Supervision regime
Principles of supervision

 

The BOT supervises financial institutions established in accordance with the following laws;

1. The Financial Institutions Businesses Act B.E. 2551, supervising commercial banks, Finance companies and Credit Foncier business and

2) Other laws for instance Declaration of the Revolutionary Council No. 58 on the supervision of financial businesses that have broad impact with people (i.e. Credit card business and personal loans etc.)
Financial Institutions Policy Group and Supervision Group are responsible for supervising Financial Institution

Financial Institutions Policy Group (FIPG.)​

FIPG is responsible for formulating the regulatory policies, criteria for the supervision and strategy of financial institutions and payment systems in order to foster the stability, strength and efficiency of financial institutions and payment systems, and also their competitive abilities in the market.

Financial Institutions Policy group consists of 4 departments, namely

Financial Institutions Policy Group (FIPG.)

FIPG is responsible for formulating the regulatory policies, criteria for the supervision and strategy of financial institutions and payment systems in order to foster the stability, strength and efficiency of financial institutions and payment systems, and also their competitive abilities in the market.

Financial Institutions Policy group consists of 3 departments, namely

Regulatory Policy Department is responsible for formulating the regulatory policies and supervisory criteria to ensure the stability of financial institutions in the aspects of risk and corporate governance as well as regulatory standard in compliance with the international standard. Furthermore, Regulatory Policy Department also formulates regulatory polices to financial businesses that have broad impact to people (i.e. Credit card business and personal loans etc) as well as coordinates with international organizations and central bank colleges from other countries in order to foster the creditability of Financial institution Regulation.​

Financial Institutions Strategy Department is responsible for 1) analyzing and monitoring the performance of financial institutions in order to maintain the overall stability of financial system 2) formulating strategies to support the development of financial institution system, for instance the implementation of financial Sector Master Plan 3) playing a role in stimulating the revision of financial institution laws 4) Formulating negotiation policies on the liberalization of financial services and banking services under WTO forum and other bilateral trade agreement forums.​​​

​Grants approvals to FIs and responses all queries from FIs and their financial group, assets management companies, and non-banks. Supervises the operations of them to ensure their compliance with relevant laws and regulations. Handles the licensing of new commercial banks, assets management companies and non-banks.

Regulatory Policy Department (RPD) is responsible for formulating regulatory policies for the supervision of financial institutions, financial business group and other lending business (i.e. Credit card business and personal loans etc.) in
the aspects of risk management and corporate governance. To ensure the stability of the financial system while achieving effective consumer protection, regulatory standards are designed to suit the Thai financial context, to keep up with the fast changing of business as well as to be in compliance with the international standards.

Furthermore, Regulatory Policy Department also formulates policies to foster market competition, innovation development, as well as coordinates with international organizations and regulators from other countries in order to achieve long term financial stablility of the system. ​

Financial Institutions Strategy Department is responsible for analyzing and monitoring the performance and competitiveness of financial institutions, formulating strategies to support the development of financial institution system, promoting sustainable finance, playing a role in stimulating the revision of financial institution laws, and Formulating negotiation policies on the liberalization of financial services and banking services under WTO forum and other bilateral trade agreement forums.​​​

Financial Institution Business Supervision Department regulated financial institutions and their financial group, non-banks (credit card companies, personal loan companies, nano finance companies, and peer-to-peer lending companies), assets management companies, and representative offices of foreign financial institutions.

Functions:
- To grant approval to regulated entities for undertaking business activities.
- To supervise and follow-up for compliance of regulated entities with the relevant laws and regulations, and respond to queries from those regulated entities.
- To grant a license to new regulated entities allowing them to provide services.

FIDF Management Department

Supervision Group 1 (SG1)

SG1 is responsible for supervising and examining commercial banks, financial and credit foncier companies, monitoring and assessing risks to financial institutions, and also supervising, examining and evaluating FIs' quantitative tools or risk model. There are 4 departments under the SG 1 as follows:

​BD1-2 is responsible for conducting examination and assessment of risks of commercial banks , finance companies and credit foncier companies focusing on significant activities , financial performance and capital adequacy provisioning , earning , capability, corporate governance and compliance to determine the level of inherent risks and quality of risk management , the effectiveness of 3 lines of defense or Bank’s management will be notified of any weaknesses and are required to take corrective actions in a timely manner.

