Bangkok--21 Jan--Siam Commercial Bank
Siam Commercial Bank announced its unaudited 2012 results and reported a net profit of Baht 40.2 billion, a 28.9% increase year-on-year. This announcement reflects the underlying strength of SCB’s banking franchise. The increase in net profit was attributed to robust loan growth of 19.7% in 2012 resulting in higher growth in net interest income, an increase in net insurance premium, and higher net trading and FX income. Despite the continued improvement in loan quality, the Bank set aside additional prudential provision of about Baht 4 billion for future uncertainties.
Commenting on the record results, Dr Vichit Suraphongchai, Chairman of SCB’s Executive Committee, notes that “the results reaffirm the strength of SCB’s universal banking franchise together with the talent and spirit of its staff and the increasing loyalty of its growing customer base. Importantly, the Bank stands well positioned to face the competitive challenges that lie ahead in the volatile global macro-economic environment, competitive domestic landscape and the emergence of the AEC in the near future”.
Net interest income increased by 22.9% over 2011 primarily as a result of the robust loan growth of 19.7% year-on-year and a larger component of higher yield loans. Although the cost of deposits increased in a very competitive marketplace the Bank was able to maintain its NIM at 3.18%., Much of the above-market loan growth was in the automobile (45.9%), housing (21.3%) and SME segments (25.5%).
Non-interest income increased 15.3% year-on-year as a result of solid growth in net fee and net insurance premium income and higher net trading and FX income. Of note was the significant growth in insurance premium resulting from meaningful market share gains.
During the year, the Bank set aside prudential provisions as a cushion for future uncertainties, in aggregate about Baht 4 billion. At the same time, the NPL level continued to decline and reached a new post-Asian economic crisis low of 2.13% at the end of 2012 from 2.61% at the end of 2011. As a result of higher provisions and declining NPLs the coverage level for NPLs has increased from 127.1% at the end of 2011 to 144.8% at the end of December 2012.
Khun Kannikar Chalitaporn, President the Bank, commented that the “2012 results not only manifest record net profits, high growth and better loan quality but also the competitive edge of the Bank — competitive and innovative products with quality services to provide a compelling value proposition to a broad range of customers. Ultimately, the results underscore the collective efforts of our employees to make SCB the ‘Bank of Choice’ in Thailand for all its stakeholders”.