The Bank for Agriculture and Agricultural Cooperatives (BAAC) aims to limit its non-performing loan (NPL) ratio, keeping it from exceeding 4% of total outstanding loans through debt restructuring measures.
The bank's NPL ratio stood at 3.95% of its loan portfolio worth 5 trillion baht in September, down from 4.03% logged in March.
The bank's one-year debt suspension programme will end in June next year. Some 3.25 million farmers entered the programme, representing a total debt value of 1.45 trillion baht.
The BAAC will continue to restructure debts for borrowers clustered in the green zone, classified as those with normal debt-servicing ability, to prevent these loans turning into NPLs, said BAAC senior executive vice-president Surachai Rusmee.
Some 72% of borrowers in the debt restructuring programme are in the green zone.
For borrowers clustered in the yellow zone, the bank will restructure this debt segment until next month, said Mr Surachai.
The Bank of Thailand will not classify loans in debt restructuring schemes as NPLs if they are successfully restructured before the programme ends. Some 23% of borrowers in the programme are in the yellow zone.
The orange zone cluster signifies borrowers needing both debt restructuring and income rehabilitation. Only 3% of borrowers in the programme are in this zone.
The red zone cluster classifies borrowers with debt-servicing problems who need help to reduce their debt burdens. The cluster makes up 2% of the total.
The black zone cluster, which accounts for less than 1%, is categorised as a debt write-off because of borrowers' inability to pay off their debts.
For borrowers able to service their debts normally, the BAAC has a campaign to return 10-20% of interest payments to borrowers, which will be forwarded for approval to the bank's board of directors later this month.
The BAAC has been offering low-interest loan programmes worth a combined 220 billion baht to help affected farmers this year.
The BAAC is Thailand's largest lender for agricultural loans, with total loan value worth 1.5 trillion baht covering 6 million households.