from Thanachart, a local lender that is 49 percent owned by Canada's Bank of Nova Scotia, and Korea Development Bank when bids close as these banks are bidding for a government-held 47.58 percent stake in Thailand’s seventh-largest bank, with bids expected to top $800 million.

The Thai government has announced that no new full-service banking licenses will be granted in the foreseeable future, making Siam City the last chance for overseas investors such as HSBC and KDB to buy in to a relatively under-banked market, according to a report in the Financial Times.

KDB has stated its ambition to become a leading corporate and investment bank in Asia 2012 and is looking to expand its deposit base before a stock market listing next year.

Meanwhile, HSBC's interest forms part of the bank's greater focus on the Asia-Pacific region.