Households’ repo-rate expectations and estimated long-run interest rates Per cent 7  7  6  6  5  5  4  4  3  3  2  2 Variable mortgage rate, expectations 5 years ahead  1  1  Variable mortgage rate, outcome  0  0 10  11  12  13  Note. The broken lines show an interval for the long-term level of the variable mortgage rate. The interval is calculated as the total of an interval for the long-term repo rate of 3.5–4.5 per cent and an interval for the difference between a three-month mortgage rate and the repo rate of 1.7–2 percentage points. Sources: The National Institute of Economic Research and Statistics Sweden  BIS central bankers’ speeches  13
To ensure that Thailand reaps the benefits of the changing landscape and is in the position to mobilize resources for investment and support economic growth, the Bank of Thailand is set to launch the second phase of our financial sector Master Plan this year to further enhance efficiency, robustness, and competitiveness of the Thai banking system. Our Financial Master Plan Phase II aims to promote financial system efficiency so that financial institutions can perform their functions more efficiently, becoming more competitive, with increased financial access to the public. The plan essentially comprises three pillars. The first pillar is to improve the regulatory environment and to reduce the unnecessary regulatory and legacy costs. The focus in this pillar will be on streamlining regulation, and on promoting measures and incentives to deal with legacy NPA and NPL, without compromising prudential oversight or good risk management. The second pillar is to enhance efficiency by injecting more competition into the financial system. The focus will be on financial liberalization, increasing competition from the current and new players, and promoting greater financial access. The latter will give importance to expanding the retail banking businesses and promoting new microfinance business models and players. And the third pillar is to substantially improve the economy’s financial infrastructure in the areas of risk management, credit information system, legal reform, information technology, and upgrading the quality of human resource. Such infrastructure is crucial for banks so that they can attain greater efficiency and more effective risk management at a lower cost.