In the third quarter of 2022, Thailand’s economic recovery was driven by the gradual improvement in economic activity and the easing of travel restrictions in Thailand and other countries, which increased the number of foreign tourist arrivals to an average 1.2 million per month. However, policy rate hikes by central banks in many countries to mitigate high inflation affected the economic expansion and global commerce. As a result, Thai export growth during July – August 2022 slowed to 6 percent from 11 percent in the previous quarter. Going forward, the volatility of financial markets and the global economy remains important factors to be closely monitored.
Bangkok Bank continues to collaborate closely with its customers as the global economic slowdown poses a challenge to Thailand economic recovery. The Bank supports customers in accordance with their circumstances and offers guidance on how to modify their business practices in order to keep up with evolving trends and achieve sustainable growth with our commitment to be a trusted partner and reliable close friend. At the same time, the Bank places importance on prudent risk management and maintaining its financial stability, liquidity and capital positions.
Bangkok Bank reported an increase of 7.7 percent in net profit for the nine months of 2022
The Bank and its subsidiaries reported a net profit for the nine months of 2022 of Baht 21,736 million, an increase of 7.7 percent from the same period last year, owing primarily to an 18.7 percent increase in net interest income from loan expansion driven by the economic recovery. In line with interest rate trends and liquidity management, the net interest margin increased to 2.28 percent. Non-interest income decreased by 21.8 percent, predominantly from the slowdown in gain on fair value of financial instruments in line with the market environment. Net fees and service income declined from lower fees from securities business, while fee from loan related and trade finance services increased. Operating expenses rose by 4.2 percent largely due to higher expenses to develop and improve working systems, while the cost to income ratio remained at 49.0 percent. The Bank set aside Baht 24,733 million in expected credit losses, a decrease of 4.9 percent from the same period last year. This is consistent with the Bank’s prudent management by taking into account global economic volatility which may have an impact on the Thai economy’s recovery going forward.
Bangkok Bank maintains a healthy financial position, high liquidity and capital positions under its prudent management approach
At the end of September 2022, the Bank’s total loans amounted to Baht 2,796,849 million, an increase of 8.1 percent from the end of last year, mainly due to an expansion in loans to large corporate customers and loans made through the Bank’s international network. The non-performing loan to total loans ratio remains manageable at 3.5 percent. The Bank continues to set aside expected credit losses in line with its prudent approach, leading to the strong ratio of allowance for expected credit losses to non-performing loan of 240.1 percent.
As of September 30, 2022, the Bank’s deposits amounted to Baht 3,165,479 million, rising by 0.3 percent from the end of 2021. The loan to deposit ratio stood at 88.4 percent. In terms of capital, the capital adequacy ratio, Tier 1 capital adequacy ratio, and Common Equity Tier 1 capital adequacy ratio of the Bank and its subsidiaries stood at 18.5 percent, 15.2 percent and 14.4 percent respectively, comfortably above the Bank of Thailand’s minimum capital requirements.