Ms. Kattiya Indaravijaya, Chief Executive Officer of Kasikorn Bank, revealed that the Thai economy in the third quarter of 2021 was increasingly affected by the COVID-19 situation and strict outbreak control measures in many areas. Some domestic economic activities faced disruptions, while exports grew at a slower rate amid the pandemic abroad. However, the Thai economy may show signs of gradual recovery in the final quarter of the year due to progress in vaccine distribution, easing of outbreak control measures, and government economic support measures.

The bank and its subsidiaries reported a net profit of 28.151 billion baht for the 9-month period of 2021, with a net profit of 8.631 billion baht for the third quarter of 2021. The performance for the 9-month period of 2021 compared to the same period in 2020

The bank and its subsidiaries achieved a net profit of 28.151 billion baht, an increase of 11.922 billion baht or 73.47% from the same period last year. This was primarily due to a 28.28% decrease in expected credit loss (ECL) provisions compared to the same period last year. In the previous year, the bank and its subsidiaries had set aside a high provision of 42.879 billion baht under a cautious approach to address the uncertainties of the contracting economic situation due to COVID-19, an unprecedented crisis, as well as the potential impacts from government measures to assist affected customers, necessitating close monitoring of debt quality. Although the Thai economy in the 9-month period of 2021 was more adversely affected by the new wave of COVID-19 and strict outbreak control measures in many areas, the bank and its subsidiaries closely assessed the situation and continuously prepared to address the uncertainties of the slowing economy while continuing to assist customers through various measures, including providing loans to enhance liquidity. Therefore, the bank and its subsidiaries considered setting aside a total of 30.752 billion baht in provisions for the 9-month period of this year, maintaining a cautious level of reserves.

The profit from operations before expected credit loss provisions and income tax for the 9-month period of 2021 was 70.259 billion baht, an increase of 4.003 billion baht or 6.04% from the same period last year, with net interest income increasing by 6.171 billion baht or 7.49%, in line with the growth of lending. Although the bank reduced interest rates to alleviate customers' financial burdens, the loan growth rate was 8.87%, primarily from lending to potential customers, along with customer assistance measures to enhance liquidity so that customers could return to normal business operations. The bank closely monitored the quality of its debtors to provide ongoing support. Additionally, some customers were under measures to defer principal and interest payments, leading the bank to manage increased interest receivables. The decrease in interest expenses resulted from efficient financial cost management, resulting in a net interest margin (NIM) of 3.21%.

Meanwhile, non-interest income decreased by 1.326 billion baht or 3.95%, mainly due to the fair value adjustment (mark to market) of financial assets in line with market conditions and a decrease in net insurance income, although net fee and service income increased by 1.864 billion baht or 7.55%, mainly from fees received from fund management and commissions from securities trading. Other operating expenses increased by 842 million baht or 1.69%, due to employee-related expenses and costs from projects that the bank undertook to alleviate customer burdens during the outbreak control measures, with the ratio of other operating expenses to net operating income (cost to income ratio) at 41.85%.

Performance for the third quarter of 2021 compared to the second quarter of 2021

The bank and its subsidiaries reported a net profit of 8.631 billion baht, a decrease of 263 million baht or 2.96% from the previous quarter, with net interest income increasing by 1.024 billion baht or 3.45%, primarily from lending growth, with a net interest margin (NIM) of 3.23%. Meanwhile, non-interest income decreased by 1.936 billion baht or 17.38%, mainly due to the fair value adjustment (mark to market) of financial assets in line with market conditions. Other operating expenses slightly decreased by 104 million baht or 0.61% due to expense management during the economic slowdown, with the ratio of other operating expenses to net operating income (cost to income ratio) at 42.47%. Additionally, the bank and its subsidiaries increased expected credit loss provisions by 489 million baht or 4.53% from the previous quarter.

As of September 30, 2021, the bank and its subsidiaries had total assets of 4,029,831 million baht, an increase of 371,033 million baht or 10.14% from the end of 2020, primarily due to growth in lending and an increase in net investments. The ratio of non-performing loans (NPL) to total loans (%NPL gross) as of September 30, 2021, was 3.85%, with the bank closely monitoring the quality of loans to affected debtors, compared to 3.93% at the end of 2020. The coverage ratio for expected credit loss provisions to non-performing loans as of September 30, 2021, was 156.96%, compared to 149.19% at the end of 2020. The total capital ratio to risk-weighted assets of Kasikorn Bank's financial business group under Basel III guidelines as of September 30, 2021, was 18.82%, with a Tier 1 capital ratio of 16.53%.