Krungsri Securities (KSS) forecasts that SCB X Public Company Limited (SET: SCB) will report a fourth quarter 2025 net profit of 10.9 billion baht, down 7% year-on-year and 10% quarter-on-quarter, attributed to a combination of lower net interest income (NII), weaker non-interest income (Non-NII), and higher operating expenses.
Net interest income is expected to drop 12% year-on-year and 3% quarter-on-quarter, with the net interest margin (NIM) falling to 3.30% from 3.88% in 4Q24 and 3.44% in 3Q25, following a policy interest rate reduction in August 2025.
Non-interest income is forecast to decrease 4% quarter-on-quarter due to weaker investment returns (FVTPL), while operating expenses are projected to rise 4% quarter-on-quarter, driven by increased marketing and employee-related costs.
Overall loan growth is expected at 0.3% quarter-on-quarter, translating to a -1.8% change year-to-date. Asset quality is seen to slightly deteriorate with the NPL ratio rising to 3.40% from 3.30% in the previous quarter amid ongoing economic uncertainties.
Looking ahead to 2026, Krungsri expects SCB’s net profit to fall by a further 2% year-on-year, driven by a lower NIM resulting from an expected policy rate cut to 1.00% in the first half of 2026, strategic loan expansion into lower-risk segments, and reduced interest burdens from the “You Fight, We Help” program.
Despite these challenges, KSS maintains a ‘Buy’ recommendation on SCB, keeping the 2026 target price at 155 baht per share, citing the bank’s effective asset quality management and its appealing dividend policy, with a sector-leading yield anticipated at 9% per annum. For the second half of 2025, dividend payment is expected at 9.23 baht per share, representing a 7% yield.
