Acting managing director Surat Leelataviwat said the company plans to see its auto-refinancing loan portfolio at 20% of total outstanding car loans in three years, up from 9% now as it expands its overall margin in the high-yield auto leasing business.
KLeasing pulled out of the high-yield used car loan business two years ago.
Its strategy is to mix low yields and risk with high yield and riskier loans in its portfolio to have a balance between revenue expansion and asset quality.
"You could estimate the income generated from lending on five new cars is equal to only one car-refinancing loan, on average. Our auto-refinancing outstanding loans are still small at around
new-car loans represent the lion's share of its portfolio at 60%, some
KLeasing still has around 10 used car loans left in its portfolio out of 100 car loans. The fiercer competition among leasing firms and higher non-performing loans (NPLs) in the segment were key reasons the company left the business.
It booked mild growth on outstanding loans of 3.67% in the first half of the year compared with the same period the year before despite a lower growth rate of new-car loans in line with the country's economic circumstances as well as the vehicle industry.
The company posted a first-half net profit of
KLeasing wants to maintain NPLs at their existing level of 1% of the total loan portfolio by the end of this year.
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