On Tuesday, Thailand’s Cabinet approved the appointment of Mr. Vitai Ratanakorn, Director of the Government Savings Bank, as the next Governor of the Bank of Thailand (BOT), set to assume office on October 1.
Analysts at Krungsri Securities (KSS) and Kasikorn Securities (KS) expect this leadership change to usher in a more accommodative monetary policy stance, a move widely seen as supportive for the SET Index and interest rate-sensitive sectors.
Amid economic uncertainties stemming from U.S. trade policies, Krungsri Securities (KSS) highlights that with the central bank’s leadership transition now finalized, the focus will likely shift to rate cuts—possibly two times before year-end—especially after Thailand has maintained positive real yields for 26 consecutive months.
The 1-year Thai government bond yield of 1.427%, below the policy rate of 1.75%, signals the market is anticipating multiple interest rate cuts. The brokerage firm estimates that every 25-basis-point cut is expected to buoy the SET Index by 50-55 points.
Interest rate-sensitive sectors such as utilities, telecoms, real estate, and REITs are positioned to benefit, with the analyst suggesting accumulation of names such as GULF, ADVANC, LH, SPALI, WHAIR, FTREIT, 3BBIF, KTC, and CPALL.
Kasikorn Securities (KS) notes Vitai’s proven track record in transforming the Government Savings Bank into a leading social bank and the commitment to expanding non-bank business, with a focus on providing low-interest funding sources and supporting broader access to credit for SMEs.
Vitai advocates the principle that “the central bank must be independent, but not isolated.” He believes previous policy rate adjustments have been too slow and has proposed a three-pronged strategy for addressing debt challenges.
His approach includes promoting economic growth, reducing lending rates, and implementing additional measures—such as transferring non-performing loans out for more effective management.
He further emphasized that reducing lending rates is a vital tool to help households ease their debt burden. By bringing interest rates down, borrowers can repay more principal even with the same monthly payment, helping to reduce overall household debts.
Kasikorn Securities expects that financial stocks could see a short-term boost from speculation around further BOT rate cuts, with every 25 basis-point rate cut potentially adding around 5% to sector profits.
However, the analyst warns that, in the medium term, lower lending rates could pressure finance sector profitability, with every 100 basis-point decline in loan yields impacting 2026 earnings by 15-20%. As such, the analyst does not recommend buying finance stocks at this stage as the market has priced in this matter.
Within the banking sector, a reduction in bank lending rates by every 25 basis points could dent large bank profits by 5-10%. The brokerage firm highlights KKP and TTB as preferred picks.
For exporters, a weaker baht—potentially triggered by greater-than-expected rate cuts—could generate positive sentiment. KCE is recommended as a beneficiary, with a ‘Buy’ rating and a target price set at THB 23 per share.
Lower interest rates and improved access to loans are also expected to indirectly support retailers and real estate firms, especially names such as CPALL and SPALI.
On the broader market, as the analyst forecasts the policy rate at 1.50%, an additional 25 basis-point cut could lift the SET Index by around 25-30 points. Meanwhile, much of this upside may already be priced in.
