KUALA LUMPUR (July 21): CIMB Group Holdings Bhd’s (KL:CIMB) majority-owned subsidiary CIMB Thai Bank PCL posted a more than fivefold increase in net profit for the second quarter, driven by sharply lower-than-expected credit losses and higher operating income.

Net profit rose to 886.3 million Thai baht (RM107.8 million) for the three months ended June 30, 2026 (2QFY2026), from 174.5 million Thai baht a year earlier, a bourse filing showed.

Operating income rose 21.1% year-on-year to 2.63 billion Thai baht, supported by a 35.2% increase in net interest income to 1.37 billion Thai baht and a 16.7% rise in net fee and service income to 352.3 million Thai baht.

Expected credit loss fell 76.3% year-on-year to 104.9 million Thai baht, while operating expenses declined 4.5% to 1.51 billion Thai baht.   

For the six months ended June 30, 2026, CIMB Thai’s net profit increased 47% to 1.49 billion Thai baht from 1.01 billion Thai baht a year earlier.

CIMB Thai president and chief executive officer Wut Thanittiraporn attributed the stronger first-half performance to higher operating income, tighter cost control and lower provisions for potential loan losses.

CIMB Thai, a top 10 bank in the country, saw operating income rose 9.8%, while operating expenses edged down 0.9% and expected credit losses fell 30.4% from a year earlier.

The net interest margin over earning assets stood at 2% for the first half of 2026, up slightly from 1.9% a year earlier, as lower funding costs offset pressure from lower asset yields.

As at end-June, total gross loans (including loans guaranteed by other banks and loans to financial institutions) stood at 242.2 billion Thai baht, up 4.1% from end-December 2025. Deposits (including bills of exchange, debentures and selected structured deposit products) increased 2.6% to 309.2 billion Thai baht from 301.5 billion Thai baht.

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

The loan loss coverage ratio increased to 179.3% from 171.5%, while total allowances for expected credit losses stood at 8.9 billion Thai baht, 1.5 billion Thai baht above the Bank of Thailand's reserve requirements.

Total consolidated capital funds stood at 59.4 billion Thai baht. The Bank for International Settlements ratio was 19.7%, of which 15.4% comprised Tier 1 capital.