GHB urges changes to Condominium Act
Legal hurdles have prevented the Government Housing Bank from clearing out its non-performing assets, spurring its president Khan Prachuabmoh to push for amendment of the Condominium Act.
The GHB has about 10,000 condos and other residential units worth Bt20 billion pending for auction by the Legal Execution Department of the Justice Ministry. The Condominium Act requires new owners to settle maintenance fees left unpaid by previous owners. Often the amount is too high, resulting in unreasonable prices for condos. Khan, together with the Legal Execution Department, will ask the Interior Ministry to revise the Condominium Act so that new buyers can purchase condos more easily, or do not have to foot the overdue fees. The GHB provides financing for home shoppers and developers who buy properties from the Legal Execution Department. Such loans are estimated to have reached about Bt100 million. Khan yesterday gave Bt5 million to the Legal Execution Department to install a wireless information network so that the bank can access information related to bankruptcy cases. This will enhance the GHB's mortgage lending, as it will have more financial background on its clients. Meanwhile, Finance Minister Chalongphob Sussangkarn yesterday said his ministry would propose to the Cabinet an extension of the value-added tax rate at 7 per cent for another year. The ministry cannot raise VAT back to 10 per cent yet as it could dampen consumption, he said. Chalongphob also said specialised state banks - the GHB, the Government Savings Bank (GSB), the Bank for Agriculture and Agricultural Cooperatives, and the Small and Medium Enterprise Development Bank of Thailand - would propose new lending projects to support low-income groups. For example, the GSB would provide loans of Bt3,000-Bt5,000 to the poor without requiring collateral, but a group guarantee from friends. Deputy Finance Minister Sommai Phasee said he had asked the GSB to cap its non-performing loans at 4 per cent of lending. Currently its NPLs are at 3.9 per cent. The GSB targets expanding its loan portfolio by Bt140 billion this year. Sommai also said his ministry might sign a loan for mass-transit projects with the Japan Bank for International Cooperation in August or September. He dismissed a report that the JBIC was reluctant to participate in the funding.
Wichit Chaitrong The Nation
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