Kasikorn Securities assesses that the commercial banking sector's core operations are on a gradual recovery path. It expects the combined profit of the seven banks under its coverage in the third quarter of 2026 to reach 49.4 billion baht, down 2% from the second quarter of 2026 and down 15% from the third quarter of 2025, pressured by non-operating items. The main supporting factor comes from lower interest costs, with the net interest margin expected to rise 0.2% from the previous quarter, while loan-loss provisioning expenses are expected to fall 0.7% as management's additional reserves decline. For the fourth quarter of 2026 and continuing into 2027, loan growth is expected to accelerate, driven mainly by corporate and government lending, while retail and SME loans remain weak. On investment strategy, Kasikorn Securities maintains a positive view on the banking sector, selecting KKP and KTB as its top picks with buy recommendations and target prices of 153 baht and 48 baht respectively. It has also shifted the valuation base year for the entire banking sector from mid-2027 to the end of 2027 and raised individual target prices by 1-3%, without changing its earnings forecasts.
Kiatnakin Phatra Bank Public Company LimitedKasikorn Securities names KKP a top pick with a buy rating and 153 baht target price, raising its target on the sector re-rating.
Krung Thai Bank Public Company LimitedKasikorn Securities names KTB a top pick with a buy rating and 48 baht target price, raising its target on the sector re-rating.
