Major Economic Issues For Thailand

Local Hua Hin and regional Thailand news articles and discussion.
Post Reply
User avatar
dozer
Ace
Ace
Posts: 1329
Joined: Fri Oct 08, 2010 1:05 pm
Location: Hua Hin

Nonperforming loans up as profits slump

Post by dozer »

http://asia.nikkei.com/Business/AC/Nonp ... fits-slump

BANGKOK -- More than a year after the May 2014 military coup, Thailand's top four commercial banks continue to see declining profit growth and rising nonperforming loans (NPLs).
In the first half of 2015, Bangkok Bank, Krung Thai Bank, Siam Commercial Bank and Kasikornbank reported just over 84 billion baht ($2.5 billion) in net profits -- 1.6% less than the same period last year.
NPLs have meanwhile continued to rise at all four, reaching a total of nearly 210 billion baht at the end of June, a 15.5% year-to-date increase.
Difficulties servicing debt are not confined to small and medium enterprises, with some larger companies showing signs of debt stress.
"Given the slow pace of growth of the Thai economy, most of the customer segments saw an increase in NPLs," Siam Commercial Bank said in a statement. Anticipating further exposure, the bank has set aside over 5.1 billion baht of impairment and loan loss provisions for the second quarter of 2015, up nearly 60% year on year. "This additional provision will provide a cushion against further asset quality deterioration in the current weak economic climate," the bank said.
"Banks have been restructuring debts and extending grace periods, but this is only delaying the impact," said Tarisa Chaisuntornyotin, an analyst at KK Trade Securities.
Weerapat Wonk-urai, a banking analyst at CIMB Securities (Thailand), expects NPLs to continue rising in the second half of the year, especially among small and medium businesses involved with exports, domestic consumption and agriculture.
Lending has remained weak. Total loans at the four banks amounted to 7.152 trillion baht at the end of June, only 1.6% up from 2014.
"Businesses postponed new investment until clear signs of an economic turnaround become evident," Bangkok Bank said in a press release. The bank's total lending at the end of June was 1.789 trillion baht, a year-to-date rise of just 0.4%.
Share prices for all four banks have fallen by double digits in the first half of the year, performing worse than the Stock Exchange of Thailand index drop of 5.45%. Fourth-ranking Kasikornbank is the biggest loser having shed nearly 24%.
Analysts say share prices have yet to bottom out, and the economic outlook remains unclear. A planned cabinet reshuffle may also delay some large infrastructure projects that are already behind schedule, said Tarisa.
Exports remain sluggish. Official data released on Monday showed exports in the first half were down 4.48% year on year to 106.8 billion baht. This has been attributed to falling commodity prices and slower than expected global economic recovery. In June, exports were down 7.87% year on year, the biggest drop since December 2011.

More positively for banks, Tarisa notes that sluggish economic conditions can spur mergers and acquisitions. Even so, lending expansion may be limited if companies take advantage of low interest rates to procure funds through issuing debentures. The Bank of Thailand has already lowered interest rates twice this year.
Atheists have no need of a god. Our lives are not based on fear or guilt. We are moral because we know it's right.

Never attribute to malice that which can be explained by stupidity. R J Hanlon
User avatar
JamesWest
Ace
Ace
Posts: 1155
Joined: Mon Jan 27, 2014 2:23 am
Location: Khao Takiap, Hua Hin

Re: Nonperforming loans up as profits slump

Post by JamesWest »

yeah that 60 month loan on that pickup truck is not going to get paid off.

i am waiting for condo prices to crash.

i have been to this party a few times already in the USA. party on Thailand...
I really like this forum because there are no personal attacks. All the members contribute in a positive way to my posts.
User avatar
buksida
Moderator
Moderator
Posts: 22878
Joined: Tue Dec 31, 2002 12:25 pm
Location: south of sanity

Major Economic Issues For Thailand

Post by buksida »

This usually happens after a prolonged period of military rule - they are soldiers, not economists or diplomats and the economy goes to shit.

