Bank Profits Fall to 500B Baht in 2025 Amidst Narrowing Margins

Thansettakij•Economy•6h ago

Reader Briefing

Thai commercial banks reported a net profit of 500 billion baht in 2025, a decrease from the previous year, driven by reduced net interest income due to lower policy rates and loan portfolio contraction.

•Commercial banks in Thailand recorded a net profit of approximately 500 billion baht in 2025, a decline compared to 2024.
•Key factors contributing to the profit drop include narrowing interest margins and a slight contraction in the loan portfolio, particularly for SMEs.
•The Bank of Thailand (BOT) expects loan growth to recover slightly in 2026 to 1.6%-2% as the economy improves.
•Measures such as 'SME Credit Boost' are being implemented to address the contraction in SME lending.

Overview

•In Q4 of 2025, the Non-Performing Loan (Stage 3) amount was 536 billion baht, resulting in an NPL ratio of 2.84%.
•Commercial bank net profits for 2025 totalled approximately 500 billion baht, decreasing from 2024.
•Net interest income for commercial banks in 2025 decreased due to a reduction in interest rates passed on to borrowers and relief measures.
•The Net Interest Margin (NIM) decreased from 2.66% to 2.54% in Q4 of 2025.
•The Bank of Thailand launched the 'SME Credit Boost' project to inject 100 billion baht in new credit into high-potential SME industries within two years.
•For the entirety of 2025, Thai commercial bank lending saw a slight contraction of -1.1%, marking the sixth consecutive quarter of decline.
•Small and Medium Enterprises (SMEs) experienced a continuous loan contraction for 14 consecutive quarters, indicating structural issues.
•The Bank of Thailand forecasts a slight recovery in loan growth for 2026, estimated between 1.6% and 2%, contingent on economic recovery.

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Key Quotes

Somsong Lerlapwasin (Assistant Governor, Financial Institution Supervision Department, Bank of Thailand)

"The commercial banking system is stable and secure, with high capital funds, reserves, and liquidity."

ระบบธนาคารพาณิชย์มีความมั่นคงและมีเสถียรภาพ โดยมีเงินกองทุน เงินสำรอง และสภาพคล่องอยู่ในระดับสูง

Suchot Piamchol (Senior Director, Financial Institution Model Audit and Risk Analysis Department, BOT)

"The performance of the commercial banking system in 2025 had total net profits of approximately 500 billion baht, a decrease from 2024."

ผลประกอบการของระบบธนาคารพาณิชย์ในปี 2025 มีกำไรสุทธิรวมประมาณ 5 แสนล้านบาท ซึ่งปรับลดลงจากปี 2024

Key Entities

Organization

Bank of Thailand (BOT)(ธนาคารแห่งประเทศไทย (ธปท.))ℹ️

The central bank of Thailand, which monitors the commercial banking system and forecasts economic trends.

Sukhumvit Asset Management (SAM)(บริษัทบริหารสินทรัพย์สุขุมวิท (SAM))

A company involved in debt management and resolution programs in Thailand.

Person

Somsong Lerlapwasin(นายสมชาย เลิศลาภวศิน)

Assistant Governor of the Financial Institution Supervision Department at the Bank of Thailand.

Suchot Piamchol(นายสุโชติ เปี่ยมชล)

Senior Director of the Financial Institution Model Audit and Risk Analysis Department at the Bank of Thailand.

Law

SME Credit Boost

A project introduced by the Bank of Thailand to support lending to SMEs in specific industries.

Responsible Lending

A program by the Bank of Thailand aimed at debt resolution and assistance for debtors.

Close Debt Quickly, Move Forward(ปิดหนี้ไว ไปต่อได้)

A debt resolution program facilitated by Sukhumvit Asset Management (SAM) to help debtors improve their credit history.