Loans forecasted to increase in third quarter

The expected business loan increase also stemmed from an implementation of the government policy to encourage state financial institutions and specialized financial institutions to extend loans into the system in order to help with the economic recovery.

Sources report that financial loans in the second quarter of this year were stagnant because lenders remained strict in their lending approvals to the business and consumer sectors.

The slowdown in loan approvals was because there were many risky factors such as the unstable political situation and the viral A (H1N1) outbreaks. These two major factors directly and severely affected all parts of businesses’ perspectives in Thailand and on the whole globe.

Therefore, after these two business constraints appeared to be less of a concern, BoT management recently forecasted that all major financial institutions would compete fiercely in lending and issuing debt instruments in the third quarter because the government has issued many business stimulus campaigns.

Apart from this, household loans were also forecasted to rise slightly in the third quarter as interest  Rates appear to be staying low while the demand for credit loans this year is anticipated to decline.