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Household debt hit Bt13 trillion by end of 2019

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19 minutes ago, snoop1130 said:

It noted that the Bank of Thailand is formulating measures to control household debt, such as setting a debt service ratio to gear loan amounts to the applicant’s earnings, urging financial institutes to adopt more responsible loan criteria, and promoting financial literacy to help the public budget more wisely.

Ban Neg-am mortgages for a start.

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The problem is numerical. As GDP slows it decreases but the volume of loans remain static, the ratio however will be much higher. So if at the end of the year GDP has fallen to USD 400 bill., consumer lending as a percentage of GDP will be in the 90's. NPL's are still quite low at under 3%, that's the important figure to watch, as long as people keep paying there's not a problem.

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Just now, PatOngo said:

The problem is they borrow more to keep paying!

The banks can be quite accommodating if people can't pay. BIL bought a house, against all the best advice, and one year later he can't afford the payments. The bank put him on a different repayment schedule which effectively cut his payments in half. His credit is out the window but he has his house and the bank has its loan.

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20 minutes ago, saengd said:

The banks can be quite accommodating if people can't pay. BIL bought a house, against all the best advice, and one year later he can't afford the payments. The bank put him on a different repayment schedule which effectively cut his payments in half. His credit is out the window but he has his house and the bank has its loan.

Up until a point.

 

And that point is going to arrive very soon for a lot of Thais.

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26 minutes ago, saengd said:

The banks can be quite accommodating if people can't pay. BIL bought a house, against all the best advice, and one year later he can't afford the payments. The bank put him on a different repayment schedule which effectively cut his payments in half. His credit is out the window but he has his house and the bank has its loan.

Yea, everything is fine. Borrow more. Keep borrowing. Dig your way out our financial despair. Just remember to dig up. 

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So what? It is hh debt not National Debt. ND is I believe at 45% of GDP. Very healthy indeed so stop the scaremongering. US’s is at 100% and Japan’s at 200%. Just ask yourself the question: if you were making say 1mln (your personal GDP) each and every year, would you be worried if the bank lent you 1mln? Of course not. People are blinded by the sheer figures. Ooh the US is 20 trillion in debt, conveniently forgetting that the US’s GDP IS also 20 trillion iow the US earns 20 trillion each and every year (and growing). So TV stop wingeing about Somchai’s debt levels. They are his and only his problem

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57 minutes ago, saengd said:

The banks can be quite accommodating if people can't pay.

 

I would not be as optimistic as you;
when a debtor can no longer afford to repay his debt (s), it is the bank (s) who find themselves in <deleted> with a house or a car or a truck on their arms;

Take a look at the banks of Thailand; you will see a huge catalog of goods seized because the buyer had eyes bigger than his stomach.
And since nobody can afford to buy these second-hand houses, cars, trucks, so the banks are left with wrecks that cannot be bought; and they are going to be the ones who will have to pay the broken pots.

 

You cannot grasp what does not exist.

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The famous Thai middle class at full swing.

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46 minutes ago, Nobbie49 said:

So what? It is hh debt not National Debt. ND is I believe at 45% of GDP. Very healthy indeed so stop the scaremongering. US’s is at 100% and Japan’s at 200%. Just ask yourself the question: if you were making say 1mln (your personal GDP) each and every year, would you be worried if the bank lent you 1mln? Of course not. People are blinded by the sheer figures. Ooh the US is 20 trillion in debt, conveniently forgetting that the US’s GDP IS also 20 trillion iow the US earns 20 trillion each and every year (and growing). So TV stop wingeing about Somchai’s debt levels. They are his and only his problem

Even better than that, 42% of that is debt owed in THB, borrowed from within Thailand, only about 3% is overseas debt.

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The sky is falling they are losing there jobs full up to there eyeballs in debt but the bhat keeps on keeping on even with the virus it hangs in there.

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48 minutes ago, Assurancetourix said:

 

I would not be as optimistic as you;
when a debtor can no longer afford to repay his debt (s), it is the bank (s) who find themselves in <deleted> with a house or a car or a truck on their arms;

Take a look at the banks of Thailand; you will see a huge catalog of goods seized because the buyer had eyes bigger than his stomach.
And since nobody can afford to buy these second-hand houses, cars, trucks, so the banks are left with wrecks that cannot be bought; and they are going to be the ones who will have to pay the broken pots.

 

You cannot grasp what does not exist.

Except the balance sheets of Thai banks are in excellent shape, Moody's and Fitch even upgraded them all recently, I wouldn't be too worried that they might suffer from distressed sales, especially since Non-Performing Loans remains so low at under 3%.

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