banks aren't guaranteeing deposits

[Tchooptip]

So the Thai billionaires keep their money in Thailand under their mattress ?

[rwill]

It's better than no insurance at all...

[KKr]

14 hours ago, Ron jeremy said:

Anyone keeping large sums of money in Thailand is nothing short of an idiot.

Thanks Mate.

what is a large sum in your expert opinion ?

[JBChiangRai]

I read the small print in this deposit guarantee scheme and it’s ambiguous whether it applies to foreigners 

[Pib]

1 minute ago, JBChiangRai said:

I read the small print in this deposit guarantee scheme and it’s ambiguous whether it applies to foreigners 

Show us that fine print.

 

In the meantime, from the DPA.

 

http://www.dpa.or.th/en/articles/view/who-is-protected

 

Quote

 

Who is protected?

     Individual depositors are automatically protected upon opening a deposit account with a financial institution as prescribed in the Deposit Protection Agency Act B.E. 2551 (2008). Protection is based on a per depositor per institution basis, meaning that all of an individual’s deposit accounts across all branches of that financial institution will be aggregated into a single amount.

     Juristic depositors such as companies, funds, foundations, temples, associations, and cooperatives are also protected in the same manner as individual depositors.
     Foreigners with Thai baht deposit accounts at member financial institutions in Thailand are also protected under the Deposit Protection Agency Act. However, “Non-Resident Baht Accounts” as defined in the Exchange Control Act B.E. 2485 (1942) are not protected
 

Remark:

A “Non-Resident Baht Account” is a special type of deposit account denominated in Thai baht that is used solely for transactions as specified in the Exchange Control Act. A “Non-Resident” means:

1)  Corporations, institutions, funds, financial institutions or juristic persons located outside Thailand.
2)  Entities of foreign governments located outside Thailand.
3)  Branches and agents of domestic juristic persons located outside Thailand
4)  Natural persons not of Thai nationalities and not having alien identity or residence permits.

However, “Non-Residents” exclude:

1)  Thai embassies, Thai consulates or other entities of Thai government located outside Thailand.
2)  Foreign embassies, foreign consulates, specialized agencies of the United Nations, international organizations or institutions (both financial and non-financial) located in Thailand.
3)  Branches and agents of foreign juristic persons located in Thailand.

 

 

 

 

 

 

[Pib]

And please note Foreign Currency Deposit (FCD)...that is, folks who have USD, GBP, EUR, etc., accts are not covered; only accts in Thai baht are covered.

 

http://www.dpa.or.th/en/articles/view/protected-deposit-products

 

 

Quote

 

Protected Deposit Products

     Protected deposit products are deposit accounts that are opened at member financial institutions under the Deposit Protection Agency Act. They must be denominated in Thai baht and must be opened within the country. Currently, there are 5 types of protected deposits:

• Current deposit accounts
• Savings deposit accounts
• Fixed deposit accounts
• Certificates of deposit
• Deposit receipts

     Financial products or certain deposit products that are not protected include:

• Foreign currency deposit accounts
• (SSF, RMF) Money invested in bonds, debentures, mutual and tax-saving funds (SSF and RMF)
• Deposits in cooperatives
• Cashier’s cheques and bills of exchange
• Electronic money (e-money)
• Savings insurance products offered by insurance companies

 

•  

[Pib]

And to increase your coverage it's best not to have all your money with only one bank like Bangkok Bank, Kaiskorn Bank, SCB, Krungsri Bank, etc. And having all your money in multiple branches of the same bank, like having money in Branch A and Branch B of Bangkok Bank, counts as having your money in only one bank....one institution.   

 

Since the max coverage is going to be Bt1M come 11 Aug 2021 if you are going to have more than Bt1M in your acct(s) you should consider splitting it among banks/institutions to increase your coverage.  Like keep Bt2M evenly split between two banks to have Bt2M coverage....three banks for Bt3M coverage....etc.

 

 

http://www.dpa.or.th/en/articles/view/protection-limit

Quote

 

What's the coverage limit

     If a member financial institution’s license is revoked, depositors of that institution will receive their deposits from the Deposit Protection Agency up to the coverage limit. The coverage is based on a per depositor per institution basis (not one account per institution), meaning that depositors with multiple accounts across all branches of that institution will have those deposits - both principal and interest - aggregated into a single amount.
The current coverage limit is 5 million baht until 10 August 2021. From 11 August 2021 onward, the coverage limit will be 1 million baht.

 

 

[Pib]

And what about "joint" owned accts with the coverage rule being:

 

Quote

The coverage is based on a per depositor per institution basis (not one account per institution), meaning that depositors with multiple accounts across all branches of that institution will have those deposits - both principal and interest - aggregated into a single amount.

 

Well, below is an example....keep in mind the example is based on when the coverage was Bt15M...it's now down to Bt5M...and going to Bt1M next year/11 Aug 2021

 

http://www.dpa.or.th/en/file/download/khumux-tham-txb-phasa-xangkvs

[Max69xl]

19 hours ago, ukrules said:

I believe this has been delayed.

