The GOVERNMENT Savings Bank expects its profit to contract by between Bt8 billion and Bt9 billion if the bank has to contribute 0.47 per cent of total deposits yearly to a development fund for the special financial institutions, otherwise known as state banks.
The GSB is working on measures to alleviate farmers' debt burden as they are hurt by drought and weak agricultural prices; these are to be finalised within two weeks.
Meanwhile, the Government Housing Bank (GHB) plans to allocate Bt8 billion in housing loans for low-income groups.
GSB president Chatchai Payuhanaveechai said an annual contribution of 0.47 per cent of total deposits to a state-bank development fund would reduce its typical annual profit of more than Bt20 billion by between Bt8 billion and Bt9 billion. Hence the GSB wants the government to allow more flexibility and time for banks to comply with this requirement.
Bid to boost revenue
Though the actual contribution requirement for the state banks' development fund has not been finalised, the GSB says it is already seeking ways to boost revenue, such as expanded financial services to bring in more service fees, and expanding the client base by focusing more on people 30 years old and younger.
Meanwhile, the GHB is allocating Bt8 billion for housing loans this year for low-income earners.
People earning less than Bt15,000 a month can apply for a loan of not more than Bt1.5 million with a 3.5-per-cent interest rate for the first year, 4.25 per cent in the second year, and the minimum retail rate minus 0.75 percentage point from the third year to the loan's maturity date.
The GSB housing-loan project is one of the five measures aimed at narrowing income disparity for which the bank has set aside Bt25.5 billion, which the bank will gradually launch one by one.
This is also part of the bank's push to extend new loans this year as per its target of Bt149.8 billion. The GHB extended Bt18.68 billion in new loans last month, up 13.51 per cent from February las