State-owned GH Bank (GHB) has set a conservative new housing loans target of 141 billion baht this year, 2 billion below last year, because of economic uncertainty — despite its anticipation of an improvement in the property market.
The bank forecast the property market will expand 5-6% this year, assuming the country's GDP grows 3-5%, said president Angkana Chaimanat.
Angkana: 9.3 billion baht net profit target
The residential market in Greater Bangkok is expected to continue growing, underpinned by the government's planned electric train construction, while condominiums in provincial areas would cool down, she said.
Upcountry contributed the biggest slice of GH Bank's new loans last year at 66%, and Bangkok and environs made up the rest. The bank focused on upcountry areas to cash in on the fast-growing residential market there, along the border in particular.
The vibrant economic expansion in Cambodia, Laos, Myanmar and Vietnam led to buoyant border trade as well as gains in investment and property markets in these countries. The Thai government's plan for double-track rail and high-speed trains to link the country with the region triggered a boom in the provincial real estate market.
The bank's new loans in 2014 rose by 15.8 billion baht from the previous year to 143 billion, of which 46.7% was debtors who borrowed less than 1.5 million each. New loans exceeded the bank's target of 134 billion baht.
GH Bank's loans outstanding rose by 7.85% to 794 billion baht last year.
The bank targets total loans increasing by 40 billion baht to 835 billion at the end of this year.
However, Mrs Angkana said it aimed for net profit to reach 9.3 billion baht this year, up from 8.58 billion last year.
GH Bank's deposits are expected to increase by 49 billion baht this year, down from a 52.4 billion rise in 2014.
The bank's non-performing loans are estimated to rise slightly to 5.75% of loans outstanding at the end of 2015, up from 5.36% or 42.6 billion baht last year. GH Bank's bad loan ratio stood at 6.12% at the end of 2013.