Banks promise unlimited assistance

 In a statement released yesterday, the association said the assistance would be through debt rescheduling, reduced principals, and cuts in interest rates to as low as zero.
“Yet this depends on the actual severity of the problems of each client,” it said.
The association said its members had already extended financial assistance effected a quick recovery by clients. This followed Finance Minister Thirachai Phuvanatnaranubala’s remark on Tuesday that he was disappointed that commercial lenders had ignored a government request to provide zero-interest loans to all kinds of businesses damaged by the flooding.
Kasikornbank president and chief executive officer Banthoon Lamsam said his bank was already offering zero interest in its financial relief packages to flood-affected retail customers.
However, the bank is unable to offer zero interest to all affected customers because the help is dependent on the extent to which each business has been damaged, he said.
Bangkok Bank executive vice president Charnsak Fueangfu said the bank was already offering emergency packages to ease the burden on clients.
Interest-free loans are being provided, but this help is available to retail customers only because this segment has been most heavily affected by the floods and has lower cash reserves than rich businesses, he said.
The bank is conducting urgent studies in flood-hit areas to set appropriate relief programmes for each type of customer.
While the programmes therefore differ from client to client, all banks are now focused on emergency relief packages by extending principal and interest repayment periods.
After establishing the actual damage suffered by each customer, Bangkok Bank will launch additional packages to suit their problems and requirements, Charnsak said.
“All banks must ease conditions as much as they can to help customers, but the level of damage is different. Some customers said their machines and raw materials had been damaged, but others said the machinery was safe but they could not sell their products because of transport problems,” he added.
Deja Tulananda, vice executive chairman of Bangkok Bank, said that if the Finance Ministry and the Bank of Thailand relaxed some of the lending conditions for commercial banks, believing all banks could provide interest-free credit for all kinds of customers, such a move should only be for a finite period.
“The [zero] interest is not the point … We have already waived interest for some customers and our relief packages are ready to change to deal with the situation,” he said.
Deja said Bangkok Bank had many business customers of all sizes at affected industrial estates and in 30 flood-hit provinces.
The bank expects the effect of the flooding on its non-performing loans will be seen in the next three months, he added.
Meanwhile, Krung Thai Bank yesterday launched additional relief measures, including zero interest for three months, to SME (small and medium-sized enterprise) and retail customers.
The bank already had seven measures in place to help floodaffected businesses and retail customers. However, the seriousness of the situation persuaded the bank to offer additional assistance and adjust what it was already providing, said KTB president Apisak Tantivorawong.
The additional measures are the suspension of principal and interest repayment for six months, after which customers can gradually repay the frozen interest over a maximum period of 24 months.
Apisak said the bank would waive interest repayments for three months for SME and retail customers requiring suspension of debt repayment for such a period.
KTB has adjusted some of the conditions in its original measures by extending term loans at minimum lending rate minus 1 percentage point from one year to three years, and extending the repayment period for businesses hit by the floods from five years to seven.
Customers requiring new working-capital loans will benefit from a reduced interest rate of minimum overdraft rate minus 2.5 percentage points in the first year, he added.