Although Thailand's economy continues to recover, there are still other factors which might either pose a significant risk or present opportunities or challenges to the business. We have witnessed since the beginning of the year global financial market volatility towards high interest rate trend, ongoing geopolitical issues, changes in consumer behavior and lifestyle, business remodels to better serve the digital era post Covid-19, and last but not least, the increasing global focus on ESG. Bangkok Bank is aware of the challenges our customers are facing in their businesses and continues to support and advise them on how to adapt their business models to the changing environment, and provide support in relation to international business expansion and new investments in environmentally-friendly economic activities in order to create a long-term sustainable ecosystem.
Bangkok Bank reported Baht 32,773 million for the nine months of 2023
The Bank and its subsidiaries reported a net profit for the nine months of 2023 of Baht 32,773 million, an increase of 50.8 percent from the same period last year, primarily due to an increase of 33.3 percent in net interest income in line with the interest rates trend. An increase in yield on earning assets was offset by a gradual increase in cost of deposits and the resumption of the Financial Institutions Development Fund (FIDF) fee to the normal rate since the beginning of 2023, resulting in a net interest margin of 2.96 percent. Net fees and service income was at a similar level to the same period last year. Operating expenses increased by 16.4 percent in line with economic activities and partially from expenses for operational efficiency improvement. The cost to income ratio was lower to 46.4 percent. According to consistently setting aside expected credit losses, the Bank provided expected credit losses at a similar level to the previous quarter. As a result, the Bank's expected credit losses for the nine months of 2023 was Baht 26,323 million.
With a prudent management approach, Bangkok Bank maintains a healthy financial position, high liquidity and capital positions for strong and sustainable growth
At the end of September 2023, the Bank's total loans amounted to Baht 2,723,751 million, an increase of 1.5 percent from the end of last year, mainly due to an expansion in loans to large corporate customers and loans made through the Bank's international network. The ratio of non-performing loan to total loans remained manageable at 3.0 percent. As the Bank continues to set aside expected credit losses in line with its prudent approach, the ratio of allowance for expected credit losses to non-performing loan remained solid at 283.3 percent.
As of September 30, 2023, the Bank's deposits amounted to Baht 3,163,297 million, a decrease of 1.5 percent from the end of 2022. The loan to deposit ratio stood at 86.1 percent. In terms of capital, the capital adequacy ratio, Tier 1 capital adequacy ratio, and Common Equity Tier 1 capital adequacy ratio of the Bank and its subsidiaries stood at 19.6 percent, 16.2 percent and 15.4 percent respectively, comfortably above the Bank of Thailand's minimum capital requirements.
Source: Bangkok Bank