GH Bank to lend B20bn to aid elderly

GH Bank to lend B20bn to aid elderly

GH Bank is set to offer 20 billion baht in loans for pre-financing and mortgages to help the elderly, the bank's chief says.

Half of the total will go towards pre-financing to develop residences for elderly people, said president Chatchai Sirilai, noting that the bank has begun discussions regarding pre-financing credit with property developers and the National Housing Authority.

"Next year we will focus on supporting the development of homes for the elderly," he said. "GH Bank will provide loans to both property developers and the general public. The loan amount of 20 billion baht has not taken reverse mortgages into account, as the bank can only start offering reverse mortgage services after the law is amended. That issue is currently being considered by the Finance Ministry."

Regarding progress on loans for those taking care of their parents, Mr Chatchai said around 1 billion baht out of the 20-billion total has already been lent.

The lending amount is still marginal, as homeowners have shown more interest in the bank's 63rd anniversary housing loan package, he said.

The bank's 2016 new-loan target of 170 billion baht appears reachable as the bank had extended 151 billion baht in loans as of Dec 13.

For non-performing loans (NPLs), the state-owned bank is forecast to cut its bad loan ratio to 5.2% by year-end, thanks largely to debt restructuring, he said. GH Bank had previously aimed to bring down its NPL ratio to 5.25% by the end of 2016.

The bank is restructuring debt worth 3 billion baht and borrowers who owe an additional 3 billion are expected to restructure their debt with the bank soon he said, thus reducing the size of its bad debt disposal to 8 billion from the Finance Ministry's approved amount of 14 billion.

After the 8-billion-baht NPL divestment next year, GH Bank's bad loan ratio will be cut by 1.2 percentage points and its target to reduce the ratio to below 4% in the next four years will be achievable, said Mr Chatchai.

He estimated that GH Bank will obtain 4-5 billion baht from selling NPLs worth 8 billion, which is expected to be divided into batches worth 1 billion each to allow small investors to buy the assets.

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