GOVERNMENT Savings Bank (GSB) will mobilise Bt50 billion in the next three months to cope with the scale of lending required to help fund mega-projects under the government’s infrastructure drive, while reaffirming its target for new loan growth of 3 per cent this year.
GSB president Chatchai Payuhanaveechai said the bank would raise its deposit holdings through a number of instruments ranging from offers of special deposits to a second batch of debentures worth Bt14 billion.
“We need to raise money in this period, given the government’s mega-projects, and we have to have money for them,” he said. GSB has deposits of Bt2 trillion.
GSB’s 3 per cent target for new loans this year amounts to Bt400 billion. The bank expects net new loan to reach Bt58 billion this year. The net figure was Bt17 billion in the first three months of this year.
The bank's non-performing loan (NPL) ratio sits at 2.17 per cent of its outstanding loans; 2.27 per cent is forecast for the whole of this year. The figure was 2.04 per cent at the end of last year.
“The rise in bad debts came from all categories of loans. It's normal for higher bad debts when we extend more loans. However, the rise is at a decreasing rate,” Chatchai said.
The bank’s NPL ratio rose 0.4 percentage point at the end of 2016 from the previous year. Its 2017 year-end figure is expected to inch up by 0.23 percentage point.
The bank has launched a package of financial products to meet the needs of an ageing society, with a target of 10,000 elderly customers for such products in the initial phase. Its elderly customer base accounts for 10 per cent of the total depositor base.
The bank had imposed an age cap of 60 for loans. But now it is extending the age limit for borrowings to 70 and, for some loan programmes, 85. For customers aged 60 and over, the bank offers Pracha Rath deposit accounts and other special deposit accounts.
It has also extended the eligibility for Pracha Rath loan for seniors to customers aged up to 70. Some 245 such customers have received loans worth a combined Bt17.73 million.
Conditions for the bank’s reverse mortgage policy have also been eased, with customers aged 60 and over now able to take up the scheme. A loan programme for children who take care of their parents has been extended to those aged at least 20.
Aside from these financial products, GSB has set aside a budget to take care of the elderly in its Pink Pracha Rath Community programme for senior customers’ health and occupational development after retirement.