Dr. Rak Warakitphokatorn, Chief Executive Officer of Bangkok Commercial Asset Management Public Company Limited (BAM), was a guest on ReDo's show, providing genuinely beneficial insights.
Thairath Talk: Could you please explain to the audience what BAM's mission and responsibilities are?
BAM is a typical asset management company (AMC). In Thailand, there are about 90 AMCs. Historically, AMCs buy non-performing loans from financial institutions, then restructure the debt to generate revenue known as cash collection from the restructuring.
If restructuring fails, the final step is to seize assets to repay debts or initiate legal proceedings to convert the debtor's assets into AMC's assets. This approach has accompanied Thailand since the 1997 Asian financial crisis. However, BAM is trying to change this role.
Over the past 11 months, BAM has aimed to evolve from a traditional asset management company into a 'debt relief hospital.' Our current focus is to offer second chances to former debtors. For example, if Somchai owes 1 million baht plus accrued interest and has suspended payments, totaling 4 million baht owed to financial institutions, Somchai must restructure this 4 million baht debt with the AMC.
Today, Somchai can choose to restructure his debt with BAM specifically at a price no more than 1 million baht, which is the principal amount. With this changed perspective on his debt, Somchai has a chance to revive financially. This is why we position ourselves more as a debt relief hospital rather than just a debt collector or a typical restructuring company.
The largest portfolio of debts BAM manages is housing loans. Our goal is to enable debtors to support their families and maintain homeownership without losing their homes to foreclosure or asset seizure.
This is the starting point for BAM. When we meet our clients—whom we now call customers—the first question we ask is how much they can afford to pay, essentially 'Can you manage?' This question is the first sentence BAM poses to its debtors. On one hand, we are debt caretakers.
On the other hand, we act as brokers for secondhand properties. The first role addresses the social issue of Thailand's widespread household debt, which is near 90%, much higher than the Asian average of about 68%. This is like having a high 'blood sugar' level representing excessive debt. Thai people culturally are more willing to take on debt.
The second role is to serve as brokers, facilitating the swift return of repossessed properties into the market with new owners.
So every day BAM works against time: curing the 'debt disease' and transferring secondhand assets to new owners as quickly as possible. BAM is not like past AMCs; it is a key mechanism to drive Thailand's economy. Lenders provide good loans to foster economic growth.
I see BAM as the country's last line of defense, akin to Virgil Van Dijk, Liverpool's world-class defender, preventing opponents from scoring. Loan approvals, especially for housing loans under 3 to 5 million baht, have rejection rates exceeding 50%. Therefore, if we hope Somchai or Somying will get bank loans to buy BAM properties,
our installment sales plan, called the "Public Asset" project, allows Somchai and Somying to buy without salary slips or credit bureau checks, starting installments as low as 500 baht per month, payable for up to 20 years with possible extensions of 5 more years. This means they can become direct BAM customers instead of borrowing from banks.
Within less than four months, BAM has sold over 1,500 properties, achieving the highest asset turnover since its founding. This approach addresses society's needs, especially freelancers.
People without salary slips—housewives, security guards, delivery riders, motorcycle taxi drivers, or taxi drivers—can become BAM's distinguished customers. Normally, banks check credit reports, but BAM does not; we require only sufficient proof of income to afford installments.
We have riders and cleaning staff paying BAM installments around 3,000 baht monthly, focusing on what they can afford. BAM is experienced in debt restructuring, having long managed debt portfolios.
If someone cannot pay 3,000 baht, we ask if they can manage 500 baht. We set 500 baht as the minimum monthly payment. When able, they can increase installments back to 5,000 baht to compensate for previous shortfalls.
Our flexibility offers more options to small earners. That's the origin of the "Public Asset" project, which began last year as Phase 1, targeting properties priced up to 3 million baht, focusing on helping small earners, particularly freelancers.
