Bangkok--20 Apr--Siam Commercial Bank
Siam Commercial Bank PCL reported (unreviewed) consolidated net profit of Baht 13,152 million for the first quarter of 2015 – an increase of 0.2% from the first quarter earnings reported in 1Q14. The modest increase in net profit masks the year-on-year robust increases in net interest income (mainly from a decline in interest expenses as well as from loan growth), net trading and FX income and net fee income. This modest growth in profitability was due to the one-time expense relating to the KMITL deposit account , prior to any future recoveries. (Excluding this loss, net profit would have grown by 9.3%.)
Commenting on the results, newly appointed CEO of the Bank, Arthid Nanthawithaya noted that “the robust quarterly results attest to the strong existing franchise of the Bank that is able to maintain its quarterly earnings record despite a very challenging economic backdrop and an exceptional one-time loss from the KMITL deposit account. As we set out to transform the Bank’s future positioning, we expect that the current franchise will endure and deliver strong results, particularly as the economy recovers”.
Net interest income rose 6.0% to Baht 20,532 million in 1Q15 from the level reported in 1Q14. In part, this increase was the result of the Bank’s reported strategy to reduce interest expenses on deposits. In part, this increase was from loan growth of 4.3% over the year, particularly in the wholesale and mortgage segments.
Non-interest income increased 4.4% to Baht 12,010 million in 1Q15 from the level reported in 1Q14. The main contributions were from growth in net trading and FX income, net fee income and dividend income.
Non-interest expenses increased 13.4% to Baht 12,498 million in 1Q15 from the level reported in 1Q14. The increase in operating expenses was substantially from the one-time expense relating to the KMITL deposit account, prior to any future recoveries. Stripping out this exceptional expense, the non-interest expenses were relatively flat year-on-year.
The Bank set aside Baht 3,601 million of impairment loss provision for 1Q15 or 80bps of total loans – 12.3% higher than the same period last year. The NPL-to-loans ratio stood at 2.13% at the end of March 2015, up from 2.11% at the end of December 2014, while the coverage level for NPLs excluding any collateral consideration remained stable at 138.1% at the end of March 2015.
The Bank’s newly appointed President, Yol Phokasub, stated that “the results reflect the strong loyalty of the SCB customers and the spirit and engagement of the SCB group employees. These two factors will underpin our efforts to further improve our performance and attain our goal of being ‘the Bank of Choice’ for all our stakeholders”.