SCB X Public Company Limited (SET: SCB) emerged as the standout performer in the third-quarter earnings season among major banks in Thailand, exceeding LSEG’s consensus by a significant 9%.
The bank’s stellar performance was attributed to lower expected credit losses, increased net interest income driven by the rate hike cycle, corporate customer prepayments from the comprehensive debt restructuring, and reduced operating expenses. SCB highlighted in its statement that its asset quality remains well under control.
Following closely behind is Bangkok Bank Public Company Limited (SET: BBL) with a 6% positive surprise. The bank’s strong performance was supported by a healthy net interest margin improvement to 3.06%, gains on investment and financial instruments, and reduced credit costs.
| 3Q24 Net Income
(Mln Baht) |
Surprise | YoY Growth | |
| SCB | 10,941 | 9.06% | 13.22% |
| BBL | 12,476 | 6.33% | 10% |
| KTB | 11,107 | 4.91% | 8.02% |
| KBANK | 11,965 | -0.60% | 6.05% |
| TTB | 5,230 | -1.46% | 10.45% |
| BAY | 7,672 | N/A | -5.22% |
| TISCO | 1,713 | -0.35% | -8.59% |
| KKP | 1,305 | 35.62% | 1.95% |
| CREDIT | 1,162 | N/A | 17.85% |
| CIMBT | 596 | N/A | 62.40% |
| LHFG | 580 | N/A | 7% |
| Total | 7.10% |
Among mid-small size banks, Kiatnakin Phatra Public Company Limited (SET: KKP) led the pack with an impressive 35% earnings surprise based on LSEG’s consensus.
Overall, Thai commercial banks collectively reported a 7% increase in net profit for the third quarter of 2024. While some banks surpassed expectations, there were concerns raised by Asia Plus Securities (ASPS) regarding the rising bad debts alongside improving net profits.
Executive Vice-President of ASPS, Terdsak Taweethiratham mentioned the utilization of provisions to mitigate bad debts in Q3 and maintained a recommendation on TISCO due to its attractive 8% dividend yield.
In response to the Bank of Thailand’s decision to reduce policy rates to 2.25% from 2.50%, Siam Commercial Bank, Kasikornbank, and TMBThanachart Bank are among the first commercial banks to initiate a reduction in borrowing costs.
