System Development on the Resolution of Non-Performing Loan Debts of Financial Institutions

Abstract

This research article aims to study (1) the concepts and theories related to the resolution of the non-performing loan debts of financial institutions; investigates (2) the problems of the resolution of the non-performing loan debts of financial institutions; compares (3) the law concerning the resolution of the non-performing loans of financial institutions in Thailand and abroad; and proposes (4) an amendment of the law regarding the resolution of the non-performing loan debts of financial institutions in Thailand. This research is qualitative research and collecting data through documentary research, in-depth interviews and focus group discussion. Data were analyzed using content analysis techniques and interpreted comparison.

Findings are as follows: Major guidelines to amend the Financial Institutions Business Act, B.E. 2551 in three issues as follows. (1) The process for the resolution of non-performing loans and payment in accordance with the fair value of debts or collateral should be prescribed. (2) The Bank of Thailand or public agencies should be designated to monitor, mobilize, or play a role in the resolution of non-performing loans. (3) The process of the compulsory performance with the debt collateral of non-performing loans should be designated. Financial institutions as creditors or mortgagees should be able to have the enforcement of mortgages without having to file cases in court and they should be able to conduct auctions.