What would happen if a Bank goes down?

[Rimmer]

Troll post removed, discuss the topic not other members please

[Proboscis]

8 hours 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 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.

 

As the 2008 financial crisis tells us, while bad loans are not great, what leads to widespread collapse are things like instruments that allow those who cannot afford property to buy property. In 2008, this was insurance policies that were bundled but where there was no spread of risk. None of this is happening now. The banks will be forced to back off foreclosing on clients - either by the government (such as in France) or by circumstances. Going after clients now would be impossible and certainly stupid for a bank when it is not really possible for a client to sell quickly. Much better to wait. Banks may be many things but they are not usually so stupid.

[BritManToo]

Just now, Proboscis said:

As the 2008 financial crisis tells us, while bad loans are not great, what leads to widespread collapse are things like instruments that allow those who cannot afford property to buy property. In 2008, this was insurance policies that were bundled but where there was no spread of risk. None of this is happening now. The banks will be forced to back off foreclosing on clients - either by the government (such as in France) or by circumstances. Going after clients now would be impossible and certainly stupid for a bank when it is not really possible for a client to sell quickly. Much better to wait. Banks may be many things but they are not usually so stupid.

It's not as if the Thai banks books are full of defaulting home loans and repossessed properties still valued at the full outstanding loan amounts is it.

 

There's so much outstanding credit in Thailand, that something could very easily give IMHO.

[itsallmine68]

YEAP Thinking tooooo MUTCH Unless there is a Bank Representative here on Thai Visa and I doubt that very much Why would you ask 80 or maybe more Keyboard Jockeys?

Best to take questions like this one to the source, YOUR BANK

[saengd]

7 minutes ago, BritManToo said:

It's not as if the Thai banks books are full of defaulting home loans and repossessed properties still valued at the full outstanding loan amounts is it.

 

There's so much outstanding credit in Thailand, that something could very easily give IMHO.

Non-performing loans Thailand, including consumer mortgages.

 

https://www.nationthailand.com/business/30382364

[Lacessit]

6 minutes ago, BritManToo said:

It's not as if the Thai banks books are full of defaulting home loans and repossessed properties still valued at the full outstanding loan amounts is it.

 

There's so much outstanding credit in Thailand, that something could very easily give IMHO.

Thai banks have it easy, they are paying piddling amounts in interest to depositors ( yes, including the 400/800K baht crowd ) while lending money out at about 7%. Australian banks would kill for that kind of interest margin.

[Nakdontree]

2 hours ago, Lacessit said:

Thai banks have it easy, they are paying piddling amounts in interest to depositors ... while lending money out at about 7%.

arrrrrrgh, there are still people around who believe that today's banking system works as it did 200 years ago. ????‍♂️????????‍♀️

Lending money nowadays has nothing to do with money deposits. These are two completely isolated types of transactions.

With all due respect, please learn about Fractional-reserve Banking and about Money Creation

then come back here and try again.

Edited March 26, 2020 by Nakdontree

[Accidental Tourist]

Until August 11, 2020 this would be 5 million baht per customer, per bank; after only 1 million is protected.

Better than 1997 where I lost a quarter million USD in a Thai finance company.

From August onward you should spread over 1 million deposits over several banks in Thailand. 

[saengd]

4 minutes ago, Nakdontree said:

arrrrrrgh, there are still people around who believe that today's banking system works as it did 200 years ago. ????‍♂️????????‍♀️

Lending money nowadays has nothing to do with money deposits. These are two completely isolated types of transactions.

With all due respect, please learn about Fractional-reserve Banking and about Money Creation

then come back here and try again.

We're all aware of what fractional reserve banking is, that's not the issue being described here. The issue is the spread between the rate of interest paid to retail banking customers and the rate of interest charged to them to borrow funds for mortgages etc, in Thailand that spread is massive.

[URMySunshine]

Thai Banks are pretty safe as they are owned by the big families that have very diversified interests and keeping their bank solvent will be important not just for their business but their face. That said farang money looks like a juicy honeypot to go a fishing to politically when all the dust has settled. The game plan for this government for domestic consumption seems firmly to have the focus on the 'dirty farang' trope to distract attention from the huge inequalities and massive corruption at the top on an epic scale. 800,000 sound like an unusual amount a rounded 1 million could be the next move , but who knows they are definitely boiling the frog slowly though. 

[Isaan sailor]

Wife and I have pondered the same.  Once my balance hits a certain level at Bangkok Bank, we will start new extra deposits at our Siam Bank account.