Economic issues for new Thai government
As of press time, political parties from both sides are racing to sign up coalition partners. After the much-awaited general election, finally, there are signs that Thailand may soon have a new government.

Regardless of whichever political camp manages to form the government, it will face a difficult task to boost the Thai economy amid the internal and external challenges. Here are some of the issues that the economic team of the new government would have to pay special attention to.

Export slump
First, weaker-than-expected Thai export growth is now a biggest concern of local business. The export sector has been a main engine driving the country’s economic growth. However, the prospects of Thai outbound shipments this year are not positive.

External factors
The new government would have to deal with international geopolitical issues which may directly impact the domestic economic performance. For example, there is a chance that Thailand may be added to the United States watch list on currency manipulation because of a high current account surplus.

Low consumer confidence
Thai consumer confidence has not fully come back in spite of the general election in March 24. Worse, the post-election atmosphere does not improve the overall consumer sentiment. Last month, Thailand’s consumer confidence index was down to the lowest level in 16 months as people were worried that the general election has done little to fix deep polarization in Thai politics.

Full story: https://www.thaipbsworld.com/economic-i ... overnment/


Thought: Exports are not helped by an over inflated local currency, external factors are not helped by the junta sucking up to the Chinese and shunning the West, and consumer confidence will not improve when household debt is at record levels and fake elections are held ... Economics 101
Who is the happier man, he who has braved the storm of life and lived or he who has stayed securely on shore and merely existed? - Hunter S Thompson
User avatar
buksida
Moderator
Moderator
Posts: 22878
Joined: Tue Dec 31, 2002 12:25 pm
Location: south of sanity

Re: Economic issues for new Thai government

Post by buksida »

Uncertainty over new government stability dampens economic outlook
Although investors have somewhat eased their worries about the local politics, the question over stability of the new government continues to dampen economic outlook, according to a research by the Siam Commercial Bank’s Economic Intelligence Center.

On June 5, Prime Minister Prayut Chan-o-cha was elected as Thailand’s next prime minister in a joint upper and lower house parliamentary vote, bringing more clarity to the local political scene.

However, the SCB’s EIC said that the new government will face difficulty in balancing the interest of each coalition party which made different promises to their voters. Moreover, the numbers of the MPs of the government and opposition camps are too close, raising the question over the longevity of the new government.

https://www.thaipbsworld.com/uncertaint ... -scbs-eic/
Who is the happier man, he who has braved the storm of life and lived or he who has stayed securely on shore and merely existed? - Hunter S Thompson
HHTel
Hero
Hero
Posts: 10878
Joined: Mon Feb 12, 2007 7:44 pm

Re: Economic issues for new Thai government

Post by HHTel »

"It'll all end in tears!" as my mum used to say.
User avatar
buksida
Moderator
Moderator
Posts: 22878
Joined: Tue Dec 31, 2002 12:25 pm
Location: south of sanity

Re: Economic issues for new Thai government

Post by buksida »

Those spending GBP here are praying for that at least ... :duck:
Who is the happier man, he who has braved the storm of life and lived or he who has stayed securely on shore and merely existed? - Hunter S Thompson
User avatar
buksida
Moderator
Moderator
Posts: 22878
Joined: Tue Dec 31, 2002 12:25 pm
Location: south of sanity

Re: Economic issues for new Thai government

Post by buksida »

Citing post-election uncertainty, World Bank sees Thai economy sputtering
Growth in the Thai economy is projected to fall from 4.1 per cent last year to 3.5 per cent this year, according to a World Bank report released on Monday.
The Thailand Economic Monitor noted that exports contracted by 4 per cent in the first quarter of 2019 – the first quarterly contraction in three years.

Private investment and household consumption continued to grow close to their three-year high, helped by low inflation, increasing employment and rising recurrent fiscal spending. At the same time, public investment weakened as the implementation of “megaprojects” slowed due to election-related delays.

