BAM eyes B10bn loan buy
Bangkok Commercial Asset Management Plc (BAM) is seeking to buy non-performing loans (NPLs) worth 10 billion baht this year, with a focus on retail, and small and medium-sized enterprise (SME) sectors.
The country’s largest bad loan management firm, a wholly-owned subsidiary of the Bank of Thailand’s Financial Institutions Development Fund, is in talks with four financial institutions on asset purchases. Most of the target loans are from retail and SME businesses, in line with rising distressed loans of the segments, senior executive vice-president Choopong Phokasawad said.
BAM’s full-year target is reachable after having bought both NPLs and non-performing assets worth 5 billion baht in the first half of the year, he said.
Currently, the total NPLs under the company’s management amount to 437.08 billion baht comprising 67,245 debtors.
Of the retail bad loans under BAM’s management, 30% are mortgages.
The retail bad loan purchases meet with government wishes for BAM to help bring down distressed loans amid swelling household debt and rising retail NPLs. Moreover, selling NPLs is a method to help banks reduce NPLs to a satisfactory level.
Last year BAM bought bad loans worth 12 billion baht, exceeding 10 billion typically purchased each year.
The company aims for a similar net profit of 4.9 billion baht achieved last year.
BAM yesterday launched a special mortgage package, targeting those who want to repossess their foreclosed homes. The company is offering a hair-cut of 20% of debt collateral value.
The package provides up to a 10-year loan and BAM will charge borrowers a minimum lending rate, which now stands at 6.25% until maturity.
The mortgage package, available until Dec 29, is being offered to customers seeking a loan of no more than 5 million baht.