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GH Bank opens centre to avert NPLs

Bangkok Post Mar 12, 2009

Counselling and extensions are on tap

The Government Housing Bank (GH Bank) plans to set up a consulting centre next month for mortgage customers who might face payment problems to prevent possible non-performing loans (NPLs), said executive vice-president Jamaree Savetachinda.

She said mortgage loan customers can inform them of their problems via the bank's website, e-mail or fax. The centre will give them advice and seek solutions before they become NPLs.

A possible solution is an extension of the payment period to reduce monthly payments.

''We started applying these aids to welfare customers late last year as there were some companies notifying us that they decreased their employees' hours,'' she said.

She added the project would be considered by the board early next month before official implementation. It would help the bank reduce or delay NPLs.

GH Bank president Khan Prachuabmoh said that the bank would also launch special interest rates for homebuyers of units priced below 1 million baht by April as other commercial banks are beginning to refuse them.

''GH Bank is the main source of housing loans for lower-income earners,'' he said. Last year GH Bank's average credit line per customer was between 700,000 and 800,000 baht.

The residential market during the first two months of the year showed a creeping recovery from late last year. New housing loans released by GH Bank totalled 5 billion baht in January and rose to 6.3 billion baht in February.

Mr Khan said the bank targeted to release a total of 73.5 billion baht in 2009, down from 81 billion baht in 2008 with a target profit of 3.6 billion baht. To date the bank's liquidity was 60 billion baht or 11%.

GH Bank signed a contract yesterday with the Government Pension Fund (GPF) offering an interest rate of 3.99% for the first year, the minimum retail rate (MRR is currently at 6.75%) -2.25% for a second year and MRR-1.25% afterwards.

GPF members can apply for buying or building a new house, refinancing from other banks and buying furniture or housing fixtures with a credit line of up to 110% of the appraised price and up to 65 times monthly salary until end of this year.

Last year, 11,069 GPF members applied for mortgages under the scheme with a total credit line of 7.63 billion baht. In total, 192,000 GPF members have applied to the programme with combined credit of 126 billion baht.