GSB raises bad loan provisions by B50bn

GSB raises bad loan provisions by B50bn

Government Savings Bank (GSB) aims to set aside an additional 50 billion baht in provisions against a potential increase in bad loans after the debt relief measures end, says new president and chief executive Vitai Ratanakorn.

Before the debt holiday scheme started, the state-owned bank had 300,000 accounts with total loans outstanding of 70 billion baht overdue, and another 400,000 accounts with 65 billion that turned sour, he said.

The bank did not specify a time frame for putting aside the 50 billion baht in loan-loss provisions.

GSB must take special care of overdue loans, setting aside loan-loss reserves for the 65 billion baht in sour loans, although it is the bank's responsibility to recover these non-performing loans (NPLs), said Mr Vitai.

Mr Vitai replaced Chatchai Payuhanaveechai, whose tenure expired at the end of June.

GSB's NPL ratio stood at 2.88% at the end of May. For the first five months, the bank's net profit amounted to 5 billion baht, with total lending increasing 5.6 billion to 2.16 trillion baht.

Mr Vitai said GSB under his helm will adjust its role towards social banking, acting as the country's main pillar in narrowing social disparity and taking care of grassroots people through lending and other services. Future projects must focus on outcome rather than image and the bank's profit must not fall after implementing such schemes, he said.

The bank will strengthen the digital area, further developing Mymo to offer identity authentication and contracts, as well as credit bureau checks via mobile apps to reduce the workload of branch employees and save customer time.

GSB also plans to cut unnecessary budget for ads and marketing events, said Mr Vitai.

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