SRD is responsible for
1) supervising financial institutions under the department’s purview by examining and monitoring the financial institutions’ risk management with a particular focus on major transactions (Significant Activities), assessing financial conditions as well as evaluating their capital adequacy and provisioning, earning performances, corporate governances and compliance with laws and regulations.

2) monitoring and assessing risks to financial institutions as well as the dynamics of their operations and financial conditions both at individual institution level and system-wide to support on-going supervision and the formulation of related policies pertaining financial institutions.

3) developing and upgrading processes to resolve troubled financial institutions or financial system under liquidity or solvency problems, which includes conducting crisis simulation exercises in coordination with relevant departments on a regular basis.

4) developing innovative technology to support supervisory functions to enhance efficiency in risk monitoring and supervisory process, managing and controlling standard of financial institution data usage within supervision group.

RAD is responsible for supervising, examining and evaluating FIs' quantitative tools or risk model used in risk management and/or capital calculation for credit risk, market risk and operational risk e.g., Internal Rating Based (IRB) Approach, Internal Model Approach, Contingent Loss, Advance Measurement Approach (AMA), including the assessment of Bottom-up Stress Testing conducted by FIs.

Supervision Group 2 (SG2)

​SG 2 is responsible for supervising and examining SFIs and Non-banks, supervising financial institutions on market conduct issues, and also strategic planning and examiner developing and also formulating policies and implementing relief measures to aid retail and business debtors. There are 4 departments and 1 unit under the SG 2 as follows:

SED is responsible for conducting on-site examination, off-site monitoring, and risk assessment, focusing on major transactions (Significant Activities: SA) of Specialized Financial Institutions (SFIs) ; overseeing corporate governance practices, compliance with the BOT's regulations and risk management and control of the SFIs; as well as  granting approvals or waivers to the SFIs in order to ensure that each SFI’s mandate be practically carried out and to ensure the safety and soundness of the SFIs and the stability of financial system.

SSD is responsible for examining asset management companies and non-banks in compliance with the conditions, criteria of BOT's notifications, and consumer protection. Furthermore, supervises and examines The National Credit Bureau to be in accordance with the law, and acts as secretariat of the Credit Information Protection Committee.

  
FCD is responsible for formulating regulations and guidelines as well as supervising financial institutions, both on-site and off-site, on market conduct issues in order to ensure that financial service providers’ sales are not the forced, fraudulent , intrusive and exploited. FCD also formulates and enforces market conduct notifications in order to improve quality of end-to-end-process of risk management.Besides, disclosure of product information and quality of services are sufficiently provided to ensure for better decisions of customers and to encourage fair competition in the Thai financial system. Also, FCD is responsible for operation of “Debt Clinic” which aims to help people to restructure their debt burden and encourage good financial discipline for not being indebtedness again, that will lead to their financial stability.
 
FCD collaborates with other regulators for an effective market conduct supervision. In addition, FCD gives advices on financial issues, handles complaints on financial services regarding service providers under BOT regulation for proper solutions.

PDD is responsible for formulating strategic plan of SVG, conducting annual on-site examination plan, enhancement the effectiveness of supervision, examination and monitoring of financial institutions, developing supervision manuals in line with international standards, arrangement training program to broaden knowledge and to enhance competency of examiners, handling as co-host to hold a meeting and seminar with international or domestic organizations for SVG and prepares annual action plan and budget in accordance with the BOT strategic objectives.

