Thailand’s central bank encouraging use of BIBOR interbank lending

BANGKOK, Oct 2 (TNA) – The Bank of Thailand (BoT) will continue encouraging the country’s commercial banks to lend to each other by adopting the Bangkok Interbank Offered Rate (BIBOR), according to a senior official of the central bank.

The number of business transactions with the interbank reference remains low at present because BIBOR-based products are in a small number and unpopular.

Commercial banks still preferred lending with reference to the minimum lending rate (MLR), according to the central bank source. The activity is more convenient but very volatile.

The BoT source said the central bank would attempt to encourage both Thailand’s commercial banks and the financial market to count more on BIBOR because the reference rate is less volatile. (TNA)