Thai banks' asset quality continues to weaken

Risks are prevalent in the SME and unsecured retail loans segments.

According to Fitch Ratings, asset quality risks are particularly present in more vulnerable segments such as SME (which accounts for 39% of sector lending) and unsecured retail loans (9% of sector lending), which are generally affected faster by a weak economy.

Here's more from Fitch:

Furthermore, leverage in the private sector and in households remains high (at 149% and 81% of GDP, respectively, as of 1H16), which adds to potential downside risks.

Fitch expects these asset-quality pressures to remain manageable for most banks – the banking sector has relatively high levels of loan-loss reserve coverage at 127%.

Banks have also been reducing loan growth over the past four quarters (in 1H16 loan growth was below nominal GDP growth), and tightening up credit standards in response to the weaker business climate.

Also Read

SMBC, Fujitsu Limited to create data analytics business

Thai banks not “materially” affected by Myanmar earthquake

Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

I want to download the media kit