TMB Bank zeroes in on mid-sized firms

TMB Bank will continue to focus on mid-sized companies with the aim of improving its corporate banking yields amid intense competition.

The bank aims to keep interest and fee-based income growth rates for the segment at 27% and 20% respectively in the second half after booking those rates in the first six months of the year, said Piti Tantakasem, TMB’s chief wholesale banking officer.

The spread between deposit and loan rates widened to 2.99% in the second quarter of the year from 2.68% in the same period a year earlier. The country’s sixth-biggest lender by assets said the improved spread is partly the result of corporate loan restructuring to concentrate on the high-yield segment, especially small and mid-sized firms with annual revenue below 500 million baht.

The bank has reduced loans to state enterprises because of their large size and narrow margins, said Mr Piti.

‘‘We have shifted our focus to small loans with credit lines of hundreds of millions of baht, due to better yields instead of larger companies with multibillion-baht credit lines,’’ he said.

Corporate loans dominate the bank’s portfolio, at 47% of outstanding credit.

In the first six months of the year, TMB recorded flat growth in corporate lending with total loans of 200 billion baht, with 70-80% for working capital.

As the country’s business trends are in four key areas — infrastructure, urbanisation, digital TV and border trade — TMB has greater opportunities to grow its customer base and loans.

It posted a 15.9% year-on-year increase in first-half net profit to 2.07 billion baht.

Shares of TMB closed on the Stock Exchange of Thailand at 2.40 baht yesterday, down four satang, in trade worth 559.57 million baht.