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https://www.nationthailand.com/pr-news/business/banking-finance/40022518

Thai capital market and its role in development

MONDAY, NOVEMBER 28, 2022

The Thai capital market is still the main lever that drives sustainable development in the country and pushes its competitiveness in the Asean region, a study by the Capital Market Development Fund (CMDF) and Mckinsey & Company shows.

CMDF and McKinsey & Company (Thailand) Co. Ltd., a global management consulting firm has introduced a white paper report on “Improving Thailand’s Capital Market Competitiveness and Efficiency”.

They studied the opportunities and limitations of the Thai capital market structure in terms of competitiveness and efficiency to cope with changing trends and challenges in the areas of technology, economy, society and environment, both nationally and globally.

CMDF is a unit under the Securities and Exchange Act B.E. 2535, aimed at promoting the development of the capital market, organizations, and infrastructure.

The Thai capital market is also a source of long-term funding that promotes economic development and innovation, in addition to being a source of knowledge in savings and investment. 

The Thai capital market benefits the country in many ways, whether it is helping people who are transitioning into an ageing society to have savings for retirement or creating an environment that is conducive to startups and small and medium businesses (SMEs). 

However, the cost of doing business in certain types of capital markets, such as the cost of trading shares in the secondary market (with the current cost being the second highest in Asean, calculated by excluding Financial Transaction Tax that may apply) or mutual funds is still higher than the Asean average. 
As a result, the Thai capital market must adapt in order to compete with more cost efficiency. Moreover, this report provides 10 additional policy proposals for the sustainable development of the Thai capital market in the future as follows:

(i) Promote sustainable financing to help Thailand move towards Net-zero carbon emissions by advocating for Green Finance innovation in the Thai capital market.

(ii) Develop a pension fund to support an ageing society by supporting the development of the National Pension Fund.

(iii) Promote small and medium enterprises (SMEs / startups) through funding, consulting, platform creation and fundraising agreements.

(iv) Expand digital assets. Various applications should be explored and confidence in risk management should be developed.

(v) Improve financial literacy through the cooperation between public and private sectors, new types of investment projects and by promoting awareness of investing from an early age.

(vi) Promote retail investor investments: Reduce the complexities of starting out in investing. Adopt digital technologies to increase the number of retail investors in the Thai capital market.

(vii) Attract long-term investments from foreign institutional investors: Create a more open environment that is on par with regional leaders and has infrastructure to support new economic sectors.

(viii) Develop domestic institutional investors: Strengthen domestic institutional investors by diversifying investments into a wider variety of assets.

(ix) Unlock data analytics: By investing in data standardization and collecting data resources for investment.

(x) Attract and nurture talent: By attracting personnel with in-demand skills into the Thai capital market and upgrading personnel in the current Thai capital market to have the expected skills.

Developing the Thai capital market according to this approach, while maintaining cost competitiveness can help the Thai capital market to build on the success of the past and create a Thai capital market that can meet the needs of a new generation. 

However, successfully creating Thailand’s capital market of the future will require committed support and cooperation from all stakeholders in the public and private sectors.

The detailed white paper report can be downloaded from the website www.mckinsey.com/featured-insights/.

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https://www.nationthailand.com/business/banking-finance/40021938

Opt for non-capital market assets, KBank Private Banking advises investors

THURSDAY, NOVEMBER 10, 2022

Nongluck Ajanapanya

KBank Private Banking, Kasikornbank’s wealth management arm, has advised affluent Thai investors to focus on alternative assets as the global economy enters a recession.

Speaking exclusively to a group of media, KBank’s senior managing director, Private Banking Business Head Triphon Phumiwasana, said that alternative assets with diversified portfolio risks would help increase opportunities for returns amid current uncertainties.

He noted that the capital market has been extremely volatile throughout 2022, resulting in sharp drops in returns across almost all major asset classes and a 20% drop in MSCI World.

“This year also marks the third time in 30 years that both equities and bonds have delivered negative returns, and the first time that both asset classes’ returns have declined by as much as 20%,” Triphon said. “As a result, KBank Private Banking suggests diversifying into non-capital-market assets to reduce portfolio volatility while increasing opportunities for returns.”

Meanwhile, according to the most recent Lombard Odier report, market volatility leading to negative returns on portfolios is the top concern for Thai high-net-worth individuals. Over 50% have repositioned their portfolio with the help of their bank, and nearly 30% plan to increase allocation to alternative investments in the near future.

The bank recommends six alternative assets, highlighting outstanding year-to-date returns: quantitative hedge funds, private equities, global private real estate, Thai private real estate, private credit funds, and structured notes.

These alternative assets offer average returns of 8% or higher.

Triphon cautioned that while alternative investments are becoming increasingly important in increasing returns opportunities during this period of high inflation and economic recession, investors must work hard to understand the assets as well as the market landscape.

