CIMB Thai registers 24.3% jump in 2022 net profit to RM395mil

KUALA LUMPUR: CIMB Thai Bank PCL, a 94.83% indirectly held subsidiary of CIMB Group Holdings Bhd, posted a net profit of THB3.03bil (RM395mil) in the financial year ended Dec 31, 2022, which represented a 24.3% increase from the previous year.

According to CIMB Thai president and CEO Paul Wong Chee Kin in a statement, the improvement was mainly owing to better cost control and a significant 39.4% decrease in expected credit losses due to a lower impairment of assets.

He added that the stronger performance was despite a marginal decrease in operating income.

In 2022, CIMB Thai's operating income dropped 2.9% year-on-year (y-o-y) to THB13.75bil due to a contraction in net interest income.

Wong reported other operating income was 3.9% y-o-y lower due to a decrease in gains on sale of investments.

However, a 3.4% y-o-y increase in net fee and service income from higher underwriting fee income partially offset the decline.

Wong said operating expenses were flat while the cost-to-income ratio was higher at 57.1% compared with 55.5% in 2021 due to lower operating income.

The bank's net interest margin over earning assets stood at 2.7% in 2022 compared with 3.1% in 2021, due to higher cost of funds and lower loan yields.

As at Dec 31, 2022, total gross loans (inclusive of loans guaranteed by other banks and loans to financial institutions) stood at THB 235.3bil, an increase of 11% y-o-y.

Deposits (inclusive of bills of exchange, debentures and selected structured deposit products) stood at THB289.7bil, an increase of 21% from THB239.5bil as at end-December 2021.

The modified loan to deposit ratio decreased to 81.2% from 88.5% as at Dec 31, 2021.

Gross non-performing loans (NPL) stood at THB7.8bil with a lower equivalent gross NPL ratio of 3.3% compared to 3.7% as at Dec 31, 2021.

"The lower NPL ratio was mainly due to the sale of some NPLs in 2022, as well as improved efficiency in risk management policies, asset quality management and loan collection processes," said Wong.

CIMB Thai’s loan loss coverage ratio stood at 114.6% as at Dec 31, 2022, from 117.5% at the end-December 2021.

According to Wong, total allowance for expected credit losses stood at THB8.2bil, THB1.5bil over the Bank of Thailand’s reserve requirements.

Total consolidated capital funds as at Dec 31, 2022, stood at THB57.6bil, whilst BIS ratio stood at 21.8%, of which, 16.1% comprised Tier-1 capital.

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