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THE GIST
NEWS AND FEATURES
Global Philippines Fine Living
INSIGHTS
INVESTMENT STRATEGY
Economy Stocks Bonds Currencies
THE BASICS
Investment Tips Explainers Retirement
WEBINARS
2024 Mid-Year Economi Briefing, economic growth in the Philippines
2024 Mid-Year Economic Briefing: Navigating the Easing Cycle
June 21, 2024
Investing with Love
Investing with Love: A Mother’s Guide to Putting Money to Work
May 15, 2024
retirement-ss-3
Investor Series: An Introduction to Estate Planning
September 1, 2023
View All Webinars
DOWNLOADS
948 x 535 px AdobeStock_433552847
Economic Updates
Monthly Economic Update: Fed cuts incoming   
June 30, 2025 DOWNLOAD
equities-3may23-2
Consensus Pricing
Consensus Pricing – June 2025
June 25, 2025 DOWNLOAD
Two people discussing a chart on a tablet
Economic Updates
Policy Rate Update: Dovish BSP Narrows IRD 
June 19, 2025 DOWNLOAD
View all Reports

Region: Thailand

Bonds Market Movements Top Picks Issuer List
  • Top Picks
  • Siam Commercial Bank
Sovereign Bonds

Siam Commercial Bank

  • Sector: Financial Services
  • Sub Sector: Banks
  • Country: Thailand
  • Region: Thailand
  • Bond: SCBTB 3.9 24
  • Indicative Yield-to-Maturity (YTM): 5.573% (Indicative as of March 2)
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Fundamental View

AS OF 18 Jun 2025
  • Siam Commercial Bank (SCBTB) has been a sound and profitable bank. It has a focus on the retail segment and targets to increase margins by growing its non-traditional banking businesses. It announced a major business overhaul in September 2021 to establish a new parent company called SCB X to segregate the group’s core banking services (Gen 1) from its new fintech and digital businesses and to enable greater flexibility and independence.

  • Recent credit costs however have been elevated due to the riskier exposure that these entail. However, profitability remains healthy and the capital buffer is strong at both the Holdco (SCB X) and Bank (SCB) level.

Business Description

AS OF 18 Jun 2025
  • Siam Commercial Bank was founded as the "Book Club" in 1904. In 1907, it started operating as a commercial bank and was renamed as "The Siam Commercial Bank". It completed its IPO on the Stock Exchange of Thailand in 1976.
  • The bank is 23.58% owned by the King of Thailand, and a further 23.32% is owned by the Vayupak Fund 1, which is controlled by the government.
  • SCB is the fourth largest Thai bank by assets and is known for its robust retail franchise.
  • Its loan profile was 36% corporate, 17% SME, and 47% retail as of March 2025.

Risk & Catalysts

AS OF 18 Jun 2025
  • We see a significant impact to the Thai economy from potential US tariffs, with ripple effects in the form of lower bank NIMs and higher credit costs than earlier guided for this year. Moody’s also downgraded its rating outlook on the Thailand sovereign, and consequently the Thai banks including SCB X, to negative on 29 April 2025, citing increased risks to Thailand’s economic and fiscal strength, partly due to the potential impact of new US tariffs.

  • Margin pressure at SCB X however is mitigated by a strong deposit franchise and a growth focus on higher yielding retail loans. Loan growth though is likely to remain modest in FY25 given a still soft growth outlook for Thailand.

  • The group’s strategic direction is sensible given limited domestic growth opportunities, but it comes with execution risk since the fintech and platform space are new to SCB, as well as higher credit costs. However, SCB X’s higher NIM and low-40%s cost-income ratio provide comfortable room for that to be absorbed. We also take comfort in the ringfencing of the bank unit (SCB) from the Group’s riskier business units, and management’s minimum CET1 ratio of 16% at SCB.

Key Metric

AS OF 18 Jun 2025
THB mn FY21 FY22 FY23 FY24 1Q25
PPP ROA 2.63% 2.50% 2.88% 2.87% 2.98%
ROA 1.1% 1.1% 1.3% 1.3% 1.4%
ROE 8.4% 8.3% 9.3% 9.1% 10.1%
Equity/Assets 13.4% 13.5% 14.1% 14.2% 14.6%
CET1 Ratio 17.6% 17.7% 17.6% 17.7% 17.6%
Reported NPL ratio 3.79% 3.34% 3.44% 3.37% 3.45%
Provisions/Loans 1.84% 1.45% 1.82% 1.76% 1.59%
Gross LDR 93% 93% 99% 97% 98%
Liquidity Coverage Ratio 202% 216% 217% n/m n/m
Scroll to view columns right arrow

CreditSight View Comment

AS OF 22 Apr 2025

SCB is the 4th largest bank in Thailand and has a leading retail franchise. Asset quality during COVID was poor. It created a new HoldCo structure (SCBX) in 2022 to shift digital units and unsecured retail loans outside the bank, and pledged a >16% CET1 ratio at SCB. The BOT has also ringfenced SCB which further reduces the risk for the SCBTB bonds. The NIM has been strong vs. peers as expected. COVID Blue scheme loans though still sit within SCB, and with higher retail exposure amid elevated household debt have resulted in credit costs staying high, but these have been comfortably absorbed. However, we move SCBTB to U/P as we see a significant impact to the Thai economy and banks from potential US tariffs; we think it should trade slightly behind the top Indian and Philippine banks.

