Q3 loan growth at 11.6%
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Thai commercial banks' credit growth remained brisk in the third quarter, at 11.6 per cent from the same period last year, according to the Bank of Thailand's data.
Still, the growth rate slightly decelerated in line with a decline in private investment and consumption.
Business loans, accounting for 69.6 per cent of total loan portfolios, expanded only 9.9 per cent. Loans to SMEs, accounting for 37.1 per cent of total, however rose by 14.7 per cent on year. Consumer loan growth also decelerated to 15.7 per cent, with a decline in all categories particularly car loans.
Commercial banks showed the 9.3 per cent growth in deposits. This widened the loan to deposit ratio in the quarter to 90.1.
Despite loan growth, the Thai banking sector showed substantial strengths with gross non-performing loans and net non-performing loans at 2.2 per cent and 1 per cent, respectively.
"In preparation for future risks, Thai banks set aside additional loan loss provisions which pushed the combined provisions to 167.4 per cent of the NPL value," said Anupap Kuvinichkul, senior director, Financial Institution Policy Group.
In the quarter, combined net profit of the Thai banking sector totalled Bt54.4 billion. This showed a slight drop from the previous quarter, when a bank reported a huge non-recurring income. Excluding the non-recurring income, the quarterly earnings showed the increase of Bt6.1 billion or 12.6 per cent from the previous quarter.
Return on assets in the quarter also rose to 1.4 per cent.
Under the plan to grow SME and consumer loans, the net interest margin rose to 2.58 percentage points.
The Thai banking system's capital fund also rose to 16.5 per cent, with 13.1 per cent being tier-1 capital.
