Krungthai Card Plc (KTC) expects its profit to reach another record in 2023 on bets that a tourism boom and the upcoming general election campaign will accelerate consumption and an economic recovery.
The country’s biggest credit-card company has seen “stellar growth” in spending of about 2.5 million credit-card customers so far this year, said chief executive officer Rathian Srimongkol. Demand for consumer loans is also rising amid a rebound in economic activities, he said.
“There has been revenge spending by our customers after some years of pandemic-related business and travel restrictions,” Rathian said in an interview this week.
“More cash will flood into the economy ahead of the election, when politicians will boost their spending on posters, campaign and other activities to win the votes.”
KTC in January reported a record full-year net profit of 7.08 billion baht in 2022, a 20.4% increase from a year earlier. As of the end of the year it had total outstanding loans of 104 billion baht, up 12.5% from the previous year.
The economy is being helped this year by the return of foreign tourists in droves, with arrivals topping 2 million for a second straight month in January. It may also benefit from spending on the general election, expected to take place in May.
Still, KTC adopts a cautious practice in approving new credit cards and consumer loans as the economic recovery remains fragile with high inflation, interest rate increases and risks of a global economic slowdown, according to Mr Rathian.
The company’s shares have declined 9.8% so far this year compared with a 6.8% fall in the benchmark SET Index and a 15% drop in the financial company index.