3 Oct 2022
Financial Institutions
Outstanding debt of Thai households rose to THB 14.76 trillion in 2Q22. However, when compared to economic value, the household debt to GDP ratio in 2Q22 dropped to 88.2 percent, against the 89.2 percent recorded for 1Q22. Additionally, when compared to the same period of last year, the household debt grew only 3.5 percent YoY, hitting an 18-year low, and slowing from the 3.7 percent YoY increase in 1Q22. In terms of structure, home loans and loans for own business still accounted for the majority of household debt (a combined portion of 53 percent of overall household debt).... Read more
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25 Nov 2019
Net loans in October 2019 decreased from the previous month by 87.7 billion Baht amid the pressure on loans at almost all banks, especially from debt repayment by the corporate sector, SME business operators and the government. Nonetheless, retail loans, namely, personal loan and other unsecured loans without collateral, continued to increase due to seasonal factors. Auto hire purchase loan and mortgage loan rose from the previous month, albeit at a slower pace. Consequently, outstanding net loans in October 2019 slowed to 11.702 trillion Baht, an increase of only 2.40 percent YoY – the lowest rate in over two years – and decelerating from 3.92 percent growth YoY in September 2019. The trend is a reflection of poor economic performance, which restrains the recovery of borrowers’ demands to withdraw funds from their loan facility. ... Read more
18 Jul 2019
We at KResearch project that net profit overall of commercial banks registered in Thailand will reach approximately THB51-52 billion in 2Q19, declining from the THB52.59 billion reported for 1Q19. Operating profit in 2Q10 may recover at a slower pace because income growth from core business of commercial banks, including interest income, plus fees and service income, hinges on a clear economic recovery, which is expected to begin during 2H19.... Read more
7 May 2019
In 2018, the number of ATMs and electronic devices used in the commercial banking system contracted 0.98 percent YoY, against the 5.17 percent growth reported for 2017, representing the first shrinkage in 35 years. Such a contraction was consistent with the substantial increase in the number of financial transactions made via digital channels. This suggests a decline in the need for the use of cash and represents a challenge to the ATM business of commercial banks in terms of its cost-effectiveness. In addition, commercial banks are increasingly turning to digital channels because the costs in offering financial services through ATMs are 30 times higher than those provided via digital channels. The cost-effectiveness of the ATM business is based on monetary and non-monetary factors, namely customer satisfaction and convenience in using financial services. ... Read more
29 Jan 2019
In December 2018, net loans overall grew over the previous month by THB118 billion, or 1.03 percent MoM. As a result, net loans for 2018 increased 5.17 percent YoY, with net outstanding loans outstanding at THB11.63 trillion. Growth was seen in all types of loans, led by retail loans. Meanwhile, outstanding deposits rose over the previous month by THB136 billion, or 1.09 percent MoM to THB12.58 trillion. Deposits overall in 2018 grew 3.96 percent over that reported at the end of 2017, led by savings deposits at large banks. ... Read more
26 Sep 2018
Net loans in the Thai commercial banking system (14 commercial banks) grew THB26.4 billion to THB11.34 trillion in August, rising 0.23 percent MoM or 5.85 percent YoY. The increase was supported by all types of retail loan while SME loans began to recover somewhat. However, because there were still business loan settlements, net loans rose only marginally in August. Meanwhile, deposits contracted from the previous month by THB25.3 billion or 0.21 percent MoM to THB12.27 trillion, led by CASA deposits. As a result, deposit growth slipped to 4.73 percent YoY and 1.43 percent YTD. Liquidity in the commercial banking system also tightened as evidenced by the ratio of net loan to deposit, plus issued debt and borrowing (LTD+Borrowing Ratio) that edged up to 87.63 percent, over 87.23 percent reported for July.... Read more
14 Sep 2018
We at KResearch are of the view that the Monetary Policy Committee (MPC) will likely keep its policy rate steady at 1.50 percent during the meeting scheduled for September 19, 2018. This is because it may not see the need to raise its policy rate much at this time despite steady improvements in the Thailand economy. Moreover, volatile capital movements and benign inflation may not prompt the MPC to change its stance at the upcoming meeting either. Inflationary pressure is limited especially from the demand side while there are no signs that inflation expectation will increase significantly in the future, so there is no need for the MPC to raise its policy rate in order to curb inflation now. In addition, Thailand’s external stability remains robust; therefore risk of capital flight is low as evidenced by net purchase of foreign investors in the Thai bond market. Given this, a policy hike may only attract more foreign capital into Thailand, thus strengthening the Baht’s value on a par with currencies of our trade rivals. ... Read more
25 Jul 2018
Net loans overall for June increased over the previous month by THB106 billion to THB11.31 trillion, or 0.95 percent MoM, the highest level in 1H18. When compared to the same period of 2017 and at the end of 2017, June net loans grew 5.02 percent YoY, or 2.23 percent YTD, chiefly at large banks in line with increases in corporate and retail loans while SME loans continued to decline at several banks. ... Read more
26 Mar 2018
Net loans in February 2018 rose THB67 billion over January to USD11.05 trillion, thus rising 0.61 percent MoM and 4.36 percent YoY. Most increases were seen in large business loans, including working capital and term loans, while retail loan growth was mainly driven by auto financing on new and used cars as well as auto refinancing loans. SME loans had recovered gradually to marginal growth, while credit card loans slowed on loan repayments that continued to be brisk from the previous month. During the 2M18 period, loan growth had decelerated versus the end of 2017, but is expected to return to growth again by the end of 1Q18, buoyed by large corporate loan demand for use in their expansion of production capacities in line with the apparent international business recovery. Retail loans will likely perform better after subsiding somewhat on recent credit card paybacks and strong growth in auto loans. Meanwhile, competition in retail loan products presented via mobile banking apps by various banks will no doubt attract many customers soon enough, too.... Read more
1 Jan 1
In April 2018, net loans overall increased 0.61 percent MoM (THB67.8 billion), or 4.81 percent YoY to THB11.14 trillion, as expected. The increase was seen at almost all banks, led chiefly by business loans and retail loans (which include home, hire-purchase and unsecured personal loans). Meanwhile, deposits hit a four-month high of THB12.36 trillion, rising 0.99 percent MoM (THB121 billion), or 6.28 percent YoY. ... Read more