 

It's deposit insurance. If they go bankrupt then you get a maximum of 1 million Baht back via the insurance scheme.

 

If you have a balance of 10 million then you get 1 million, it's as simple as that.

 

Why have they been reducing this coverage in stages over the years is the real question here......?

The deposit guarantee is still 5 million baht. They were supposed to decrease it to 1 million in August this year but they extended it 1 more year. 

[Jaxxper]

20 hours ago, ukrules said:

Why have they been reducing this coverage in stages over the years is the real question here......?

Until August I believe it was Thb 5.0 Million. SCB told me this about 3 months ago before it was reduced to Thb 1.0

[ChipButty]

Only the other week the government are telling farang must have 3 million Baht in a bank account

[fangless]

10 minutes ago, ChipButty said:

Only the other week the government are telling farang must have 3 million Baht in a bank account

Only for a specific type of visa/incentive.  It is NOT for standard visas/extensions.

[baansgr]

18 hours ago, VBF said:

Presumably, it's 1 mil per institution ie 1 mil with SCB + 1 mil with Kasikorn etc.? If so possible to mitigate some risk that way.

 

Sorry for Thai people who have no choice, but really any foreigner who keeps lots of dosh in what is still, essentially a 3rd world banking system isn't very smart. Having seen the pitiful security, both personal and electronic practised in Thailand I don't think I'd keep any more than essential even if i did live there.

 

Especially seeing how easy it is today to transfer from a better-protected account Eg UK is  £85K per institution - approx 3,655,000 Baht. I presume the interest rates in Thailand are as pathetically low as other countries - I haven't bothered to look as it doesn't affect me.

The banking system is way ahead of anything in UK. OTPs have been in Thailand almost 10 years...internet banking is far superior and easier. Instant transfers as long as I can remember but UK was 3 working days until only a few years ago....Thai Banks win hands down for me....

[Brunolem]

22 minutes ago, baansgr said:

The banking system is way ahead of anything in UK. OTPs have been in Thailand almost 10 years...internet banking is far superior and easier. Instant transfers as long as I can remember but UK was 3 working days until only a few years ago....Thai Banks win hands down for me....

This has nothing to do with the financial health of these banks.

[fangless]

43 minutes ago, baansgr said:

but UK was 3 working days until only a few years ago.

Wrong!!    CHAPS/FPS,  was introduced in 1984,

Faster Payments Service (FPS) is a United Kingdom banking initiative to reduce payment times between different banks' customer accounts to typically a few seconds, from the three working days that transfers usually take using the long-established BACS system. 

Edited October 18, 2020 by fangless

[fangless]

13 minutes ago, Brunolem said:

The banking system is way ahead of anything in UK. OTPs have been in Thailand almost 10 years

OTP's have been in use in Europe for nearly 20 years and  have been subject to hacks in the US and Europe since 2005/6.

I used to work in UK internet/telephone banking security!

 

[gentlemanjackdarby]

9 hours ago, Brunolem said:

The only problem is that the FDIC doesn't have the money to cover its promises...by a long shot...

 

Otherwise, deposits in Thai banks are insured up to 5 million baht until August 2021...we'll see after that.

 

Some banks, like the Bangkok Bank for example, also have their own insurance...up to one million baht in this case.

 

It is a simple reflex that leads foreigners to believe that "their" banks are safer, just because "their" country is safer.

 

Non biased economic studies show that the reality is different, and that the banks in the worst financial situation are not in Thailand, but in Europe.

 

As for the governments coming to the rescue, European countries are far more broke than Thailand, with their national debts around 100% of GDP, against less than 60% for Thailand.

 

Anyway it is the central banks, and not the governments, who supervise and come to the rescue of the banks, if necessary.

The FDIC doesn't have to have "the money" sitting in a bank somewhere or under the proverbial mattress for a couple of reasons:

 

The FDIC and various Federal bank regulators exercise such strict oversight of U.S. banks that when a bank gets into trouble, "the machine" is so well-oiled that usually what happens is that "Failing Bank" closes it's doors Friday evening and "Healthy Bank", after working with bank regulators to buy "Failing Bank", puts up it's sign over the weekend and is open for business first thing Monday morning, depositors not really being aware, or caring, about what has happened. No long lines of worried depositors, no frozen accounts, no "wait, you'll get your money in a little while" BS, nothing but business as usual. It's not the 1930s anymore

 

U.S. banks' balance sheets are made up of a lot more than "cash", i.e., banks have assets that are easily transferred and whose value is set by the markets, not by the management skills, or lack thereof, of a particular bank and it's branches; same goes for a banks liabilities, such as deposits. So if a particular bank doesn't meet regulator standards, there's usually another bank that will buy the assets, assume the liabilities, and be more than happy to set up shop. The FDIC doesn't have to do any, or very little, "bailing out"

 

And the biggest reason is that if things got so bad nothing else worked, the U.S. government would step in and provide liquidity and it has demonstrated on several occasions going back to 2008 that it has both the means and will to do so

[fangless]

20 minutes ago, gentlemanjackdarby said:

And the biggest reason is that if things got so bad nothing else worked, the U.S. government would step in and provide liquidity and it has demonstrated on several occasions going back to 2008 that it has both the means and will to do so

As did the UK with Northern Rock and The Royal Bank of Scotland (RBS) takeovers and bailouts of other banks in October 2008.

