Bangkok Bank (BBL) expects the banking sector to continue to face heightened challenges in the final quarter of the year, amid sluggish loan demand and falling interest income.
President Chartsiri Sophonpanich said loan growth in the fourth quarter and for the entire year is expected to remain subdued, in line with the country’s economic conditions.
However, the bank is continuing with its efforts to support lending and enhance liquidity for customers amid the economic slowdown.
BBL, the country’s largest lender by total assets, reported a total loan portfolio of 2.61 trillion baht as of September 2025, representing a 3.9% decline from the previous quarter and 3.2% year-to-date.
Meanwhile, the bank’s net interest income (NII) dropped to 30.7 billion baht in the third quarter, down 3% quarter-on-quarter and 7.8% year-on-year.
As of September, Thailand’s six domestic systemically important banks (D-SIBs), which includes BBL, posted a combined loan portfolio of 13.1 trillion baht, a 1.36% contraction from December last year.
The total NII of the D-SIBs tallied 161 billion baht, down 7.69% year-on-year, driven by the country’s weak economic environment, reflecting both sluggish GDP growth and the Bank of Thailand’s accommodative monetary policy stance.
The central bank’s Monetary Policy Committee has cut the policy rate four times since October last year — a total reduction of 100 basis points. In 2025, the central bank lowered the benchmark rate three times, bringing it down to 1.5%.
The regulator downgraded its GDP growth forecasts for 2025 and 2026 to 2.2% and 1.6%, respectively, from 2.3% and 1.7%.
Given this environment, Mr Chartsiri said the bank expects its net interest margin (NIM) and NII to further decelerate in the final quarter.
However, BBL aims to maintain positive momentum in fee-based income growth for the remainder of the year, following a solid performance in the third quarter.
BBL’s non-NII rose to 16.9 billion baht in the third quarter of 2025, up 33% quarter-on-quarter and 35.7% year-on-year, despite continued NIM compression.
The bank’s NIM gradually declined from 3.07% in the fourth quarter of 2024 to 2.82%, 2.78% and 2.74% in the first, second and third quarters of 2025, respectively.
Mr Chartsiri emphasised the bank has appropriately transmitted the monetary policy by continuing to lower its lending interest rates, in line with the central bank’s policy rate cuts.
Future interest rate movements will primarily depend on the central bank’s monetary direction.
He said the bank remains committed to supporting customers through debt restructuring amid ongoing economic headwinds.
BBL’s non-performing loans (NPLs) declined to 90.1 billion baht in the third quarter, down 2.9% from the previous quarter, though the NPL ratio edged up slightly to 3.3% from 3.2%.