Krungthai Bank (KTB) president Payong Srivanich has clarified that the allegations against a former executive linked to loans extended to Energy Earth were made to protect the bank's interests.
KTB needed to take action because the loan extension had a huge impact, he said, adding that as a state-owned bank KTB cannot ignore the probe outcome.
Kittiphun Anutarasoti, now chief executive of CIMB Thai Bank (CIMBT), has taken a voluntary leave of absence until the end of March in the wake of KTB's allegations against him.
The KTB probe's findings accused Mr Kittiphun of misconduct and fraud for his own and others' benefit, resulting in huge damage to KTB from loans extended to Energy Earth when he was a high-ranking executive at the bank overseeing the corporate banking business.
KTB, Energy Earth's largest creditor, launched a probe into the 12 billion baht granted to Energy Earth after the coal miner failed to redeem two lots of bills of exchange worth 90 million baht that were due in June 2017.
The default has had a snowball effect on the coal miner's business operations.
The bank also filed a complaint with the Department of Special Investigation to look into an accusation that Energy Earth might have used a fabricated coal import document to seek a 12-billion-baht loan from the bank.
KTB's initial probe accused Energy Earth of forging a shipping document claiming it had imported coal from Indonesia to back a loan request.
Mr Payong said the bank needs more information associated with Energy Earth's loan utilisation objective to decide whether the company misused the bank's loan, but KTB has yet to receive the requested information.
The bank stands ready to find solutions to help Energy Earth resume operations after the Central Bankruptcy Court turned down the business rehabilitation plan arranged by EY Corporate last year.
Previously, the Securities and Exchange Commission (SEC) denied an extension for Energy Earth to submit a fair value review of two coal mine concessions in Indonesia, as the submission deadline was Dec 31.
The market regulator demanded that Energy Earth submit the review, as well as a complete report of the company's ownership rights in the two coal mines.
The information must be disclosed via the Stock Exchange of Thailand's information system.
