Unfazed by the market turmoil across Asia, several leading U.S. banks are rapidly expanding their limited retail banking operations in the region.

BankAmerica Corp. and Chase Manhattan Corp. are busy establishing offices and making strategic purchases throughout Asia.

BankBoston Corp. is looking at expanding too, albeit in the high-end private banking arena.

"Demographics are driving consumer banking," said Antony K. Leung, a Chase managing director and regional manager for greater China and the Philippines. "These Asian countries are fast-growing economies with over two billion people, low debt levels, and high rates of savings."

This newfound enthusiasm for Asian retail banking marks a change for U.S. bankers. With the exception of Citicorp, U.S. institutions have generally stuck to corporate banking in Asia.

Furthermore, these retail banking gambits are being played in spite of the economic downturn affecting such countries as South Korea, Thailand, Indonesia, and Malaysia in recent months.

Executives argue that short-term volatility will eventually give way to a prolonged, steady consumer demand for banking services such as mortgages, auto loans, and credit cards.

Asia's enormous population, less developed local retail services, and the success of banks with consumer operations like Citicorp, HSBC Holdings, and Standard Chartered Bank may make consumer opportunities in the region hard to ignore.

"The No. 1 thing people in Asia want is a house," said James E. Hulihan Jr., group executive vice president and head of retail banking in Asia for BankAmerica. "People will die before they give up their homes, and we've had zero losses (on consumer banking) in 10 years."

Citicorp, one of the world's leading retail banks, has made no secret of its plans to expand. Last month it signed an agreement to acquire a majority of First Bangkok City Bank, pending due diligence and an agreement on the purchase price. Acquisition of the $6.4 billion-asset bank would give Citicorp an immediate 100-branch retail network in Thailand.

"Our strategy is to carefully examine opportunities that would allow us to penetrate the market deeper," said a Citicorp spokesman.

In contrast to their newfound consumer enthusiasm, both BankAmerica and Chase earlier this decade pared back the little retail banking they performed outside the United States.

As part of the current expansion, BankAmerica opened a second Taiwanese branch in October and will open a third in Kaohsiung next year. Still another is to be opened next year in Hyderabad, India, where BankAmerica already has four branches.

Branches have either opened or been relocated over the last few months in Hong Kong, where BankAmerica now has 17 offices plus two in neighboring Macau. Also, three corporate banking offices in Singapore have been converted to retail branches.

In China, BankAmerica has branches in Beijing, Shanghai, and Guangzhou, and a representative office in Dalien. It is already operating in Shanghai and across Asia through BA Merchant Services Inc., a credit card processing subsidiary.

Mr. Hulihan termed the Asian expansion a logical extension of BankAmerica's presence in the western United States.

"We're the largest ethnic Asian bank in California," Mr. Hulihan said. "This is very much a strategic fit."

Chase is working to build a consumer bank in Asia. It paid $246 million last month to acquire the 46% it did not already own of Manhattan Card, one of the top five credit card issuers in Hong Kong, with some 600,000 cards. Chase officials said they are also thinking about expanding mortgage banking and personal loans in Asia, building on a foundation in Hong Kong.

Analysts hailed the Asian growth strategies.

"Anyone in their right mind with an infrastructure would want to do it," said Robert B. Albertson, banking analyst with Goldman, Sachs & Co. The weakened condition of many Asian banks, he added, offers a "golden opportunity" to expand.

"It's an opportunity on a risk-adjusted basis to do a very nice business in some of these markets," said Thomas F. Theurkauf, an analyst with Keefe, Bruyette & Woods Inc. "Growth in Asia averaged 8% annually over the last few years. Even if that falls to a 6% average, it's nothing to sneeze at compared to 1% to 2% in Western Europe and 2% to 3% in the United States."

BankAmerica earned $237 million in Asia last year, up from $105 million a year earlier, and had some $4 billion in consumer loans in Asia at yearend, up from around $3 billion a year earlier. Although the bank does not disclose retail versus commercial banking income, executives said retail was "a substantial portion of stated income and is expected to grow."

The San Francisco company's retail moves follow a decision last year to split into separate corporate and retail units. On the corporate banking side, the decision prompted BankAmerica to curtail low-profit operations in Western Europe while expanding in Eastern Europe and other emerging markets. On the retail side, it reevaluated how to use its Asian network, most of which was picked up when BankAmerica took over Security Pacific Corp. in 1993.

To be sure, U.S. banks do not have an entirely free hand when it comes to expanding in the region. China bars foreign banks from retail banking, while Singapore and others do not allow foreigners to have more than one branch unless they buy a local bank. Malaysia, India, Indonesia, and Thailand also restrict retail banking by foreign institutions.

"We would gladly be more active if we had the option," Mr. Hulihan said. "But we don't."

He and others stressed that branches are not the only route and they are working on electronic banking services, telemarketing, and automated teller machines.

"We have the systems in place that we need to handle any growth," Mr. Hulihan said.

Similarly, Mr. Leung said that Chase does not necessarily need an extensive brick-and-mortar network. "Consumers in Asia are very receptive to telephone banking, PC banking, and TV banking," he said.

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