Specialised financial institutions (SFI) are set to hold a meeting within next week to mull passing on the Bank of Thailand's 25-basis point rate cut to consumers.
GH Bank, the state-owned mortgage lender, is expected to spearhead the rate reduction this round, while the Government Savings Bank (GSB) and the Bank for Agriculture and Agricultural Cooperatives are considering the issue internally, said a source familiar with the matter who requested anonymity.
The meeting will take place either this weekend or the coming week, with an official rate cut expected from the middle of this month, the source said.
On Wednesday, the central bank stunned the market by following the lead of other major central banks with a 25-basis-point rate cut, the first rate decrease since 2015, in an effort to boost the economy. The Monetary Policy Committee voted 5-2 to cut the benchmark rate from 1.75% to 1.5%, reversing the rate-setting panel's interest rate hike in December last year.
GSB president and chief executive Chatchai Payuhanaveechai said whether the bank will slash the rate and by how much will be clear by mid-August as the bank must first calculate financial costs.
State-run GSB was the first mover in hiking fixed deposits rates by 0.25 percentage points for fixed-deposit accounts across the board when the rate-setters raised the policy rate in December, but kept lending rates unchanged in the immediate aftermath.
He predicted commercial banks will not follow in the central bank's footsteps as their deposits costs would become higher after they earlier competed to raise deposits.
GH Bank Chatchai Sirilai said his bank always offers low-rate mortgages to support those who want their own homes.
The bank is launching a campaign at Money Expo Korat 2019 to offer a fixed 1.99% housing loan for one year with no fees for origination, mortgages and price appraisals, he said.
Mr Chatchai said after the rate cut GH Bank could lower lending interest rates to fall in line with the central bank's rate cut.