Bank credits in comfortable level: BOT
Thailand's bank credit extension has remained in a comfortable level and it has been closely monitored by the authorities, said a Bank of Thailand's official.
Songtham Pinto, director of the macro-economy department, said that bank credit is one of seven areas the Bank of Thailand is closely monitoring, to prevent spill-over risks from the euro zone crisis, aside from current account, household debt, external debt and others.
His comment followed the Bank for International Settlements' warning that loose policy poses risks for developing nations by fueling credit- and asset-price booms, complicating efforts to stabilise. In its annual report, the BIS also noted that in emerging economies, interest rates have been raised only hesitantly out of concerns about stoking further capital inflows. As a result, monetary policy in emerging-market economies may be systematically too loose. This creates risks of rising financial imbalances similar to those in advanced economies before the crisis.
"We don't ignore the BIS's concern. However, our credit grows from the consistently low base, since the Lehman Brothers crisis in 2008. So far, there has been be no reason for a concern," Songtham said.