KBank Private Banking provides international comprehensive wealth management services to Kasikornbank customers with assets under management of 50 million baht or more. The service covers all aspects of preserving, growing, and passing on wealth, and all asset types from financial assets, family businesses, real estate, and others.

Nongluck Ajanapanya

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https://www.nationthailand.com/business/banking-finance/40021705

EXIM Bank widens its role beyond lending to help SMEs tap global market

THURSDAY, NOVEMBER 03, 2022

Nongluck Ajanapanya

The Export-Import Bank of Thailand (EXIM Thailand) has announced a new strategy to assist the country’s small and medium-sized enterprises (SMEs) in entering the global market.

The bank will also assist Thai companies and investors in entering the Bio-Circular-Green (BCG) industry.

Rak Vorrakitpokatorn, president of EXIM Thailand, stated at the launch ceremony on Wednesday that the bank cannot function only as a funding source in order to sustain its growth.

They must be business partners, take the initiative to assume risk, and foster entrepreneurs who are prepared to export, Rak stated.

He revealed three new tools of the bank that would help nurture the country’s SMEs.

The first is a one-stop education service that offers incubation, training, and complete financial support. As a result, SMEs and community enterprises will be able to establish themselves on the global stage.

The second service is to create investment opportunities for medium-sized entrepreneurs, dubbed Amazing M, to invest abroad in order to establish a manufacturing base, expand trade networks, and become a part of the global supply chain.

The third service is to assist Thai entrepreneurs in adopting the BCG model so that their businesses can emit low or zero-carbon emissions.

“The new strategy will give us a clearer role in taking risks, spawning a new industry, and assisting Thai capital to go abroad,” Rak said.

The bank’s action was precipitated by its realisation of the major problem faced by Thai businesspeople who lack the confidence to export or pursue new opportunities abroad.

Finance Minister Arkhom Termpittayapaisith (center)

Finance Minister Arkhom Termpittayapaisith praised EXIM Bank for taking the initiative at a time when Thailand’s economy is showing signs of improvement. The country’s economy is expected to grow this year by 3.4%, with exports increasing by 8.1%.

He stated that Thailand must now rapidly develop entrepreneurship DNA that is not afraid to face the world and is prepared to compete with insight knowledge and deep digital skills.

EXIM Thailand had a new credit facility of 51.243 billion baht at the end of the third quarter of 2022, a 32.84% increase over the same period last year. SME entrepreneurs accessed 12.961 billion baht, a 20.16% increase over the same period last year.
 

Nongluck Ajanapanya

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https://www.nationthailand.com/business/banking-finance/40021633

BAAC launches new mobile banking app ‘for convenience of farmers’

WEDNESDAY, NOVEMBER 02, 2022

Nongluck Ajanapanya

Thailand’s Bank for Agriculture and Agricultural Cooperatives (BAAC) has launched “A-Mobile Plus”, a new version of its mobile banking that offers farmers access to digital banking.

BAAC president Thanarat Ngamvalairat stated during the launch ceremony on Tuesday that the new application is an improvement over the company’s mobile banking services.

Thanarat said new functions and features are being added to make online transactions faster and easier. Users can now buy lottery savings scheme and apply for loans while their personal information is completely secure.

“Local farmers in rural areas make up the majority of our clients. As a result, we anticipate that our A-Mobile Plus will enable them to access banking services anywhere and at any time, as well as encourage them to participate in a cashless society and digital life,” Thanarat explained.

The move comes just a few weeks after the World Bank released a contentious report revealing that rural Thais, the majority of whom are farmers, continue to live in poverty. One of the primary reasons is a lack of banking and funding.

Meanwhile, he has vowed to take any measures necessary to assist farmers in repaying their debts following the recent severe floods.

He stated that the assistance is part of BAAC’s efforts to reduce its non-performing loan (NPL) rate, which is currently 12.5%. The target for bank NPLs is 7%.

“We have already collaborated with the government to implement numerous relief and subsidy schemes for affected farmers. We intend to launch additional projects aimed at assisting farmers in debt management and income generation,” Thanarat said.
 

He stated that Thai farmers are ready to repay the debt. They are unfortunately unable to do so. Therefore, the BAAC must increase their knowledge of efficient farming, fundamental accounting, effective money management, and product marketing.

Furthermore, he promised to peg the interest rate loan as long as possible if the Bank of Thailand decides to hike the interest rate to stabilise the country’s financial sector.

The announcement comes as BAAC reports its first six-month performance for the current fiscal year, which runs from October 1 to September 30.

During this time, the BAAC has advanced loans totalling 368.745 billion baht, amassing a credit balance of 1.6 trillion baht. Meanwhile, current deposit account totals 1.7 trillion baht. After deducting expenses, the net profit is 1.388 billion baht.

