TMBThanachart Bank (TTB) Q2 2024 earnings summary

Executive summary

• Net profit for 1H24 reached THB 10,689 million, up 21% year-over-year, with ROE at 9.2% as core strategies delivered improved performance.

• Q2 2024 was challenging due to uneven national economic recovery, prompting a continued conservative strategy focused on strong balance sheet, capital, and liquidity.

• Maintained NIM through liquidity recycling and pre-funding, with LDR at 95% reducing deposit cost pressure for 2H24.

• Continued cost discipline, achieving a C/I ratio in the low 40s, and maintained a strong capital position post-merger.

• The auditor issued an unqualified opinion, confirming fair presentation in accordance with Thai Financial Reporting Standards.

Financial highlights

• Net profit for 1H24 was THB 10.7 billion, up 21% year-over-year; NIM at 3.27%, above target range.

• Net interest income for the six months was Baht 28,581 million, up from Baht 27,595 million year-over-year.

• Cost-to-income (C/I) ratio held at 42%, reflecting effective cost management amid income slowdown.

• Fee income related to lending declined due to conservative loan growth, but credit card and mutual fund fees showed positive momentum.

• Expected credit loss expense increased to Baht 10,397 million from Baht 8,520 million year-over-year.

Outlook and guidance

• NIM target maintained at 3.10%-3.25% for 2024, with less pressure on deposit costs expected in 2H24.

• Management overlays for expected credit loss were maintained due to economic uncertainties and vulnerable customer segments.

• Continued focus on digital transformation and ecosystem strategies to drive future growth.

• Asset quality and risk cost guidance maintained, with continued conservative provisioning.