Thai Airways appoints president and secures bank loans

Singapore
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Thai Airways International has appointed the country's former energy minister as its new president and the loss-making national carrier and it has also secured funding from government banks and other financial institutions.

The Star Alliance carrier says in a statement the board has appointed Piyasvasti Amranand has president.

He was the country's energy minister from October 2006 to February 2008 and during that time helped to privatise energy-related state enterprises.

This year in May he resigned as chairman of Kasikorn Asset Management so he could run for the position at Thai Airways.

Piyasvasti reportedly had the backing of the country's finance ministry, a claim the airline's chairman Ampon Kittiampon denies.

Ampon says the fact Piyasvasti has no airline experience is irrelevant and that Piyasvasti was chosen because of his leadership, knowledge, track record and vision.

In the same statement Thai Airways reveals it has secured 23 billion Thai baht ($675 million) of funding from four banks: the Government Savings Bank, Bangkok Bank, Kasikorn Bank and Siam Commercial Bank. These are five-year loans with 5-5.5% interest per annum, it adds.

Thai Airways posted a first quarter profit but prior to that it posted a series of quarterly losses that caught the attention of the public and the government and led to a management shake-out. The company is now embarking on a financial turnaround plan.

It had originally ben hoping to get money directly from the government but Thai Airways' chairman of the executive board, Wallop Bhukkanasut, told ATI earlier this month it would be getting money from banks to help with its short term borrowings.

He also said later this year the carrier would seek to raise more cash either by issuing shares or bonds.