The bank expected its NPLs to peak last quarter with signs of improvement after the military regime took over.
Late repayments of car loans have dropped over the past two months, reflecting the better debt-servicing ability of customers, said chairman and president Apinant Klewpatinond.
"It will take some time to see a clear improvement," he said, adding the bank expects bad loans to gradually improve in the final quarter.
Kiatnakin's NPLs rose to 4.2% or
Of the bad loans,
The bank said demand for car loans has been picking up from the start of this month, supported by better sentiment and its internal process development in which it is focusing on improving both loan analysis and service quality. But the bank's car loans are expected to remain at
Flat growth would be in line with an assumption of a 40% drop in new-car sales this year. Loan demand for used cars still faces a tough time.
Kiatnakin has no plans to reduce its loan portfolio because it is its core business.
"Under reasonable risk management, the high yield of the used-car loan portfolio contributes good income while we are entering low-yield corporate loans," Mr Apinant said.
The small bank with outstanding loans of
Mr Apinant said despite positive signs for corporate loans, consumer finance would require about six months to return to normal. As a result, the bank has revised down its 2014 target for total loan growth to 5-6% from 9.5%.
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