Thailand Banks Cut Lending Rates in Coordinated Economic Boost

GSB and TTB respond to policy rate cut, aiming to stimulate economic activity and ease financial burdens

 

In a concerted effort to stimulate Thailand's slowing economy, the Government Savings Bank (GSB) and TMBThanachart Bank (TTB) have announced significant reductions in their lending rates, following the Bank of Thailand's policy rate cut on February 26th.

 

GSB revealed on Tuesday a 0.25 percentage point reduction in key lending rates, effective from March 5th to August 31st, or until further notice. The bank will lower its Minimum Loan Rate (MLR) for corporate clients to 6.65% and its Minimum Overdraft Rate (MOR) to 6.495%.

 

GSB Director Vitai Ratanakorn stated that the move aligns with the Bank of Thailand’s Monetary Policy Committee’s decision to cut the policy rate to 2%, aiming to create financial conditions that support economic trends and foster growth. 

 


"This adjustment will help reduce financial costs for businesses and contribute to overall economic stimulation," Vitai said.
 
 

The bank will maintain its Minimum Retail Rate (MRR) at 6.595%, which remains lower than the average 7.25% offered by commercial banks. 

 

GSB is the fourth bank to cut rates, joining Siam Commercial Bank, Krungthai Bank and Kasikorn Bank. Deposit interest rates will remain unchanged, demonstrating its commitment to promoting savings as part of its social banking mission.

 

Following GSB's lead, TMBThanachart Bank (TTB) also announced a reduction in loan interest rates by up to 0.25% per annum, aligning with the MPC’s recent decision. 

 



 

TTB’s move aims to ease the financial burden on retail customers and SMEs during the ongoing economic slowdown and improve access to funding.

 

TTB Chief Executive Officer Piti Tantakasem highlighted the challenges facing the Thai economy, including domestic and international economic headwinds. 
  

He emphasised that SMEs face uncertainty due to trade fluctuations and increased competition, while retail customers struggle with high household debt.

 


“TTB is deeply concerned about the financial well-being of all our customers,” Piti stated. “Therefore, we have decided to reduce loan interest rates by up to 0.25% per annum, in line with the MPC’s decision to lower the policy rate from 2.25% to 2.00%. This adjustment is intended to ease the financial strain on our customers and boost liquidity, which we believe will contribute to the country’s long-term economic recovery.”


 

TTB will reduce its Minimum Overdraft Rate (MOR) by 0.25% per annum, and its Minimum Lending Rate (MLR) and Minimum Retail Rate (MRR) by 0.10% per annum. 


These changes will take effect on March 5, 2025.

 

The coordinated response from Thailand's banking sector underscores the collective effort to bolster the economy by reducing borrowing costs. This strategy aims to stimulate investment and economic activity, providing much-needed relief to businesses and consumers in the coming months.

(2025/03/04-00:00)