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| • EXCH RATES |
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Baht/$ 34.95/10 (Bid/Ask)
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GOLD |
12,250
+ 150
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BANKING
SOMRUEDI BANCHONGDUANG
Foreign banks are tightening their credit card requirements in light of growing credit risk amid the global economic slowdown.
Wichit Phayahanaveechai, the head of personal finance services at HSBC in Thailand, said the bank had increased its minimum salary requirement for new card applicants to 18,000 baht per month from 15,000 since October.
He said the adjustment was a local policy shift, not a global one.
''We have to prepare for the negative market outlook. Maintaining asset quality is critical for financial institutions in a down market,'' Mr Wichit said.
The change affects not only the bank's general cards, but also premium gold and platinum cards. The bank is also shifting its focus more toward the upper end of the market, where purchasing power and debt-servicing capability remain strong.
The Bank of Thailand imposes a minimum salary requirement of 15,000 baht per month for cardholders, although issuers are free to set higher limits on their own.
United Overseas Bank, for instance, on Friday raised its salary requirement to 20,000 baht per month for new cardholders. A UOB spokesman said the tighter lending standard was in line with the bank's risk-management practices.
But Citibank, one of the largest foreign bank card issuers, and large Thai banks have yet to change their criteria, although bankers say greater caution was to be expected considering the slowing economy.
Thawatchai Thitisakdiskul, a senior executive vice-president of Krungthai Card, the largest local card issuer, said the company had no policy yet to adjust its lending criteria.
''But we do have to scrutinise new card applications more due to the local and global economic slowdown,'' he said.
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