Latest news with #GovernmentSavingsBank
Bangkok Post
5 days ago
- Business
- Bangkok Post
Aid efforts aim to ease the burden
The Finance Ministry has issued measures to alleviate the economic impact on communities along the Thai-Cambodian border by implementing debt suspensions, interest rate reductions, and low-interest loan measures for affected individuals. According to Finance Minister Pichai Chunhavajira, the unrest stemming from clashes between security forces along the Thai-Cambodian border has affected the safety of local residents and disturbed the economy and social fabric of communities. The incidents have caused property damage and disrupted the livelihoods, occupations, and businesses of the people in the area, he said. In response, the ministry directed state financial institutions to offer various measures to alleviate the impact. For example, Government Savings Bank is to offer a suspension on principal repayments and partial interest payments, along with low-interest loans to small and medium-sized enterprises (SMEs) at a monthly interest rate of 0.75%, with a repayment term of 60 months. For SMEs, loans of up to 5 million baht per borrower are available, with a first-year interest rate matching the minimum loan rate (MLR) minus 2.65%, followed by the MLR for the remainder of the seven-year loan term. Meanwhile, the Bank for Agriculture and Agricultural Cooperatives plans to provide emergency loans for consumer expenses, up to 50,000 baht per borrower at the minimum retail rate for a loan term of up to three years. The first six months are interest-free. According to Mr Pichai, the SME Development Bank of Thailand is to offer a fixed interest rate of 3% a year for three years, with a maximum loan term of 10 years. The Export-Import Bank of Thailand plans to extend debt repayment periods up to 365 days, reduce interest rates by up to 20% of the original rate, and provide a temporary credit line increase of up to 30% of the original limit for one year, with a starting interest rate of 2.99% a year. In addition, the Comptroller-General's Department increased the emergency spending authority for provincial governors along the Cambodian border to 100 million baht in four provinces -- Surin, Si Sa Ket, Buri Ram and Ubon Ratchathani -- to support relief efforts for people affected by border-related issues. Governors are usually authorised to spend no more than 20 million baht under emergency provisions. In a separate development, Suwannee Jatsadasak, assistant governor of the Bank of Thailand's financial institutions policy group, said the central bank is monitoring how financial institutions are supporting both their employees and customers during the disputes. Thai financial institutions with branches in Cambodia have gradually repatriated their Thai staff, with all expected to return to Thailand as of yesterday. Some bank branches in Thai border provinces, specifically Surin, Si Sa Ket, Ubon Ratchathani, Buri Ram, Sa Kaeo, Trat and Chanthaburi, have been temporarily closed. On Thursday, the Thai Bankers' Association announced its member banks are temporarily closing their branches along the Thai-Cambodian border to ensure the safety of customers and the public, citing unrest in the area that has resulted in loss of life, property damage, and disruption to local livelihoods.
Bangkok Post
5 days ago
- Business
- Bangkok Post
Steps prepared to ease conflict's economic impact along Thai-Cambodian border
The Finance Ministry has issued measures to alleviate the economic impact on communities along the Thai-Cambodian border by implementing debt suspensions, interest rate reductions, and low-interest loan measures for affected individuals. According to Finance Minister Pichai Chunhavajira, the ongoing unrest stemming from clashes between security forces along the Thai–Cambodian border has affected the safety of local residents and expanded its impact to the economy and social fabric of surrounding communities. The incidents have caused property damage and severely disrupted the livelihoods, occupations, and businesses of the people in the area. In response, the Finance Ministry has directed state financial institutions to assist through various measures aimed at alleviating the impact. For example, the Government Savings Bank has been tasked with offering a suspension on principal repayments and partial interest payments, along with low-interest loans to small entrepreneurs at a monthly interest rate of just 0.75%, with a repayment term of 60 months. For SMEs, loans of up to 5 million baht per borrower are available, with a first-year interest rate of the minimum loan rate (MLR) minus 2.65%, followed by the MLR for the remainder of the 7-year loan term. Meanwhile, the Bank for Agriculture and Agricultural Cooperatives will provide emergency loans for consumer expenses, up to 50,000 baht per borrower, with an interest rate at the minimum retail rate (MRR) and a loan term of up to three years. The first six months are interest-free. According to Mr Pichai, the Small and Medium Enterprise Development Bank of Thailand would offer a fixed interest rate of 3% a year for three years, with a maximum loan term of 10 years. Meanwhile, the Export-Import Bank of Thailand will extend debt repayment periods up to 365 days, reduce interest rates by up to 20% of the original rate, and provide a temporary credit line increase of up to 30% of the original limit for one year, with a starting interest rate of 2.99% a year. Additionally, the Comptroller General's Department has increased the emergency spending authority for provincial governors along the Cambodian border to 100 million baht in four provinces, namely Surin, Sri Sa Ket, Buri Ram and Ubon Ratchathani, to support relief efforts for people affected by border-related issues. Governors are usually authorised to spend no more than 20 million baht under emergency provisions. In a separate development, Suwannee Jetsadhasak, assistant governor of the Bank of Thailand's financial institutions policy group, said the central bank is closely monitoring how financial institutions are supporting both their employees and customers during the ongoing situation. Thai financial institutions with branches in Cambodia have gradually repatriated their Thai staff, with all expected to return to Thailand as of yesterday. Meanwhile, some bank branches in Thai provinces along the border, specifically Surin, Sri Saket, Ubon Ratchathani, Buri Ram, Sa Kaeo, Trat and Chanthaburi, have been temporarily closed. On Thursday, the Thai Bankers' Association announced that its member banks are temporarily closing their branches along the Thai–Cambodian border to ensure the safety of customers and the public, citing unrest in the area that has resulted in loss of life, property damage, and disruption to local livelihoods.
