Bangkok--18 Apr--CIMB Thai Bank
CIMB Thai Bank posts 1Q2014 net profit of THB 440.7 million, a YoY surge of 40.8%, mainly from income growth of 36.7%, mainly from net interest income, trading and FX & Derivatives
Mr. Subhak Siwaraksa, President and Chief Executive Officer, CIMB Thai Bank PCL stated that for the three months ended 31 March 2014, CIMB Thai group recorded a consolidated net profit of THB 440.7 million, a year-on-year (“YoY”) increase of THB 127.7 million or 40.8% from 3M2013. The increase in income was mainly attributed to a growth in other income, net interest income and net fee and service income of 106.0%, 27.1%, and 23.1% respectively. Operating expenses grew at 21.4% whilst there was a 120.2% YoY increase in provisions. The higher provisions are reflective of a more prudent impairment stance in light of possible negative changes in the economic environment. The provisions were THB 2.6 billion in excess of the Bank of Thailand’s reserve requirements.
On a YoY basis, CIMB Thai group’s consolidated operating income rose by THB 724.6 million, or 36.7% to THB 2,698.2 million from 3M2013. Net interest income increased by THB 395.1 million or 27.1% YoY, largely underlined by early redemption of hybrid instruments and strong loan expansion. Net fee and service income increased by THB 60.0 million or 23.1%, mainly due to improvements in advisory fees and security issuer fees. Meanwhile, there was an increase of THB 269.6 million or 106.0% in other income, mainly from Treasury Business.
Operating expenses grew by THB 295.9 million or 21.4%, mainly from employee expenses and other operating expenses resulting from business growth momentum. The cost to income ratio decreased to 62.2% in 3M2014 compared to 70.0% in 3M2013 as a result of improved income and better cost management.
Amidst intense competition in both deposit and lending markets, CIMB Thai group’s Net Interest Margin (NIM) over interest earning assets increased by 9bps to 3.27% in 3M2014 from 3.18% in 3M2013 on the back of better controls on the cost of funds.
As at 31 March 2014, total gross loans stood at THB 171.9 billion, marking a 0.4% increase from 31 December 2013. In addition, Deposits, Bill of Exchanges and Debentures stood at THB 185.9 billion, a decrease of 0.4% from THB 186.7 billion at the end of December 2013. As a result, the Loan to Deposit Ratio (including Bill of Exchanges and Debentures) stood at 92.4% from 91.6% as at 31 December 2013.
The gross non-performing loans (“NPL”) stood at THB 5.5 billion, with an equivalent gross NPL ratio of 3.1%. This is an increase from 2.5% as at 31 December 2013 due to the economic slowdown and increase in corporate and certain retail segments. The increase in corporate NPLs is from certain sizable accounts and the Bank believes that they do not reflect any systemic pattern at this time. CIMB Thai continues to exercise high credit risk underwriting standards and risk management policies. The bank also focuses on improving productivity in monitoring, collection and managing all accounts closely and effectively.
CIMB Thai Group’s loan loss coverage ratio decreased to 100.6% as at 31 March 2014 from 107.8% at the end of December 2013. As at 31 March 2014, our total provisions stood at THB 5.5 billion showing an excess of THB 2.6 billion over Bank of Thailand’s reserve requirements.
Total consolidated capital funds as at 31 March 2014 stood at THB 26.3 billion. BIS ratio stood at 13.4%, 10.1% of which comprised Tier-1-capital.