Kasikorn Leasing's earnings in the first six months soared by 42.68 per cent to Bt224 million year on year, thanks to domestic auto sales.
Economic recovery has driven the automobile market, with vehicle sales in the first six months 54.1 per cent higher than in the same period last year.
This outstanding growth is reflected in KLeasing having generated hirepurchase loans of Bt13.51 billion in the period, managing director Isara Wongrung said yesterday.
Car-dealer loans totalled Bt6.16 billion, 33.5 per cent above target because dealers have increased stocks to cope with increased demand. As a result, overall lending at KLeasing in the first half was Bt19.67 billion, 9.88 per cent higher than expected and up 33.5 per cent year on year.
Meanwhile, KLeasing's nonperforming loans (NPLs) at the end of June stood at 1.43 per cent, 2.25 percentage points lower than expected.
Outstanding loans stood at Bt49.05 billion, up 27.5 per cent year on year.
The company plans to provide additional loans of Bt16.793 billion in the second half of the year, following a report by Kasikorn Research Centre in which it said fullyear auto sales were expected to come in at between 700,000 and 730,000 units, up by 2833 per cent from last year's level.
The newloan target for the current half comprises auto finance at Bt7.66 billion, KCar to Cash (Bt2.68 billion), auto leasing (Bt2.05 billion) and KDealer Floor Plan (Bt4.39 billion).
Isara said the company expects outstanding lending at yearend will stand at Bt52.09 billion, up 20 per cent from last year. The number of hirepurchase accounts will not be lower than 145,000, he added.
KLeasing forecasts earnings in the second half will reach Bt176 million, and that NPLs will be no more than 2.23 per cent of overall lending.
He said its hirepurchase interest rate might rise slightly to 2.652.75 per cent over the rest of the year, from the current 2.45 per cent. The rate increased from 2.35 per cent early this year in line with monetarypolicy changes.
However, whether the rate is increased further depends on the Monetary Policy Committee of the Bank of Thailand and competition in the hirepurchase market, he added.
While the GDP will expand 77.5 per cent, next year's growth rate could be only 23 per cent. This would cause the leasing business to post lower growth than this year.