Thai Credit Retail Bank (TCRB) aims for 15% growth in its loans outstanding this year based on strong demand for microfinance.
The bank's loan portfolio is expected to reach 52 billion baht by year-end from 45.2 billion a year earlier, said chief executive Winyou Chaiyawan.
It is aiming for 20 billion baht in new loans this year, of which 15 billion have been extended, he said.
The bank's main businesses are microfinance and nanofinance. It offers financial support to small enterprises with an average credit line of 2-3 million baht each. The bank's nanofinance centres on vendors with credit lines of around 50,000 to 60,000 baht per borrower.
Its interest rate for microfinance is based on the minimum retail rate, while the nanofinance ceiling rate is capped at 36% per year to comply with regulations.
The Finance Ministry's efforts to widen formal financing sources for low-income earners and informer workers is to help them avoid underground lending, in addition to encouraging loan sharks to enter the formal lending system. Regulations allow nanofinance operators to lend only for occupational purposes, with a lending limit of 100,000 baht per borrower and a ceiling interest rate of 36% a year.
The bank plans to expand its loan portfolio, customer base, staff, and networks to prepare for business growth next year, Mr Winyou said. Digitisation is another key for the bank as it expands.
"TCRB is likely the only bank offering fully licensed micro- and nano-lending services. Over the past five years, we delivered strong business growth in all areas and this should continue," he said.
The bank's loan growth averaged 16% per year over the past five years, with customer growth of 12%. The bank posted net profit of 531 million baht last year and targets 700 million this year.
Its gross non-performing loan ratio is now higher than 5% and it wants to reduce it below 5% by year-end, said managing director Roy Agustinus Gunara.
TCRB has 174,000 customers, of which 140,000 are nanofinance clients and the remainder microfinance. The bank has 316 branches nationwide, comprising 21 for funding mobilisation and 295 for lending.
Funding branches take deposits, and offer bancassurance and banking transactions, targeted at urban customers, while lending branches are mainly located in communities.