Thairath Talk: I understand you recently launched Phase 2, "Public Asset Plus," increasing the price ceiling from 3 million to 5 million baht for small salaried employees earning 50,000-60,000 baht monthly who have salary slips.
Yes, including middle-level government officers earning about 30,000 baht monthly. We have MOUs with government agencies to deduct payments directly from their payroll. The property range expanded from 3 million to 5 million baht, with more attractive locations in central Bangkok and key economic provinces, offering more choices. We thus broadened our focus from vulnerable groups to middle-income earners.
These tools serve for first-time homeownership or investment properties. Owning a beautiful home worth 3 to 5 million baht that appreciates to 4.8 to 5.2 million baht over 3 to 5 years is very promising. It restores hope that previously unattainable properties are now within reach.
We offer properties priced from 80,000 baht up to 5 billion baht. Our goal is to help lower-priced properties reach new owners such as freelancers or junior government officers or military personnel living in government housing, enabling them to own homes by payroll deductions while still in junior ranks.
For low-level government officers, homes around one million baht with monthly payments under 4,000 baht are affordable given their salaries of about 20,000 baht. This helps reintegrate properties into the economic ecosystem.
Thairath Talk: If BAM doesn't use salary slips, what criteria or proof do you consider for financing?
Salary slips are a risk mitigation tool for lending. But as I told you, we do not lend; we offer installment payment plans. Therefore, we review bank statements for regular income over the past three months, which shows stability for installment payments.
To clarify, we provide installment plans, not loans. For freelancers, based on my banking experience, we know average incomes. For example, a motorcycle taxi driver earning about 1,000 baht daily from 5:30 a.m. to 2:30 p.m. can make around 30,000 baht monthly if working every day.
Knowing this, if he buys a property worth 300,000 to 500,000 baht, monthly installments of about 2,500 baht are affordable. Similarly, a housewife named Somjit earns about 15,000 baht plus overtime, totaling approximately 24,000 baht monthly.
If Somjit pays BAM installments between 2,500 and 2,800 baht monthly, this is manageable. This approach is not guesswork but based on scientific data assessing the customer's ability to pay.
Thairath Talk: With respect, aren't you concerned about non-performing loans since these vulnerable groups have unstable incomes?
Firstly, they are actively paying installments to us. The question is: who owns the property during installments?
Thairath Talk: BAM does.
The property belongs to BAM until full payment. If someone says 4,000 baht monthly is unaffordable, we ask why. Instead of dwelling on past defaults, we ask if 1,500 baht monthly is manageable for a period, say one year, then they can step up payments later. We work closely with distressed debtors, understanding their hardships as part of our daily work.
There may be occasional setbacks, but we see it as offering continual opportunities to small earners. Providing these chances is a meaningful act, as nothing is more rewarding than giving others a second chance.
Thairath Talk: Could you give an example of the lowest monthly payment for homeownership that listeners can hope for?
While we say installments start at 500 baht, most customers can afford more. Some properties are small flats or condos under 28 square meters with monthly payments around 1,500-2,000 baht, valued at about 300,000-400,000 baht. Some properties have relatively low values.
The key consideration is the buyer's capacity. As long as installments do not exceed 50% of their income, they can maintain a happy life. We offer tools to build life stability, whether for personal residence or investment.
For example, paying 3,000-4,000 baht per million baht of property value. A 1 million baht condo of 35-40 square meters in or near Bangkok can be a dream come true for small earners. Paying 4,000 baht monthly is manageable for someone earning 38,000 baht monthly, like a motorcycle taxi driver I worked with.
This represents an opportunity to build security by moving from renting to owning a home. Another opportunity is buying secondhand properties for rental income (passive income) or for resale after renovation.
Some small buyers purchase one or two properties annually, invest in renovating them, then resell. This provides business opportunities.
Today, many think startups require factories or product development, but buying and investing in BAM secondhand homes can be a startup. For example, at age 48, with savings of 1.5 million baht, buying an 800,000 baht BAM property and investing no more than 20% of the price (about 160,000 baht) for improvements totals 960,000 baht.
