Thailand Banking System Could Take Two More Years to Stabilize

It could take at least two more years for Thailand to stabilize its unsteady banking system according to a senior U.S. bank official.

Thai banks have reported one of the highest, non-performing loan rates at 47 percent in the region. However, this rate is expected to decrease below 30 percent during the next year as a result of write-offs and restructuring.

The devaluation of the baht currency in July 1997 and the economic crisis in Asia that followed were the contributing factors that led Thailand's banking system into its current state of weakness.

The economic situation is improving in the region thanks to corporate debt restructuring and the implementation of economic reforms proposed by the International Monetary Fund (IMF).


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