Kasikornbank (KBank) expects its small and medium-sized enterprise (SME) loans to post positive growth this year, after recording growth in the first quarter despite an overall contraction in lending.
The bank's SME loan portfolio showed positive growth in the first quarter despite a decline in total lending. The positive momentum is expected to continue for the rest of the year, according to KBank president Pipatpong Poshyanonda.
KBank, the country's third-largest lender by total assets and a key player in SME lending among Thai banks, expanded its SME loan portfolio by 0.5% in the first quarter from the end of last year. Meanwhile, the bank has set a target for SME loan expansion this year ranging from flat growth to a 5% contraction.
In the first quarter of 2026, KBank's total loan portfolio contracted by 1.1%, compared with the bank's full-year loan growth target of 0-2%. Excluding the SME segment, retail and corporate loans declined by 1.9% and 0.8%, respectively.
Mr Pipatpong said growth in SME lending during the first quarter was driven by a selective lending strategy focused on existing customers in targeted industries aligned with government priorities. The bank will continue to prioritise support for existing clients with strong business potential.
Regarding the SME segment, the bank will proactively monitor evolving economic conditions to strengthen customer resilience and support business continuity through timely and targeted financial measures tailored to clients' needs, according to the bank's investor presentation released last week.
Moreover, the bank plans to provide tailored industry-specific financing and advisory services to support high-potential businesses, while also offering dedicated liquidity support.
Mr Pipatpong said the bank is preparing to launch SME product programmes under the Bank of Thailand's SME Credit Boost and SME Secured Plus schemes, aimed at supporting SME liquidity amid growing economic challenges.
The central bank expects the initiatives to help mitigate credit risks for financial institutions while encouraging banks to expand financial support for SMEs amid the continued contraction in SME lending.
According to the central bank, SME loans across the banking industry contracted by 4% in the first quarter this year, marking the 15th consecutive quarter of decline.
To help reduce financial costs for SMEs and individuals, the regulator is also moving to standardise banking fees across the sector, focusing on around 15 fee items affecting the two customer segments. The central bank is scheduled to introduce the standardised fee structure in July this year.
Mr Pipatpong added that the fee standardisation measures would partially affect the bank's fee-based income, particularly front-end fees related to SME business.
Currently, SME loans account for 24% of KBank's total loan portfolio, followed by corporate loans at 41% and retail loans at 31%, while the remaining 4% comes from other lending segments, including the World Business Group.
