Thai banks' risks heighten on slow economic recovery: TBA
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Thai bankers have conceded that the slow economic recovery is heightening their lending risks, following the increasing volume of debt defaults.
"The economic slowdown results in more risks, but they remain manageable," said Boontuck Wungcharoen, chairman of the Thai Bankers' Association.
They discussed the situation at the meeting with Bank of Thailand Governor Prasarn Trairatvorakul today, with the focus on lending to small and medium-sized enterprises (SMEs).
Thai banks' outstanding loans to about 1 million SMEs are tuned at over Bt4 trillion. The banks have vowed to further help shore up SMEs' liquidity.
A greater access to finance is one of five 5-year strategies of the assocition. Unveiled today, the strategies cover five areas - electronic payment system, code of conduct, regional transactions, access to finance and enactment of related laws.
Boontuck said at a press conference that the electronic payment system would boost Thai economic competitiveness, given that cash management is costing Thailand about Bt90 billion per annum. Electronic payments will rise to 60-70 per cent within 2020, from 30 per cent at present.
On regional transactions, Thai banks are convinced that the regional payment system is urgently needed to facilitate the Asean Economic Community (AEC). This will support Thai SMEs' expansion into neighbouring countries.