Bangkok Post
22-07-2025
- Business
- Bangkok Post
Thailand's next central bank chief champions rate cuts to revive growth
Vitai Ratanakorn, the incoming governor of the Bank of Thailand, by his own admission, will start his new job in October at a difficult time. Growth in Southeast Asia's second-largest economy has stalled, tense negotiations with the United States over trade tariffs continue, industrial sentiment is tepid and critical sectors, including tourism and manufacturing, aren't firing. "We must accept that the Thai economy is not doing so well," Mr Vitai, who has been approved by the cabinet as the next central bank chief but awaits royal endorsement, told reporters last week. "And what is worrying is the sluggishness that may be prolonged." The 54-year-old, who currently serves as president and chief executive of the Government Savings Bank, Thailand's largest state-owned lender, has a prescription: more rate cuts. The central bank late last month left the key interest rate unchanged, underlining the need to save some policy ammunition, after cuts in October, February and April. Those reductions brought the one-day repurchase rate to 1.75%, the lowest in more than two years. "Proactive easing is important," Mr Vitai told Thai financial daily Krungthep Turakij on June 20, when he was locked in the race for the top job with central bank insider Roong Mallikamas. "It's not just another one or two cuts. We may have to reduce them for a long time and more deeply. So, from 1.75%, if you ask me personally, I think it can go down much further." Thailand's ruling Pheu Thai Party, which took power in 2023, has been at loggerheads with current Bank of Thailand chief Sethaput Suthiwartnarueput for not cutting rates enough to support a sluggish economy. In May last year, before she became prime minister, Pheu Thai leader Paetongtarn Shinawatra said the central bank's independence was an "obstacle" in resolving economic problems, underlining the scale of the friction. Mr Vitai's stance will likely tone down some of that conflict, but it has also raised questions about his own ability to lead the central bank without succumbing to pressure from the ruling party - an issue he has publicly addressed. "I am confident that I can make decisions independently, based on principles and prioritising the nation's interests, free from the influence of any groups," Mr Vitai wrote on his Facebook page on July 8. Mr Vitai studied economics and law at Chulalongkorn and Thammasat universities, and finance at Drexel University in the United States, and entered the Thai private sector, where he worked at Charoen Pokphand Group and budget carrier Nok Air. A former colleague, who worked alongside Mr Vitai at a private firm, described him as a team player who preferred to work with consensus. "He is more of a practicalist than a theorist, focusing on getting the job done," he said, asking not to be named because he is not authorised to speak to media. In 2018, Mr Vitai was appointed the Secretary-General of the Government Pension Fund, which manages assets worth about 1.4 trillion baht, and two years later became the head of the Government Savings Bank. Thirachai Phuvanatnaranubala, a former Thai finance minister, said Mr Vitai's long experience as a government banker should help him manage relationships with senior finance ministry leadership.
