On Wednesday at 11:45 AM (Bangkok time), the share price of Kasikornbank Public Company Limited (SET: KBANK) dropped by 3.72% or THB 9.00 to THB 233.00, with a trading value of THB 6.07 billion.
Krung Thai Bank Public Company Limited (SET: KTB) lost 4.62% or THB 2.00 to THB 41.25, with a trading value of THB 5.75 billion.
Bangkok Bank Public Company Limited (SET: BBL) contracted by 1.85% or THB 3.50 to THB 185.50, with a trading value of THB 2.04 billion.
SCB X Public Company Limited (SET: SCB) declined by 2.29% or THB 3.50 to THB 149.50, with a trading value of THB 2.09 billion.
TMBThanachart Bank Public Company Limited (SET: TTB) fell by 2.00% or THB 0.06 to THB 2.94, with a trading value of THB 1.07 billion.
Kiatnakin Phatra Bank Public Company Limited (SET: KKP) slumped by 2.67% or THB 3.00 to THB 109.50, with a trading value of THB 796.74 million.
KGI Securities (Thailand) wrote that, in response to the recent flooding, several commercial banks have introduced relief measures to support customers in both retail and SME loan segments. These measures include temporary suspension of interest payments for three to six months, reduction of principal repayments, lowering of monthly installment amounts, extension of debt repayment periods, and offering special interest rates.
For SME customers, most banks are providing additional support measures, such as offering extra working capital loans and special interest-rate loans at approximately 3.5%. Combined with assistance from state-owned specialized financial institutions, these are expected to offer comprehensive support to debtors nationwide.
Additionally, the brokerage anticipates that non-bank companies will gradually roll out similar relief programs in line with commercial banks in the near future. In terms of operational impacts, the support measures for retail customers may put pressure on the net interest margin of banks.
KTB is expected to be most impacted, given its high proportion of retail customers at 40% of total loans, followed by SCB at 15%, KBANK at 10%, and BBL at less than 10%.
However, KGI believes that these measures present an opportunity for banks to accelerate debt restructuring, which should ultimately help reduce pressure on credit costs, in line with forecasts for 2026. The estimated credit costs are 1.04% for KTB, 1.24% for BBL, 1.50% for KBANK, and 1.62% for SCB.
Regarding investment outlook, KGI maintains an ‘Overweight’ recommendation on the banking sector despite recent share price declines and underperformance relative to the SET Index. The impact of the flooding on the overall economy and GDP growth is assessed as manageable. Consequently, the recent dip in bank stock prices is regarded as a buying opportunity, with the brokerage highlighting KBANK, KTB, KKP, and TTB as its top picks, all recommended as ‘Buy’.
