The Ministry of Finance and the Bank of Thailand are considering amending AMC regulations to reduce household debt and stimulate lending.

The Ministry of Finance and the Bank of Thailand are considering amending regulations to allow banks to establish their own AMCs and consolidate non-bank debt. This is aimed at reducing household debt and encouraging banks to increase lending. This is particularly true for banks that are not ready to use ARI-AMCs.

Aug 9, 2568 Mr. Lawan Saengsanit, Permanent Secretary of the Ministry of Finance It was revealed that the Ministry of Finance, through the Fiscal Policy Office (FPO), is in discussions with the Bank of Thailand (BOT) and the Thai Bankers' Association on approaches to addressing household debt and non-performing loans (NPLs) through the use of asset management companies (AMCs) to manage non-performing loans from financial institutions.

“The Ministry of Finance and the Bank of Thailand have been discussing this issue continuously. Now, there is a clear direction. We are currently amending some related regulations, including considering covering non-bank loans, which are not currently covered by the law.”

The AMC model to be developed will be one established by each bank, not a new national AMC. This approach was chosen because it will be faster than setting up a new agency.

"We won't establish a central AMC because it's slow. Establishing a new entity requires legal procedures and recruiting personnel, which could take more than a year. Instead, we'll establish an AMC for each financial institution. We've discussed this with the Thai Bankers' Association, and the response has been positive. Commercial banks have long expressed their desire to establish their own AMCs, but this hasn't been possible in the past due to BoT regulations. Now, the BoT has agreed."

For state-owned banks and small commercial banks and state-owned banks that are not comfortable setting up their own AMCs, there is the Government Savings Bank's ARI-AMC that can support these debts.

"For state banks, we need to see what regulatory obstacles they face. If they can make changes, we're ready to do so. Alternatively, if a bank isn't ready, they can use the Government Savings Bank's ARI-AMC."

Mr. Laworn revealed that the key reason for establishing an AMC is to reduce the current high level of household debt, enabling banks to better manage their balance sheets and thus reinstate lending, serving as a key mechanism for sustaining the economic system.

"The next step is to amend the regulations for each organization, loosening some criteria to facilitate faster implementation without the need for new legislation. This will allow for faster implementation. Commercial banks will also be encouraged to transfer NPLs to AMCs, which is currently not possible. We will expedite this process to the Cabinet for approval, as this is an important policy."

As for how much debt will be determined, Mr. Laworn said it is still under consideration, and he expects to see results as soon as possible.

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