On December 15 2011, the Bank of Thailand issued policy guideline no. 58/2011 allowing foreign banks with branches in Thailand to convert to subsidiaries, each of which can have a maximum of 20 branches and 20 off-premises ATMs throughout Thailand. There are 15 foreign banks with branches in Thailand, and one subsidiary of a foreign bank.
The policy is part of the measures of the second phase of the Financial Sector Master Plan jointly drawn up by the Ministry of Finance and the Bank of Thailand. Each has issued a notification prescribing detailed procedures.
A foreign bank branch can submit an application to convert into a subsidiary between January 4 and December 28 2012. The branch must maintain a capital adequacy ratio of not less than 12% and a non-performing loan ratio not exceeding 3.5%, have a good rating under the BOT's rating assessment and have a good risk management system. Upon commencement of operation, the subsidiary must have paid up capital of not less than THB10 billion ($316 million).
The policy allows foreign banks with branches in Thailand to get a foothold in Thailand before Asean integration in 2015.