KTC has weathered the economic slowdown, with consumers exercising caution in their spending. Despite these challenges, our loan portfolio remains stable, with total receivables of 105,803 million baht and 3.45 million member accounts. Our half-year net profit was an impressive 3,629 million baht, and our total NPL has decreased to 1.97%, below the industry average. Our primary objectives remain unchanged: maintaining portfolio quality, increasing profits, providing diverse loan products, and offering fair debt assistance measures.
Mrs. Pittaya Vorapanyasakul, President & Chief Executive Officer, "KTC" or Krungthai Card Public Company Limited, stated, "The consumer finance industry is beginning to slow down with pressure from high level of household debt. However, the Consumer Confidence Index was satisfactory until June 2024. As such, total consumer spending was somewhat growing. KTC's market share of credit card and personal loan receivables (excluding auto title loans) from January to May 2024 was 14.9% and 6.3%, respectively, and the market share of credit card spending volume equaled 12.8%."
"KTC and its subsidiaries' performance for Q2/2024 was stable as the domestic economy was still uncertain. Consumers spend cautiously despite the growing card spending volume. They mainly spend on necessary things. The personal loan portfolio expanded slightly due to higher household debt and strict loan approval criteria. The Company managed its portfolio well, with total NPL lower than the industry and has sufficient reserves with a strong NPL Coverage Ratio of 363.3%."
"KTC's net profit, compared to the same period in 2023, according to separate financial statements in the first half-year and in Q2/2024, equaled to 3,722 million baht (a 2.0% increase) and 1,829 million baht (a 1.3% increase) respectively. According to KTC's consolidated financial statements in the first half-year and Q2/2024, total net profit equaled 3,629 million baht (a 1.3% decrease) and 1,826 million baht (a 1.1% increase), respectively. The Group's total revenue equaled 6,781 million baht, an 8.7% increase from the same period last year, mainly from increased fee income and bad debt recovery. Meanwhile, total expenses increased by 12.8%, totaling 4,497 million baht, partly due to increased fees and services in response to transaction volume. In addition, expected credit losses (ECL) increased from bad debt write-offs and higher provisioning according to the conservative principle to accommodate fluctuations that may occur in the future. Cost of funds also increased in response to higher interest rates in the financial market."
"Despite the current economic climate, KTC is resolute in its strategic plans for 2024. Our goal is to maintain and increase our profits while upholding the quality of our portfolio. We are dedicated to ensuring that our NPL to total receivables is within the target. Moreover, we aim to expand our credit card customer base to include higher-income groups, while also enhancing our portfolio quality for both credit cards and personal loans. We plan to achieve this by adding member acquisition channels through new service points, such as KTC P BERM Car for Cash (One Stop Service), strategically located in target areas to increase product awareness and reach more people in need of loans."
"KTC has implemented various measures based on responsible lending. During the first half of 2024, we found that most of KTC's borrowers could pay the minimum payment of 8%, with only a small portion experiencing difficulty. Responding to the Bank of Thailand Notification No. Sor Kor Chor 7/2566 regarding Responsible Lending (RL), KTC has implemented measures to assist long-term borrowers follows: Credit Card can convert to a 48-month long-term loan, KTC PROUD can convert revolving loan to term loan with repayment for 60 months, KTC CASH can reduce installation payments amount by 30% for three accounting cycles, KTC P BERM Car for Cash can reduce installation payments amount by 30% for three accounting cycles for cars, motorcycles and big bikes or extend installation period to 60 months, 72 months or 84 months depends on vehicle types. Please see www.ktc.co.th/support/rate/table-of-disclosures for more information. The Company has also implemented Severe Persistent Debt (SPD) measures in Q2/2024, effective since April 1, 2024. Some KTC borrowers have participated in the program. The impact on actual interest income was only 1.3% of the estimated total impact value (18 million baht per month) if all eligible KTC borrowers participated in the program."
As of June 30, 2024, compared to the same period in 2023, the total membership base numbered 3,448,530 accounts, while total loans to customers and accrued interest receivables equaled 105,803 million baht (a 0.2% increase); the NPL Ratio was 1.97%, comprising of 2,717,213 cards in the credit card business (a 4.3% increase), and total loans to credit card customers and accrued interest receivables of 69,253 million baht (a 0.9% increase). The credit card spending in Q2/2024 was 70,949 million baht (an 11.5% increase). NPL for credit cards was at 1.42%. There are 731,317 accounts in the KTC personal loan portfolio (a 2.9% decrease), with loans to customers and accrued interest receivables of 34,028 million baht (a 1.9% increase). NPL for personal loans was at 2.21%. "KTC P BERM CAR FOR CASH" receivables equaled 2,699 million baht (a 62.8% increase). KTB Leasing Company Limited (KTBL)'s lease receivables equaled 2,523 million baht (a 28.7% decrease) as KTBL has stopped granting this type of loan since August 2023. KTC is currently focusing on debt collection and managing the quality of existing portfolios.
The group's total borrowings equaled 61,965 million baht, comprising short-term borrowings (including loans and debentures due within one year) 28.0% and long-term borrowings 72.0%. The debt-to-equity ratio was 1.97 times, which decreased from 2.18 times in the same period in 2023 and was lower than the debt covenants, which were ten times. The available credit line was 28,171 million baht (short-term 22,671 million baht and long-term 5,500 million baht). The amount of loans and debentures due in the second half of 2024 equals 7,845 million baht.