The Thai Bankers’ Association (TBA) is preparing to discuss additional measures aimed at enhancing funding access for retailers and small and medium-sized enterprises (SMEs) in response to the government’s requests.
Kattiya Indaravijaya, the chief executive of Kasikornbank (KBank), indicated that the discussions among banks are in line with Finance Minister Pichai Chunhavajira’s call for financial institutions to expedite loan approvals and lower costs for businesses in need of credit.
However, Ms. Kattiya mentioned that banks are awaiting further details from the government concerning additional support measures for SMEs, such as assistance with loans, potential relaxation of the loan-to-value (LTV) ratio for mortgage loans, and the existing “You Fight, We Help” debt relief program.
The TBA is set to hold a board meeting on Tuesday, which the Finance Minister plans to attend. Mr. Pichai recently stated that the economy is beginning to recover, creating an opportune time for lending growth.
Regarding SME loans, Ms. Kattiya noted that KBank is prepared to extend additional credit lines and provide debt restructuring assistance to existing clients rather than focusing on acquiring new ones. With a projected softer economic growth rate of 2.4% for the year, as per the Kasikorn Research Center, the bank aims to grow new loans selectively and cautiously.
KBank, Thailand’s third-largest lender by total assets and a leader in SME financing, has set a flat loan growth target for 2025 after achieving only 0.57% growth last year. The bank also anticipates an increase in its non-performing loan ratio, reaching up to 3.25% this year compared to 3.18% in 2024.
For the first quarter of this year, KBank expects to maintain flat loan growth year-on-year. Under its selective lending strategy, mortgage and credit card loans are expected to be the primary drivers of loan expansion, while corporate loans are projected to grow from the second to third quarter, she noted.
If the Bank of Thailand approves the relaxation of the LTV ratio as requested by property developers, it could help homebuyers access housing loans. However, KBank plans to wait for more information on this potential change before evaluating its effects on mortgage loan growth.
Additionally, Ms. Kattiya emphasized that KBank is doing its utmost to support customers in restructuring their debts through the You Fight, We Help program. Although the number of qualified clients registering for the program has not yet met targets, there are signs of improvement.
In a related announcement, KBank informed the Stock Exchange of Thailand that it will propose a special dividend payment for approval at an extraordinary general meeting of shareholders on May 7, with a payout of 2.50 baht per share.
“The bank’s shareholders are more focused on receiving an appropriate return on investment rather than just loan growth. We are also considering adjusting our dividend payout ratio, which was previously 25%, to 37% in 2024,” she added.
