* BOT to concentrate on debt restructuring, launches new scheme
* Banks’ unhealthy loans at 3.09% of complete lending end-June
* Financial coverage room restricted as key price at file low 0.50% (Provides element)
By Satawasin Staporncharnchai
BANGKOK, Aug 21 (Reuters) – Thailand’s fiscal coverage ought to play a better function to assist the financial system get better from the affect of the coronavirous pandemic, the central financial institution governor stated on Friday, with the benchmark rate of interest at a file low.
The Financial institution of Thailand (BOT) will concentrate on helping with debt restructuring, Veerathai Santiprabhob instructed reporters after the launch of a debt restructuring programme for companies.
“In such important situation, the one who’s able to stimulating the financial system is the federal government… and extra must be completed” given the extra extreme and widespread financial affect of pandemic, he stated.
The federal government has launched a 1.9 trillion baht ($60.37 billion) coronavirus response package deal. On Wednesday, it stated it might introduce extra steps to spice up tourism, jobs and consumption.
Southeast Asia’s second-largest financial system shrank 12.2% within the second quarter from a 12 months earlier, the worst contraction for the reason that 1998 Asian disaster as a result of pandemic affect.
The BOT has forecast a file contraction of 8.1% for 2020.
The BOT has left its key price unchanged at a file low of 0.50% since Could after three cuts this 12 months in order that coverage room might be used at the best time. It should subsequent evaluate coverage on Sept. 23.
It has stated banks ought to expedite debt restructuring in addition to lending to handle liquidity issues.
“Debt restructuring is of nice significance to the BOT and it have to be accelerated proactively” earlier than enterprise operators changing into non-performing loans (NPLs), Veerathai stated.
A so-called “DR BIZ” debt restructuring programme launched on Friday and because of begin subsequent month will assist some 8,400 focused companies with a mixed debt of about 1.2 trillion baht, he stated.
Final week, the BOT stated measure to assist debtors ought to regular NPLs at banks later this 12 months after rising barely to three.09% of complete lending on the finish of June. ($1 = 31.47 baht) (Reporting by Satawasin Staporncharnchai Writing by Orathai Sriring Enhancing by Ed Davies)