BAAC sees bad loans topping 5%
The state-owned Bank for Agriculture and Agricultural Cooperatives (BAAC) says its bad-loan ratio is likely to exceed the 5% target for this fiscal year because of softer prices for some crops.
The weak prices of some agricultural products, particularly rubber, have taken a toll on farmers’ debt-servicing ability, said president Apirom Sukprasert.
However, the bank’s non-performing loan (NPL) ratio will only slightly outpace the 5% target, thanks to the improving prices of rice and corn, he said.
The BAAC’s financial year runs from April 1 to March 31.
The bank wants its outstanding loans to increase by 93 billion baht for the next financial year, compared with 86 billion this year, Mr Apirom said.
New-loan growth is expected to reach 600 billion baht at the end of this month from 560 billion at present.
If new-loan growth achieves 600 billion baht, the bank’s outstanding loans will come in at 1.4 trillion baht by the end of this financial year.
The BAAC is also targeting new deposits of 58 billion baht for the next financial year, of which 15 billion will be deposited by farmers.
To encourage farmers to make deposits, the bank plans to launch lottery savings with higher rewards, Mr Apirom said.
The BAAC’s new deposits are expected to hit 78 billion baht at the end of this month, up from 67 billion at present.
In another development, Mr Apirom said the number of the government’s welfare and subsidy recipients who signed up for job training at the bank under the second phase of an aid scheme to alleviate poverty in return for an additional living allowance numbered 3.7 million.
There were 5.3 million low-income earners registered at the BAAC for the first phase of the scheme.
The second phase of the government’s welfare and subsidy scheme was aimed at addressing the root causes of poverty and required recipients to sign up for skills training programmes last month to obtain an additional living allowance of 100-200 baht a month to buy goods at Thong Fah Pracha Rat shops, on top of the 200-300 given in the first phase.
Finance Minister Apisak Tantivorawong said earlier this week that nearly half of the government’s welfare and subsidy scheme recipients who voluntarily signed up to participate in skills training programmes failed to do the training courses.