No Impact for MTC on the New NPL Classification Method

Big Boss MTC's 'Chuchat Petaumpai' Asserts Adherence to BOT's Guidelines Already in Place

Chuchat Petaumpai, the CEO of Muangthai Capital Public Company Limited (MTC), revealed that the recent significant stock price downturn over the past 1-2 days was due to concerns that the company might need to reclassify its debts similarly to some financial institutions. This prompted increased provisions, but he confirmed that MTC had already accounted for these by using installment payments to cover both principal and overdue interest in accordance with BOT criteria. This method had no impact on income perception and reduced interest rates. Thus, there is no necessity for MTC to alter its approach to restructuring NPLs.

'Investors worried about potential debt restructuring leading to reduced interest rates and increased NPLs can put those concerns to rest. We strictly adhere to BOT guidelines, considering the risks in our business operations and remarkably, our Non-Performing Loans (NPLs) are significantly lower compared to industry standards'

Moreover, the company aims to maintain its Non-Performing Loan ratio below 2.0% in 2019, which is presently around 1.26%, well below the industry average.

Chuchat Petaumpai further stated that the company's plans for 2019 include opening 600 new branches, resulting in over 3,900 branches nationwide by year-end. This expansion aims to comprehensively meet customer needs while targeting a 35% growth in revenue and profits, a new consecutive record high compared to the previous year's expected 40% growth. Additionally, the company is preparing to adhere to the new criteria for Personal Loans (P-loans) under the supervision of the Bank of Thailand (BOT), expected to be clearer soon.

The new P-loan criteria set by BOT is poised to bolster MTC's growth opportunities. Presently, the company offers P-Loans covering microloans, vehicle title loans and motorcycle loans, all of which presently cap interest rates at 23%, below the newly designated 28% ceiling. This allows for flexibility in raising interest rates if financial costs escalate, in line with the increasing trend of deposit interest rates during the upward economic phase.