The Bank of Thailand (BOT) decided to relax the dividend payment policy for 2021 by unwinding the dividend payout ratio limit (not exceeding the past payout rate). Financial institutions have been allowed to pay dividends for 2021 not exceeding 50% of the net profit of 2021. However, financial institutions still need to strengthen their capital levels to support a continuation of credit expansion during the beginning of economic recovery. BOT also published guidelines on long-term debt refinancing and debt consolidation measures to help debtors affected by the COVID-19 pandemic.
As part of these debt measures, BOT requires financial institutions and business operators to not charge prepayment fees for personal loans under supervision and retail loans temporarily until December 31, 2023. BOT also revised debt consolidation guidelines for retail debtors by expanding the scope to enable debt consolidation across financial institutions and/or other business operators. Finally, BOT issued fair credit management guidelines to provide support to debtors facing difficulties amid COVID-19 pandemic as well as to support financial services users to be aware of their rights. The guidelines cover the end-to-end process of credit, including development and offering of credit products, credit risk management, debt collection, provision of assistance to debtors with loan repayment issues, litigation process, and sale and transfer of debt to other creditors.
Related Links (in Thai)
- Press Release on Dividend Payment Policy (in English)
- Notification on Dividend Payment Policy
- Circular on Dividend Payment Policy (PDF)
- Press Release on Debt Refinancing and Consolidation Measures
- Notification on Guidelines on Debt Refinancing and Consolidation
- Guidelines on Debt Refinancing and Consolidation (PDF)
- Press Release on Credit Management Guidelines
- Notification on Credit Management Guidelines
- Credit Management Guidelines (PDF)
Keywords: Asia Pacific, Thailand, Banking, COVID-19, Regulatory Capital, Credit Risk, Dividend Distribution, Loan Repayment, Guidelines, NPLs, BOT
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