Thanachart Thai Military Bank Reports Strong Profit Growth in Third Quarter
TMB Thanachart (TTB) sees profit rise by 27.5% to 4.735 billion baht in Q3 2023, primarily due to increased interest income.
TMB Thanachart (TTB) has announced its 3rd quarter financial results, reporting a significant profit growth of 27.5% compared to the same period last year. The bank’s net profit reached 4.735 billion baht, attributed to higher interest income. TTB has also set aside additional reserves of 4.354 billion baht and expects the Thai economy to recover in the final quarter of 2023, with an anticipated 27.5 million foreign tourists visiting the country this year.
TTB aims to achieve a 3% loan growth this year and ensure that non-performing loans (NPLs) do not exceed 2.9%. The bank is also striving to establish itself as one of the top three mobile banking providers in Thailand.
The bank’s net profit for the second quarter of 2023 stood at 4.56 billion baht, marking a 33% increase driven by rising interest rates.
TTB Unveils Operating Results for Q3 2023
Operating income of 18 billion baht, reflecting a 10.1% YoY increase
On October 19, 2023, TTB released its operating results for the 3rd quarter of 2023. The bank achieved an operating income of 18 billion baht, indicating a growth of 10.1% compared to the same period last year. Moreover, TTB recorded a net profit of 4.735 billion baht, representing a substantial 27.5% increase YoY. The primary driver of this growth was the surge in interest income, resulting from the upward trend in bond yields and policy interest rates.
For the first nine months of 2023, TTB’s net profit amounted to 13.596 billion baht, indicating a remarkable 31% increase compared to the same period in the previous year.
The bank’s net interest income for the quarter stood at 14.665 billion baht, reflecting a noteworthy 13.1% YoY growth. However, non-interest income declined by 1.4% YoY to 3.335 billion baht.
TTB’s provisions for expected credit losses (ECL) in the quarter amounted to 4.354 billion baht, a minimal 0.2% decrease compared to the same period last year. The total provisions throughout the first nine months of 2023 reached 12.874 billion baht.
As of September, non-performing loans (NPLs) excluding accrued interest stood at 40.279 billion baht, a decrease from 40.719 billion baht in June 2023. The NPL ratio remained at 2.67%, slightly higher than the 2.63% recorded in June. However, the provision ratio for non-performing loans stood impressively high at 144%.
TTB’s CEO Optimistic about 3rd Quarter Performance
Mr. Piti Tantakasem, CEO of TTB, expressed satisfaction with the bank’s operating results for the 3rd quarter of 2023, highlighting their achievement of set goals across various aspects. These achievements include income control, operating cost management, and asset quality maintenance. Consequently, TTB garnered substantial profits, enhancing its financial position.
Navigating Economic Fluctuations with Prudent Loan Growth
Amidst the unpredictable economic climate, both domestic and international, TTB continues to exercise caution in its new loan growth strategy. The bank recognizes that rapid credit expansion under unfavorable conditions could lead to increased bad debts and provisioning burdens. To ensure customer satisfaction, TTB plans to gradually raise loan interest rates while capitalizing on available funds and liquidity to benefit from the current upward trend in interest rates. Effective financial cost management remains a priority for TTB.
Economic Outlook for Q4 2023
Tourism recovery and weakened private investment expected
TTB predicts an improved economic outlook for the fourth quarter of 2023. The bank expects the overall economy of Thailand to experience a better recovery trend, driven in part by an estimated 27.5 million foreign tourists visiting the country this year. The tourist season and visa fee waivers for major tourist groups are anticipated to boost tourism numbers, particularly in the last quarter.
However, TTB anticipates a slowdown in private investment due to weakening domestic demand and uncertainties surrounding government investment stimulation policies.
TTB analytics forecast a 2.8% expansion of the Thai economy in 2023, with the possibility of downgrading the forecast if foreign demand and private consumption decelerate significantly.
The Monetary Policy Committee (MPC) is expected to maintain the interest rate at 2.50% in the financial market, deeming it appropriate for stable long-term economic growth. Future adjustments to the interest rate will be made in accordance with economic trends and inflation.
