Krungthai Bank president Vorapak Tanyawong has promised employees that the bank will not grant loans to finance the government's beleaguered rice-pledging project directly or indirectly, even as many farmers face financial disaster due to non-payment for
More than 500 KTB employees gathered yesterday morning at the bank’s headquarters to demand that Vorapak leave a board meeting to make this pledge.
Vorapak met with the employees and insisted that the bank would not grant loans to shore up the troubled programme despite the plight of the farmers, saying he believed that the government would find a solution for the crisis without “burdening the banks”.
The government, which is severely restricted in its ability to raise funds through normal channels because of its caretaker status, has appealed to the country’s banks for help via a loan tender. But as long as the rules on such a loan remain unclear, KTB has refused to cooperate, he said.
“We will not get involved with politics … Our duty is doing banking business. KTB is not a tool to serve politicians.
“I insisted … that throughout my 15 months working at KTB, there has been no political intervention on procurement or lending. KTB today is under a transparent administration, and we [achieved] good cooperation with our employees one year ago. The bank this year is facing a troubled time, but we don’t want to be troubled by politics,” he said.
After receiving Vorapak’s assurances, the employees dispersed.
Speaking at a press briefing earlier, before the meeting of the board of executives, Vorapak said rumours had circulated on social media for two weeks that KTB had lent Bt160 billion to subsidise the rice-pledging scheme. He strongly insisted that the bank had never granted loans to the scheme and had not received any requests from state agencies to do so. The board of executives had not discussed the matter, he said.
“I have worked in the financial sector for more than 20 years. I was the first Thai to be country manager at Bank of America. I have worked at KTB professionally [and without political connections]. I have no need to reward anyone because I am not in debt to anyone,” he told reporters.
He said the working process at KTB was bottom-up, which meant anything could be proposed by the lower levels to the upper level. Therefore, the board members cannot order the bank to grant a high-risk loan.
He noted that in general bidding on loans for state programmes was low-risk as the government was the guarantor, but the situation with the rice project is different because the regulations are unclear. KTB must ensure that funding the project will not harm the bank.
He said all parties including KTB acknowledged that without assistance, the problems faced by the farmer-subsidy project would spread to the social and financial sectors.
“Farmers should receive their money quickly, and the government will seek
solutions to help farmers without burdening the banks,” he said. After the press briefing, about 50 employees gathered in front of the meeting room, shouting: “Don’t lend … protect depositors’ interests.”
Vorapak assured the employees that KTB would operate with transparency and protect all stakeholders including depositors, investors and customers.
Wallop Tansuwan, chairman of Krungthai Bank Labour Union, yesterday sent an open letter to Worawit Jampirat, chairman of the board of directors, explaining the union’s concerns. It made three demands.
First, loans will not be considered if ordered by the government or by state agencies.
Second, as lending has impacts on banking business from supporters and opponents of such a loan, the board must have reserve plans to protect the bank’s liquidity and security.
Third, the bank must follow the law in order to avoid impacts to the bank’s employees. If any acts are unusual, violate the law or do not protect the bank’s interests, the union will strongly oppose them and will take measures.