CIMB Thai Bank is aiming for twenty percent growth in 2016 in fees from underwriting bonds, merger advice and investment products, in a move towards non-interest revenue as desire for credit in Thailand eases, according to its CEO.
Thailand’s economy is currently underperforming other countries in the region as consumers and firms pay off debts racked up in recent years. Growth is forecast at just over three percent this year, an increase from 2.8 percent in 2015.
“The economy will continue to be quite sluggish”, said CIMB Thai Chief Executive Subhak Siwaraksa, speaking with news agency Reuters on Thursday. “We have adjusted our business strategy. You have to recognise that as a bank now we do more than loans”.
CIMB Thai Bank, a division of Malaysia’s CIMB Group Holding Bhd, is the ninth biggest lender in Thailand by assets.
Income from the non-interest side of the bank’s business made up around forty percent of the total, says Subhak. The bank is one of the top two bond underwriters in Thailand with around half of the market in structured products, he said.
CIMB Thai expects to grow its retail loan business by ten percent this year and corporate loans by between ten and fifteen percent, he said, despite the country’s sluggish economic growth.
The bank’s bad loan portfolio is expected to reach a peak in 2017 at four percent, he said, up from under three percent now.
SOURCE: Reuters via Yahoo News.