What would happen if a Bank goes down?

[ChipButty]

I can help thinking like lots of guys on here all have money in some Thai banks

In the current situation when lots of us Farangs have at least 800k in a bank and the possibility of the bank going bust

Would the government bail them out? the effect on our visa's I guess would be a nightmare for a lot of people

Do we have any sort of guarantee or are we only covered for so much? 

Am I thinking too mut?

[Pravda]

Good question actually. 

 

Even if your money is insured I'd think the process would take at least a year to get your "refund" 

[saengd]

I think you are thinking too much for a number of reasons.

 

Firstly, deposits up to 5 mill. Baht are insured by the DPA until August, thereafter it's 1 mill. Baht.

 

Second, Thai banks are rated quite highly by the rating agencies such as Moodys and Fitch who have increased their credit ratings a couple of times fairly recently.

 

Third, Thai banks Tier 2 Capital Adequacy Ratio's at Thai banks are much higher than is required by law, they average around 9%.  That means bank balance sheets can withstand much more stress than many of their Western counterparts.

 

Finally, a lot of the actions that the likes of BOT take in the financial and economics arena today have their basis in the economic crash of 1997. BOT and government is so determined not to repeat any part of that process that they tend to veer heavily towards the side of safety and caution rather than anything else and at times that can be a problem for the economy, case in point the IMF urging the government to operate a higher deficit budget which they believed was far too low! 

 

If it helps any, at various times over the past ten years I have held up to 90% of my liquid wealth in Thai. banks in Thailand, I'm currently holding 76% here, that is over 60% of my total assets.

 

 

Edited March 26, 2020 by saengd

[donnacha]

22 minutes ago, Pravda said:

Even if your money is insured I'd think the process would take at least a year to get your "refund" 

Yup. And, in the meantime, Thai Immigration would refuse any renewals unless you put another 800K in another Thai bank.

 

Incidentally, with insanely high levels of personal and business debt, and a population who have difficulty managing their money even at the best of times, it is quite likely that one or more of the banks will collapse.

The massive build out of all types of business over the past ten years was undertaken on the presumption that mass tourism into Thailand would continue to grow. Even sectors not obviously connected to tourism will be wiped out for at least the next three years.

Much of the property boom, too, was based on middle class Thai and Chinese folks making highly-leveraged purchases of condos on the assumption that they could pay the mortgages with Airbnb rentals. All screwed now.

 

Edited March 26, 2020 by donnacha

[saengd]

1 minute ago, donnacha said:

Yup. And, in the meantime, Thai Immigration would refuse any renewals unless you put another 800K in another Thai bank.

 

Incidentally, with insanely high levels of personal and business debt, and a population who have difficulty managing their money even at the best of times, it is quite likely that one or more of the banks will collapse. The massive build out over the past ten years was all undertaken on the presumption that mass tourism into Thailand would continue to grow. That whole sector will be wiped out for at least the next three years. Much of the property boom, too, was based on middle class Thai and Chinese folks making highly-leveraged purchases of condos on the assumption that they could pay the mortgages with Airbnb rentals. All screwed now.

Nonsense, pure speculation without any basis in fact, pure scaremongering.

[Pravda]

4 minutes ago, saengd said:

Nonsense, pure speculation without any basis in fact, pure scaremongering.

 

Well you certainly painted quite a rosy picture.

 

 

[donnacha]

1 minute ago, saengd said:

Nonsense, pure speculation without any basis in fact, pure scaremongering.

As you were one of the most strident voices saying EXACTLY the same thing about Coronavirus, sneering at anyone who suggested it was shaping up to be a problem, I am entirely confident that anything you now have to say about the economic consequences is definitely going to be wrong.

You can't keep placing the wrong bets, while insulting the people who keep getting it right, without eventually undermining your own credibility. Seriously, @saengd, have you no shame?

 

[saengd]

Just now, Pravda said:

 

Well you certainly painted quite a rosy picture.

 

 

No, the picture is not rosy, it just looks that way when you compare the facts against what some posters imagine!

 

Make no mistake the banks will get stressed, that's what Capital Adequacy Ratio's and stress testing are for and that's the real test of a Central Bank to manage such things.

[saengd]

1 minute ago, donnacha said:

As you were one of the most strident voices saying EXACTLY the same thing about Coronavirus, sneering at anyone who suggested it was shaping up to be a problem, I am entirely confident that anything you now have to say about the economic consequences is definitely going to be wrong.

You can't keep placing the wrong bets, while insulting the people who keep getting it right, without eventually undermining your own credibility. Seriously, @saengd, have you no shame?

 

"As you were one of the most strident voices saying EXACTLY the same thing about Coronavirus, sneering at anyone who suggested it was shaping up to be a problem".

 

Only in your overly vivid imagination is that true, unless of course you can support anything you claim with a hint of fact and supporting evidence......no, I thought not!

[Pravda]

Just now, saengd said:

No, the picture is not rosy, it just looks that way when you compare the facts against what some posters imagine!

 

Make no mistake the banks will get stressed, that's what Capital Adequacy Ratio's and stress testing are for and that's the real test of a Central Bank to manage such things.

 

Facts are I'm in a third world country and am yet to hear something that is lot a lie. 

 

Even in good times when there were rallies back in 2014 against Taksin there was a talk about certain bank going down. My ex wife pulled 3 million and so did many other customers. 

 

 

[donnacha]

7 minutes ago, Pravda said:

Well you certainly painted quite a rosy picture.

Probably mostly wish-fulfillment, if his bank does collapse he's in deep trouble:
 

21 minutes ago, saengd said:

over the past ten years I have held up to 90% of my liquid wealth in Thai. banks in Thailand, I'm currently holding 76% here, that is over 60% of my total assets.

