Seven SET-listed banks reported combined earnings growth of 20% in the third quarter, thanks largely to healthy loan business and strong fee and service income.
Their accumulated net profit for the three months ending September totalled 41.17 billion baht, up from 33.42 billion in the same period last year, according to a filing to the Stock Exchange of Thailand (SET).
Since the quarterly earnings season started last week, seven of the 11 banks listed on the SET have released their earnings. They were Bangkok Bank (BBL), Siam Commercial Bank (SCB), Kasikornbank (KBANK), Bank of Ayudhya (BAY), TMB Bank (TMB), Tisco Financial Group (TISCO) and Kiatnakin Bank (KKP).
Even though domestic consumption and private investment remained sluggish, lending expanded at a fast clip.
TMB was the best performer in terms of percentage growth. The seventh-largest lender by assets saw its quarterly net profit shoot up 67.09% to about 1.87 billion baht.
The sharp increase was driven by a 17.3% increase in net interest income and a 4.5% rise in non-interest income. However, the bank set aside loan-loss provisions in the third quarter amounting to about 1.2 billion baht, the same level as in the same corresponding period last year but far below the 3.57 billion baht in the previous quarter.
BAY showed the lowest percentage growth in earnings among its industry peers for the three-month period. Its quarterly net profit rose by a mere 1.39% to 3.79 billion baht as higher loan-loss provisions almost wiped out increases in net interest and fee and service income.
Thailand's fifth-largest bank by assets set aside 3.15 billion baht for loan-loss provisions, up 13.1% from the same period last year but down 46.7% from the previous quarter.
Its net interest income surged 10% over the same period a year earlier to 11.25 billion baht, while its net fee and service income expanded 11.2% to 3.59 billion baht.
BAY's net interest margin (NIM) was maintained at 4.32% for the third quarter.
Its lending at the end of September grew 7.1% from the end of last year, thanks to robust 12% growth in retail loans, 3.6% SME loan expansion and a 1.3% rise in corporate loans.
Its non-performing loans (NPLs) at the end of September stood at 2.6% of its total loans.
In terms of amount, SCB reported the largest earnings. The bank's third-quarter net profit stood at 12.72 billion baht, up 26.4% from 10.07 billion baht over the same period a year earlier.
The country's third-biggest bank by assets saw its interest income rise at an annual rate of 16.5% to 18.86 billion, while non-interest income jumped 34.6% to 13.36 billion baht.
Higher NIM also gave a boost to the bank's bottom line. Its NIM increased to 3.24% in the third quarter from 3.23% in the previous three months.
During the three months ended September, SCB still aggressively set aside loan-loss provisions of 4.19 billion baht, compared with 2.03 billion baht in the same period last year and 2.69 billion baht in the previous quarter.
Its loan-loss coverage then increased to 151.5% from 134.9% in the same period a year ago.
Its loans grew 12.7% year on year, boosted by 21.5% growth in SME loans, an 18.2% increase in retail loans and 2.7% expansion in corporate loans.
The bank's bad credit at the end of September rose slightly to 2.08% from 2.07% in the previous quarter, but fell from 2.13% in the same period a year before.
The banking sector index yesterday advanced 10.01 points or 1.86% to 549.39 in trade worth 8.33 billion baht.