New savings bonds won’t affect liquidity, says BoT

By k on June 29, 2009

BANGKOK, June 27 (TNA) – The government’s plan to issue its first batch of savings bonds – an issue valued at Bt 50 billion — will neither fuel rising interest rates nor affect the liquidity in the system very much, according to the Bank of Thailand (BoT).

BoT Deputy Governor Atchana Waiquamdee said the issuance of the government savings bonds would result in financial institutions adjusting for improved services because depositors have more channels for savings.

She said the first batch of Bt50 billion baht in such bonds represents 0.5 per cent of current total deposits of Bt9.6 trillion.

The bonds will offer an interest rate of 3 per cent in the first two years, 4 per cent in the third year, and 5 per cent in the fourth and fifth years, unlike deposit rates offered by commercial banks, which remain at 1.5-2.75 per cent.

Under the circumstances, some depositors might shift some of their deposits to the new government saving bonds.

“The BoT must monitor the liquidity following the issuance of the bonds by the Ministry of Finance so that it can be used to establish the policy interest rate in a proper manner,” she said. (TNA)

2nd lot of Strong Thailand bonds to be sold next year BANGKOK, 23 October 2009 (NNT) – The Ministry of Finance...
Banks to maintain interest rate till year end BANGKOK, 26 August 2009 (NNT) – Banks will not increase...
Finance to issue saving bonds worth THB 50 – 80 bn by the end of Q3 BANGKOK, 11 January 2010 (NNT) – The Finance Ministry is...
Siam Commercial Bank to issue bills of exchange to help boost the economy BANGKOK, 3 June 2010 (NNT) —The Siam Commercial Bank (SCB)...

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