• January 20, 2016
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Bangkok Bank reports 2015 net profit of Baht 34.2 billion

Bangkok Bank reports 2015 net profit of Baht 34.2 billion. Despite challenging economic conditions, the Bank increased its lending by 4.9% with a manageable ratio of NPLs to total loans of 2.8 percent. Net fees and service income grew by 10.8%, and cost to income ratio was 43.8%.

Bangkok Bank and its subsidiaries have reported a consolidated net profit of Baht 34.2 billion for 2015, a decrease of 5.9 percent from 2014. Total operating income rose 6.1 percent to Baht 102.7 billon, while operating expenses increased by 4.5 percent to Baht 45.0 billion.

Thailand’s economy grew modestly in 2015 due to a slowdown in the export sector, reflecting economic conditions facing major trading partners particularly China, as well as weak private investment and consumption, lower commodity prices, and drought condition. However, the growth in tourism remains robust, while the government has rolled out measures in response to the current condition and has accelerated the implementation of its investment plan. Meanwhile, private expenditure has shown signs of picking up in the last quarter of the year. Against this background, the Bank reported total lending for 2015 of Baht 1,868.9 billion, an increase of Baht 86.7 billion or 4.9 percent from the end of 2014 due to medium-sized business and consumer lending, as well as loans made through the Bank’s international network.

The Bank continued to focus on effective risk management and maintaining loan quality at appropriate levels, staying close to its customers and providing them with relevant advice and assistance. As a result, the Bank’s non-performing loans (NPLs) decreased from Baht 58.1 billion at the end of September 2015 to Baht 56.2 billion at the end of December 2015. The ratio of NPLs to total loans remained at the same manageable level of 2.8 percent.

The Bank continued its prudent strategic approach by consistently setting aside provisioning expenses. In 2015 these amounted to Baht 14.7 billion, resulting in a ratio of loan loss reserves to total loans of 5.6 percent.

In terms of liquidity, the Bank reported total deposits at the end of December 2015 of Baht 2,091.0 billion, an increase of Baht 32.2 billion or 1.6 percent from the end of 2014. The loan-to-deposit ratio at the end of 2015 was 89.4 percent rose from 86.6 percent at the end of 2014 as the increase in deposits was less than the increase in lending, while the ratio of liquid assets to deposits remained high at 43.4 percent. The Bank continuously focuses on liquidity management as well as financial cost management at appropriate levels.

Net profit for 2015 was Baht 34.2 billion, a decline from the previous year. Net interest income decreased by Baht 1.5 billion or 2.5 percent to Baht 57.5 billion. Net interest margin declined by 0.21 percent to 2.16 percent in line with the Bank of Thailand’s lowering of the policy interest rate by 0.50 percent during the first half of 2015. Non-interest income in 2015 was Baht 45.2 billion, an increase of Baht 7.4 billion or 19.4 percent from the previous year, due largely to gains on tradings and foreign exchange transaction and gains on investments. Net fees and service income amounted to Baht 24.1 billion, an increase of Baht 2.3 billion or 10.8 percent, due mainly to an increase in fee income from mutual funds, underwriting and loans. The Bank’s operating expenses were Baht 45.0 billion, an increase of Baht 1.9 billion or 4.5 percent, due mainly to higher personnel expenses, while the cost-to-income ratio decreased to 43.8 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, the total capital adequacy ratio, common equity Tier 1 ratio and Tier 1 capital ratio of the Bank and its subsidiaries would be approximately 18.7 percent, 16.6 percent and 16.6 percent, respectively.

Shareholders’ equity as of December 31, 2015 amounted of Baht 361.8 billion, equivalent to 12.7 percent of total assets. The book value per share was Baht 189.56, an increase of Baht 20.09 from the end of 2014.

Re-disseminated by The Asian Banker