Bank deposit insurance reduction in 2016

[Pib]

I've always have divided over several bank accounts, because they told me many years ago already right after the banking crisis in Europe in 2008 at my local Krungsri, that the insurance is 1 M per account, not per bank.

If your money is spread over several accounts at the same bank it does "not" give you Bt1M per account (once it drops to Bt1M coverage in 2016); you get Bt1M per depositor (i.e., you) per bank. Let's say we are now in 2016 and the coverage has dropped to Bt1M. If you had Bt2M split evenly between two accounts at Krungsri either at one branch or multiple Krungsri branches, you are only covered for Bt1M total. It's Bt1M per depositor per bank.

You misunderstood what the Krungsri rep told you.

[Pib]

If you have more than a million in cash, you would be a fool to keep it in Thailand. There are no protections for your money in a bank here. Keep your nest egg in your own country. This will keep it safe and away from prying eyes. Bring it here and it will be gone.

Most retirees have the 800,000 baht on deposit for the retirement visa. Presumably there are a number who also have more than an extra 200,000 baht to rely on for living expenses each year. Drawing living expenses from your "own" country periodically is expensive in terms of fees, both here and at your "own" country. If you are a retiree and following your own advice, I'm wondering who the fool is.

It's not expensive at all if as long as your home country bank don't charge unreasonable "sending" fees or you allow your sending bank to convert to baht vs allowing the Thai bank to do the conversion. And generally the receiving fee on the Thai bank end is 0.25% (Bt200 min, Bt500 max).

It's your home country sending bank that is the key on how much a transfer costs a you. Sounds like your home country bank may be one of the fee-hungry banks with high sending fees---change banks.

[TallGuyJohninBKK]

I've always have divided over several bank accounts, because they told me many years ago already right after the banking crisis in Europe in 2008 at my local Krungsri, that the insurance is 1 M per account, not per bank.

If your money is spread over several accounts at the same bank it does "not" give you Bt1M per account (once it drops to Bt1M coverage in 2016); you get Bt1M per depositor (i.e., you) per bank. Let's say we are now in 2016 and the coverage has dropped to Bt1M. If you had Bt2M split evenly between two accounts at Krungsri either at one branch or multiple Krungsri branches, you are only covered for Bt1M total. It's Bt1M per depositor per bank.

You misunderstood what the Krungsri rep told you.

Either that, or equally likely, the Krungsri rep gave out incorrect information/advice.

It's not like a lot of the retail bank branch staff are whizzes when it comes to DPA coverage/regulations.

[bazza40]

If you have more than a million in cash, you would be a fool to keep it in Thailand. There are no protections for your money in a bank here. Keep your nest egg in your own country. This will keep it safe and away from prying eyes. Bring it here and it will be gone.

Most retirees have the 800,000 baht on deposit for the retirement visa. Presumably there are a number who also have more than an extra 200,000 baht to rely on for living expenses each year. Drawing living expenses from your "own" country periodically is expensive in terms of fees, both here and at your "own" country. If you are a retiree and following your own advice, I'm wondering who the fool is.

It's not expensive at all if as long as your home country bank don't charge unreasonable "sending" fees or you allow your sending bank to convert to baht vs allowing the Thai bank to do the conversion. And generally the receiving fee on the Thai bank end is 0.25% (Bt200 min, Bt500 max).

It's your home country sending bank that is the key on how much a transfer costs a you. Sounds like your home country bank may be one of the fee-hungry banks with high sending fees---change banks.

It's a flat fee of AUD 27.50 irrespective of whether the transfer is $200 or $20,000. Thai conversion rates are reasonable, I'm already aware Australian bank conversions are legalised theft. The other alternative is to use a debit card, in which case I pay $4 at the Australian end and 180 baht here on the maximum allowable withdrawal of 25,000 baht. Gets expensive after a while that way.

There's risk everywhere. I think the logical conclusion to draw from this thread is keep most of your money back in your own country, and split your accounts here between banks so that no one account is more than 1M baht.

Might be old-fashioned; however, I do love the Thai bank book system. When a thief needs the bank book, passport, signature in front of the teller and a face matching that in the passport to commit fraud, it's about as secure as you can get.

