SIAM Commercial Bank Plc (SCB), Bank of Ayudhya Plc (Krungsri) and CIMB Thai Bank Plc have enjoyed healthy revenue growth in the first half of this year, thanks to the country’s improving economy.
SCB and its subsidiaries announced total operating income of Bt34.3 billion in the second quarter of 2018, a 1.1 per cent year-on-year increase on the back of net interest income growth of 4.7 per cent year on year, despite pressure from lower non-interest income. However, investments in new technology platforms as part of the group’s Transformation Programme and digital acquisition activities led to a rise in operating expenses and a decline in net profit to Bt11.1 billion - down 6.7 per cent year on year for the quarter. The figures are based on the company’s unaudited consolidated financial statements.
For the first half, SCB’s total revenue was Bt69.72 billion, up 3.8 per cent from the same period of last year. Net profit stood at Bt 22.5 billion, dropping 5.7 per cent from the same period of last year, the bank’s president and CEO Arthid Nanthawithaya said yesterday.
SCB’s smaller rival Krungsri announced it booked interest revenue of Bt36.51 billion for the six months, up 9.24 per cent from the same period of last year. Income from fees and services came to Bt10.5 billion, up 12.9 per cent. Those figures helped the bank to record net profit of Bt12.5 billion, a rise of 8.4 per cent from the same period of last year
Krungsri president and chief executive officer Noriaki Goto described the bank’s overall financial results for the half year as quite satisfactory. He noted the strong performance, particularly in loans, net interest income, non-interest income and coverage ratio. The bank posted 5.9 per cent loan growth in the first half, reflecting improved economic conditions.
“The bank’s coverage ratio improved to 161.7 per cent, while our asset quality remains strong with a non-performing loans (NPL) ratio of 2.02 per cent,” Goto said. “The solid performance reflects our competitive strength and prudent business execution capacities.
"As for the outlook for the remainder of the year, we expect the Thai economy to continue expanding and achieve a higher growth than the earlier forecast, with GDP growth forecast for 2018 at 4.7 per cent, up from 4 per cent. Barring further escalation in US-China trade disputes, the revision was on account of merchandise exports and tourism, which continue to improve in line with the global economic expansion, and increased domestic demand momentum.
“This contributed to a more favourable operating environment. Krungsri expects the full-year loan growth performance to outpace our prior guidance and to be in the range of 8-10 per cent.”
As of 30 June, Krungsri - Thailand's fifth-largest bank in terms of assets, loans and deposits, and one of the five domestic systemically important banks (D-SIBs) - reported Bt1.64 trillion in loans, Bt1.37 trillion in deposits, and Bt2.1 trillion in total assets. The bank's capital was strong at Bt223.2 billion, equivalent to 14.95 per cent of risk-weighted assets, with 11.28 per cent in common equity tier-1 capital.
Meanwhile, CIMB Thai Bank Plc reported consolidated unaudited financial results for the first half of this year.
Its consolidated operating income rose by Bt412.2 million, up 6.5 per cent year on year, to Bt6.79 billion from the first half of last year. The main contributors were a 5.2 per cent growth in net interest income, a 10 per cent growth in net fee and service income and 12.6 per cent growth in other income.
However, the bank’s pre-provision operating profit decreased 1.4 per cent year on year to Bt2.92 billion, attributed to a 13.3 per cent year on year increase in operating expenses. Net profit fell by Bt117.7 million, or 24.6 per cent year on year to Bt360.1 million, due to higher operating expenses coupled with a 1 per cent increase in provisions, said CIMB Thai Bank Plc president and chief executive officer Kittiphun Anutarasoti.