Bangkok--20 Apr--Bangkok Bank
Bangkok Bank and its subsidiaries have reported a consolidated net profit of Baht 8.3 billion for the first quarter of 2016, compared to Baht 7.7 billion from the fourth quarter of 2015. Net interest income rose by Baht 417 million or 2.7 percent to Baht 16.0 billion. Non-interest income declined by Baht 121 million or 1.1 percent to Baht 10.7 billion, while operating expenses increased by Baht 710 million or 5.8 percent to Baht 12.9 billion.
In the first quarter of 2016, the Thai economy gradually recovered due to well-disbursed public spending and continued tourism growth. However, private consumption remained subdued by the decline in farm income coupled with the impact of the drought on crop yields and ongoing high levels of household debt. In terms of private investment, some industries continued to grow, but at relatively low rates as exports of goods (excluding gold) continued to contract in line with the slower growth in trading partners' economies, particularly China, and export prices continue to fall in accordance with lower global commodity prices. Against this backdrop, the Bank's loans at the end of March 2016 amounted to Baht 1,874.9 billion, an increase of Baht 6.0 billion or 0.3 percent from the end of 2015, with growth in lending to medium-sized and small businesses, and in loans made through the Bank's international network.
The slow economic recovery impacted the solvency of businesses and households. At the end of March 2016, the Bank's non-performing loans (NPLs) were Baht 61.8 billion and the ratio of NPLs to total loans was 2.9 percent. However, the Bank continued to focus on effective risk management to ensure its loan quality remained at appropriate levels, staying close to its customers and providing them with relevant advice and assistance.
The Bank continued its prudent strategic approach by consistently setting aside provisioning expenses. In the first quarter of 2016, these amounted to Baht 3.6 billion, representing a ratio of loan loss reserves to total loans of 5.8 percent.
The Bank also maintained its focus on managing liquidity and financial costs to ensure they are at appropriate levels. At the end of March 2016, the Bank reported total deposits of Baht 2,149.3 billion, an increase of Baht 58.4 billion or 2.8 percent from the end of 2015. The loan-to-deposit ratio was 87.2 percent, compared with 89.4 percent at the end of the previous year.
The Bank reported a net profit for the first quarter of 2016 of Baht 8.3 billion, an increase of Baht 636 million or 8.3 percent from the fourth quarter of 2015. Net interest income rose by Baht 417 million or 2.7 percent to Baht 16.0 billion, and net interest margin increased by 0.04 percent to 2.37 percent due to lower cost of deposits. Non-interest income was Baht 10.7 billion, a decrease of Baht 121 million or 1.1 percent, due largely to the decline in gains on disposal of assets. Net fees and service income amounted to Baht 6.1 billion, a decrease of Baht 134 million or 2.1 percent, due to the increase in fees and service expenses, while fees income was at a similar level to the previous quarter. The Bank's operating expenses were Baht 12.9 billion, an increase of Baht 710 million or 5.8 percent.
The Bank maintained a strong level of capital reserves to support future business expansion. After the inclusion of net profit for the six months from July to December 2015 and net profit for the three months from January to March 2016, minus the dividend payment in May 2016, the total capital adequacy ratio, Tier 1 capital ratio and common equity Tier 1 ratio of the Bank and its subsidiaries would be approximately 18.5 percent, 16.5 percent and 16.5 percent, respectively.
Shareholders' equity as of March 31, 2016 amounted to Baht 370.5 billion, equivalent to 12.6 percent of total assets. The book value per share was Baht 194.11, an increase of Baht 4.55 from the end of 2015.