[Peterphuket]

When you have cash....buy gold it is still the only thing you can trust.

[ICELANDMAN]

9 minutes ago, Peterphuket said:

When you have cash....buy gold it is still the only thing you can trust.

Be careful not to buy fake gold, there are several tons in Asia

[mr mr]

you're using a bank as a storage place for your value now ? good grief. 

 

get a nano ledger and get usdt. 

[fangless]

11 minutes ago, mr mr said:

you're using a bank as a storage place for your value now ? good grief. 

 

get a nano ledger and get usdt. 

So go and store all your so called money in a USB stick!  No thanks.

[JimGant]

23 hours ago, ukrules said:

Why have they been reducing this coverage in stages over the years is the real question here......?

Maybe this article from the Harvard Business Review can shed some light:

 

Quote

What’s more, as a result of the increase in insurable limits to $250,000, regulators have lost the help of a savvy group of private monitors. When insured deposits were limited to $100,000 per account, corporations and wealthy individuals would look closely at the financial condition of a bank before making deposits over that limit. In turn, the executives of the bank would bolster its financial condition to attract monies from such sophisticated depositors.

https://hbr.org/2009/10/fixing-the-fdic

 

[fangless]

43 minutes ago, JimGant said:

Maybe this article from the Harvard Business Review can shed some light:

Not to me it don't! I don't speak double Dutch

[Leaver]

1 hour ago, Peterphuket said:

When you have cash....buy gold it is still the only thing you can trust.

Keep listening to your Thai missus and the next thing you will be posting is, "Buy land in Issan." Followed by, and grow rubber trees on said land.   ????

[VBF]

4 hours ago, baansgr said:

The banking system is way ahead of anything in UK. OTPs have been in Thailand almost 10 years...internet banking is far superior and easier. Instant transfers as long as I can remember but UK was 3 working days until only a few years ago....Thai Banks win hands down for me....

As the saying goes.....Up to you ????

[Chris.B]

3 hours ago, fangless said:

Wrong!!    CHAPS/FPS,  was introduced in 1984,

Faster Payments Service (FPS) is a United Kingdom banking initiative to reduce payment times between different banks' customer accounts to typically a few seconds, from the three working days that transfers usually take using the long-established BACS system. 

27 May 2008

 

FPS was officially launched on 27 May 2008 (though testing during the previous week allowed users to process very small-value (1p) transactions as "faster payments") for non-scheduled, "immediate" payments (about 5% of traffic) only, with access for future-dated payments and standing orders from 6 June.

 

Faster Payments Service - Wikipedia

[fangless]

20 minutes ago, Chris.B said:

27 May 2008

 

FPS was officially launched on 27 May 2008 (though testing during the previous week allowed users to process very small-value (1p) transactions as "faster payments") for non-scheduled, "immediate" payments (about 5% of traffic) only, with access for future-dated payments and standing orders from 6 June.

 

Faster Payments Service - Wikipedia

That is the UK wide major high street bank inter FPS system.  Don't take Wiki as a Bible as it is not an authority on many things and does not know the details.!  

 

FYI FPS  started inside the then new CHAPS system as a branch to branch system between branches of the same banks with the introduction of CHAPS .  It certainly involved HSBC and I believe RBS were also doing inter branch use then.  It then expanded gradually bank wide until eventually the big four went interconnected in 2008.  Most of the rest of the UK & NI banks have now joined up.  

The point is that the post I commented on said  "only a few years ago". Which I take to be somewhat later than even 2008,

 

PS;  FYI In the UK you can now scan a cheque with your phone and be credited immediately.  But your funds can still be clawed back up to 8 working days as in the old system if the cheque eventually bounces!

 

PPS;  Standing orders as referenced in the WIKI article are rarely covered in the FPS as they normally come under BACS and also note that CHAPS/BACS/FPS/SDTs etc all have various payment levels and type of bank account restrictions/limitations.

 

PPPS;  Lets get back on to the actual subject please.

 

 

Edited October 18, 2020 by fangless

[CANSIAM]

23 hours ago, VBF said:

Presumably, it's 1 mil per institution ie 1 mil with SCB + 1 mil with Kasikorn etc.? If so possible to mitigate some risk that way.

 

Sorry for Thai people who have no choice, but really any foreigner who keeps lots of dosh in what is still, essentially a 3rd world banking system isn't very smart. Having seen the pitiful security, both personal and electronic practised in Thailand I don't think I'd keep any more than essential even if i did live there.

 

Especially seeing how easy it is today to transfer from a better-protected account Eg UK is  £85K per institution - approx 3,655,000 Baht. I presume the interest rates in Thailand are as pathetically low as other countries - I haven't bothered to look as it doesn't affect me.

Is Citibank considered 3rd world ??

[Leaver]

45 minutes ago, CANSIAM said:

Is Citibank considered 3rd world ??

Citibank Thailand, or Citibank USA?