Government Housing Bank has expressed its confidence in achieving Bt134 billion in new loans this year as targeted, while it plans to extend a Bt46-billion loan to the National Housing Authority for a low-income housing project.
The loan for the project is in line with National Council for Peace and Order (NCPO) policy, with units priced between Bt450,000 and Bt1.5 million.
Angkana Chaimanat, GHB president, said 49,000 units would be built from 2015-2017. This year the bank expects to see improvements in residential loans after the NCPO began running the country as there is now more confidence in the economy, she said.
GHB’s new loans totalled Bt56 billion in the first five months of the year. Its new-loan target is Bt134 billion for the whole of 2014.
“Signs for new loan extensions have improved gradually since March. We believe the economy and demand for residential loans will improve after [potential home-buyers] regain confidence,” Angkana said.
GHB has targeted a profit of Bt8.3 billion in 2014. Last year’s profit was Bt8.18 billion, the highest in its 60 operating years.
“Most of the additional new loans came from the provincial areas, particularly Chon Buri, Khon Kaen, Udon Thani and provinces adjacent to the country’s neighbouring countries,” Angkana said. “That’s because of the [pending] Asean Economic Community spurring construction of new houses.”
New loans in the provinces are expected to account for 70 per cent of total new lending this year.
Capital adequacy ration
The bank’s capital adequacy ratio has remained at 18.5 per cent.
Angkana conceded that given the downturn in the economy when political unrest gripped the country, customers’ repayment ability declined and the bank’s non-performing loans (NPL) inched up to 6.12 per cent of the total from 6 per cent at the end of last year.
“The bank targets to lower its NPL rate to 6 per cent by the end of this year,” she said.
This year the bank has written off assets worth Bt2.5 billion and as a result it recorded Bt1.5 billion more in income.
It has targeted income of Bt2.3 billion from the sale of assets this year.