Kasikornbank revealed that in Q3/2024, it had a net profit of 11,965 million baht, a decrease of 5.43% compared to the previous quarter due to a decrease in non-interest income and an increase in fee and service income, resulting in a net profit of 38 billion baht in the first 9 months of 2024.
Ms. Kattiya Indaravijaya, Chief Executive Officer of Kasikornbank, revealed that Thailand’s economic activities in the third quarter of 2024 still have an incomplete recovery, especially industrial production, which is facing structural problems, and private sector spending, both in terms of investment and household consumption, which are pressured by costs, debt burdens, and income flows that have not returned to normal. For the rest of 2024, although the Thai economy should be able to maintain its growth trend, the impacts from the flood situation and the volatility of the baht, as well as the slowdown of major global economies, geopolitical conflicts, and signs of slow recovery in domestic spending, which will rem
ain risks to the Thai economy in the future, amidst various challenging factors, Kasikornbank continues to focus on moving forward with the 3+1 strategy to deliver sustainable value to all stakeholders in the context of an uncertain economy.
In the third quarter of 2024, the Bank and its subsidiaries had a net profit of 11,965 million baht, a decrease of 688 million baht or 5.43% compared to the previous quarter, mainly due to a decrease in non-interest income, mainly from the insurance business. However, net fee and service income increased, partly from fees received from international trade services and brokerage fees from securities trading, together with a slight decrease in net interest income compared to the previous quarter due to the overall economy that is still not recovering universally and the Bank has upgraded the process to increase the efficiency of new quality lending. The net interest margin (NIM) was 3.61%, a decrease compared to the previous quarter, resulting from the increase in net inte
rest assets from transactions related to the management of a fund, which had only a short-term impact on the Bank. However, excluding such items, the net interest margin (NIM) would be at a level close to the previous quarter.
Meanwhile, other operating expenses amounted to THB 21,501 million, slightly decreased from the previous quarter as the Bank continued to manage expenses and improve operational efficiency. Expected credit loss (ECL) provisions amounted to THB 11,652 million, close to the previous quarter, in line with the principle of continuous prudence in order to maintain provisions at an appropriate level, reflecting the current situation and supporting the uncertainty of various factors, including the volatility of the global economy, which may affect the economy.
For the 9-month period of 2024, the Bank and its subsidiaries had operating profit before expected credit losses and income tax of 85,159 million baht, an increase of 3,861 million baht or 4.75%, resulting from net operating income gro
wing by 7,501 million baht or 5.29%, higher than other operating expenses, which increased by 3,640 million baht or 6.02%, in line with the expansion of business volume. Although the provision for expected credit losses (ECL) decreased compared to the same period of the previous year, the Bank and its subsidiaries continued to set aside provisions based on the principle of prudence to accommodate the uncertainty of various factors that may affect the economic situation. Therefore, the provision for the third quarter of 2024 was set aside at 11,652 million baht, close to the previous quarter, resulting in net profit of 38,104 million baht, an increase of 5,087 million baht or 15.41% from the same period of the previous year.
Net operating income was 149,260 million baht, an increase of 7,501 million baht or 5.29%, mainly from net interest income of 113,031 million baht, an increase of 3,436 million baht or 3.14%, in line with market conditions. In the past, the Bank has implemented various measures, including
reducing interest rates on loans, to provide assistance to vulnerable customers and customers affected by floods in many areas to alleviate their suffering and enable them to recover more quickly.
Net interest margin (NIM) was 3.66%. Net fee and service income amounted to 24,809 million baht, an increase of 1,178 million baht or 4.98%, mainly from fees received from wealth management through the offering of comprehensive financial products of the Bank and its subsidiaries, including partners, and fees received from credit services. In addition, there was an increase in profit from financial instruments measured at fair value through profit or loss, and investment income, including foreign exchange income, in line with the recovery of tourism, resulting in non-interest income of 36,229 million baht, an increase of 4,065 million baht or 12.64%, while other operating expenses amounted to 64,101 million baht, an increase of 3,640 million baht or 6.02% from employee expenses, technology expenses to support the ex
pansion of customer service channels, and marketing expenses in line with the increase in income in line with the expansion of business volume. The Bank and its subsidiaries continue to focus on cost management to create value and continuously increase operational efficiency. This resulted in the ratio of other operating expenses to net operating income (Cost to income ratio) being at 42.95%, close to the same period of the previous year.
As of September 30, 2024, the Bank and its subsidiaries had total assets of 4,367,025 million baht, an increase of 83,469 million baht or 1.95% from the end of 2023, mainly from interbank and money market items. Assets amounted to 663,457 million baht, an increase of 94,449 million baht or 16.60% from the Bank’s liquidity management.
However, net loans amounted to 2,321,531 million baht, a decrease of 49,961 million baht or 2.11% due to the economy that has not fully recovered, coupled with the improvement of the process to increase the efficiency of new quality lending, r
eflecting the management of the balance of risk and return at an appropriate level. In addition, in order to be in line with the Bank’s policy of managing asset quality with maximum efficiency with caution, for some unsecured business loans that have ceased operations, the Bank has a plan to sell them in the future and transfer them to financial assets measured at fair value through profit or loss, including a plan for the Bank’s subsidiaries to establish a joint venture with Bangkok Commercial Asset Management Public Company Limited (BAM) with the objective of managing non-performing assets as previously notified to the Stock Exchange of Thailand.
For deposits, there was 2,770,120 million baht, an increase of 70,558 million baht or 2.61%, resulting in a loan-to-deposit ratio of 87.85%. However, if excluding the short-term increase in deposits, the loan-to-deposit ratio would be at a level close to the previous quarter. As for non-performing loans to loans (%NPL gross), it was at 3.20%, a slight increase fro
m the previous quarter.
However, the Bank continues to closely monitor the quality of its loans from the flood situation and considers setting aside sufficient provisions based on prudent principles, resulting in a ratio of expected credit losses to non-performing loans (Coverage ratio) of 150.72%. The ratio of total capital to risk-weighted assets of the Kasikornbank Financial Group under the Basel III criteria as of September 30, 2024 remains strong at 20.58%.
Source: Thai News Agency