TMBThanachart Bank’s dividend payout likely at 65% for 2025

But rising NPLs in auto loans and unsecured consumer loans can be a problem.

TMBThanachart Bank (TTB) is assumed to have a dividend payout ratio of 65% in 2025, higher than the 61% in 2024, on its more efficient capital management and return improvements.

The Thailand-based bank logged a net profit of THB5b in Q2 2025, in line with estimates by CGS International. This is 6.6% year-on-year (YoY) lower and 1.8% quarter-on-quarter (QoQ) lower, although in line with the investment house’s estimates.

Loan growth also fell by 7% YoY and 0.4% Qoq during the quarter, pressured by contractions in auto loans and SME loans.

Non-performing loans (NPL) ratio was flat at 3.25% versus 3.26% in Q1 2025.

Non-interest income growth was 14.2% YoY and 9.1% QoQ in Q2 2025; whilst net fee income grew 1.9% YoY but is 4.1% QoQ lower.

Solid non-interest income growth was driven by gains on financial instruments, dividend income, and other non-interest income, said CGS International.

“However, a [quarter-on-quarter] drop in Q2 2025 fee income came from lower mutual fund and structured note product fees,” it said.

Downside risks include rising NPLs in auto loans and unsecured consumer loans, as well as softer-than-expected fee income.

Upsides would be lower-than-expected cost-to-income ratios and wider net interest margins.