What is Specialized Financial Institutions?
Specialized Financial Institutions (SFIs) are financial institutions established by specific law to support government’s policies by providing financial services, especially loans to people who are unable to obtain source of fund from commercial banks. Finance Minister is entitled for the power for SFIs supervision and has assigned the Bank of Thailand to supervise SFIs on prudential issues.
SFIs’ mandate, which is responding to government policies by providing financial services to people who are unable to access to source of fund, has been beneficial to the whole economy in many ways, including
On 2nd of December 2014, the cabinet approved State Enterprise Policy and Supervision Committee’s decision to assign BOT as SFIs supervision entity. BOT’s responsibilities include issuing regulations, verifying qualification of SFIs’ executives, examination, and ordering a resolution plan. While the Ministry of Finance (MOF) remains its duty as the policy maker and shareholder/owner, the cabinet assigned MOF and BOT to coordinate in formulating SFIs supervision framework.
On 2nd of April 2015, Finance Minister has empowered the BOT, by virtue of Section 120 of the Financial Institution Business Act, B.E. 2551 (2008) and amendments, with authority to 1) order SFIs to provide information, facts, and opinions 2) appoint a person to examine and report on the operations and assets of SFIs 3) issue additional regulations for SFIs 4) be able to take the provision from Financial Institution Business Act B.E. 2551 with respect to the approval from the Finance Minister 5) report SFIs supervision and examination result to Finance Minister and 6) propose to the Finance Minister to consider ordering corrections in the case of SFIs violating and not complying with their mandates.