BOT Issues Updates on Debt Restructuring and Dividend Payment Policy
BOT published guidelines for debt restructuring to assist business debtors affected by the COVID-19 pandemic. Financial institutions can consider delaying the repayment period based on the debt repayment ability of each debtor. Financial institutions can also consider maintaining the same classification during the deferral of debt repayment, depending on the status of the debtor before availing this measure (no later than December 31, 2021). Financial institutions must also not regard the delay in repayment as a cause for breach of the terms of repayment under the contract.
With respect to its dividend payment policy, BOT has allowed financial institutions to pay an interim dividend not exceeding the dividend payout ratio of last year and of no more than 50% of the first-half net profits of 2021. Financial institutions are still prohibited from buying back their shares and from redeeming or repurchasing financial instruments included in Tier 1 or Tier 2 capital before maturity. To determine the dividend payment policy for 2021, BOT will assess the pandemic situation and the economic recovery trends and will follow up on the progress of financial institutions' debt assistance.
Related Links (in Thai)
- Notification on Guidelines on Debt Restructuring
- Guidelines (PDF)
- Notification on Dividend Payment Policy
- Circular on Dividend Payment Policy (PDF)
Keywords: Asia Pacific, Thailand, Banking, COVID-19, Regulatory Capital, Debt Restructuring, Loan Repayment, Credit Risk, Basel, BOT
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Victor Calanog, Ph.D.
Leading economist; commercial real estate; performance forecasting, econometric infrastructure; data modeling; credit risk modeling; portfolio assessment; custom commercial real estate analysis; thought leader.
Previous Article
OSFI Outlines Expectations on LIBOR TransitionRelated Articles
PRA and FPC Finalize Changes to Leverage Ratio Framework in UK
The Prudential Regulation Authority (PRA) published the final policy statement PS21/21 on the leverage ratio framework in the UK. PS21/21, which sets out the final policy of both the Financial Policy Committee (FPC) and PRA
CFPB Proposes Rule on Small Business Lending Data Collection
The Consumer Financial Protection Bureau (CFPB) proposed to amend Regulation B to implement changes to the Equal Credit Opportunity Act (ECOA) under Section 1071 of the Dodd-Frank Act.
PRA Decides to Maintain O-SII Buffers for Another Year
The Prudential Regulation Authority (PRA) decided to maintain, at the 2019 levels, the buffer rates for the Other Systemically Important Institutions (O-SII) for another year, with no new rates to be set until December 2023.
FSB Report Assesses Implementation of Recommendations on Stablecoins
The Financial Stability Board (FSB) published a progress report on implementation of its high-level recommendations for the regulation, supervision, and oversight of global stablecoin arrangements.
APRA Updates Loan Serviceability Expectations for Home Lending
In a letter to the authorized deposit taking institutions, the Australian Prudential Regulation Authority (APRA) announced an increase in the minimum interest rate buffer it expects banks to use when assessing the serviceability of home loan applications.
CPMI and IOSCO Consult on Guidance on Stablecoin Arrangements
The Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) are consulting on the preliminary guidance that clarifies that stablecoin arrangements should observe international standards for payment, clearing, and settlement systems.
EBA and EIOPA Set Out Work Priorities for 2022
The European Banking Authority (EBA) and the European Insurance and Occupational Pensions Authority (EIOPA) have set out their respective work priorities for 2022.
MFSA Issues Reporting Updates and Guidance for Banks
The Malta Financial Services Authority (MFSA) updated the guidelines on supervisory reporting requirements under the reporting framework 3.0, in addition to the reporting module on leverage under the common reporting (COREP) framework.
EC Publishes Decision on List of Equivalent Third Countries Under CRR
The European Commission (EC) published the Implementing Decision 2021/1753 on the equivalence of supervisory and regulatory requirements of certain third countries and territories for the purposes of the treatment of exposures, in accordance with the Capital Requirements Regulation or CRR (575/2013).
EC Rule on Contractual Recognition of Write-Down and Conversion Powers
EC published the Implementing Regulation 2021/1751, which lays down implementing technical standards on uniform formats and templates for notification of determination of the impracticability of including contractual recognition of write-down and conversion powers.
