Debt restructuring praised

Debt restructuring praised

BANGKOK (AFP): Thailand has struck the right balance between
government intervention and private action in restructuring its
corporate debt, reports said Saturday.

The chief regional counsel for Chase Manhattan Bank, John
Knight, dismissed local criticism that the pace of debt
restructuring was too slow.

"Here we are talking about a large number of companies in the
economy that have gone insolvent, so the process is going to take
time," Knight was quoted as saying by The Nation daily.

A large number of Thai businesses became insolvent when the
regional economic crisis erupted here in mid-1997.

"Now it is truly the responsibility of the banks and
shareholders to do their jobs in getting the deals closed," said
Knight, who also sits on a debt restructuring committee set up by
the Indonesian government.

But Knight added that the Thai crisis had revealed other
weaknesses which also needed to be addressed. These ranged from
underdeveloped legal and accounting practices to an ill-prepared
government bureaucracy.