As a result, the economy’s pace of expansion slowed to 2.8 per cent in the first quarter of 2019, falling below 3 per cent for the first time since mid-2015. The World Bank projects growth to gradually increase from the expected 3.5 per cent in 2019 to 3.6 and 3.7 in 2020 and 2021, assuming private consumption can be sustained and public investment accelerates.
bankwolrd08JULY.jpg
bankwolrd08JULY.jpg (66 KiB) Viewed 37193 times

http://www.nationthailand.com/business/30372557
Who is the happier man, he who has braved the storm of life and lived or he who has stayed securely on shore and merely existed? - Hunter S Thompson
User avatar
buksida
Moderator
Moderator
Posts: 22878
Joined: Tue Dec 31, 2002 12:25 pm
Location: south of sanity

Re: Economic issues for new Thai government

Post by buksida »

Thailand’s second quarter growth rate lowest in 19 quarters
Thailand’s economic growth rate for the second quarter of this year registered at 2.3%, compared to 2.8% for the first quarter, which is the lowest in 19 quarters, said Mr. Tossaporn Sirisamphan, secretary-general of the National Economic and Social Development Board (NESDB), Thailand’s economic think-tank.

Although the Thai economy is not yet in a critical condition, he warned that something must be done quickly by the government, otherwise the economic situation will get worse.

Commenting on the over 300 billion baht economic stimulus package, approved by the cabinet last week, Mr. Tossaporn said that Thai exports for the second half of the year must expand by at least 3% and tourist arrivals must exceed 20 million, or revenue from tourism must be 2.4 trillion baht, while private investment must increase at least 2.9% in order to reverse the economic slowdown during the third and fourth quarters.

He blamed Thailand’s economic slowdown during the first half of this year to global economic fluctuations, global financial instability, the trade war between the United States and China and the domestic political situation.

https://www.thaipbsworld.com/thailands- ... -quarters/
Who is the happier man, he who has braved the storm of life and lived or he who has stayed securely on shore and merely existed? - Hunter S Thompson
User avatar
buksida
Moderator
Moderator
Posts: 22878
Joined: Tue Dec 31, 2002 12:25 pm
Location: south of sanity

Re: Economic issues for new Thai government

Post by buksida »

Economy slowing but not in recession yet
The economy is just slowing but not in a recession yet and recently announced government stimulus measures should help lift growth to 3% this year, Finance Minister Uttama Savanayana said on Wednesday.

Southeast Asia's second-largest economy expanded only 2.3% in the second quarter, the weakest annual pace in nearly five years, as its exports, a key growth driver, tumbled amid rising trade tensions and a strong currency. The baht is the best performing currency in Asia, up 6.4% against the dollar so far this year.

The government last month announced the 316-billion-baht stimulus package that will include support for farmers and tourism in a bid to boost domestic activity.

https://www.bangkokpost.com/business/17 ... yet-uttama
Who is the happier man, he who has braved the storm of life and lived or he who has stayed securely on shore and merely existed? - Hunter S Thompson
User avatar
buksida
Moderator
Moderator
Posts: 22878
Joined: Tue Dec 31, 2002 12:25 pm
Location: south of sanity

Re: Economic issues for new Thai government

Post by buksida »

THAILAND’S 2020 EXPORTS EXPECTED TO SHRINK UP TO 2.4%
Thai exports this year is expected to shrink by 0.9-2.4 percent this year, said a Bangkok academic institution on Tuesday in a news briefing.

Further more, our assessments indicate that Thailand would export 244.23 billion U.S. dollars’ worth of goods in 2020, with the Thai baht appreciating to a six-year high, said Aat Pisanwanich, director of the University of the Thai Chamber of Commerce’s (UTCC) Center for International Trade Studies.

