Most banks say deposits normal after Bt30 billion pulled from GSB accounts

Economy February 18, 2014 00:00

By Sucheera Pinijparakarn
The Na

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Major private banks have not detected a wave of deposits, even though Bt30 billion in cash was withdrawn by customers of the Government Savings Bank yesterday. 
Weidt Nuchjalearn, a first senior executive vice president of Krungthai Bank, said deposits and withdrawals at KTB were normal.
New customers at the bank yesterday came in for the latest time-deposit campaign offering an interest rate of 4 per cent on a 60-month fixed deposit, 3 per cent for a 14-month fixed deposit and 2.8 per cent with a five-month fixed deposit.
KTB, a state-owned and publicly traded commercial bank, last week sent outreach teams to reassure wealthy depositors that it was not involved with the rice-pledging scheme after one major depositor informed the bank that it would withdraw its money, as it was worried the bank would help finance the rice-pledging scheme. 
The bank has a business continuity plan if it sees a run on deposits. However, its customer base consists mainly of businesses with payroll accounts and SMEs, unlike the GSB, which has mostly retail depositors, he added.
Smith Banomyong, an executive vice president of Siam Commercial Bank, said customers yesterday opened deposit accounts at normal levels. The bank has not seen a flood of deposits.
Noppawan Jermhansa, a first senior vice president at Kasikornbank, said KBank has not noticed a larger flow of new money.
KBank yesterday brought back its 24-month, tax-free fixed deposit account, paying 3.5-per-cent interest, after it drew 100,000 new accounts last year. The minimum monthly deposit is only Bt1,000.
The bank renewed the campaign following its initial plan not to acquire depositors from other banks or the GSB.
“This deposit product is designed to tap the mass segment who have savings discipline,” she said. 
Bangkok Bank was an exception, with savings rising even though it did not launch a special deposit campaign. 
Pochanee Kongkalai, an executive vice president, said the bank found deposits increasing from the wealthy, middle-class and mass segments. It is highly possible that the new depositors were customers moving over from the GSB. 
Suthimon Voravit, an officer of a private company and a GSB depositor, said she withdrew funds from her account at the GSB because she felt uncomfortable leaving her money there after the bank granted a loan to the BAAC.
She will shift her savings to other banks, but if they have extended credit to BAAC like the GSB did, she might consider pulling out her money from those banks and investing in gold instead.