[fletchsmile]

If you have more than a million in cash, you would be a fool to keep it in Thailand. There are no protections for your money in a bank here. Keep your nest egg in your own country. This will keep it safe and away from prying eyes. Bring it here and it will be gone.

Once someone has understood some of the things that could happen in Thailand they should then apply this to where they keep their money globally.

In 2008 The UK, US and European banking systems were in dire straits and we'll probably never know just how close to collapsing their financial systems were. 2008 and working for a Thai bank being in daily senior management meetings on the GFC subject I was glad to have some money here in Thailand and felt safe knowing all my eggs weren't in western baskets. I was glad also all my money wasn't all in cash or all in equities or bonds or any other financial asset.

If as an expat someone sees this as a Thailand only issue or EM or developing country problem they really haven't grasped the wider issues. If you're living in Thailand it's an excellent opportunity to protect yourself against financial risks in US, Europe , UK etc. Particularly if your main expenditure is in THB.

Spreading your money across more than one country and more than one banking system is just an extension of this issue.

Edited October 27, 2015 by fletchsmile

[lopburi3]

If the larger countries banks fail so will the smaller - the fact is banks have failed here in the recent past but arrangements were made to cover them - as long as it is a limited issue (bad local management) insurance is useful - but in the worst case it would not likely make much difference. Those with gold in the hand are likely to be the survivors (if they can avoid those without).

Personally would prefer to live our short life rather than hunker down under tin foil maybe's.

[Orac]

It is also worth bearing in mind that Thai banks are fairly insular with far less exposure to the global derivative trade that did caused problems in the last crisis. The triggers likely to provoke a need for deposit protection with one of the larger Thai banks would probably affect all banks at the same time and result in runs across all banks which the DPA is just not capable of containing.

[Pib]

It's a flat fee of AUD 27.50 irrespective of whether the transfer is $200 or $20,000. Thai conversion rates are reasonable, I'm already aware Australian bank conversions are legalised theft. The other alternative is to use a debit card, in which case I pay $4 at the Australian end and 180 baht here on the maximum allowable withdrawal of 25,000 baht. Gets expensive after a while that way.

There's risk everywhere. I think the logical conclusion to draw from this thread is keep most of your money back in your own country, and split your accounts here between banks so that no one account is more than 1M baht.

Might be old-fashioned; however, I do love the Thai bank book system. When a thief needs the bank book, passport, signature in front of the teller and a face matching that in the passport to commit fraud, it's about as secure as you can get.

Using the card route can indeed work out well if you can get such cards in your home country. Fortunately for me, I can and have use such debit and credit cards since early 2011 to transfer all my money needs from the U.S. to Thailand. I have not needed to do a wire/SWIFT/ACH/etc., transfer since early 2011. When I did do transfers it was via the ACH system (i.e., the primary U.S. funds transfer system) to Bangkok Bank which only cost $5 plus 0.25% (Bt200 min, Bt500 max) for $2,000 USD or less.....and $10 plus 0.25% (Bt200 min, Bt500 max) for amounts over $2,000. All of those low fees were Bangkok Bank New York and in-Thailand Bangkok Bank fees; my particular U.S. home country sending banks do not charge a Sending fee. And I always send in USD...don't allow the Sending banks to convert to baht because banks outside of Thailand will give a significantly lower exchange rate than Thai banks.

I have several debit cards which are no foreign transaction fee cards with also reimburse local ATM fees like the Thai bank ATM Bt180 fee....no annual fee on these cards. And I even use credit cards (no annual fee) to do counter cash advances since the two credit cards I use do not charge a foreign transaction fee nor cash advance fee, I prepay the withdrawal to prevent any interest charge, and Thai banks don't charge any fee for a counter withdrawal...or at least the two banks I use, Bangkok Bank and Krungsri Bank, don't. And I get the full Visa exchange rate that is plus or minus a few stang of the Thai TT Buying Rate used for incoming transfers. A person can use a debit card also to do a counter withdrawal but some Thai bank branches will not accept a debit card for a counter withdrawal, instead they just point you to their ATM.

