MoF to offer incentives for bank mergers

BANGKOK, Dec 16 (TNA) -- Finance Minister Apisak Tantivorawong has announced that the Minstry of Finance is looking at promoting mergers among local banks to boost their survivability with the introduction of tax incentives to help reduce overheads. Mr Apisak confirmed that the ministry has plans to strengthen local banks in light of the increasingly volatile global financial environment. The modern digital age has given birth to a lowered dependency on regular monetary services and if they are to survive, local banks must adapt to this new reality. Mr Apisak stated that the MoF want to see increased mergers among local banks thereby providing them the needed strength and competitiveness to challenge foreign banks. He also revealed that he has approached the Bank of Thailand with the idea and has been given their support. Under the plan the MoF will be introducing tax incentives that will not only directly help with the mergers investment capital but will also make mergers a most attractive proposition for local banks. These incentives will be granted only to local banks. Mr Ahisak gave reassurances that the ministry was not putting pressure on banks to merge but desires to see local financial institutions grow in strength because on the whole, Thai banks are small compared to foreign banks. Local banks cannot persist with focusing on getting a piece of the local 'financial cake' but must move into global markets and champion Thailand's financial interests. Mr Aphisak went on to say that at present local private companies have far outgrown national banks with widespread commercial interests abroad acquired with loans secured from international banks. Thai banks must move to improve their standing as quickly as possible if they want to see the the situation reversed and attract business from these growing multinationals. (TNA)