Kasikornbank (KBank) is looking for new business areas to generate income to maintain profitability as the bank forecasts its 2018 non-interest income growth will be flat because of rising digital banking transactions.
The country's fourth-largest lender by assets expects flat non-interest income growth next year, down from 5% growth this year, 10% in 2015 and 15% in 2014, said president Kattiya Indaravijaya.
Digital banking transactions and regulatory controls are two key factors taking a toll on the bank's fee-based income. The national e-payment scheme, especially digital money transfers through PromptPay service, is limiting transactional banking fees and the impact is expected to follow the next phase of PromptPay.
"Under this challenging environment, we have to retain our position as the main bank in customers' minds, maintain existing clients and expand our customer base. Customer data is another key factor when rolling out financial services and products to serve customer requirements," she said.
However, the bank aims to maintain its non-interest income ratio at 40% of total revenue for next year.
For 2018, the bank targets loan growth to be in the range of 5-7% and the increase in net interest income to be in line with loan expansion, while controlling non-performing loans at around 3.3-3.4%.
With digitalisation opening more business opportunities, lowering operating expenses and helping to control risks, the bank plans to develop technology and adopt innovative services for all business segments to generate new income, Ms Kattiya said.
KBank set a digital investment budget for next year at 4-5 billion baht. There are several projects in the pipeline scheduled to be implemented soon. The bank also aims for a higher customer base of 15.1 million in 2018, she said, without providing a comparative figure.
Separately, another president Pipit Aneaknithi said the bank expects to expand its mobile banking programme, K Plus, to 8 million users by this year-end and 10.8 million next year.
KBank is the largest mobile banking service provider by number of users.
The bank projects its merchant mobile banking app, K Plus Shop, will see 200,000 users this year and 1 million next year.
KBank plans to adopt new innovative service offerings to both small and medium-sized enterprises (SMEs) and corporate customers under the concept "Consumers' Life Platform of Choice".
It aims to increase the number of K Plus SME users to 420,000 by 2017 and 500,000 in 2018. The bank also plans to launch a new mobile banking feature, Pruanfun, an online market platform, with a goal of selling around 50,000 products.
KBANK shares closed yesterday on the Stock Exchange of Thailand at 222 baht, an increase of two baht, in trade worth 786 million baht.
