The rate at which hotel business operators have been joining the Bank of Thailand's (BoT) asset warehousing programme -- a debt relief measure -- has been easing due to an improvement in domestic tourism following the country's reopening, said an executive at the central bank.
A total of 168 hotel business owners applied for the central bank's asset warehousing scheme, accounting for total asset value of 24.37 billion baht, as of Nov 8 this year. The figure reflects a marginal increase from 106 operators, with total asset value of around 15 billion baht, in September.
The BoT's senior director, Suwannee Jatsadasak, said hotel business operators have resumed their operations and their occupancy rate has been improving. After the country's reopening on Nov 1, economic activities, consumption and domestic tourism have all been picking up.
With this, some hotel business operators cancelled their applications to join the asset warehousing scheme, she added.
The creditors and borrowers entering the BoT's asset warehousing scheme need to take more time amid complicated processes regarding ownership rights over the transferred assets. As a result, the debt restructuring programme has progressed gradually compared with the fast progress of the central bank's soft loan scheme.
As of Nov 8, 39,095 business operators had secured soft loan approvals worth a total of 124.83 billion baht.
The BoT's hotel business operator sentiment index last month found that 67% of the respondents had resumed the reopening of their business, a significant increase from 51% in September. Meanwhile, the hotel occupancy rate nationwide increased to 23.5% on average in October, compared to 15.5% in the previous month.
With an uneven economic recovery, the central bank sees tourism-related industries such as hotels, transportation and property as fragile sectors which will take longer to recover.
In a related matter, Ms Suwannee said the central bank has been monitoring mortgage loan demand after the BoT's easing of the loan-to-value (LTV) ratio for mortgage lending.
This temporary relaxation, which is effective from Oct 20 this year until the end of 2022, allows banks to approve housing loans for borrowers of up to 100% of the total home value for all types of mortgage loan contracts.
The central bank expects housing loan demand to gradually improve by the end of this year in line with rising economic trends and seasonal factors in the final quarter of the year.
Although the LTV rule has been relaxed, financial institutions are expected to maintain strong criteria on housing loan approvals in accordance with the rising credit risk of borrowers. On mortgage loan analysis, the financial institutions need to consider the debt service ratio in line with borrowers' debt repayment capabilities, said Ms Suwannee.
According to the BoT's data, the overall commercial banking sector's outstanding mortgage loans in the third quarter of this year showed a positive growth rate of 5.7% year-on-year, despite declining from 6.8% in the previous quarter. The non-performing housing loan ratio was 3.62% in the third quarter, down from 3.66% in the second quarter.