Krungsri (Bank of Ayudhya) reported its regional banking business accounted for 20% of total revenue, primarily attributed to high-yield loan products.
According to Duangdao Wongpanitkrit, chief financial officer at Krungsri, income from regional banking in 2024 surged to 20% of total revenue, up from a single-digit percentage the previous year.
This growth was primarily driven by high-yield loan products in the consumer and microfinance sectors, despite regional outstanding loans accounting for only 5-6% of the bank's total loan portfolio, she said.
Krungsri set a conservative regional loan growth target for 2025 of 3-5%. Although Southeast Asia's economy is expected to record strong growth, the bank plans to expand the regional loan segment cautiously this year.
The bank wants to focus on standardising its loan portfolio in certain regional markets, especially after recent asset acquisitions, while gradually growing new loans, said Ms Duangdao.
The country's fifth-largest lender by total assets operates its consumer and microfinance businesses across multiple Southeast Asian countries, including Laos, Cambodia, Vietnam, the Philippines and Indonesia, serving more than 19 million customers.
She said the bank targets total loan growth of 2-4% this year, with the majority of the contribution coming from the corporate segment.
Krungsri wants to grow corporate lending by 5-7%, in line with the lower credit risk associated with this business segment, said Ms Duangdao.
However, the bank expects flat growth in retail and small and medium-sized enterprise (SME) loans due to the fragility of these sectors.
Slower GDP growth in Thailand, coupled with high household debt levels, may impair individuals' and SMEs' ability to repay loans, she said.
Krungsri remains committed to supporting working capital for existing SME customers, said Ms Duangdao.
On a separate note, Krungsri chief executive Kenichi Yamato said the bank continues to focus on social and sustainable finance, increasing its loan growth target to 250 billion baht by 2030, up from the previous target of 100 billion baht.
The bank has expanded its loan products, with a positive outcome, reaching 95 billion baht by the end of 2024, which contributed to the upward revision of the target.
"Our positive growth in sustainable finance is supported by increased awareness among Thai customers, as well as encouragement from the government and the Bank of Thailand through sustainable economic transformation," he said.
Krungsri is a leader in Thailand's social and sustainable finance market, particularly in environmental, social and governance bond underwriting, holding a 19% market share.
In addition, he said the bank is also focusing on digital banking services through artificial intelligence (AI) technology under its AI-powered banking service initiative.
The bank introduced an AI-driven valuation system and optimised ATM cash replenishment solutions, significantly enhancing both customer experience and operational efficiency.
In 2024, Krungsri invested more than 14 billion baht to develop IT and digital solutions.
