Asia Plus keeps banking stocks at market weight, expects Q3/2026 profit to reach 65 billion baht

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Asia Plus Securities has issued an analysis of banking stocks, maintaining its investment weighting at market weight, or Neutral, and forecasting combined net profit for the eight banks under coverage in the third quarter of 2026 at 65 billion baht, up 1.6% from the previous quarter but down 8.8% from the same period a year earlier, due to the very high base of securities trading revenue in the prior year. TISCO will be the first bank to report results on October 14, followed by other large commercial banks on October 20-21. The research team said quarter-on-quarter profit growth will be led by KTB, which is expected to post a 7% profit increase on recovering net interest income and investment gains in THAI, followed by BBL, expected to rise 5% on lower operating expenses and lower expected credit losses. Net interest income is expected to rise 1.4% quarter on quarter even as loan growth stays flat, supported by lower funding costs and deposit restructuring, lifting the group's net interest margin by 4 basis points to 3.02%. Provisioning costs are expected to improve to 1.4% from 1.5% in the second quarter of 2026, while the non-performing loan ratio is expected to hold steady at 3.6%. If results meet expectations, combined net profit for the first nine months of 2026 will be 194 billion baht, or 78% of the company's full-year estimate and 76% of the Bloomberg Consensus forecast. Asia Plus Securities recommends KTB with a fair value of 48 baht and KBANK with a fair value of 259 baht, as both stocks have fallen more than the sector average over the past month while still posting consistently strong financial statements.

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