GH Bank sees January spike in mortgage loans

GH Bank’s mortgage lending has shot up since January to 12 billion baht, attributed to more loan applicants being rejected by commercial banks and shifting to the state-owned bank, its chief says.

The bank typically lends 7-8 billion baht in January, but it managed to extend 12 billion last month, steady from the same period last year when homebuyers rushed to seek home loans ahead of implementation of the loan-tovalue regulation in April 2019, GH Bank president Chatchai Sirilai said.

For the first 14 days of February, the bank already loaned 6.2 billion baht.

GH Bank’s new loan target of 209 billion baht this year is likely achievable, given loan extensions early this year, extremely low interest rates and the state policy to support people owning their own homes, he said.

Even though the Covid-19 outbreak and subdued export growth have dealt a blow to economic growth this year, the bank’s customers, most of them salaried employees who borrow an average of 2 million baht, will be shielded from the country’s economic slowdown, said Mr Chatchai.

The low interest rate in the local market will be favourable to mortgage borrowers, he said.

The central bank’s Monetary Policy Committee is expected to make one more rate cut this year and home loan borrowers will exploit the low interest environment, which is expected to last for some time, said Mr Chatchai.

Paying higher than the minimum

‘‘ The bank aims to reduce non-performing loans to 3.8% at the end of this year from 4.05% now.

CHATCHAI SIRILAI

President, GH Bank

due on mortgages is recommended for those who have the ability to do so, he said.

The rate setters earlier this month cut the policy rate by 25 basis points to a record low of 1%, with the aim of lessening financial burdens for debtors, in particular retail and small and medium-sized enterprises.

Mr Chatchai said GH Bank aims to reduce its non-performing loans to 3.8% at the end of this year from 4.05% now.

To facilitate borrowers, the bank has improved its loan scrutiny process, requiring them to visit the bank on signing contract dates only by sending messengers to pick up the documents.