# CIMB Thai Reports 8.4% Q1 Profit Increase, Citing Reduced Credit Losses and Operating Expenses

- Link: https://www.thailand-business-news.com/banking/302383-cimb-thai-reports-8-4-q1-profit-increase-citing-reduced-credit-losses-and-operating-expenses
- Published: 2026-04-21T15:38:32+07:00
- Author: Chloe Zhou

**CIMB Thai Bank’s Q1 net profit rose 8.4% to 908.2 million baht, driven by lower
credit losses and operating expenses, despite a decline in net interest income due
to low rates.**

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## Key Points

 * **Profit Growth:** CIMB Thai Bank reported an 8.4% net profit increase in Q1 
   FY2026, reaching 908.2 million Thai baht. This rise was primarily due to a significant
   reduction in expected credit losses (down 21.1%) and a slight decrease in operating
   expenses (down 0.6%).
 * **Revenue Challenges:** Despite profit gains, operating income declined 3.1% 
   to 3.47 billion Thai baht. This was attributed to a drop in net interest income
   caused by lower asset yields in a low interest rate environment and a 22.7% fall
   in net fee and service income, particularly from insurance and underwriting.
 * **Strategic Outlook:** CIMB Thai remains committed to its Forward30 strategy,
   focusing on balance sheet strength, deposit growth, and quality expansion. The
   bank aims to leverage its ASEAN network to capture regional flows and support
   evolving customer needs, despite a more uncertain operating environment.

### Profit Growth Driven by Cost and Loss Reduction

CIMB Thai Bank PCL, a subsidiary of CIMB Group Holdings Bhd, has reported a notable**
8.4% increase in net profit for the first quarter of fiscal year 2026**. This positive
performance was primarily fueled by a significant **reduction in expected credit
losses, which decreased by 21.1% year-on-year**, and a marginal **0.6% dip in operating
expenses**. These efficiencies, particularly lower employee-related costs, contributed
to a more favorable bottom line. Despite a challenging economic climate, the bank
has demonstrated its ability to manage costs effectively and mitigate potential 
financial risks.

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### Income Challenges and Strategic Outlook

While profit saw an uptick, **operating income for CIMB Thai declined by 3.1%**.
This contraction is largely attributed to a **7.1% fall in net interest income**,
a direct consequence of **lower asset yields amid a prevailing low interest rate
environment**. Furthermore, net fee and service income experienced a significant**
22.7% decline**, impacted by reduced insurance brokerage and underwriting fees. 
The bank’s **cost-to-income ratio also rose to 48.9%**. Nevertheless, CIMB Thai 
remains steadfast in its commitment to delivering resilient returns by focusing 
on **deeper customer engagement, cross-selling initiatives, and robust risk management**
as part of CIMB Group’s Forward30 strategy.

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### Financial Position and Capital Strength

CIMB Thai maintains a **healthy financial position and strong capital adequacy**.
Total gross loans saw a modest increase of **1.6%** by the end of March, while deposits
saw a decline. Importantly, the bank improved its **gross non-performing loan (NPL)
ratio to 2.1%**, reflecting sound credit management. The **loan loss coverage ratio
significantly strengthened to 178.0%**, exceeding regulatory requirements. CIMB 
Thai’s **total consolidated capital funds stand at 58.6 billion Thai baht**, with
a robust **BIS ratio of 19.6%**, underscoring its financial stability and capacity
to support future growth and evolving customer needs within the ASEAN region.