Selling later at 1.2 million baht yields a profit, creating a personal business venture.
Thairath Talk: Yes.
With this approach, people start investing more frequently — twice or thrice yearly, accumulating multiple units. Many small investors I interview now buy up to 15 properties annually, becoming small-scale landlords, a legitimate white-collar profession.
After buying three to five properties, they gain expertise, understanding buyer markets and demand. BAM provides six months free of charge to manage these properties.
You can manage BAM properties for six months, invest in renovations, and by month six, have buyers ready. This "6 plus 6" model means if unsold after six months, BAM can extend another six months. If still unsold, the buyer must purchase the property.
Is this fair? Absolutely. You have a BAM property working for you continuously.
Thairath Talk: Is this challenging amid global and Thai political uncertainties?
The economy is weak, and globally, nobody wants to invest or buy. I see it differently. Growing up in a family where grandparents bought land, shop buildings, and markets as investments, which proved valuable over time.
Secondhand properties (NPA) are the same investment choice as 50 years ago. If you do not buy land, many consider stocks or gold.
However, as you mentioned, gold and stocks fluctuate with economic instability, but land prices have steadily increased for 50 years.
Annual land value appreciation of 3%, 5%, or 7% outperforms bank deposit interest rates. That's the first equation. The second is rental income of 7-10%, totaling about 15% return, making secondhand property an attractive investment.
Our message today is to encourage secondhand properties as investment options, returning to the mindset of past generations who invested in land and buildings to fund education, rather than stocks or gold.
They chose tangible assets like land and shop buildings to secure their families' future.
Thairath Talk: This vision is excellent. At times when people hesitate to invest, you invert the approach, emphasizing that land and housing prices only rise.
Correct.
Thairath Talk: For listeners interested in BAM, what contact channels are available?
First, assess your financial health. For example, if you earn 100 baht monthly, you should allocate 20-30% to savings and investment.
If you can invest in BAM properties at no more than 4,000 baht per million baht, then with a 20,000 baht salary, 4,000 baht is under 20%. You can own a home or condo that serves as both a dream home and an investment.
In times of crisis, this property becomes a safety net, built from your own hard work.
Thairath Talk: What is BAM's vision for the next 3 to 5 years amid this challenging economy?
We aim to position BAM as the "Partner of Choice," supporting people at every life stage—from small earners like motorcycle taxi drivers and housekeepers to business owners and wealthy investors. We offer properties ranging from 80,000 baht to 5 billion baht, catering to all income levels and investment needs.
Thairath Talk: As an executive, how do you feel when you see people who were about to lose their homes regain stability with BAM's help?
It warms my heart. Beyond the individual, I consider their families, who can continue supporting education. Many join BAM's debt relief clinic, like those in the "Suk Jai Dai Ban Kuen" program, which allows gradual installment payments after asset seizure, turning debtors into paying customers.
The distinction between debtor and customer is profound. Transitioning from debtor to customer removes the burden and suffering, as they no longer pay off debts but pay installments on their own property and continue living there.
For example, when BAM buys assets from financial institutions, we can offer small earners the chance to own those assets. While banks see them as debtors, BAM allows them to repay through installment sales without eviction, transforming their lives.
They move from overwhelming debt to being BAM's installment-paying customers. This is a new tool in today’s volatile economy—viewing oneself as a BAM customer changes the narrative.
Thairath Talk: For those interested, how can they contact BAM?
We have 24 branches nationwide, many people pass by BAM branches regularly. We also have a Call Center for direct calls and the BAM Choice application, downloadable on all operating systems, bringing our services closer to customers.
Follow BAM at BAM Thailand.
Website: https://www.bam.co.th
Facebook: https://www.facebook.com/onlineBAM
Instagram: https://www.instagram.com/bamthailand