A mortgage applicant asks a question at GH Bank's One Million Houses project. The bank met with the Finance Ministry and the Bank of Thailand to propose alternative measures for the LTV limits. (Photo by Somchai Poomlard) GH Bank is set to miss its loan growth target by 30% this year, restrained by the Bank of Thailand's new loan-to-value (LTV) policy, says president Chatchai Sirilai.That shortfall would be 60 billion baht short of the bank's full-year loan target of 203 billion, said Mr Chatchai. In 2019, GH Bank's loan target was determined from an average of mortgages during the past three years, he said. Last week, GH Bank and the Government Savings Bank consulted with the Finance Ministry and the central bank for resolutions on the LTV measure's impact. Loan growth for the two state-owned financial institutions will miss their targets this year if the loan criteria of both banks remains constrained by such measures, said Mr Chatchai. Starting on April 1, homebuyers were … [Read more...] about GH Bank falling 30% short of loan target
Central bank net banking
Major Philippine banks are still hoping that a cut in reserve requirement ratios, currently at 18 percent, will be decided keeping with the current condition of local and global financial markets. In March and June last year, the Bangko Sentral ng Pilipinas (BSP) allowed banks to bring down reserve ratios twice, from 20 percent to the current 18 percent by 100 basis points each, to free up about P200 billion for increased lending and bank investments. It was supposed to start a gradual easing in recognition of a slowdown in the entry of foreign investment funds to the country and the recovery of the US market and other major world economies. However, an escalation of inflation resulting from manipulated rice and food shortages in the local economy, with commodity prices rising by an average of 4.3 percent in the first half of 2018, led the BSP to temporarily hold back further reserve ratio reductions. Instead, the BSP continued with increasing its interest rates throughout the year in … [Read more...] about Time to bring down bank reserve ratios?
PETALING JAYA: While the banking sector generally experiences net interest margin (NIM) pressure from an interest rate cut as deposits take longer to reprice than loans, the net impact is relatively modest over the medium to long term, according to Mac-quarie Research. Research head Anand Pathmakanthan said, for example, as guided by CIMB Group Holdings Bhd, the full-year NIM impact is a 2-3 basis points (bps) decline. “Banks with low current and savings accounts or casa (repricing fixed deposits will reduce funding costs) and higher share of fixed-rate lending will be least impacted, like AMMB Holdings Bhd; on the flip side, banks with high casa and high share of floating rate loans, with minimal ex-commercial banking operations to mitigate, would be most impacted, such as Alliance Bank Malaysia Bhd,” he said. Today, most financial counters on Bursa Malaysia were in the red following Bank Negara Malaysia (BNM)’s decision to cut the Overnight Policy Rate (OPR) by 25 … [Read more...] about OPR cut to have minimal impact on banks but ringgit may weaken
THE World Bank has successfully promoted its “Maximising Finance for Development” (MFD) strategy by embracing the UN Sustainable Development Goals, internationally endorsed in September 2015. It has also secured support from the G20 and effectively pre-empted alternative approaches at the third UN Financing for Development summit in Addis Ababa in mid-2015. As the main “show in town”, developing countries will need to address the MFD’s implications by responding pro-actively and collectively to address the new challenges it poses. New macro-financial challenges As the MFD agenda privileges foreign investors and portfolio inflows, multilateral development banks (MDBs) should be obliged to clearly show how developing countries will benefit. Greater vulnerability and other adverse implications of being more closely integrated into fickle global financial markets, which detract from the ostensible advantages of such integration, are now widely acknowledged. … [Read more...] about Coping with World Bank financialisation
COPENHAGEN: Danske Bank lowered its outlook for 2019 after a disappointing first quarter, due in part to the effects of a massive money laundering scandal at its Estonian branch that has sent ripples across the Nordic banking sector.Denmark's biggest lender is trying to restore trust among investors and clients after it said last year that it had channeled 200 billion euros (US$223 billion) of suspicious payments through its Estonian branch between 2007 and 2015.On Tuesday it said the considerable investments it is making in compliance to repair its image had pushed up costs, while higher funding costs also weighed on its first quarter performance. That heaped further pressure on its share price, which slid more than 8 percent in morning trade."The Estonia case continues to require considerable management attention, including the ongoing investigations and our efforts to restore trust in us," interim Chief Executive Jesper Nielsen said in a statement.Investors are still waiting to find … [Read more...] about Danske Bank cuts outlook as money laundering scandal weighs