KBANK and SCB shares drop on bankruptcy rumor

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But BOT says commercial banks remain strong

From Thai Enquirer

The share prices of Kasikorn Bank and Siam Commercial Bank drop slightly on Monday morning due to rumors of the possible collapse of commercial banks in Thailand.

During the weekend, Rangsan Thanapornpan, a Thammasat academic, said in an interview with WAYMAGAZINE that there were three large Thai commercial banks about to face bankruptcy.

However, Ronadol Numnonda, the deputy governor of Financial Institutions Stability, responded immediately by assuring that the financial situation and the capital fund of all commercial banks still remain strong and could handle the hardship during the COVID-19 economic crisis.

From the beginning of 2020 till the end of June, the BIS ratio of the commercial banks stood at a high level of 19.2 per cent and the performance is still profitable. Ronadol also mentioned that liquidity in the financial system was also prominent.

According to the BOT, the stress test has shown that the country’s financial sector was still resilient and could withstand more shocks if the situation does not improve.

BOT stated that assistance measures have mitigated the COVID-19 impact on businesses and many people can still pay off their debt normally.

Analysts in the banking sector said the commercial bank stock market hasn’t been that affected by the rumor that NPLs will cause the banks to break down.

“The fluctuation in price still seemed normal as the number is not significantly suggesting a loss in confidence in the stock market.”

Shares of Kasikorn Bank PCL (KBANK) were at 83.75 baht per share as the Monday morning session ended, decreasing by 1.75 baht or -2.05 per cent with the transaction value of 1,550 million baht. The lowest point reached was 82.75 baht.

While the Siam Commercial Bank (SCB)’s shares stood at 70.00 baht per share, the price decreased 1.00 baht or -1.41 per cent with the transaction value of 459 million baht. The lowest price was 69.25 baht.

SCB previously admitted that it was suspending all e-commerce transactions for all the debit cardholders of the bank claiming that the system was hacked.