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Profits at top banks fall more than 50% in 3rd quarter


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19 hours ago, snoop1130 said:

The five banks showing the biggest third-quarter profit drop were CIMB Thai Bank – down 77 per cent to Bt81 million; Siam Commercial Bank – down 68.9 per cent to Bt4.64 billion;

 

Bangkok Bank – down 57.4 per cent to Bt4.01 billion; Krungthai Bank – down 51.9 per cent to Bt3.05 billion; and Kasikorn Bank – down 32.8 per cent to Bt6.67 billion.

however they all still show profits, will not feel sorry for any of them.... but do feel for the small business with NO profit at all

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Oh dear, bad loans are 3x the banks reserves ........ that can't be good.

I seem to remember a story from last week saying CIMB is closing all it's ATMs. Probably to cut costs, and maybe to limit withdrawals if a run starts. I'd be moving my money out, if I were a

Worth reading: https://www.reuters.com/article/us-thailand-economy-debt/buyers-of-thai-distressed-assets-plan-big-purchases-as-debt-payment-holiday-ends-idINKBN27719E   About 6.89 trillion b

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On 10/23/2020 at 11:35 AM, xylophone said:

A great proportion of the "bad loans" will be in property and although the figures look alarming, the assets that they cover can be sold thereby bringing some revenue back to the bank, so not a total loss.

Sold to who, and when?

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5 minutes ago, xylophone said:

Sold at a discount to buyers who look for and buy distressed assets.

Would have to be a big discount, and there are no tenants around.  

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3 hours ago, Leaver said:

Would have to be a big discount, and there are no tenants around.  

Was it just yesterday an asset house buying 12Bn non-performing assets with face value of 40Bn - some people make money out of other peoples' distress always.

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3 hours ago, ExpatOilWorker said:

 

Real-estate or housing is only 20% of the NPL banks hold and most of it is not very attractive.

The right column is showing % of loans going sour and it appears construction and retail are hurting the most with 6-7% NPL.

 

 

 

Screenshot_20201025-070415_Chrome.jpg

Thanks for the info, and I was really considering not just real estate per se, but construction lumped into it in my post as a broad generalisation.

 

The distressed assets in the construction industry could include land and equipment et cetera, but anyhow the whole situation doesn't look to brilliant, and it's quite possible that a lot of the lending done in the construction side of the business was done because of the status of the borrower and construction company rather than them being on a sound financial footing?

 

On a related subject, there is a huge construction site that spans the ground between the road leading to Tesco Lotus in Phuket, and the road leading to Central, and some sort of leisure park is under construction and every time I drive by it there is a little activity, which has slowed down quite markedly, and I often wonder if that will become a casualty of this virus, due to lack of tourists.

 

The "personal consumption" line looks a little worrying and it's been said for a long time that Thais are clocking up personal debt at quite a rate, but I wonder exactly what that line covers as the credit card debt is not particularly high?

 

Overall, not a pretty sight and one has to wonder if a banking crash similar to 1997, could be on the cards??
 

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Most of the drop in profit was attributed to the rise in reserves to cope with debt defaults amid the economic slowdown.

 

Utter drivel. Sure, that is a factor. But, how about a lack of deposits, due to an extreme economic slowdown? How about a drop in interest earnings, due to a slowdown in credit card usage? How about a dramatic drop in applications for mortgages, car loans, and other similar areas? How about a drop in new home construction loans, and loans to developers? How about a dramatic drop in profit from foreign exchange? This article does not even begin to cover the extent of the crisis. 

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1 hour ago, Henryford said:

I bet half the pick ups in Isaan will soon be repossessed.

And my live-in girlfriend's pick-up would possibly be one of them if I weren't making the monthly payments for her. That's her biggest expense for me if we don't count food and some misc.

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2 hours ago, xylophone said:

Thanks for the info, and I was really considering not just real estate per se, but construction lumped into it in my post as a broad generalisation.

 

The distressed assets in the construction industry could include land and equipment et cetera, but anyhow the whole situation doesn't look to brilliant, and it's quite possible that a lot of the lending done in the construction side of the business was done because of the status of the borrower and construction company rather than them being on a sound financial footing?

 

On a related subject, there is a huge construction site that spans the ground between the road leading to Tesco Lotus in Phuket, and the road leading to Central, and some sort of leisure park is under construction and every time I drive by it there is a little activity, which has slowed down quite markedly, and I often wonder if that will become a casualty of this virus, due to lack of tourists.

 

The "personal consumption" line looks a little worrying and it's been said for a long time that Thais are clocking up personal debt at quite a rate, but I wonder exactly what that line covers as the credit card debt is not particularly high?

 

Overall, not a pretty sight and one has to wonder if a banking crash similar to 1997, could be on the cards??
 

 

Personal Consumption is the sum of Housing, Auto, Credit cards and other personal loans. Line 10 is only a subtotal.

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12 minutes ago, ExpatOilWorker said:

 

Personal Consumption is the sum of Housing, Auto, Credit cards and other personal loans. Line 10 is only a subtotal.

Hmmm....if so it is a poorly constructed spreadsheet!!

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14 hours ago, jabis said:

Was it just yesterday an asset house buying 12Bn non-performing assets with face value of 40Bn - some people make money out of other peoples' distress always.

Is the "face value" not 12Bn now?  

 

Sure, some will buy up distressed assets, but if property, I don't expect these assets to increase very much for some years to come, unless the property is used for business purposes, primarily around tourism.   

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1 hour ago, Leaver said:

Is the "face value" not 12Bn now?  

 

Sure, some will buy up distressed assets, but if property, I don't expect these assets to increase very much for some years to come, unless the property is used for business purposes, primarily around tourism.   

I think it is suggested the loans still sit at 40Bn but the banks, or whom ever last creditor was, sold the loans for liquidity of 12Bn, so the new creditor will still try to get 40Bn worth of dosh from the asset debtors, and as they are non-performing and debtor cannot re-finance/negotiate, the new creditor will initiate the reposession of the assets - at least that's how I read the article. For the original creditor, the debts were now only 12Bn "face value" (sidenote; the term was from the article, not my own wording 🙂 ) worth, and wanted to not handle the repo-procedures or renegotiate those debts any further, so chose to dump those NPL's from their balance sheet at the perceived loss of 28Bn. Now on the other hand now that they don't carry 40Bn of NPL's, can go back to issuing even more loans, as they're performing better than ever, lol.     

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