Bangkok Bank sees net profit rise 42.1% to $1.16b in 2023

Net interest income rose, but fees and service income decreased.

Thailand’s Bangkok Bank has reported a net profit of over US$1.167b (THB41.63) in 2023, 42.1% higher than in 2024, thanks to higher interest rates, according to a report posted on its website.

Net interest income rose 28% during the year, which Bangkok Bank said was thanks to yield on earning assets rising in line with the interest rate environments.

This was offset by a continued rise in the cost of deposits due to higher interest rates, and the resumption of the Financial Institutions Development Fund (FIDF) fee to the normal rate. As a result, the net interest margin stood at 3.02%. 

Net fees and service income slightly decreased from lower trading volume in stock market, whilst fees from bancassurance and mutual fund services, and credit card business performed better than last year, the bank said. 

Operating expenses rose by 18.5% in 2023 compared to a year earlier, following higher economic activities and partly from expenses to improve operational efficiency. The cost to income ratio stood at 48.8%.

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For the fourth quarter, the bank said that its credit csots have declined by 18.1% compared to Q3. As a result, Bangkok Bank expects its credit losses for 2023 to be THB33.67m, similar to 2022. 

As of end-December, total loans are THB2.67t, similar to 2022. Corporate loans rose, whilst commercial and business loans declined. The bad loans ratio is 2.7% 

Ratio of the allowance for expected credit losses to non-performing loans remained strong at 314.7%.

Total deposits are THB3.1t as of 31 December 2023, slightly lower than in December. Loan-to-deposit ratio is 83.9%.

Total capital adequacy ratio, Tier 1 capital adequacy ratio, and Common Equity Tier 1 capital adequacy ratio of the Bank and its subsidiaries stood at 19.6%, 16.1% and 15.4%, respectively.

(US$1 = THB35.66; as of January 23, 2024, 11:28 AM)