BBL maintains NPL caution despite better asset quality
Bangkok Bank (BBL) is keeping its guard up with plans to set aside loanloss provisions this year at the same level as last year to cope with global economic uncertainties, despite improving asset quality.
Against the backdrop of global volatility, the bank wants to reinforce its financial cushion, said president Chartsiri Sophonpanich.
In 2019, BBL aims to maintain loan provision for credit loss at the same amount as in 2018, at about 22 billion baht, and keep a lid on non-performing loans (NPLs) at 3.4% of loans outstanding by year-end, Mr Chartsiri said, noting that the bank’s bad-loan ratio has been steady since the start of this year.
BBL’s ratio of distressed loans fell from 3.9% in 2017 to 3.4% in 2018.
“Despite improving asset quality, the bank will keep a high buffer to prepare for several uncertainties,” Mr Chartsiri said.
The bank remains optimistic about the country’s economic growth, predicting a 4% expansion this year on the strength of Thailand’s strong economic fundamentals and big-ticket infrastructure development.
Assuming 4% economic growth, the Thai banking sector will show positive loan growth of 4-6% on average this year, Mr Chartsiri said.
BBL aims for 6-7% growth in corporate lending, 4-5% in small and medium-sized lending, 4-6% in retail lending and 4-5% in international banking.
Yesterday BBL announced the eight fintech teams that won the final round of its accelerator programme, Bangkok Bank InnoHub Season 2.
The programme began with 128 tech startup teams from 28 countries 12 weeks ago.
Mr Chartsiri said the bank has been adopting technology and digital banking to keep pace with customer needs in the digital age.
The adoption covers entire business areas and all customer segments, as well as operational systems and financial services.
The bank’s new technology adoption and digital banking growth will be gradual, Mr Chartsiri said.
The security system is a key focus point i n building consumer confidence.
Partnership is a key strategy in building fintech in Thailand through the accelerator programme. Under the programme, the bank focuses on five key themes: creating a unique customer experience; digitisation and automation; future SME solutions; innovative payment; and discovering cutting-edge technologies.
Of the eight finalists, three are in the scoping stage with the bank, three are undergoing proof of concept and two are in the pilot stage.