Supervision Group 1 (SG1)

SG1 is responsible for supervising and examining commercial banks, financial and credit foncier companies, monitoring and assessing risks to financial institutions, and also supervising, examining and evaluating FIs' quantitative tools or risk model. There are 4departments under the SG 1 as follows:

BD1-2 is responsible for conducting examination and assessment of risks of commercial banks , finance companies and credit foncier companies focusing on significant activities , financial performance and capital adequacy provisioning , earning , capability, corporate governance and compliance to determine the level of inherent risks and quality of risk management , the effectiveness of 3 lines of defense or Bank’s management will be notified of any weaknesses and are required to take corrective actions in a timely manner. ​​

  
SRD is responsible for

1) supervising financial institutions under the department’s purview by examining and monitoring the financial institutions’ risk management with a particular focus on major transactions (Significant Activities), assessing financial conditions as well as evaluating their capital adequacy and provisioning, earning performances, corporate governances and compliance with laws and regulations.

2) monitoring and assessing risks to financial institutions as well as the dynamics of their operations and financial conditions both at individual institution level and system-wide to support on-going supervision and the formulation of related policies pertaining financial institutions.

3) developing and upgrading processes to resolve troubled financial institutions or financial system under liquidity or solvency problems, which includes conducting crisis simulation exercises in coordination with relevant departments on a regular basis.

4) developing innovative technology to support supervisory functions to enhance efficiency in risk monitoring and supervisory process, managing and controlling standard of financial institution data usage within supervision group.

RAD is responsible for supervising, examining and evaluating FIs' quantitative tools or risk model used in risk management and/or capital calculation for credit risk, market risk and operational risk e.g., Internal Rating Based (IRB) Approach, Internal Model Approach, Contingent Loss, Advance Measurement Approach (AMA), including the assessment of Bottom-up Stress Testing conducted by FIs.

Supervision Group 2 (SG2)

SG 2 is responsible for supervising and examining SFIs and Non-banks, supervising financial institutions on market conduct issues, and also strategic planning and examiner developing. There are 4departments under the SG 2 as follows:

SED is responsible for conducting on-site examination, off-site monitoring, and risk assessment, focusing on major transactions (Significant Activities: SA) of Specialized Financial Institutions (SFIs) ; overseeing corporate governance practices, compliance with the BOT's regulations and risk management and control of the SFIs; as well as issuing SFIs regulations, granting approvals or waivers to the SFIs in order to ensure that each SFI’s mandate be practically carried out and to ensure the safety and soundness of the SFIs and the stability of financial system.

SSD is responsible for examining asset management companies and non-banks in compliance with the conditions, criteria of BOT's notifications, and consumer protection. Furthermore, supervises and examines The National Credit Bureau to be in accordance with the law, and acts as secretariat of the Credit Information Protection Committee.

FCD is responsible for formulating regulations and guidelines as well as supervising financial institutions, both on-site and off-site, on market conduct issues in order to ensure that financial service providers’ sales are not the forced, fraudulent , intrusive and exploited. FCD also formulates and enforces market conduct notifications in order to improve quality of end-to-end-process of risk management. Besides, disclosure of product information and quality of services are sufficiently provided to ensure for better decisions of customers and to encourage fair competition in the Thai financial system.

Also, FCD is responsible for operation of “Debt Clinic” which aims to help people to restructure their debt burden and encourage good financial discipline for not being indebtedness again, that will lead to their financial stability.

FCD collaborates with other regulators for an effective market conduct supervision. In addition, FCD gives advices on financial issues, handles complaints on financial services regarding service providers under BOT regulation for proper solutions.

PDD is responsible for formulating strategic plan of SVG, conducting annual on-site examination plan, enhancement the effectiveness of supervision, examination and monitoring of financial institutions, developing supervision manuals in line with international standards, arrangement training program to broaden knowledge and to enhance competency of examiners, handling as co-host to hold a meeting and seminar with international or domestic organizations for SVG and prepares annual action plan and budget in accordance with the BOT strategic objectives.

DRU is responsible for formulating policies and implementing relief measures to aid retail and business debtors. DRU supervises, analyzes, and evaluates effectiveness of such measures and debt restructuring by financial institutions, Specialized Financial Institutions (SFIs) and Non-Banks. In addition to engaging with related agencies (both public and private), DRU also leads and manages the DR BIZ program and facilitates debt mediation between debtors and creditors.