Krungsri posts first-half 2023 net profit of 17.10 billion baht
Krungsri posts first-half 2023 net profit of 17.10 billion baht
Krungsri (Bank of Ayudhya PCL and its business units) reports
17.10 billion baht in net profit for the first half of 2023, an increase of 12.1% over-year, mainly driven by operating income, following the notable growth in both net interest income andnon-interest income, complemented by initial revenue streams from the acquired overseas businesses in the second quarter.
The strong performance was owing to increases in net interest income and non-interest income as the key drivers, notwithstanding higher operating expenses in line with accelerating economic activities and provisions. Total loans increased by 3.1% from the end of 2022, largely attributable to the expansion of 9.1% in SME loans and 4.5% in retail loans, consolidated with consumer finance loans from new subsidiaries in the Philippines and Vietnam.
Highlights of Krungsri’s consolidated first-half 2023 performance:Net profit: Recorded at 17,102 million baht for 1H/23, increasing 12.1%, or 1,849 million baht from 1H/22, supported by both higher domestic operating income and initial revenue streams from the overseas contribution.Loans: Increased by 3.1% or 60,689 million baht from the end of December 2022, underpinning the improving strength in domestic economic activities, complemented by the consolidation of consumer finance portfolios from the Philippines and Vietnam.Deposits: Decreased by 0.4% or 6,857 million baht from the end of December 2022.Net interest margin (NIM): Markedly increased to 3.52% from 3.36% in 1H/22, driven by the improvement in yield on earning assets.Non-interest income: Increased by 7.6%, or 1,254 million baht from 1H/22, largely due to gains on financial instruments measured at fair value through profit or loss (FVTPL), net fees and service income from the acquired overseas businesses, as well as bad debt recoveries.Cost to income ratio: Recorded at 43.6%, slightly increasing from 42.9% in 1H/22, underscoring the acceleration in economic activities.Non-performing loan (NPL) ratio: Overall asset quality remained sound with the NPL ratio relatively stable at 2.31%. Meanwhile, credit cost stood at 134 basis points.Coverage ratio: Remained healthy at 161.7%.Capital adequacy ratio (Bank only): Recorded at 17.72%, compared with 17.97% at the end of December 2022.
Krungsri President and Chief Executive Officer Mr. Kenichi Yamato, said “Guided by our strategic aspiration of becoming a leading ASEAN bank, key milestones reached in the first half of 2023 were the completed acquisitions of consumer finance businesses in the two fastest growing markets in the region – the Philippines and Vietnam. These new subsidiaries were attributed to an increase in loan outstanding recorded for the period.”
“Barring potential impacts of political uncertainty, the Thai economic expansion is expected to remain on track in the second half of 2023, supported mainly by the strength of the tourism sector and private consumption. A key impetus of this growth is the broader-based recovery, which should promote employment and labor income, thereby sustaining the economic momentum and contributing to the growth rate of 3.3% forecasted by Krungsri. The Bank maintains our loan growth outlook at the target range of 3 – 5%.”
As of 30 June 2023, Krungsri, Thailand’s fifth largest bank in terms of assets, loans and deposits, and one of Thailand’s Domestic Systemically Important Banks (D-SIBs), reported 2.01 trillion baht in loans, 1.80 trillion baht in deposits, and 2.70 trillion baht in total assets. Krungsri’s capital (Bank only) was strong at 299.62 billion baht, equivalent to 17.72% of risk-weighted assets, with 13.02% in common equity tier 1 capital.
