Krungsri net profit leaps

Performing loans increased by 6.3 per cent in the first half, growing Bt43.5 billion since end-December 2011. Over the same period, retail loans grew by 12 per cent, driven by strong demand for auto instalment and personal loans along with strong credit-card volume.

Non-performing loans (NPLs) dropped significantly, the result of continued focus on risk management, portfolio monitoring and commitment to drive down bad loans, the bank says.

Mark Arnold, president and chief executive officer of Krungsri Group, said total assets reached Bt1 trillion for the first time. Performing loans grew by 6.3 per cent, while NPLs dropped by 18.1 per cent from the end of last year. Its NPL rate now stands at 2.9 per cent.

"Our outlook for the second half of 2012 is very positive, driven by robust loan demand from auto hire purchase and unsecured loans as well as a strong commercial lending pipeline. We are confident that we will achieve our 11-per-cent loan-growth target despite the headwinds from the euro crisis and the China slowdown," Arnold said.

As of June 30, Thailand’s fifth-largest bank recorded Bt757 billion in loans and Bt1.035 trillion in total assets. The bank has a strong capital base with a Bank for International Settlements ratio of 16 per cent and Tier 1 capital of 11.5 per cent.

Meanwhile, TMB Bank announced a net profit of Bt1.26 billion for the second quarter of this year, a 22.4-per-cent increase from the first quarter and 5.7 per cent from the same period last year.

Boontuck Wungcharoen, CEO of TMB Bank, said it was able to enhance both its interest income and non-interest income. Net interest margin (NIM) increased to 2.67 per cent, up from 2.51 per cent in the first quarter and 2.45 per cent in the second quarter last year on the increase in loans and well-managed cost of funds.

In addition, net fee and service income grew by 16.4 per cent from the first quarter, mainly driven by commissions generated by the bancassurance business and credit-related transactions.

Total loans in the second quarter grew by 5.1 per cent from the first quarter and 6 per cent from the end of 2011. The growth was supported by increases in business loans.

Meanwhile, total deposits rose by 7.2 per cent from the end of last year. The continuous growth in deposit volume was largely due to the "Make THE Difference" campaign products and services.

In terms of liquidity management, TMB Bank has continued its prudent policy by maintaining a high level of liquidity. The loan to deposit ratio (LDR), also taking bills of exchange into account, was 86.5 per cent at the end of second quarter.

Bad loans declined by Bt2.3 billion from the end of first quarter to Bt28.17 billion while the NPL ratio on a consolidated basis dropped from 5.84 per cent to 5.58 per cent.

On a bank-only basis, the NPL ratio was reduced to 5.17 per cent. A loan-loss provision of Bt932 million was set aside in the second quarter, raising the bank’s coverage ratio to 79 per cent from 74.0 per cent at the end of first quarter.

TMB Bank maintained strong capital adequacy. Its capital adequacy ratio stood at 18.7 per cent while Tier 1 capital ratio was at 11.5 per cent.