Outsider vs veteran: Who will lead Thailand's central bank?

Reuters

27-06-2025

BANGKOK, June 27 (Reuters) - A former private sector executive with experience of handling major state-owned financial institutions and a long-time central banker who could maintain continuity are in the race to become the next governor of the Bank of Thailand.
A seven-member panel this week shortlisted two candidates to replace Governor Sethaput Suthiwartnarueput who ends his term on September 30.
Vitai Ratanakorn and Roong Mallikamas, respectively, offer a choice between an outsider governor who could be more amenable to the government and an institutional stalwart with experience in economics and financial policy, according to three people,
including economists and a government source.
Finance Minister Pichai Chunhavajira will pick one of them to propose to cabinet for approval before being sent to the king for royal endorsement. The cabinet is due to meet on Tuesday and Pichai has suggested the announcement could be made around his trip to the United States next week for trade talks.
The candidates and spokespersons for Thailand's finance ministry and central bank declined to comment.
The new governor will take the reins at a time of global trade turmoil and a raft of domestic challenges in Southeast Asia's second-largest economy.
Vitai, 54, president and chief executive of Government Savings Bank, Thailand's largest state-run lender, could be better aligned in working with the Pheu Thai party-led government, which has been struggling to fire up growth, three people said.
"A central bank led by Vitai could be more flexible and adopt a broader perspective," said Piyasak Manason, head of economic research at InnovestX Securities.
With degrees in economics and law from Thailand's Chulalongkorn and Thammasat universities, Vitai spent time working in the country's private sector before becoming Secretary-General of the Government Pension Fund, which manages assets worth about 1.4 trillion baht ($43 billion), in 2018.
In 2020, he was appointed by the government to lead the Government Savings Bank.
"Vitai will be able to work well with the finance ministry and this minister because they have been working together for a while," a finance ministry source told Reuters, asking not to be named, because they were not authorised to speak to the media.
Thailand's economy has lagged regional peers as it struggles under high household debt and borrowing costs, and slowing tourism, a key growth driver. The government has been pressing the central bank to cut rates to support the economy.
The BOT has some operational independence, but the government appoints its chief and approves its inflation target.
Last week, on a Thai financial daily's YouTube show, Vitai outlined the need to continue reducing rates to support a stagnant economy.
"Proactive easing is important. It is not another one or two cuts," he said.
"We may have to reduce them for a long time and deeply. So, from 1.75%, if you ask me personally, I think it can go down much further."
On Wednesday, the central bank left its key policy rate steady at 1.75% after two consecutive cuts earlier this year, seeking to save some policy ammunition if needed to help growth amid trade uncertainty and renewed domestic political turmoil.
HAWK AND DOVE
Roong, 56, is an old hand at the central bank, where she has worked for nearly three decades and is currently a deputy governor, supervising matters related to financial institutions. In her previous positions, Roong's responsibilities have covered macroeconomic and monetary policy, and financial markets.
Within the finance ministry, there is some trepidation that Roong would largely continue Sethaput's approach.
"Roong is outstanding in terms of qualifications and work experience at the central bank," said the finance ministry source. "But she may adopt a policy that is not different from before."
The central banker, who served as a Senior Executive Vice President at the state-owned Krungthai Bank between 2017 and 2019, holds an undergraduate degree from Harvard University and a Ph.D. in economics from the Massachusetts Institute of Technology.
"Roong is a very capable person but too much BOT DNA and thinking," said an economist at a major bank. "Roong is more hawkish while Vitai is more dovish to accommodate the government."
($1 = 32.57 baht)