Tisco sure of im­prov­ing on 2016 re­sults

DE­SPITE SLUG­GISH LOAN GROWTH, GROUP SAYS IT IS ON TRACK TO DE­LIVER BET­TER NUM­BERS THIS YEAR THROUGH IM­PROVED MAN­AGE­MENT EF­FI­CIENCY

The Nation - - BUSINESS -

TISCO Fi­nan­cial Group ( Tisco) ex­pects to hit a new high this year after re­port­ing net profit of Bt4.5 bil­lion in the first nine months, group chief ex­ec­u­tive Suthas Rueng­mana­mongkol said.

The net profit of Bt4.5 bil­lion com­pared with last year’s net profit of Bt5 bil­lion, the im­prove­ment com­ing mainly due to man­age­ment ef­fi­ciency, he said.

De­spite nearly-flat loan growth, Tisco’s in­ter­est- based and non-in­ter­est-based in­come rose, he said.

In the fourth quar­ter of this year, Tisco will re­alise in­come from the trans­fer of re­tail bank­ing from Stan­dard Char­tered Bank (Thai) with a Bt36-bil­lion re­tail loan port­fo­lio.

Of the to­tal, about Bt24 bil­lion are res­i­den­tial loans, Bt5 bil­lion are per­sonal loans, Bt3.4 bil­lion are re­tail busi­ness loans, Bt3.3 bil­lion credit-card loans and Bt15 bil­lion de­posits.

After the trans­fer, Tisco’s loans will grow about 10 per cent this year, while non-per­form­ing loans (NPLs) will slightly in­crease, given SCBT’s slightly higher NPL.

Tisco’s non- per­form­ing loans will stay at 2.34 per cent of to­tal lend­ing and Stan­dard Char­tered’s at 3 per cent.

Once com­bined, Tisco’s NPL is es­ti­mated to in­crease to 2.4 per cent.

Tisco’s cov­er­age ra­tio is pro­jected to de­cline to 170-180 per cent from 185 per cent ear­lier.

“Although the over­all Thai econ­omy has im­proved, it is not suf­fi­cient to boost com­mer­cial banks’ loan growth.

No progress on NPLs

“The NPL sit­u­a­tion has not im­proved yet. NPLs are ex­pected to hit a record high in the third to fourth quar­ters of this year, from the ear­lier pro­jec­tion of the first to sec­ond quar­ters of this year,” Suthas said.

There­fore, banks will lend with cau­tion to main­tain loan qual­ity, while loans will not grow sharply, he said, adding “we may not see a dou­ble-digit growth”.

Mean­while, LH Fi­nan­cial Group re­ported a 4-per-cent drop year on year in its con­sol­i­dated net profit to Bt670.7 mil­lion in the third quar­ter of this year.

The bank’s nine- month net profit also de­clined 9.6 per cent year on year to Bt1.8 bil­lion fol­low­ing a 35.5-per-cent fall in its non-in­ter­est in­come.

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