Siam Bank partially owned by the Royal family.  We think our money will be safe there—come Hell or high water.

of course with today’s USD sinking—we will stop investing in Thailand.

[Matzzon]

6 hours ago, Lacessit said:

I put that in because I was reminded of children in the sandpit squabbling over whose turn it was with the bucket.

Sandpit? Bucket? Children? Can you please remind me what relevance they have to this thread?

[Lacessit]

1 hour ago, Nakdontree said:

arrrrrrgh, there are still people around who believe that today's banking system works as it did 200 years ago. ????‍♂️????????‍♀️

Lending money nowadays has nothing to do with money deposits. These are two completely isolated types of transactions.

With all due respect, please learn about Fractional-reserve Banking and about Money Creation

then come back here and try again.

Why would I? Had an American Express credit card about 30 years ago, cut it up because it was BS. Last time I was in debt was 1974. Solvent ever since.

With all due respect, a lot of the world's current financial problems are related to ever more complex debt structures. I'm happy to stick with the Micawber philosophy.

[landosmiles]

1 hour ago, Accidental Tourist said:

Until August 11, 2020 this would be 5 million baht per customer, per bank; after only 1 million is protected.

Better than 1997 where I lost a quarter million USD in a Thai finance company.

From August onward you should spread over 1 million deposits over several banks in Thailand. 

What was the Thai finance company, @Accidental Tourist? Thanks...

[Logosone]

The key thing to remember is that even in the 2008 financial crisis the number of banks that failed was small, relative to the number of banks that did not.

 

Measures taken since then should make bank failure even less common.

 

I've just opened a Thai bank account.

[Susco]

2 minutes ago, Logosone said:

The key thing to remember is that even in the 2008 financial crisis the number of banks that failed was small, relative to the number of banks that did not.

 

Measures taken since then should make bank failure even less common.

 

I've just opened a Thai bank account.

The 2008 crisis didn't affect Thailand or the rest of Asia, and the number of banks that failed in the US (+400) was far from small.

 

Because they were bailed out by the government or taken over by other banks, doesn't mean they didn't fail.

[landosmiles]

6 minutes ago, Susco said:

The 2008 crisis didn't affect Thailand or the rest of Asia . . . 

Any sources that it didn't affect Thailand? One of the first images on the wikipedia page about it seems to indicate the same grouping between the US and Thailand: https://en.wikipedia.org/wiki/Financial_crisis_of_2007–08#/media/File:GDP_Real_Growth_in_2009.svg

 

10 minutes ago, Susco said:

Because they were bailed out by the government or taken over by other banks, doesn't mean they didn't fail.

This thread seems to be about worry that depositors' savings in Thai banks would be lost. As long as depositors' savings aren't lost, I don't think they would care if the bank got one of its competitor's names, or if the government took it over.

[baansgr]

3 hours ago, Lacessit said:

Thai banks have it easy, they are paying piddling amounts in interest to depositors ( yes, including the 400/800K baht crowd ) while lending money out at about 7%. Australian banks would kill for that kind of interest margin.

Thats nothing, new legislation came in last week by the FCA in UK that banks can charge up to 40% interest on arranged and un arranged overdrafts.....guess what, most are charging 39.9%....thieves....and to cap it all, they are now overing coronavirus overdrafts to every account holder of £300....base rate 0.25%.....how can a financial ombudsman agree to a rate of 40%.....disgusting.

[Susco]

10 minutes ago, landosmiles said:

Any sources that it didn't affect Thailand? One of the first images on the wikipedia page about it seems to indicate the same grouping between the US and Thailand: https://en.wikipedia.org/wiki/Financial_crisis_of_2007–08#/media/File:GDP_Real_Growth_in_2009.svg

 

This thread seems to be about worry that depositors' savings in Thai banks would be lost. As long as depositors' savings aren't lost, I don't think they would care if the bank got one of its competitor's names, or if the government took it over.

Of course every country in the world was affected in their GDP, what I mean is that Thai banks were not affected.

 

I was here in 1997 and I know of foreigners who lost their savings in Thai banks

[Max69xl]

16 hours 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. 

 

 

Who cares what your ex wife did?

You seem to be a worrier. Don't overthink everything.

[CharlieH]

Off topic post removed

[gk10002000]

23 hours ago, Pravda said:

Good question actually. 

 

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

and exactly how would one get the money?  800k baht direct deposited in some bank account you give them?  Would you get a paper check?  What if not in country at the time or for a while?  I think it would be a loss for many more than one might think

[ChipButty]

14 hours ago, marquis22 said:

"What would happen if a Bank goes down?"

