Banks never told to slash debts, says central bank
The Bank of Thailand (BOT) announced on Monday that it had not instructed commercial banks and financial institutions to slash the amount owed by debtors, but to instead restructure debts.
BOT issued the statement after the Thai Bankers Association (TBA) voiced concerns over a circular issued by the central bank asking commercial banks and financial institutions to help debtors.
Suwannee Jesadasak, BOT’s senior director, said the restructuring of debts depends on the agreement between creditors and debtors, so they cannot instruct commercial banks and financial institutions to cut debts.
She added that TBA may have misunderstood after BOT’s announcement was reported by media last week but added that the central bank has discussed the issue with TBA.
“We are not calling on commercial banks and financial institutions to trim debts, but instead are asking them to use financial tools to help debtors facing difficulties,” she said.
She said banks can help debtors by reducing instalments, changing loan terms, granting additional loans or relieving their debt burden.