BAM's profit target raised
The government's Financial Institutions Development Fund (FIDF) has given Bangkok Commercial Asset Management (BAM) a new target, asking BAM to generate a net profit of Bt1.6 billion this year.
The new criteria were initiated during negotiations between the FIDF and BAM yesterday. Earlier, the FIDF forced BAM to increase its sales target this year from Bt11.26 billion to Bt14 billion. BAM president Bunyong Visatemongkolchai said such a target would be difficult to achieve in the current economic situation. The FIDF compromised by lowering the new target: Bt12 billion in sales and a net profit of Bt1.6 billion. Last year, the net-profit target was Bt1.5 billion, but BAM managed to achieve Bt1.7 billion. The FIDF maintained the existing criteria, saying BAM must achieve 80 per cent of the sales target. "If the new target were Bt14 billion, the policy of debt restructuring would be changed," said Bunyong. "Now we are allowing our clients to restructure their debts in accordance with their capabilities. As a result, most debts are long-term maturity. The target should be realistic; otherwise, it will affect the goals and performance of the company in the future." BAM managed to sell assets worth about Bt800 million in January and Bt500 million last month. Bunyong said normally, more assets were sold in the second half of each year, adding that to meet the FIDF's requirements, BAM would have to work harder. "We'll focus more on renovation, in order to sell more," he said. Bunyong said that so far, small assets like houses still met market demand, but sales of large assets were slowing down. This year BAM received Bt2.5 billion in non-performing loans from Secondary Mortgage and Bt9 billion in non-performing assets from banks. Last year, BAM sold Bt11 billion worth of assets, excluding the those of Bank Thai and the Government Housing Bank. It repaid Bt41 billion to the FIDF. BAM will repay the FIDF this year, because dividends are set at 5 per cent of the registered capital of Bt13.27 billion. Meanwhile, newly appointed Siam City Bank president Chaiwat Uthaiwan yesterday said on his way to an official meeting with the Bank of Thailand that he would improve the bank's performance in preparation for rising competition.
Anoma Srisukkasem The Nation
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