But I was "not" set up this well "bank or card-wise" when arriving Thailand in 2008 because all my debit/credit cards applied a foreign transaction fee...fine for U.S. domestic use but got pricey fee-wise using them outside the home country. And then I got tied of paying ACH transfer fees although low, I just didn't like paying them. So, I then opened some new bank and cards accounts over the 2011 to 2013 time frame and now I'm setting pretty good in terms of having bank and card accounts which allow me to get money into Thailand free of fees when using my cards and at a low cost if using ACH transfer.

Depending on a person's home country they will have different levels of success in being able to open fee-free or low cost bank and/or card accounts...every country is different. It does require a person to shop around and not be locked to just one bank/card company that they have been with for a long time and work fine domestically but may be expensive fee-wise for foreign use. I treat banks/cards like most any other product/service in that I shop around for the best deal and switch when smart to do. Cheers.

[Naam]

What are your plans to mitigate losses in case of bank failure?

1. Transfer funds back to home or other country
2. Transfer to multiple banks to keep each bank under 1M
3. Move to other instruments such as stock or bonds
4. Transfer to a government bank with guarantee of full amount of deposit
5. Move to a larger, more stable and solvent Thai bank
6. Keep it in a mattress, that is no banks
7. Does not effect me
8. No change
9. Change your fiat money into real money.

I go with option number 9.

Allan Greenspan: "Only gold is money. Everything else is credit"

I say: "Fiat (money) is fraud"

right you are! to buy steaks in Friendship, pay for a flight, dinner in a restaurant or purchasing a car and paying utility bills physical gold is required. fiat money is not acceptable.

silly comments like yours are either or

[bazza40]

I say: "Fiat (money) is fraud"

right you are! to buy steaks in Friendship, pay for a flight, dinner in a restaurant or purchasing a car and paying utility bills physical gold is required. fiat money is not acceptable.

silly comments like yours are either or

Think Khrab was making the point fiat money is a house of cards that could collapse at any time, so it's prudent to have part of your assets in something which won't evaporate. The reductio ad absurdum does not apply.

It's wonderful being part of Thai Visa, so many comments by judgmental pricks to enjoy.

[Naam]

I say: "Fiat (money) is fraud"

right you are! to buy steaks in Friendship, pay for a flight, dinner in a restaurant or purchasing a car and paying utility bills physical gold is required. fiat money is not acceptable.

silly comments like yours are either or

Think Khrab was making the point fiat money is a house of cards that could collapse at any time, so it's prudent to have part of your assets in something which won't evaporate. The reductio ad absurdum does not apply.

It's wonderful being part of Thai Visa, so many comments by judgmental pricks to enjoy.

i have heard ridiculous comments like "fiat money" and "house of cards" since Nixon abandoned the (anyway fake) gold standard. that was 44 years ago, i just finished university, had no money in the bank and my car was partly financed, i.e. at that time i had no reason to waste one thought on "crap" (pun not intended)

and if i had lived, saved and invested based on the mantra "fiat money is fraud" i'd be probably living somewhere elCheapo style in Thailand worrying about exchange rates, 150 Baht ATM fees, beer and noodle soup prices or most probably in my home country worrying when heating oil, gasoline or potato prices go up 5%.

[bazza40]

I say: "Fiat (money) is fraud"

right you are! to buy steaks in Friendship, pay for a flight, dinner in a restaurant or purchasing a car and paying utility bills physical gold is required. fiat money is not acceptable.

silly comments like yours are either or

Think Khrab was making the point fiat money is a house of cards that could collapse at any time, so it's prudent to have part of your assets in something which won't evaporate. The reductio ad absurdum does not apply.

It's wonderful being part of Thai Visa, so many comments by judgmental pricks to enjoy.

i have heard ridiculous comments like "fiat money" and "house of cards" since Nixon abandoned the (anyway fake) gold standard. that was 44 years ago, i just finished university, had no money in the bank and my car was partly financed, i.e. at that time i had no reason to waste one thought on "crap" (pun not intended)

and if i had lived, saved and invested based on the mantra "fiat money is fraud" i'd be probably living somewhere elCheapo style in Thailand worrying about exchange rates, 150 Baht ATM fees, beer and noodle soup prices or most probably in my home country worrying when heating oil, gasoline or potato prices go up 5%.

If you had lived, saved and invested based on the mantra "fiat money is fraud" you would probably be considerably wealthier than you are now.

