Banks' well placed for role in aiding victims'

The flood crisis is expected to be more detrimental to the economy than external factors, and will likely affect the growth of gross domestic product, said SCB president Kannikar Chalitarporn.
However, thanks to a strong banking sector, financial institutions can offer emergency relief packages to those customers affected by the flooding without unduly worrying whether such assistance will increase non-performing loans (NPLs), she said.
To prevent a rise in NPLs, banks must ease their lending conditions for such customers and give immediate financial relief so that businesses and members of the general public can get back on their feet, she added.
SCB yesterday announced that it would make available loans of about Bt10 billion, of which Bt8 billion is earmarked for wholesale customers and Bt2 billion for SME (small and medium-sized enterprise) clients hit by the floods.
“If customers want more loans, we are ready to expand the financial package to more than Bt10 billion,” Kannikar said.
Bangkok Bank earlier announced that it would provide loans of Bt5 billion to help flood-affected customers.
About 300 SCB corporate customers at industrial estates in Ayutthaya and nearby provinces have been affected by the flooding, representing total loans of Bt15 billion to Bt20 billion. About 2,000 SME customers, representing loans of Bt17 billion, have also been hit.
The affected wholesale businesses need working-capital loans to maintain their business liquidity.
About 183 SME customers have sought additional lending totalling Bt7.54 billion to help their businesses.

CRISIS-MANAGEMENT TEAM
Kannikar said her bank had formed an executive crisis-management team and an incident-response team to monitor the flood situation. It also has a videoconference link with executives of the Bank of Thailand to establish emergency plans as part of SCB’s business-continuity plan.
SCB senior executive vice president Arthid Nanthawithaya said an important indirect impact of the flooding on the economy was the effect on supply-chain businesses located outside the flood-affected areas.
The supply chain, which is mostly composed of SMEs, is currently unable to supply materials or products to companies that have suspended production.
Upstream businesses have insurance policies that cover both damage from natural disasters and business disruption, whereas supply-chain businesses have only natural-disaster coverage, he said.