Bangkok Bank Raises Deposit Rates On April 25, 2011

[george]

BBL raises rates

By The Nation

BANGKOK: -- Bangkok Bank, Thailand's largest bank, has adjusted deposit rates - from savings and fixed accounts to bills of exchange - by up to 0.625 percentage point.

Effective on April 25, the lending rates will also be raised by 0.125-0.25 percentage point.

All top four banks have raised the rates after the Bank of Thailand jacked up the policy rate by 0.25 percentage point on April 20.

-- The Nation 2011-04-24

[vahack]

its funny that the banks still think sub 2% rates are good. your money is better invested in gold - or even the SET

[TheGhostWithin]

I find that Thai financial institutions have a lot to learn from the Americans and particularly the Chinese. Inflation is already hitting from what I hear from my partner (she said the price of food is going up) - expect price rises on other things such as that BTS fare to go up. The last thing to go up will be salaries.

China is rapidly increasing its' interest rates to curb inflation, and Thailand is gradually increasing. This is not to help the consumers out, but rather to stop inflation - the side effect will be profit downgrades on businesses nationwide - meaning foreigners will withdraw investments in Thailand, which have higher risk and lower risk return.

This may have some effect on the Thai condominium market, which is a bubble waiting to burst from my studies.- price affordability and rental returns vs. purchase price ratios are way off in this market.

Edited April 24, 2011 by TheGhostWithin

[mccw]

American banks are the last people to they would want to copy!

Thai banks have much higher reserves to lending ratio than most of their western counter parts and it is the west who are now bringing in regulations to emulate this. Less risk and more stability.

Chinese have become overly keen lenders aswell on the property front which regulation there is attempting to temper.

The thai condo Market is far off bible status, nothing like what it is in china. Here the developers have been dropping prices and changing focus to more affordable units as the Market demands. Total different to say the spiralling upwards pre 08 crash seen in the west. If u think for example a 1.2-1.4 mil bht condo in change Mai could be rent at 8-10 k pm that'd b around a 6-10% return annually; not a bad return at all. Bangkok I've seen reasonably priced units which would produce a similar return, but like in Uk it's some what of a split Market where some people believe their property is worth far more than it really is; however the true value and what is actualy moving should b easy to see.

A bank is for sure the worst place to leave any decent amount of money for an extended period of time.

[TheGhostWithin]

American banks are the last people to they would want to copy!

Thai banks have much higher reserves to lending ratio than most of their western counter parts and it is the west who are now bringing in regulations to emulate this. Less risk and more stability.

Chinese have become overly keen lenders aswell on the property front which regulation there is attempting to temper.

The thai condo Market is far off bible status, nothing like what it is in china. Here the developers have been dropping prices and changing focus to more affordable units as the Market demands. Total different to say the spiralling upwards pre 08 crash seen in the west. If u think for example a 1.2-1.4 mil bht condo in change Mai could be rent at 8-10 k pm that'd b around a 6-10% return annually; not a bad return at all. Bangkok I've seen reasonably priced units which would produce a similar return, but like in Uk it's some what of a split Market where some people believe their property is worth far more than it really is; however the true value and what is actualy moving should b easy to see.

A bank is for sure the worst place to leave any decent amount of money for an extended period of time.

MCCW - fully agreed, the banks are the worst place to leave your money - unless there is a long term bear market in place, but I would be more likely to invest in term deposits than an on call account.

The American system, if they can stop the "big bonus" system is already improving on the Asian model. The past models were overscaled to risk but it is now the consumer rather than banks taking the risk. We do have to remember that what comes in fast can just as likely go out fast - hence the term "hot money". Hot money is Wen Jiabao's greatest worry right now, according to an article I read a week or so ago on Bloomberg.

Just because rental returns are high, does not make pricing levels correct - the market returns are dictated by demand, and when inflation rises, the cost of petrol goes up because the Thai Government can no longer afford to subsidise the cost of petrol andt the cost of everyday expenses continues up, you will see demand fall off.

It is just my opinion, I am waiting to see how things play out.

[asiawatcher]

My father gave me the advice years ago - "neither a lender or borrower be!". Having seen how banks can lend small amounts on properties yet ending up owning many times the value of the loans when hard times hit the borrower, I concur with his thoughts. Save, the when you have cash, pay for it - you can always strike a better deal. It may be slower in growth terms but you sure as hell don't give away your life to these crooked institutions who are bankrupting the world.

I aso concur with investment in tangible assets such as gold and (particularly) silver as the present fiat paper currency is not worth the paper it is written on. It also has no underlying value or support after most countries sold off their gold reserves. As soon as the US struggling inevitable fiscal collapse (and that is going to happen soon), with countries like China dumping USD in the billions, it is fair time for the world to reassess the Reserve Currency system. I for one could not care less if the rest of the world heads back into dark ages but sure as hell, the only way to survive is be unencumbered and be able to prove title to what you own.

[pisico]

I find that Thai financial institutions have a lot to learn from the Americans and particularly the Chinese. Inflation is already hitting from what I hear from my partner (she said the price of food is going up) - expect price rises on other things such as that BTS fare to go up. The last thing to go up will be salaries.

