BAM obtains GHB's NPLs worth 6,971 million baht and prepares to negotiate with debtors for debt restructuring.

          Today, October 17, 2017, Government Housing Bank (GHB) and Bangkok Commercial Asset Management Public Company Limited (BAM) have signed NPLs sales and purchase agreement of 2017. The total value of principal balance is 6,971 million baht. This would reduce GHB’s NPLs to 4.61 percent of all the loans or a decrease of 0.68 percent. As for BAM, the company is prepared for the management of the NPLs and has planned to inform debtors so as to invite them for negotiation for debt restructuring. The company aims to conduct compromising talks in order to reach a final agreement that will leave both the company and the debtors with mutual benefits and to help them return to the economic system.

          Mr. Chatchai Sirilai, the president of Government Housing Bank, revealed that selling NPLs to BAM this time is part of non-performing home loan management plan as well as the development of asset quality after the Ministry of Finance, since 2016, has allowed GHB to sell its NPLs that have been outstanding for more than 3 years and are worth no higher than 14,000 million baht. After the bank had informed its debtors that it would sell the NPLs according to the process, a number of debtors contacted and decided to undergo the process of restructuring debts with the bank. This resulted in the remained amount of NPLs sold to BAM of which the committee of GHB approved that the value of principal balance equals 6,971 million baht. This also helped lessen the number of the bank’s NPLs as of September 30, 2017 from 5.29 percent to 4.61 percent of all the outstanding loans or 0.68 percent of reduction in total. Besides, selling NPLs has helped the bank save time, human resources and the cost of operating activities related and strengthen the bank financial status. The bank, therefore, could turn the money obtained from selling NPLs into its reserve funds so as to support giving out new loans to its customers to meet the bank’s target of 178,224 million baht worth loans. On October 16, 2017, GHB could give new loans worth 126,995 million baht in total. And at the end of the third quarter of 2017, compared to the end of 2016, the bank held outstanding loans, before selling it to BAM this time, of 980,646 million baht, 4.67 percent increase. The total asset was 1,050,666 million baht, 7.43 percent increase. The total deposit was 862,767 million baht, 10.50 percent increase. And the net profit was 9,048 million baht. Meanwhile, the BIS Ratio as of the end of August, 2017 was in a strong level, at 14.42 percent and was 8.50 percent higher than the minimum capital requirement ratio set by the Bank of Thailand.

           Mr. Krit Sesavej, the President of Bangkok Commercial Asset Management Public Company Limited (BAM), said that the signing of NPLs sales and purchase agreement between GHB and BAM has the principal balance of 6,971 million baht or 13,407 cases of debtors who are in Bangkok and other provinces. Since 2005, BAM has signed NPLs sales and purchase agreement with GHB four times involving the principal balance of 26,722 million baht or 50,586 debtors.

          As for the next step, BAM will be sending letters to its debtors so as to notify them that they can join a negotiation in order to conduct debt restructuring. The negotiation will be mainly focusing on the ability of the debtors to pay debts and on the compromising way of negotiating. This is done in order to come to an agreement that yields benefits for both parties. Although debts are under the suing process or the process of legal execution, BAM gives its debtors the opportunity to restructure their debts and aims to help them return to the economic system.

        Currently, BAM has 76,230 cases of NPLs with total debts of 435,826 million baht under its management. Meanwhile, it has 15,824 items of NPAs, worth 43,605 million baht. The main purpose of buying NPLs and NPAs from financial institutions to manage is that BAM focuses on working as a tool for the government to solve and reduce problems related to NPLs in the system of financial institutions in order to efficiently boost the economic development of the country going forward.