KUALA LUMPUR (April 21): CIMB Group Holdings Bhd’s (KL:CIMB) 94.83%-owned subsidiary CIMB Thai Bank PCL posted an 8.4% increase in net profit for the first quarter, driven by lower expected credit losses and operating expenses.

The eighth-largest bank in Thailand by assets is listed on the Stock Exchange of Thailand.

Net profit rose to 908.2 million Thai baht (about RM112.09 million) for the three months ended March 31, 2026 (1QFY2026), from 838.1 million Thai baht (about RM103.46 million) a year earlier.

Expected credit losses fell 21.1% year-on-year to 654.03 million Thai baht, while operating expenses edged down 0.6% to 1.7 billion Thai baht, mainly due to lower employee-related costs.

Operating income declined 3.1% year-on-year to 3.47 billion Thai baht, attributed to a contraction in net interest income, which fell 7.1% amid lower asset yields in line with the prevailing low interest rate environment, according to CIMB Group’s filing with the stock exchange.

Despite a more uncertain operating environment, CIMB Thai remains committed to delivering resilient returns through deeper customer engagement, increased cross-selling across its core segments, and continued discipline in risk management, said CIMB Thai president and chief executive officer Wut Thanittiraporn in a statement.

The bank continues to make steady progress in executing CIMB Group’s Forward30 strategy, with a clear focus on strengthening its balance sheet, enhancing its deposit franchise, and driving quality growth, he added.

“As part of CIMB Group’s Asean network, CIMB Thai is well-positioned to capture regional flows and support our customers’ evolving needs, in line with our purpose of Advancing Customers and Society,” he concluded. 

CIMB Thai’s net fee and service income declined 22.7%, weighed down by lower insurance brokerage income and underwriting fees. The cost-to-income ratio rose to 48.9% from 47.6% previously, though this was partly offset by a 12.6% increase in other operating income, driven by gains on investments.

Net interest margin (NIM) over earning assets stood at 1.96% for the quarter, slightly lower than 2.04% previously, mainly due to policy rate cuts that compressed asset yields. This was further pressured by loan contraction, though partly mitigated by lower funding costs.

As at end-March, total gross loans (including loans guaranteed by other banks and loans to financial institutions) stood at 236.6 billion Thai baht, up 1.6% from end-December last year. Deposits (including bills of exchange, debentures, and selected structured deposit products) stood at 286.9 billion Thai baht, down 4.8% from 301.5 billion Thai baht as at end-December.

Gross non-performing loans (NPLs) stood at five billion Thai baht, with the gross NPL ratio improving to 2.1% from 2.2% as at end-December.

The loan loss coverage ratio rose to 178.0% from 171.5%, while total allowance for expected credit losses stood at 8.8 billion Thai baht, 1.5 billion Thai baht above the Bank of Thailand’s reserve requirements.

Total consolidated capital funds stood at 58.6 billion Thai baht. The Bank for International Settlements (BIS) ratio was 19.6%, of which 15.2% comprised Tier-1 capital.