The director also noted that the strong baht, the U.S.-Iran tension and the slowdown in global economy will have direct impacts on Thailand’s exports.

http://www.khaosodenglish.com/news/busi ... up-to-2-4/
Who is the happier man, he who has braved the storm of life and lived or he who has stayed securely on shore and merely existed? - Hunter S Thompson
User avatar
buksida
Moderator
Moderator
Posts: 22878
Joined: Tue Dec 31, 2002 12:25 pm
Location: south of sanity

Re: Major Economic Issues For New Thai Government

Post by buksida »

2019’S THAI ECONOMY GROWTH LOWER THAN EXPECTED

Thailand’s economy grew by 2.4 percent in 2019, lower than the previous estimate of 2.6 percent, said the National Economic and Social Development Council (NESDC) on Monday.

According to the NESDC, which plans Thailand’s national economic strategies, gross domestic product in the fourth quarter of 2019 expanded by 1.6 percent year on year, decelerating from 2.6 percent in the third quarter of 2019.

The deceleration is a consequence of drop in exports, government final consumption expenditure and public investment, the NESDC explained.

On the production side, the agricultural sector dropped by 1.6 percent, compared to a rise of 2.7 percent in the third quarter in 2019.

Non-agricultural sector increased by 2 percent, slowing down from 2.5 percent in the third quater of last year, as a result in the drop of the manufacturing sector by 2.3 percent.

The NESDC has also adjusted down its growth estimate for 2020 from 2.7-3.7 percent to 1.5-2.5 percent.

https://www.khaosodenglish.com/news/bus ... -expected/
Who is the happier man, he who has braved the storm of life and lived or he who has stayed securely on shore and merely existed? - Hunter S Thompson
User avatar
buksida
Moderator
Moderator
Posts: 22878
Joined: Tue Dec 31, 2002 12:25 pm
Location: south of sanity

Re: Major Economic Issues For Thai Government

Post by buksida »

BOT said Thailand could go into a recession of 8.1 per cent in 2020
The Bank of Thailand (BOT) has lowered its GDP projection for 2020 down from a contraction of 5.3 per cent to a recession of 8.1 per cent on Wednesday.

The Monetary Policy Committee (MPC) has also decided to maintain the policy interest rate as expected.

Titanun Mallikamas, BOT’s Assistant Governor, said all seven members of the MPC voted unanimously to maintain the country’s benchmark lending rate at 0.5 per cent.

The central bank has already cut the rate three times in the first half of 2020 from 1.25 per cent at the beginning of the year to the current unprecedented low level to support the economy during the coronavirus outbreak.

“The MPC assessed that the Thai economy in 2020 has the potential to contract more than previously estimated as the impact from the outbreak of COVID-19 is more severe than expected,” he said.

https://www.thaienquirer.com/14859/bot- ... t-in-2020/
Who is the happier man, he who has braved the storm of life and lived or he who has stayed securely on shore and merely existed? - Hunter S Thompson
PET
Legend
Legend
Posts: 2147
Joined: Mon Jun 25, 2007 4:24 pm
Location: Hua Hin

Re: Major Economic Issues For Thai Government

Post by PET »

The Thai problem is no different to most other countries. Health vs Economy
Courage is grace under pressure and when circumstances change you change your mind.
handdrummer
Addict
Addict
Posts: 5389
Joined: Mon Mar 03, 2014 11:58 am

Re: Major Economic Issues For Thai Government

Post by handdrummer »

PET wrote: Sun Jun 28, 2020 7:52 am The Thai problem is no different to most other countries. Health vs Economy
As in other economies, the wealthy are relatively unaffected by the economy and can easily afford health care. The real problem, as always, is the disparity between the rich and the poor and no govt. can fix that, with the exception that, the govt. has the ability to make everyone poor but make everyone rich.
Suua
Specialist
Specialist
Posts: 137
Joined: Mon Sep 23, 2019 9:44 pm

Re: Major Economic Issues For Thai Government

Post by Suua »

The only difference between this country and the world is that it has the biggest discrepancy between rich and poor in the world.
Post Reply