Ms. Kattiya Indaravijaya, Chief Executive Officer of KASIKORNBANK, said the Thai economic recovery was limited in the first quarter of 2023. Although the tourism sector continued to recover, the merchandise exports declined further compared to the same period last year, due to negative impacts from the global economic slowdown. Meanwhile, private sector spending saw moderate growth. For the remainder of 2023, close attention should be paid to the uncertainty of global economic recovery, the stressed situation of the banking sectors in advanced economies, and adverse impacts from the tightening monetary cycle, particularly in the United States, that could hurt the overall export sector. The Thai exports are expected to decline in 2023.

In addition, pressures from rising production costs and cost of living, as well as household debt problems could affect domestic spending. All of these factors could hamper the Thai economic growth for the remainder of this year. KBank and its subsidiaries continue to conduct business with the prudence under the uncertain economic circumstance and still continuously provide assistance to customers who have been affected by the uneven economic recovery through various channels of the Bank.

Operating performance for the first quarter of 2023 compared with the first quarter of 2022,

KBank and its subsidiaries reported net profit for the first quarter of 2023 of Baht 10,741 Million, a decrease of 4.19% over the same period of 2022. Operating profit before expected credit loss and income tax expense was amounting to Baht 26,781 Million, an increase of 15.32% over the same period of 2022 resulting from the strong growth in operating income and the continuous improvement of effective cost management. However, KBank continues to set aside expected credit loss under prudent approach. Although the expected credit loss was lower than that in the fourth quarter of 2022, it was in higher level when compared with the same period of 2022 to continue to proactively manage asset quality, and to cope with global economic uncertainties and various factors that may affect Thailand's economic recovery and some groups of customers that will likely remain on an uneven path. Moreover, in the first quarter of 2023 one of corporate customers had credit deterioration which ECL had already been reserved. However, KBank may consider setting the additional ECL to reflect the circumstances which is closely monitored.

Net interest income increased 9.84% consistent with rising interest rate and growth of new lending in line with the Bank's strategic direction. Although there was an increase in the finance cost resulting from an increase in the contribution rate to Financial Institution Development Fund and Deposit Protection Agency to its normal level of 0.46%, NIM stood at 3.46%. Non - interest income increased 32.00%, mainly due to the mark to market of financial instruments measured at fair value through profit or loss increased according to market condition. Other operating expenses increased 13.82% in line with an increase in operating income which was driven by business activities. In addition, employee expenses increased from cost of living subsidy measures which were one-time expenses. As a result, cost to income ratio stood at 42.50%, that was an approximate to the same period of 2022.

Operating performance for the first quarter of 2023 compared with the fourth quarter of 2022,

KBank and its subsidiaries reported net profit of Baht 10,741 million, an increase of Baht 7,550 Million compared to the fourth quarter of 2022 mainly due to a decrease of expected credit loss, which was set aside at high level in the fourth quarter of 2022 with prudent approach and to cope with uncertain economic circumstance. Operating profit before expected credit loss and income tax expense amounting to Baht 26,781 Million decreased from the preceding quarter primarily from a decrease in operating income. Other operating expenses decreased mainly from marketing expenses due to seasonality, while employee expenses increased partly from cost of living subsidy measures which were one-time expenses. Cost to income ratio stood at 42.50%, almost the same as the fourth quarter of 2022 that stood at 42.60%.

As of 31 March 2023, KBank and its subsidiaries' total assets were Baht 4,238,084 Million, a decrease of Baht 8,285 Million or 0.20% over the end of 2022. The majority came from a decrease in net loans partly due to non-performing loan management such as debt restructuring, sale of loans, written-off loans, etc. However, the new lending grow in customers in line with the Bank's business direction. NPL gross to total loans stood at 3.04% and coverage ratio stood at 156.68% that was higher than the end of 2022 that stood at 154.26%. In addition, as of 31 March 2023, KASIKORNBANK FINANCIAL CONGLOMERATE's Capital Adequacy Ratio (CAR) according to the Basel III Accord remain strong at 18.90%, with a Tier 1 Capital ratio of 16.92%.