Change to deposit protection at Thai banks will have little impact

[webfact]

Picture: Daily News

 

Kasikorn bank's research center said that the government's change in policy regarding account protection will have little effect.

 

The government have changed the amount they will cover in the event of a bank's collapse from 5 million  to one million effective from today. 

 

The move has been years in the making and is not a result of the pandemic or other factors related to Covid-19.

 

Investors and account holders have been aware of its introduction for the best part of a decade.

 

Fundamentals in the banking sector remain strong said Kasikorn in a report picked up by Daily News. 

 

In fact far from savings going down as a result they are expected to go up in 2021 by between 3.5 to 4.5%.

 

This is inline with earlier predictions of a 3.6% rise made in June. 

 

The research center noted that the majority of accounts do not have one million baht in them and these have seen the greatest fall in savings in the pandemic.

 

Accounts over one million baht continue to rise and will be the greatest driver of increases in savings in Thai banks. 

 

-- © Copyright  ASEAN NOW 2021-08-11

 

- Whatever you're going through, the Samaritans are here for you

- Follow ASEAN NOW on LINE for breaking COVID-19 updates

[2umich]

So they were waiting for decade to reduce deposit guarantee and decided do it now, when a lot of people unable to pay they debt. Perfect timing. Nothing to worry about.

[jacko45k]

Just now, 2umich said:

So they were waiting for decade to reduce deposit guarantee and decided do it now, when a lot of people unable to pay they debt. Perfect timing. Nothing to worry about.

It was announced some time ago scheduled for this month.

[DLock]

I have not kept up with this, but what is the logic behind doing this?

 

It certainly doesn't inspire confidence or want me to hold too much money in the Thai banking system.

[Mickeymaus]

"Fundamentals in the banking sector remain strong said Kasikorn in a report picked up by Daily News." 

 

Normally banks will not announce before their closure that they have problems. People would start immediately to withdraw their deposits otherwise. So I never listen to their statements. Even rating agencies cannot be trusted as history showed already.

[inThailand]

In the USA the FDIC insures accounts to $250,000, LOS 1M THB or about $33,000.

Cheap Charlies in a riskier environment? TIT. 

[brucegoniners]

Oh really? Sounds like wishful thinking from Thai banks, especially since a Thai bank wrote this, lol

 

Of course most Thais don't have a million baht in their account. We do.

 

My wife and I were talking yesterday about opening a second account at another bank to spread our money around and not be over the one million baht threshold. So whether they know it or not, there will be changes.

 

However I doubt it will affect any one bank, since all banks will be affected, losing and gaining from it rather equally.

 

If any banks will benefit it's likely to be some of the lesser known banks who will get deposits they wouldn't otherwise have. Just my humble opinion.

[jacko45k]

Just now, inThailand said:

In the USA the FDIC insures accounts to $250,000, LOS 1M THB or about $33,000.

Cheap Charlies in a riskier environment? TIT. 

It is worse than that, you stated individual accounts in the case of the USA. In Thailand, it will be per individual account holder... ie my 2 accounts with the bank only have a total protection limit of 1M THB.

[prakhonchai nick]

4 minutes ago, brucegoniners said:

Oh really? Sounds like wishful thinking from Thai banks, especially since a Thai bank wrote this, lol

 

Of course most Thais don't have a million baht in their account. We do.

 

My wife and I were talking yesterday about opening a second account at another bank to spread our money around and not be over the one million baht threshold. So whether they know it or not, there will be changes.

 

However I doubt it will affect any one bank, since all banks will be affected, losing and gaining from it rather equally.

 

If any banks will benefit it's likely to be some of the lesser known banks who will get deposits they wouldn't otherwise have. Just my humble opinion.

Some of the smaller banks pay a slightly higher interest rate. However some are reluctant to open an account for a foreigner-especially one without a work permit.  One of the smaller banks in a shopping mall refused to open an account for me event though I have PR.. "No sir"..."We need to see a work permit and a visa"

[Mickeymaus]

4 minutes ago, brucegoniners said:

Oh really? Sounds like wishful thinking from Thai banks, especially since a Thai bank wrote this, lol

 

Of course most Thais don't have a million baht in their account. We do.

 

My wife and I were talking yesterday about opening a second account at another bank to spread our money around and not be over the one million baht threshold. So whether they know it or not, there will be changes.

 

However I doubt it will affect any one bank, since all banks will be affected, losing and gaining from it rather equally.

 

If any banks will benefit it's likely to be some of the lesser known banks who will get deposits they wouldn't otherwise have. Just my humble opinion.

I guess many people will move to the Government Savings Bank for instance. If I can open an account there as foreigner I will be one of them. I wait for the branches in the mall to open again to clarify everything. Another bank might be Krung Thai.

[darrenr]

BS ! We are going to have a global crash in the order of 65-80%,the banks know this, before anyone calls me a quak , do you honestly think that given the recent pandemic, insane QE /money printing that there will not be consequences? Inflation will be out of control and the central banks will start to tighten to try and control inflation, Interest rates will rise and crush the economy. Don’t have money in Thai  banks that you can’t afford to lose ! Think Asia Crisis !

We are the most overvalued market since 1929 (Great Depression), do your research if you don’t believe me !

Edited August 11, 2021 by darrenr

[Boarn]

With inflation so high and interest rates so low keeping any more than an emergency fund in cash is not the best idea anyway.

[david555]

41 minutes ago, 2umich said:

So they were waiting for decade to reduce deposit guarantee and decided do it now, when a lot of people unable to pay they debt. Perfect timing. Nothing to worry about.

