Ad hoc banking crisis team forming

Ad hoc banking crisis team forming

Financial institutions make outreach effort

Banks are setting up an ad hoc team for banking crisis management to monitor the surge in infections and allow the provision of uninterrupted financial services.

Kobsak Duangdee, secretary-general of the Thai Bankers' Association (TBA), said financial institutions, including commercial banks, foreign banks with a local presence and specialised financial institutions, have collaborated to set up a banking crisis management team to monitor overall banking services and operations as local infections surge.

This ad hoc team will mainly focus on banking services, logistics and communication, offering financial services to all customer segments via both offline and online channels, said Mr Kobsak. The team plans to communicate with clients to avoid misunderstandings.

He said the TBA talked with the Bank of Thailand in preparation for a new outbreak of infections.

Commercial banks are operating under a business continuity plan. Management details depend on the risk management strategy of each commercial bank, with an emphasis on the safety of all parties, including customers, staff and business partners.

The central bank and TBA also discussed updating the debt repayment status of all customer segments, including individual borrowers, small and medium-sized enterprises and corporates.

"Banks will need more time to analyse customers' ability for debt repayment given the new outbreak. An analysis of the non-performing loan outlook of the commercial banking sector is also necessary," said Mr Kobsak.

"Such assessment depends on government measures to contain the outbreak as well."

Further monitoring is necessary, even as the majority of debtors, both retail and commercial borrowers, have managed to exit from the central bank's debt relief measures and have resumed servicing debts normally, he said.

It is too early to predict whether existing clients who applied for debt relief measures will need additional financial assistance, said Mr Kobsak.

After the central bank's debt relief measures ended on Oct 22, 66% of corporate debtors managed to exit the programme, 32% continue to receive financial assistance and 2% could not be contacted by financial institutions.

For retail loans, 70% of corporate debtors exited the programme, 29% continued to participate in the programme and 1% could not be contacted.

State-owned Government Savings Bank (GSB) on Thursday rolled out a measure to help affected customers living in the 28 provinces designated as red zones that have several restrictions imposed.

Some 1.9 million GSB customers, whose combined loans are worth around 670 billion baht, are allowed to apply for principal repayment suspension and reduction of loan interest starting today. The measures span 3-6 months. The bank plans to assess customers' requests depending on the scale of impact they have endured during the crisis.

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