Finance Ministry eases concern on household debts

[webfact]

Finance Ministry eases concern on household debts

By THE NATION

 

Lavaron

 

The Finance Ministry on Wednesday (September 9) moved to ease public concern on high household debt in the first quarter of the year.

 

Lavaron Sangsnit, director-general of the Fiscal Policy Office and the ministry's spokesperson, said the level of household debt in the first three months was still lower than the peak in 2015 when it accounted for 81.2 per cent of the gross domestic product (GDP).

 

The ministry said it has yet to become a pressing issue as most of the borrowings were backed by collateral and that they should be deemed as part of the process in building up one's wealth or as investment to generate income.

 

Total household debt as of the end of the first quarter stood at Bt12.97 trillion or 78.7 per cent of GDP, of which 42.8 per cent were loans from commercial banks. Most of the loans were backed with assets of the borrowers, for the purpose of acquiring assets such as properties and vehicles or used as operating expenses of their businesses. 

 

When excluding loans for businesses, total household debt in the first quarter would have fallen to Bt10.84 trillion or 65.8 per cent of GDP, Lavan said.

At the same time, the level of loans for personal consumption or personal loan remained low at 6.3 per cent of the total debt while non-performing loans among households accounted for just 3.3 per cent in the quarter. 

 

The office, he said, will continue to monitor the situation.

 

Earlier this week, the National Economic and Social Development Council (NESDC) and the Bank of Thailand both raised concern on the high level of household debt.

 

According to the NESDC, total household debt nationwide in the first quarter amounted to Bt13 trillion, rising by 6.3 per cent year-on-year and accounting for 78.7 per cent of GDP – the highest since the first quarter of 2017.

 

The state think-tank warned that household debt has been rising continuously since mid-2017, adding that the debt level would likely be higher in the second quarter, given the 9.2 per cent increase in personal loans from commercial banks during the period.

 

Source: https://www.nationthailand.com/business/30375844

 

-- © Copyright The Nation Thailand 2019-09-05

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[Brickbat]

Debt Bomb waiting to explode . The rich are waiting on the wings , ready to swoop in and buy up cheap when that bomb goes off

[fullcave]

4 hours ago, webfact said:

The ministry said it has yet to become a pressing issue as most of the borrowings were backed by collateral

Yup, that's how they manage to lose their homes. It's a common story here in Thailand. It's like taking candy from a baby. 

[trainman34014]

No worries; all backed up by 'Collateral'.    In other words if the poor default on their loans the rich Bankers and the Elite get to steal all their property, so nothing to worry about at the level 'people matter' !

[Bert Jones]

I know of a 25 year old who got her parents to sign their family home over to the banks in order to get a student loan. They failed to pay back the student loan and the bank took the home. Evil.

[worgeordie]

With people paying the minimum amount every month on their

credit cards they are never going to get out of debt,which is what

the banks want, credit card debt is not covered by collateral.

regards Worgeordie

 

 

 

[gunderhill]

Huh  well when someone buys  a  condo often is the case they   ask the bank to lend 4  million but the condo only costs 3  million so  1  million disappears into non assets.

[KKr]

51 minutes ago, worgeordie said:

With people paying the minimum amount every month on their

credit cards they are never going to get out of debt,which is what

the banks want, credit card debt is not covered by collateral.

regards Worgeordie

and moreover, other than the repayment, a monthly not modest interest charge PLUS exorbitant handling fees make sure that almost no-one will recover after borrowing about 9 months to a year or more of salary.

[thaiguzzi]

7 hours ago, webfact said:

Finance Ministry eases concern on household debts

Gosh, thanks!

Good to know, we'll just go and borrow M  O  R  E.............

Idiots. Complete idiots.