Thailand Banks: Raise TPs on better non-ll prospects; TTB positive Catalyst Watch

研报英文原文证据摘录

Thailand Banks: Raise TPs on better non-ll prospects; TTB positive Catalyst Watch

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13 Jul 2026 20:21:17 ET │ 28 pages

Thailand Banks

Raise TPs on better non-II prospects; TTB positive Catalyst Watch

CITI'S TAKE

Yong Hong Tan AC

YTD-26 TH Banks (+22%) trail behind SG banks (+30%), outperforming MY +65-6657-7873

(+1%), PH (-10%) and ID (-30%) in US$ terms. Similar to SG banks’ 2024-26 yong.hong.tan@citi.com

playbook, despite stable ROE profiles, the market was positioning for

higher DPS given non-II growth from wealth-related fees and lower loan-

to-asset ratio driving better RoRWA return. Newly BoT approved

AI/advanced electronics investments also drove growth sentiments (link). In

the local context, TH banks narrowed YTD-26 underperformance with the

broader FTSE TH index from 18% in early Jun-26 to just 4%, highlighting

investors’ rotations. With dividend yield spread ~4% wider than historical

trends and highest across ASEAN banks, the next leg of TH banks’ rally

could be extended if 1Q26 robust fees income momentum continues, and

signs of easing credit costs. Stock view: We open a 30-day positive catalyst

watch on TTB, expecting market to price-in mgmt. reallocating excess

capital return from share buyback to dividends.

TH banks theses — [1] Highest CASA ratio within ASEAN (60-80%) and BoT rate

cuts to 1.0% (FD rates <1%) are conducive backdrop to convert low-returns deposits

into investment products, driving wealth/customer-related trading income.

Watching if 1Q26e double-digit growth can be sustained into 2Q26e. [2] Focused on

corp/high quality loans and away from retail/high yield loans in recent years amid

derisking and broad deleveraging. LLC buildup provides buffers. [3] Recent Moody’s

upgrade of outlook for TH banks could reduce CoF.