CIMB Thai records net profit of THB 1.74bil

KUALA LUMPUR: CIMB Thai Bank PCL, a 94.83% owned subsidiary of CIMB Group Holdings Bhd, recorded a lower net profit of THB1.74bil in the nine months ended Sept 30, 2023, which was a 38.2% year-on-year (y-o-y) decline due to an increase in operating expenses and expected credit loss.

CIMB Thai president and CEO Paul Wong Chee Kin reported the bank’s operating income during the period was THB10.32bil, a 3.6% decrease y-o-y due to a decline in net fee and service and other income, although this was partially offset by higher net interest income.

“On a y-o-y basis, net interest income increased by THB274.7mil or 3.9% mainly driven by loan expansion and an increase in interest income on investments,” he said.

On the flip side, the bank posted lower net fee and service income of THB213.1mil, or 18.6% y-o-y, largely attributed to lower fee income from insurance brokerage.

Total other operating income decreased 18.1% y-o-y or THB449mil, mainly on lower net gains on financial instruments measured at fair value through profit or loss, partially offset by higher gains on investment and sale of non-performing bonds.

For the nine-month period, operating expenses rose 9.7% y-o-y, mainly from higher impairment loss on properties for sale as well as taxes and duties, resulting in a higher cost-to-income ratio of 60.6%, compared to 53.2% in 9M22.

Net interest margin (NIM) over earning assets stood at 2.6% in 9M23, compared to 2.7% in 9M22, arising from higher cost of funds.

As at end-Sept 2023, the bank’s total gross loans (inclusive of loans guaranteed by other banks and loans to financial institutions) stood at THB249.4bil, which was 6% higher from Dec 31, 2022.

Deposits (inclusive of bills of exchange, debentures and selected structured deposit products) stood at THB298.2bil, an increase of 2.9% from THB 289.7bil as at end-December 2022. The modified loan to deposit ratio increased to 83.6% from 81.2% as at Dec 31, 2022.

Gross non-performing loans (NPL) stood at THB8.5bil, with a lower gross NPL ratio of 3.2% from 3.3% as at De 31, 2022.