Bangkok Bank posts $606M net profit

Bangkok Bank increased its net profit in 2009 by 0.02 percent to US$606 million.  Profit before provisioning and tax amounted to US$1.085 billion, 0.7 percent higher than 2008.

The bank was able to maintain its operating results when the economy began to recover in the final quarter of 2009, following the recessionary period that had started in the fourth quarter of 2008. Contributing to the result were the bank’s strong fundamentals and financial strength, and its ability to achieve its four major targets: maintaining a healthy level of liquidity, increasing fees and service income, looking after loan quality, and maintaining a solid capital position.

"Throughout 2009 we concentrated on working closely with our customers. This approach allowed us to provide appropriate and timely financial support so that our customers could operate their businesses smoothly, both when difficult economic conditions were difficult and when the economy began to improve," said Bangkok Bank President Chartsiri Sophonpanich.

The bank's total loans in the fourth quarter of 2009 rose by US$ 327 million, or 1.0 percent, from the end of the third quarter. Total outstanding loans fell by 6.0 percent over the full year, an improvement from the 6.9 percent decline in the nine months to September 30, 2009, reflecting the start of the economic recovery. If loans of the bank's former branches in China – which have now been transferred to Bangkok Bank China – had been included, total outstanding loans would have risen by 3.9 percent in the fourth quarter. Total outstanding loans for the whole year would have declined by 3.3 percent.

The bank successfully grew its deposit base and achieved its objective of maintaining a healthy level of liquidity. Deposits rose by US$954.8 million, or 2.4 percent, from the end of 2008 to US$40 billion as of December 31, 2009. The loan-to-deposit ratio stood at 82.0 percent.

Fees and service income in 2009 rose by US$48.4 million or 9.5 percent, in line with the bank's major targets. The increase was due to greater contributions from several products and services, including electronic transactions, deposit-related services, bancassurance, mutual funds, and investment banking operations.

"The increased fees and service income resulted from Bangkok Bank's ability to satisfy customers' needs by providing a wide variety of financial products and services, and extensive networks, supported by staff's ability to match these needs with the appropriate offerings," said Mr. Chartsiri.

In a challenging business environment, the bank was able to control its operating expenses well with an increase of 2.0 percent year-on-year.

The bank's focus on maintaining close relationships with customers and practicing a cautious lending policy resulted in the bank's non-performing loans declining from US$1.65 billion at the end of 2008 to US$1.63 billion at the end of 2009. The ratio of NPLs to total loans at year-end was 4.4 percent.