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
Leading economist; commercial real estate; performance forecasting, econometric infrastructure; data modeling; credit risk modeling; portfolio assessment; custom commercial real estate analysis; thought leader.
Previous ArticleOSFI Outlines Expectations on LIBOR Transition
The European Banking Authority (EBA) proposed implementing technical standards on the interest rate risk in the banking book (IRRBB) reporting requirements, with the comment period ending on May 02, 2023.
The U.S. Federal Reserve Board (FED) set out details of the pilot climate scenario analysis exercise to be conducted among the six largest U.S. bank holding companies.
The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.
The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.
The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.
The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.
The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.
The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.
The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.
The General Board of the European Systemic Risk Board (ESRB), at its December meeting, issued an updated risk assessment via the quarterly risk dashboard and held discussions on key policy priorities to address the systemic risks in the European Union.