CIMB Thai profit rises to 367.2m baht
KUALA LUMPUR: CIMB Thai Bank Plc, a subsidiary of CIMB Group Holdings Bhd, registered a 5.5 per cent increase in net profit to 367.2 million baht (RM42.6 million) in the six months ending June 30, from 348.1 million baht in the same period last year.
CIMB Thai president and chief executive officer Subhak Siwaraksa said the increase in net profit was due to the improved operating income and better cost management, partially offset by a 17 per cent yearon-year increase in provisions, in line with the slower economic recovery.
The bank’s consolidated operating income rose 6.7 per cent to 6.49 billion baht in the six months of this year, from 6.08 billion baht recorded in the same period last year.
The increase was underpinned by a 23.2 per cent growth in net interest income and offset by a three per cent and 35.8 per cent reduction in net fee and service income and other income, respectively, said Subhak in a statement yesterday.
The net interest income increase was mainly attributed to loan expansion and lower interest expenses while net fee and service income decreased by 22.9 million baht, or three per cent, due to lower loan syndication and loan-related fees.
Other operating income, however, decreased by 486.1 million baht, or 35.8 per cent, due to softer treasury businesses, partially moderated by higher gains on investment and other operating income.
CIMB Thai said its operating expenses grew slightly by 0.2 per cent due to higher employee expenses, partially offset by a decrease in premises and equipment expenses and taxes and duties.
“As a result of better cost management and increased income, the cost-to-income ratio decreased to 53.8 per cent in the six-month period compared with 57.3 per cent recorded last year,” it said.
Net interest margin over earning assets stood at 3.79 per cent in the period, compared with 3.05 per cent last year as a result of more efficient funding cost management, it said.
CIMB Thai said as at June 30, total gross loans stood at 202.5 billion baht, marking an increase of 1.8 per cent from December 31 last year.
Gross non-performing loans (NPLs) during the same period stood at 8.8 billion baht, with an equivalent gross NPL ratio of 4.3 per cent.
“This is an increase from 3.1 per cent as at December 31, mainly arising from the slower repayment ability from a few corporate and small and medium enterprise accounts, given the softer economic environment,” it said.