Thanarat confirmed that the bank’s performance remains on track to be a secure rural development bank offering integrated financial services to improve farmers’ quality of life.

Nongluck Ajanapanya

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https://www.nationthailand.com/business/banking-finance/40021568

GSB launches generous savings accounts to ease Thais’ retirement fears

MONDAY, OCTOBER 31, 2022

Nongluck Ajanapanya

The Government Savings Bank (GSB) marked World Savings Day by opening two high-interest saving schemes to help Thais through the cost-of-living crisis on Monday.

Vitai Ratanakorn, president and CEO of GSB, oversaw a ceremony to launch the two new proactive saving schemes.

The first scheme, for medium-term savings, offers annual interest of 4.50 per cent tax-free on money deposited for at least 13 months.

The second scheme, for long-term savings, offers 3.21 per cent annual interest tax-free on money deposited for seven years.

Vitai said that while the government is urging people to spend to boost the economy through domestic consumption, it is also important to set aside money for the long term.

“It is our responsibility to educate people how to balance their spending and savings,” GSB’s chief said.
 

He also vowed to raise interest on savings if the Bank of Thailand decides to hike the policy rate at its next meeting in response to similar moves by the US Federal Reserve. However, GSB loan rates would be kept low for as long as possible.

Thai household savings fell during the Covid-19 pandemic, but with the economy now showing signs of recovery it’s time to encourage people to start saving again, he said.

The new GSB strategy will respond to Thailand’s ageing society by focusing on medium- and long-term saving for retirement.

“These two new savings schemes currently offer the highest interest rate on bank savings accounts. We developed these savings plans not for the benefit of banks but for the benefit of all Thais,” Vitai said.

He added that the new schemes may reduce GSB’s margins but its finances and liquidity would remain strong.

GSB has also launched a new app called Coach Aom, which aims to help people on low income understand basic money management. Users will get saving plans tailored to their circumstances to ensure they have sufficient retirement savings.

The simple functions and features of the user-friendly app were developed in collaboration with Chulalongkorn University’s finance and accountancy faculty.

Coach Aom is available on Android devices, with an iOS version to be released soon.

Nongluck Ajanapanya

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https://www.nationthailand.com/business/banking-finance/40021475

Thailand unveils digital payment plan in 3-year push for cashless economy

FRIDAY, OCTOBER 28, 2022

The Bank of Thailand (BOT) has unveiled its three-year plan for a payment system that will underpin the country’s digital economy.

The plan is Thailand’s response to the challenges of digital disruption, said Ronadol Numnonda, BOT deputy governor of financial institutions stability, on Thursday.

He added that digital finance is rising in Thailand and across the world, as seen in the popularity of digital payments and currencies.

“The number of digital payments globally increased five times last year,” Ronadol remarked.

He outlined three aspects of Thailand’s three-year payment system plan:

Openness: connecting data to create an ecosystem conducive to competition using new technologies and innovations.

Inclusivity: developing the system to cover all groups of users, as well as creating digital literacy among them.

Resiliency: ensuring that all businesses can operate smoothly and combat risks by developing new tools and cybersecurity cooperation.

“This will enable all groups of people to access digital payment, improve their quality of life and drive Thailand towards the digital economy,” he said.

Bangkok Bank executive vice president Sudsanguan Chusacultanachai said digital payment was essential to drive Thailand towards a digitised economy, adding that traditional transactions add costs for financial institutions.

“If we can reduce the use of traditional financial transactions, we can use the leftover cash to develop other services,” she said.

She said that though most people are now familiar with smartphones, old behaviours pose a challenge to Thailand’s digital development. However, a digital economy would relieve burdens for businesses and reduce errors in their operations.

“Digital payment will be key to streamlining processes, enabling Thailand to move towards a digital economy,” she added.

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https://www.nationthailand.com/business/banking-finance/40021129

New verification rule for using cash deposit machines from Nov 15

TUESDAY, OCTOBER 18, 2022

From November 15, people will be required to verify themselves with a debit or credit card when making deposits via cash deposit machines (CDM).

Budsakorn Teerapunyachai, the Bank of Thailand’s senior director of the Payment Systems Policy Department, said this requirement is in line with the Anti-Money Laundering Office’s laws against money laundering and financing of terrorism.

“Verification is necessary to ensure safety in performing financial transactions,” she said.

Budsakorn Teerapunyachai, the Bank of Thailand’s senior director of the Payment Systems Policy Department

People who do not have a debit or credit card can make cash deposits using other channels such as top-up machines, counter services at convenience stores, post offices or bank tellers.

