The share price of TMBThanachart Bank Public Company Limited (SET: TTB) surged nearly 9% in the afternoon session on Monday, following its 2Q26 strong earnings report during the mid-day break.
Kasikorn Securities wrote that TTB 2Q26 earnings were higher than expectations, primarily due to its strong profit quality. A highlight remains capital management, following a THB 21 billion share buyback and a recent increase in the buyback program to THB 35 billion (around THB 14 billion remaining). This move, alongside a dividend payout of about 60%, is expected to support EPS, ROE, and shareholder returns over the next 12–18 months.
The broker noted that although it sees upside to the 2026 profit forecast given the strong operational results, the current share price—trading near 1x PBV on an ROE of around 9%—implies limited rerating potential above 1x PBV, unless there is concrete visibility on profit-boosting initiatives for 2027, when tax benefits are set to expire.
Summary of 2Q26 Financial Statement
TTB delivered a robust second-quarter performance for 2026, reporting a net profit of THB 5,513 million, a significant 10.2% increase over the same period last year. Total operating income reached THB 17,343 million, marking a 5.9% year-over-year (YoY) climb. The bank’s bottom line was bolstered by a resilient return on equity (ROE) of 9.3%, reflecting a strengthening financial position despite a moderating domestic economy.
Key Financial Highlights
- Net Profit: THB 5,513 million (+10.2% YoY).
- Non-Interest Income: THB 5,079 million (+39.5% YoY).
- Net Interest Margin (NIM): 3.03%, successfully held within target.
- Non-Performing Loan (NPL) Ratio: Stable at 2.93%.
- Earnings Per Share (EPS): THB 0.06, up 20% YoY.
The bank’s results highlighted a clear divergence between business units. Non-interest income (Non-NII) was the star performer, surging 39.5% YoY to THB 5,079 million. This growth was driven by a recovery in bancassurance and mutual fund fees as wealth management clients reallocated assets toward investment products in a low-deposit-rate environment.
In contrast, net interest income (NII) acted as a laggard, declining 3.7% YoY to THB 12,265 million. This contraction was primarily due to the cumulative impact of policy rate cuts and a strategic “selective lending” approach that prioritizes loan quality over volume. While traditional hire-purchase loans fell 1.5% during the quarter, the bank saw double-digit growth in high-yield personal loans, specifically its ‘Cash2Go’ product.
Prudent Risk Management and Lower ECL A standout feature of the results was the management of Expected Credit Loss (ECL), which fell 5.9% YoY to THB 4,040 million. For the first half of 2026, total ECL dropped 9.5% to THB 8,035 million, equivalent to an annualized credit cost of 136 bps. Despite stable asset quality, TTB maintained a conservative stance by setting aside an additional THB 1.1 billion in management overlay to buffer against economic uncertainty.
