KTB not seeking new partners for ailing Saha Farm

KTB meanwhile conceded that more civil servants were overdue on their mortgage repayments, because of the country’s economic slowdown and higher living costs.

Bank president Vorapak Tanyawong said that as a major creditor of Saha Farm, which is subject to a debt-restructuring and rehabilitation plan, KTB was setting aside two credit lines for the group to continue its business. 

One line is for emergency purposes while the other, which requires negotiation with other Saha Farm creditors, is for running the business.

In response to a remark by former Constitutional Court head Wasan Sroypisut over the potential risk inherent in the state-run bank jointly extending loans to the Bt350-billion water-management project, Vorapak said he expected no problem, as loan disbursement would only take place on the basis of progress made in the mega-project.

Weidt Nuchjalearn, KTB’s first senior executive vice president, said that while there had been little impact on the bank’s personal-loan repayments from the economic slowdown and higher cost of living, there were concerns over mortgage repayments, particularly among some groups of civil servants who had been adversely affected by their high ratio of debt to income.

Amid higher risks to the Kingdom’s economic growth, the bank’s strategy for retail customers and small and medium-sized enterprises is to focus more on existing clients and have a more stringent screening process for new customers, he said. 

KTB will concentrate on low-risk customers such as doctors, lawyers and SMEs with a credit limit of no more than Bt20 million. 

Weidt added that the bank expected to expand its mortgage lending by 20 per cent for the whole of 2013, with its focus more on large developers’ projects, potential locations and a faster price-appraisal process.

KTB’s outstanding factoring loans, meanwhile, have risen from Bt5 billion at the end of last year to Bt8 billion at present. 

The bank targets this type of lending reaching Bt10 billion by year-end, said the executive.

Meanwhile, CIMB Thai Bank senior executive vice president Adisorn Sermchaiwong said the bank’s deposit costs had fallen by 50 basis points after a 25-basis-point cut in the policy interest rate to 2.5 per cent by the Bank of Thailand’s Monetary Policy Committee back in May.

For the rest of the year, CIMB expects the policy rate to remain unchanged, or possibly even be lowered slightly, on concerns over Thailand’s economic slowdown and weaker exports.