Banks report varied Q1 net profits
The country's third-largest bank by assets, Siam Commercial Bank, saw growth in quarterly net profit shrink for the first time in several years as its bottom line was affected by the one-time expense of Bt1.5 billion to cover money embezzled from King Mon
SCB yesterday reported net profit for the first quarter of Bt13.15 billion, up by only 0.2 per cent year on year. If the embezzlement allowance of Bt1.5 billion were excluded, the growth figure would be 9.3 per cent, chief executive officer Arthid Nanthawithaya said.
In terms of the amount of net profit, however, SCB leads its peers.
SCB reported loan growth of 4.3 per cent in the quarter, largely in the wholesale banking and mortgage segments. SCB is the market leader in housing loans.
Net interest income grew by 6 per cent and non-interest income expanded by 4.4 per cent.
Non-performing loans (NPLs) climbed to 2.13 per cent of the total from 2.1 per cent at the end of last year, leading the bank to set aside Bt3.6 billion in impairment provisions for the first quarter, up by 12.3 per cent from the same quarter last year.
The fourth-largest bank, Kasikornbank, recorded net profit of Bt12.40 billion, up by 3.8 per cent from Bt11.94 billion in the first three months of 2014. KBank’s loans in the period increased by a slight 1.4 per cent from the end of last year and the NPL rate edged up to 2.26 per cent from 2.24 per cent.
Thanachart Bank and its subsidiaries were able to sustain their profitability in the first quarter even through lending dropped by 3.25 per cent from a decrease in the hire-purchase business.
The market leader in instalment lending yesterday reported net profit for the first quarter of Bt2.64 billion, unchanged from the same period last year, thanks to an increase in non-interest income and interest cost management.
Outstanding loans at the end of March were Bt731.73 billion, a decrease of 3.25 per cent from Bt754.37 billion at the end of last year. This was due to a decrease in instalment loans as a result of a slowdown in the automotive market.
However, the bank reported effective management of bad loans, with its gross NPL rate in the quarter improving to 3.95 per cent from 4.09 per cent at the end of last year.
Somjate Moosirilert, president and CEO of Thanachart Bank, said the recent policy-rate cut was expected to help widen the interest spread at his bank, which would show up in the next quarters. The bank’s interest spread by the end of the first quarter increased to 2.74 per cent from 2.58 per cent a year earlier.
The bank plans to bring its NPL rate this year below 3 per cent, and its coverage ratio will stay at 100 per cent, he said.
Kiatnakin Bank, another player in instalment lending, last Friday reported weak performance for the first quarter. Net profit dropped by 8 per cent year on year to Bt664 million, lending in the period decreased 1.9 per cent from the end of last year and NPLs increased to 6.5 per cent from 5.6 per cent end-2014.