Recommendation Reviewed: April 22, 2025

Recommendation Changed: April 22, 2025

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Korea Gas Corp.

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Pertamina

Bond:
PERTIJ 3.1 30 ​
Credit Rating:
-/BBB/-
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Bonds Market Movements Top Picks Issuer List
  • Top Picks
  • Kasikornbank
Sovereign Bonds

Kasikornbank

  • Sector: Financial Services
  • Sub Sector: Banks
  • Region: Thailand
  • Bond: KBANK 5.458 28
  • Indicative Yield-to-Maturity (YTM): 4.77%
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Fundamental View

AS OF 18 Jun 2025
  • Kasikornbank (KBANK) is a historically sound and profitable bank.

  • Capitalisation is strong and the bank has among the highest CASA ratios in the banking sector. Asset quality took a surprise turn for the worse in 4Q22 due to its larger SME exposure and the bank has since focused on de-risking its portfolio. Credit costs are improving but remain elevated.

  • Margins are high compared to most other Thai banks we cover as a result of its strong SME franchise, but the shift in growth focus to the safer but lower yielding segments has diminished its margin lead.

Business Description

AS OF 18 Jun 2025
  • KBank is currently the second largest bank in Thailand. It briefly was the largest from 2018 until mid-2020, upon which Bangkok Bank completed its acquisition of Indonesia's Bank Permata and took its place.
  • KBank's history can be traced back to 1945 when it was first established as Thai Farmers Bank. It was listed on the Stock Exchange of Thailand in 1976 and changed its name to Kasikornbank in 2003.
  • As of March 2025, the bank's loan mix by segment consists of 41% corporate, 26% SME, 28% retail and 5% others.
  • KBank is known for its strong SME franchise. Its focus industries in SME are construction, construction materials, food & beverage, and hardware.
  • It partially owns a life insurance company, Muang Thai Life.

Risk & Catalysts

AS OF 18 Jun 2025
  • We see a significant impact to the Thai economy from potential US tariffs, with ripple effects in the form of lower bank NIMs and higher credit costs than earlier guided for this year. Moody’s also downgraded its rating outlook on the Thailand sovereign, and consequently the Thai banks including KBANK, to negative on 29 April 2025, citing increased risks to Thailand’s economic and fiscal strength, partly due to the potential impact of new US tariffs.

  • KBANK’s switch to focus on safer segments will also weigh further on the NIM, though it currently remains higher compared to most of its peers.

  • It also still has a higher retail/SME loan mix and sizable restructured loans portfolio (~7.8% of total loans) and so credit costs remain elevated compared to peers. KBANK’s higher NIM and low-40%s cost-income ratio however provide comfortable room for that to be absorbed. The focus on safer segments seems is also helping to stabilize credit costs; the prolonged balance sheet cleanup has concluded at YE24 credit costs are guided to return to a normalized 140-160 bp range this year.

Key Metric

AS OF 18 Jun 2025
THB mn FY21 FY22 FY23 FY24 1Q25
PPP ROA 2.38% 2.36% 2.52% 2.60% 2.67%
ROA 0.98% 0.86% 0.99% 1.14% 1.27%
ROAE 8.3% 7.3% 8.2% 8.9% 9.6%
Equity / Assets 13.1% 13.4% 13.9% 14.9% 15.2%
CET1 Ratio 15.5% 15.9% 16.5% 17.4% 17.6%
Gross NPL ratio 3.76% 3.19% 3.19% 3.20% 3.19%
Provisions / Loans 1.73% 2.11% 2.08% 1.90% 1.60%
Gross LDR 93% 91% 92% 91% 89%
Liquidity Coverage Ratio 174% 164% 195% n/m n/m
Scroll to view columns right arrow

CreditSight View Comment

AS OF 22 Apr 2025

Kasikornbank is the 2nd largest bank in Thailand. We are cautious about its one third loan book exposure to SMEs given the macro backdrop; credit costs spiked in 4Q22 mainly from the SME book and high yield small ticket lending, and the restructured loan book remains sizable compared to peers. The bank however has switched to focus on safer segments, which is weighing on the NIM but helped to stabilize credit costs. Credit costs remain fairly elevated but comfortably absorbed thus far. Capital is high with CET1 above 17%. The NIM though is on a decline from rates coming down. We also see a significant impact to the Thai economy and banks from potential US tariffs, and think it should trade slightly behind the top Indian and Philippine banks. We therefore move KBANK to U/P.

