First of all, I would like to thank Banyong Pongpanich, CEO of Phatra Securities PCL, for sharing with us a piece of interesting information from a telephone conversation 14 years ago with a then deputy prime minister whom he did not name (maybe he knew there was no need to mention the name as we would be able to guess it).
The information was posted on Mr Banyong's Facebook page one day after the Supreme Court's Criminal Division for Political Office-Holders handed down 18-year sentences to Viroj Nualkhair, former president of the state-run Krung Thai Bank, and Suchai Jaovisidh, former chairman of the bank. It had found them guilty of malfeasance in office for extending 9.9 billion baht in loans to companies affiliated with Krisdamahanakorn which earlier were classified by the bank as non-performing debtors.
The following is an extract of the conversation 14 years ago between Mr Banyong and that unnamed deputy prime minister.
The deputy prime minister was quoted as saying: "Hey Tao [Mr Banyong's nickname], you are rich enough. It's about time you served the country. I would like you to become the president of Krung Thai Bank. Become the spearhead driving its commercial bank system to extend credit, which has been inactive for many years. Without the credit system working, there is no way the economy will recover. I have approached brother [Viroj] to become the chairman. And you will be the president – which should be a good match."
Mr Banyong recalled that he didn't hesitate to answer. "I will have to pass on this. I am not sacrificial enough and I am still selfish."
The deputy prime minister persisted. "I can offer you a 500,000 baht salary – that is the highest for a state enterprise."
"I am already getting 25 million baht a year. But that is not as important a point as the fact that I do not want to risk being jailed for working for the state, sir," replied Mr Banyong.
He then quoted the deputy prime minister as saying that he had to approach "brother" to be the president.
Looking back, Mr Banyong made the right decision. He must have realised that when a politician offers someone a favour, he must expect to return that favour.
That was what Viroj and Suchai eventually found out when they were told to return the favour by extending loans to the non-performing debtors affiliated with Krisdamahanakorn, supposedly to spur the economy. But the sad truth was, the loans went straight into the pockets of some crooks. In my view, it was a heist carried out in broad daylight, carried out with the consent of the KTB's top management, and carried out with the imprimatur of the then government.
The KTB "robbery" reminds me of the Bangkok Bank of Commerce (BBC) scandal over two decades ago when the bank's top management collaborated with a group of politicians known as the "Group of 16" to "steal" from the bank billions of baht in loans with non-existent or poor guarantees which were used for the takeover of several listed companies. Weighed down with staggering non-performing loans and uncontrollable bank runs, the bank finally went belly up.
There are, however, some striking similarities between the two scandals. Politicians were key players in undermining the two banks, although in the BBC case, an adviser to the bank president, Rakesh Saxena, was instrumental in several shady loan deals from which he himself financially benefitted.
Rakesh is currently serving a jail term in Thailand after he was extradited from Canada following a long court battle. BBC's former president Krirkkiat Jaleechandra died three years ago of cancer while serving a long jail term.
Interestingly, none of the "Group of 16" politicians were jailed or faced justice. Likewise, the "political boss" who ordered the KTB bank to extend loans to Krisdamahanakorn's affiliates remains scot-free, living in exile and on the run with his chances of voluntarily returning home as remote as ever.
There are many lessons to be learned from these two sorry bank tales for those in the government, or in the private sector, who blindly serve their crooked political masters.
Veera Prateepchaikul is a former editor, Bangkok Post.