Bangkok--21 Jul--TMB
- Net profit rises 25% from 1Q 2010 to THB886 million
- Improved asset quality, with stronger capital base
TMB also announces the performance of its second quarter today. Growing stronger on a firm recovery path, TMB and its subsidiaries reported a net profit of THB886 million in the second quarter of 2010, a 25.1% increase from THB707 million in the previous quarter, and a 125.4% increase compared to THB436 million net profit in the same quarter last year. Gross loans declined by 2.8% compared to the first quarter of 2010 due to the sell-off of NPLs. SME loan growth was offset by repayments resulting in a marginal drop in overall performing loans by 0.5% compared to the previous quarter. The Bank maintains a high level of liquidity and a solid regulatory capital ratio while TMB’s asset quality continues to improve.
Mr. Boontuck Wungcharoen, CEO of TMB, said both non-performing loans (NPL) and foreclosed properties continued to decline. TMB’s second quarter NPLs dropped to THB44,027 million or 10.9% of total loans versus THB52,727 million or 12.1% of total loans as a result of the sale of NPLs and successful NPL resolutions in the first quarter this year. This was in line with the Bank’s target to reduce its NPL ratio to be within single digits. Foreclosed properties also declined consecutively to THB9,108 million, a 7.9% decrease from THB9,887 million in the first quarter.
TMB’s SME segment achieved a healthy net growth of nearly THB3,000 million from the first quarter this year, but was offset by repayments particularly in the corporate segment, making the Bank’s net performing loans drop marginally by 0.5% compared to last quarter. The Bank’s balance sheet remains liquid with cash, interbank and investments as of the second quarter, 2010, representing 32.3% of its total earning assets. TMB’s loan to deposit ratio was 88.8% in the second quarter, a slight change from 88.4% in the first quarter, 2010, but remains at a comfortable level. The Bank’s capital position is solid with an increase in its capital adequacy ratio (CAR) to 18.4% as a result of the completion of subordinated debts issuance in April. The ratio was comfortably above minimum requirement at 8.5% by the Bank of Thailand.
Additionally, in the second quarter of 2010, the Bank cleaned up its retained losses and share discount through a par value reduction from THB10 to THB0.95, with no impact on regulatory capital, book value per share, number of shares and shareholders’ effective controls. The accounting exercise was approved by the Extraordinary General Meeting held on 24 June 2010 and was completed at the end of the second quarter. This clean-up resulted in extra flexibility for TMB to pay dividends when it is appropriate.
Mr. Boontuck noted that TMB’s branding efforts have been successful in improving brand consideration and reducing brand rejection numbers. A third-party independent survey showed TMB’s brand consideration has grown from 31% in May 2009 to 76% in May 2010. During the same period, TMB’s brand rejection declined from 29% to 6%.
“A new chapter of TMB has begun with a clean balance sheet, without loads of retained loss. We are moving forward aggressively according to our business plan, leveraging the Bank’s stronger capital base. However, we still have to do more to reach our goals. We need to strive to further improve asset quality, provide customers with good service, innovative products and financial solutions which suit their needs to differentiate TMB from the industry, expand our service channels and visibility to build a larger customer base, and create higher profitability for the Bank to become a market leader in the next few years.”
TMB Bank Public Company Limited
Founded on 8 November 1957, TMB Bank Pcl. operates a commercial banking business under a license granted by the Ministry of Finance, and with consent given by the Bank of Thailand. It also operates a securities business licensed by the Ministry of Finance and agreed to by the Securities Exchange Commission.
TMB aims to respond to the needs of its clients through its 458 branch network, 100 foreign exchange centers 2,278 ATMs, as well as electronics banking systems. Its business encompasses commercial banking, offshore banking, investment banking, and other businesses as permitted by the regulatory authorities, including acting as an insurance agent for its alliance insurance companies.
Listed on the Stock Exchange of Thailand, TMB is the sixth largest bank, by total assets, in Thailand. As at 31 March 2010, its total assets are valued at THB 560,028 million.
www.tmbbank.com
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