TMBThanachart reported a net profit of THB 5,112 million in the fourth quarter, totaling THB 21,031 million for the 12-months of 2024. Asset quality remained under control with a low NPL ratio of 2.59%. As moving into 2025, the Bank set its path to improve our customers’ life-long Financial Well-being and will continue to support responsible lending and sustainable solutions to address household debt issues.

Bangkok, 20 January 2025 TMBThanachart Bank Public Company Limited, or TMBThanachart (ttb), has announced its financial performance for the 4th quarter and the 12-month period of 2024 (4Q24 and 12M24). Overall, the Bank and its subsidiaries’ operating results were in line with the target with a net profit of THB 5,112 million in 4Q24 and THB 21,031 million in 12M24. This was driven by efficient cost management in three key areas, including funding cost, operating cost and risk cost or provision expense. Asset quality was in check, and liquidity and capital positions remained strong and stable.

Mr. Piti Tantakasem, CEO of TMBThanachart, mentioned, “Overall, the operating performance in 2024 was in line with the target. For ttb to tackle with economic conditions and uncertainties arising from external factors that put pressure on banking sector’s revenue and asset quality, we maintained a prudent business direction and reiterated our focus on cost efficiency to ensure that revenue generation and cost were aligned. Proactive asset quality management remained one of our priorities, as did the ongoing financial support provided to customers. Moreover, we emphasized on capital management, aiming to optimize the utilization of excess capital in ways that would enhance shareholders’ value.

In terms of cost management, the Bank focused on three key aspects. For funding cost management, the Bank has always ensured effective asset-liability management. Our initiatives include the optimization of loan structure, the alignment of deposit-loan growth, and adaptive investment approaches to utilize the changes in interest rate trend in the money market to generate returns.

For operating cost, the Bank has always maintained cost discipline and enhanced operating efficiency. The Bank has continued to improve and developed new digital capabilities for mobile banking application to drive digital transaction volume and reduce the cost-to-serve.

For risk cost or provision expense as the last aspect, the Bank has focused on quality loan growth and targeted segments that fit with our expertise so that we truly understand risk profiles. In addition, the Bank has proactively resolved non-performing loans and provided appropriate financial support through various programs such as ‘Tang-Lak’, ‘You Fight, We Help’, ‘Debt Consolidation’. As we continue to promote debt consolidation, the number of customers who participated in the program in 2024 increased to 37,000 persons from 17,000 persons at the end of 2023. This could translate into a reduction in interest burdens of over THB 2,100 million.

With such prudent approaches, the asset quality situation was manageable and in line with the target. NPLs decreased further by 5% YTD, and NPL ratio declined to 2.59% from 2.62% in 2023. As a result, provision expense dropped 11% YoY, a key driver for financial performance in 2024. Despite the lower provision, the NPL coverage ratio, which reflected risk absorption capability, remained high at 151%.

On capital management, the Bank’s executions included optimizing capital structure. The examples were the early redemption of additional Tier 1 debt instruments and reducing the re-issuance size of subordinated debt-Tier 2. Notably, the Bank strategically optimized the allocation of excess capital through various options, such as increasing the dividend payout ratio to 60% from a pre-merger level of 30%-35% and exploring the inorganic growth opportunities. Recently, the Bank has signed the Non-Binding MOU, intending to conduct a due diligence to see the opportunities to acquire shares in Thanachart Securities and TLeasing. These initiatives reflected our commitment to enhancing shareholders’ value in both short- and long-term.

Moving into 2025, ttb will maintain the prudent business direction together with B+ESG business framework, setting goals to generate quality growth and enhance stakeholders’ returns. We will continue our mission to improve customers’ life-long Financial Well-being, and our roles in supporting responsible lending and sustainable solutions to address household debt issues.”

Details of 4Q24 and 12M24 key operating performance are as follows:
As of 4Q24, total loans amounted to THB 1,241 billion, a decline of 1.0% and 6.6% from 3Q24 (QoQ) and the end of 2023 (YTD), respectively, reflecting a result of our prudent loan growth direction. Meanwhile, targeted products continued to grow as per the plan to shift loan mix towards retail lending, led by cash-your-car (+6% YTD), cash-your-home (+12% YTD), personal loans (+10% YTD) and credit card (+7% YTD). The decrease in outstanding loans was due mainly to loan repayments from large corporate, a slowdown in hire purchase loans on the backdrop of a weak auto market, and proactive asset quality management through sales and write-off activities, which led to a 5% YTD decrease in NPLs.

Deposits were at THB 1,329 billion, growing 2.5% QoQ, driven by growth in current and savings deposits. However, deposits decreased 4.2% YTD due to an outflow in high-cost deposits, a result of liquidity management and the alignment with loan growth pace. On the other hand, retail loans such as all free deposits continued to expand. Overall, liquidity remained high as reflected by the loan-to-deposit ratio at 93%.

On the revenue side, the Bank recorded a total operating income of THB 17,133 million and operating expenses of THB 7,496 million in 4Q24. For 12M24, operating income totaled THB 69,399 million, a 2.2% decrease from 2023 (YoY). Operating expenses were at THB 29,571 million, a drop of 4.9% YoY. As a result, the cost-to-income ratio lowered to 42.6% in 2024 from 43.6% last year, achieving the target.

Provision expense amounted to THB 4,690 million in 4Q24 and THB 19,852 million in 12M24, which dropped 10.6% YoY. After provision and tax, the Bank reported a net profit of THB 5,112 million and THB 21,031 million for 4Q24 and 12M24, respectively.

Lastly, the capital position remained robust. As of 4Q24, CAR was at 19.3%, and Tier 1 ratio was at 16.9%. This is still one of the top tiers in the banking industry and well above the Bank of Thailand's minimum requirement for D-SIBs, which is 12.0% for CAR and 9.5% for Tier 1.