BANGKOK, 17 May 2014 – The political situation weighed on the economy and resulted in a slowdown in banks’ lending in the first quarter of the year, according to the Bank of Thailand.
Anupap Kuvinichkul, senior director of the BOT’s Financial Institutions Strategy Department, disclosed that lending by commercial banks expanded 9.8% in the first quarter. This was less than the 11% expansion during the same period of the previous year. Business loans grew 9.4%, whereas lending to SMEs expanded 11.7%. This was the first quarter of reduced growth, after a period of continued expansion over the last 2-3 years.
Consumer loans grew 10.7%, which was a lower than the 12.9% growth experienced in the fourth quarter of last year. At the same time, the quality of loans was trending lower – non-performing loans have increased to 279.8 billion baht, or 2.3%.
Mr. Anupap, however, indicated the 9.8% expansion of bank loans still exceeded the country’s GDP expansion, and should not prove to be an obstacle toward the recovery of the economy.
