BANGKOK, 17 January 2017 – TMB or TMB Bank Public Company Limited today announced its financial results for the year 2016. The Bank and its subsidiaries reported a pre-provision operating profit (PPOP) of THB 18,667 million, an increase of 10% compared to 2015. The Bank booked relatively high provision at THB 8,649 million to accommodate extra NPL write-offs that helped mitigate future downside risk. As a result, NPL ratio decreased to 2.53% while coverage ratio remained high at 143%. Consequently, net profit is reported at THB 8,226 million.
Mr. Boontuck Wungcharoen, CEO of TMB Bank, said “loans grew by 2.2% in 2016. While corporate and SME loans fell due to weak economic outlook, mortgage loans continued to grow from our efforts in reprocessing for quicker turnaround time to better meet customers’ needs. Total deposit declined by 7% from last year, in line with our strategy to balance deposit and loan volume, hence Loan to Deposit ratio (LDR) stood at 99%. TMB continued to focus on growing transactional deposits and successfully expanded transactional retail deposit franchise, led by All Free deposits which alone grew THB 20,000 million. In 2016, the ratio of transactional deposit to total deposit continued to increase from 37% to 40%.”
Net interest income (NII) grew by 7%, supported by higher NIM of 3.17% from 3.02%. Fee income rose by 2%, after being impacted by the fall of 32% in commercial loan related fees along the line of the commercial loan volumes. Nonetheless, retail fees continued with a robust growth of 13% from bancassurance and credit card fees which grew by 32% and 65% respectively as the Bank continued to deliver products that better answer the need of customers.
The Bank’s total revenue rose by 5% from previous year to THB 35,223 million, while Bank’s operating expense only grew 1% to THB 16,589 million from further efficiency improvement. As a result, the PPOP grew 10% from last year to THB 18,667 million,
TMB remains prudent amid weak economic recovery and set additional provisions to accommodate extra write-offs to reduce future downside risks. Consequently, NPL ratio declined from 2.99% to 2.53% and the amount of NPL was reduced to THB 17,605 million, a reduction of THB 2,868 million from last year. In 2016, the Bank set aside relatively high provision of THB 8,649 million, an increase of 58% from previous year, with the strong coverage ratio of 143%. Due to higher provision this year, net profit is reported at THB 8,226 million, a decline of 12% from previous year.
The Bank continued to maintain high capital levels under Basel III framework. Capital adequacy ratio (CAR) increased to 18.14% and Tier 1 ratio increased from 11.3% last year to 12.80% which remained higher than the Bank of Thailand’s minimum requirement of CAR at 9.125% and Tier 1 at 6.625%, respectively.
Mr. Boontuck also added, “In 2016, TMB operated with prudence and continued to grow operating profit. This year, the Bank aims to deliver products that meet demand of the customers and also continue to enhance operating efficiency with “Digital Banking” that empowers customers to make the most of their lives.”