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Thailand Financial Institutions
Thailand had many types of financial institutions, subject to
different laws and regulated by different agencies. Most of them
were privately owned, but some were state owned. The primary
state-owned facility was the Bank of Thailand, which had
responsibility and authority for monetary control in its role as
the central bank. It served as the fiscal agent and the financier
of the government; regulated the money supply, foreign exchange,
and the banking system; and also served as the lender of last
resort to the banks. Other state-owned facilities included the
Government Savings Bank, the Bank for Agriculture and
Agricultural Cooperatives, the Industrial Finance Corporation of
Thailand, the Government Housing Bank, and the Small Industry
Finance Corporation of Thailand.
By the mid-1980s, the 30 commercial banks had 1,526 branches
handling the majority of all financial transactions in Thailand.
The 16 largest banks accounted for over 90 percent of assets,
deposits, and loans of the commercial banks, indicating a high
concentration and little competition in the banking industry.
Moreover, despite the impressive growth of banks, entrance by new
banks was limited.
Finance and security companies comprised the second largest
group of financial institutions with assets equaling nearly 22
percent of those of commercial banks. Concentration also existed
in the securities industry, the 5 largest companies (out of 112)
holding 19 percent of all finance and security assets. The
finance companies were created by many domestic and foreign banks
to overcome banking restrictions. Although they were intended to
increase competition with commercial banks, the objective was not
met because many banks used the companies as an extension of
their own activities.
Data as of September 1987
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