KTC focusing on luring 'quality' cardholders

Krungthai Card, the credit-card subsidiary of Krungthai Bank, is focusing more on quality cardholders who spend regularly, while mounting attractive campaigns for personal-loan customers who have the discipline to repay their debt.

Rathian Srimongkol, chief executive officer of KTC, said the overall credit-card and personal-loan business did better last year than in 2011. The total number of credit cards in the industry rose by 10.1 per cent to 16.9 million, while outstanding debt in this category rose by 14.3 per cent to Bt261.55 billion. In the personal-loan category, last year saw outstanding lending of Bt251.55 billion, up by 18 per cent, he said.

As the Thai economy is expected to continue to blossom this year, domestic spending should also keep growing, while export will resume its role as an economic driver.

The higher minimum wage has a positive effect on purchasing power, meaning good prospects for consumer lending, Rathian said.

KTC yesterday reported net profit of Bt255 million in 2012 against a net loss of Bt1.62 billion in 2011. Revenue was Bt12.62 billion, up from Bt12.50 billion in 2011. Interest income was Bt7.95 billion or 63 per cent of the total, followed by fee income of Bt3.27 billion.

Non-performing loans and doubtful accounts dropped to Bt3.47 billion from Bt5.61 billion in 2011.

As of the end of last year, KTC had total assets of Bt49.14 billion, while the loan portfolio was increased by 4 per cent from 2011 to Bt44.55 billion. The customer base totalled 2.16 million accounts, consisting of 1.53 million credit cards with outstanding debt of Bt30.1 billion and KTC Cash personal loan of Bt12.18 billion from 626,326 accounts.

Rathian attributed last year's financial performance mainly to debt collection, service-centre improvements and aggressive marketing activities.

Net interest margin, however, declined to 13.2 per cent from 13.6 per cent because of the low rate of return from credit-card business, he said. Even though outstanding loans increased, more customers paid back the full amount than those who paid the minimum amount.