Flood insurance claims lead to inflows of $2b

Bangkok: Thailand has recorded about $2 billion (Dh7.3 billion) of inflows stemming from insurance claims related to this year's floods, Bank of Thailand Governor Prasarn Trairatvorakul said.

The fund inflows have been balanced by outflows linked to overseas investment by Thai companies and the sale of emerging market assets by overseas investors, Trairatvorakul told reporters yesterday.

Affected companies will start buying replacement machinery in the first quarter, boosting capital outflows, he said. The impact on the baht may be limited as some companies have opened foreign currency deposit accounts for insurance claims, and those funds won't be converted into baht. Other claims may be paid to parent companies outside Thailand, he said.

"These two methods won't have any impact on the baht," he said but added the baht is expected to be volatile in 2012 because of global economic uncertainties.