Commercial banks' quarterly operating profit jumps 12.6% from second quarter
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Commercial banks raised their operating profit by 12.6 per cent to Bt54.4 billion in the third quarter of this year from the second quarter on continued credit expansion.
According to Bank of Thailand data, bank loans rose by 11.6 per cent and deposits by 9 per cent from the third quarter of last year.
Banks’ combined net profit showed a slight drop from the previous quarter, when one bank reported huge non-recurring income.
“In preparation for future risks, banks set aside additional loan-loss provisions, which pushed combined reserves to 167.4 per cent of the value of non-performing loans,” Anupap Kuvinichkul, senior director of the Financial Institution Policy Group, said yesterday.
Credit growth decelerated slightly in line with falling private investment and consumption. Business loans, accounting for 69.6 per cent of the lending portfolio, expanded only 9.9 per cent. Loans to small and medium-sized enterprises, accounting for 37.1 per cent, climbed by 14.7 per cent year on year. Consumer-loan growth also decelerated to 15.7 per cent, with a decline in all categories, particularly car loans.
In the quarter, bank deposits rose by 9.3 per cent. This pushed up the loan-to-deposit ratio in the quarter to 90.1 per cent.
Despite extending more credit, banks showed substantial strength with gross non-performing loans at 2.2 per cent and net NPLs at 1 per cent.
Return on assets in the quarter improved to 1.4 per cent.
Under the plan to grow SME and consumer loans, the net interest margin swelled to 2.58 per cent.
The banking system’s capital adequacy was beefed up to 16.5 per cent, with 13.1 per cent consisting of Tier 1 capital.
