Thai banking shares climb as big four's earnings beat estimates

[rooster59]

Thai banking shares climb as big four's earnings beat estimates

By Chayut Setboonsarng

 

A man walk into the Siam Commercial Bank branch in central Bangkok, Thailand, January 23, 2017. REUTERS/Chaiwat Subprasom

 

BANGKOK (Reuters) - Banking shares in Thailand rose on Friday after the country's four biggest lenders all reported second-quarter profit that beat market estimates, as a decision to waive fees for digital transactions had a milder impact than analysts expected.

 

The Stock Exchange of Thailand's banking index <.SETB> ended morning trade up 2 percent, helped by a 4 percent surge in the share price of the country's third-biggest lender by assets, Kasikornbank PCL <KBANK.BK>.

 

Earlier in the day, Kasikornbank reported a 21 percent rise in April-June profit versus the same period a year prior, helped by 4 percent growth in income earned from interest charged on loans. It said growth in non-interest income slowed to 1.7 percent due to the waiver; analysts were expecting a bigger hit.

 

Thailand's big-four banks from April 1 waived fees on interbank transactions, bill payments and cash withdrawals to firm up competitiveness as technology firms expand into money-related services such as online payment and electronic wallets.

 

The move supports the government's goal of making Southeast Asia's second-largest economy a cashless society.

 

Thailand's No.4 lender, Krung Thai Bank PCL <KTB.BK>, also reported earnings on Friday morning. It booked growth for the first time in four quarters with a 140 percent profit rise versus a year prior when it was hit with steep impairment costs.

 

Net interest income at the state-controlled bank fell 4.8 percent, but net income from fees and services rose 1.3 percent.

Krung Thai Bank's stock was up 0.6 percent at midday.

 

DIGITAL PUSH

 

Banks' offensive against technology upstarts has involved partnerships and hefty investment in digital services. Kasikornbank has 8.4 million people signed up to its internet banking service, and in June, said its customers could make digital payments through Facebook Inc <FB.O> messenger.

 

Second-ranked Siam Commercial Bank PCL <SCB.BK>, which has tie-ups with Line Corp <3938.T> and Alphabet Inc's <GOOGL.O> Google, on Thursday said it aims to have 10 million digital users by the end of 2018 from 7 million at present.

 

The lender reported a 6.7 decline in profit after market close on Thursday, citing expenses in digital technology, and said non-interest income - pulled down by the fee waiver - fell 6.2 percent. The result nevertheless beat analyst estimates, and its shares were up 3.6 percent by midday on Friday.

 

Bangkok Bank PCL <BBL.BK>, Thailand's biggest lender, also reported earnings late on Thursday, saying profit rose 14.3 percent. It said non-interest income soared 19.1 percent due to a rise in fee income from bancassurance and mutual funds.

 

"The domestic economy started to show more visible signs of recovery with solid growth in both private consumption and private investment," the bank said in a statement.

Bangkok Bank's shares were up 1.8 percent on Friday.

 

 

-- © Copyright Reuters 2018-07-21

 

[phantomfiddler]

When you have them by the gonads, the hearts and minds will follow ? Far too great a disparity between the borrowing and lending rates in Thailand !

[connda]

It's all a gravy-train until the non-performing loans hit a brick wall.  Extend credit to over-extended Thais and they'll just keep borrowing.  When they can't pay, get the government involved to act as the loan repayment enforcers. When the financial ponzi scheme blows up world-wide, demand that the Thai government raise taxes and  implement austerity on the poor  to make banks whole again, oh, and take all of your depositor's money too boot.  Then give bank execs a bonus.

[HHTel]

I'm not at all surprised when they charge 220 baht to withdraw money from your foreign bank at an ATM and Thailand is the only country I know that levies a service charge for depositing cash into your account in the same bank (except in the branch that has your account).

 

 

[The Deerhunter]

Well at the interest rates they charge it would be a miracle if they were not very profitable.

[MartinBangkok]

If you have white skin you have to pay on average 2 percentage points higher interest rate than brown skinned Thais...

[macahoom]

8 minutes ago, MartinBangkok said:

If you have white skin you have to pay on average 2 percentage points higher interest rate than brown skinned Thais...

 

Please stop talking nonsense!

[MartinBangkok]

30 minutes ago, macahoom said:

 

Please stop talking nonsense!

You don't believe me?