Thailand to get $5b credit

Thailand to get $5b credit

TOKYO (AFP): Major commercial banks from the United States, Europe and Asia decided yesterday to provide a line of credit worth up to US$5 billion to help defuse Thailand's currency crisis, a Japanese report said.

The banks will negotiate terms of the line of credit with the Thai government as part of a multilateral support program and form a syndicate of bank members, the Nihon Keizai Shimbun said.

The leading economic daily said in its evening edition that Japanese banks might provide half of the line of credit as they are Thailand's biggest creditors.

The move was to follow public aid plans likely to be announced later in the day by the International Monetary Fund (IMF) and the Export-Import Bank of Japan (Ex-Im Bank).

On Sunday, Nihon Keizai reported the IMF and the Ex-Im Bank were to jointly provide about eight billion dollars in emergency loans to Thailand.

The IMF is expected to provide some four billion dollars in short-term loans and the Ex-Im Bank up to four billion dollars.

The private sector aims to compliment the IMF and Ex-Im Bank programs which will cover a shortfall in Thailand's foreign currency reserves to help reconstruct its economy, the newspaper said.

But it is still uncertain if the private sector loans would be extended, Nihon Keizai said.

It is, the line of credit will probably be provided for a period of two-to-three years, the newspaper said.

Syndicate members are expected to include two Japanese banks, Sakura Bank Ltd. and Bank of Tokyo-Mitsubishi Ltd., and J.P. Morgan Inc. of the United States, it added.

Officials from Sakura Bank and Tokyo-Mitsubishi declined to make any immediate comment on the report.