CIMB Thai’s profit falls on higher NPL, expenses incurred

by TMR/ pic by MUHD AMIN NAHARUL

CIMB Thai Bank Public Co Ltd’s net profit sunk 45.1% year-on-year (YoY) on higher non-performing loans (NPLs) and operating and fund costs incurred by the bank, which is 94.83%-owned by CIMB Group Holdings Bhd.

For the second quarter ended June 30 this year (2Q), the bank’s profit came in at 104.93 million Thai baht (RM13.96 million) against the RM191.23 million Thai baht managed in the corresponding quarter last year.

This comes as its gross non-performing loan ratio worsened to 4.5% from slower repayment from corporate and retail accounts and as net interest margins contracted on higher cost of funds.

The Thai-based bank also incurred higher operating expenses during the quarter, predominantly driven by personnel cost.

For the first half of the month, however, net profit for the bank grew 17.9% to 429.93 million Thai baht on higher operating income and the decline in provisions recognised.

In a statement, CIMB Thai said it exercises high standards for credit risk underwriting and risk management, while focusing on improving productivity, monitoring collection and managing all accounts effectively.