State-owned GH Bank's savings certificate, with a ticket price of 1 million baht each, is expected to be oversubscribed by up to 85%.
The 27-billion-baht savings lottery Wimarnmek has already been oversubscribed and the reservation amount is estimated to reach 40-50 billion baht after the subscription period ends on Aug 15, said GH Bank president Chatchai Sirilai.
With the huge demand, the bank plans to make a random selection on Aug 19 of the prize-linked savings' buyers, he said. Those who fail to subscribe will be entitled to purchase the bank's new batch of savings certificates worth an estimated 10-20 billion baht.
The new lot of GH Bank's savings lottery, dubbed Wimarnmek 2, is expected to be sold later this year.
Mr Chatchai said Wimarnmek's savings certificate offers 1.4% per year to those who hold it until maturity at three years.
It charges a mere 1% of the 1-million-baht ticket price or 10,000 baht for early withdrawal after holding it for less than three months.
The bank's savings certificate holders are not subject to a charge for early withdrawal after holding money from three months to one year. Those who redeem the certificate after holding it for one year but less than three years are entitled to a 1% interest rate per year.
GH Bank's prize is set at a flat 200,000 baht, with 27 prizes per month. Throughout three years, there are a total 927 prizes and probability of winning a prize is 0.1%.
Mr Chatchai said the likelihood its savings certificate holders will win a prize is 0.1%, well above the odds of winning the top prize in state lotteries, which is 0.0001%.
Proceeds from the savings certificate will be used for mortgage lending with a fixed interest rate in the range of 2.5-2.75% per year.
Savings certificate issuance allows the bank to have longer term funding source but lower costs, he said.