of bank license - retail bank and other incentives. the tier1 capital requirement of 250 million baht for retail banks will be conducive to their specialized lending to retail customers. in order to enhance delivery channels of retail banking, the bank of thailand will allow and encourage commercial banks to use customer contact points other than their own branches and sub - branches by means of alliance with post office branches and telecom companies ’ service points, for instance. moreover, banks can capitalize on lower capital charge for performing retail loan portfolios if they pass both small size test and non - concentration test, with risk weight of 75 percent for loans to retail customers or smes and only 35 percent for fully collateralized housing loans. these are the risk weights proposed by the draft basel ii accord. however, for those who fail to adapt, these forces of change may inflict threats raised by more intense competition from non - bank players and existing foreign banks. the competition is particularly intense in consumer credit segment with mushrooming non - bank credit institutions that offer more relaxed lending conditions for consumer credits, with faster services - some applications are approved within half an hour. moreover, if qualified existing foreign bank branches or office of international banking facilities choose to upgrade their status to subsidiary, they will be allowed to have some branches, inserting more competitive pressure on the existing players. despite low household debt of less than 30 percent of gdp in thailand, the rapid growths of personal credit and credit card advances, in particular, are a potential source of our concern, especially for low - income customers. due to consumption - orientated feature of this type of credit, this group of customers might develop a habit of living beyond their means, causing their debts compounding faster than income. therefore, we will be on a careful watch of this segment of retail banking. currently, the bank of thailand, in consultation with the industry, is in the process of issuing additional measures to ensure the integrity and soundness of personal credit sector. another area that alerts our attention is intense competition among non - bank credit institutions for credit card advances. outside the purview of the current supervisory scope of the bank of thailand, they are part and parcel of the retail credit market. their relaxed lending practices may attract irresponsible borrowing by undisciplined consumers who may bring themselves and their family to financial distress. it is in the interest of consumers that these credit institutions are prudently managed and sufficiently supervised - the role that will be

governor veerathai ’ s statement your excellency, fellow governors, ladies and gentlemen, members of the press, a very good afternoon to you all, it is my great pleasure to welcome our distinguished guests to this special event before the year ends. let me extend a very warm welcome to governor agus and governor muhammad ibrahim who have both travelled to bangkok specifically for this occasion. the year of 2016, which is coming to the end soon will be remembered by economists and financial professionals as a year of the unexpected, beginning from china's circuit breaker in the very first week of the year, to negative policy rates, to brexit and the us elections. greater uncertainties now hang over the global economy. fortunately, our asean region, with its high potential, is a bright spot in the world. this is therefore time for us to navigate today ’ s uncertainties through our concerted efforts to bring out the potentials of our asean region. what we are witnessing here today is a renewal of the spirit of regional integration by relying more on collaboration to serve as a key driver for sustainable growth to benefit all of us. the mous that we are about to sign will provide flexibilities on foreign exchange regulations for the settlement of trade and investment in local currencies, resulting in greater efficiency and convenience for businesses. another key merit of this framework is that businesses will be able to better manage exchange rate risks. this is because our local currencies are generally correlated with each other. also, there will be less reliance on currencies of advanced countries which last year account for over 85 percent of thailand ’ s trade with indonesia and malaysia. you may recall that earlier this year, bank negara malaysia and the bank of thailand implemented a ringgitbaht arrangement in march as a pilot project. since then, we have seen a noticeably narrower spread between the ringgit and the baht. moreover, we have noted an increasing number of businesses applying this local currency scheme in their day - to - day business conduct. today, i am very delighted that bank indonesia is carrying on this initiative by signing the mous with both bank negara malaysia and the bank of thailand. i really hope that this scheme will continue to expand to other countries in the region. ultimately, this would be one important step closer to having greater regional financial integration in asean. on this note, may i invite governor agus to say a few words, and followed by governor muhammad ibrahim. thank