My wife would be out of a job and have to stay home!!!

Lucky you

[saengd]

17 minutes ago, gk10002000 said:

and exactly how would one get the money?  800k baht direct deposited in some bank account you give them?  Would you get a paper check?  What if not in country at the time or for a while?  I think it would be a loss for many more than one might think

My guess is that refunds would work in a similar manner to tax refunds, the customer is sent a notice which they then take to a bank to confirm their identity and a money card is issued, that card is then used to withdraw funds from the card via an ATM. If a person is not in the country to receive that letter they will probably need to contact DPA, provide evidence of who they are and get a copy of the letter that way. 

 

Just because you don't understand precisely how the refund process would work is not really a valid reason to think it would result in loss, is it? 

[gk10002000]

23 minutes ago, saengd said:

My guess is that refunds would work in a similar manner to tax refunds, the customer is sent a notice which they then take to a bank to confirm their identity and a money card is issued, that card is then used to withdraw funds from the card via an ATM. If a person is not in the country to receive that letter they will probably need to contact DPA, provide evidence of who they are and get a copy of the letter that way. 

 

Just because you don't understand precisely how the refund process would work is not really a valid reason to think it would result in loss, is it? 

Jesus you love to attack people.  You are guessing on the process.  You are presuming it is similar to tax refunds.  Many if not most Retiree expats probably are not working so trying to compare to a tax refund system is pure conjecture. So whether one understands the process or not, and you certainly do not understand it because the process is unknown is a valid reason to think it could be a loss.  Do you think any part of Thailand infrastructure strongly favors Foreigners?

[saengd]

8 minutes ago, gk10002000 said:

Jesus you love to attack people.  You are guessing on the process.  You are presuming it is similar to tax refunds.  Many if not most Retiree expats probably are not working so trying to compare to a tax refund system is pure conjecture. So whether one understands the process or not, and you certainly do not understand it because the process is unknown is a valid reason to think it could be a loss.  Do you think any part of Thailand infrastructure strongly favors Foreigners?

There's no attack there I'm simply commenting on what you wrote, are you feeling delicate and fragile this morning or what!

 

Yes I'm guessing on the process, I said it was at the start so that dimwits would know it was guess and not a statement of fact. I offered my GUESS as to how DPA refunds might be issued using the current Thai tax refund method which works equally as well for foreigners as it does for Thai people, it's just a GUESS, if you have a different guess let's hear it.

Edited March 27, 2020 by saengd

[saengd]

I did some digging on the issue of refunds from DPA and came across an article in the newspaper whose name cannot be mentioned, google, DPA Pursues BOT nod to process refunds if you want to read it.

 

In outline the article says that DPA can refund money to depositors within 30 days using PromptPay. 

 

 

[Max69xl]

3 hours ago, gk10002000 said:

Jesus you love to attack people.  You are guessing on the process.  You are presuming it is similar to tax refunds.  Many if not most Retiree expats probably are not working so trying to compare to a tax refund system is pure conjecture. So whether one understands the process or not, and you certainly do not understand it because the process is unknown is a valid reason to think it could be a loss.  Do you think any part of Thailand infrastructure strongly favors Foreigners?

This thread is about what happens if a bank goes down. BoT and every Thai bank follows international banking regulations and until August this year up to 5 million baht is covered,then it's 1 million baht. Only very ignorant people, pessimistic people and conspiracy theorists (you can find all three categories here on TV) are worried about this and can't sleep. 

[BritManToo]

4 hours ago, gk10002000 said:

You are presuming it is similar to tax refunds.  Many if not most Retiree expats probably are not working so trying to compare to a tax refund system is pure conjecture.

Would point out most of us retired folk pay tax on our pensions.

I'm looking forward to a Brit tax refund at the end of this month for the 2019-2020 tax year.

 

As for the Thai banking system, apart from day to day spending and a small COVID-19 reserve, my money is in my UK bank.

Edited March 27, 2020 by BritManToo

[spidermike007]

There is an awful lot of panic going around. Personally, I have no fear of the Thai banks going bust. They are very secure, they are very conservative, and they do not engage in some of the very risky behavior some of the large American banks engage in. Not an issue for me at all. I have other things to worry about, that are far more relevant. And they are not related directly to catching Covid, but rather the economic devastation that is happening due to Covid, alot of which I consider inane at best. 

Edited March 27, 2020 by spidermike007