Thai bank in giant properties sale

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Thai bank in giant properties sale 
The Nation: 13 Jan 2010
Giant asset sale, as 270 properties must be moved out

Kiatnakin Bank hopes to sell 270 assets worth |Bt1.5 billion at a discount of up to 60 per cent within a month, as property investment is attractive during an economic recovery.

President Tawatchai Sudti-kitpisan yesterday said most of the non-performing assets (NPAs) of the bank were bought from the Financial Sector Restructuring Authority during the economic crisis.

The bank has selected the |270 assets out of 2,300 for sale |at 20-60-per-cent discounts until February 10. Sixty-five |per cent of the assets by value is land, 12 per cent single-family homes, 6 per cent commercial buildings, 3 per cent office buildings and 1 per cent townhouses. Prices run from Bt500,000 to Bt60 million.

The bank has Bt7.3 billion worth of NPAs and Bt15 billion in outstanding home loans.

"We expect all of the assets |to sell out. Besides, we're also offering customers loans for |up to 95 per cent of the asset |price at zero interest for the |first nine months. After that, they'll be charged the mini-|mum lending rate (MLR) minus 1 percentage point. If they are established customers of the bank, they will receive zero interest for 12 months," Tawatchai said.

If an established customer pays by cash and is ready to |transfer the asset within seven days, he'll receive a discount of Bt15,000. Otherwise, the discount will be Bt10,000 for new customers.

All assets must be transferred by March 10. The bank's MLR |is quoted at 6.35 per cent at |present.

This year, investors will |be more interested in real |estate, especially vacant land, because interest rates remain |low and the equity market is |stable, Tawatchai said. And the economy is recovering, so undeveloped land is a good investment.

"This year, developers will |buy more land, because last |year they were very careful |about operating their busi-|nesses, but they still could sell |out their housing projects, so |they have to stock up on land again," he said.

Apart from the NPA sale, the bank will allow investors to join the auction of six properties with good locations, such as vacant land in Sukhumvit Soi 31 and |the Pinklao area, with prices slashed from Bt99 million to Bt70 million.

There is also land 120 meters from the beach in Phuket going for Bt200 million, down from Bt271 million, and 37 units of Pinklao Condominium, now selling for Bt100 million for the entire batch instead of Bt149 million.

Interested bidders may re-|gister from February 1-3. Re-|sults will be announced on February 4.
The bank expects to finish selling all of its NPAs in two to five years.