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FINANCE
SOMRUEDI BANCHONGDUANG
KTB Leasing has cut back its lending activity over several months due to concerns about rising bad loans, said chairman Preecha Phukham.
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| Preecha Phukham, chairman of KTB Leasing, offers a smile at an exhibition marking the company’s third anniversary. More than 500 brand items will be sold at discounted prices and special lease terms this month at Krung Thai Bank headquarters. PHRAKRIT JUNTAWONG |
Mr Preecha said the slowing economy and the global financial crisis boded ill for the consumer finance industry.
KTB Leasing, a unit of Krung Thai Bank, will slow its lending activity in 2009 and focus more on consumer product hire-purchase lending.
Auto loans and consumer product hire-purchase loans each contribute about 30% of KTB Leasing's 13-billion-baht loan book. The company expects consumer loans to rise to over 50% of total loans over the next few years, with car loans declining in 2009.
Mr Preecha said Krung Thai Bank branches have been playing a greater role this year in screening customers and marketing products.
KTB Leasing, which marked its third anniversary yesterday, projects a pre-provision profit of 250 million baht this year and a net profit of 100 million.
Despite the difficult environment, Mr Preecha forecast that new lending would reach 10 to 12 billion baht this year - new loans of seven billion baht having already been made in the first nine months. Total loans are projected to reach 15 billion baht by December.
For 2009, the company has a loan growth target of 40%, an objective considered achievable due to a relatively small base.
KTB Leasing president Pinyawat Chantrakantanond said the company aimed to rank among the country's top consumer lenders within the next few years.
"Krung Thai Bank will help us achieve our goal. Right now, we are tapping only 100,000 accounts out of the 13 million accounts at the bank," he said.
Mr Pinyawat said the company's pricing was a key competitive advantage, with hire-purchase loans priced at 30% to 40% below market rates thanks to support from Krung Thai Bank.
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