Thai banks’ bad debt expected to rise by up to 15% this year

BANGKOK (The Nation/ANN): Thai banks’ non-performing loans (NPLs) will rise significantly this year as Covid-19 continues to take a toll on the economy, experts say.

Siam Commercial Bank (SCB) president Apiphan Charoenanusorn forecasts her bank's bad debt will increase due to the pandemic’s impact on debtors.

"However, we believe the bank will be able to deal with NPLs as most debtors have received the bank's assistance so far.”

She added that SCB would have to set up more reserves to cope with future uncertainty.

Naris Sathapholdeja, head of TMB Analytics, forecasts commercial banks' NPLs this year will rise by up to 15 per cent to Bt604 billion compared to Bt525 billion last year, with an NPL ratio of 3.6 per cent, up 12 per cent compared to 3.2 per cent last year.

"However, commercial banks' NPLs will not increase sharply because they have methods to manage NPLs, such as selling debts and debt restructuring," he said.

Kitichan Sirisukarcha, senior president of research at CGS CIMB Securities, expects net profit at seven Thai banking giants – Kasikornbank, Bangkok Bank, Kiatnakin Phatra Bank, Siam Commercial Bank, Krungthai Bank, TMB Bank and Tisco Bank – to grow 5 per cent on last year to Bt118 billion this year.

He forecasts that figure will rise 22 per cent in 2022 to Bt143 billion as Covid-19 recedes and the economy improves.

"The seven banks' NPLs this year will stand at 4.9 per cent compared to 4.2 per cent last year, while their reserves will increase to Bt209 billion compared to Bt199 billion last year," he predicted.

He advised investors to buy Bangkok Bank (BBL) shares at a target price of Bt146, Kasikornbank (KBANK) at Bt156 and SCB at Bt109, forecasting they would be traded at a price-to-book-value (P/BV) ratio of between 0.75 and 0.8 compared to 0.45 last year. - The Nation/Asia News Network

Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 18
Cxense type: free
User access status: 3

Thailand , banks , bad debts


Did you find this article insightful?


Next In Aseanplus News

Asean News Headlines as at 7pm on Sunday (March 7)
Swiss to back Indonesia trade deal and ban on face-veils
China says hopes US will remove 'unreasonable' curbs on cooperation
China says willing to engage with all parties to ease Myanmar situation
China: Zhong Nanshan, Chen Wei embark on new type of vaccine R&D
Indonesia claims success for lowest deforestation rate in 5 years as Covid-19 cases are still rising and goes above 1.379 million
New Covid-19 cases in Philippines breach 3,000-mark for 3rd straight day; 594,412 in total
Thailand mulls Covid-19 vaccine passports to boost tourism sector; 65 Covid-19 cases on Sunday (March 7)
Singapore students still without TraceTogether tokens to receive them by end of March; 13 imported Covid-19 cases on Sunday (March 7)
Covid-19: 1,683 new cases, three deaths bring death toll to 1,169

Stories You'll Enjoy