The baht is projected to strengthen slightly in the fourth quarter of 2023, anticipated to trade within the range of 35.50-36.50 baht per US dollar by the end of the quarter.
For full details, please refer to the official statement on the Explanation and Analysis of Operating Results for the 3rd Quarter and 9-month Period Ending on September 30, 2023.
Thanachart Thai Military Bank or TMB Thanachart (TTB) shows 3rd quarter 2023 profit growing 27.5% at 4,735 million baht from higher interest income. Ready to set additional reserves of 4,354 million baht, assessing the Thai economy to recover in the last quarter of 2023 from foreign tourists expected to reach 27.5 million this year.
TTB expects loan growth this year of 3%, NPL no more than 2.9%, aiming to push mobile banking into the top 3 in Thailand.
TTB net profit of 4.56 billion in the 2nd quarter, up 33% from rising interest rates.
On October 19, 2023, Thanachart Military Bank Public Company Limited or TTB announced operating results for the 3rd quarter of 2023 with an operating income of 18,000 million baht, an increase of 10.1% compared to the same period of the previous year and was it had a net profit of 4,735 million baht, an increase of 27.5% compared to the same period last year. The main factor is an increase in interest income. Following the upward trend in bond yields and policy interest rates.
As a result, for the first 9 months of 2023, there was a net profit of 13,596 million baht, an increase of 31% compared to the same period last year.
The bank had net interest income of 14,665 million baht, an increase of 13.1% compared to the same period last year. And non-interest income was 3,335 million baht, a decrease of 1.4% compared to the same period last year.
While in this quarter expected credit losses (ECL) or provisions of 4,354 million baht decreased by 0.2% compared to the same period last year. Total for the first 9 months of 2023 was 12,874 million baht.
For non-performing loans (NPLs), excluding accrued interest at the end of September, it was 40,279 million baht, down from 40,719 million baht at the end of June 2023, and the non-performing loan ratio (NPLratio ) at 100%. 2.67 compared to 2.63 per cent at the end of June 2023, while the provision ratio for non-performing loans remains at a high level (coverage ratio) at 144%
Mr. Piti Tantakasem, CEO of TTB, revealed that the operating results of the 3rd quarter of 2023 still have a good trend from the first 2 quarters, a total of 9 months. The bank is considered to have achieved its goals in all aspects. Be it income Control operating costs and look after the quality of assets This leads to good profits and a stronger financial position.
However, under the economic situation that still faces fluctuations from inside and outside the country. The bank continues its policy of cautious new loan growth. This is because it is considered that accelerating credit growth in this unfavorable environment could cause bad debts and provisioning burdens, etc. follow later At the same time, the bank still plans to gradually increase loan interest rates to take care of customers. Therefore, generating income and earnings from interest focuses on using available funds and liquidity to benefit from the upward trend in interest rates. along with effective financial cost management
TTB assesses the economic outlook for the 4th quarter of 2023 that the overall economy of Thailand has a better recovery trend. The number of foreign tourists entering Thailand this year is expected to be 27.5 million and is likely to accelerate in the last quarter of the year. Part of this comes from access to Thailand’s tourist season and measures to waive (visa-free) visa fees for major groups of tourists.
As for private investment, it is likely to slow down due to weakening domestic demand. as well as the uncertainty of the government’s investment stimulation policies.
In this regard, ttb analytics estimates that in 2023 the Thai economy will expand by 2.8 percent and there is a possibility of downgrading the forecast if foreign demand and private consumption clearly slow down.
While in the financial market the MPC is likely to maintain the interest rate at 2.50 percent, evaluating that the current interest rate is at an appropriate level for stable economic growth in the long term. And in the future, consideration will be given to suit the economic trends and inflation.
As for the value of the baht in the 4th quarter of 2023, it is expected to strengthen somewhat. It will be in the range of 35.50-36.50 baht per US dollar at the end of the quarter.
Read full details at: Explanation and analysis of operating results for the 3rd quarter and 9 month period ending 30 September 2023
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