China is rapidly increasing its' interest rates to curb inflation, and Thailand is gradually increasing. This is not to help the consumers out, but rather to stop inflation - the side effect will be profit downgrades on businesses nationwide - meaning foreigners will withdraw investments in Thailand, which have higher risk and lower risk return.

This may have some effect on the Thai condominium market, which is a bubble waiting to burst from my studies.- price affordability and rental returns vs. purchase price ratios are way off in this market.

When the bubble bursts, the Chinese will come in droves to buy most of those condo-buildings as they have done in Vancouver and Western USA.

Do not think for a second that they will pay top THB. They will always drive a hard bargain. It's in their blood.

Just keep on scooping the water out of the boat!

[kutjebu]

Special the SET,because I made 65% last year.

its funny that the banks still think sub 2% rates are good. your money is better invested in gold - or even the SET

[nong38]

A comment on the condo situation and the like. They seem to be building like there is no tomorrow and the prices seem to be being plucked from the clouds, I heard recently about a new LK Hotel on the front in Pattaya charging 60,000bts a month. Does none of these people realize the world and especially the Europe/USA regions are in big financial trouble, who do they think will be able to pay for these items in that climate? Looks risky to me. Banks well the they will usually make their money at the ordinary mans expense. Its difficult to know what to do for the best, if you look at stock markets its a gamble, the markets are probably nearing the top of the current cycle, you may look for dividends and play it safe with the global or national big players,but, which market, I understand a bit about the UK market, but anywhere else I just dont have the knowledge and am at atime in life when I really cannot afford to gamble. It may be the best action may be to invest in a fund for this part of the world, prospects look better, but then you need good advice. Would get it here? Would it be better to get the fund in the UK or USA taking into account charges on same. Raising rates really does not help me and many others much I think.

[chuang]

its funny that the banks still think sub 2% rates are good. your money is better invested in gold - or even the SET

In Vietnam fixed deposit annual rate is about 12% or more....

[Dancealot]

its funny that the banks still think sub 2% rates are good. your money is better invested in gold - or even the SET

whats the SET

[pinball]

Hello to you all,

I strongly recommend the Islamic Bank of Thailand, good interest rates on savings accounts impeccable service too check it out!!!!!

[Beetlejuice]

Wow, this is fantastic news.

Now I can buy a new car and book up my world cruise.

[pinball]

I should also mention they are very happy to take us farang customers, branches are a bit limited right now, also no ATM withdrawal fees from which ever bank you use your ATM card Big +.

Don't need a work permit to open the account too, farang friendly.

Again excellent service.

Pinball

[pinball]

For those who maybe interested here is there website.

http://www.ibank.co.th/2010/th/main/

Pinball

[jombom]

Hello to you all,

I strongly recommend the Islamic Bank of Thailand, good interest rates on savings accounts impeccable service too check it out!!!!!

Strange --- they don't seem to be listed by BOT for banks with licenses to operate in Thailand. Link below

http://www.bot.or.th/english/statistics/financialmarkets/interestrate/_layouts/application/interest_rate/IN_Rate.aspx

But the truth is often stranger than fiction.

[Puccini]

Hello to you all,

I strongly recommend the Islamic Bank of Thailand, good interest rates on savings accounts impeccable service too check it out!!!!!

I thought Islamic banks weren't allowed to pay interest.

[yoshiwara]

its funny that the banks still think sub 2% rates are good. your money is better invested in gold - or even the SET

whats the SET

Stock Exchange of Thailand.

[kutjebu]

I find that Thai financial institutions have a lot to learn from the Americans.......Yes printing more money.

I find that Thai financial institutions have a lot to learn from the Americans and particularly the Chinese. Inflation is already hitting from what I hear from my partner (she said the price of food is going up) - expect price rises on other things such as that BTS fare to go up. The last thing to go up will be salaries.

China is rapidly increasing its' interest rates to curb inflation, and Thailand is gradually increasing. This is not to help the consumers out, but rather to stop inflation - the side effect will be profit downgrades on businesses nationwide - meaning foreigners will withdraw investments in Thailand, which have higher risk and lower risk return.

This may have some effect on the Thai condominium market, which is a bubble waiting to burst from my studies.- price affordability and rental returns vs. purchase price ratios are way off in this market.

[kutjebu]

Then your thinking is wrong.

Hello to you all,

I strongly recommend the Islamic Bank of Thailand, good interest rates on savings accounts impeccable service too check it out!!!!!

I thought Islamic banks weren't allowed to pay interest.

[Puccini]

Then your thinking is wrong.

It looks like I have misinterpreted the tenets of Islamic banking and the real story seems to be that fixed interest is not allowed, meaning that any other type of interest is allowed. Is that how it works?

www.islamic-banking.com/prohibition_of_interest.aspx

But this sounds more like profit participation, ie dividends, rather than interest, variable interest, in the real sense of the word "interest".

Edited May 16, 2011 by Puccini