CIMBT on course to meet loan target

CIMBT on course to meet loan target

CIMB Thai Bank (CIMBT) is confident of achieving the 2013 loan growth target of 20 billion baht for mortgages and personal loans combined despite more stringent loan approval criteria.

Of the target, 5 billion baht is personal loans and the rest is housing loans, senior executive vice-president Adisorn Sermchaiwong said yesterday.

As of the end of last month, CIMBT extended 4 billion baht in personal loans and 12 billion in mortgages.

Loans outstanding was 160 billion baht while deposits were at 160 billion baht at that time.

In light of the economic slowdown which may erode debtors' service ability, the bank has tightened the debt service ratio but maintained personal loans' credit line at 3-5 times of salary when considering loans. Worries over the ballooning household debt have mounted following disappointing economic data in the first half on anaemic domestic demand and private investment, as well as weak demand in the West.

According to the Bank of Thailand, household debt reached 8.87 trillion baht in the first quarter this year, representing around 77% of the country's gross domestic product.

Mr Adisorn, however, is optimistic that credit growth this year remains solid as unemployment rate at the moment is still low, at less than 1%, and workers' salary has not been cut, despite the lacklustre economy.

He said CIMBT's deposits increased by 17 billion baht during the first eight months this year, 8 billion of which was derived over the past two months.

As for its insurance business, the bank joined hands with Thai Life Insurance yesterday in launching a new life insurance product to be sold exclusively through CIMBT's branches across the country.

The product comes in three types _ gold with the insured sum of 150,000 baht, platinum (300,000 baht) and preferred (750,000 baht).

He said the bank targets insurance premiums sold through its branches at 1.2 billion baht this year, up 30% from 900 million baht last year.

The 30% growth in premiums is also set for next year, said Mr Adisorn.

Shares of CIMBT closed on the Stock Exchange of Thailand at 1.85 baht yesterday, up 1 satang, in trade worth 977,000 baht.

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