KTB plays waiting game on Energy Earth
Audit due today, rehab plan not yet discussed
State-owned Krungthai Bank (KTB), Energy Earth Plc’s largest creditor, is waiting for the debtor’s special audit report on its sources of debt before making a decision on the cash-strapped coal trader’s business rehabilitation plan, its chief says.
The bank plans to consider Energy Earth’s special audit and it needs to hold talks later with the debtor concerning debt restructuring and a business rehabilitation plan, said KTB president Payong Srivanich.
KTB has set up a special team overseeing Energy Earth’s case and the team has been in talks with the client, he said. However, the bank has not officially talked with the customer about a business rehabilitation plan.
Energy Earth said last Friday it had come to terms with its main creditors on a debt resolution under the company’s business rehabilitation plan, a move that would allow it to resume operations. Energy Earth submitted a rehabilitation petition through the Central Bankruptcy Court on July 24 because it had liabilities in excess of assets as it recorded contingent liabilities worth 26 billion baht.
On Aug 9, the Securities and Exchange Commission ordered Energy Earth to arrange the special audit report regarding the sources, existence and status of additional debt, as the debt had reached 1.21 times the company’s financial position. The company is scheduled to submit the report today. Energy Earth owes 12 billion baht in principal and interest to KTB. Other bank creditors are Kasikornbank, Bank of Ayudhya and Export-Import Bank of Thailand.
Mr Payong said KTB’s loan-loss reserves for this quarter would return to normal after setting aside as much as 13 billion baht in the second quarter to fully cover Energy Earth’s debt.
In related news, KTB plans to adopt biometric payment technology to provide more convenience to its users. The bank has been developing biometric technologies covering fingerprint, retina, and facial scans.
It expected to seek the Bank of Thailand’s approval to test out such innovative technologies in the regulatory sandbox next month, said Praralee Ratanaprasartporn, senior executive vice-president and head of retail shared services group data innovation.
KTB yesterday introduced its quick response (QR) code payment at the Finance Ministry’s canteen and shopping areas under the central bank’s regulatory sandbox. The bank received approval from the central bank to test out QR code payment in five locations.
There are 3.5-4 million KTB mobile banking users with total deposit accounts of more than 10 million.
Finance Minister Apisak Tantivorawong believes QR code payment will gain popularity, given its convenience and security. Despite the advent of QR code payment, electronic data capture terminals are still necessary to serve debit cardholders who do not have smartphones, he said.