KBANK's one-time IT expense worth THB2.4b hurts 4Q15 earnings

4Q15 net profit may have fell by 41% QoQ.

Kasikornbank reported weaker 4Q15 earnings, partly due to one-time extra expenses regarding IT infrastructure totalling THB2.4b incurred this quarter. This should have caused operating expenses to jump 33% QoQ, pushing down pre-provision profit by 22.5% QoQ to THB16.8b, according to Maybank Kim Eng.

Operating incomes were generally flat as previously expected, and Maybank Kim Eng estimates net interest income rose 3.4% QoQ, mainly due to a 2.3%
QoQ expansion in loans. Net interest margin also strengthened by 7bps to 3.64%. Non-interest income should have weakened by 3.0% QoQ due to the slowdown in bancassurance and capital market activities. As a result, operating income is likely to have edged up by 0.6% QoQ

"In conclusion, 4Q15 net profit may have fell by 41% QoQ, to THB6.0b making FY15 earnings THB40.0b, slightly lower than our current official number at THB40.5b," says Maybank Kim Eng analyst Maria Lapiz.

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