Active Growth of 12% in KBank Large Corporate Loans in 1Q18, Boosted by Exports Cashless Payment via EDC Surging 20%

Stocks and Financial Services Press Releases Friday May 4, 2018 09:44
Bangkok--4 May--KASIKORNBANK

Amid high growth in the corporate customer segment in line with economic improvements and outstanding export performance, KASIKORNBANK (KBank)'s large corporate loans in 1Q18 recorded 12-percent rise to a total of 581.580 billion Baht, with main drivers being borrowing requirements in the sectors of export-oriented industry, agriculture and construction. As concerns payments via EDC, the volume also rose 20 percent, due mainly to Chinese tourists' spending and expansion of Thailand's cashless society.

Mr. Patchara Samalapa, KBank President, unveiled that the operations of KBank's Corporate Business Division (CBS) in 1Q18 expanded at a higher rate than previously estimated, given the increase in large corporate customers' requirements for loans and capital funds to finance their business activities. Total income of CBS amounted to 6.371 billion Baht, rising 5 percent over-year, and fee income stood at 3.117 billion Baht, up 3 percent YoY. Meanwhile, total loans surged 12 percent YoY to 581.580 billion Baht, mostly driven by farm and agricultural processing industries that benefited from the healthier global economy. Consequently, KBank's global trade transactions also registered outstanding performance.

Other industries that exhibited outstanding growth in 1Q18 included construction and construction materials, following many government projects that have been on progress. Amid this situation, KBank has been able to control NPLs in the large corporate segment within the target.

KBank's large corporate customers have also raised funds in the form of private bond issuance. In 1Q18, KBank was on top of the market with the total value of issued private bond at 45.662 billion Baht, or equal to 24 percent of market share.

Mr. Patchara added that large corporations have the same cash management costs as banks and if such costs are reduced, their business efficiency can be enhanced substantially. As a result, KBank has decided to develop solutions related to the cashless society to meet the needs of this customer segment. Over the years, KBank has steadily introduced new features to our EDC devices via QR Code that are capable of accommodating Alipay and WeChat Pay apps used by Chinese tourists.

Such EDC devices have been installed at premises of our merchants in various industries of both the public and private sectors. The focus has been on the establishments that are market leaders to facilitate their huge payment transactions, namely, hospitals, beauty salons, hotels, restaurants, convenience stores, shopping malls, goldsmiths, pawnshops, car dealers, airlines, river piers, universities and insurance companies. Given this, spending via KBank EDC devices surged 20 percent YoY during 1Q18.

In addition, KBank has offered sales promotions to encourage our customers to spend via QR code such as giving them cashback on AirAsia flight booking with QR code payment on K PLUS app and an opportunity to win iPhone 8 when making payments to BaNANA, Studio7 and BKK via K PLUS app. Moreover, KBank has used K PLUS customer-lifestyle database to design campaigns for big events such as the sales of advance tickets for Motor Show via K PLUS app.

Thanks to the satisfactory growth of business in 1Q18 and steady expansion of cashless society in Thailand, KBank is confident that we will be able to continue supporting our customers according to our targets with an overall loan growth of 6-8 percent and a rise of fee income by 2-5 percent.

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