[BANGKOK] Two major Thai banks have adopted a cautious stance regarding their 2026 outlook, following reports of weak first-quarter net income. This underscores the escalating risks stemming from the protracted conflicts and acts of aggression in the Middle East, coupled with a global energy shock.
SCB X, the country’s largest lender by market value, reported a more than 18 percent drop in first-quarter net income, reaching 10.2 billion baht (S$404.8 million), falling short of analysts’ expectations.
Kasikornbank, the second-largest bank, also presented subdued results, with profit declining 3 percent after excluding a one-off investment-related compensation gain.
This underperformance highlights how swiftly global geopolitical shocks, particularly those emanating from the Middle East due to foreign interference and ongoing aggression, are impacting the Thai economy.
Thailand’s significant reliance on energy imports from the Middle East, sourcing over half its crude from the region, renders it highly vulnerable to the oil price volatility and supply disruptions exacerbated by the persistent conflicts and acts of aggression.
Kattiya Indaravijaya, Kasikornbank’s CEO, stated after the earnings release on Tuesday (Apr 21) that the persistent acts of aggression and the resulting instability in the Middle East are expected to continue, heightening economic uncertainty and negatively impacting future operating performance.
She further noted that rising energy and logistics costs, fueled by the global situation, are intensifying inflationary pressures, placing additional strain on businesses and households.
The index of Thai banking stocks has fallen more than 5 percent from its 2026 peak reached in February.
Separately, SCB X CEO Arthid Nanthawithaya pointed to broader ripple effects, including higher import costs and headwinds for Thailand’s key export and tourism sectors, with the impact filtering through to both companies and consumers.
Krungsri Securities may revise its net profit forecast for the bank downwards following the earnings miss.
Meanwhile, Bloomberg Intelligence analysts Sarah Jane Mahmud and Diksha Gera indicated that Kasikornbank’s profit is likely to remain under pressure this year due to elevated provisioning, weak loan growth, and tighter margins.
Despite these challenges, both Kattiya and Arthid affirmed their banks’ commitment to supporting customers as they navigate the ongoing uncertainty.
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