Recommendation Reviewed: April 22, 2025

Recommendation Changed: April 22, 2025

see more issuers DOWNLOAD PDF
Recommended Issuers

Who We Recommend

Korea Gas Corp.

Read Details

Macquarie Bank

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Siam Commercial Bank

Bond:
SCBTB 3.9 24
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Bonds Market Movements Top Picks Issuer List
  • Top Picks
  • Bangkok Bank
Sovereign Bonds

Bangkok Bank

  • Sector: Financial Services
  • Sub Sector: Banks
  • Region: Thailand
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Fundamental View

AS OF 17 Jun 2025
  • Bangkok Bank is a family run conservative financial institution, with high capital and liquidity levels.

  • It acquired Indonesia’s Permata Bank in 2020 which resulted in a meaningful decline in its CET1 ratio to 14%. It is back to ~16% range and management aims to keep the CET1 ratio at ~16% in prepartion for Basel III final reforms.

  • Profitability (ROA and ROE) has historically been below the industry average, due in part to higher exposure to the lower-yielding corporates segment that has resulted in a lower NIM. However, the returns gap has narrowed as this has supported its asset quality outperformance versus peers in a prolonged sluggish macroeconomic environment.

Business Description

AS OF 17 Jun 2025
  • Bangkok Bank was set up in 1944 and was listed on the Stock Exchange of Thailand in 1975. It is a family-run bank and the current President of the bank, Chartsiri Sophonpanich, is the grandson of the founder of the bank.
  • It is the largest bank by assets in Thailand. It was briefly surpassed by Kasikornbank in 2018, but the Bank Permata acquisition has taken BBL back to No.1.
  • The bank is corporate-loan focused, and the loan book was split 48% corporate, 17% SME, 11% retail, and 24% international as at March 2025. It is by far the most international amongst the Thai banks, with branches in 14 economies.
  • BBL's overseas presence has been enhanced by the acquisition of Bank Permata, the 12th largest bank in Indonesia. Bank Permata's asset size is ~10% of that of BBL.

Risk & Catalysts

AS OF 17 Jun 2025
  • We see a significant impact to the Thai economy from potential US tariffs, with ripple effects in the form of lower bank NIMs and higher credit costs than earlier guided for this year. Moody’s also downgraded its rating outlook on the Thailand sovereign, and consequently the Thai banks including BBL, to negative on 29 April 2025, citing increased risks to Thailand’s economic and fiscal strength, partly due to the potential impact of new US tariffs.

  • We anticipate greater NIM pressure on BBL than most peers given the larger corporate book, which has started to come through. Loan growth will also remain middling across the Thai banks due to a focus on quality amid the current backdrop. However, we take comfort in BBL’s strong loss buffers and safer large corporate book.

  • The acquisition of Bank Permata of Indonesia in May 2020 provides BBL with exposure to the high growth opportunities of the Indonesian market, which is the bank’s identified main base for overseas expansion, but this also presents higher risks.

Key Metric

AS OF 17 Jun 2025
THB mn FY21 FY22 FY23 FY24 1Q25
PPP ROA 1.65% 1.60% 1.92% 2.02% 2.17%
ROA 0.65% 0.67% 0.93% 1.00% 1.10%
ROE 5.6% 5.9% 8.1% 8.3% 9.0%
Equity / Assets 11.4% 11.5% 11.8% 12.2% 12.2%
CET1 Ratio 15.2% 14.9% 15.4% 16.2% 15.8%
Calculated NPL ratio 3.20% 3.10% 2.70% 2.70% 3.00%
Provisions / Loans 1.38% 1.24% 1.26% 1.30% 1.34%
Gross LDR 82% 84% 84% 85% 84%
Liquidity Coverage Ratio 270% 271% 277% n/m n/m
Scroll to view columns right arrow

CreditSight View Comment

AS OF 22 Apr 2025

Bangkok Bank’s strength has been its large corporate book and strong capital. It completed the acquisition of Indonesia’s Bank Permata (~12% of loans) in 2Q20 which reduced its CET1 ratio to 14%, but it has since rebuilt it to ~16%. Returns though have been lower due to thinner corporate margins, and we see greater NIM pressure on BBL than most peers from the turn in base rates. We also see a significant impact to the Thai economy from potential US tariffs, with ripple effects in the form of lower bank NIMs and higher credit costs. Disclosure from BBL is less than peers and bad loans jumped in 1Q25. However, we take comfort in BBL’s strong loss buffers and large corporate book. Still, we move BBL to U/P as we think it should trade at least flat to the top Indian and Philippine banks.

