Banks say rally will dampen investor confidence

BANGKOK, 1 April 2010 (NNT) – The banking sector has expressed concerns over the anti-government demonstrations which are likely to be prolonged.

The continuation of the mass demonstrations by the United Front for Democracy Against Dictatorship (UDD) would dampen the investment sentiments of the private sector, said President of Thai Bankers’ Association (TBA) Aphisak Tantiworawong. Mr Aphisak, also the Managing Director Krung Thai Bank Plc, however said that the rallies would not affect business operations in the short term.

Meanwhile, Krungthai Bank’s lending in the fourth quarter for SMEs and major corporations has increased by 50% when compared year on year, three times higher than last year.

The higher lending was due to good investor confidence towards the economic recovery, said Mr Aphisak. However, the TBA president said the loans were for short-term investments rather than long-term ones.

As for long-term investments that require high capital, the production capacity has increased by 80%–a level that is appropriate for expansion.