By SOMLUCK SRIMALEE
Most of their non-performing-loan ratios in the quarter were nearly the same as a year earlier. Some saw their NPL rates increase by a few percentage points but did not exceed 5 per cent, except Krungthai Bank, which reported NPLs worth Bt100.38 billion, 10.15 per cent of total lending.
Asia Plus Securities forecasts that the banking sector’s overall net profits will grow by more than 7 per cent this year.
Siam Commercial Bank, Kasikornbank and KTB reported the highest net profits among the 10 banks (see graphic).
SCB president and chief executive officer Arthid Nanthawithaya said in a press release that the bank was satisfied with the quarterly financial results. This year its transformation project will be a key element in strengthening the bank and paving the way for it to become the most admired bank, the release said.
“We are focusing on developing staff capabilities so they can adapt to changes and respond to new business models and client needs in the future,” he said.
SCB and its subsidiaries announced a net profit of Bt11.91 billion for the first quarter of this year (based on unreviewed consolidated financial statements), an increase of 13 per cent from the same period last year. The increase was a result of higher net interest income and higher net fee and service income, as well as a decline in net insurance claims.
KBank ranked second in net profit with Bt10.17 billion in the first quarter, up 5.45 per cent over the same period last year.
KBank president Predee Daochai said the bank’s quarterly operating results showed strong growth because net interest income increased by Bt888 million, or 4 per cent. Its net interest margin was 3.41 per cent, although non-interest income decreased by Bt2.03 billion or 11.59 per cent, mostly on decreases in net income from insurance premiums and revenue from capital-market products.
KBank has set aside allowances for impairment loss on loans in line with economic circumstances. Its cost-to-income ratio was
39.44 per cent in the quarter.
Noriaki Goto, president and CEO of Bank of Ayudhya (Krungsri), believes the momentum of economic growth continued in the first quarter, and the bank expects it to gain further traction in the latter part of the year, supported by an acceleration in government spending, robust growth in the tourism sector, and improved exports.
Driven by improving agricultural prices and lower household leverages, an expansion in consumption is also expected. According to this outlook, the bank maintains its forecast of 3.3-per-cent growth in gross domestic product, which will contribute to broad-based loan growth in the range of 6-8 per cent for 2017.
Asia Plus Securities executive vice president Usanee Liurut said that although the financial results of the banking sector in the first quarter showed only slight growth, they demonstrated good signs for the second half of this year, especially the top three banks.
She said KBank looked like growing its net profit by at least 7 per cent this year even though its first-quarter profit growth was only 5.4 per cent.
She believes that Bangkok Bank’s net profit will grow by 7.8 per cent this year despite flat growth in the first quarter year on year. This forecast is based on expected new-loan growth of 4.9 per cent.
She also forecast that SCB’s net profit would grow by 7 per cent this year based on new-loan growth of 5 per cent. Its net profit grew by 13 per cent in the first quarter year on year.