Thai banks, stock exchange re-open

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Thai banks, stock exchange re-open 
The Nation: 24 May 2010
Banks and stock exchange to reopen today
By THANONG KHANTHONG
THE NATION
Published on May 24, 2010

Both the banking system and the capital market are likely to operate smoothly when business returns to normal today after the military crackdown on the protest rallies and yesterday's huge clean-up of the capital.

Prasarn Trairatvorakul, president of Kasikornbank and chairman of the Thai Bankers' Association, said yesterday that the operating systems of all banks were in order and they were expected to function normally.

"We only have to move up the cheque-clearing system a bit to keep up with the curfew, which will still be imposed tomorrow," he said. "But overall we expect the banking system to function without any problems."

Banks and the bourse closed last Thursday and Friday on warnings from the government that soldiers would launch a crackdown on the red-shirt rallies at Rajprasong. The military operation was successful, resulting in minimum casualties and damage. It also put an end to more than two months of demonstrations by the red shirts, which almost brought the economy to a standstill.

More than 10 branches of Bangkok Bank including their ATMs were nearly destroyed and looted by the protesters in the aftermath of the military crackdown.

"It was quite appropriate for the banks to close during the period, for we could see that the protesters were attacking symbolic targets," Prasarn said.

Bandid Nijthaworn, deputy governor of the Bank of Thailand, also said banking officials would be on alert for any disruptions to the financial markets as a whole. "We'll be monitoring the situation closely," he said.

Prime Minister Abhisit Vejjajiva appeared on his Sunday TV programme to assure the public that the government had brought the crisis under control after two months of a mini civil war. "Everything is calm and returning to normalcy," he said.

However, authorities have decided to extend until tomorrow a curfew in Bangkok and 23 provinces. The measure, which will be enforced between 11pm and 4am, would remain in place for security reasons.

The Stock Exchange of Thailand was also due to resume trading today for the first time since Wednesday. Its building on Ratchada-phisek Road was one of 36 sites torched by militant red shirts who went on a rampage after their leaders were forced to surrender.

Chaiyaporn Nompitakcharoen, head of research at Bualuang Securities, said investors were likely to stage a comeback to the equity market and welcome the authorities' ability to bring the situation under control.

He said overall claims for damages arising from the anti-government rally could reach about Bt50 billion.

"This is manageable since it is equivalent to around 0.5-0.6 per cent of gross domestic product," he said.

In the short term, Chaiyaporn expects the local market to make a rebound because investors still have an appetite for Thai equities. Late last week, global markets reacted quite negatively to the troubles in European markets and the Asian markets also took a hit. But Chaiyaporn said the Thai market was now trading at a price-to-earnings ratio of 11 times, compared to the 12.8 average for Asian markets, so it might have room to go up to near the 800-820 range.