Non-interest income also jumped 19%.
According to Maybank Kim Eng, Kasikornbank's loan growth was 1% QoQ and 7% YoY in 1Q14. NIM stood strong at 3.61% though the cut interest rate in 1Q14 as the bank cut the funding cost by early redemption of thedebentures and the maturity of high-rate deposits.
Non-interest income jumped 19% YoY, thanks to strong net premium earned (+35% YoY and +46% QoQ), net trading income and fees from card business. OPEX grew 15% YoY while cost to income ratio was flat YoY at 40%.
Stable asset quality. NPL ratio was flat QoQ at 2.33% in 1Q14. The strong earnings in 1Q14 led the bank setting aside provisions of THB3.7bn or 100bps credit costs which is higher than previous guidance of 85bps. However, we expect credit costs to drop from 2Q14 same as last year. The coverage ratio stood at 138% in 1Q14.
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