Kasikornbank announced a profit of 11.211 billion baht for Q1/2022, noting that the recovery of the Thai economy remains uncertain due to COVID-19 and the impact of the Russia-Ukraine war on energy prices.

Ms. Kattiya Indaravijaya, CEO of Kasikornbank, stated that the Thai economy in the first quarter of 2022 continues to face limitations in recovery. Although there are supports from exports, spending, and government measures to boost purchasing power, private sector spending, both in consumption and investment, is still affected by the COVID-19 outbreak and rising inflation, oil prices, and production costs. Looking ahead for the remainder of the year, the path to recovery for the Thai economy remains uncertain as it continues to deal with the COVID-19 situation and the impacts of the conflict between Russia and Ukraine on energy prices and global economic trends.

Performance for Q1 2022 compared to Q1 2021

The bank and its subsidiaries reported a net profit of 11.211 billion baht, an increase of 584 million baht or 5.50% from the same quarter last year, driven by a rise in net interest income of 3.618 billion baht or 12.86% from interest income on loans, which increased in line with the growth of lending, primarily due to new loans provided to potential customers as per the bank's strategy. Additionally, measures to assist customers by enhancing liquidity have allowed them to return to normal business operations, while some customers remain under measures to defer principal and interest payments, necessitating ongoing management of accrued interest receivables by the bank.

Meanwhile, non-interest income decreased by 3.032 billion baht or 25.49%, mainly due to the fair value adjustment (Mark to market) of financial assets in line with market conditions. Operating expenses increased by 859 million baht or 5.20%, primarily due to information technology expenses to better meet customer demands and marketing expenses. The bank and its subsidiaries also set aside provisions for expected credit losses (ECL) which increased by 686 million baht or 7.93% compared to the same quarter last year, in line with the growth of lending and the ongoing economic uncertainty from the COVID-19 situation and global economic trends.

 

Performance for Q1 2022 compared to Q4 2021

The bank and its subsidiaries reported a net profit of 11.211 billion baht for Q1 2022, an increase of 1.310 billion baht or 13.23% from the previous quarter, with net interest income rising by 951 million baht or 3.09%, primarily from interest income on loans, which increased in line with lending growth. This resulted in a net interest margin (NIM) of 3.19%, while non-interest income decreased by 2.861 billion baht or 24.40%, mainly due to the fair value adjustment (Mark to market) of financial assets in line with market conditions and a decline in net income from insurance.

Operating expenses decreased by 3.088 billion baht or 15.08%, as the previous quarter included expenses related to activities with business partners and seasonal marketing expenses. This resulted in an operating expense ratio to net operating income (Cost to income ratio) of 42.82% for this quarter.

Additionally, the bank and its subsidiaries set aside provisions for expected credit losses (ECL) at a level similar to the previous quarter, maintaining a cautious approach in considering various factors carefully amidst the ongoing uncertainty of economic recovery from the COVID-19 situation and global economic trends. The coverage ratio for expected credit loss provisions to non-performing loans as of March 31, 2022, stood at 158.33%, which is deemed appropriate in line with the current situation.