Earnings Report /
Thailand

Siam Commercial Bank PCL/The: Deep profit miss! Lower non-NII than assumed

  • Result was 29% below our expectation

  • SCB reported 4Q22 earnings of Bt7.1bn

  • Lending rose 1.3% QoQ during 4Q22

Poramet Tongbua
Poramet Tongbua

Equity Research Analyst

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Bualuang Securities
23 January 2023

We have a BUY call on SCB, premised on loan growth in 2023 (driven by retail business), a fatter NIM (led by high-yield lending growth among subsidiaries and higher interest rates), and lighter tax expenses (a high 2022 base). Our dividend yield assumption for 2023 is 4.2%.

Result was 29% below our expectation

SCB reported 4Q22 earnings of Bt7.1bn, down by 9% YoY and 31% QoQ. The result was 29% below our projection (and 30% south of the Bloomberg consensus), due to lower non-NII than assumed (chiefly, losses on financial instruments). Pre-provision operating profit came to Bt17.4bn, down by 21% YoY and 24% QoQ. 2022 earnings comprise 93% of our full-year projection of Bt40.6bn.