Finance Ministry 'need not raise Bt87-bn bond'

The planned Bt87-billion bond issue was to be the final portion of government bonds totalling Bt800 billion promised by the Thaksin Shina-watra government to help finance the FIDF's debt burden.

However, the fund yesterday said it did not need more financial assistance from the government, because it no longer had any short-term debts, large expenses or losses additional to the estimated Bt1.3 trillion it spent bailing out financial institutions after the 1997 financial crisis.

Povongthip Poranmapoin, director of the fund's Operations Department, said the FIDF had also recently sold some of its assets, although it did not yet know the exact amount of revenue it would receive from the sales.

The FIDF's total burdens from the 1997 crisis were estimated at Bt1.3 trillion. The Chuan Leekpai government issued bonds worth Bt500 billion and agreed to redeem FIDF bonds worth Bt112 billion.

The Thaksin administration later agreed to issue government bonds worth around Bt800 billion, and bonds worth more than Bt700 billion have been issued so far. The final portion, yet to be issued, amounts to about Bt87 billion.

If the government has no need to issue the remaining bonds, it could instead spend the money to boost economic growth.

Povongthip said the fund would calculate its remaining debt burden again in 2013, when all of its assets and liabilities would be liquidated before the FIDF is closed down. At that time, the fund will know exactly how much of its debt remains.

"We don't need to ask the government to issue the bonds, because we can handle the current operational costs. Moreover, we must wait for the time when we know exactly how much we can make from selling the fund's assets," she said.

Currently, the FIDF owns stakes in three banks - Bank Thai, Krung Thai Bank and Siam City Bank - and some non-listed companies. It also owns some land plots.

She said that depending on government policy regarding these assets, the FIDF had to consider the proper time for selling them.

"The quality of our assets is not bad, so we can wait for a suitable time to unload them," she said.

The fund has already cleared short-term debt of Bt180 billion on the repurchase market, which will be closed down on February

13.

It has issued bonds worth of Bt166 billion and received Bt14 billion in contributions from commercial banks and debt collection.

Of the Bt166-billion bond issue, Bt73 billion worth

were two- and four-year savings bonds, while the rest were sold to the Bank of Thailand.

Anoma Srisukkasem

The Nation