Amid an investment environment full of challenges, the Thai stock market in mid-April 2026 is entering one of the most important seasons of the year—the period for commercial banks to announce their Q1/2026 financial results.
At this time, investors nationwide closely monitor financial figures to assess how Thai financial institutions are coping with economic headwinds, including volatility in interest rates and ripple effects from global geopolitical conflicts.
As is customary in the Thai stock market and according to brokerage forecasts, the first bank to reveal its financial statements and provide an early overview is TISCO, or TISCO Financial Group Public Company Limited. Following TISCO's announcement, other financial institutions will sequentially report their earnings.
Recently, TISCO released its Q1/2026 operating results, reporting a net profit of 1,733.62 million baht, up 5.5% compared to the same period last year, and a 5.6% increase from the previous quarter.
The key factor driving this quarter's profit was the outstanding growth of non-interest income, which reached 1,719.56 million baht, a 27.2% rise from the previous year, benefiting from recovery across all business segments.
This includes the insurance brokerage business, which grew alongside new loan disbursement volumes; brokerage fees from securities trading, which recovered in line with market trading volumes; and fee income from fund management services.
On the net interest income (NII) side, performance remained strong at 3,443.11 million baht, up 3.4% from last year and 0.8% from the previous quarter. Despite the bank facing policy rate cuts, TISCO benefited from reduced interest expenses due to declining deposit costs amid the downtrend in interest rates.
Looking at the banking industry overall, the sector is clearly facing challenges from a downward trend in interest rates. The Monetary Policy Committee cut the policy rate four times in 2025 down to 1.25%, and most recently in February 2026 by another 0.25%, bringing it to 1.00%.
Pi Asset Management Company Limited assessed that this low-interest environment directly pressures banks' profitability. They expect the average net interest margin (NIM) for the group in Q1/2026 to continue declining for the sixth consecutive quarter, down to 2.9%.
The impact from weak NIM and reduced profits from financial instruments (FVTPL) leads Pi Asset Management to forecast that the combined net profit of nine banks in Q1/2026 will be 57 billion baht, a 6.6% decrease from the previous year.
However, compared to the previous quarter, the banks' net profit is expected to rebound by 12.5%, supported significantly by lower operating expenses.
Additionally, total loans in Q1/2026 are expected to remain steady from the previous quarter at 12.2 trillion baht but contract by 0.8% year-on-year. Meanwhile, asset quality remains manageable with an average NPL ratio steady at about 3.7%.
These challenges lead to a forecast of about a 2% decline in the banking sector's total net profit for the full year 2026 compared to the previous year.
Another development is the Bank of Thailand's plan to open a public hearing on the “new fee standards” starting April 10, 2026, with implementation expected by late May.
This will cover 17 to 19 transactions, including account maintenance fees, BahtNet system fees, and fees related to lending.
Asia Plus Securities Research views that although fee controls may pressure the investment atmosphere short-term, the real impact on profit forecasts will be limited.
This is because banks' fee income structures have already adjusted and shifted focus toward affluent customer segments since the era of free fund transfer fees began in 2018.
Most of the impact will fall on large commercial banks, which have higher proportions of fee income to total income. KBANK is the most sensitive, with fee income accounting for 18% of its total revenue among major banks, while KTB will be less affected at 14%.
Conversely, although banks like KKP and TISCO have high fee income ratios of 23-25%, they are less impacted because their fee income mainly comes from capital markets. TISCO derives 83% of its fees from capital markets and bancassurance, and KKP about 68%.
Asia Plus Securities also points out that every 2% change in fees will affect profits by no more than 1%.
Meanwhile, the Bank of Thailand has signaled it will keep the credit card minimum payment rate at 8% to ease debtor burdens, rather than returning to 10% next year. This will reduce credit risk in credit card portfolios and positively impact BAY, KBANK, and SCB.
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