[Naam]

If you have more than a million in cash, you would be a fool to keep it in Thailand. There are no protections for your money in a bank here. Keep your nest egg in your own country. This will keep it safe and away from prying eyes. Bring it here and it will be gone.

words of wisdom! i can confirm that nearly all the money i brought into Thailand during the last 42 years is gone. actually it's not really gone because it's in the pockets or accounts of other people.

[Naam]

If you had lived, saved and invested based on the mantra "fiat money is fraud" you would probably be considerably wealthier than you are now.

little do you know

[Naam]

If you had lived, saved and invested based on the mantra "fiat money is fraud" you would probably be considerably wealthier than you are now.

you are not probably but definitely wrong. but assuming you are right and i'd be considerably wealthier it wouldn't affect my present lifestyle but the future lifestyle of my heirs

[bazza40]

If you had lived, saved and invested based on the mantra "fiat money is fraud" you would probably be considerably wealthier than you are now.

you are not probably but definitely wrong. but assuming you are right and i'd be considerably wealthier it wouldn't affect my present lifestyle but the future lifestyle of my heirs

Perhaps I am projecting my Australian experiences onto yours. For myself, I know damn well I'd be a lot better off if I had steered clear of "investments", and simply bought gold and real estate outright. Not that I'm hurting now.

Getting back on topic, I am wondering what percentage of these rumoured changes e.g. Insurance reduction, doubling of retirement funds from 800k to 1.6M will actually turn out to be true. Methinks some may be test balloons or troll postings.

[Naam]

If you had lived, saved and invested based on the mantra "fiat money is fraud" you would probably be considerably wealthier than you are now.

you are not probably but definitely wrong. but assuming you are right and i'd be considerably wealthier it wouldn't affect my present lifestyle but the future lifestyle of my heirs

Perhaps I am projecting my Australian experiences onto yours. For myself, I know damn well I'd be a lot better off if I had steered clear of "investments", and simply bought gold and real estate outright. Not that I'm hurting now.

Getting back on topic, I am wondering what percentage of these rumoured changes e.g. Insurance reduction, doubling of retirement funds from 800k to 1.6M will actually turn out to be true. Methinks some may be test balloons or troll postings.

the only doubling of retirement funds applies to foreign married couples. partner "piggy-backing" like some years ago is not possible anymore.

[chiang mai]

Just an update:

The DPA (Bank Deposit Protection Scheme) has been extended, the amount of protection covered will be reduced in 5 million Baht tranches between now and 2020 when it will reduce to 1 million baht per account..

[Tywais]

4 more years added to it now.

http://www.thaivisa.com/forum/topic/913317-banks-agree-with-extension-of-deposit-protection/

[TallGuyJohninBKK]

I believe it's called, kicking the can down the road ... again.

But still, I'm glad they actually did it.

[fletchsmile]

I believe it's called, kicking the can down the road ... again.

But still, I'm glad they actually did it.

One of the benefits of globalisation and imports from western financial culture LOL

I posted almost the exact same words on another Thai forum.

Like ChiangMai for some time/ years I've expected them to either change the limit or delay the timeline again (and again). This time they've done both

Funny thing was I was reaching the stage where it looked to me like it actually had a reasonable chance of going thru this year as a reduction. Probably more than I've ever thought in the past, and banks were preparing for it. Then they go back to expected form Almost fooled us

Edited April 29, 2016 by fletchsmile

[TallGuyJohninBKK]

Kind of like everything else here. They publicly say one thing, and then turn around and do something entirely different. Kind of grow to expect that.

I too kind of figured at some point they'd likely back off of the reduction. But the government here is pretty unpredictable in some regards. So until that time actually came (as it in fact turned out to happen), I always advised folks to plan ahead for the lower limit -- until given a reason to do otherwise.

[macahoom]

 

What is the latest on this? 

 

Does anyone have any clear, definite information?

[Pib]

Visit the Thai govt Deposit Protection Program website for info:

http://www.dpa.or.th/ewt_news.php?nid=320&filename=index___EN

 

The changes as announced earlier are in effect, with the first effect occurring 11 Aug 16 when a person's account will still be insured up to Bt15M where under the previous program it would have dropped to Bt1M.