According to the article, the two recent US bank failures will not have any effect on Thai banks. Those of you who hold Thai bank accounts, this is no cause for alarm.
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Thai banks unaffected by two recent US bank failures
March 13, 2023
Thailand’s commercial banks and other financial institutions have not been affected by the recent failures the US’s Silicon Valley Bank and New York-based Signature Bank in the past week, Deputy Government Spokesperson Traisuree Traisoranakul said today (Monday).
She disclosed that Prime Minister Prayut Chan-o-cha has, however, ordered the government’s economic team to monitor the situation closely.
She said that no Thai commercial banks or financial institutions had invested or engaged in any transactions with the two failed US banks, adding that the impact of the closures on the US economy is limited, because the services of the two banks were limited, unlike ordinary commercial banks, and thanks to swift intervention by the US regulators.
According a Bank of Thailand report at the end of last year, all Thai commercial banks’ BIS (Bank for International Settlements or capital to risk asset ratios) amounted to 19.4%, with a liquidity coverage ratio (LCR) at 197.3 and the amount of non-performing loans at 2.73%, whereas the NPL coverage ratio stands at 171.9%. Credit extension and deposits are not concentrated within certain groups, but spread broadly.
The strict enforcement of measures by the Bank of Thailand has resulted in the strengthening of the Thai banking system and has enabled Thai commercial banks to weather the global financial and COVID-19 crises, said Traisuree.
Moreover, she said, Thailand has strong systems in place to protect depositors, through the creation of a 124 billion baht fund, which guarantees the deposits of up to 98% of bank deposits, to the tune of one million baht per depositor.
https://www.thaipbsworld.com/thai-banks ... -failures/
US bank failures no cause of concern to Thai banks
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Gaybutton
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Jun
Re: US bank failures no cause of concern to Thai banks
Should the economic team should need instructions to monitor such events?
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Gaybutton
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Re: US bank failures no cause of concern to Thai banks
While apparently the USA bank failures will not harm Thailand's banks, that doesn't mean there won't be an effect on the exchange rates. At the time of this post, I have not seen any kind of significant change in the current exchange rates.
What do you folks think will happen? Nothing substantial? Better exchange rates? Worse exchange rates?
Based on my take on the following article (and I certainly am no expert), I'm hoping to see better exchange rates.
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US bank fears hit Asia stocks
March 15, 2023
The Thai stock exchange fell more than 3%, almost 50 points, on Tuesday in tandem with most Asian stock markets due to fears of contagion effects from the collapse of US banks.
The Stock Exchange of Thailand (SET) index closed on Tuesday at 1,523.99, down 49.18 points or -3.13% in trade worth 103.8 billion baht.
The SET pointed out that investors had overreacted to what has occurred, and the agency and the Securities and Exchange Commission (SEC) are preparing to implement circuit-breaking measures in a bid to control the situation.
SET president Pakorn Peetathawatchai said that the plunge took place not only in Thailand but also in Asian and European stocks.
This was, he said, due to several factors, including the falling Brent crude oil price, a slow recovery of the global economy, rising interest rates, declining financial liquidities, and the failure of Silicon Valley Bank (SVB), the second-biggest US bank failure ever.
The government has responded with measures, such as deposit guarantees, Mr Pakorn said, adding that no forced selling or short selling was detected on Tuesday.
Mr Pakorn said that foreign investors and institutional investors on Tuesday sold out Thai shares to avoid the volatility caused by the US bank failures.
They were expected to move their money to safe-haven assets such as US dollars and gold, he said.
He further added that the Thai stock market has overreacted to the current situation with the US collapsed banks being specialised lenders for startups and technology businesses, so the impact should be limited.
Praoporn Senanarong, assistant secretary-general of SEC, said that there were reports of Moody’s Investors Service downgrading the debt ratings of collapsed New York-based Signature Bank deep into junk territory and placing the ratings of six other US banks under review for a downgrade, sparking panic selling of shares in overseas banks.
In light of this, the SEC will hold talks with the SET to come up with circuit-breaker measures to temporarily halt trading to curb panic selling on the stock market if the market plunges by 5%, 8% or 10%, Ms Praoporn said.
The sudden failure of SVB on Friday, followed by Signature Bank two days later, sparked heavy market losses worldwide on fears of a domino effect that could heighten recession risks around the world.
Equity markets were well in the red in Asian trade on Tuesday, with Tokyo, Hong Kong and Seoul more than 2% down, while Sydney, Taipei, Manila, Jakarta and Bangkok all shed more than 1%. Shanghai, Mumbai, Singapore and Wellington also sank.
https://www.bangkokpost.com/business/25 ... sia-stocks
What do you folks think will happen? Nothing substantial? Better exchange rates? Worse exchange rates?
Based on my take on the following article (and I certainly am no expert), I'm hoping to see better exchange rates.
_________________________
US bank fears hit Asia stocks
March 15, 2023
The Thai stock exchange fell more than 3%, almost 50 points, on Tuesday in tandem with most Asian stock markets due to fears of contagion effects from the collapse of US banks.
The Stock Exchange of Thailand (SET) index closed on Tuesday at 1,523.99, down 49.18 points or -3.13% in trade worth 103.8 billion baht.
The SET pointed out that investors had overreacted to what has occurred, and the agency and the Securities and Exchange Commission (SEC) are preparing to implement circuit-breaking measures in a bid to control the situation.
SET president Pakorn Peetathawatchai said that the plunge took place not only in Thailand but also in Asian and European stocks.
This was, he said, due to several factors, including the falling Brent crude oil price, a slow recovery of the global economy, rising interest rates, declining financial liquidities, and the failure of Silicon Valley Bank (SVB), the second-biggest US bank failure ever.
The government has responded with measures, such as deposit guarantees, Mr Pakorn said, adding that no forced selling or short selling was detected on Tuesday.
Mr Pakorn said that foreign investors and institutional investors on Tuesday sold out Thai shares to avoid the volatility caused by the US bank failures.
They were expected to move their money to safe-haven assets such as US dollars and gold, he said.
He further added that the Thai stock market has overreacted to the current situation with the US collapsed banks being specialised lenders for startups and technology businesses, so the impact should be limited.
Praoporn Senanarong, assistant secretary-general of SEC, said that there were reports of Moody’s Investors Service downgrading the debt ratings of collapsed New York-based Signature Bank deep into junk territory and placing the ratings of six other US banks under review for a downgrade, sparking panic selling of shares in overseas banks.
In light of this, the SEC will hold talks with the SET to come up with circuit-breaker measures to temporarily halt trading to curb panic selling on the stock market if the market plunges by 5%, 8% or 10%, Ms Praoporn said.
The sudden failure of SVB on Friday, followed by Signature Bank two days later, sparked heavy market losses worldwide on fears of a domino effect that could heighten recession risks around the world.
Equity markets were well in the red in Asian trade on Tuesday, with Tokyo, Hong Kong and Seoul more than 2% down, while Sydney, Taipei, Manila, Jakarta and Bangkok all shed more than 1%. Shanghai, Mumbai, Singapore and Wellington also sank.
https://www.bangkokpost.com/business/25 ... sia-stocks
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Jun
Re: US bank failures no cause of concern to Thai banks
Predicting future exchange rates is way too difficult and anyone who can do it ought to have made enough to be exceedingly rich.
Assessing what has already happened is easier. The USD has weakened against the THB.
There is a suggestion that the Fed might be more careful about raising interests, just in case it causes any more mismanaged banks to fail. Such sentiment would tend to weaken the dollar.