Bangkok Bank managing director Singh Tangtatswas said its capital base was strong enough to comply with new Bank of Thailand financial standards and pay a dividend to shareholders.

The country's largest bank paid an interim dividend of Bt1 a share for the first half of 2006.

Singh said the bank's capital adequacy ratio (CAR) had stood at around 14 per cent of risk-weighted assets at the end of the third quarter. That complies with International Accounting Standard 39 (IAS39) and Basel II.

IAS39 implementation will be completed at the end of this month, followed by another round in June and the last one in December next year. Basel II will be adopted in 2008.

Earlier, a top central-bank official said it was uncertain if commercial banks needed to raise fresh funds to comply with IAS39.

"Big banks have been prepared for new international standards. Thus

they are likely to be ready for the change, including Bangkok Bank," Singh said.

According to Siam Commercial president Jada Wattanasiritham it will pay between 30 per cent and 40 per cent of net profit in dividends.

The bank paid an extra dividend of Bt3 per share in 2005 for its centenary; it paid Bt2 a share the previous year.

Jada said Siam Commercial did not need to increase capital to comply with the new standards. It has a capital base of more than Bt90 billion,

The bank's CAR is at 15 per cent, higher than the central-bank minimum requirement of 8.5 per cent. Of the total, its tier-one capital base stands at between 12 per cent and 13 per cent.

Somruedi Banchongduang

The Nation