Connect with us

Banking

Thai Central Bank will not revise loan-to-value (LTV) measures

The central bank has implemented the LTV regulation to deal with household debt and speculative activities, which have caused home prices to increase

National News Bureau of Thailand

Published

on

Real Estate promotion billboards in downtown Bangkok

BANGKOK, 30 May 2019 (NNT) – Following the implementation of the loan-to-value (LTV) regulation since April this year, mortgage lending has shown signs of slowing down.

However, the Bank of Thailand (BOT) reported that the slowdown is caused by the accelerated transactions since the end of last year.

The BOT Governor, Veerathai Santiprabhob, said the central bank will not revise the LTV measures at this time because the contraction of the mortgage market is caused by the accelerated transactions and ownership transfers since the fourth quarter of 2018. As a result, the mortgage lending figures for April and May were lower than projected. The BOT will observe the impact of these measures for a period of time before making further decisions.

The central bank has implemented the LTV regulation to deal with household debt and speculative activities, which have caused home prices to increase. The central bank insisted that this regulation will benefit first-time home buyers who look for affordable homes. The regulation will also help prevent an economic bubble from forming in the country’s property sector.

As for the BOT’s measures to supervise car loans, the central bank had a discussion with the Thai Bankers’ Association (TBA) to consider the criteria for auto loan approvals in connection with a buyer’s debt to income ratio. Previously, banks and financial institutions approved loans by focusing more on the products than the buyer’s income.

Source link

Advertisement
Comments

Most Viewed

Subscribe via Email

Enter your email address to subscribe and receive notifications of new posts by email.

Join 12,754 other subscribers

Latest

Trending