TMB Announces Second Quarter Results

TMB continued to expand its customer base and ensure the quality of business growth. The Bank’s 2Q19 operating performance, both revenue generation and efficiency, showed an improvement from the first quarter with Net Profit of THB1,917 million, up 21% QoQ.


TMB Bank Public Company Limited today announced its financial results for the second quarter of 2019 (2Q19). Mr. Piti Tantakasem, CEO, commented on the results that “the Bank’s operating performance showed an improvement quarter-on-quarter (QoQ). The Bank generated Pre-Provision Operating Profit (PPOP) of THB 4,720 million, up 25% QoQ. Key drivers were a continued growth in Net Interest Income (NII) and better Non-Interest Income (Non-NII), together with well-delivered operating efficiency. In terms of asset quality, TMB has monitored it closely and continued to improve the quality of its loan portfolio. Consequently, the Bank set aside THB2,490 million of provision in 2Q19. Net profit after provision and tax therefore was reported at THB1,917 million, an increase of 21% QoQ.

Mr. Piti mentioned further that “In terms of balance sheet growth, the Bank has focused on expanding its deposit base through retail customer segment. The Bank has grown new loans selectively and also continued to de-risk its current loan portfolio to improve portfolio quality. The aim is to strengthen financial position in order to support the potential merger transaction.”

In details, retail deposit which is the Bank’s focus still showed good growth and for the first 6 months of this year, retail deposit expanded by THB3.4 billion or +0.8% from last year (YTD). The growth was led by flagship products namely transactional deposit – TMB All Free, non-transactional deposit – TMB No Fixed and a digital saving, ME Save by TMB which grew +3.3%, +1.7% and +4.8% YTD, respectively. Nonetheless, due to the outflow from commercial deposit by THB4.2 billion or declined by 2.1% YTD, total deposit was reported at THB649 billion, down when compared to THB650 billion at the end of last year.

On the loan side, total loan outstanding at the end of 2Q19 was THB680 billion, down from THB686 billion last year. The decrease was due to loan repayment from large commercial customers combining with a result of de-risking activities especially in medium sized SME segment. Retail loan portfolio, on the other hand, grew further from previous quarter, boosted by mortgage lending. Overall for the first 6 months, the Bank saw a 6.4% growth in retail loans and a 7.7% growth in mortgage. In addition, the new booking of small SME remained on a gradual recovery as the Bank remained selective on originating new loans.

In terms of revenue which showed a QoQ improvement, TMB posted Net Interest Income (NII) of THB6,344 million, a 1.7% growth from 1Q19. NIM was at 2.90%, compared to 2.89% in the previous quarter. Non-Interest Income was THB2,548 million or up 11.8% as fee income started to recover, especially mutual fund fees. Total operating income therefore recorded at THB8,892 million, up 4.4% QoQ. Meanwhile, total operating expenses was THB4,210 million, down 11.1% from 1Q19 in which there was a one-time set-up of employee retirement benefit according to the revision of the Thai Labor Protection Act. From better revenue and lower operating expenses, Pre-Provision Operating Profit (PPOP) increased to THB4,720 million or by 24.5%. After the provision of THB2,490 million and tax, Net Profit was reported at THB1,917 million or rose by 21.4%

In terms of asset quality, the Bank reported NPL ratio of 2.74%, down from 2.81% in the previous quarter. NPL coverage ratio which reflects loan-loss absorption ability stayed at 140%. The Bank maintains its 2019 asset quality targets with NPL ratio of less than 2.9% and NPL Coverage ratio of above 140%.

Lastly, capital adequacy ratio (CAR) and Tier 1 ratio for 2Q19 stayed at 21.1% and 13.9%. The figures were in line with Basel III framework and higher than the Bank of Thailand’s minimum requirement of CAR at 11.0% and Tier 1 at 8.5%.