No conclusion yet on repayment period: TBA
The period to clear the Financial Institutions Development Fund's debt remains uncertain, as long as state-owned banks are left out, said Thai Bankers' Association Secretary General Twatchai Yongkittikul.
Referring to the discussion with Bank of Thailand on Feb 2, he said that the topic was on the period of debt repayment. Yet, there was no conclusion yet, as more deposits would go to state-owned banks which not need to pay deposit surcharges. That would consequently affect commercial banks' deposit base and all assumptions.
"There was no conclusion as collection may not meet the target, if the deposit base does not expand as expected. In the past two years, some deposits have moved to state-owned banks. Government Savings Bank saw its deposit base expand by Bt300 billion in the period. This may prevent the possibility that the FIDF's debt would be cleared in 25 years as planned. This matter must be explained to the Finance Ministry," he said.
The Finance Ministry is allowing the central bank to raise deposit surcharges on commercial banks, to help repay the FIDF's Bt1.14 trillion debt. It remains unclear how much they will have to pay, above 0.4 per cent of deposits currently paid to the Deposit Protection Agency. State-owned banks are exempted from all fees, on assumption that their deposits win full government guarantee.
