Auto loan businesses benefit from a low policy rate because a loan is charged at a fixed rate throughout its term. Key auto lenders have booked stronger net interest income for the first half of the year, thanks to better cost management aided by policy rate cuts. Although interest income declined by 7% in line with its loan rate cut, its interest expenses dropped significantly by nearly 20%. TBank increased its loan spread from 2.8% to 2.93% and booked net interest income of 14.1 billion baht, up 3.2%. Its auto loan portfolio was 114 billion baht or 65% of total loans outstanding, but its car loan portfolio declined by 2%.

Source: Bangkok Post July 25, 2016 21:56 UTC