The Star
22-07-2025
- Business
- The Star
Thailand's next central bank chief champions rate cuts to revive growth
BANGKOK: Vitai Ratanakorn, the incoming governor of the Bank of Thailand, by his own admission, will start his new job in October at a difficult time. Growth in Southeast Asia's second-largest economy has stalled, tense negotiations with the United States over trade tariffs continue, industrial sentiment is tepid and critical sectors, including tourism and manufacturing, aren't firing. "We must accept that the Thai economy is not doing so well," Vitai, who has been approved by the cabinet as the next central bank chief but awaits royal endorsement, told reporters last week. "And what is worrying is the sluggishness that may be prolonged." The 54-year-old, who currently serves as president and chief executive of the Government Savings Bank, Thailand's largest state-owned lender, has a prescription: more rate cuts. The central bank late last month left the key interest rate unchanged, underlining the need to save some policy ammunition, after cuts in October, February and April. Those reductions brought the one-day repurchase rate to 1.75%, the lowest in more than two years. "Proactive easing is important," Vitai told Thai financial daily Krungthep Turakij on June 20, when he was locked in the race for the top job with central bank insider Roong Mallikamas. "It's not just another one or two cuts. We may have to reduce them for a long time and more deeply. So, from 1.75%, if you ask me personally, I think it can go down much further." Thailand's ruling Pheu Thai party, which took power in 2023, has been at loggerheads with current Bank of Thailand chief Sethaput Suthiwartnarueput for not cutting rates enough to support a sluggish economy. In May last year, before she became prime minister, Pheu Thai leader Paetongtarn Shinawatra said the central bank's independence was an "obstacle" in resolving economic problems, underlining the scale of the friction. Vitai's stance will likely tone down some of that conflict, but it has also raised questions about his own ability to lead the central bank without succumbing to pressure from the ruling party - an issue he has publicly addressed. "I am confident that I can make decisions independently, based on principles and prioritising the nation's interests, free from the influence of any groups," Vitai wrote on his Facebook page on July 8. Vitai studied economics and law at Thailand's Chulalongkorn and Thammasat universities, and finance at Drexel University in the United States, and entered the Thai private sector, where he worked at Charoen Pokphand Group and budget carrier Nok Air. A former colleague, who worked alongside Vitai at a private firm, described him as a team player who preferred to work with consensus. "He is more of a practicalist than a theorist, focusing on getting the job done," he said, asking not to be named because he is not authorised to speak to media. In 2018, Vitai was appointed the Secretary-General of the Government Pension Fund, which manages assets worth about 1.4 trillion baht ($43 billion), and two years later became the head of the Government Savings Bank. Thirachai Phuvanatnaranubala, a former Thai finance minister, said Vitai's long experience as a government banker should help him manage relationships with senior finance ministry leadership. "However, his lack of work experience and zero exposure to high level macro public policy is a cause for concern," Thirachai told Reuters. - Reuters
Reuters
22-07-2025
- Business
- Reuters
Thai cabinet picks Vitai Ratanakorn as next central bank chief
BANGKOK, July 22 (Reuters) - Thailand's cabinet gave its approval on Tuesday for Vitai Ratanakorn to take over as the next central bank governor and revive an economy in the doldrums with limited monetary policy room to work with. The appointment of Vitai, 54, the president and CEO of the Government Savings Bank, would be subject to royal approval before he starts a five-year term on October 1. He was picked over central bank veteran and deputy governor Roong Mallikamas. Vitai would succeed Sethaput Suthiwartnarueput, who has reached retirement age. The cabinet approval for Vitai was announced by government spokesperson Jirayu Huangsap. The Bank of Thailand's next governor faces a big challenge with an economy shackled by tepid consumption, weak lending, stubbornly high household debt and steep U.S. tariffs. Vitai has a master's degree in finance from Drexel University in the United States, as well as degrees in economics and law from Thailand's Chulalongkorn and Thammasat universities. Some analysts expect his appointment to improve the working relationship of the central bank and the Pheu Thai party-led government, which has previously clashed with Sethaput over interest rates and monetary policy settings. "There should be no issue of conflict," said Natapon Khamthakrue, an analyst at Yuanta Securities. "Vitai's approach is likely to be more relaxed compared to someone from the central bank, but making significant adjustments within the central bank might not be easy due to existing regulations." However, Natapon cautioned that "there needs to be careful consideration to avoid the perception of excessive government interference". Last year, Prime Minister Paetongtarn Shinawatra, before she was premier, said central bank independence stood in the way of solving economic problems. In a social media post earlier this month, Vitai said he has acted independently and without influence from any groups in his career, prioritising the public interest. Last month, he said there was a need to cut interest rates deeply to support a stagnant economy. The central bank late last month left the key interest rate unchanged, underlining the need to save some policy ammunition after three cuts from October that brought the key rate to 1.75%, the lowest in over two years. The next rate review is August 13. Kobsidthi Silpachai, head of Capital Markets Research at Kasikornbank, said Vitai should help coordinate monetary policy with government policy. Finance Minister Pichai Chunhavajira said the same, adding the top priority should be solving Thailand's debt issues. "The most urgent and biggest issue is debt," he told reporters. "Regarding monetary policy, the central bank has independence, but it must work to support policies that align with driving the economy and government policy." Chamadanai Marknual, an economist at Krungthai Bank, said the new governor would likely uphold the central bank's independence and as an outsider, Vitai could push for more preemptive policy. "Having someone who has never worked at the central bank before may have an outside-in perspective," Chamadanai said. "There is very limited room for fiscal measures, so adopting relaxed policies might be the right answer."