So far, 11 commercial banks have approved the new measure, including Krung Thai Bank, Siam Commercial Bank, Kasikorn Bank, Bangkok Bank, Bank of Ayudhya, TMBThanachart Bank, UOB Bank, CIMB Bank, the Government Savings Bank, the Government Housing Bank and Kiatnakin Phatra Bank.

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https://www.nationthailand.com/business/banking-finance/40021107

Post-Covid situation, economic recovery on agenda of Apec finance ministers’ meeting this week

MONDAY, OCTOBER 17, 2022

The Finance Ministry said on Monday that about 250 representatives from 21 Asia-Pacific Economic Cooperation (Apec) economies and other international organisations are expected to attend the meeting of finance ministers of the group’s members in Bangkok on October 19-20.

Fiscal Policy Office​ director general Pornchai Thiraveja, who acts as Finance Ministry spokesman, said that on the opening day of the meeting the ministers from Apec economies would share opinions on the economic situation in the post-Covid-19 era, the positive and negative factors for economic recovery and policies to boost economic growth.

On Thursday, they will discuss the situation, trends and challenges for the Asia Pacific economy, as well as work on Apec policies, he said.

“Representatives from international organisations, such as International Monetary Fund, World Bank Group and Asian Development Bank, will present information related to the Asia Pacific economy during the meeting,” he said.

He said Thailand would promote various issues related to sustainability to Apec members, such as granting access to funds for sustainable development and applying digital technologies to promote the digital economy.

He added that there also would be follow-up on pending issues during the meeting, such as implementation of the Cebu Action Plan, which offers guidelines to support Apec’s financial integration.

Pornchai added that Apec Business Advisory Council’s Executive Dialogues with Apec Finance Ministers also would be held on October 20, which would focus on access to digital finance and cooperation between the government and private sectors.

“The Finance Ministry believes that it would be able to make guidelines to develop a financial ecosystem that meets sustainable development,” he said.

He added that the meeting is an opportunity to stimulate Thailand’s economy and promote the country’s financial policies.

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https://www.nationthailand.com/business/banking-finance/40020644

Baht opens stronger but selloffs may make it swing sideways

MONDAY, OCTOBER 03, 2022

THE NATION

The baht opened at 37.83 to the US dollar on Monday, strengthening from Friday’s close of 37.85.

The currency will likely move between 37.70 and 37.95 against the greenback during the day and between 37.50 and 38.30 during the week, Krungthai market strategist Poon Panichpibool predicted.

Poon said the baht may also swing sideways, so he suggested monitoring foreign investments. If foreign investors sell fewer Thai assets, it might slow down the baht’s weakening.

In the short term, Poon estimates the baht’s resistance level will remain at 38.20-38.40 to the dollar, as some exporters and foreign investors may sell the dollar for profits.

He expects the support level to be at 37.50 to the dollar, a level at which importers are waiting to buy the currency.

Poon reckons the dollar’s momentum will slow down and may weaken amid currency intervention in several countries.

However, it may also strengthen if the UK government insists on using its economic stimulus and tax-reducing measures which may pressure the pound and pull it down.

The market strategist also advised investors to use hedging tools such as options to manage risks in a highly volatile currency market.

He added that investors are waiting for labour information from the US, such as non-farm payrolls, and the UK government’s budget plans.

THE NATION

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https://www.nationthailand.com/business/banking-finance/40020618

BOT says no threat to foreign reserve from strengthening dollar

SUNDAY, OCTOBER 02, 2022

THE NATION

The Bank of Thailand (BOT) says it is not worried by the falling value of its foreign exchange reserve due to impact from the strengthening dollar.

On Saturday, BOT deputy governor Mathee Supapongse said the central bank had diversified risks by holding many currencies.

“Thailand is still very strong in terms of foreign exchange stability,” he said, adding that this was not a worrisome issue.

He said Thailand had the world’s 12th largest proportion of foreign exchange reserve, higher than the US, European states and many other countries.

The BOT’s reserve of US$240 billion reflected Thailand’s foreign exchange stability and helped to boost confidence among investors, he added.

The baht has plummeted 11.7 per cent to a 16-year low against the dollar this year.

Meanwhile, raising the Thai policy interest rate to 1 per cent had not caused the currency to weaken, Mathee said. He cited South Korea, where the won has weakened more than the baht despite the country’s 2.5 per cent interest rate.

The BOT has hiked the interest rate twice in recent weeks to curb inflation.

Thailand has attracted about 150 billion baht in foreign inflows this year despite the wide difference in Thai and US interest rates. However, foreign investors have also sold about 33 billion baht in Thai bonds.

Mathee said the BOT will continue to monitor currency market volatility to ensure the baht does not weaken against the currencies of regional neighbours and emerging economies.

The baht opened at 37.93 to the US dollar on Friday, strengthening from Thursday’s close of 38.06.

THE NATION