Suspended South Korean banks have low connection with Thai banks

BANGKOK, 22 February 2011 (NNT) – The Bank of Thailand (BoT) confirms that Thai financial institutions will not get affected from the suspension of seven banks in South Korea.

BoT Assistant Governor for Financial Institution Supervision Sorasit Soontornkes explained that the seven South Korean banks forced to suspend operations from the beginning of this year are only small banks and barely have business dealings with Thai financial institutions. Therefore, he was confident that there would be no impacts on the Thai side.

According to Mr Sorasit, the financial status of Thai banks remain strong with a Bank for International Settlements (BIS) ratio of 16% on average while their liquidity is over 30%, which is 6% higher than the minimum requirement.

The assistant governor added that the recent closure of many banks in South Korea mainly resulted from lack of liquidity as a result of the economic recession.

Lately, the South Korean authorities has suspended operations of four more savings banks for six months. Two of them are Busan and Daejoen Banks.