KBank links up with JBIC in soft-loan offer

The loans amount to Bt2.8 billion or 7.5 billion, and will be distributed through KBank branches.
The two-step loan package, in amounts up to 100 per cent of investment value and terms of up to seven years, is being offered at a special interest rate of 4-5 per cent per annum with zero interest for the first year, said KBank president and chief executive officer Banthoon Lamsam.
Borrowers are Thai-based Jap-anese businesses or companies owned by Japanese nationals, whose parent companies in Japan have registered capital not exceeding 1 billion. 
KBank estimates credit lines |of Bt190 million per borrower on average.
Thai businesses that purchase goods from and/or manufacture goods for Japanese operators may also qualify.
Those firms are eligible if their workplaces were flooded directly or, though not directly hit by the floods, their production processes were interrupted by raw-material shortages or snapped transport links.
About 60 per cent of the Bt2.8 billion is being made available by the JBIC, and the rest by 11 local Japanese banks: Bank of Tokyo-Mitsubishi UFJ, Hokuto Bank, Shonai Bank, Toho Bank, Hachijuni Bank, Shizuoka Bank, Bank of Kyoto, Chugoku Bank, Hiroshima Bank, Bank of Fukuoka and Higo Bank.
Last year’s floods cost the Thai economy about Bt1.3 trillion. The electronics and automotive-parts industries were hit hardest, with most of the losses in Ayutthaya and Pathum Thani provinces, where many Japanese companies are located on industrial estates.
KBank customers include 1,800 Japanese firms operating in Thailand, 300 of which suffered losses directly caused by flooding. There are 3,200 firms in Thailand whose parent companies are in Japan.
Banthoon noted that KBank previously launched measures to help business customers recover from flood damage.
These include tailored, reduced-interest, short- and long-term emergency loans; reduced-fee financial management services; and working with 19 Japanese partner banks in providing standby letters of credit, giving an urgently needed boost to the credit of flood-affected Japanese companies.
The soft-loan scheme is part of KBank’s effort to increase its share of the Japanese business market in Thailand to 18 per cent among Thai banks by the end of next year.
KBank currently partners with 19 Japanese banks, and is aiming to expand those relationships to cover all of Japan’s 47 prefectures.