Recommendation Reviewed: April 22, 2025

Recommendation Changed: April 22, 2025

see more issuers DOWNLOAD PDF
Recommended Issuers

Who We Recommend

Korea Gas Corp.

Read Details

Macquarie Bank

Read Details

Siam Commercial Bank

Bond:
SCBTB 3.9 24
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Bonds Market Movements Top Picks Issuer List
  • Top Picks
  • Krung Thai Bank
Sovereign Bonds

Krung Thai Bank

  • Sector: Financial Services
  • Sub Sector: Banks
  • Region: Thailand
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Fundamental View

AS OF 17 Jun 2025
  • Krung Thai Bank is the 3rd largest bank by assets in Thailand, with a 55.07% state ownership through the Financial Institutions Development Fund. We see strong government support underpinning KTB’s underlying credit profile.

  • The state influence opens the bank up to potentially government-directed lending; it has secured an increasingly meaningful portion of banking business from government agencies and State Owned Enterprises, which underscored its one-notch upgrade by Fitch in Dec-21.

  • KTB was faced with asset quality challenges in the past and had the highest NPL ratio and restructured loans among the major Thai banks. It has since de-risked its loan book, and asset quality has proven to be more resilient than its peers with lower COVID-19 restructured loans.

Business Description

AS OF 17 Jun 2025
  • KTB is the 3rd largest bank by assets in Thailand. The Thai Financial Institutions Development Fund owns 55.07% of the bank, and has a free float of 44.93%.
  • Being the largest state-owned bank, it secures a meaningful portion of banking business from government agencies and State Owned Enterprises (SOEs) and per the bank, is the preferred bank for the government and SOE employees.
  • Though state owned, the bank runs on a commercial basis and is not considered as a policy bank.
  • KTB's loan profile comprised 45% retail, 25% private corporates, 10% SME, and 20% Government & SOEs at March 2025.

Risk & Catalysts

AS OF 17 Jun 2025
  • We see a significant impact to the Thai economy from potential US tariffs, with ripple effects in the form of lower bank NIMs and higher credit costs than earlier guided for this year.

  • Moody’s also downgraded its rating outlook on the Thailand sovereign, and consequently the Thai banks including KTB, to negative on 29 April 2025, citing increased risks to Thailand’s economic and fiscal strength, partly due to the potential impact of new US tariffs.

  • We anticipate greater NIM pressure on KTB than most peers given the larger corporate book, which has started to come through. Loan growth will also remain middling across the Thai banks due to a focus on quality amid the current backdrop. However, we take comfort in KTB’s conservative focus on the government agencies/SOEs segment, which is supporting asset quality well amid the challenging environment.

Key Metric

AS OF 17 Jun 2025
THB mn FY21 FY22 FY23 FY24 1Q25
PPP ROA 1.83% 1.98% 2.40% 2.45% 2.56%
ROA 0.63% 0.94% 1.01% 1.20% 1.25%
ROE 6.1% 9.2% 9.4% 10.6% 10.5%
Equity/Assets 10.5% 10.9% 11.4% 12.3% 12.6%
CET1 Ratio 15.6% 15.6% 16.5% 17.9% 18.2%
Calculated NPL ratio 3.50% 3.26% 3.08% 2.99% 2.97%
Provisions/Loans 1.31% 0.93% 1.43% 1.18% 1.23%
Gross LDR 99% 98% 104% 100% 97%
Liquidity Coverage Ratio 196% 201% 202% n/m n/m
Scroll to view columns right arrow

CreditSight View Comment

AS OF 22 Apr 2025

KTB is the 3rd largest bank in Thailand by assets and the largest state-owned bank. It is 55% indirectly owned by the Thai government and thus secures meaningful business from government agencies and SOEs (~20% of total loans), which has undergirded its stable asset quality during and post-COVID; it was faced with asset quality challenges in the past, but fundamentals have improved as it de-risked its loan book. We see greater NIM pressure on KTB than most peers from the turn in base rates. We also see a significant impact to the Thai economy from potential US tariffs, with ripple effects in the form of lower bank NIMs and higher credit costs. The CET1 ratio though is solid at ~18% and the loan mix is safer than peers. We have it on M/P as the $ AT1 trades fair versus other SSEA banks.

Recommendation Reviewed: April 22, 2025

Recommendation Changed: April 22, 2025

see more issuers DOWNLOAD PDF
Recommended Issuers

Who We Recommend

Korea Gas Corp.

Read Details

Macquarie Bank

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Siam Commercial Bank

Bond:
SCBTB 3.9 24
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