CIMB Group Holdings has agreed to sell the automotive financing portfolios of CIMB Thai Auto Company Limited and WorldLease Company Limited, both subsidiaries of CIMB Thai Bank, to Bank of Ayudhya and its automotive finance arm, Ayudhya Capital Auto Lease Public Company Limited (Krungsri Auto). The sale is at a premium to adjusted net book value and is expected to complete within 2026. CIMB's 2026 financial guidance already incorporates the financial impact and related one-off costs. CIMB Thai's auto book contraction CIMB Thai recorded a pre-tax profit of THB 2,830 million ($87 million) in financial year 2025 (FY25), down 20.5% year-on-year, as operating income fell 8.8% to THB 13,772 million ($424 million), net interest income contracted 12.4%, and provisions rose 34.3%. Return on equity (ROE) came in at 4.4% for the full year, down from 5.9% in FY24, with the fourth quarter alone at 3.2%. CIMB Group's fourth-quarter 2025 (4Q25) analyst presentation framed the performance as a function of structural constraints and external headwinds. Within the consumer loan book, auto loans fell 12.8% in local currency terms in FY25, the steepest decline across any consumer product segment in the group's core markets that report auto lending. The analyst presentation described CIMB Thai as undergoing "ongoing structural operating model changes — strategic workforce transformation, branch optimisation, top line expansion and portfolio rebalancing." More recently, in the first quarter of 2026, net profit rose 8.4% year-on-year to THB 908.2 million ($27.9 million), though operating income continued to fall, down 3.1% to THB 3,473.3 million ($106.9 million). Net interest income (NII) contracted a further 7.1% and net interest margin (NIM) narrowed to 1.96% from 2.04% a year earlier. The non-performing loan (NPL) ratio improved to 2.1% from 2.2% at end-2025. Capital rebalancing under Forward30 Thailand contributed 3% of group pre-tax profit in FY25 while accounting for 10% of group risk-weighted assets (RWA). The RWA share was reduced from 12% in FY24 to 10% in FY25 under Forward30, CIMB's six-year strategic plan. Malaysia's RWA share rose from 54% to 56% over the same period, with Malaysia's share of group pre-tax profit increasing from 57% to 61%. Group chief executive officer (CEO) Novan Amirudin described the transaction as "disciplined execution" of Forward30. Following the transaction, CIMB Thai will focus on wealth management, intra-ASEAN trade flows and cross-border corporate banking, with the group targeting CIMB Thai's ROE toward double-digit levels over the medium term. At group level, CIMB delivered ROE of 11.3% for FY25 and is targeting 12–13% by 2027, the plan's midterm checkpoint. Krungsri's scale in Thai auto finance Krungsri is Thailand's fifth largest bank by assets, loans and deposits. As of 31 March 2026, the group reported THB 1.91 trillion ($58.8 billion) in loans and THB 2.61 trillion ($80.3 billion) in total assets. Domestic loans contracted 1.2% quarter-on-quarter in the first quarter on seasonal repayments and weaker underlying demand, while ASEAN operations expanded 2.5% over the same period. Krungsri Auto holds roughly one-third of Thailand's used car finance market. Krungsri President and CEO Kenichi Yamato described Thailand's operating environment as shaped by "high household leverage and sector-specific constraints," with gross domestic product (GDP) growth projected at 1.5–1.7% for 2026. He said the deal expands Krungsri Auto's reach and connects acquired customers to the group's broader product and digital platform, framed under its ONE Krungsri Collaboration pillar. Bank of Ayudhya, Krungsri Auto's parent, is majority-owned by Mitsubishi UFJ Financial Group (MUFG) of Japan.