This timing was published many years ago already in different steps , even the last 1 million was already postponed on the normal limitation day ..... , it was long time already published , only now we all look something behind it  because covid and bad economics  , which was 5 years ago not even known about it  ..... ????

Edited August 11, 2021 by david555

[david555]

50 minutes ago, jacko45k said:

It was announced some time ago scheduled for this month.

Even in totality i saw the planning in steps almost 5 years ago from very high to present timing, with even the last 1 million baht limit postponed with one year . And now activated .

 

I wish i did not deleted that schedule layout , it would prove it was a long time planning ....!

Edited August 11, 2021 by david555

[EricTh]

26 minutes ago, jacko45k said:

It is worse than that, you stated individual accounts in the case of the USA. In Thailand, it will be per individual account holder... ie my 2 accounts with the bank only have a total protection limit of 1M THB.

What about 2 accounts in two different bank? Can that be more than 1M THB?

[Percy P]

55 minutes ago, DLock said:

I have not kept up with this, but what is the logic behind doing this?

 

It certainly doesn't inspire confidence or want me to hold too much money in the Thai banking system.

Get more then one bank account

[EricTh]

23 minutes ago, darrenr said:

BS ! We are going to have a global crash in the order of 65-80%,the banks know this, before anyone calls me a quak , do you honestly think that given the recent pandemic, insane QE /money printing that there will not be consequences? Inflation will be out of control and the central banks will start to tighten to try and control inflation, Interest rates will rise and crush the economy. Don’t have money in Thai  banks that you can’t afford to lose ! Think Asia Crisis !

We are the most overvalued market since 1929 (Great Depression), do your research if you don’t believe me !

So what's the best way to park our money?

 

[jacko45k]

2 minutes ago, EricTh said:

What about 2 accounts in two different bank? Can that be more than 1M THB?

Yes, each bank offers 1 Mil Cover, (but not on FCDs I believe).

[david555]

1 minute ago, EricTh said:

What about 2 accounts in two different bank? Can that be more than 1M THB?

yes as stated in this 

Thai deposit protection act..pdf

[topt]

 

8 minutes ago, david555 said:

wish i did not deleted that schedule layout , it would prove it was a long time planning ....!

Here is a page from 2011 where it says from 2012 it was going from 50m to 1m in 2012......

http://thailawforum.com/thai-deposit-insurance-law.html

 

I can't find the more recent updates (many on Thaivisa) showing the progression after that.

[topt]

2 minutes ago, jacko45k said:

Yes, each bank offers 1 Mil Cover, (but not on FCDs I believe).

Correct

[Liverpool Lou]

1 hour ago, 2umich said:

So they were waiting for decade to reduce deposit guarantee and decided do it now, when a lot of people unable to pay they debt. Perfect timing. Nothing to worry about.

The people you refer to as being unable to pay their debts are not going to be affected by the DPA guarantee which safeguards accounts with up to B1,000,000 in them!   

 

How does the reduction in the level of protection affect anyone when there are no banks going bust?

[Nickelbeer]

When the banks give you a warning and you choose to ignore it, you have no one but yourself to blame when you lose all your money. I keep just enough in the bank to keep the account open.

[david555]

Just now, topt said:

 

Here is a page from 2011 where it says from 2012 it was going from 50m to 1m in 2012......

http://thailawforum.com/thai-deposit-insurance-law.html

 

I can't find the more recent updates (many on Thaivisa) showing the progression after that.

Oh Thank you ???? ,as all seems now to panic it is because Covid ....NO ! it was a very long time planning.

 

 

Thank you once more to help me out as i deleted that nice graphic picture who showed it very simple way 

[Iforbach]

I know everyone is up to date but just to say I was in krungski bank today and if you hv 2 etc different account..as mentioned collectively only 1 million is covered.. anybody hv any idea how good back up is on these thai banks I'm not savvy on this stuff 

[jacko45k]

1 minute ago, Nickelbeer said:

When the banks give you a warning and you choose to ignore it, you have no one but yourself to blame when you lose all your money. I keep just enough in the bank to keep the account open.

That hardly fits the bill with respect to having a retirement extension. Nor those wishing to self insure against a medical emergency, rather than shelling out 50-100,000 baht every year.

[Liverpool Lou]

3 minutes ago, Iforbach said:

anybody hv any idea how good back up is on these thai banks

What does that mean?   "How good back up is"?

[david555]

10 minutes ago, jacko45k said:

Yes, each bank offers 1 Mil Cover, (but not on FCDs I believe).

No foreign money accounts are covered for deposit protection ....

 

 

[topt]

3 minutes ago, Iforbach said:

I know everyone is up to date but just to say I was in krungski bank today and if you hv 2 etc different account..as mentioned collectively only 1 million is covered.. anybody hv any idea how good back up is on these thai banks I'm not savvy on this stuff 

read the pdf that David posted earlier in the thread or go here and have a mosey around -

https://www.dpa.or.th/en/site/index and somewhere they explain how it all works. 

For solvency levels on individual Thai banks you need to look at other sources.

[Nickelbeer]

1 minute ago, jacko45k said:

That hardly fits the bill with respect to having a retirement extension. Nor those wishing to self insure against a medical emergency, rather than shelling out 50-100,000 baht every year.

That's why I use an agent. I am not importing 65 thousand baht into Thailand merely to get an extension. Agents mitigate that problem quite nicely. While paying 500 dollars to be allowed to spend your money in Thailand is a ripoff, it is my only option until the Covid insanity ends and I can move to more welcoming shores.