Eleven banks hit by net profit slip

Eleven SET-listed commercial banks saw their aggregate net profit for the second quarter fall by 8.9% as higher impairment charges for loan-loss provision eroded earnings.

The banks’ combined net profit for the three months to June was 47.4 billion baht, compared with 52 billion in the same period a year earlier, according to financial statements.

State-owned Krungthai Bank (KTB) was the worst performer for the April-to-June quarter. Its unreviewed consolidated net profit plunged 62.9% year-on-year to 3.22 billion baht as reserves set aside to cover bad loans jumped 79.3% year-on-year and 86% quarter-to-quarter, reaching 13.9 billion.

KTB’s consolidated non-performing loans (NPLs) surged by 7.95 billion baht or 8.7% from the end of last year to 99.1 billion at the end of June.

The bank’s gross NPL ratio also rose to 4.33% at the end of June from 3.97% at the end of 2016. Coverage ratio fell to 113% of bad loans at the end of the second quarter from 122% six months ago.

LH Financial Group, the parent of Land and Houses Bank, was the second-worst performer in the second quarter, with a slump in net profit of 23.1% year-on-year.

The group’s NPL ratio climbed to 2.01% at the end of June from 1.76% at the end of 2016.

Kiatnakin Bank (KKP) posted a decline in second-quarter net profit of 8.6% year-on-year, while loan-loss reserves set aside for the period plunged by 26.3% amid a rise in loan delinquency.

The small bank delivered a net profit of 1.19 billion baht for the three months to June, compared with 1.3 billion over the same period last year, it said in a statement.

Its net interest income increased by 4.5% on year to 2.65 billion baht during the second quarter, and the bank’s net fee and service income also rose by 2.9% over the same period last year to 931 million.

Its impairment charge dropped by 26.3% over the corresponding period a year ago to 456 million baht during the second quarter.

The bank’s NPL ratio rose to 5.8% at the end of June from 5.6% at the end of last year.

Siam Commercial Bank (SCB) reported a net profit of 11.9 billion baht for the three months to June, down 7.1% from a year earlier.

The country’s third-largest lender by assets set aside 5.01 billion baht loan loss reserves, down 41.1% over the same period last year, however.

NPL ratio improved to 2.65%, SCB said in a release that didn’t provide a comparative figure.