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Bankers oppose baht bonds by foreign firms

By Wichit Chaitrong
The Nation
Published on September 30, 2008

The Thai Bankers' Association (TBA) yesterday urged the Finance Ministry to impose a ban on foreign financial institutions' plans to issue baht-denominated bonds, due to the US financial crisis. President Apisak Tantivorawong told Finance Minister Suchart Thadath-amrongvech domestic liquidity could dry up; hence, foreign institutions should not be allowed to raise funds in the local currency and then convert the money into US dollars via swap contracts.

He said Thai institutions and companies would need more domestic liquidity for investment, because opportunities to raise funds from offshore sources had been shut.

As for mega-infrastructure projects, the Finance Ministry should consider providing soft loans in the same way the central bank used to provide to small and medium-sized enterprises (SMEs) via banks.

Bankers also want the government to give tax incentives for debt restructuring between banks and SMEs.

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Bankers oppose baht bonds by foreign firms

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