CIMB Group Holdings Bhd’s 94.83% indirectly held subsidiary, CIMB Thai Bank PCL, posted a 24.3% increase in net profit of 3.03 billion baht (RM396.31 million) in the financial year ended Dec 31, 2022.
CIMB Thai president and CEO Paul Wong Chee Kin (picture) in a statement said the improvement was mainly owing to better cost control and a significant 39.4% decrease in expected credit losses due to a lower impairment of assets despite a marginal decrease in operating income.
CIMB Thai’s operating income dropped 2.9% year-on-year (YoY) to 13.75 billion baht in 2022 due to a contraction in net interest income, while other operating income was 3.9% lower due to a decrease in gains on sale of investments. However, this was partially offset by a 3.4% increase in net fee and service income.
Wong said operating expenses remained flat from continued cost management, while the cost-to-income ratio was higher at 57.1% compared to 55.5% in 2021 due to lower operating income.
The bank’s net interest margin over earning assets stood at 2.7% in 2022 compared to 3.1% in 2021, due to higher cost of funds and lower loan yields.
As at Dec 31, 2022, total gross loans (inclusive of loans guaranteed by other banks and loans to financial institutions) stood at 235.3 billion baht, an increase of 11% YoY.
Deposits (inclusive of bills of exchange, debentures and selected structured deposit products) stood at 289.7 billion baht, an increase of 21% from 239.5 billion baht as at end-December 2021.
The modified loan-to-deposit ratio decreased to 81.2% from 88.5% as at Dec 31, 2021.
Gross non-performing loans (NPL) stood at 7.8 billion baht with a lower equivalent gross NPL ratio of 3.3% compared to 3.7% as at Dec 31, 2021.
“The lower NPL ratio was mainly due to the sale of some NPLs in 2022, as well as improved efficiency in risk management policies, asset quality management and loan collection processes,” said Wong.
CIMB Thai’s loan loss coverage ratio stood at 114.6% as at Dec 31, 2022, from 117.5% at the end-December 2021.
According to Wong, total allowance for expected credit losses stood at 8.2 billion baht, 1.5 billion baht over the Bank of Thailand’s reserve requirements.
Total consolidated capital funds as at Dec 31, 2022, stood at 57.6 billion baht, whilst Bank for International Settlements’ (BIS) ratio stood at 21.8%, of which, 16.1% comprised Tier-1 capital. — TMR / pic source: cimbthai.com