1 February 2024
Bangkok (1 February 2024) –
Krungsri (Bank of Ayudhya PCL and its business units), a member of Mitsubishi UFJ Financial Group (MUFG), one of the world’s largest financial groups, announced its new Medium-Term Business Plan (MTBP) covering 2024-2026 with an aspiration to be
The Leading Sustainable and Regional Bank. Krungsri prioritises three key focuses: enhancing its dedication to sustainable banking practices, connecting its strong ASEAN presence and MUFG network to serve domestic and international markets, and growing its core business.
Mr. Kenichi Yamato, Krungsri President and Chief Executive Officer, said, “Last year marked the 10
th anniversary of Krungsri’s partnership with MUFG and the completion of our 3
rd MTBP. Our focus has continuously been on adopting a customer-centric approach to deliver products and services through the enhancement of our digital and innovation capabilities, and we have had many great achievements during our journey, including establishing a strong presence across ASEAN, significantly expanding our focus to the ESG space and pioneering the introduction of Thailand's inaugural Sustainability Linked finance products, and establishing robust corporate venture capital, Krungsri Finnovate to actively support startups and technology companies. The accomplishments of Krungsri over the past decade are clearly evident in our financial performance. We have experienced substantial growth, with our net income escalating from 11 billion baht to surpassing 30 billion baht, marking a threefold increase within the decade. Currently, our ROE holds a leading position in the industry. We are also maintaining unwavering leadership in asset quality.”
Mr. Kenichi Yamato, Krungsri President and Chief Executive Officer
“As we embark on our 4
th MTBP, our aspiration is to be
The Leading Sustainable and Regional Bank. This reflects Krungsri's determination to drive economic, social, environmental and governance sustainability towards a secure and enduring future and establishes Krungsri as a leading sustainable and regional bank. Our journey aligns seamlessly with MUFG's broader purpose and values. Together, we are committed to empowering a brighter future through shared goals in sustainability, responsible banking, and community development.” Mr. Kenichi added.
The year ahead
According to Krungsri Research, Thailand is on the path to gradual economic recovery, fueled by the resurgence of public expenditure, policy supports, a gradual rebound in tourism activity, and a notable rise in employment. However, as external headwinds pose challenges to the prospect of sustained growth, tightened financial conditions and the spectre of drought add further complexity, curtailing the overall pace of economic activity.
Mr. Kenichi Yamato (right) Krungsri President and Chief Executive Officer
Miss Duangdao Wongpanitkrit (centre) Krungsri Chief Financial Officer
Mr. Pairote Cheunkrut (left) Krungsri Chief Strategy Officer
Aspirations and direction
The new MTBP for 2024 – 2026 is more than a plan. At the core is Krungsri’s aspiration to be 'The Leading Sustainable and Regional Bank,' reflecting the company's commitment to a future where sustainability and making regional impact take centre stage. To achieve this, the 2024-2026 MTBP will focus on three strategic goals: becoming a leading sustainable bank; driving its regional leadership; and ensuring it maintains a leading position in its core business.
Translating ESG goals into financial success
Krungsri has already established a sustainability leadership position by committing to growing its social and sustainable finance portfolio by 100 billion baht by 2030 as well as supporting clients with the issuance of sustainable finance. At the end of 2023, our social and sustainable finance portfolio increased by 71 billion baht from the 2021 base year. The next MTBP will expand its scope of sustainable finance services to reach a more diverse customer base, including SMEs and retail customers. The bank will also focus on transition financing to assist corporate and SME clients in transition into low-carbon businesses, while also supporting clients in taxonomy, which classifies types of economic activities corresponding to their carbon intensity using the traffic light system.
Creating value for customers
Krungsri and MUFG’s current ASEAN network spans across 9 of the 10 ASEAN countries encompassing Krungsri’s overseas subsidiaries in 5 countries: Indonesia, the Philippines, Vietnam, Cambodia and Lao PDR, serving 17 million customers. Its regional presence enhances the bank's capabilities in various aspects, from business models and product offerings to funding, risk management, digital solutions, and innovation.
This provides a strong foundation for Krungsri to be the leading regional bank, and Krungsri will continue to utilise MUFG and Krungsri’s network to drive growth by connecting with the needs of our clients in Thailand and the region by providing comprehensive business matching solution through the Krungsri Business Link Platform and Krungsri ASEAN Link service. This service connects Thai business customers to reliable verified business partners throughout the bank’s network in ASEAN and Japan.
Reinforcing core strengths
Krungsri is dedicated to strengthening its leading position in its core businesses prioritising Digital, Data, Ecosystem, and Partnerships. These pillars continue to its sustainable growth. For retail and consumer banking customers, Krungsri is advancing its One Retail strategy by using data-driven to serve customers. For commercial business customers, Krungsri is amplifying its transaction banking capabilities, both domestically and internationally, through strategic collaborations with external partners, embracing the concept of Banking as a Service. Furthermore, in digital and IT, Krungsri is investing in digital platforms and cutting-edge technology, with a customer-centric approach. These technologies, including AI and ML, are employed to enrich product and service offerings across all customer touchpoints, spanning branches, online platforms, mobile applications, and call centres.
Krungsri expects its loan business to grow by 3-5% through 2024, while the targeted net interest margin (NIM) is at 3.8 - 4.1%. It is expected that the ratio of Non-Performing Loans (NPL) ratio will be between 2.50 – 2.75%, and the cost-to-income ratio will be in the mid-40%s.