Bangkok--20 Oct--TMB
- Core business profit improves
- NPL ratio declines to 9.5%
- Customer-centric policy yielding benefits for customers and the Bank
TMB and its subsidiaries today reported a net profit of THB777 million for 3Q 2010. The results reflect TMB’s progress in implementing its strategy to become the leading Thai bank with world-class financial solutions.
TMB is undergoing a transformation divided into three phases: Laying the Foundation, Quality Growth and Market Leadership. The “Laying the Foundation” phase took place from 2008 to 2009. This year, TMB is in the “Quality Growth” phase, building up a high-quality customer base while strengthening its business in areas such as lending and deposits.
TMB’s net profit of THB777 million for 3Q 2010 is an increase of 48% compared to 3Q 2009. TMB’s core operation lines improved when compared to 3Q 2009 and 2Q 2010. This confirms the effectiveness of the Bank’s Quality Growth phase. Net interest margin increased to 2.39% in 3Q 2010, compared to 2.25% for 2Q 2010 and 2.32% for 3Q 2009. Key recurring non-interest income, which is gains on exchange and fee income, rose by 6% compared to 2Q 2010 and 10% compared to 3Q 2009.
TMB’s gross loans during 3Q 2010 grew by 1.4% from the end of 2Q 2010. Excluding non-performing loans (NPLs), which decreased by 6.3%, performing loans on a Bank-only basis rose by 2.5%. This growth was driven by corporate loans, which increased by THB6 billion, or 3.6% from 2Q 2010; as well as SME loans, which increased by THB1 billion, or 1.3% from the 2Q 2010. NPLs and foreclosed properties both continued to decline. On a Bank-only basis, NPLs for the 3Q 2010 dropped by 6.3% compared to 2Q 2010, or almost THB2.5 billion, to THB39 billion. This represents an NPL ratio of 9.5%, which is in line with the bank’s target. Foreclosed properties also declined almost THB1.2 billion, or around 13%, to THB7 billion.
The Bank’s deposit grew by THB12.5 billion or 3.2% compared to the 2Q 2010 due to the “Up and Up” and “Quick Interest” term deposit products drive as part of the Bank strategic customer value proposition in line with its customer-centric policy.
As of 3Q 2010, The Bank’s balance sheet remains liquid with cash, interbank and short-term investment, representing 24% of the total earning assets. The Bank’s loan to deposit ratio (LDR) was 87%. With the inclusion of short-term borrowings, the LDR ratio is 84%, remaining a comfortable level. The Bank’s capital position is solid with the capital adequacy ratio (CAR) of 17.8% of which 12.3% is Tier 1. The ratio is above the minimum requirement by the Bank of Thailand of 8.5% for CAR and 4.25% for Tier 1.
Commenting on the performance, Mr. Boontuck Wungcharoen, TMB CEO, said, “The 3Q 2010 results are the outcome of our customer-centric policy and strategic plan implementation with a vision to develop TMB to be the leading Thai bank with world-class financial solutions. We have come a long way in building a stronger and healthy bank, achieving the foundation laying phase for quality and sustainable growth while TMB’s innovative financial products and solutions have also begun to yield benefits for customers and the Bank.
“In the last quarter of 2010 and the next few years, TMB will continue to focus on being a close banking partner for retail, SME and large corporate customers and support them to achieve their financial goals with our unique customer value propositions which do not only differentiate us from the market, but also provide customers in all segments with what they have been looking for but never been fulfilled before.”