Bank depositor protection cut to Bt5 million

[rooster59]

Bank depositor protection cut to Bt5 million

By The Nation

 

 

Coverage amounts for protection of deposits has been reduced by half, from Bt10 million to Bt5 million per account per financial institution starting August 11, the government’s Deposit Protection Agency (DPA) said.

 

 

The period of protection will last until August 10, 2020 after which the coverage amounts will be reduced to Bt1 million.

 

DPA president Songpol Chevapanyaroj said depositors covered will also drop to 99.65 per cent of total bank depositors from 99.83 per cent at present.

 

When the coverage amount reduces to Bt1 million, the depositor coverage will reduce to 98.14 per cent of total depositors.

 

“Although the number of depositors covered will have decreased, the coverage rate is higher than the global benchmark,” he said.

 

DPA, established in 2007 in the aftermath of the 1997 financial crisis, has been created to reduce taxpayers’ burden when crisis hits the financial system. Before the crisis, a blanket coverage was in place, therefore it was largely attributed to a rapid rise of public debt as a result of government spending tax money to rescue the banking sector.

 

The limited insurance is expected to check the risky behaviour of investors who search for high rate of returns without taking into account potential risks.

 

Source: https://www.nationthailand.com/business/30374582

 

-- © Copyright The Nation Thailand 2019-08-11

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[geoffbezoz]

So looking like they are, due to looming major economic downturn, preparing for future potential insolvency of a major banking institution and preparing to "steal" from their current investors.  Check the major/majority shareholders of each major Thai bank !!

Edited August 10, 2019 by geoffbezoz

[BritManToo]

43 minutes ago, rooster59 said:

The limited insurance is expected to check the risky behaviour of investors who search for high rate of returns without taking into account potential risks.

I should have thought first before chasing that 1.6% return on my savings.

[gunderhill]

I  wouldnt count on ANY protection in Thailand when the shit  hits  the fan, not even 1 baht

[gunderhill]

Just now, BritManToo said:

I should have thought first before chasing that 1.6% return on my savings.

its  people  like you blah blah etc etc ????

[ukrules]

They know it's coming and are preparing for it this time around.

[leeneeds]

Buy gold bricks and install in a secure bank vault, 

no acquiring possible,  other than rental rates and insurance is roughly 50%

of rental cost, as an option.

[RichardColeman]

Who was the guy that recently said Thailand was seen as a safe haven for investors ? With potentially you losing over 90% of your savings, I expect a huge run on the Thai banks now - or people spreading it around more - assuming you can open an account !

[mahjongguy]

It would have been helpful if the news writer had stated the situation correctly. It's not "Bt5 million per account per financial institution". It's "Bt5 million per account holder per financial institution".

[Pedrogaz]

Need to open multiple bank accounts. I have several accounts, including, some with more than 5 million. When it drops to 1 million next August, pretty much all of my money will be exposed. On top of all the immigration stuff here is yet another reason to leave these sunny shores.

[Baerboxer]

6 hours ago, geoffbezoz said:

So looking like they are, due to looming major economic downturn, preparing for future potential insolvency of a major banking institution and preparing to "steal" from their current investors.  Check the major/majority shareholders of each major Thai bank !!

 

Er, this plan has been in place a number of years. Which rather makes your suggestion that it's due to "looming economic conditions" seem rather ridiculous.

[geoffbezoz]

11 minutes ago, Baerboxer said:

 

Er, this plan has been in place a number of years. Which rather makes your suggestion that it's due to "looming economic conditions" seem rather ridiculous.

Really ? show us the link stating the reduction in bank depositor protection being reduced to 5 and then 1 million from years ago ?

[Kerryd]

55 minutes ago, mahjongguy said:

It would have been helpful if the news writer had stated the situation correctly. It's not "Bt5 million per account per financial institution". It's "Bt5 million per account holder per financial institution".

That makes a huge difference ! Instead of having 5 mil(+) in an account (or accounts) at one bank, you'll need to split it up between 2 (or more) banks, and then even more when the coverage drops to 1 mil (assuming that will also be 1 mil per account holder and not per account).

 

Good luck ever getting the money back in any event. I'm sure most people will have died of old age before ever seeing a satang come back if they have another crisis like the one in '97.

[geoffbezoz]

2 minutes ago, Kerryd said:

That makes a huge difference ! Instead of having 5 mil(+) in an account (or accounts) at one bank, you'll need to split it up between 2 (or more) banks, and then even more when the coverage drops to 1 mil (assuming that will also be 1 mil per account holder and not per account).

 

Good luck ever getting the money back in any event. I'm sure most people will have died of old age before ever seeing a satang come back if they have another crisis like the one in '97.

And by 3 Q next year will be exactly that crisis repeated. Whilst the 15 million down to 10 million was to minimize general bank risks 3 years ago, this latest change down to 5 and then 1 million next year is exactly for the reasons I stated in my earlier post 2. Any non Thai investor with significant monies on deposit must be soiling their underwear I should think, or else pretending all is well with the Thai economy and/or they own those designer rose tinted glasses outlets.

[Krataiboy]

7 hours ago, geoffbezoz said:

So looking like they are, due to looming major economic downturn, preparing for future potential insolvency of a major banking institution and preparing to "steal" from their current investors.  Check the major/majority shareholders of each major Thai bank !!

