The Nation



SCB to amend credit rating of clients' loan payment behaviour

Pikun Srimahunt, first executive vice president and head of mortgage business.

Pikun Srimahunt, first executive vice president and head of mortgage business.

Siam Commercial Bank, the biggest mortgage lender among commercial banks, will start using a new credit-score system for home loans next month to assess repayment behaviour besides focusing on the income and occupations of applicants.

SCB wants to screen customers more thoroughly amid the current economic uncertainties.

Pikun Srimahunt, first execu-tive vice president and head of mortgage business, said the bank had to be more vigilant for what it calls "grey customers" whose loans might go bad in the future.

"Grey customers are applicants who did not make their payments on the due date in some months even thought they did so in later months. This behaviour can show that the economic slowdown has affected their cash-flow, both for white-collar workers and entrepreneurs," she said.

About 15-20 per cent of recent mortgage applicants at SCB were "grey" customers, she said.

Improved credit scoring is part of the bank's strategy for 2014, as it believes the economic slowdown and the political uncertainty will have serious impacts on the property market and the mortgage business, Pikun said.

She said property developers planned to cut back on new projects next year amid the economic uncertainty, making it difficult for the bank to predict the mortgage market. Therefore, it will not aggressively pursue new home loans in 2014 but will refocus on existing customers to maintain net loan growth.

"We will ask existing customers who are used to making overpayments to consider normal monthly payments instead while offering period extensions to help ease their financial burden," she said.

"We don't want to see a rapid reduction of outstanding loans because in 2014 SCB will not chase new loans as much as before."

SCB targets net loans of Bt40 billion to Bt50 billion next year to keep its market share of 30 per cent, while new housing loans are projected at Bt110 billion to Bt120 billion, down from Bt130 billion this year.

SCB's outstanding housing loans in 2014 will be Bt500 billion, up from Bt450 billion in 2013, she said.

Mortgages are expected to expand by only 6 per cent compared with 9 per cent this year.

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