Creditors and depositors at 42 financial companies to be closed by the Thai government will be protected, Thai financial authorities promised Japanese bankers Aug. 12.
The promise was made during an hourlong meeting attended by Thai Finance Minister Thanong Bidaya, Bank of Thailand Gov. Chayawat Wilbolsawaski and representatives of 21 Japanese banks with offices in Thailand.
Following the Tokyo meeting, Thanong told a new conference that he made no request for new funds from the Japanese banks. He said Thai officials discussed only the details of a $16 billion financial aid package agreed to Aug. 11 during a Tokyo meeting led by the International Monetary Fund.
Gov. Chayawat told the bankers that the principal put up by creditors and depositors at the 42 firms will be protected, a representative of the Long-Term Credit Bank of Japan said after the meeting.
Japanese financiers are concerned about loans from Japanese banks to these Thai firms, most of which are burdened by souring property-related loans.
The IMF attached a condition that the 42 financial firms be closed before agreeing to extend emergency credit to support the baht and boost the battered economy.