Yep. And obviously looking ahead to when Thailand goes totally cashless and every baht you own will exist only on a bank computer and be legally their property.

 

Do we SERIOUSLY want to get rid of real monety?

[geoffbezoz]

1 minute ago, Krataiboy said:

Yep. And obviously looking ahead to when Thailand goes totally cashless and every baht you own will exist only on a bank computer and be legally their property.

 

Do we SERIOUSLY want to get rid of real monety?

The old saying that "cash is King" seems more true now than ever. Although perhaps we should now also say "Gold is Queen" ?

[david555]

Just now, geoffbezoz said:

And by 3 Q next year will be exactly that crisis repeated. Whilst the 15 million down to 10 million was to minimize general bank risks 3 years ago, this latest change down to 5 and then 1 million next year is exactly for the reasons I stated in my earlier post 2. Any non Thai investor with significant monies on deposit must be soiling their underwear I should think, or else pretending all is well with the Thai economy and/or they own those designer rose tinted glasses outlets.

And they are sure of  a certain number of pensioners contribute at least 400 k baht a year by year because  i.o. new ruling , 400k on bank a whole year if you calculate the requirements .

[Pib]

Really ? show us the link stating the reduction in bank depositor protection being reduced to 5 and then 1 million from years ago ?

Just go to the Thailand Deposit Agency web site for more info...this reduction has been long planned.

http://www.dpa.or.th/en/site/index

[Krataiboy]

The limited insurance is expected to check the risky behaviour of investors who search for high rate of returns without taking into account potential risks.

 

Cobblers. It was the banks, not investors', risky behavior which brought about the last banking crisis. You can bet it will be the same next time around - and guess who will pick up the tab for bailing out the casino bankers?

 

 

[Krataiboy]

Just now, geoffbezoz said:

The old saying that "cash is King" seems more true now than ever. Although perhaps we should now also say "Gold is Queen" ?

It should be and has increased in value lately. But we know markets are manipulated to keep the price of gold artificially low - and that is not going to change.

[geoffbezoz]

5 minutes ago, Pib said:

Just go to the Thailand Deposit Agency web site for more info...this reduction has been long planned.

http://www.dpa.or.th/en/site/index

The report has only just been updated based on the current announcement.  It is not a report from years ago,  Or did I miss it ?

Edited August 11, 2019 by geoffbezoz

[geoffbezoz]

6 minutes ago, Krataiboy said:

It should be and has increased in value lately. But we know markets are manipulated to keep the price of gold artificially low - and that is not going to change.

True but gold still seems a safer haven then many junk currencies though, the GBP being a prime example

Edited August 11, 2019 by geoffbezoz

[Pib]

The report has only just been updated based on the current announcement.  It is not a report from years ago,  Or did I miss it ?

Yes...you missed something...that info has been on the DPA web site for years...like showing the coverage being as high as Bt25M back in 2015 and the ensuing step down schedule. Old news.

[geoffbezoz]

Just now, Pib said:

16 minutes ago, geoffbezoz said:

The report has only just been updated based on the current announcement.  It is not a report from years ago,  Or did I miss it ?

Yes...you missed something...that info has been on the DPA web site for years...like showing the coverage being as high as Bt25M back in 2015 and the ensuing step down schedule. Old news.

Please provide the link relating to that earlier coverage, as it does not seem to exist in my searches. The old coverage of 25 million is stated on the latest page update also, but only as an historical record.

[dabhand]

18 minutes ago, geoffbezoz said:

The report has only just been updated based on the current announcement.  It is not a report from years ago,  Or did I miss it ?

This is a topic from 2015.

 

https://forum.thaivisa.com/topic/865382-bank-deposit-insurance-reduction-in-2016/

[Pib]

Please provide the link relating to that earlier coverage, as it does not seem to exist in my searches. The old coverage of 25 million is stated on the latest page update also, but only as an historical record.

Old news...seems whenever one of the planned coverage step downs occurs some people react like its new news....caused by some recent financial or political event..etc. Old news.

[geoffbezoz]

8 minutes ago, dabhand said:

This is a topic from 2015.

 

https://forum.thaivisa.com/topic/865382-bank-deposit-insurance-reduction-in-2016/

But that report you have just quoted is erroneous as it states "On August 11th 2016 it will be reduced to only 1 million baht" so clearly it was inaccurate as it will only be reduced to 1 million from Aug 2020 as per the most recent announcement by the Thai government department.

 

Edited August 11, 2019 by geoffbezoz

[Airalee]

7 hours ago, leeneeds said:

Buy gold bricks and install in a secure bank vault, 

no acquiring possible,  other than rental rates and insurance is roughly 50%

of rental cost, as an option.

I looked into that at Bangkok Bank (Emquartier branch) and was told that in order to get (rent) a safe deposit box I needed to have a minimum account balance of ฿10,000,000.  

[khunPer]

Note to myself: Take some money out the banks Monday, and place them under the mattress instead...

 

In Europe we have a guarantee of 100k euro, that would relative been similar to some 750,000 baht, perhaps up to 1 million baht, which will be the deposit gurantee here from next year's August 11th.

[NightSky]

..a way to slow hot money inflows and influence the Thai baht?