High loan growth drives up banks' net profit in third quarter

TMB Bank said yesterday that its net rose by 13.8 per cent to Bt1.437 billion in the third quarter year on year. For the first nine months, its net profit jumped by 22.7 per cent to Bt3.731 billion over the same period in 2011.
Buntuck Wangcharoen, president and chief executive officer, said the growth in profit derived from increased lending to small and medium-sized enterprise, rising bank surcharges and increased interest.
“The bank’s core operation continues to show good results both from interest and non-interest income,” he said.
He added that net interest margin increased from 2.68 per cent in the second quarter to 2.82 per cent in the third from SME loans, which increased by Bt12 billion, while lending to small customers rose by Bt3.2 billion.
Revenue from surcharges increased by 7 per cent, mainly from bancassurance and lending charges. Its cost-to-income ratio also reduced to 54.1 per cent, reflecting higher operational efficiency, he said.
Siam Commercial Bank reported third-quarter net profit of Bt10.02 billion, an increase of 20.0 per cent year on year. The surge was attributed to higher net interest income driven by robust loan growth of 20.2 per cent. Although the overall quality of the lending portfolio has continued to improve, SCB set aside higher prudential provisions to allow for future uncertainties.
Net profit stands at the highest point in any quarter, and this is mirrored by the record-high quarterly operating profit of Bt15.3 billion for the quarter. Cumulative net profit for the first nine months was Bt30.4 billion, representing an increase of 24.4 per cent over the same period last year (excluding the one-time investment revaluation gain in the first quarter of 2011).
The main driver of this high profitability was the robust loan growth, primarily in housing and automobile loans in the retail segment (up 20.7 and 39.6 per cent respectively), as well as 25.7-per-cent growth in the SME segment. As a result of this loan growth, net interest income rose to Bt16.2 billion in the quarter, a 19.6-per-cent increase from the same period in 2011.
Government Savings Bank reported that its profit was Bt24.729 billion during the first nine months. It said efficient management of income from interest, assets and debt resulted in the good results.
The bank’s interest income was Bt36.637 billion, an increase BtBt6.223 billion in the first three quarters, mainly from an increase in lending to Bt1.51 trillion from Bt263.59 billion in the same period last year.