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BANGKOK, 18 January 2018 - TMB Bank Public Company Limited and its subsidiaries today announced 2017 financial performance which showed continued improvement from previous year. The Bank’s pre-provision operating profit was THB19,736 million, a 6% increase year over year. The Bank remained prudent and set aside THB8,915 million of provision, an 3% increase from previous year while NPL ratio dropped to 2.35% from 2.53%. NPL coverage ratio therefore remained high at 143%. After provision and taxes, TMB reported net profit of THB8,687 million, representing 6% growth.
Mr Piti Tantakasem, CEO of TMB Bank, said “TMB has always focused on delivering “need-based” and “simple and easy” products and services to customers as well as prudent management of asset quality. Loans grew by 8% in 2017. Such a growth came primarily from retail lending backed by continued growth in mortgage as the Bank improved its process for more efficient turnaround time. In terms of commercial segment, corporate loan continued to grow while SME loan was still slowdown. However, the Bank saw recovery signs of SME in the fourth quarter.”
“On the deposit side, TMB continued to focus on growing retail deposits base by offering All Free, transactional deposit and No-Fixed, non-transactional deposit to customers. The successful expansion of transactional retail deposit franchise was reflected by All Free deposits which grew by 51% or THB18 billion and No-fixed deposits which expanded by 16% or THB33 billion. Overall, total deposit expanded 2% from last year, in line with the Bank’s liquidity management.
Net interest margin, however, declined slightly from 3.17% to 3.13% as SME loan which offered high yield was still underperformed compared with last year. Net interest income therefore was flat at THB24,734 million. Non-interest income on the other hand was THB12,705 million or grew by 21%. Key revenue driver was a 32% increase from net fee and service income, boosted by 76% robust growth of mutual fund fees and 71% of bancassurance fees.
Mr Piti added that “continued improvement of fee income reflected that TMB was on the right direction in delivering products and services that meet needs of customers as well as improving services across all channels. This year, for instance, TMB launched new services in addition to TMB Open Architecture”, the Bank’s mutual fund platform that selects and offers customer top-performed mutual funds from 8 leading asset managements. TMB provided TMB advisory, an investment advisory service via VDO conference and a mutual fund trading feature on TMB Touch to serve customers’ digital lifestyle.”
Overall, TMB generated THB37,439 million of total revenue, an increase of 6% from 2016. Operating expenses was THB17,792 million or rose 7% due mainly to marketing and business volume-related expenses. Consequently, the Bank recorded pre-provision operating profit of THB19,736million or 6% improved from previous year. TMB therefore had an ability to raise its loan loss buffer by provide more provision while NPLs dropped further.
In 2017, the Bank set aside provision of THB8,915 million, a 3% higher than the prior year. Coverage ration therefore remained high at 143%. NPLs reduced THB84 million to THB17,521 million and NPL ratio was lower from 2.53% to 2.35%. After provision and tax, the Bank reported net profit of THB8,687 million, a 6% increase from previous year.
In addition, the Bank continued to maintain strong capital levels. Capital adequacy ratio (CAR) and Tier 1 ratio under Basel III framework stayed at 17.3% and 13.2%, which are higher than the Bank of Thailand’s minimum requirement of CAR at 9.75% and Tier 1 at 7.25%, respectively.
Mr Piti concluded, “Improving operating performance in 2017 reflected the results of our focus in delivering products and service that meet needs of the customers under the philosophy of “Need-based Bank” and “Simple & Easy”. In 2018, TMB aims to expand transaction deposit through retail and small SME customer base. Digital capability will also be enhanced to better serve growing digital banking customers together with prudent management of asset quality to ensure quality and sustainable growth.”