Thursday, December 03, 2020

Cooperatives, financial institutions mount pressure on THAI for Bt63-bn debt repayment

Jun 08. 2020
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By The Nation

Savings cooperatives and local financial institutions will work together in seeking Bt63-billion debt repayment from the bankrupt Thai Airways International (THAI), Poramate Intarachumnum, chairperson of Cooperative League of Thailand, said.

He said the national flag carrier owes Bt43 billion to 87 savings cooperatives and another Bt20 billion to local financial institutions, banks, investment funds and assurance companies. 

The two have agreed to work together in order to increase the bargaining power of local creditors, he said.

The Central Bankruptcy Court in Bangkok accepted the bankruptcy protection case filed by THAI on May 27 while the Finance Ministry has reduced its holdings to below 50 per cent, resulting in THAI losing state enterprise status. THAI's debts are estimated to be about Bt 200 billion, excluding debt owed to frequent flying air passengers.

Poramate said that cooperatives, banks, investment funds and assurance companies will appoint two sets of committees for the debt collection task.

The first committee will follow up on the rehabilitation of THAI. “We will oppose the rehab committee who have a bad record in financial matters or management ,” he said.

The second committee will seek redemption of THAI debentures. If the national carrier could repay savings cooperatives' debts within a 10-year timeframe, it would be acceptable. If debt repayment could be made at Bt4 billion a year, then it will not financially hurt 3 million members of the 87 cooperatives, he said.

The cooperative is preparing its position and will send its options for discussions with THAI as the bankruptcy court is set to open its first hearing on THAI’s rehabilitation plan on August 17, he added.

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