I'm guessing that 76% of his "liquid wealth" is the 400K he needs to keep renewing his marriage visa. His "assets" outside Thailand is the caravan back home he hasn't managed to sell yet.


 

Edited March 26, 2020 by donnacha

[saengd]

2 minutes ago, Pravda said:

 

Facts are I'm in a third world country and am yet to hear something that is lot a lie. 

 

Even in good times when there were rallies back in 2014 against Taksin there was a talk about certain bank going down. My ex wife pulled 3 million and so did many other customers. 

 

 

 

No, you are in a developing economy, the term third world ceased to be of relevance after the cold war.

 

Your comment about rumors of a bank failure during civil unrest in 2014 needs no further explanation.

 

[spiekerjozef]

Did many of the so called banks closed in 2008 during the financial crisis which they caused? Nope.

Only in Iceland they put those bankers in prison, the rest of the world let them get away with it. Did nothing.

So unlikely a bank goes down.

[BritManToo]

9 minutes ago, donnacha said:

I'm guessing that 76% of his "liquid wealth" is the 400K he needs to keep renewing his marriage visa. His "assets" outside Thailand is the caravan back home he hasn't managed to sell yet.

I wish I had a caravan back home!

[donnacha]

1 minute ago, BritManToo said:

I wish I had a caravan back home!

Me too! Right now it would be handier than my Bitcoins ????

[BritManToo]

52 minutes ago, ChipButty said:

lots of guys on here all have money in some Thai banks

BKB phone app working again ........ 20k moved to TMB just in case.

Don't want yesterday's silliness happening again.

 

[david555]

Depending the time frame up to my ret ext. Date for renuwing i would have to open a new bank account to transfer in a new 800 k from my abroad home country bank ...

..that would be the most urgent problem as the 2 months seasoning would have to be respected!

 

As needed time to recover and claim from guarantee funds collapsed bank

[saengd]

1 minute ago, david555 said:

Depending the time frame up to my ret ext. Date for renuwing i would have to open a new bank account to transfer in a new 800 k from my abroad home country bank ...

..that would be the most urgent problem as the 2 months seasoning would have to be respected!

 

As needed time to recover and claim from guarantee funds collapsed bank

You don't think if a bank were to collapse and you were waiting for a payout from the DPA that the government /Immigration might give you a pass? I think there's  reasonable chance they might.

[LennyW]

I think it is about time i started manufacturing tinfoil hats, sure seems to be a need for them!!

[Orton Rd]

My Thai bank is mainly owned by the Japanese so not as bothered

[saengd]

Just now, Orton Rd said:

My Thai bank is mainly owned by the Japanese so not as bothered

Bank of Ayudhya? (sp)

[worgeordie]

If one Bank goes down,then it will be another,then the next one,

it will be like a row of dominoes going down,is that what you want

to hear.

 

regards Worgeordie

[bkk6060]

11 minutes ago, BritManToo said:

BKB phone app working again ........ 20k moved to TMB just in case.

Don't want yesterday's silliness happening again.

 

Gosh, that is 2 months of living for you.

Good preparation way to go.

????

[Orton Rd]

1 minute ago, saengd said:

Bank of Ayudhya? (sp)

That's the one

[Pravda]

30 minutes ago, saengd said:

 

No, you are in a developing economy, the term third world ceased to be of relevance after the cold war.

 

Your comment about rumors of a bank failure during civil unrest in 2014 needs no further explanation.

 

 

The thread title is what would happen if a bank goes down.

 

I have every right to share my view based on the previous track record and experience. 

 

The bank is in a great shape until it is not. I think 2008 crisis proves this quite nicely. Ironically you mention certain credit agencies that give Thai banks super duper credibility. 

 

https://en.wikipedia.org/wiki/Credit_rating_agencies_and_the_subprime_crisis

 

https://www.theguardian.com/business/2017/jan/14/moodys-864m-penalty-for-ratings-in-run-up-to-2008-financial-crisis

 

 

edit:

 

No, I don't think there will be bank run in Thailand, but OP asks a valid question.

Edited March 26, 2020 by Pravda

[Pravda]

6 minutes ago, saengd said:

Bank of Ayudhya? (sp)

 

Virus bank. First bank to go down.

 

Kidding ????

[saengd]

4 minutes ago, Pravda said:

 

The thread title is what would happen if a bank goes down.

 

I have every right to share my view based on the previous track record and experience. 

 

The bank is in a great shape until it is not. I think 2008 crisis proves this quite nicely. Ironically you mention certain credit agencies that give Thai banks super duper credibility. 

 

https://en.wikipedia.org/wiki/Credit_rating_agencies_and_the_subprime_crisis

 

 

edit:

 

No, I don't think there will be bank run in Thailand, but OP asks a valid question.

Chill out and read what I wrote again and stop getting excited.

[morrobay]

30 minutes ago, saengd said:

 

No, you are in a developing economy, the term third world ceased to be of relevance after the cold war.

 

Incorrect, the term 2nd world Is irrelevant now and was referring to communist countries. Third World, developing countries and First World are the relevant current terms. 

[Pravda]

9 minutes ago, saengd said:

Chill out and read what I wrote again and stop getting excited.

 

What else am I going to do than argue on the internet? Can't go anywhere 

[BritManToo]

17 minutes ago, bkk6060 said:

Gosh, that is 2 months of living for you.

Good preparation way to go.

????

If you're not allowed to go out the house, you don't need much money.

I bought a 45Kg sack of Jasmine rice for 1,300bht, so that's emergency food taken care of.