BBL keen on mega-projects, but commercial loans still key
Top bank mapping up plan for 2014, sticks to conservative growth
Bangkok Bank, the country’s largest, will pencil in the government’s mega-project schemes into its loan growth assumptions for next year, but commercial loans will remain the key driver.
President Chartsiri Sophonpanich said yesterday that BBL’s loan growth target of 6-7 per cent for this year did not include lending to mega-projects. Loan demand from the infrastructure projects will be seen next year.
The bank is preparing its 2014 business plan.
Public investment requires time to start implementation, so commercial customers are the priority.
They account for 71 per cent of the loan portfolio, while consumers are only 13 per cent and international branches 16 per cent.
Even though public investment is a boon for the banking industry, BBL still sticks to conservative growth.
The bank is issuing US$500 million (Bt15.59 billion) in five-year and $500 million in 10-year unsecured senior notes under its $3-billion global medium-term note programme.
The notes will support loan demand from corporate customers overseas and the bank’s international network. Banks should carefully look after their liquidity and play a bigger role in promoting savings among the public, as savings are important for developing the country, Chartsiri said.
The loan-to-deposit ratio of the banking industry in August showed a tightening to 95.7 per cent from 94.9 per cent in the previous month.
In the first eight months, the bank’s loans grew by 5.1 per cent and its deposits by 1.9 per cent.
The bank’s loan-to-deposit ratio (L/D) of 88-89 per cent had not tightened and the bank will attempt to sustain this level.
Lowest among top four
In the first eight months, BBL showed the lowest growth among the four top banks, with an L/D of 86.3 per cent.
Siam Commercial Bank enjoyed the highest loan growth of 8.1 per cent, while its deposits increased by 7.6 per cent. Its L/D is 93 per cent.
Krungthai Bank posted loan growth of 9 per cent and deposit growth of 4.1 per cent, and its L/D is 93.2 per cent.
Kasikornbank’s loans were up 6.6 per cent and deposits up 9.1 per cent. Its L/D is 89.4 per cent.
Chartsiri is optimistic that the US government shutdown will not impact the global and Thai economies, believing the US government will eventually find a way to solve this problem, including the debt ceiling.
