GSB board head stresses governance
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Pannee Sathavarodom, chairperson of the Government Savings Bank (GSB), said she aims to strengthen corporate governance at the bank and to conform to the central bank's recommendation.
The GSB’s board of directors recently agreed to reinstate the board’s authority to write off bad debts. The bank’s previous board had delegated the responsibility to bank executives.
“We just want to create checks and balances and the board’s power is authorised by the Revenue Code and the Cabinet’s resolution,” she said.
The board move, however, is encountering resistance from bank executives.
The board has also restored its authority from executives to open new branches, while the previous board had delegated this authority to the management team.
She said the board also intends to review lending procedures after the Bank of Thailand expressed its concern over the rapid lending growth, which its staff and IT system might not be able to handle.
Former finance minister Thirachai Phuvanatnaranubala had wanted the GSB to achieve sustainable growth. Deputy Finance Minister Viroon Tejapaibul said recently that he did not want state-run banks to compete with commercial banks and wanted them to provide more loans to retail borrowers.
Pannee said that loans to large firms are about 10 per cent of total outstanding loans of Bt1.3 trillion.
She said the board is reviewing the lending procedure, which should guarantee good governance.
She said the current board did not want to centralise power, but it needs to put in place clear rules on lending and rules regarding delegation of power by the board to executives or from executive to middle managers. Investment rules are also under review by the board, she said.
Pannee is former director-general of the Fiscal Policy Office of the Finance Ministry and her term at GSB will end this November. Also, the employment contract of Lersak Chuladesa, chief executive and president of the GSB, would end this July.
