TMBThanachart reported net profit of THB 2,799 million in 4Q21, increased 127% from the same period last year. For full year, net profit was THB 10,474 million, increased 4% from 2020. Asset quality was in line with plan and NPL ratio stayed at relatively low level of 2.81%. Moving on to 2022, the Bank set to resume loan growth, enhance digital capabilities and launch better financial solutions to customers.

Bangkok, 20 January 2022 – TMBThanachart Bank Public Company Limited or TMBThanachart announced today its 4Q21 and 2021 operating performance. The Bank reported net profit of THB 2,799 million in 4Q21 which increased 19% from previous quarter. Key factors were from better revenue momentum and lower provision as the Bank could reduce non-performing loan ratio to 2.81% from 2.98% in 3Q21. When compared to 4Q20, net profit increased 127% due to lower provision as in 4Q20 the Bank set aside significantly high provision ahead of 2021. Overall, the Bank provided full year provision of THB 21,514 million, relatively close to THB 24,831 million in 2020. Net profit therefore rose to THB 10,474 million, up 4% from 2020.

Mr. Piti Tantakasem, CEO of TMBThanachart, mentioned “Although 2021 was still a challenging year due to prolonged Covid-19 situation, the Bank’s targets were delivered as planned. For merger target, the Bank successfully completed integration process. As for business target, the Bank maintained conservative business direction as well as loan growth. At the same time, the Bank continued to improve portfolio quality by de-risking weak loans. The objective is to preserve financial strength in order to resume growth once economic environment allows.

As economic activities showed recovery signs after the ease of lockdown measures, the Bank started to resume growth and could expand deposit by 1.1% and loan by 0.9% from 3Q21. However, loan growth was still in a conservative direction and focused on secured-lending, especially home loans and hire purchase. Revenue also improved 4.4% from 3Q21, driven by both interest income and non-interest income. On the expense side, cost synergy was realized as planned together with consistency in cost discipline, cost-to-income ratio stayed within target.

Although a conservative approach led to a contraction in loan growth of 1.5% from 2020, portfolio quality was improved. This could be reflected by the combined outstanding of stage 2 and stage 3 loans which decreased by approximately THB 7 billion or 4.4% from the previous year. And as economy is still not back to normal level, the Bank will continue to improve asset quality further.

Details of 2021 operating performance are as follows.

Deposit was at THB 1,339 billion, up 1.1% from 3Q21 driven mainly by retail deposit and in line with loan momentum. However, the figure dropped 2.5% from 2020 as a result of a decrease in term-deposit balance from deposit optimization post-merger and liquidity management amid slow loan growth environment.

Loans was at THB 1,372 billion which rose 0.9% from 3Q21, driven from both retails and large corporate lending. Compared to 2020, loan contracted by 1.5% as the Bank grew loan selectively and continued to de-risk weak loan portfolio. In terms of loans under debt relief program, the outstanding accounted for approximately 12% of total loan portfolio, relatively stable from 3Q21 and portfolio quality remained in control.

Operating revenue in 2021 was at THB 65,537 million which decreased 5.5% from previous year, reflecting the pressure from Covid-19 situation. Operating expense of THB 31,219 million reduced 3.0%. Despite integration activities during the year, operating cost could still decline as a result of cost synergy realization and cost discipline. As a result, cost-to-income ratio was at 48%, in line with target.

In terms of asset quality, non-performing loans (NPL) was at THB 42,121 million, down from THB 44,411 million in previous quarter but up from THB 39,594 million at the end of Dec-20. The ratio of NPL to total loans was at 2.81% as of 4Q21, down from 2.98% in previous quarter but up from 2.50% at the end of 2020 due partly to a contraction of total loan. Overall NPL ratio remained relatively low when compared to industry and the increase from previous year was as the Bank’s expectation and target.

Lastly, capital adequacy remained one of the top tiers in Thai banking industry. At the end Dec-21, the preliminary CAR and Tier 1 was reported at 19.3% and 15.3%, respectively. The figures were well-above the Bank of Thailand’s minimum requirement of 11.0% and 8.5%.

Mr. Piti Tantakasem concluded “For 2022, TMBThanachart plans to resume loan and deposit growth but still in a conservative mode as Covid-19 situation remains uncertain. This year, following the completion of the merger and integration, the Bank will launch and offer new products and services, as well as enhanced digital capabilities that will provide customers with a better experience and improve their Financial Well-being, as well as continue our business growth and improve digital capability."