Sommai hints at an outsider taking the top post of BOT

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Sommai hints at an outsider taking the top post of BOT
ERICH PARPART
THE NATION

BANGKOK: -- FINANCE MINISTER Sommai Phasee said a decision to pick between two outsiders to lead the Bank of Thailand was "not going to be a problem" and added that MR Pridiyathorn Devakula, the deputy prime minister in charge of economic affairs, had given his approval for both candidates.

However, he did not explicitly state whether the two remaining names were both outsiders, although he did not deny it.

"The age of the internal candidates is under consideration and they might not be on the list, as you may have known already," he said in reply to a question about whether the candidates are both outsiders.

"I believe that there should be no internal issue within the BOT regarding the prospect of an outsider running the central bank, as they are well mannered. There might be some issues but I hope not a lot," he said.

"The new governor requires many qualities besides a lot of experience, while personality and cleverness are also definite attributes. People with less experience but the ability to adapt quickly can still be a candidate but what is of equal importance is the ability to handle the political situation in the next period. We have to look for such attributes in the background of the candidate," he said.

He explained that there was a law in place to prevent political influence on the job but "it is also up to the person" on how he or she will handle things.

"It would be even better if they can adapt themselves to the new work environment. If they adapt well, they could perform even better than Prasarn Trairatvorakul," the current governor, he said.

Of the five applicants, three are outsiders - Veerathai Santiprabhob, a former stock-exchange executive; Supavud Saicheua, managing director of Phatra Securities; and Kiatchai Sophastienphong, a former central bank official.

Sommai is fully empowered to pick one of them as BOT governor.

Meanwhile, the BOT yesterday released a statement on the result of a meeting between the central bank's Monetary Policy Committee and the Financial Institutions Policy Committee. It said risks to Thailand's economic and financial stability would heighten because of the country's slow economic recovery, affecting the private sector's ability to repay debts and prompting more impairment of commercial banks' credit quality.

However, such risks have not reached a systemic level. This is because commercial banks have a strong financial status on the back of robust capital bases and high loan-loss provisions, and businesses - particularly large ones - have had sound financial statuses, the release said. Such situations allowed them to cope with higher economic risks at a certain level in the next periods.

Risks in the search for higher yields in the financial system are limited, the release said, adding that new risks in the low-interest-rate situation would need monitoring. The volatility of Thailand money market as a result of the fragile global economy remained limited.

Thailand's economic slowdown needs to be monitored further, given its likely impacts on the private sector's financial status, and its ability to make adjustments and repay its debts.

This could affect the economic recovery in the next periods. More money-market volatility may come from global uncertainties and interest rate hikes in the United States.

Source: http://www.nationmultimedia.com/business/Sommai-hints-at-an-outsider-taking-the-top-post-of-30262848.html


-- The Nation 2015-06-23