CGSI expects Q3/2026 bank profits to shrink 9.2%, names KBANK as Top Pick

Kaohoon··TH·Read original
3▲5 ▼2Impact / 5
Summary · why it matters

CGS International Securities (Thailand), or CGSI, estimates that the combined net profit of the eight banks covered by its analysts in the third quarter of 2026 will come to 57.4 billion baht, down 9.2% from the same period a year earlier but up 1.8% from the previous quarter. The decline is pressured by an overall commercial banking sector loan book that is trending toward slower expansion, based on monthly loan data from the Bank of Thailand for August 2026, which showed that large corporate customers of Bangkok Bank, or BBL, and Kiatnakin Phatra Bank, or KKP, made substantial debt repayments. As a result, the combined loans of the banks covered by the analysts fell 0.1% in August from the previous month, though they still grew 3.0% from the same period a year earlier and are up 2.4% since the start of the year. The banks still posting positive loan growth are led by Thai Credit Bank, or CREDIT, Krung Thai Bank, or KTB, and Tisco Financial Group, or TISCO. Pre-provision operating profit is expected to fall 6.8% from the same period a year earlier but rise 1.7% from the previous quarter, while the net interest margin is expected at 2.89% and the non-performing loan ratio at 3.66%. Breaking it down bank by bank, KKP is expected to post the strongest performance, with net profit growing as much as 32.2% from the same period a year earlier, followed by TMBThanachart Bank, or TTB, whose net profit is expected to grow 4.6% from the same period a year earlier. On the other hand, BBL is expected to post the weakest results, with net profit down 24.5% from the same period a year earlier, followed by KTB, whose net profit is expected to fall 16% from the same period a year earlier. On investment strategy, CGSI recommends maintaining a Neutral weighting and selects Kasikornbank, or KBANK, as its Top Pick for the sector, given that fee income from wealth management accounted for as much as 18% of its non-interest income in 2025, and it expects a dividend yield of as much as 6.2% in 2026, beating the sector average of 5.6%.

Impact on assets 7

Financials± Mixed · 6 stocks
Thai Credit Pcl
CREDIT
▲ PositiveCapitalrelevance

Thai Credit Bank is among the banks still posting positive loan growth.

Digital Finance & Tokenization▼ · 1 stocks
Bangkok Bank PCL
BBL
▼ NegativeCapitalrelevance

BBL expected to post the weakest results with net profit down 24.5% YoY, pressured by large corporate debt repayments.

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