Thailand's best domestic bank 2020: Siam Commercial Bank
Siam Commercial Bank
Siam Commercial Bank (SCB) chief executive Arthid Nanthawithaya must be wondering what will be thrown at him next. Since taking the helm in 2016, he has had to steer the bank through times of anaemic economic growth, political volatility and a Covid-19 pandemic that led to a two-month lockdown. It says a lot about SCB that despite tough operating conditions, it continues to outperform.
For the first quarter of 2020, SCB reported consolidated net profits of Bt9.3 billion ($298 million), an increase of 1% from the same period in 2019. The results were above the consensus forecasts, despite higher loan-loss provisions.
By other measures SCB also did well in a difficult environment: with a return on equity of 9.3% it beat its nearest rival, Krung Thai Bank, whose ROE is 7.8%; and its return on assets of 1.2% puts it ahead of Bangkok Bank, with 0.9%.
With a network of 954 domestic branches as of June, SCB has a lot more going for it. It is a pioneering force in digital banking; its total number of digital customers has jumped from about 5.5 million in 2017 to more than 10 million at the end of 2019. During the awards period, the Bangkok lender played a pivotal role in several important capital market transactions, including the Bt48 billion IPO of Asset World Corporation.
It has expanded its strategic partnerships with leading regional e-commerce companies such as Amazon Global Selling and Lazada to boost business opportunities and increase its range of services.
All this has impressed analysts keeping an eye on the country’s banking system.
“SCB is still well placed versus other Thai banks…distinguished by growth in unsecured loans and willingness to return capital,” says one analyst at an international investment house.
Other analysts like the fact that SCB has excess capital and is close to the end of its three-year digital transformation programme, which means that revenue pressures will be partly offset by falling costs.